Document:

Exhibit 4.1

 

STANDARD INDENTURE TERMS

 

with respect to

 

PROTECTIVE LIFE SECURED TRUSTS

 

Secured Medium-Term Notes and InterNotes®

 

 

Dated as of November 7, 2003

 

 

TABLE
OF CONTENTS

 

	
  ARTICLE
  1

  
	
  Definitions and Other Provisions of General
  Application

  
	
  SECTION
  1.01.  Definitions

  
	
  SECTION
  1.02.  Compliance Certificates and
  Opinions

  
	
  SECTION
  1.03.  Form of Documents Delivered to
  Indenture Trustee

  
	
  SECTION
  1.04.  Acts of Holders

  
	
  SECTION
  1.05.  Notices

  
	
  SECTION
  1.06.  Notice to Holders; Waiver

  
	
  SECTION
  1.07.  Severability

  
	
  SECTION
  1.08.  Successors and Assigns

  
	
  SECTION
  1.09.  Benefits of Indenture

  
	
  SECTION
  1.10.  Language of Notices

  
	
  SECTION
  1.11.  Governing Law

  
	
  SECTION
  1.12.  Waiver of Jury Trial

  
	
  SECTION
  1.13.  Counterparts

  
	
  SECTION
  1.14.  Third Party Beneficiaries

  
	
  SECTION
  1.15.  Conflict with Trust Indenture
  Act

  
	
   

  
	
  ARTICLE
  2

  
	
  The Notes

  
	
  SECTION
  2.01.  Forms Generally

  
	
  SECTION
  2.02.  No Limitation on Aggregate
  Principal Amount of Notes

  
	
  SECTION
  2.03.  Listing

  
	
  SECTION
  2.04.  Redemption

  
	
  SECTION
  2.05.  Execution, Authentication and
  Delivery Generally

  
	
  SECTION
  2.06.  Registration

  
	
  SECTION
  2.07.  Transfer

  
	
  SECTION
  2.08.  Mutilated, Destroyed, Lost and
  Stolen Notes

  
	
  SECTION
  2.09.  Payment of Interest; Rights To
  Interest Preserved

  
	
  SECTION
  2.10.  Cancellation

  
	
  SECTION
  2.11.  Persons Deemed Owners

  
	
  SECTION
  2.12.  Tax Treatment; Tax Returns and
  Reports

  
	
  SECTION
  2.13.  No Partners

  
	
   

  
	
  ARTICLE
  3

  
	
  Covenants, Representations and Warranties

  
	
  SECTION
  3.01.  Payment of Principal and any
  Premium, Interest and Additional Amounts

  
	
  SECTION
  3.02.  Collection Account

  
	
  SECTION
  3.03.  Agreements of the Paying Agent

  
	
  SECTION
  3.04.  Maintenance of Office or Agency

  
	
  SECTION
  3.05.  Duties of the Agents

  
	
  SECTION
  3.06.  Duties of the Transfer Agent

  
	
  SECTION
  3.07.  Duties of the Registrar

  
	
  SECTION
  3.08.  Unclaimed Monies

  

 

i

 

	
  SECTION
  3.09.  Protection of Collateral

  
	
  SECTION
  3.10.  Opinions as to Collateral;
  Annual Statement as to Compliance

  
	
  SECTION
  3.11.  Performance of Obligations

  
	
  SECTION
  3.12.  Existence

  
	
  SECTION
  3.13.  Reports; Financial Information;
  Notices of Defaults

  
	
  SECTION
  3.14.  Payment of Taxes and Other
  Claims

  
	
  SECTION
  3.15.  Negative Covenants

  
	
  SECTION
  3.16.  Non-Petition

  
	
  SECTION
  3.17.  Title to the Collateral

  
	
  SECTION
  3.18.  Withholding and Payment of
  Additional Amounts

  
	
  SECTION
  3.19.  Additional Representations and
  Warranties

  
	
  SECTION
  3.20.  Ancillary Documents

  
	
   

  
	
  ARTICLE
  4

  
	
  Granting of Security Interest and Assignment for Collateral Purposes

  
	
  SECTION
  4.01.  Creation

  
	
  SECTION
  4.02.  Scope

  
	
  SECTION
  4.03.  Termination of Security
  Interest

  
	
   

  
	
  ARTICLE
  5

  
	
  Satisfaction  and Discharge; Subrogation

  
	
  SECTION
  5.01.  Satisfaction and Discharge of
  Indenture

  
	
  SECTION
  5.02.  Application of Trust Money

  
	
   

  
	
  ARTICLE
  6

  
	
  Defaults and Remedies

  
	
  SECTION
  6.01.  Events of Default

  
	
  SECTION
  6.02.  Acceleration of Maturity Date;
  Rescission and Annulment

  
	
  SECTION
  6.03.  Collection of Indebtedness and
  Suits for Enforcement

  
	
  SECTION
  6.04.  Indenture Trustee May File
  Proofs of Claim

  
	
  SECTION
  6.05.  Indenture Trustee May Enforce
  Claims Without Possession of Notes

  
	
  SECTION
  6.06.  Application of Money Collected

  
	
  SECTION
  6.07.  Limitation on Suits

  
	
  SECTION
  6.08.  Unconditional Rights of Holders
  to Receive Payments

  
	
  SECTION
  6.09.  Restoration of Rights and
  Remedies

  
	
  SECTION
  6.10.  Rights and Remedies Cumulative

  
	
  SECTION
  6.11.  Delay or Omission Not Waiver

  
	
  SECTION
  6.12.  Control by Holders

  
	
  SECTION
  6.13.  Waiver of Past Defaults

  
	
  SECTION
  6.14.  Undertaking for Costs

  
	
  SECTION
  6.15.  Waiver of Stay or Extension
  Laws

  
	
   

  
	
  ARTICLE
  7

  
	
  The Indenture Trustee and Other Agents

  
	
  SECTION
  7.01.  Duties of Indenture Trustee and
  Agents

  
	
  SECTION
  7.02.  No Liability to Invest

  
	
  SECTION
  7.03.  Performance Upon Default

  

 

ii

 

	
  SECTION
  7.04.  No Assumption by Paying Agent,
  Transfer Agent, Calculation Agent or Registrar

  
	
  SECTION
  7.05.  Notice of Default

  
	
  SECTION
  7.06.  Rights of Indenture Trustee

  
	
  SECTION
  7.07.  Not Responsible for Recitals or
  Issuance of Notes

  
	
  SECTION
  7.08.  Indenture Trustee May Hold
  Notes

  
	
  SECTION
  7.09.  Money Held in Trust

  
	
  SECTION
  7.10.  Compensation and Reimbursement

  
	
  SECTION
  7.11.  Eligibility

  
	
  SECTION
  7.12.  Resignation and Removal;
  Appointment of Successor

  
	
  SECTION
  7.13.  Acceptance of Appointment by
  Successor

  
	
  SECTION
  7.14.  Merger, Conversion,
  Consolidation or Succession to Business of Indenture Trustee

  
	
  SECTION
  7.15.  Co-trustees

  
	
  SECTION
  7.16.  Appointment and Duties of the
  Calculation Agent

  
	
  SECTION
  7.17.  Changes in Agents

  
	
  SECTION
  7.18.  Limitation of Wilmington
  Liability

  
	
   

  
	
  ARTICLE
  8

  
	
  Supplemental Indentures

  
	
  SECTION
  8.01.  Supplemental Indentures Without
  Consent of Holders

  
	
  SECTION
  8.02.  Supplemental Indenture With
  Consent of Holders

  
	
  SECTION
  8.03.  Execution of Supplemental
  Indentures

  
	
  SECTION
  8.04.  Effect of Supplemental
  Indenture

  
	
  SECTION
  8.05.  Reference in Notes to
  Supplemental Indentures

  
	
  SECTION
  8.06.  Conformity with Trust Indenture
  Act

  
	
   

  
	
  ARTICLE
  9

  
	
  Non-Recourse Provisions

  
	
  SECTION
  9.01.  Nonrecourse Enforcement

  
	
   

  
	
  ARTICLE
  10

  
	
  Meetings of Holders of Notes

  
	
  SECTION
  10.01.  Purposes for Which Meetings
  May be Called

  
	
  SECTION
  10.02.  Call, Notice and Place of
  Meetings

  
	
  SECTION
  10.03.  Persons Entitled to Vote at
  Meetings

  
	
  SECTION
  10.04.  Quorum; Action

  
	
  SECTION
  10.05.  Determination of Voting
  Rights; Conduct and Adjournment of Meetings

  
	
  SECTION
  10.06.  Counting Votes and Recording
  Action of Meetings

  
	
   

  
	
  ARTICLE
  11

  
	
  Notes in Foreign Currencies

  
	
  SECTION
  11.01.  Notes in Foreign Currencies

  

 

iii

 

EXHIBITS

 

	
  Exhibit
  A-1

  	
  Form
  of Retail Note

  
	
  Exhibit
  A-2

  	
  Form
  of Institutional Global Note

  
	
  Exhibit
  A-3

  	
  Form
  of Institutional Definitive Note

  

 

iv

 

Reconciliation and tie between

Trust Indenture Act of 1939 (the “Trust Indenture Act”)

and Indenture

 

 

	
  Trust Indenture Act Section

  	
   

  	
  Indenture
  Section

  
	
   

  	
   

  	
   

  
	
  §310(a)

  	
   

  	
  7.11

  
	
   (b)

  	
   

  	
  7.11

  
	
  §311(a)

  	
   

  	
  7.08

  
	
  §312(a)

  	
   

  	
  3.13

  
	
   (b)

  	
   

  	
  3.13

  
	
   (c)

  	
   

  	
  3.13

  
	
  §313(a)

  	
   

  	
  3.13

  
	
   (b)

  	
   

  	
  3.13

  
	
   (c)

  	
   

  	
  3.13

  
	
   (d)

  	
   

  	
  3.13

  
	
  §314(a)

  	
   

  	
  3.10

  
	
   (b)

  	
   

  	
  3.10

  
	
   (c)

  	
   

  	
  3.10

  
	
   (d)

  	
   

  	
  3.10

  
	
   (e)

  	
   

  	
  1.03, 3.10

  
	
  §315(c)

  	
   

  	
  7.01

  
	
  §316(a)(1)
  (A)

  	
   

  	
  6.02, 6.12

  
	
   (a)(1)(B)

  	
   

  	
  6.13

  
	
   (b)

  	
   

  	
  6.08

  
	
   (c)

  	
   

  	
  1.04

  
	
  §317(a)(1)

  	
   

  	
  6.03

  
	
  (a)(2)

  	
   

  	
  6.04

  
	
  (b)

  	
   

  	
  3.03

  
	
  §318(a)

  	
   

  	
  1.15

  
	
   (c)

  	
   

  	
  1.15

  

 

Note:  This reconciliation and
tie shall not, for any purpose, be deemed to be part of the Indenture.

 

Attention should also be
directed to Section 318(c) of the Trust Indenture Act, which provides that
certain provisions of Sections 310 to and including 317 are a part of and
govern every qualified indenture, whether or not physically contained herein.

 

v

 

STANDARD INDENTURE TERMS

 

This document
constitutes the Standard Indenture Terms, dated as of November 7, 2003, which
are incorporated by reference in one or more Indentures (included in Section E
of the Omnibus Instrument, as defined below), by and among a Protective Life
Secured Trust and the Indenture Trustee, Registrar, Transfer Agent, Paying
Agent and Calculation Agent for such Trust, in connection with the Program (all
as defined herein).

 

These Standard
Indenture Terms shall be of no force and effect unless and until incorporated
by reference into, and then only to the extent not modified by, an Indenture.

 

The following
terms and provisions shall govern the Notes subject to contrary terms and
provisions expressly adopted in any Indenture, any supplemental indenture or
the Notes which contrary terms shall be controlling.

 

ARTICLE 1

Definitions and Other Provisions of General Application

 

SECTION 1.01. 
Definitions.  For all purposes of this Indenture, of all
indentures supplemental hereto and of all Notes issued hereunder or thereunder,
except as otherwise expressly provided or unless the context otherwise
requires:

 

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

 

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

 

(c)                                  the
word “including” shall be construed to be followed by the words “without
limitation”;

 

(d)                                 Article
and Section headings are for the convenience of the reader and shall not be
considered in interpreting this Indenture or the intent of the parties hereto;
and

 

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

 

(f)                                    References
herein to Articles, Sections, Exhibits and Schedules shall, refer respectively
to Articles, Sections, Exhibits and Schedules of these Standard Indenture
Terms, unless otherwise expressly provided.

 

“Act”, with respect to any Holder, has the
meaning set forth in Section 1.04.

 

1

 

“Additional Amounts”  means additional amounts which are required
hereby to be paid by the Trust to Holders pursuant to Section 3.18 or
additional amounts which are required pursuant to the Funding Agreement, under
circumstances specified therein, to be paid by Protective Life to the Funding
Agreement Holder, to compensate for any withholding or deduction for or on the
account of any present or future taxes, duties, levies, assessments or
governmental charges of whatever nature imposed or levied on payments in
respect of such Note or Funding Agreement, as applicable, by or on behalf of
any governmental authority in the United States having the power to tax, so
that the net amount received by the Holder or the Funding Agreement Holder,
will equal the amount that would have been received under such Note or Funding
Agreement, had no such deduction or withholding been required.

 

“Administrative Services Agreement” means
that certain Administrative Services Agreement, dated as of the date specified
in the Omnibus Instrument, by and between Wilmington, on behalf on the Trust
and the Administrator, as the same may be amended, modified or supplemented
from time to time.

 

“Administrator” means, unless otherwise
specified in this Indenture, AMACAR Pacific Corporation in its capacity as
Administrator pursuant to the Administrative Services Agreement, and shall also
include its permitted successors and assigns as Administrator thereunder.

 

“Affiliate” means, as applied to any Person,
any other Person directly or indirectly controlling, controlled by, or under
direct or indirect common control with, that Person and, in the case of an
individual, any spouse or other member of that individual’s immediate family.
For the purposes of this definition, “control” (including with correlative
meanings, the terms “controlling”, “controlled by” and “under common control
with”), as applied to any Person, means the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
that Person, whether through the ownership of voting securities or by contract
or otherwise.

 

“Agent” means any of
the Registrar, Transfer Agent, Paying Agent or Calculation Agent.

 

“Authorized Newspaper” means a newspaper, in
an official language of the place of publication or in the English language,
customarily published on each day that is a business day in the place of
publication, whether or not published on days that are not business days in the
place of publication, and of general circulation in each place in connection
with which the term is used or in the financial community of each such
place.  Where successive publications
are required to be made in Authorized Newspapers, the successive publications
may be made in the same or in different newspapers in the same city meeting the
foregoing requirements and, in each case, on any day that is a business day in
the place of publication.

 

“Authorized Signatories” mean Responsible
Officers authorized to execute documents on behalf of the Trust.

 

“Banking Day”  means a day (other than a Saturday or Sunday) on which commercial
banks are generally open for business (including dealings in foreign exchange
and foreign currency deposits) in the place where the specified office of the
Paying Agent or, as the case may be, the Registrar, is located.

 

2

 

“Business Day” means (i) for any Note, any
day, other than a Saturday or Sunday, that is neither a legal holiday nor a day
on which commercial banks are authorized or required by law, regulation or
executive order to close in The City of New York, (ii) for purposes of interest
determination dates for LIBOR Notes only, any day on which dealings in deposits
in U.S. Dollars are transacted, or with respect to any future date are expected
to be transacted, in the London interbank market, (iii) for Notes that have a
Specified Currency other than U.S. Dollars only, and other than Notes
denominated in euros, any day that, in the Principal Financial Center of the
country of the Specified Currency, is not a day on which banking institutions
generally are authorized or obligated by law to close, and (iv) for Notes that
have euros as the Specified Currency, a day on which the TARGET System is open.

 

“Calculation Agent” means, in relation to
the Notes, the institution appointed as calculation agent for the purposes of
the Notes and named as such in the relevant Pricing Supplement.  For such purpose, the Paying Agent accepts
its appointment as such pursuant to Section 7.16.

 

“Clearing System” means DTC and any other
Clearing System specified in the relevant Pricing Supplement.

 

“Code” means the Internal Revenue Code of
1986, as amended, including any successor or amendatory statutes and any
applicable rules, regulations, notices or orders promulgated thereunder.

 

“Collateral” means, with respect to the
Notes, the right, title and interest of the Trust in and to (i) the Funding
Agreements held in the Trust, (ii) all proceeds of the Funding Agreement and
all amounts and instruments on deposit from time to time in the Trust’s
Collection Account, (iii) all books and records pertaining to the Funding
Agreement(s), and (iv) all rights of the Trust pertaining to the foregoing.

 

“Collection Account” means an account with
the Indenture Trustee in the name of the Trust or such other account with a
depositary institution that is rated at least 
AA- or Aa3 by a nationally recognized statistical rating organization as
may be designated by Wilmington or the Administrator, which account shall be
segregated from other accounts held by the Indenture Trustee or such other
depositary institution.

 

“Commission” means the Securities and
Exchange Commission or any successor body performing such duties of the
Commission.

 

“Contingent Obligation” means, as applied to
any Person, without duplication, any direct or indirect liability, contingent
or otherwise, of that Person (i) with respect to any Indebtedness, lease,
dividend, letter of credit or other obligation of another if the primary purpose
or intent thereof by the Person incurring the Contingent Obligation is to
provide assurance to the obligee of such obligation of another that such
obligation of another will be paid or discharged, or that any agreements
relating thereto will be complied with, or that the holders of such obligation
will be protected (in whole or in part) against loss in respect thereof, (ii)
under any letter of credit issued for the account of or for which that Person
is otherwise liable for reimbursement thereof, (iii) under agreements providing
for the hedging or limitation of interest

 

3

 

rate or currency risk, (iv)
under any performance bond or other surety arrangement, (v) under any direct or
indirect guaranty, endorsement (otherwise than for collection or deposit in the
ordinary course of business), co-making, discounting with recourse or sale with
recourse by such Person of the obligation of another, or (vi) for the
obligations of another through any agreement (contingent or otherwise).

 

“Corporate Trust Office” means the office of
the Indenture Trustee at which the corporate trust business of the Indenture
Trustee shall, at any particular time, be principally administered, which
office at the date of this Indenture is located as indicated in Section 1.05.

 

“Dealer” means the dealers identified in the
Distribution Agreement or the agents identified in the Selling Agent Agreement,
as applicable.

 

“Default” means any occurrence that is, or
with notice or the lapse of time or both would become, an Event of Default.

 

“Defaulted Interest” has the meaning set
forth in Section 2.09.

 

“Definitive Note” means a Note in
certificated and registered form.

 

“Depositary” means the Person designated as
Depositary by the Trust pursuant to this Indenture, which Person, if required
by any applicable law, regulation or exchange requirement, must be a clearing
agency registered under the Securities Exchange Act and, if so provided with
respect to any Note, any successor to such Person.  Initially, the “Depositary” shall be DTC.

 

“Distribution Agreement” means that certain
Distribution Agreement, dated as of the date specified in the Omnibus
Instrument, by and among the Trust, Protective Life and the dealers named
therein relating to the issuance and sale of the Notes under the Trust’s
Secured Medium-Term Note Program, as the same may be amended, modified or
supplemented.

 

“Dollars”, “$”, “U.S.  $” and “U.S.
Dollars” mean such coin or currency of the United States as at the
time shall be legal tender for the payment of public or private debts.

 

“DTC” means The Depository Trust Company,
and its successors and assigns.

 

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

 

“Expense and Indemnity Agreement” means that
certain Expense and Indemnity Agreement, dated as of the date specified in the
Omnibus Instrument, by and among Protective Life and each of Wilmington, on
behalf of the Trust and itself, the Indenture Trustee, and the Administrator
and any service provider that may become a party to such agreement from time to
time, as the same may be amended, modified or supplemented from time to time.

 

“European Union Directive” means any law,
regulation, directive or any interpretation by the European Union or a member
nation of the European Union which requires the withholding or deduction of any
amounts payable under the Notes or the Funding Agreement.

 

4

 

“Funding Agreement” means that certain
funding agreement (or funding agreements), entered into by and between
Protective Life and the Trust and subsequently pledged and collaterally
assigned to the Indenture Trustee for the benefit of the holders of the Notes,
as it may be modified, restated, replaced, supplemented or otherwise amended
from time to time in accordance with the terms thereof.

 

“Funding Agreement Holder”  means
the holder of the Funding Agreement specified as such in the Funding Agreement.

 

“Global Note” means a Note issued in
book-entry and registered form.

 

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

 

“Indebtedness” means, as applied to any
Person, (i) all indebtedness for borrowed money or for the deferred purchase
price of property or services in respect of which such Person is liable, contingent
or otherwise, or in respect of which such Person otherwise assures a creditor
against loss (excluding trade accounts payable and accrued expenses arising in
the ordinary course of business as determined in good faith by such Person),
(ii) that portion of obligations with respect to capital leases which is
properly classified as a liability on a balance sheet in conformity with
generally accepted accounting principles, (iii) obligations evidenced by bonds,
notes, debentures or similar instruments of such Person, and notes payable by
such Person and drafts accepted by such Person representing extensions of
credit whether or not representing obligations for borrowed money, (iv) the
face amount of all drafts drawn thereunder; and (v) all indebtedness secured by
any Lien on any property or asset owned or held by that Person regardless of
whether the indebtedness secured thereby shall have been assumed by that Person
or is non-recourse to the credit of that Person.

 

“Indenture” means that certain Indenture, dated
as of the date specified in the Omnibus Instrument, by and between the
Indenture Trustee and the Trust, as amended or supplemented from time to time
which incorporates by reference these Standard Indenture Terms, and shall
include the terms of the Notes established as contemplated hereunder and
thereunder.

 

“Indenture Trustee” means, unless otherwise
specified in this Indenture, The Bank of New York and, subject to the
provisions of Article 7 hereof, shall also include its successors and
assigns as Indenture Trustee hereunder.

 

“Interest Payment Date” means, with respect
to the Notes, each date on which interest is paid to the Holders of the Notes
as specified in this Indenture.

 

“Investment Company Act” means the
Investment Company Act of 1940, as amended, as it may be amended or
supplemented from time to time, and any successor statute thereto, and the
rules, regulations and published interpretations of the Commission promulgated
thereunder from time to time.

 

“Issuance Date” means the original date of issuance
of the Notes.

 

“LIBOR Notes” means Notes that bear interest
based on LIBOR (as defined in the Notes).

 

5

 

“License Agreement” means that certain
License Agreement between Wilmington, on behalf of the Trust and Protective
Life Corporation, dated as of the date specified in the Omnibus Instrument, as
the same may be amended, modified or supplemented from time to time.

 

“Lien” means any mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other), or preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including without limitation any
conditional sale or other title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing
of any financing statement under the UCC or comparable law of any
jurisdiction).

 

“Maturity Date” means, with respect to the
Notes, the date on which the principal of the Notes becomes due and payable as
therein or herein provided, whether at the Stated Maturity Date thereof or by
declaration of acceleration or otherwise.

 

“Nonrecourse Parties” has the meaning set
forth in Section 9.01.

 

“Note” means any note designated in this
Indenture and authenticated and delivered under this Indenture, which is in
registered form and may be represented by a Global Note or a Definitive Note,
and which shall be substantially in the forms attached as Exhibit A-1, Exhibit
A-2 and Exhibit A-3, and “Notes”
means the secured notes of the Trust represented by such Note.

 

“Notice of Default” has the meaning set
forth in Section 6.01.

 

“Office or Agency” means with respect to the
Notes, an office or agency of the Trust, the Indenture Trustee, the Paying
Agent or the Registrar, as the case may be, maintained or designated as the
Place of Payment for such Notes pursuant to Section 3.04 or any other
office or agency of the Trust, Indenture Trustee, Paying Agent or Registrar, as
the case may be, maintained or designated for such Notes pursuant to Section
3.04.

 

“Omnibus Instrument” means the omnibus
instrument pursuant to which certain Program Documents are executed and the
Trust is established.

 

“Opinion of Counsel” means a written opinion
addressed to the Indenture Trustee (among other addressees) by legal counsel,
who may be internal legal counsel to Protective Life, who may, except as
otherwise expressly provided in this Indenture, be counsel for the Trust or
Protective Life  or other counsel
and who shall be reasonably satisfactory to the Indenture Trustee.

 

“Outstanding” means, with respect to the
Notes, as of any date of determination, all of the Notes theretofore
authenticated and delivered under this Indenture or in one or more indentures
supplemental hereto or thereto, except:

 

(i)                                     Notes
theretofore cancelled by the Indenture Trustee or delivered to the Indenture
Trustee for cancellation;

 

6

 

(ii)                                  Notes
or portions thereof for the payment or redemption of which money in the
necessary amount has been theretofore deposited with the Indenture Trustee or
any Paying Agent in trust for the Holders of such Notes, provided that, if such Notes are to be
redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Indenture Trustee has been
made;

 

(iii)                               Notes
in exchange for or in lieu of which other Notes have been authenticated and
delivered pursuant to this Indenture unless proof satisfactory to the Indenture
Trustee is presented that any such Notes are held by a holder in due course;

 

(iv)                              Notes
alleged to have been destroyed, lost, stolen or mutilated and surrendered to
the Indenture Trustee for which either replacement Notes have been issued or
payment has been made as provided for in Section 2.08 unless proof
satisfactory to the Indenture Trustee is presented that any such Notes are held
by a holder in due course; and

 

(v)                                 Notes
represented by Global Notes to the extent that they shall have been duly
exchanged for Definitive Notes pursuant to this Indenture unless proof
satisfactory to the Indenture Trustee is presented that any such Notes are held
by a holder in due course;

 

provided further, however, that in determining
whether the Holders of the requisite percentage of the principal amount of the
Outstanding Notes have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Notes owned by the Trust or any Affiliate
of the Trust shall be disregarded and deemed not to be Outstanding, except that
in determining whether the Indenture Trustee shall be protected in relying upon
any such request, demand, authorization, direction, notice, consent or waiver,
only Notes that the Indenture Trustee knows to be so owned shall be so
disregarded.  Notes so owned that have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Indenture Trustee that the pledgee is
entitled so to act with respect to such Notes and that the pledgee is not the
Trust or any Affiliate of the Trust.

 

“Paying Agent” means, unless otherwise
specified in this Indenture or a supplemental indenture, the Indenture Trustee,
in its capacity as paying agent under this Indenture or its successors or assigns.

 

“Person” means any natural person,
corporation, limited partnership, general partnership, joint stock company,
joint venture, association, company, limited liability company, trust
(including any beneficiary thereof), bank, trust company, land trust, business
trust or other organization, whether or not a legal entity, and governments and
agencies and political subdivisions thereof.

 

“Place of Payment” means the place where the
principal of, premium, if any, and interest on the Notes are payable which,
unless otherwise specified in this Indenture, shall be the address specified in
Section 1.05 for the Indenture Trustee.

 

7

 

“Pricing Supplement” means the pricing
supplement attached to the Omnibus Instrument as Exhibit G as prepared by the
Trust in connection with the issuance by the Trust of its Notes and agreed to
by Protective Life, the Trust and the relevant dealers or agents appointed
under the Distribution Agreement and/or Selling Agent Agreement, as the case
may be, as such Pricing Supplement may be amended, modified, supplemented or
replaced from time to time.

 

“Principal Financial Center” means, as
applicable, the capital city of the country issuing the Specified Currency; provided, however, that with respect to
United States Dollars, Australian dollars, Canadian dollars, and Swiss francs,
the “Principal Financial Center” shall be The City of New York, Sydney, Toronto
and Zurich, respectively.

 

“Proceeds” means all of the proceeds of, and
all other profits, products, rents, principal payments, interest payments or
other receipts, in whatever form, arising from the collection, sale, lease,
exchange, assignment, licensing or other disposition or maturity of, or other
realization upon, a Funding Agreement, including without limitation all claims
of the Trust against third parties for loss of, damage to or destruction of, or
for proceeds payable under, a Funding Agreement, in each case whether now
existing or hereafter arising.

 

“Program” means, the Secured Note Program of
the Protective Life Secured Trusts.

 

“Program Documents” means this Indenture,
each Note, the Omnibus Instrument, the Trust Agreement, the Funding Agreement,
the Distribution Agreement, the Selling Agent Agreement, the Administrative Services
Agreement, the License Agreement and the Expense and Indemnity Agreement and
any other documents or instruments entered into by, with respect to, or on
behalf of, the Trust.

 

“Protective Life” means Protective Life
Insurance Company, a Tennessee insurance company, or any successor thereto.

 

“Rating Agency” means any rating agency that
has rated either the Program for the issuance of Notes as set forth in the
Registration Statement or the Notes.

 

“Redemption Price” means the price at which
the Notes are to be redeemed pursuant to Section 2.04, as set forth in
the applicable Pricing Supplement or a supplemental indenture.

 

“Register” has the meaning set forth in Section
2.06.

 

“Registrar” means, unless otherwise
specified in this Indenture or a supplemental indenture, the Indenture Trustee,
in its capacity as registrar under this Indenture, or its successors or
assigns.

 

“Registration Statement” means (a) a
registration statement on Form S-3 or other appropriate form, including the
prospectus, prospectus supplements and the exhibits included therein, any
pre-effective or post-effective amendments thereto and any registration
statements filed subsequent thereto under rules promulgated under the
Securities Act, relating to the registration under the Securities Act of the
Notes of the Trust and the Funding Agreement, (b) any preliminary prospectus or
prospectus supplements thereto relating to the Notes of the Trust required to
be filed pursuant to the Securities Act and any documents or filings incorporated

 

8

 

therein by reference, and (c) a
registration statement and such other documents, forms or filings as may be
required by the Securities Act or the Trust Indenture Act, or other securities
laws in each case relating to the  Notes
of the Trust.

 

“Regular Record Date” for the interest
payable on any Interest Payment Date on the Notes means the date specified for
that purpose in such Note or this Indenture.

 

“Relevant Financial Center” means such
financial center or centers as may be specified in the relevant Pricing
Supplement in relation to the relevant currency for the purposes of the
definition of “Specified Business Day.”

 

“Relevant Purchasing Agent” means the lead
purchasing agent (in a firm commitment offering of Notes) or lead selling agent
(in a best efforts offering of Notes) appointed pursuant to the Distribution
Agreement or the Selling Agent Agreement, as the case may be.

 

“Responsible Officer” means, with respect to
the Indenture Trustee or Wilmington, any vice president, assistant vice
president, any assistant secretary, any assistant treasurer, any trust officer
or assistant trust officer, or any other officer of the Indenture Trustee or
Wilmington, as the case may be, customarily performing functions similar to
those performed by any of the above designated officers and also, with respect
to a particular corporate trust matter, any other officer to whom such matter
is referred because of his or her knowledge of and familiarity with the particular
subject, and also, with respect to Wilmington, having direct responsibility for
the administration of the Trust, or with respect to the Indenture Trustee,
having direct responsibility for the administration of this Indenture.

 

“Secured Obligations” means the obligations
of the Trust secured under the Notes and this Indenture, including (i) all
principal of, premium, if any, and interest (including, without limitation, any
interest which accrues after the commencement of any case, proceeding or other
action relating to the bankruptcy, insolvency or reorganization of the Trust,
whether or not allowed or allowable as a claim in any such proceeding) on such
Notes or pursuant to this Indenture, (ii) all other amounts payable by the
Trust hereunder or under such Notes including all Additional Amounts (if
applicable) and all costs and expenses (including without limitation attorneys’
fees) incurred by the Indenture Trustee (to the extent not paid pursuant to the
Expense and Indemnity Agreement) and (iii) any renewals or extensions of the
foregoing.

 

“Securities Act” means the Securities Act of
1933, as it may be amended or supplemented from time to time, and any successor
statute thereto, and the rules, regulations and published interpretations of
the Commission promulgated thereunder from time to time.

 

“Securities Exchange Act” means the
Securities Exchange Act of 1934, as it may be amended or supplemented from time
to time, and any successor statute thereto, and the rules, regulations and
published interpretations of the Commission promulgated thereunder from time to
time.

 

“Selling Agent Agreement” means that certain
Selling Agent Agreement, dated as of the date specified in the Omnibus
Instrument, by and among the Trust, Protective Life and the agents named therein
relating to the issuance and sale of the Notes under the Trust’s InterNotes®
Program, as the same may be amended, modified or supplemented.

 

9

 

“Series of Notes” means
the series of Notes issued by the Trust; and a Series of Notes may comprise
Notes in more than one denomination.

 

“Special Record Date” means a date fixed by
the Indenture Trustee pursuant to Section 2.09 for the payment of any
Defaulted Interest on any Note.

 

“Specified Business Day” means a day (other
than a Saturday or Sunday or a legal holiday) on which commercial banks and
foreign exchange markets are generally open for business and settle payments in
the Relevant Financial Center in respect of the Notes or, in relation to Notes
payable in euro, a day on which the TARGET System is operating and, in either
case, a day (other than a Saturday or Sunday) on which commercial banks are
generally open for business and foreign exchange markets settle payments in any
place specified in the relevant Pricing Supplement.

 

“Specified Currency” means the currency in
which the Notes are denominated (or, if such currency is no longer legal tender
for the payment of public and private debts in the country issuing such
currency or, in the case of euro, in the member states of the European Union
that have adopted the single currency in accordance with the Treaty on
establishing the European Community, as amended by the Treaty on European
Union, such currency which is then such legal tender).

 

“Standard Indenture Terms” means this
document, the Standard Indenture Terms.

 

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

 

“Sterling” means such coin or currency of
the United Kingdom as at the time shall be legal tender for the payment of
public or private debts.

 

“TARGET System”  means the Trans-European Automated Real-Time Gross Settlement
Express Transfer System.

 

“Transfer Agent” means, unless otherwise
specified in this Indenture or a supplemental indenture, the Indenture Trustee,
in its capacity as transfer agent under this Indenture or its successors or
assigns.

 

“Treasury Regulations” means the regulations
promulgated by the United States Treasury Department pursuant to the Code.

 

“Trust” means the Protective Life Secured
Trust specified in the Omnibus Instrument, which shall be a statutory trust or
a common law trust (as indicated in the Pricing Supplement), formed under the
laws of the State of Delaware, in the case of a common law trust, acting by and
through Wilmington and/or the Administrator, as the case may be, together with
its permitted successors and assigns.

 

10

 

“Trust Agreement” means that certain
Statutory Trust Agreement or Common Law Trust Agreement, as applicable,
included in the Omnibus Instrument, declaring and establishing the Trust, as
may be amended, modified or supplemented from time to time.

 

“Trust Beneficial Interest” has the meaning
set forth in the Trust Agreement.

 

“Trust Beneficial Owner” means the
beneficial owner of the Trust Beneficial Interest.

 

“Trust Certificate” means a certificate
signed by one or more Responsible Officers of Wilmington on behalf of the Trust
and delivered to the Indenture Trustee.

 

“Trust Indenture Act” means the Trust
Indenture Act of 1939, as it may be amended or supplemented from time to time,
and any successor statute thereto, and the rules, regulations and published
interpretations of the Commission promulgated thereunder from time to time.

 

“Trust Order” or “Trust Request” means a written statement, request or order of
the Trust signed in its name by Wilmington and delivered to the Indenture
Trustee.

 

“UCC” means the Uniform Commercial Code, as
from time to time in effect in the State of New York; provided that, with respect to the
perfection, effect of perfection or non-perfection, or priority of any security
interest in the Collateral, “UCC” shall mean the Uniform Commercial Code, as
from time to time in effect in the applicable jurisdiction whose law governs
such perfection, non-perfection or priority.

 

“United States” means the United States of
America (including the States and the District of Columbia), its territories,
its possessions and other areas subject to its jurisdiction.

 

“Wilmington” means, unless otherwise
specified in this Indenture, Wilmington Trust Company, not in its individual
capacity, but solely as Trustee under the Trust Agreement, and shall also
include its permitted successors and assigns hereunder.

 

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

 

SECTION 1.03. 
Form of Documents Delivered to
Indenture Trustee.

 

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

 

11

 

(b)                                 Any
certificate or opinion of the Trust may be based, insofar as it relates to
legal matters, upon a certificate or opinion of, or representations by,
counsel, unless the Trust knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to the
matters upon which its certificate or opinion is based are erroneous. Any such
certificate or opinion or any Opinion of Counsel may be based, insofar as it
relates to factual matters, upon a certificate or opinion of, or
representations by, the Trust stating that the information with respect to such
factual matters is in the possession of the Trust, unless such counsel knows,
or in the exercise of reasonable care should know, that the certificate or
opinion or representations with respect to such matters are erroneous.  Any Opinion of Counsel may be based on the
written opinion of other counsel, in which event such Opinion of Counsel shall
be accompanied by a copy of such other counsel’s opinion and shall include a
statement to the effect that such counsel believes that such counsel and the
Indenture Trustee may reasonably rely upon the opinion of such other
counsel.  Any certificate or opinion of
the Trust or of counsel may be based, insofar as it relates to accounting
matters, upon a certificate or opinion of or representations by an accountant
or firm of accountants in the employ of Protective Life or the Trust, unless
the Trust knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to the accounting
matters upon which its certificate, statement or opinion is based are
erroneous.

 

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

 

(d)                                 Wherever
in this Indenture, in connection with any application or certificate or report
to the Indenture Trustee, it is provided that the Trust shall deliver any
document as a condition of the granting of such application, or as evidence of
compliance with any term hereof, it is intended that the truth and accuracy, at
the time of the granting of such application or at the effective date of such
certificate or report (as the case may be), of the facts and opinions stated in
such document shall in such case be conditions precedent to the right of the
Trust to have such application granted or to the sufficiency of such
certificate or report. The foregoing shall not, however, be construed to limit
the Indenture Trustee’s right to rely upon the truth and accuracy of any
statement or opinion contained in any such document as provided in Section
7.01.

 

(e)                                  Every
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture (including one furnished pursuant to specific
requirements of this Indenture relating to a particular application or request)
shall substantially include:

 

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

 

(ii)                                  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;

 

12

 

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

 

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

 

SECTION 1.04. 
Acts of Holders.

 

(a)                                  Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by any Holder may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holder in person or by one or more agents duly appointed
in writing.  Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Holders may, alternatively, be embodied
in and evidenced by the record of Holders of Notes voting in favor thereof,
either in person or by proxies duly appointed in writing, at any meeting of
Holders of Notes duly called and held in accordance with the provisions of Article
10, or a combination of such instruments and any such record.  Except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments or record or both are delivered to the Indenture Trustee.  Such instrument or instruments and any such
record (and the action embodied therein and evidenced thereby) are herein
sometimes referred to as the “Act”
of the Holders signing such instrument or instruments or so voting at any
meeting.  Proof of execution of any such
instrument or of writing appointing any such agent, or of the holding by any
Person of a Note, shall be sufficient for any purpose of this Indenture and
(subject to Section 7.01) conclusive in favor of the Indenture Trustee,
and the Trust, if made in the manner provided in this Section 1.04.  The record of any meeting of Holders of
Notes shall be proved in the manner provided in Section 10.06.  Without
limiting the generality of this Section 1.04, unless otherwise provided
in or pursuant to this Indenture, a Clearing System that is or whose nominee is
a Holder of a Global Note may allow its account holders who have beneficial
interests in such Global Note credited to accounts with such Clearing System to
direct such Clearing System in taking such action through such Clearing
System’s standing instructions and customary practices.  The Clearing System shall report only one
result of its solicitation of proxies to the Indenture Trustee.

 

(b)                                 Subject
to Section 7.01, the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by the
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such
instrument or writing acknowledged to him or her the execution thereof.  Whenever such execution is by a signer
acting in a capacity other than his or her individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his or her
authority.  The fact and date of the
execution of any such instrument or writing, or the authority of the Person
executing the same, may be proved in any other manner that the Indenture
Trustee deems sufficient.

 

13

 

(c)                                  The
ownership, principal amount and serial numbers of Notes held by any Person, and
the date of the commencement and the date of the termination of holding the
same, shall be proved by the Register.

 

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

 

(e)                                  Except
as provided in subsection (f) below, if the Trust shall solicit from the
Holders of Notes any Act referred to in Section 1.04(a), the Trust may, at
its option, fix in advance a record date for the determination of Holders
entitled to vote or consent in 
connection with any such Act, but the Trust shall have no obligation to
do so.  If such record date is fixed,
such Act may be given after such record date, but only the Holders of record at
the close of business on such record date shall be deemed to be Holders for the
purposes of determining whether Holders of the requisite proportion of
Outstanding Notes have authorized or agreed or consented to such Act, and for
that purpose the Outstanding Notes shall be computed as of such record date; provided, that no such Act by Holders on
such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after
the record date.  Nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Notes on the date such action
is taken.  Promptly after any record
date is set pursuant to this paragraph, the Trust shall cause notice of such
record date and the proposed action by Holders to be given to the Indenture
Trustee in writing and to each Holder of the Notes in the manner set forth in Section
1.06.

 

(f)                                    The
Indenture Trustee may set any day as a record date for the purpose of
determining the Holders entitled to join in the giving or making of (i) any
notice delivered pursuant to Section 6.01(d), (ii) any declaration of
acceleration referred to in Section 6.02, (iii) any request to institute
proceedings referred to in Section 6.07(b) or (iv) any direction
referred to in Section 6.12.  If
such a record date is fixed pursuant to this paragraph, the relevant action may
be taken or given after such record date, but only the Holders of record at the
close of business on such record date shall be deemed to be Holders for the
purposes of determining whether Holders of the requisite proportion of
Outstanding Notes have authorized or agreed or consented to such action, and
for that purpose the Outstanding Notes shall be computed as of such record
date; provided, that no such
action by Holders on such record date shall be deemed effective unless it shall
become effective pursuant to the 
provisions of this Indenture not later than six months  after the record date.  Nothing in this paragraph shall be construed
to prevent the Indenture Trustee from setting a new record date for any action
for which a record date has previously been set pursuant to this paragraph
(whereupon the record date previously set shall automatically and with no
action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Notes on the date such action
is taken.  Promptly after any record
date is set pursuant to this paragraph, the Indenture Trustee shall cause
notice of such record date and the proposed action by Holders to be given to
the Trust in writing and to each Holder of the Notes in the manner set forth in
Section 1.06.

 

14

 

SECTION 1.05. 
Notices.  Any request, demand, authorization,
direction, notice, consent, waiver or other action required or permitted by this
Indenture to be made upon, given or furnished to, or filed with, the Indenture
Trustee, the Registrar, the Transfer Agent, the Paying Agent, the Calculation
Agent, the Trust and the Rating Agencies shall be sufficient for every purpose
hereunder (unless otherwise herein expressly provided) if in writing and sent
by fax, telex, or mailed, first-class mail or overnight courier, in each case
postage prepaid, at the address specified in this Section 1.05 or at any
other address previously furnished in writing.

 

	
  Such notices
  shall be addressed

  
	
   

  
	
  if to the
  Indenture Trustee, to:

  
	
   

  
	
  The Bank of
  New York

  
	
  100 Church
  Street

  
	
  8th
  Floor

  
	
  New York,
  New York  10286

  
	
  Facsimile:
  (212) 437-6151

  
	
  Attention:  Dealing and Trading

  
	
   

  
	
  if to the
  Registrar, Transfer Agent, Paying Agent and Calculation Agent, to:

  
	
   

  
	
  The Bank of
  New York

  
	
  100 Church
  Street

  
	
  8th
  Floor

  
	
  New York,
  New York  10286

  
	
  Facsimile:
  (212) 437-6151

  
	
  Attention:
  Dealing and Trading

  
	
   

  
	
  if to the
  Trust, to:

  
	
   

  
	
  Protective
  Life Secured Trust (followed by the number of the Trust designated in the
  Omnibus Instrument)

  
	
  c/o
  Wilmington Trust Company

  
	
  Rodney
  Square North

  
	
  1100 North
  Market Street

  
	
  Wilmington,
  Delaware  19890-0001

  
	
  Facsimile:
  (302) 636-4140

  
	
  Attention:  Corporate Trust Administration

  
	
   

  
	
  if to the
  Rating Agencies, to:

  
	
   

  
	
  Standard
  & Poor’s Rating Services

  
	
  55 Water
  Street

  
	
  33rd
  Floor

  
	
  New York,
  New York  10041

  
	
  Facsimile:
  (212) 438-5215

  
	
  Attention:  Capital Markets Group

  

 

15

 

	
  Moody’s
  Investors Service, Inc.

  
	
  Life
  Insurance Group

  
	
  99 Church
  Street

  
	
  New York,
  New York  10007

  
	
  Facsimile:  (212) 553-4805

  
	
  Attention:  Protective Life Secured Trusts

  
	
   

  
	
  or at such
  other address previously furnished in writing by one party to the other.

  

 

SECTION 1.06. 
Notice to Holders; Waiver.

 

(a)                                  Except
as otherwise expressly provided in or pursuant to this Indenture, notices to
Holders required under the Notes shall be sufficiently given upon the mailing
by overnight courier or first-class mail (or equivalent), or (if posted to an
overseas address) by airmail, postage prepaid, of such notices to each Holder
of the Notes at their registered addresses as recorded in the Register.

 

(b)                                 Where
this Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Indenture Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.  In any case,
neither the failure to give such notice, nor any defect in any notice to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders, and any notice which is mailed in the manner herein provided
shall be conclusively presumed to have been duly given.

 

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

 

SECTION 1.07. 
Severability.  In case any provision in or
obligation under this Indenture or the Notes shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby to
the fullest extent permitted under applicable law.

 

SECTION 1.08. 
Successors and Assigns.  All covenants, stipulations,
promises and agreements in this Indenture by the Trust shall bind its
successors and assigns, whether so expressed or not.

 

SECTION 1.09. 
Benefits of Indenture.  Nothing in this Indenture or in
any Note, expressed or implied, shall give to any Person other than the parties
hereto and their successors and the Holders, any legal or equitable right,
remedy or claim under this Indenture.

 

16

 

SECTION 1.10. 
Language of Notices.  Any request, demand,
authorization, direction, notice, consent, election or waiver required or
permitted under this Indenture shall be in the English language, except that,
if the Trust so elects, any published notice may be in an official language of
the country of publication.

 

SECTION 1.11. 
Governing Law.

 

(a)                                  This
Indenture and the Notes (unless otherwise specified in the Pricing Supplement)
shall be governed by, and construed in accordance with, the laws of the State
of New York without regard to conflict of law principles, except as required by
mandatory provisions of law and except to the extent that the validity or
perfection of the Trust’s ownership of the Funding Agreements, the perfection
of the Indenture Trustee’s security interest therein, or remedies under this
Indenture in respect thereof may be governed by laws of a jurisdiction other
than the State of New York.

 

(b)                                 ALL
JUDICIAL PROCEEDINGS BROUGHT AGAINST THE TRUST, THE ASSETS OF THE TRUST, THE
INDENTURE TRUSTEE, REGISTRAR, TRANSFER AGENT OR PAYING AGENT OR ANY OTHER
AGENT, ARISING OUT OF OR RELATING TO THIS INDENTURE, ANY NOTE OR ANY PORTION OF
THE COLLATERAL MAY BE BROUGHT IN A UNITED STATES FEDERAL COURT LOCATED IN NEW
YORK CITY, THE BOROUGH OF MANHATTAN, AND BY EXECUTION AND DELIVERY OF THIS
INDENTURE EACH OF THE TRUST, THE INDENTURE TRUSTEE,  THE REGISTRAR, THE TRANSFER AGENT, THE PAYING AGENT, AND ANY
OTHER AGENT, (IN SUCH CAPACITIES) ACCEPT 
(AND WITH RESPECT TO THE TRUST, IN CONNECTION WITH ITS PROPERTY
ACCEPTS), GENERALLY AND UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE
AFORESAID COURT AND WAIVE ANY DEFENSE OF FORUM NON CONVENIENS AND IRREVOCABLY
AGREE TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS
INDENTURE, ANY NOTE OR ANY PORTION OF THE COLLATERAL.

 

SECTION 1.12. 
Waiver of Jury Trial.  EACH OF THE PARTIES TO THIS INDENTURE HEREBY
AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF THIS INDENTURE, THE NOTES OR ANY DEALINGS
AMONG THEM RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION.  The scope of this waiver is intended to
encompass any and all disputes that may be filed in any court and that relate
to the subject matter of this transaction including without limitation contract
claims, tort claims, breach of duty claims, and all other common law and
statutory claims.  Each party hereto acknowledges
that this waiver is a material inducement to enter into a business
relationship, that such party has already relied on the waiver in entering into
this Indenture, and that such party will continue to rely on the waiver in its
related future dealings.  Each party
hereto further warrants and represents that it has reviewed this waiver with
its legal counsel, and that it knowingly and voluntarily waives its jury trial
rights following consultation with legal counsel.  THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED
EITHER ORALLY OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS

 

17

 

INDENTURE OR ANY OTHER
DOCUMENTS OR AGREEMENTS RELATING TO THIS INDENTURE.  In the event of litigation, this Indenture may be filed as a
written consent to a trial by the court.

 

SECTION 1.13. 
Counterparts.  This Indenture and any
amendments, waivers, consents or supplements hereto or thereto, may be executed
in any number of counterparts, and by different parties hereto in separate
counterparts, and each of which when so executed and delivered shall be deemed
an original, but all such counterparts together shall constitute but one and
the same instrument.  This Indenture
shall become effective upon the execution of a counterpart hereof by each of
the parties hereto.

 

SECTION 1.14. 
Third Party Beneficiaries.  This Indenture will inure to the benefit of
and be binding upon the parties hereto, and Wilmington and their respective
successors and permitted assigns.

 

SECTION 1.15. 
Conflict with Trust Indenture Act.  If any provision of this Indenture limits,
qualifies or conflicts with any duties imposed by any of Sections 310 to 317,
inclusive, of the Trust Indenture Act through operation of Section 318(c)
thereof, such imposed duties shall control.

 

ARTICLE 2

The Notes

 

SECTION 2.01. 
Forms Generally.

 

(a)                                  The
Notes constitute direct, unconditional, unsubordinated and secured non-recourse
obligations of the Trust and rank equally among themselves.  The Notes shall be in substantially the form
set forth in Exhibit A-1, Exhibit A-2 and Exhibit A-3
attached hereto, as applicable, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required by this Indenture
or as may in the Trust’s judgment be necessary, appropriate or convenient to
permit such Notes to be issued and sold, or to comply, or facilitate
compliance, with applicable laws, and may have such letters, numbers or other
marks of identification and such legends or endorsements placed thereon as may
be required to comply with the rules of any securities exchange on which such
Notes may be listed, or as may, consistently herewith, be determined by the
Trust (based conclusively on the advice of counsel) as evidenced by its
execution thereof.  Any portion of the
text of any Note may be set forth on the reverse thereof with an appropriate
reference on the face of the Note.

 

(b)                                 The
terms and provisions contained in the Notes shall constitute, and are hereby
expressly made a part of this Indenture, and, to the extent applicable, the
Indenture Trustee, by its execution and delivery of this Indenture, and the
Trust by its execution and delivery of this Indenture, expressly agrees to such
terms and provisions and to be bound thereby.

 

(c)                                  Except
as described in this Section 2.01(c), no Global Note evidencing any of
the Notes and deposited with or on behalf of any Clearing System shall be
exchangeable for Definitive Notes. 
Subject to the foregoing sentence, if (i) such Clearing System notifies
the Trust that it is unwilling or unable to continue as Depositary or the Trust
becomes aware that the

 

18

 

Clearing System has ceased to
be a clearing agency registered under the Securities Exchange Act and in any
such case the Trust fails to appoint a successor depositary within ninety (90)
days, (ii) an Event of Default shall have occurred and is continuing with
respect to the Notes or (iii) the Trust shall have decided in its sole
discretion that the Notes should no longer be evidenced solely by one or more
Global Notes, then, pursuant to written instructions by the Trust to the
Indenture Trustee (in the case of clause (i)), or upon written request of the
Holder (or accountholder of such Clearing System with an interest in the Notes)
(in the case of clause (ii)), or pursuant to written instructions by the Trust
to the Indenture Trustee and Clearing System (in the case of clause (iii)):

 

(A)                              with
respect to each Global Note evidencing such Notes, the Trust shall execute, and
the Indenture Trustee shall authenticate and deliver Definitive Notes in
authorized denominations in exchange for the Global Note, in an aggregate
principal amount equal to the Outstanding principal amount of the related
Global Note.  Upon the exchange of the
Global Note for the Definitive Notes, such Global Note shall be cancelled by
the Registrar.  Definitive Notes issued
in exchange for a Global Note pursuant to this Section 2.01(c) shall be
registered in the Register in such names and in such denominations as the
Clearing System for such Global Note, pursuant to the instructions from its
direct or indirect participants or otherwise, shall instruct the Indenture
Trustee, serving as custodian, on behalf of the nominee of the Depositary, of
the Global Note.  The Indenture Trustee
shall immediately provide the information to the Registrar.  Immediately after the authentication of the
Definitive Notes by the Indenture Trustee, the Indenture Trustee shall deliver
such Definitive Notes to the Holders of such Notes;

 

(B)                                if
Definitive Notes are issued in exchange for any portion of a Global Note after
the close of business at the Office or Agency for such Note where such exchange
occurs on (1) any Regular Record Date for such Notes and before the opening of
business at such Office or Agency on the next Interest Payment Date, or (2) any
Special Record Date for such Notes and before the opening of business at such
Office or Agency on the related proposed date for payment of interest or
Defaulted Interest, as the case may be, interest shall not be payable on such
Interest Payment Date or proposed date for payment, as the case may be, in
respect of such Definitive Notes, but shall be payable on such Interest Payment
Date or proposed date for payment, as the case may be, only to the Person to
whom interest in respect of such portion of such Global Note shall be payable
in accordance with the provisions of this Indenture; and

 

(C)                                if
for any reason Definitive Notes are not issued, authenticated and delivered to
the Holders in accordance with paragraph (A) of this Section 2.01(c),
then:

 

(1)                                  the Clearing System
or its successors may provide to each of its accountholders a statement of such
accountholder’s interest in the Notes evidenced by each Global Note held by
such Clearing System or its successors, together with a copy of such Global
Note; and

 

19

 

(2)                                  subject to the
limitations on individual Holder action contained in the Notes or this
Indenture, each such accountholder or its successors and assigns (x) shall have
a claim, directly against the Trust, for the payment of any amount due or to
become due in respect of such accountholder’s interest in the Notes evidenced
by such Global Note, and shall be empowered to bring any claim, to the extent
of such accountholder’s interest in the Notes evidenced by such Global Note and
to the exclusion of such Clearing System or its successors, that as a matter of
law could be brought by the Holder of such Global Note and the Person in whose
name the Notes are registered and (y) may, without the consent and to the
exclusion of such Clearing System or its successors, file any claim, take any
action or institute any proceeding, directly against the Trust, to compel the
payment of such amount or enforce any such rights, as fully as though the
interest of such accountholder in the Notes evidenced by such Global Note were
evidenced by a Definitive Note in such accountholder’s actual possession and as
if an amount of Notes equal to such accountholder’s stated interest were
registered in such accountholder’s name and without the need to produce such
Global Note in its original form.

 

Notwithstanding
anything in this paragraph (C) to the contrary, the Indenture Trustee shall not
be required to recognize any account holder or any of its successors and
assigns referred to in said paragraph as a Holder for any purpose of this
Indenture or the Notes and shall be entitled to treat the Person in whose name
the Global Note is registered as a Holder for all purposes of this Indenture
and the Notes until Definitive Notes are issued to and registered in the names
of such accountholders or their successors and assigns.

 

The account records of any Clearing
System or its successor shall, in the absence of manifest error, be conclusive
evidence of the identity of each accountholder that has any interest in the
Notes evidenced by the Global Note held by such Clearing System or its
successor and the amount of such interest. Definitive Notes shall be issued
only in denominations as specified in the relevant Pricing Supplement.

 

(d)                                 Subject
to the other provisions of this Indenture, if any Global Note is exchanged for
Definitive Notes, then:

 

(i)                                     the
Trust, the Indenture Trustee and any Paying Agent will have the right to treat
each Holder of Definitive Notes as the Person exclusively entitled to receive
interest and other payments or property in respect of or in exchange for the
Notes, and otherwise to exercise all the rights and powers with respect to any
Note (subject to the record date provisions hereof and of the Notes); and

 

20

 

(ii)                                  the
obligation of the Trust to make payments of principal, premium, if any,
interest and other amounts with respect to the relevant Notes shall be
discharged at the time payment in the appropriate amount is made in accordance
with this Indenture to each Holder.

 

SECTION 2.02. 
No Limitation on Aggregate Principal
Amount of Notes.  The
aggregate principal amount of Notes which may be authenticated and delivered
under this Indenture is unlimited. 
Unless otherwise specified in the applicable Pricing Supplement, Notes
shall be issued in denominations of $1,000 and any larger amount that is a
multiple of $1,000; the authorized denominations of Notes that have a Specified
Currency other than U.S. Dollars will be the approximate equivalent in such
Specified Currency.  The specific terms
and conditions of each Series of Notes shall be set out in a Pricing Supplement
and, if applicable, a supplemental indenture entered into pursuant to Section
8.01(h) of this Indenture.

 

SECTION 2.03. 
Listing.  If specified in the Pricing Supplement, the Notes will
be listed on the securities exchange set forth in such Pricing Supplement.

 

SECTION 2.04. 
Redemption.

 

(a)                                  Except
as otherwise provided in the Pricing Supplement or a supplemental indenture and
the Notes or in Section 6.02, the Trust will redeem the Notes only if
Protective Life redeems the Funding Agreement securing such Notes in an amount
equal to the amount of the related Notes to be redeemed whether in accordance
with the terms of this Indenture or the Pricing Supplement, and the Trust will
not redeem the Notes if Protective Life does not redeem the Funding
Agreement(s) securing such Notes in an amount equal to the amount of the Notes
to be redeemed in accordance herewith. 
Unless otherwise specified in the relevant Pricing Supplement or a
supplemental indenture and the Notes, the Trust may not redeem the Notes after
the date that is thirty (30) days prior to the Stated Maturity Date of the
Notes.

 

(b)                                 If,
but only if, specified in the Pricing Supplement or a supplemental indenture
and the Notes, such Notes will be repayable at the option of the Holders
thereof in accordance with the repayment provisions included in the Pricing
Supplement or supplemental indenture and the Notes.

 

(c)                                  In
connection with the redemption by the Trust of the Notes under Section
2.04(a) hereunder, the Trust will give written notice to the Holders in
accordance with Section 1.06 hereunder not less than thirty (30) days
and no more than seventy-five (75) days prior to the date set for such
redemption.  All notices of redemption
shall state:

 

(i)                                     the
redemption date;

 

(ii)                                  the
Redemption Price or, if not then ascertainable, the manner of calculation
thereof;

 

(iii)                               that
on the redemption date the Redemption Price will become due and payable on the
Notes to be redeemed and that interest thereon will cease to accrue on and after
said date; and

 

21

 

(iv)                              the
place or places where the Notes to be redeemed are to be surrendered for
payment of the Redemption Price.

 

(d)                                 Prior
to any redemption date, the Trust shall deposit with the Paying Agent an amount
of money sufficient to pay the Redemption Price of and (except if the
redemption date shall be an Interest Payment Date) accrued and unpaid interest
on, all Notes which are to be redeemed on that date.

 

(e)                                  Upon
notice of redemption having been given pursuant to Section 2.04(c)
hereunder, the Notes to be so redeemed shall, on the redemption date, become
due and payable at the Redemption Price therein specified, and from and after
such date (unless the Trust shall default in the payment of the Redemption
Price and accrued interest, if any) such Notes shall cease to bear or accrue
any interest.  Upon surrender of the
Notes for redemption in accordance with said notice, such Notes shall be paid
by the Trust at the Redemption Price, together with any accrued but unpaid
interest to, but not including the redemption date provided that, installments of interest whose Stated
Maturity Date is on or prior to the redemption date will be payable to the
Holders of such Notes, or one or more predecessor Notes, registered as such at
the close of business on the relevant Record Date according to their terms and
the provisions of Section 2.09.

 

(f)                                    The
election of the Trust to redeem any Notes shall be evidenced by a Trust
Certificate.  In case of any redemption
at the election of the Trust, the Trust shall, at least forty-five (45) days
prior to the redemption date fixed by the Trust (unless a shorter notice shall
be satisfactory to the Indenture Trustee), notify the Indenture Trustee of such
redemption date, and of the principal amount of Notes to be redeemed.  In the case of any redemption of Notes (a)
prior to the expiration of any restriction on such redemption provided in the
terms of such Notes or elsewhere in this Indenture, or (b) pursuant to an election
of the Trust which is subject to a condition specified in the terms of such
Notes or elsewhere in this Indenture, the Trust shall furnish the Indenture
Trustee with a Trust Certificate evidencing compliance with such restriction or
condition.

 

(g)                                 If
less than all of the Notes are to be redeemed (unless such redemption affects
only a single Note), the particular Notes to be redeemed shall be selected not
more than seventy-five (75) days prior to the redemption date by the Indenture
Trustee, from the Outstanding Notes not previously called for redemption, by
lot or, if the particular Notes to be redeemed are not issued in book-entry
form, in its discretion, on a pro rata basis, in accordance with the customary
procedures of the Indenture Trustee; provided
that the unredeemed portion of the principal amount of any Note shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Note.

 

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

 

For all
purposes of this Indenture, unless the context otherwise requires, all provisions
relating to the redemption of Notes shall relate, in the case of any Notes
redeemed or 

 

22

 

to be redeemed only in part, to
the portion of the principal amount of such Notes which has been or is to be
redeemed.

 

(h)                                 Any
Note which is to be redeemed only in part shall be surrendered at a Place of
Payment therefor (with, if the Trust or the Indenture Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Trust and the Indenture Trustee duly executed by, the Holder thereof or his
attorney duly authorized in writing), and the Trust shall execute, and the
Indenture Trustee shall authenticate and deliver to the Holder of such Note
without service charge, a new Note or Notes, of any authorized denomination as
requested by such Holder, in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Note so
surrendered.

 

SECTION 2.05. 
Execution, Authentication and Delivery
Generally.

 

(a)                                  Upon
the execution of any Distribution Agreement or Selling Agent Agreement (if the
Dealers agree to purchase the Notes on a principal basis), the acceptance of an
offer to purchase Notes solicited by a Dealer on an agency basis, or the acceptance
of a direct offer of Notes for sale by the Trust, the Trust shall, as soon as
practicable but in any event (unless otherwise agreed by the parties), not
later than 1:00 p.m. (New York time) on the second Banking Day prior to the
proposed Issuance Date:

 

(i)                                     confirm
by fax to the Indenture Trustee, the Paying Agent and the Registrar, all such
information as the Indenture Trustee, the Paying Agent or the Registrar may
reasonably require to carry out their respective functions under this
Indenture, including, in particular, the settlement and payment procedures that
will apply to the Notes and, if applicable, the account of the Trust to which
payment should be made;

 

(ii)                                  deliver
a copy, of the Pricing Supplement or duly executed supplemental indenture to
the Indenture Trustee, the Paying Agent and the Registrar; and

 

(iii)                               unless
a Global Note is to be used and the Trust shall have provided such document to
the Registrar, ensure that there is delivered to the Registrar a stock of
Definitive Notes (in unauthenticated form and with the names of the registered
Holders left blank but executed on behalf of the Trust and otherwise complete)
in relation to the Notes.

 

(b)                                 The
Trust will deliver to the Indenture Trustee on the Issuance Date for the Series
of Notes a duly executed original of the Funding Agreement and Trust Agreement
(unless previously delivered) and all documentation relating to the foregoing
for the Notes.

 

(c)                                  The
Registrar shall, having been advised in accordance with Section 2.05(a)
on behalf of the Trust, on which securities exchange, if any, the Notes are to
be listed, deliver a copy of the Pricing Supplement or supplemental indenture
in relation to the Notes to such exchange or the relevant listing agent for
such exchange as soon as practicable but in any event no later than two (2)
Specified Business Days prior to the proposed Issuance Date therefor.

 

23

 

(d)                                 Having
received from the Trust the documents referred to in Section 2.05(a) and (b)
(to the extent applicable) (such documents constituting for all purposes of
this Indenture a Trust Order for the authentication and delivery of the Notes),
on or before 10:00 a.m. (New York time) on the Issuance Date in relation to the
Series of Notes (unless otherwise agreed by the parties), the Indenture Trustee
shall authenticate and deliver the relevant Global Note to the relevant
custodian for DTC and/or any other relevant Clearing System or otherwise in
accordance with such Clearing System’s procedures.  The Registrar shall give instructions to DTC and/or any other
relevant Clearing System to credit Notes represented by a Global Note
registered in the name of a nominee for such Clearing System, to the Registrar’s
distribution account and to hold each such Note to the order of the Trust
pending delivery to the Relevant Purchasing Agent(s) on a delivery against
payment basis (or on such other basis as shall have been agreed between the
Trust and the Relevant Purchasing Agent(s) and notified to the Registrar) in
accordance with the normal procedures of DTC or such other Clearing System, as
the case may be and, following payment (unless otherwise agreed), to debit the
Notes represented by such Global Note to such securities account(s) as shall
have been notified in writing to the Registrar by the Trust.  The Indenture Trustee shall on the Issuance
Date in respect of the Notes, and upon receipt of funds from the Relevant
Purchasing Agent(s), transfer, or cause to be transferred, the proceeds of
issue (net of any applicable commissions, fees or like amounts specified in
writing by Protective Life) to or as directed by Protective Life on behalf of
the Trust to satisfy the deposit requirement pursuant to the Funding Agreement
(as specified by Protective Life in such direction).

 

If no such
securities account(s) shall have been specified, or the Series of Notes not
intended to be cleared through any Clearing System, the Registrar shall
authenticate and make available at its specified office on the Issuance Date in
respect of the Series of Notes the relevant Global Note or the relevant
Definitive Notes, as the case may be, duly executed and made available to the
Registrar by the Trust.

 

(e)                                  If
the Indenture Trustee should pay an amount (an “advance”) to the Trust in the belief that a payment has been
or will be received from a purchasing agent or selling agent, and if such
payment is not received by the Indenture Trustee on the date that the Indenture
Trustee pays the Trust, the Trust shall forthwith repay the advance (unless
prior to such repayment the payment is received from such purchasing agent or
selling agent) and shall pay interest on such amount which shall accrue (after
as well as before judgment) on the basis of a year of 360 days (365 days (366
days in the case of a leap year) in the case of an advance paid in Sterling)
and the actual number of days elapsed from the date of payment of such advance
until the earlier of (i) repayment of the advance or (ii) receipt by the
Indenture Trustee of the payment from such purchasing agent or selling agent,
and at the rate per annum which is the aggregate of one per cent per annum and
the rate determined and certified by the Indenture Trustee and expressed as a
rate per annum as reflecting its cost of funds for the time being in relation
to the unpaid amount.

 

(f)                                    The
Notes shall be executed on behalf of the Trust by a Responsible Officer of
Wilmington.  The signature of any of
these officers on the Notes may be manual or facsimile.

 

24

 

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

 

Each Note
shall be dated the date of its authentication.

 

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

 

The Indenture
Trustee’s certificate of authentication shall be in substantially the following
form:

 

This is one of
the Notes of Protective Life Secured Trust [  ] referred to in the
within-mentioned Indenture.

 

 

	
   

  	
  THE BANK OF NEW YORK

  
	
   

  	
  As Indenture Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  

 

Notes bearing the manual signatures of individuals who were at any time
authorized officers of the Indenture Trustee shall bind the Trust,
notwithstanding that any such individuals have ceased to hold such offices
prior to the delivery of such Notes or did not hold such offices at the date of
such Notes.

 

In authenticating Notes hereunder, the Indenture Trustee shall be entitled
to conclusively assume that any Note authenticated by it has been duly executed
on behalf of, and is a legal, valid, binding and enforceable obligation of, the
Trust and is entitled to the benefits of this Indenture, and that the Trust
Agreement and the Funding Agreement have been duly executed by, and are the
legal, valid, binding and enforceable obligations of, the parties thereto.

 

(g)                                 The
Trust undertakes to notify the Paying Agent, the Registrar and, if different,
the Indenture Trustee, in writing, of any changes in the identity of the
purchasing agents and selling agents appointed generally in respect of the
Program.

 

SECTION 2.06. 
Registration.  All Notes shall be registered and
may be represented either as Global Notes or Definitive Notes.  Unless otherwise specified in the relevant
Pricing Supplement, Global Notes will be registered in the name of a nominee
for, and deposited with, a custodian for DTC. 
The Registrar shall maintain a register (herein sometimes referred to as
the “Register”)  in which, subject to such reasonable
regulations as it may prescribe, the Registrar

 

25

 

shall provide for the
registration of the Notes and registration of transfer of the Notes.  The Register shall be in written form in
English or in any other form capable of being converted into such form within a
reasonable time.  The Indenture Trustee
is hereby initially appointed as the Registrar.  In the event that the Indenture Trustee shall not be the
Registrar, it shall have the right to examine the Register at all reasonable
times.  The Trust, the Indenture
Trustee, Registrar, Paying Agent or any other Agent or Protective Life may
become the owner or pledgee of Notes and may deal with such Notes with the same
rights of any other Holder of such Notes.

 

SECTION 2.07. 
Transfer.

 

(a)                                  Subject
to Section 2.01(c) and (d), (A) upon surrender for registration of
transfer of any Note in accordance with its terms, Wilmington, on behalf of the
Trust shall execute, and the Indenture Trustee shall authenticate and deliver,
in the name of the designated transferee or transferees, one or more new Notes
denominated as authorized in or pursuant to this Indenture, of a like aggregate
principal amount bearing a number not contemporaneously outstanding and
containing identical terms and provisions and (B) at the option of the Holder,
Notes may be exchanged, in accordance with their terms, for other Notes
containing identical terms and provisions, in any authorized denominations, and
of a like aggregate principal amount, upon surrender of the Notes to be
exchanged at the Office or Agency of the Indenture Trustee.  Whenever any Notes are surrendered for
exchange as contemplated by this Section 2.07(a), the Trust shall
execute, and the Indenture Trustee shall authenticate and deliver, the Notes
which the Holder making the exchange is entitled to receive.  Beneficial interests in Global Notes may be
transferred or exchanged only through the Depositary.  No Global Note may be transferred except as a whole by a nominee
of the Depositary to the Depositary or to another nominee of the Depositary, or
by the Depositary or another nominee of the Depositary to a successor of the
Depositary or a nominee of a successor to the Depositary.  With respect to any Global Note, the
Depositary or its nominee is the Holder of such Global Note for the purposes of
this Indenture.  Except as set forth in Section
2.01(c), the beneficial owners of any Global Note will not be entitled to
receive Definitive Notes and shall not be considered “Holders” under this
Indenture.

 

(b)                                 All
Notes issued upon a registration of transfer or exchange of Notes shall be the
valid obligations of the Trust evidencing the same debt and entitling the
Holders thereof to the same benefits under this Indenture as the Notes
surrendered upon such registration of transfer or exchange.

 

(c)                                  No
service charge shall be made for any registration of transfer or exchange, of
Notes, but the Indenture Trustee  may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Notes.

 

SECTION 2.08. 
Mutilated, Destroyed, Lost and Stolen
Notes.

 

(a)                                  If
(i) any mutilated Note is surrendered to the Indenture Trustee directly or
through any Paying Agent or (ii) in the case of an alleged destroyed, lost or
stolen Note, the Indenture Trustee receives evidence to its satisfaction of the
destruction, loss or theft of the Note and there is delivered to the Indenture
Trustee, the Registrar and the Trust such security or indemnity as may be
required by the Indenture Trustee, the Registrar and the Trust to save the

 

26

 

Indenture Trustee, the
Registrar and the Trust harmless, then in either case the Trust shall execute
and the Indenture Trustee shall authenticate and deliver, in exchange for or in
lieu of such mutilated, destroyed, lost or stolen Note, a new Note, of the same
maturity, tenor and principal amount as such mutilated, destroyed, lost or
stolen Note, bearing a number not contemporaneously outstanding; provided, however, that if any such
mutilated, destroyed, lost or stolen Note shall have become or shall be about
to become due and payable, instead of issuing a new Note, the Trust may pay
such Note without surrender of such Note, except that any mutilated Note shall
be surrendered.

 

(b)                                 Upon
the issuance of any new Note, under this Section 2.08, the Indenture
Trustee or the Trust 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 reasonable expenses (including the fees and expenses of the Indenture
Trustee, Registrar or any Paying Agent) connected therewith.

 

(c)                                  Every
new Note issued pursuant to this Section 2.08 in lieu of any destroyed,
lost or stolen Note shall constitute a separate obligation of the Trust,
whether or not the destroyed, lost or stolen Note shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Notes duly issued
hereunder. The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Notes.

 

SECTION 2.09. 
Payment of Interest; Rights To
Interest Preserved.

 

(a)                                  The
Notes shall bear interest at a rate and on terms stated on the Notes.

 

(b)                                 Any
interest on any Note which is payable, and is punctually paid or duly provided
for, on any Interest Payment Date, shall be paid to the Person in whose name
that Note is registered at the close of business on the Regular Record Date for
such interest payment.

 

(c)                                  Any
interest on any Note which is payable, but is not punctually paid or duly
provided for, on any Interest Payment Date (herein called “Defaulted Interest”)  shall forthwith cease to be payable to the
Holder on the relevant Regular Record Date by virtue of their having been such
Holder, and such Defaulted Interest shall be paid by the Trust to the Persons
in whose names such Notes (or their respective predecessor Notes) are
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest, which shall be fixed in the following manner.  The Trust shall notify the Indenture Trustee
within fifteen (15) days of the date interest became due and payable in writing
of the amount of Defaulted Interest to be paid on each Note, which shall be
equal to the amount of Defaulted Interest due on such Note and not any lesser
amount, and the date of such payment (such date to be no more than forty-five
(45) days following the date interest became due and payable).  Thereupon the Indenture Trustee shall fix a
record date for the payment of such Defaulted Interest which shall be not more
than fifteen (15) days and not less than ten (10) days prior to the date of
such payment and not less than ten (10) days after the receipt by the Indenture
Trustee of the notice of  such payment
(the “Special Record Date”).  The Indenture Trustee shall promptly notify
the Trust of such Special Record Date and, in the name of the Trust shall cause
notice of

 

27

 

the payment of such Defaulted
Interest and the Special Record Date therefor to be given to each Holder in
accordance with Section 1.06. 
The Trust may make payment of any Defaulted Interest on the Notes in any
other lawful manner not inconsistent with the requirements of any securities
exchange, if any, on which such Notes may be listed, and upon such notice as
may be required by such exchange, if, after notice given by the Trust to the
Indenture Trustee of the payment pursuant to this clause, such manner of
payment shall be deemed practicable by the Indenture Trustee.  Subject to the foregoing provisions of this
Section, each Note delivered under this Indenture upon registration of transfer
of or in exchange for or in lieu of any other Note shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Note.

 

SECTION 2.10. 
Cancellation.  All Notes surrendered for payment,
registration of transfer or exchange shall, if surrendered to any Person other
than the Indenture Trustee, be delivered to the Indenture Trustee and shall be
promptly cancelled by it.  Protective
Life may at any time deliver to the Indenture Trustee for cancellation any Note
previously authenticated and delivered hereunder that Protective Life, may have
acquired in any manner whatsoever, and all Notes so delivered shall be promptly
cancelled by the Indenture Trustee.  No
Notes shall be authenticated in lieu of or in exchange for any Notes cancelled
as provided in this Section, except as expressly permitted by this Indenture.
All cancelled Notes held by the Indenture Trustee shall be disposed of by the
Indenture Trustee in accordance with its customary procedures, unless the Trust
shall otherwise direct by a Trust Order.

 

SECTION 2.11. 
Persons Deemed Owners.  Prior to due presentment for
registration of transfer of any Note, the Trust, the Indenture Trustee, the
Registrar, the Paying Agent, any Agent, and any other agent of the Trust, or
the Indenture Trustee may treat the Person in whose name any Note is registered
as the absolute and sole owner of such Note for the purpose of receiving
payment of the principal of, any premium, or interest on or any Additional
Amounts with respect to such Note and for all other purposes whatsoever,
whether or not such Note shall be overdue, and, except as otherwise required by
applicable law, none of the Trust, the Indenture Trustee, the Registrar, the
Paying Agent, any Agent, or any other agent of the Trust or the Indenture
Trustee shall be affected by notice to the contrary.

 

SECTION 2.12. 
Tax Treatment; Tax Returns and
Reports.

 

(a)                                  The
Trust and the Trust Beneficial Owner agree, and by acceptance of a beneficial
interest in a Note each holder of a beneficial interest in a Note agrees, for
U.S. federal, state and local income and franchise tax purposes, to treat (i)
the Trust as a separate grantor trust, (ii) such Note as an ownership interest
in such grantor trust and (iii) the Funding Agreement as debt of Protective
Life.

 

(b)                                 Wilmington
shall, or, so long as there is an Administrator, the Administrator shall,
pursuant to the Administrative Services Agreement, prepare and file or cause to
be prepared or filed, consistent with the treatment of the Trust as a grantor
trust, all federal, state and local income tax and information returns and
reports required to be filed with respect to the Trust, and the Notes under any
applicable federal, state or local tax statute or any rule or regulation under
any of them.  At the request of the
Administrator, Wilmington shall sign and, in accordance with instructions
provided by the Administrator, file any federal, state or local

 

28

 

income tax and information
returns and reports prepared by, or at the direction of, the Administrator
pursuant to this Section 2.12(b). 
Wilmington shall keep copies or cause copies to be kept of any such tax
and information returns (including Internal Revenue Service (“IRS”) Form 1041)
and reports prepared and filed and provided to it by the Administrator.

 

SECTION 2.13. 
No Partners.  Nothing set forth in this
Indenture shall be construed to constitute the Holders of Notes, from time to
time, as partners or members of an association.

 

ARTICLE 3

Covenants, Representations and Warranties

 

SECTION 3.01. 
Payment of Principal and any Premium,
Interest and Additional Amounts. 
The Trust covenants and agrees, for the benefit of the Holders of Notes,
that it will:

 

(a)                                  Pay
or cause to be paid to the Paying Agent on or before the date on which any
payment becomes due, an amount equal to the amount of principal (and premium,
if any) and interest and any additional amount payable in respect of the Notes
then becoming due in respect of such Notes.

 

(b)                                 Pay
each amount payable to the Paying Agent under Section 3.01(a) by
transfer of immediately available funds denominated in the Specified Currency
not later than 10:00 a.m. (at the Place of Payment) on the date when such
amounts are due and payable in respect of the Notes.

 

(c)                                  Confirm,
before 10:00 a.m. (at the Place of Payment) on the second Business Day before
the due date of each payment by it under Section 3.01(a) to the Paying
Agent by confirmed facsimile, that irrevocable instructions have been given by
it, for the transfer of the relevant funds to the Paying Agent and the name and
the account of the bank through which such payment is being made.

 

An installment of principal,
premium, if any, or interest and any other amount payable in respect of the
Notes shall be considered paid on the date it is due if the Trust has
deposited, or caused to be deposited, with the Paying Agent by such date money
designated for, and capable of being applied towards, and sufficient to pay the
installment.

 

SECTION 3.02. 
Collection Account.  The Indenture Trustee shall, on
or prior to each Issuance Date, establish an account with the Indenture Trustee
or such other depository institution that is rated at least AA- or Aa3 by a
nationally recognized statistical rating organization as may be designated by
Wilmington or the Administrator, in the name of the Notes, which account shall
be segregated from other accounts held by the Indenture Trustee or such other
depositary institution.

 

SECTION 3.03. 
Agreements of the Paying Agent.  The Paying Agent agrees that:

 

(a)                                  The
Paying Agent shall be entitled to deal with each amount paid to it hereunder in
the same manner as other amounts paid to it as a banker by its customers
provided that:

 

29

 

(i)                                     the
Paying Agent shall not, against the Trust or any Holder of a Note, exercise any
lien, right of set-off or similar claim in respect thereof (except as otherwise
provided or permitted under this Indenture);

 

(ii)                                  the
Paying Agent shall not be liable to any person for interest thereon;

 

(iii)                               the
Paying Agent need not segregate any money held by it except as required by law
or as otherwise provided under this Indenture; and

 

(iv)                              the
Paying Agent shall comply with the provisions of Sections 317(b) of the Trust
Indenture Act and agrees that it will, during the continuance of any default by
the Trust (or any other obligor upon the Notes) in the making of any payment in
respect of the Notes, upon the written request of the Indenture Trustee,
forthwith pay to the Indenture Trustee all sums held in trust by such Paying
Agent for payment in respect of the Notes.

 

(b)                                 The
Paying Agent shall pay or cause to be paid by transfer of immediately available
funds denominated in the Specified Currency to the Holders all moneys received
by the Paying Agent for such purpose from the Trust pursuant to Section 3.01.  In the event a Note is issued between a
Regular Record Date or Special Record Date and the related Interest Payment
Date, interest for the period beginning on the original issue date for such
Note or the previous Interest Payment Date, as the case may be, and ending on
the subject Interest Payment Date will be paid on the immediately following
Interest Payment Date to the Person who was the registered Holder of such Note
as of the immediately preceding Regular Record Date.  With respect to Global Notes, the Paying Agent shall pay
principal, premium, if any, interest and any other amounts due on such Global
Notes in accordance with the arrangements established by and between the
Indenture Trustee and the Depositary. 
Notwithstanding anything herein to the contrary, payments of principal
in respect of Definitive Notes shall be made as provided in or pursuant to this
Indenture against presentation and surrender of the relevant Definitive Notes
at the designated office of the Registrar in The City of New York, as provided
herein or in the applicable Definitive Note. 
Notwithstanding anything herein to the contrary, interest on Definitive
Notes shall be paid to the person shown in the applicable Register at the close
of business on the Regular Record Date or Special Record Date, as applicable,
as provided in or pursuant to this Indenture before the due date for payment
thereof.  Notwithstanding anything
herein to the contrary, payments of interest on each Definitive Note shall be
made in the currency in which such payments are due by check drawn on a bank in
the Principal Financial Center of the country of the Specified Currency and
mailed to the holder (or to the first named of joint holders) of such
Definitive Note at its address appearing in the  applicable Register.  Upon
application by a Holder of at least $250,000 in aggregate principal amount of
Notes (or its equivalent in the Specified Currency other than U.S. Dollars) to
the specified office of the Paying Agent at least five (5) Business Days before
the Regular Record Date or Special Record Date, as applicable, such payment of
interest may be made by transfer to an account in the Specified Currency
maintained by the payee with a bank in the Principal Financial Center or, in
the case of Definitive Notes denominated in euro, in a city in which banks have
access to the TARGET System.  All  moneys paid to the Paying Agent by the Trust
in respect of any Note shall be held by the Paying Agent from the moment when
such moneys are received until the

 

30

 

time of actual payment thereof,
for the persons entitled thereto, and shall be applied in accordance with Section
3.03 (c) through (h); provided, that the obligation of the Paying Agent to
hold such moneys shall be subject to the provisions of Section 3.08.

 

(c)                                  The
Paying Agent acting through its specified office shall make payments of
interest and Additional Amounts (if applicable) or, as the case may be,
principal in respect of the Notes in accordance with the  terms thereof and of this Indenture,
provided that such Paying Agent shall not be obliged (but shall be entitled) to
make such payments if it is not able to establish that it has received (whether
or not at the due time) the full amount of the relevant payment due to it under
Section 3.01(a).  Payment of any
Note redemption amount (together with accrued interest) due in respect of Notes
will be made against presentation and surrender of the relevant Notes at the
specified office of the Paying Agent, subject to Section 2.04(h).  Payment of amounts (whether principal,
interest or otherwise) due in respect of Notes will be paid by the Paying Agent
to the Holder thereof (or, in the case of joint Holders, the first named) which
shall be the person appearing as Holder in the register kept by the Registrar
as at the close of business (local time in the place of the specified office of
the Registrar) on the Regular Record Date.

 

(d)                                 The
Paying Agent shall not exercise any lien, right of set-off or similar claim against
any person to whom it makes any payment under paragraph (c) in respect thereof,
nor shall any commission or expense be charged by it to any such person in
respect thereof.

 

(e)                                  If
a Paying Agent makes any payment in accordance with paragraph (c), it shall be
entitled to appropriate for its own account out of the funds received by it
under Section  3.01(a) an amount
equal to the amount so paid by it.

 

(f)                                    If
a Paying Agent makes a payment in respect of Notes at a time at which it has
not received the full amount of the relevant payment due to it under Section
3.01(a) and is not able to reimburse itself out of funds received by it
under Section 3.01(a) therefor by appropriation under paragraph (e) the
Trust shall from time to time on demand pay to the Paying Agent for its own
account:

 

(i)                                     the
amount so paid out by such Paying Agent and not so reimbursed to it; and

 

(ii)                                  interest
on such amount from the date on which such Paying Agent made such payment until
the date of reimbursement of such amount;

 

provided that any
payment made under paragraph (i) above shall satisfy pro tanto the Trust’s obligations under Section 3.01(a).

 

(g)                                 Interest
shall accrue for the purpose of paragraph (2) of paragraph (f) (as well after
as before judgment) on the basis of a year of 360 days (365 days (366 days in
the case of a leap year) in the case of an amount in Sterling) and the actual
number of days elapsed and at the rate per annum which is the aggregate of one
percent per annum and the rate per annum specified by the Paying Agent as
reflecting its cost of funds for the time being in relation to the unpaid
amount.

 

31

 

(h)                                 If
at any time and for any reason a Paying Agent makes a partial payment in
respect of any Note surrendered for payment to it, such Paying Agent shall
endorse thereon and in the register a statement indicating the amount and date
of such payment.

 

SECTION 3.04. 
Maintenance of Office or Agency.

 

(a)                                  The
Trust will maintain in the Place of Payment an Office or Agency where Notes may
be presented or surrendered for payment, where Notes may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Trust in respect of the Notes and this Indenture may be served; provided, however, that if the Notes are
listed on any stock exchange and the rules of such stock exchange shall so
require, the Trust shall maintain an Office or Agency in any other required
city so long as the Notes are listed on such exchange.  The Trust will give prompt written notice to
the Indenture Trustee of the location, and any change in the location, of such
Office or Agency.  If at any time the
Trust shall fail to maintain any such required Office or Agency or shall fail
to furnish the Indenture Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Indenture Trustee and the Trust hereby appoints the Indenture
Trustee as its agent to receive such respective presentations, surrenders,
notices and demands.  The Trust shall
promptly notify the Indenture Trustee of the name and address of each Paying
Agent appointed by it and will notify the Indenture Trustee of the resignation
or termination of any Paying Agent.

 

(b)                                 The
Trust may also from time to time designate one or more other Offices or
Agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided, however, that no such designation
or rescission shall in any manner relieve the Trust of its obligation to
maintain the Offices or Agencies for Notes in the Place of Payment for the
foregoing purposes. The Trust shall give prompt written notice to the Indenture
Trustee of any such designation or rescission and of any change in the location
of any such Office or Agency.

 

(c)                                  Unless
otherwise provided in or pursuant to this Indenture, the Trust hereby appoints
the Indenture Trustee as Paying Agent, Registrar and Transfer Agent.

 

SECTION 3.05. 
Duties of the Agents.

 

(a)                                  The
Trust shall provide to the Paying Agent sufficient copies of all documents
required to be available for inspection as provided in the Registration
Statement or the Pricing Supplement in respect of the Notes.

 

(b)                                 To
the extent permitted by applicable law, the Paying Agent shall make available
for inspection during normal business hours at its specified office such
documents as may be specified as so available at the specified office of the
Paying Agent in respect of the Notes, or as may be required by any stock
exchange on which the Notes may be listed.

 

(c)                                  Notwithstanding
anything to the contrary, the Trust shall be solely responsible for ensuring
that each Note to be issued or other transactions to be effected hereunder shall
comply with all applicable laws and regulations of any governmental or other
regulatory authority in connection with any Note and that all necessary
consents and approvals

 

32

 

of, notifications to and
registrations and filings with, any such authority in connection therewith are
effected, obtained and maintained in full force and effect.

 

(d)                                 The
Paying Agent shall collect all forms from Holders or, in the case of Notes held
in a Clearing System, from the relevant Clearing System, that are required to
exempt payments under the Notes and/or the related Funding Agreements, from
United States federal income tax withholding. 
The Paying Agent shall (i) withhold from each payment hereunder or under
any Note any and all United States federal or state withholding taxes
applicable thereto as required by law and (ii) file any information reports as
it may be required to file under applicable law.

 

(e)                                  Each
Agent shall be obligated to perform such duties and only such duties as are set
out in this Indenture and no implied duties or obligations shall be read into
this Indenture against such Agent.

 

(f)                                    Each
Agent shall be protected and shall incur no liability for or in respect of any
action taken, omitted or suffered in reliance upon any instruction, request or
order from the Trust or any notice, resolution, direction, consent,
certificate, affidavit, statement, facsimile, telex or other paper or document
(duly signed or which it believes in good faith to have been duly signed, where
applicable) which it believes in good faith to be genuine and to have been
delivered, signed or sent by the proper party or parties.

 

(g)                                 Each
Agent and any of its officers, directors, employees or controlling persons may
become the owner of, or acquire any interest in any Note, with the same rights
that it or he would have if it or he were not appointed under this Indenture,
and may engage or be interested in, any financial or other transaction with the
Trust or Protective Life, or may act as depositary, trustee or agent for any
committee or body of Holders, as freely as if it or he were not appointed under
this Indenture.

 

(h)                                 Each
Agent may consult with legal and other professional advisers and the opinion of
the advisers shall be full and complete protection in respect of action
taken, omitted or suffered under this Indenture in good faith and in accordance
with the opinion of the advisers.

 

(i)                                     Under
no circumstances will the Paying Agent or any other Agent be liable to the
Trust, or any other party to this Indenture for any consequential loss (being
loss of business, goodwill, opportunity or profit), punitive damages or
indirect loss even if advised of the possibility of such loss.

 

SECTION 3.06. 
Duties of the Transfer Agent.  If and to the extent specified in
the terms and conditions of the Notes or if otherwise requested by the Trust or
Indenture Trustee, the Transfer Agent shall in compliance with the Notes and
this Indenture:

 

(a)                                  Receive
requests from Holders of Notes for the transfer of Definitive Notes, inform the
Registrar in writing of the receipt of such requests, forward the deposited
Definitive Note(s) to or to the order of the Registrar and assist in the
issuance of a new Definitive Note and in particular, without limitation, notify
the Registrar in writing of (i) the name and address of the Holder of the
Definitive Note, (ii) the serial number and principal amount of the Definitive
Note, (iii) in the case of a transfer of a portion of the Note only, the
principal amount 

 

33

 

of the Definitive Note to be so
transferred and (iv) the name and address of the transferee to be entered on
the Register;

 

(b)                                 Make
available for collection by each relevant Holder new Definitive Notes;

 

(c)                                  Accept
surrender of Definitive Notes and assist in effecting final payment of the
Notes on the due date for payment;

 

(d)                                 Keep
the Registrar informed of all transfers; and

 

(e)                                  Carry
out such other acts as may reasonably be necessary to give effect to the Notes
and this Indenture.

 

SECTION 3.07. 
Duties of the Registrar.

 

(a)                                  The
Registrar shall maintain a Register which shall show the aggregate principal
amount and date of issue of each Series of Notes, the names and addresses of
the initial Holders thereof and the dates of all transfers to, and the names
and addresses of, all subsequent Holders thereof.

 

(b)                                 The
Registrar shall by the issue of new Notes, the cancellation of old Notes and
the making of entries in the Register give effect to transfers of Notes in
accordance with this Indenture.

 

(c)                                  The
Trust may from time to time deliver to the Registrar Notes of which it is the
Holder for cancellation, whereupon the Registrar shall cancel the same and
shall make the corresponding entries in the Register.

 

(d)                                 As
soon as reasonably practicable but in any event within ninety (90) days after
each date on which Notes fall due for redemption, the Registrar shall notify
the Trust of the serial numbers of any Notes against surrender of which payment
has been made and of the serial numbers of any Notes (and the names and
addresses of the Holders thereof) which have not yet been surrendered for
payment.

 

(e)                                  The
Registrar shall, upon and in accordance with the instructions of the Trust but
not otherwise, arrange for the delivery in accordance with this Indenture of
any notice which is to be given to the Holders of Notes and shall supply a copy
thereof to the Indenture Trustee and the Paying Agent.

 

(f)                                    The
Trust shall ensure that each Registrar has available to it supplies of such
Notes as shall be necessary in connection with the transfer of Notes and the
exchange of Global Notes for Definitive Notes.

 

(g)                                 The
Registrar shall make available, at the request of the Holder of any Note, forms
of proxy in a form and manner which comply with the provisions of this
Indenture and shall perform and comply with the provisions of this Indenture.

 

34

 

(h)                                 The
Trust shall provide to the Registrar:

 

(i)                                     specimen
Notes in definitive form; and

 

(ii)                                  sufficient
copies of all documents required to be available for inspection as provided in
the Registration Statement or the Pricing Supplement in respect of the Notes,
as may be required by any securities exchange on which the Notes may be listed,
or as may be required by applicable law.

 

(i)                                     The
Registrar shall make available for inspection during normal business hours at
its specified office such documents as may be specified as so available at the
specified office of such Registrar, as may be required by any securities
exchange on which the Notes may be listed, or as may be required by applicable
law.

 

(j)                                     The
Registrar shall provide the Paying Agent and/or Indenture Trustee with all such
information in the Registrar’s possession with respect to the Notes as the
Paying Agent or the Indenture Trustee, as the case may be, may reasonably
require in order to perform the obligations set out in this Indenture.

 

(k)                                  The
Registrar shall ensure that in no event shall Definitive Notes be exchanged for
Global Notes.

 

SECTION 3.08. 
Unclaimed Monies.  Any money deposited with the Indenture
Trustee, Registrar or the Paying Agent for the payment of the principal of,
premium, if any, or interest on any Note and remaining unclaimed for two years
after such principal or any such premium or interest had become due and payable
shall, unless otherwise required by mandatory provisions of applicable escheat
or abandoned or unclaimed property law, be paid to Protective Life pursuant to
a Trust Request and pursuant to the applicable Funding Agreement; and the
Holder of such Note shall thereafter, as an unsecured general creditor, look
only to Protective Life for payment thereof, and all liability of the Indenture
Trustee, Registrar or the Paying Agent with respect to such trust money shall
thereupon cease; provided, however, that
the Indenture Trustee, Registrar or the Paying Agent, before being required to
make any such repayment, may cause to be published once, in an Authorized
Newspaper in each Place of Payment or to be mailed to Holders, or both, notice
that such money remains unclaimed and that, after a date specified therein,
which shall not be less than thirty (30) days from the date of such publication
or mailing, any unclaimed balance of such money then remaining will be repaid
to Protective Life.

 

SECTION 3.09.  Protection
of Collateral.

 

(a)                                  The
Trust shall, from time to time, execute and deliver all such supplements and
amendments hereto and all such financing statements, continuation statements,
instruments of further assurance, and other instruments, and take such other
action as may be necessary or advisable to:

 

(i)                                     create,
perfect or maintain a perfected security interest in, grant, or make or
maintain a valid and effective assignment for collateral purposes

 

35

 

of, all or any
portion of the Collateral (including without limitation the Funding Agreement
included therein);

 

(ii)                                  maintain
or preserve any Lien of this Indenture or the Funding Agreement or carry out
more effectively the purposes hereof or thereof;

 

(iii)                               perfect,
publish notice of, or protect the validity of, any security interest or
assignment for collateral purposes made pursuant to this Indenture or the
Funding Agreement;

 

(iv)                              enforce
any portion, or obtain the full benefits, of the Collateral (including without
limitation the Funding Agreement included therein); and

 

(v)                                 preserve
and defend title to the Collateral and the rights of the Indenture Trustee and
of the Holders in the Collateral held for the benefit and security of the
Holders or other instrument against the claims of all Persons.

 

The Trust
hereby designates the Indenture Trustee its agent and attorney-in-fact to
execute any financing statement, continuation statement or other instrument
required or permitted pursuant to this Section 3.09; provided, however, that such designation
shall not be deemed to create a duty in the Indenture Trustee to monitor the
compliance of the Trust with the foregoing covenants; provided further, however, that the duty
of the Indenture Trustee to execute any instrument required pursuant to this Section
3.09 shall arise only if any Responsible Officer of the Indenture Trustee
has actual knowledge of any failure of the Trust to comply with the provisions
of this Section 3.09.

 

(b)                                 The
Trust will pay or cause to be paid all taxes and fees incidental to such
filing, registration and recording, and all expenses incidental to the
preparation, execution and acknowledgment of any instrument of further assurance,
and all Federal or state or jurisdiction of organization of the Trust stamp
taxes or other similar taxes, duties and charges arising out of or in
connection with the execution and delivery of such instruments; provided, however, that the Trust shall not
be required to pay or discharge or cause to be paid or discharged any Lien
affecting the Collateral to the extent such Lien is being contested in good
faith by appropriate proceedings.  The
Trust will at all times preserve, warrant and defend the Indenture Trustee’s
title and right in and to the property included in the Collateral against the
claims of all Persons.

 

(c)                                  The
Trust will faithfully observe and perform, or cause to be observed and
performed, all its covenants, agreements, conditions and requirements contained
in the Funding Agreement in accordance with the terms thereof and will maintain
the validity and effectiveness of the Funding Agreement and the security
interest therein or the assignment for collateral purposes thereof to the
Indenture Trustee.  The Trust will take
no action, nor permit any action to be taken, which will release any party to
the Funding Agreement from any of its obligations or liabilities thereunder, or
will result in the termination, modification or amendment, or will impair the
validity, of the Funding Agreement except as expressly provided for herein and
therein.  The Trust will give the
Indenture Trustee written notice of any default by any party to the Funding
Agreement promptly after it becomes known to the Trust.

 

36

 

(d)                                 At
the written request of the Indenture Trustee and also following the occurrence
of an “Event of Default” under the Funding Agreement, the Trust will, subject
to the written direction and control of the Indenture Trustee, take such
action, or at the Indenture Trustee’s written request furnish funds sufficient
to enable the Indenture Trustee to take such action, as the Indenture Trustee
may deem necessary or advisable for enforcing payment when due, subject to
applicable notice and grace periods, under or pursuant to this Indenture or the
Funding Agreement.

 

SECTION 3.10. 
Opinions as to Collateral; Annual
Statement as to Compliance.

 

(a)                                  On
or before the seventh day of November of each calendar year, commencing
November 7, 2003, Protective Life or the Trust shall furnish or cause to be
furnished to the Indenture Trustee an Opinion of Counsel stating that, in the
opinion of such counsel, either (i) such action has been taken with respect to
the recording, filing, re-recording and re-filing of this Indenture, any
indentures supplemental hereto and any other requisite documents and with
respect to the execution and filing of any financing statements and
continuation statements as is necessary to perfect and/or maintain the
perfection of liens, security interests and assignments for collateral purposes
created or effected pursuant to this Indenture with respect to each Funding
Agreement that is part of any Collateral and reciting the details of such
action or (ii) in the opinion of such counsel no such action is necessary to
perfect and/or maintain the perfection of such lien, security interest and
assignment for collateral purposes.

 

(b)                                 On
or before the seventh day of November in each calendar year, commencing
November 7, 2003, the Trust shall deliver to the Indenture Trustee a Trust
Certificate stating, as to each signer thereof, that in the course of the
performance by each signer of such Trust Certificate of his or her present
duties as a Responsible Officer of Wilmington, such signer would normally
obtain knowledge or have made due inquiry as to the existence of any condition
or event which would constitute a Default or Event of Default and that to the
best of such signer’s knowledge, based on such review:

 

(i)                                     a
review of the fulfillment by the Trust and during such year of its obligations
under this Indenture has been made under the supervision of such signer; and

 

(ii)                                  the
Trust has fulfilled in  all
material respects its obligations under this Indenture throughout such year,
or, if there has been a Default or Event of Default in the fulfillment of any
such obligation, specifying each such Default or Event of Default known to such
signer and the nature and status thereof.

 

(c)                                  The
Trust, pursuant to Section 314(a) of the Trust Indenture Act, shall:

 

(i)                                     file
with the Indenture Trustee, within fifteen (15) days after the Trust is
required to file the same with the Commission, copies of the annual reports and
of the information, documents and other reports (or copies of such portions of
any of the foregoing as the Commission may from time to time by rules and
regulations prescribe) which the Trust may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Securities

 

37

 

Exchange Act;
or, if the Trust is not required to file information, documents or reports
pursuant to either of said Sections, then it shall file with the Indenture
Trustee and the Commission, in accordance with rules and regulations prescribed
from time to time by the Commission, such of the supplementary and periodic
information, documents and reports which may be required pursuant to Section 13
of the Securities Exchange Act in respect of a security listed and registered
on a national securities exchange as may be prescribed from time to time in
such rules and regulations; provided that if, pursuant to any publicly
available interpretations of the Commission, the Trust would not be required to
make such filings under Section 314(a) of the Trust Indenture Act, then the
Trust shall not be required to make such filings.

 

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

 

(iii)                               transmit
within thirty (30) days after the filing thereof with the Indenture Trustee, in
the manner and to the extent provided in Section 313(c) of the Trust Indenture
Act, such summaries of any information, documents and reports required to be
filed by the Trust pursuant to paragraphs (i) and (ii) of this Section
3.10(c) as may be required by rules and regulations prescribed from time to
time by the Commission.

 

(d)                                 The
Trust shall comply with the provisions of Section 314(d) of the Trust Indenture
Act.

 

SECTION 3.11. 
Performance of Obligations.  The Trust may contract with other Persons
for the performance of the Trust’s obligations hereunder (other than the
execution and delivery of Trust Requests, Trust Orders and Trust Certificates)
and the performance of such obligations by such other Persons shall be deemed
to be the performance thereof by the Trust, as applicable.

 

SECTION 3.12. 
Existence.

 

(a)                                  The
Trust will do or cause to be done all things necessary to preserve and keep in
full force and effect its existence, rights (charter and statutory) and
franchises as a Delaware statutory or common law trust, as applicable, and,
upon the advice of counsel, will obtain and preserve its qualification to do
business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Indenture, the
Notes or any portion of the Collateral. 
The Trust will, promptly after any amendment or modification of the
Trust Agreement, send copies thereof to the Indenture Trustee and the Rating
Agencies.

 

(b)                                 The
Trust will maintain books and records and bank accounts separate from those of
any other Person and any other trust organized under the Program; will at all
times 

 

38

 

hold itself out to the public as
separate and distinct from any Affiliates and each other trust organized under
the Program; and file or cause to be filed its own tax returns.

 

(c)                                  The
Trust shall maintain its assets and transactions separately from those of any
Affiliates and any other trust organized under the Program, reflect such assets
and transactions in financial statements separate and distinct from those of
any Affiliates and any trust organized under the Program and evidence such
assets and transactions by appropriate entries in books and records separate
and distinct from those of any Affiliates (including any other trust organized
under the Program).

 

SECTION 3.13. 
Reports; Financial Information;
Notices of Defaults.

 

(a)                                  The
Trust shall promptly deliver to the Indenture Trustee copies of all reports,
statements and information received by it pursuant to the Funding Agreement or
otherwise in respect of the Collateral.

 

(b)                                 The
Trust shall promptly inform the Indenture Trustee in writing of the occurrence
of any Default or Event of Default which is continuing of which it has actual
knowledge.  Each notice given pursuant
to this Section 3.13(b) shall be accompanied by a Trust Certificate
setting forth details of the occurrence referred to therein and stating what
action, if any, the Trust has taken or proposes to take with respect thereto.

 

(c)                                  The
Trust shall collect all forms (or, if applicable, copies of such forms), if
any, from the Paying Agent or Registrar (or from such other persons as are
relevant) that are required to exempt payments under the Notes or the Funding
Agreement, from United States federal income tax withholding.  In addition, the Trust shall execute and
file such forms and take such actions for United States federal income tax
purposes as shall be reasonable and necessary to ensure that payments of
interest, principal, premium and Additional Amounts, if applicable, in respect
of the Notes or the Funding Agreement, are not subject to United States federal
withholding or backup withholding tax.

 

(d)                                 In
accordance with Section 312(a) of the Trust Indenture Act, the Trust shall
furnish or cause to be furnished to the Indenture Trustee:

 

(i)                                     semi-annually
with respect to the Series of Notes not later than the seventh day of May and
the seventh day of November of each year or upon such other dates as are set
forth in or pursuant to a Trust Order or indenture supplemental hereto a list,
in each case in such form as the Indenture Trustee may reasonably require, of
the names and addresses of Holders as of the applicable date, and

 

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

 

provided, however, that so long as the
Indenture Trustee is the Registrar no such list shall be required to be
furnished.

 

39

 

(e)                                  The
Indenture Trustee shall comply with the obligations imposed upon it pursuant to
Section 312 of the Trust Indenture Act.

 

Every Holder,
by receiving and holding Notes, agrees with the Trust and the Indenture Trustee
that neither the Trust, the Indenture Trustee, the Paying Agent or the
Registrar shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders in accordance with
Section 312(c) of the Trust Indenture Act, regardless of the source from which
such information was derived, and that the Indenture Trustee shall not be held
accountable by reason of mailing any material pursuant to a request made under
Section 312(b) of the Trust Indenture Act.

 

(f)                                                                                    (i)                                     On
or before the seventh day of November of each calendar year commencing November
7, 2003, if required by Section 313(a) of the Trust Indenture Act, the
Indenture Trustee shall transmit, pursuant to Section 313(c) of the Trust
Indenture Act, a brief report with respect to any of the events specified in
Section 313(a) of the Trust Indenture Act which may have occurred since the
later of the immediately preceding seventh day of November and the date of this
Indenture.

 

(ii)                                  The
Indenture Trustee shall transmit, pursuant to Section 313(c) of the Trust
Indenture Act, the reports required by Section 313(b) of the Trust Indenture
Act at the time specified therein.

 

(iii)                               Reports
pursuant to this Section shall be transmitted in the manner and to the Persons
required by Sections 313(c) and 313(d) of the Trust Indenture Act.

 

SECTION 3.14. 
Payment of Taxes and Other Claims.  The Trust will pay or discharge or cause to
be paid or discharged, before the same shall become delinquent, (1) all taxes,
assessments and governmental charges levied or imposed upon the Trust or upon
the income, profits or property of the Trust, and (2) all lawful claims for
labor, materials and supplies which, if unpaid, might by law become a Lien upon
the property of the Trust; provided,
however, that the Trust shall not be required to pay or discharge or
cause to be paid or discharged any such tax, assessment, charge or claim whose
amount, applicability or validity is being contested in good faith by
appropriate proceedings.  The Trust
shall comply with the requirements of all other applicable laws, the
non-compliance with which would, individually or in the aggregate, materially
and adversely affect the condition (financial or otherwise) of the Trust or
which would impair in any material respect the ability of the Trust to perform
its obligations under the Notes or this Indenture.

 

SECTION 3.15. 
Negative Covenants.  So  long
as any Notes are Outstanding, the Trust will not take any of the following
actions, except as otherwise permitted hereunder:

 

(a)                                  sell,
transfer, exchange, assign, lease, convey or otherwise dispose of any assets
held by the Trust (owned as of the date of the Trust Agreement, or thereafter
acquired), including, without limitation, any portion of the Collateral, except
as expressly permitted hereby;

 

40

 

(b)                                 incur
or otherwise become liable, directly or indirectly, for any Indebtedness or
Contingent Obligation except for the Notes issued pursuant to this Indenture
and the transactions contemplated thereby;

 

(c)                                  engage
in any business or activity other than in connection with, or relating to, the
performance of the Trust Agreement and the execution, delivery and performance
of any documents, including the Program Documents (other than the Trust
Agreement), relating to the Notes issued under this Indenture and the transactions
contemplated thereby, and the issuance of the Notes pursuant to this Indenture;

 

(d)                                 (i)                                     permit
the validity or effectiveness of this Indenture or any grant of security
interest in or assignment for collateral purposes of the Collateral to be impaired,
or permit a Lien created under this Indenture to be amended, hypothecated,
subordinated, terminated or discharged, or permit any Person to be released
from any covenants or obligations under any document or agreement assigned to
the Indenture Trustee, except as may be expressly permitted hereby, (ii)
create, incur, assume or permit any Lien or other encumbrance (other than a
Lien created by this Indenture) on any of its properties or assets owned or
thereafter acquired, or any interest therein or the proceeds thereof, or (iii)
permit a Lien created under this Indenture not to constitute a valid first
priority perfected security interest in the Collateral;

 

(e)                                  amend,
modify or fail to comply with any material provision of the Trust Agreement,
except for any amendment or modification of the Trust Agreement expressly
permitted thereunder;

 

(f)                                    own
any subsidiary or lend or advance any funds to, or make any investment in, any
Person, except for an investment in Funding Agreements or the investment of any
funds held by the Indenture Trustee, the Paying Agent, Wilmington or the
Administrator as provided in this Indenture or the Trust Agreement;

 

(g)                                 directly
or indirectly declare or make any distribution or other payment to, or redeem
or otherwise acquire or retire for value the interest of, the Trust Beneficial
Owner if any amount under the Notes is due and unpaid, or directly or
indirectly redeem or otherwise acquire or retire for value any Indebtedness or
Contingent Obligation other than the Notes;

 

(h)                                 exercise
any rights with respect to the Collateral except at the written direction of,
or with the prior written approval of, the Indenture Trustee;

 

(i)                                     become
an “investment company” under, or come under the “control” of an “investment
company,” as such terms are defined in the Investment Company Act;

 

(j)                                     enter
into any transaction of merger or consolidation or liquidate or dissolve itself
(or suffer any liquidation or dissolution), or acquire by purchase or otherwise
all or substantially all the business or assets of, or any stock or other
evidence of beneficial ownership of, any Person;

 

(k)                                  take
any action that would cause it not to be treated as a grantor trust for United
States federal income tax purposes;

 

41

 

(l)                                     have
any subsidiaries, employees or agents other than Wilmington, the Administrator
and other persons necessary to conduct its activities and enter into
transactions contemplated under the Program Documents;

 

(m)                               have
an interest in any bank account other than (i) those accounts required under
the Program Documents, and (ii) those accounts expressly permitted by the
Indenture Trustee; provided that
any such further accounts or the Trust’s interest therein shall be charged or
otherwise secured in favor of the Indenture Trustee;

 

(n)                                 issue
Notes under this Indenture unless (i) the Trust has purchased or will
simultaneously purchase one or more Funding Agreements from Protective Life to
secure such Notes, (ii) Protective Life has affirmed in writing to the Trust
that it has made or simultaneously will make changes to its books and records
to reflect the granting of a security interest in, and the making of an
assignment for collateral purposes of, the Funding Agreements by the Trust to
the Indenture Trustee and (iii) the Trust has taken such other steps as may be
necessary to cause the Indenture Trustee’s grant of security interest in, and
assignment for collateral purposes of, the Collateral to be perfected for
purposes of the UCC or effective against the Trust’s creditors and subsequent
purchasers of the Collateral pursuant to insurance or other applicable law;

 

(o)                                 permit
any Affiliate, employee or officer of Protective Life or any purchasing agent
or selling agent to be a trustee of the Trust;

 

(p)                                 commingle
the assets of the Trust with assets of any Affiliates (including any other
trust organized under the Program), or guarantee any obligation of any
Affiliates (including any trust organized under the Program); or

 

(q)                                 maintain
any joint account with any Person, become a party, whether as co-obligor or
otherwise, to any agreement to which any Person is a party (other than in
respect of the Program Documents), or become liable as a guarantor or otherwise
with respect to any Indebtedness or contractual obligation of any Persons.

 

SECTION
3.16.  Non-Petition.  Each of the Indenture Trustee, the
Administrator, each Holder of a Note, each Agent and Wilmington covenants and
agrees that, for a period of one year plus one day after payment in full of all
amounts payable under or in respect of this Indenture and the Notes, it will
not institute against, or join any other Person in instituting against, the
Trust any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any federal or state bankruptcy or
similar law.  The immediately preceding
sentence shall survive any termination of this Indenture.

 

Notwithstanding
the foregoing, each of the Indenture Trustee and each Agent covenants and
agrees that, it will not institute against, or join any other Person in
instituting against, the Trust any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or other proceedings under any federal
or state bankruptcy or similar law, as a result of the failure to pay fees or
expenses pursuant to Section 7.10 to any party entitled thereto.

 

Moreover, each
of the Indenture Trustee, the Paying Agent, the Transfer Agent, the Calculation
Agent and the Registrar covenants and agrees that it will not cause an Event of

 

42

 

Default as a result of the
Trust’s failure to pay any fees or expenses pursuant to Section 7.10 to
any party entitled thereto.

 

SECTION 3.17. 
Title to the Collateral.  The Trust covenants and agrees that the
Trust owns or, prior to the issuance of the Notes will own, the Funding
Agreement and all of the rest of the Collateral, free and clear of any Liens
other than the security interests or assignments for collateral purposes made
pursuant to Article 4 of this Indenture; and that the Trust is not and will not
become a party to or otherwise be bound by any agreement, other than this
Indenture, which restricts in any manner the rights of any present or future
holder of any of the Collateral with respect thereto.

 

The Trust
shall notify in writing the Indenture Trustee and any Rating Agencies as
promptly as practicable upon becoming aware of any change in the law of the
State of Tennessee following the date of this Indenture with respect to the
priority status of any Funding Agreement in a liquidation of, or other
delinquency proceeding against, Protective Life.

 

SECTION 3.18. 
Withholding and Payment of Additional
Amounts.

 

(a)                                  All
payments due in respect of the Notes will be made free and  clear of any applicable withholding or
deduction for or on account of any present or future taxes, duties, levies,
assessments or other governmental charges of whatever nature imposed or levied
by or on behalf of any governmental authority in the United States having the
power to tax, unless such withholding or deduction is required by law.  Unless otherwise specified in the applicable
Pricing Supplement, if any such withholding or deduction is required by law,
the Trust will not pay any Additional Amounts to Holders in respect of any such
withholding or deduction and any such withholding or deduction will not give
rise to a Default or an Event of Default or any independent right or obligation
to redeem the Notes.  Unless the Funding
Agreement specifies that Protective Life will pay Additional Amounts to the
Trust in the event that any amount due with respect to the Funding Agreement is
subject to withholding or deduction for or on account of any present or future
taxes, duties, levies, assessments or other governmental charges of whatever
nature imposed or levied by or on behalf of any governmental authority in the
United States having the power to tax, and Protective Life is not obligated
under the Funding Agreement to pay any Additional Amounts with respect to such
withholding or deduction, the Trust will be deemed for all purposes of the
Program Documents to have received cash in an amount equal to the amount of any
such withholding or deduction, and each Holder will be deemed for all purposes
of the Program Documents to have received cash in an amount equal to the
portion of such withholding or deduction that is attributable to such Holder’s
interest in the Notes as equitably determined by the Trust.

 

(b)                                    Subject
to the final sentence of this Section 3.18(b), and to the extent
specified in the applicable Pricing Supplement, the Trust shall pay to a Holder
of any Note who is not a “United States person” within the meaning of Section
7701(a)(30) of the Code, Additional Amounts to compensate for any withholding or
deduction for or on account of any present or future taxes, duties, levies,
assessments or other governmental charges of whatever nature imposed or levied
on payments in respect of such Note, by or on behalf of any governmental
authority in the United States having the power to tax, so that the net amount
received by the Holder under that Note, after giving effect to such withholding
or deduction, will equal the amount that would have been received under such
Note were no such deduction or withholding required; provided that the Trust shall not, unless otherwise
specified in the

 

43

 

applicable Pricing Supplement
or a supplemental indenture, be required to make any payment of any Additional
Amount for or on account of: (i) any tax,
duty, levy, assessment or other governmental charge imposed which would have
not been imposed but for (A) the existence of any present or former connection
between the Holder or beneficial owner (as determined for United States federal
income tax purposes) of the Note or the Funding Agreement (any such Holder or
beneficial owner, hereafter, the “Owner”) and such governmental authority,
including without limitation, being or having been a citizen or resident
thereof, or being or having been present therein, incorporated therein,  engaged in a trade or business therein or
having (or having had) a permanent establishment or principal office therein,
(B) such Owner being or having been a controlled foreign corporation within the
meaning of Section 957(a) of the Code related within the meaning of Section
864(d)(4) of the Code to Protective Life, the Trust Beneficial Owner or a
private foundation or other tax-exempt organization, (C) such Owner being or
having been an actual or constructive owner of ten percent (10%) or more of the
total combined voting power of all the outstanding stock of Protective Life or
the Trust Beneficial Owner, (D) such Owner being a bank for United States
federal income tax purposes whose receipt of interest on the Note or Funding
Agreement is described in Section 881(c)(3)(A) of the Code or (E) such Owner
being subject to backup withholding as of the date of becoming an Owner; (ii)
any tax, duty, levy, assessment or other governmental charge which would not
have been imposed but for the presentation of the Note or other evidence of
beneficial ownership thereof (where presentation is required) for payment on a
date more than thirty (30) days after the date on which such payment becomes
due and payable or the date on which payment is duly provided for whichever
occurs later; except to the extent that the Owner would have been entitled to
Additional Amounts had the Note been presented on the last day of such thirty
(30) day period; (iii) any tax, duty, levy, assessment or other governmental
charge which is imposed or withheld by reason of the failure of an Owner to
comply with certification, identification or information reporting requirements
concerning the nationality, residence, identity or connection with the United States
of an Owner (including, without limitation, failure to provide IRS Forms W-8BEN
or W-8ECI), if compliance is required by statute, by regulation of the United
States Treasury Department, judicial or administrative interpretation, other
law or by an applicable income tax treaty to which the United States is a party
as a condition to exemption from such tax, duty, levy, assessment or other
governmental charge;  (iv) any
inheritance, gift, estate, personal property, sales, transfer or similar tax,
duty, levy, assessment or similar governmental charge; (v) any tax, duty, levy,
assessment or  other governmental charge
that is payable otherwise than by withholding from payments in respect of the
Notes; (vi) any tax, duty, levy, assessment or other governmental charge that
would not have been imposed or withheld but for the treatment of payments in
respect of the Notes or the Funding Agreement as contingent interest described
in Section 871(h)(4) of the Code; (vii) any tax, duty, levy, assessment or
other governmental charge that would not have been imposed or withheld but for
an election by the Owner the effect of which is to make payment in respect of
the Notes subject to United States federal income tax; (viii) any tax, duty,
levy, assessment or other governmental charge resulting from a European Union
Directive; or (ix) any combination of items (i), (ii), (iii), (iv), (v), (vi),
(vii) or (viii).  The obligation to pay
Additional Amounts shall not apply unless Protective Life is obligated to pay
additional amounts under the Funding Agreement (1) to compensate for any
withholding or deduction for or on account of any present or future taxes,
duties, levies, assessments or other governmental charges of whatever nature
imposed or levied on payments in respect of the Funding Agreement by or on
behalf of any governmental authority 

 

44

 

in the United States having the
power to tax and (2) to reimburse the Trust for any Additional Amounts due to
Holders.

 

(c)                                  If
the applicable Pricing Supplement indicates that the Trust will pay any
Additional Amounts to Holders as described in Section 3.18(b) and any
such Additional Amounts actually become due and payable the Trust shall deliver
to the Indenture Trustee a Trust Certificate that indicates the amount of such
Additional Amounts and the dates of the payment of such Additional
Amounts.  The Indenture Trustee may
conclusively rely on such Trust Certificate in making the payment of such
Additional Amounts.

 

(d)                                 Whenever
in this Indenture or in any Note there is mentioned, in any context, the
payment of the principal of or any premium or interest on, or in respect of,
any Note or the net proceeds received on the sale or exchange of any Note, such
mention shall be deemed to include mention of the payment of Additional Amounts
if so specified in the applicable Pricing Supplement.  Further, express mention of the payment of Additional Amounts (if
applicable) in any provision hereof shall not be construed as excluding
Additional Amounts in those provisions hereof where such express mention is not
made.

 

SECTION 3.19. 
Additional Representations and
Warranties.

 

(a)                                  The
Trust hereby represents and warrants that:

 

(i)                                     to
the extent the creation of a security interest in the Funding Agreement is
governed by the UCC, this Indenture will create a valid security interest (as
defined in the UCC) in the Funding Agreement in favor of the Indenture Trustee
for the benefit and security of the Holders, which security interest will be
prior to all other Liens;

 

(ii)                                  the
Funding Agreement will constitute a “general intangible,” within the meaning of
the UCC;

 

(iii)                               subject
to the grant of security interest, pledge and collateral assignment of the
Trust’s right, title and interest in the Funding Agreement, the Trust will be a
party to and will be the person entitled to payment under each of the documents
included in the Funding Agreement on the date thereof free and clear of any
Lien, claim or encumbrance of any Person, other then the Lien created hereunder
or any Lien otherwise permitted under this Indenture;

 

(iv)                              to
the extent the UCC applies, the Trust has caused or will have caused, within
ten (10) days of the issuance of the Notes, the filing of all appropriate
financing statements in the proper filing office in the appropriate
jurisdictions under applicable law in order to perfect the security interest in
the Funding Agreement granted to the Indenture Trustee for the benefit and
security of the Holders hereunder;

 

(v)                                 other
than the security interest granted to the Indenture Trustee for the benefit and
security of the Holders pursuant to this Indenture, the 

 

45

 

Trust will not
pledge, assign, sell, grant a security interest in, or otherwise convey any
interest in the Funding Agreement;

 

(vi)                              the
Trust will not authorize the filing of and is not aware of any financing
statements against the Trust that include a description of collateral covering
the Funding Agreement other than any financing statement relating to the
security interest granted to the Indenture Trustee for the benefit and security
of the Holders hereunder; and

 

(vii)                           the
Trust is not aware of any judgment or tax lien filings against the Trust.

 

(b)                                    The
foregoing representations and warranties will survive the execution and
delivery of the Notes. No party will waive any of the foregoing representations
and warranties. The Indenture Trustee and the Trust will maintain the
perfection and priority of the security interest in the Funding Agreement.

 

SECTION 3.20. 
Ancillary Documents.  The Trust hereby expressly
authorizes and directs the Indenture Trustee to execute and deliver each of the
documents, instruments and agreements attached as Exhibits or otherwise
expressly contemplated by the terms of, this Indenture with respect to the
Notes from time to time.

 

ARTICLE 4.

Granting of Security Interest and Assignment for
Collateral Purposes

 

SECTION 4.01. 
Creation.  To secure the full and punctual payment of
the Secured Obligations in accordance with the terms thereof and to secure the
performance of the Trust’s obligations under the Notes and this Indenture, the
Trust hereby assigns and pledges to and with the Indenture Trustee for the
ratable benefit of each Holder and grants to the Indenture Trustee for the
ratable benefit of each Holder security interests in the Collateral, and all of
its rights and privileges with respect to the Collateral, and all income and
profits thereon, and all interest, dividends and other payments and
distributions with respect thereto, and all Proceeds of the foregoing.
Contemporaneously with the issuance of the Notes, the Trust will deliver the
Funding Agreement to the Indenture Trustee or its agent in pledge hereunder and
make such filings, cause Protective Life as the issuer of the Funding Agreement
to register and acknowledge the Indenture Trustee or its agent or the Holders
as having the rights of an assignee for collateral purposes of the Funding
Agreement and take such other action as may be necessary to cause the Indenture
Trustee for the ratable benefit of each Holder to have a perfected security
interest in or be the recipient of a valid assignment for collateral purposes
of the Funding Agreement and the rest of the Collateral that is effective
against the Trust’s creditors and subsequent purchasers thereof.

 

46

 

SECTION 4.02. 
Scope.

 

(a)                                  The
security interest or assignment for collateral purposes granted or made
pursuant to Section 4.01 is granted or made in trust to secure the full
and punctual payment of the Secured Obligations equally and ratably among the
Holders, without prejudice, priority or distinction, except as expressly
provided in this Indenture, in the following order of priority:

 

first, to the payment
of the amounts, for principal, premium, if any, and interest and all such other
amounts, respectively, then due and unpaid in respect of which or for the
benefit of which such amount has been collected, ratably, without preference or
priority of any kind, according to the aggregate amounts due and payable on the
Notes; and

 

second, any
remaining balance shall be paid to the Trust and such remaining balance shall
be distributed by Wilmington in accordance with the Trust Agreement, subject to
Section 3.01(d) of the Trust Agreement.

 

(b)                                 The
Trust does hereby constitute and irrevocably appoint the Indenture Trustee the
true and lawful attorney of the Trust, with full power (in the name of the
Trust or otherwise), for so long as the security interest or assignment for
collateral purposes granted or made pursuant to Section 4.01 shall remain
in effect, to exercise all rights of the Trust with respect to the Collateral
(including as an owner or policyholder of the Funding Agreement) and to ask,
require, demand, receive, settle, compromise, compound and give acquittance for
any and all monies and claims for monies due and to become due under or arising
out of any of the Collateral, to endorse any checks or other instruments or
orders in connection therewith and to file any claims or take any action or
institute any proceedings that the Indenture Trustee may deem to be necessary
or advisable in the circumstances.  The
power of attorney granted pursuant to this Indenture and all authority hereby
conferred are granted and conferred solely to protect the Indenture Trustee’s
interest in the Collateral held for the benefit and security of the Holders and
shall not impose any duty upon the Indenture Trustee to exercise any
power.  This power of attorney shall be
irrevocable as one coupled with an interest prior to the payment in full of all
the Notes.

 

(c)                                  This
Indenture shall constitute a security agreement and an agreement to assign the
Collateral for collateral purposes under the laws of the State of New York
applicable to agreements made and to be performed therein.  Upon the occurrence of any Event of Default
with respect to the Notes, and in addition to any other rights available under
this Indenture and the Funding Agreement or otherwise available at law or in
equity, the Indenture Trustee shall have all rights and remedies of a secured
party or an assignee for collateral purposes on default under the laws of the
State of New York and other applicable law to enforce the assignments and
security interests contained herein and, in addition, shall have the right,
subject to compliance with any mandatory requirements of applicable law, to
sell or apply the Funding Agreement and any other rights and other interests
assigned or pledged hereby in accordance with the terms of this Indenture at
public or private sale.  All amounts
received hereunder shall be applied first to all costs and expenses incurred by
the Indenture Trustee in connection with such collection and enforcement and
thereafter as provided in this Indenture.

 

(d)                                 It
is expressly agreed that anything herein or therein contained to the contrary
notwithstanding, the Trust shall remain liable under the Funding Agreement to
perform all the obligations of it thereunder, all in accordance with and
pursuant to the terms and provisions thereof, and the Indenture Trustee shall
not have any obligations or liabilities with

 

47

 

respect to the Funding
Agreement by reason of or arising out of this Indenture, nor shall the Indenture
Trustee be required or obligated in any manner to perform or fulfill any
obligations of the Trust under or pursuant to the Funding Agreement or, other
than as provided in this Indenture, to make any payment, to make any inquiry as
to the nature or sufficiency of any payment received by it, or, prior to the
occurrence and continuance of an Event of Default, to present or file any
claim, or to take any action to collect or enforce the payment of any amounts
that may have been assigned to it or to which it may be entitled at any time or
times.

 

(e)                                  The
Indenture Trustee acknowledges the granting of such security interests and the
making of such assignments for collateral purposes, accepts the terms hereunder
in accordance with the provisions hereof and agrees to perform its duties
herein subject to and with the benefit of the provisions hereof, to the end
that the interests of the Holders may be adequately and effectively protected.

 

SECTION 4.03. 
Termination of Security Interest.  Upon the payment in full of all Secured
Obligations relating to the Notes, the security interest shall terminate and
all rights to the Collateral shall revert to the Trust.  Upon termination of the security interest,
the Indenture Trustee will execute and deliver to the Trust such documents as
the Trust shall reasonably request to evidence the termination of the security
interest.

 

ARTICLE 5

Satisfaction  and
Discharge; Subrogation

 

SECTION 5.01. 
Satisfaction and Discharge of
Indenture.  This Indenture
shall cease to be of further effect with respect to the Notes (except as to any
surviving rights of registration of transfer or exchange of Notes herein
expressly provided for) and the Indenture Trustee, on written demand of the
Trust, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture with respect to the Notes, when

 

(a)                                  either:

 

(i)                                     all
Notes theretofore authenticated and delivered (other than Notes which have been
mutilated, destroyed, lost or stolen and which have been replaced or paid as provided
in Section 2.08) have been delivered to the Indenture Trustee for
cancellation; or

 

(ii)                                  all
Notes

 

(A)                              have become due and
payable,

 

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

 

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

 

48

 

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

 

(b)                                 the
Trust has paid or caused to be paid in full all other sums payable hereunder by
the Trust with respect to the Secured Obligations; and

 

(c)                                  the
Trust has delivered to the Indenture Trustee a Trust Certificate and an Opinion
of Counsel each stating that all conditions precedent herein providing for the
satisfaction and discharge of this Indenture with respect to the Notes have
been complied with.

 

Notwithstanding
the satisfaction and discharge of this Indenture with respect to the Notes, the
obligations of the Indenture Trustee under Section 5.02 shall survive.

 

SECTION 5.02. 
Application of Trust Money.  All money deposited with the Indenture
Trustee pursuant to this Indenture shall be held in trust in the Collection
Account and applied by it, in accordance with the provisions of the Notes and
this Indenture, to the payment through any Paying Agent, to the Persons
entitled thereto, of the principal, premium, if any, interest and Additional
Amounts, if any, for whose payment such money has been deposited with or received
by the Indenture Trustee.

 

If no Event of Default with
respect to the Notes exists, the following priority of payments shall apply:

 

first, to the
payment of the amounts then due and unpaid upon the Notes for principal,
premium, if any, and interest and all other amounts in respect of which or for
the benefit of which such amount has been collected, ratably, without
preference or priority of any kind, according to the aggregate principal
amounts due and payable on the Notes; and

 

second, any remaining
balance shall be paid to the Trust and such remaining balance shall be
distributed by Wilmington in accordance with the Trust Agreement, subject to
Section 3.01(d) of the Trust Agreement.

 

ARTICLE 6

Defaults and Remedies

 

SECTION 6.01. 
Events of Default.

 

“Event of Default,” wherever used herein,
means any one of the following events with respect to the Notes (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):

 

49

 

(a)                                  failure
to pay the principal or premium, if any, of any Note and the continuance of
such failure for a period of one (1) Business Day after such principal or
premium, if any, becomes due and payable;

 

(b)                                 failure
to pay any interest on any Note within five (5) Business Days after such
interest becomes due and payable;

 

(c)                                  an
“Event of Default” (as defined in the Funding Agreement) by Protective Life
under the Funding Agreement securing the Notes;

 

(d)                                 failure
to observe or perform in any material respect any one or more of the other
covenants in this Indenture (other than a covenant or default or breach of
which is specifically set forth in Section 6.01(a), (b) and, if
applicable (h)) or the Notes, and continuance of such failure for a
period of sixty (60) days after the date on which there shall have been given
written notice by registered or certified mail, return receipt requested,
specifying such failure, thereof to the Trust by the Indenture Trustee or to
the Trust and the Indenture Trustee by Holders of Notes representing at least
twenty-five percent (25%) of the aggregate principal amount of the Outstanding
Notes, which written notice shall be delivered by registered or certified mail,
return receipt requested, and shall specify such failure and require such
failure to be remedied and which notice shall state that it is a “Notice of Default” hereunder;

 

(e)                                  this
Indenture for any reason shall cease to be in full force and effect (other than
in accordance with its terms) or shall be declared null and void, or the
Indenture Trustee fails to have or maintain a validly created and perfected
security interest subject to no prior Liens or security interests in the
Collateral and proceeds thereof except as expressly permitted hereby; or any
Person shall successfully claim as finally determined by a court of competent
jurisdiction that any of the Liens granted to the Indenture Trustee with
respect to any of the Collateral are void or that the enforcement thereof or
any other recourse by the Indenture Trustee against any of the Collateral is
materially limited because of any preference, fraudulent transfer, conveyance
or similar law;

 

(f)                                    either
(i)  a court having jurisdiction in the
premises shall enter a decree or order for relief in respect of the Trust or
the Collateral in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect in the State of
Delaware or any other applicable jurisdiction, which decree or order is not
stayed; or any other similar relief shall be granted under any applicable law;
or (ii) an involuntary case shall be commenced against the Trust or the
Collateral under any applicable bankruptcy, insolvency or other similar law of
the State of Delaware or any other applicable jurisdiction; or a decree or
order of a court having jurisdiction in the premises for the appointment of a
receiver, liquidator, sequestrator, trustee, custodian or other officer having
similar powers over the Trust or the Collateral, or over all or a substantial
part of its property, shall have been entered; or there shall have occurred the
involuntary appointment of an interim receiver, trustee or other custodian of
the Trust or the Collateral for all or a substantial part of its property; or a
court having jurisdiction in the premises shall enter a decree or order
declaring the dissolution of the Trust; or a warrant of attachment, execution
or similar process shall have been issued against any substantial part of the
property of the Trust and any such event described in this clause (ii) shall
continue for sixty (60) days unless dismissed, bonded or discharged;

 

50

 

(g)                                 either
(i)  the Trust shall have an order for
relief entered with respect to it or shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law of the State of Delaware
or any other applicable jurisdiction, or shall consent to the entry of an order
for relief in an involuntary case, or to the conversion of an involuntary case
to a voluntary case, under any such law, or shall consent to the appointment of
or taking possession by a receiver, trustee or other custodian for all or a
substantial part of its property; or the Trust shall make any assignment for
the benefit of creditors; or (ii) the Trust shall fail or be unable, or the
Trust admits in writing its inability, to pay its debts as such debts become
due; or the trustee of the Trust shall adopt any resolution or otherwise
authorize any action to approve or for the purpose of effecting any of the
actions referred to in this paragraph (g); or

 

(h)                                 any
other Event of Default provided in (i) the applicable Prospectus Supplement or
the applicable Pricing Supplement and (ii) the Notes or any supplemental
indenture.

 

SECTION 6.02. 
Acceleration of Maturity Date;
Rescission and Annulment.  If
an Event of Default specified in any of Sections 6.01(a), (b), (c),
(f) or (g) hereof occurs, the principal of and all accrued and
unpaid interest and any other amounts payable on the Notes shall automatically
be and become due and payable immediately, without any declaration or other act
whatsoever on the part of the Trust, the Indenture Trustee or any Holder.  If any Event of Default other than those
specified in Sections 6.01(a), (b), (c), (f) or (g)
hereof occurs and is continuing, then in every such case the Indenture Trustee
or the Holders of more than twenty-five percent (25%) in aggregate principal
amount of the Outstanding Notes, by a notice in writing to the Trust (and to
the Indenture Trustee if given by the Holders of the Notes), may (but are not
required to) declare the sum of (a) the principal amount of all the Outstanding
Notes and (b) any other amounts, including accrued and unpaid interest, payable
to the Holders to the extent such amounts are permitted by law to be paid, to
be due and payable immediately, and upon any such declaration such amount shall
become due and payable on the date the written declaration is received by the
Trust; provided, however, that with respect to any Note
issued with original issue discount the amount of principal due and payable for
such Note will be the amount determined as set forth in the Pricing Supplement
or, if not so set forth, by multiplying (i) the then outstanding aggregate
principal amount of such Note by (ii) the sum of (A) the original issue price
of the Note (expressed as a percentage of the then outstanding aggregate
principal amount of such Note) plus (B) the original issue discount (expressed
as a percentage) amortized from the original issue date of such Note to the
date of declaration of acceleration of maturity of such Note (calculated using
the interest method in accordance with generally accepted accounting principles
in effect on the date of determination).

 

At any time
after such a declaration of acceleration of maturity of the Notes has been made
pursuant to the second sentence of this Section 6.02 and before a
judgment or decree for payment of the money due has been obtained by the
Indenture Trustee as hereinafter provided in this Article, the Holders of Notes
representing at least sixty-six and two-thirds percent (66-2/3%) of the
aggregate principal amount of the Outstanding Notes, by written notice to the
Trust and the Indenture Trustee, may rescind and annul such declaration and its
consequences if

 

(a)                                  the
Trust has paid or deposited with the Indenture Trustee a sum sufficient to pay

 

51

 

(i)                                     all overdue
installments of interest and Additional Amounts, if applicable, on all Notes,

 

(ii)                                  the principal and
premium, if any, of any Notes which have become due otherwise than by such
declaration of acceleration and interest thereon with respect thereto at the
rate borne by the Notes, and

 

(iii)                               all sums paid or
advanced by the Indenture Trustee hereunder; and

 

(b)                                 all
Events of Default, other than the nonpayment of the principal of or interest on
the Notes which have become due solely as a result of such acceleration, have
been cured or waived as provided in Section 6.13.

 

No such
rescission shall affect any subsequent Default or Event of Default or impair
any right consequent thereon.

 

SECTION 6.03. 
Collection of Indebtedness and Suits
for Enforcement.  The Trust
covenants that if

 

(a)                                  default
is made in the payment of any installment of interest on any Note when such
interest becomes due and payable (after the expiration of any applicable cure
period), or

 

(b)                                 default
is made in the payment of the principal or premium, if any, of any Note when
such principal or premium, if any, becomes due and payable,

 

the Trust will upon demand of
the Indenture Trustee (which the Indenture Trustee may make, but is not
required to make) pay to the Indenture Trustee, for the benefit of all the
Holders of the Notes, the whole amount then due and payable on the Notes and,
in addition thereto, such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee, its agents and
counsel.

 

If the Trust
fails to pay such amounts it is required to pay the Indenture Trustee pursuant
to the preceding paragraph, then forthwith upon the demand of the Indenture
Trustee, in its own name and as trustee of an express trust, the Indenture
Trustee may (but is not required to) institute a judicial proceeding for the
collection of the sums so due and unpaid, may prosecute such proceeding to
judgment or final decree and may enforce the same against the Trust or any
other obligor upon any of the Notes and collect the monies adjudged or decreed
to be payable in the manner provided by law out of the property of the Trust or
any other obligor upon the Notes, including the Collateral, wherever situated.

 

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

 

52

 

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

 

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

 

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

 

and any custodian, receiver,
assignee, trustee, liquidator, sequestrator or other similar official in any
such judicial proceeding is hereby authorized by each Holder to make such
payments to the Indenture Trustee and, in the event that the Indenture Trustee
shall consent, to make such payments directly to the Holders, and to pay to the
Indenture Trustee any amount due to it for the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee, its agents and
counsel, and any other amounts due to the Indenture Trustee under Section
7.10.

 

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

 

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

 

SECTION 6.06. 
Application of Money Collected.  Notwithstanding anything herein
to the contrary, any money collected by the Indenture Trustee following an
Event of Default and during the continuance thereof pursuant to Article 6
or otherwise under this Indenture, any supplements hereto or the Funding
Agreement, and any moneys that may then be held or thereafter received by the
Indenture Trustee as security with respect to the Notes shall be held in the
Collection Account and be applied in the following order, at the date or dates
fixed by the 

 

53

 

Indenture Trustee and, in case
of the distribution on account of principal or interest, upon presentation of
the Notes, or both, and the notation thereon of the payment if only partially
paid and upon surrender thereof if fully paid:

 

first, to the
payment of the reasonable and customary expenses and counsel fees incurred by
the Indenture Trustee and any other amounts due and unpaid to the Indenture
Trustee by the Trust, in an aggregate amount of no more than $250,000 for all
notes issued under the Program, to the extent not paid pursuant to the Expense
and Indemnity Agreement;

 

second, to the
payment of the amounts then due and unpaid upon the Notes for principal,
premium, if any, and interest and all other amounts in respect of which, or for
the benefit of which, such amount has been collected, ratably, without
preference or priority of any kind, according to the aggregate principal
amounts due and payable on the Notes; and

 

third, any remaining
balance shall be paid to the Trust and such remaining balance shall be
distributed by Wilmington in accordance with the Trust Agreement, subject to
Section 3.01(d) of the Trust Agreement.

 

Except as
expressly set forth herein, none of the Indenture Trustee, Paying Agent,
Registrar or any other Agent or any of their successors, employees, officers,
directors, affiliates or agents shall have any claim or rights of any nature in
or to the Collateral, whether as a result of set-off, banker’s lien or
otherwise, and the Indenture Trustee hereby waives, and the Paying Agent and
Registrar appointed hereunder shall be deemed to have waived, by its acceptance
of the duties hereunder, on behalf of itself and each such other Person, any
such claim or rights in or to the Collateral.

 

SECTION 6.07. 
Limitation on Suits.  Except as otherwise provided in Section
6.08, no Holder shall have any right to institute any proceedings, judicial
or otherwise, with respect to this Indenture or any agreement or instrument
included in the Collateral for the Notes or for the appointment of a receiver
or trustee, or for any other remedy hereunder, unless:

 

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

 

(b)                                 the
Holder or Holders of Notes representing not less than twenty-five percent (25%)
of the aggregate principal amount of the Outstanding Notes shall have made
written request to the Indenture Trustee to institute proceedings in respect of
such Event of Default in its own name as Indenture Trustee hereunder;

 

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

 

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

 

54

 

(e)                                  no
direction inconsistent with such written request has been given to the
Indenture Trustee during such sixty (60) day period by the Holder or Holders of
Notes representing at least a majority in aggregate principal amount of the
Outstanding Notes;

 

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

 

SECTION 6.08. 
Unconditional Rights of Holders to
Receive Payments.  Notwithstanding
any other provision in this Indenture, each Holder of any Note shall have the
right, which is absolute and unconditional, to receive payment of the principal
of, any interest on, and premium, if any, on such Note on the respective Stated
Maturity Date or redemption date thereof and to institute suit for the
enforcement of any such payment, and such rights shall not be impaired without
the consent of such Holder.

 

SECTION 6.09. 
Restoration of Rights and
Remedies.  If the Indenture
Trustee or any Holder has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Indenture
Trustee or to such Holder, then and in every such case the Trust, the Indenture
Trustee and each such Holder shall, subject to any determination in such
proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Indenture Trustee and
each such Holder shall continue as though no such proceeding had been
instituted.

 

SECTION 6.10. 
Rights and Remedies Cumulative.  Except as otherwise provided with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Notes in Section 2.08, no right or remedy herein conferred upon or
reserved to the Indenture Trustee or to each and every Holder is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to
the extent permitted by law, be cumulative and in addition to every other right
and remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any
other appropriate right or remedy.

 

SECTION 6.11. 
Delay or Omission Not Waiver.  No delay or omission of the
Indenture Trustee or of any Holder 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 right or remedy accruing upon any Event of Default or an
acquiescence therein.  Every right and
remedy given by this Article or by law to the Indenture Trustee or to any
Holder may be exercised from time to time, and as often as may be deemed
expedient, by the Indenture Trustee or by such Holder, as the case may be.

 

SECTION 6.12. 
Control by Holders.  Holders, representing at least a
majority  of the aggregate
principal amount of the Outstanding Notes, who provide the Indenture Trustee
with indemnification satisfactory to the Indenture Trustee, shall have the
right to direct the time,

 

55

 

method and place of conducting
any proceedings for exercising any remedy available to the Indenture Trustee or
exercising any trust or power conferred on the Indenture Trustee with respect
to the Notes, including with respect to the Collateral; provided, however, that (a) such direction
shall not be in conflict with any rule of law or with this Indenture and (b)
the Indenture Trustee may take any other action deemed proper by the Indenture
Trustee that is not inconsistent with such direction.

 

SECTION 6.13. 
Waiver of Past Defaults.  Notwithstanding anything herein
to the contrary, only Holders representing a majority  of the aggregate principal amount of the Outstanding Notes
may on behalf of the Holders of all the Notes waive any past Default hereunder
with respect thereto and its consequences, except a Default

 

(a)                                  in
the payment of any principal of, any interest on, or premium, if any, on any
Note, or

 

(b)                                 in
respect of a covenant or provision hereof that cannot be modified or amended
without the consent of the Holder of each Outstanding Note.

 

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

 

SECTION 6.14. 
Undertaking for Costs.  All parties to this Indenture
agree, and each Holder, by acceptance of a Note, shall be deemed to have agreed
that, in any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Indenture Trustee for any action taken, suffered
or omitted by it as Indenture Trustee, any court may in its discretion require
the filing by any party litigant in such suit of an undertaking to pay the
costs of such suit, and that such court may in its discretion assess reasonable
costs, including reasonable attorneys’ fees, against any party litigant in such
suit, having due regard to the merits and good faith of the claims or defenses
made by such party litigant; but the provisions of this Section shall not apply
to any suit instituted by the Indenture Trustee or any Agent, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate Notes
representing more than ten percent (10%) of the aggregate principal amount of
the Outstanding Notes, or to any suit instituted by any Holder for the
enforcement of the payment of any installment of interest on any Note on or
after the Stated Maturity Date thereof expressed in such Note or for the
enforcement of the payment of any principal of such Note at the Stated Maturity
Date therefor.

 

SECTION 6.15. 
Waiver of Stay or Extension
Laws.  The Trust covenants
that it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any law wherever enacted, now or at
any time hereafter in force, providing for any appraisement, valuation, stay,
extension or redemption, which may affect the covenants in, or the performance
of, this Indenture; and the Trust hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Indenture Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.

 

56

 

ARTICLE 7

The Indenture Trustee and Other Agents

 

SECTION 7.01. 
Duties of Indenture Trustee and
Agents.

 

(a)                                  If
an Event of Default has occurred and is continuing, the Indenture 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 person would
exercise or use under the circumstances in the conduct of his or her own
affairs.

 

(b)                                 Except
during the continuance of an Event of Default, the duties and liabilities of
the Indenture Trustee are to perform only those duties that are specifically
set forth in this Indenture and no others, and no implied covenants or
obligations of the Indenture Trustee shall be read into this Indenture.

 

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

 

(i)                                     this
subsection does not limit the effect of subsection (b) of this Section 7.01;

 

(ii)                                  each
of the Indenture Trustee and each Agent may in good faith rely, as to the truth
of the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to it and conforming to the requirements of
this Indenture unless a Responsible Officer of the Indenture Trustee or such
Agent, respectively, has actual knowledge that such statements or opinions are
false; provided that the
Indenture Trustee or Agent, as the case may be, must examine such certificates
and opinions to determine whether they conform to the requirements of this
Indenture;

 

(iii)                               each
of the Indenture Trustee and each Agent shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is proved that
the Indenture Trustee or Agent, as the case may be, was negligent in
ascertaining the pertinent facts;

 

(iv)                              the
Indenture Trustee shall not be liable with respect to any action it takes or
omits to take in good faith in accordance with the direction of Holders
representing at least a majority of the aggregate principal amount of the
Outstanding Notes or pursuant to Section 6.07 for actions or omissions
relating to the time, method and place of conducting any proceeding for any
remedy available to the Indenture Trustee, or exercising any trust or power
conferred upon the Indenture Trustee, under this Indenture with respect to the
Notes; and

 

(v)                                 no
provision of this Indenture shall require the Indenture Trustee or any Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for 

 

57

 

believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.

 

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

 

(e)                                  The
Indenture Trustee shall promptly upon its receipt thereof deliver to each
Rating Agency copies of each of the following:

 

(i)                                     any
notice of any Event of Default by any party under the Funding Agreement
delivered by the Trust to the Indenture Trustee pursuant to paragraph (b) of Section
3.13;

 

(ii)                                  any
amendment or modification of the Trust Agreement delivered by the Trust to the
Indenture Trustee pursuant to paragraph (a) of Section 3.12;

 

(iii)                               any
notice of any Default or Event of Default, together with any relevant Trust
Certificate relating thereto, delivered by the Trust to the Indenture Trustee
pursuant to paragraph (b) of Section 3.13;

 

(iv)                              any
supplemental indenture referred to in Section 8.01 or 8.02;

 

(v)                                 any
other information reasonably requested by any Rating Agency;

 

(vi)                              any
notice of change in the identity of the Trust;

 

(vii)                           any
notice of change in the identity of the Indenture Trustee;

 

(viii)                        any
notice of adverse change in the priority status of the Funding Agreement as a
matter of the laws of the State of Tennessee; and

 

(ix)                                any
notice delivered to the Indenture Trustee under Section 3.12.

 

(f)                                    The
Indenture Trustee shall, on behalf of the Trust, and to the extent that the
relevant information shall be reasonably available to it, submit such reports
or information as may be required from time to time in relation to the issue of
the Notes by applicable law, regulations and guidelines by governmental
regulatory authorities as may be subsequently requested by the Trust and agreed
to in writing between the Trust and the Indenture Trustee.

 

SECTION 7.02. 
No Liability to Invest.  None of the Agents shall be under any
liability for interest on, or have any responsibility to invest, any monies
received by it pursuant to any of the provisions of this Indenture or the
Notes.

 

58

 

SECTION 7.03. 
Performance Upon Default.  None of the Agents shall have any duty or
responsibility in case of any default by the Trust in the performance of its
obligations (including, without limiting the generality of the foregoing, any
duty or responsibility to accelerate all or any of the Notes or to initiate or
to attempt to initiate any proceedings at law or otherwise or to make any
demand for the payment thereof upon the Trust).

 

SECTION 7.04. 
No Assumption by Paying Agent,
Transfer Agent, Calculation Agent or Registrar.  In acting hereunder and in connection with
the Notes, the Paying Agent, the Transfer Agent, the Calculation Agent and the
Registrar shall act solely as agents of the Trust and will not thereby assume
any obligations towards, or relationship of agency or trust for, any of the
Holders.

 

SECTION 7.05. 
Notice of Default.  Within ninety (90) days after a
Responsible Officer of the Indenture Trustee becomes aware of the occurrence of
any Default or Event of Default which is continuing hereunder, the Indenture
Trustee shall transmit to Wilmington and all Holders of Notes notice of each
such Default or Event of Default hereunder known to the Indenture Trustee,
unless such Default or Event of Default shall have been cured or waived; provided, however, that, except in the
case of a Default of the kind described in Section 6.01(a), (b), (c),
(f) or (g) the Indenture Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors and/or Responsible Officers of the
Indenture Trustee in good faith determine that the withholding of such notice
is in the interests of the Holders.

 

SECTION 7.06. 
Rights of Indenture Trustee.  Subject to the provisions of Section
7.01(c):

 

(a)                                  The
Indenture Trustee may rely on any document believed by it in good faith to be
genuine and to have been signed or presented by the proper Person. The
Indenture Trustee need not investigate any fact or matter stated in the
document.

 

(b)                                 Before
the Indenture Trustee acts or refrains from acting it may require a Trust
Certificate or an Opinion of Counsel (or may consult with financial or other
advisors or consultants appointed with due care). The Indenture Trustee shall
not be liable for any action it takes or omits to take in good faith in
reliance on any Trust Order, Trust Request, Trust Certificate, Opinion of
Counsel or advice from financial or other advisors or consultants appointed
with due care.

 

(c)                                  The
Indenture Trustee may act through agents or attorneys and shall not be
responsible for monitoring or supervising the actions of, or for the misconduct
or negligence of, any agent or attorney appointed with due care.

 

(d)                                 The
Indenture Trustee shall not be liable for any action it takes or omits to take
in good faith that it believes to be authorized or within its rights or powers.

 

(e)                                  (i)                                     The
Indenture Trustee may employ or retain such counsel, accountants, appraisers,
agents or other experts or advisers as it may reasonably require for the
purpose of determining and discharging its rights and duties hereunder and
shall not be responsible for misconduct on the part of any such person
appointed with due care.

 

59

 

(ii)                                  The
Indenture Trustee may act and rely and shall be protected in acting and relying
in good faith on the opinion or advice of or information obtained from any
counsel, accountant, appraiser, agents or other expert or adviser, whether
retained or employed by the Trust or by the Indenture Trustee, in relation to any
matter arising in the administration of the trusts hereof.

 

(f)                                    The
Indenture Trustee may consult with counsel of its selection and the advice of
such counsel or any opinion of counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon.

 

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

 

(h)                                 The
Indenture Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Indenture Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the
Indenture Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Trust, personally or by agent or attorney, with any reasonable costs
related thereto to be paid by Protective Life pursuant to the Expense and
Indemnity Agreement, and shall incur no liability or additional liability of
any kind by reason of such inquiry or investigation.

 

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

 

(j)                                     Permissive
powers granted to the Indenture Trustee hereunder shall not be construed to be
mandatory duties on its part.

 

(k)                                  The
rights and protections afforded to the Indenture Trustee pursuant to this Article
7 shall also be afforded to the Paying Agent, Calculation Agent, Registrar
or Transfer Agent, or any successor or agent thereof.

 

(l)                                     The
Indenture Trustee shall have no liability for the actions or omissions of the
Paying Agent, Registrar, Calculation Agent or Transfer Agent, provided that such action omission is not
caused by the Indenture Trustee’s own negligence, bad faith or willful
misconduct.

 

60

 

(m)                               The
Indenture Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through delegates, agents,
attorneys, custodians, or nominees, and the Indenture Trustee shall not be
responsible for any misconduct or negligence on the part, or the supervision,
of any agent, attorney, custodian, or nominee appointed with due care hereunder
except as otherwise agreed in writing with the Trust.

 

SECTION 7.07. 
Not Responsible for Recitals or
Issuance of Notes.  The
recitals contained herein and in the Notes, except the certificates of
authentication on the Notes, shall be taken as the statements of the Trust and
neither the Indenture Trustee nor any Agent assumes any responsibility for
their correctness. Neither the Indenture Trustee nor any Agent makes any
representations with respect to any Collateral or as to the validity,
enforceability or sufficiency of this Indenture or of the Notes or of any
security interest created hereunder. Neither the Indenture Trustee nor any Agent
shall be accountable for the use or application by the Trust of the Notes or
the proceeds thereof or any money paid to the Trust or upon Trust Order
pursuant to the provisions hereof.

 

SECTION 7.08. 
Indenture Trustee May Hold
Notes.  The Indenture Trustee,
in its individual or any other capacity, may become the owner or pledgee of
Notes and, subject to Section 7.11 herein and Section 311(a) of the
Trust Indenture Act,  may
otherwise deal with the Trust with the same rights it would have if it were not
Indenture Trustee.

 

SECTION 7.09. 
Money Held in Trust.  Money held by the Indenture
Trustee in trust hereunder need not be segregated from other funds except to
the extent required by this Indenture or by law. The Indenture Trustee shall be
under no liability for interest on any money received by it hereunder and shall
not invest such money, unless otherwise agreed to in writing and permitted by
law.

 

SECTION 7.10. 
Compensation and Reimbursement.  The Indenture Trustee and the
Agents will be entitled to payment of fees, reimbursement for, and
indemnification with respect to, costs and expenses for services rendered
hereunder to the extent provided in the Expense and Indemnity Agreement and,
with respect to only the Indenture Trustee, Section 6.06.  Except as provided in Section 6.06
with respect to the Indenture Trustee, none of the Indenture Trustee, Paying
Agent, Registrar or Transfer Agent shall be entitled to seek any payment from
the Trust with respect to its services hereunder.

 

SECTION 7.11. 
Eligibility.  The Trust agrees, for the benefit
of the Holders, that there shall at all times be an Indenture Trustee hereunder
which shall be a corporation or national banking association organized and
doing business under the laws of the United States, any state thereof or the
District of Columbia, authorized under such law to exercise corporate trust
powers, having a combined capital
and surplus of at least $250,000,000 subject to supervision or examination by
federal or state authority and having a credit rating of BBB- or better by
Standard & Poor’s Ratings Service, a Division of the McGraw-Hill Companies
or a credit rating of Baa3 or better by Moody’s Investors Service, Inc. If such
corporation publishes reports of condition at least annually, pursuant to law
or to the requirements of said supervising or examining authority, then for the
purposes of this Section 7.11, 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 as published. If at any time the
Indenture Trustee shall cease to be

 

61

 

eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.

 

In addition,
the Indenture Trustee, each successor Indenture Trustee and each Person
appointed to act as co-trustee pursuant to Section 7.15 hereof must be a
“United States person” within the meaning of Section 7701(a)(30) of the Code.

 

SECTION 7.12. 
Resignation and Removal; Appointment
of Successor.

 

(a)                                  No
resignation or removal of the Indenture Trustee and no appointment of a
successor Indenture Trustee pursuant to this Section shall become effective
until the acceptance of appointment by the successor Indenture Trustee under Section
7.13.

 

(b)                                 The
Indenture Trustee may resign at any time by giving not less than ninety (90)
days’ prior written notice thereof to the Trust. If an instrument of acceptance
by a successor Indenture Trustee shall not have been delivered to the Indenture
Trustee within thirty (30) days after the giving of such notice of resignation,
the resigning Indenture Trustee may petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee and any and
all amounts then due and owing to the retiring Indenture Trustee shall be paid
in full.

 

(c)                                  The
Indenture Trustee may be removed at any time by an Act of Holders of Notes
representing a majority of the aggregate principal amount of the Outstanding
Notes, delivered to the Indenture Trustee and to the Trust.

 

(d)                                 If
at any time (i) the Indenture Trustee shall cease to be eligible under Section
7.11 and shall fail to resign after written request by the Trust or any
Holder (who has been a bona fide Holder of a Note for at least six months),
(ii) shall become incapable of acting or shall be adjudged as bankrupt or
insolvent, or a receiver or liquidator of the Indenture Trustee or of its
property shall be appointed, or any public officer shall take charge or control
of the Indenture Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation or (iii) the Indenture Trustee
shall fail to comply with the obligations imposed upon it under Section 310(b)
of the Trust Indenture Act with respect to the Notes after written request
therefor by the Trust or any Holder who has been a bona fide Holder of a Note
for at least six months, then, (x) the Trust (except during the existence of an
Event of Default) by a Trust Order may remove the Indenture Trustee, or (y)
subject to Section 6.14, any Holder who has been a bona fide Holder for
at least six months may, on behalf of himself, herself or itself and all others
similarly situated, petition any court of competent jurisdiction for the
removal of the Indenture Trustee and the appointment of a successor Indenture
Trustee.

 

(e)                                  If
the Indenture Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of the Indenture Trustee for any
cause, the Trust, by a Trust Order, shall promptly appoint a successor
Indenture Trustee and shall comply with the applicable requirements of Section
7.13. If within one year after such resignation, removal or incapability or
the occurrence of such vacancy a successor Indenture Trustee shall be appointed
by Act of Holders of Notes representing a majority of the aggregate principal
amount of the Outstanding Notes delivered to the Trust and the retiring
Indenture Trustee, the successor 

 

62

 

Trustee so appointed shall,
upon its acceptance of such appointment in accordance with the applicable
requirements of Section 7.13, become the successor Indenture Trustee and
supersede the successor Indenture Trustee appointed by the Trust. If no
successor Indenture Trustee shall have been so appointed by the Trust or
Holders and shall have accepted appointment in the manner hereinafter provided,
any Holder who has been a Holder for at least six months may (subject to Section
6.14), on behalf of himself, herself or itself and all others similarly
situated, petition any court of competent jurisdiction for the appointment of a
successor Indenture Trustee.

 

(f)                                    The
Trust shall give notice of each resignation and each removal of the Indenture
Trustee and each appointment of a successor Indenture Trustee by mailing
written notice of such event by first-class mail, postage prepaid, to the
Holders of the Notes, if any, as their names and addresses appear in the
Register.  Each notice shall include the
name of the successor Indenture Trustee and the address of its Corporate Trust
Office.

 

(g)                                 Any
successor Indenture Trustee shall satisfy all applicable requirements under
this Indenture.

 

SECTION 7.13. 
Acceptance of Appointment by
Successor.

 

(a)                                  Every
successor Indenture Trustee appointed hereunder shall execute, acknowledge and
deliver to the Trust and the retiring Indenture Trustee an instrument accepting
such appointment, and thereupon the resignation or removal of the retiring
Indenture Trustee shall become effective and such successor Indenture Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Indenture Trustee. Notwithstanding
the foregoing, on request of the Trust or the successor Indenture Trustee, such
retiring Indenture Trustee shall, upon payment of all amounts owed to it,
execute and deliver an instrument transferring to such successor Indenture
Trustee all the rights, powers and trusts of the retiring Indenture Trustee,
and shall duly assign, transfer and deliver to such successor Indenture Trustee
all property and money held by such retiring Indenture Trustee hereunder.  Upon request of any such successor Indenture
Trustee, the Trust shall execute and deliver any and all instruments for more
fully and certainly vesting in and confirming to such successor Indenture
Trustee all such rights, powers and trusts.

 

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

 

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

 

SECTION 7.14. 
Merger, Conversion, Consolidation or
Succession to Business of Indenture Trustee. 
Any corporation or national banking association into which
the Indenture Trustee may be merged or converted or with which it may be
consolidated, or any corporation or national banking association resulting from
any merger, conversion or consolidation to which the Indenture Trustee shall be
a party, or any corporation or national banking association succeeding

 

63

 

to all or substantially all of
the corporate trust business of the Indenture Trustee, shall be the successor
of the Indenture Trustee hereunder, without the execution or filing of any
paper or any further act on the part of any of the parties hereto; provided, however, that such corporation
or national banking association shall be otherwise qualified and eligible under
this Article. In case any Notes have been authenticated, but not delivered, by
the Indenture Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Indenture Trustee may adopt such authentication
and deliver the Notes so authenticated with the same effect as if such
successor Indenture Trustee had authenticated such Notes.

 

SECTION 7.15. 
Co-trustees.

 

(a)                                  At
any time or times, for the purpose of meeting the legal or regulatory
requirements of any jurisdiction in which any portion of any Collateral may at
the time be located, the Trust and the Indenture Trustee shall have power to
appoint, and, upon the written request of the Holders of Notes representing a
majority of the aggregate principal amount of the Outstanding Notes, the Trust
shall for such purpose join with the Indenture Trustee in the execution,
delivery and performance of all instruments and agreements necessary or proper
to appoint one or more Persons approved by the Indenture Trustee to act as
co-trustee, jointly with the Indenture Trustee, of all or any part of the
Collateral, with such powers as may be provided in the instrument of
appointment, and to vest in such Person or Persons in the capacity aforesaid,
any property, title, right or power deemed necessary or desirable, subject to
the other provisions of this Section. If the Trust does not join in such
appointment within fifteen (15) days after the receipt by it of a request so to
do, or in case an Event of Default has occurred and is continuing, the
Indenture Trustee alone shall have power to make such appointment.

 

(b)                                 Should
any written instrument from the Trust be required by any co-trustee so
appointed for more fully confirming to such co-trustee such property, title,
right or power, any and all such instruments shall, on request, be executed,
acknowledged and delivered by the Trust.

 

(c)                                  Every
co-trustee shall, to the extent permitted by law, but to such extent only, be
appointed subject to the following terms:

 

(i)                                     the
Notes shall be authenticated and delivered and all rights, powers, duties and
obligations hereunder in respect of the custody of securities, cash and other
personal property held by, or required to be deposited or pledged with, the
Indenture Trustee hereunder, shall be exercised solely by the Indenture
Trustee;

 

(ii)                                  the
rights, powers, duties and obligations hereby conferred or imposed upon the
Indenture Trustee shall be conferred or imposed upon and exercised or performed
by the Indenture Trustee or by the Indenture Trustee and such co-trustee
jointly, as shall be provided in the instrument appointing such co-trustee,
except to the extent that, under any law of any jurisdiction in which any
particular act is to be performed, the Indenture Trustee shall be incompetent
or unqualified to perform such act, in which event such rights, powers, duties
and obligations shall be exercised and performed by such co-trustee;

 

64

 

(iii)                               the
Indenture Trustee at any time, by an instrument in writing executed by it, with
the concurrence of the Trust evidenced by a Trust Request, may accept the
resignation of or remove any co-trustee appointed under this Section, and, in
case an Event of Default has occurred and is continuing, the Indenture Trustee
shall have power to accept the resignation of, or remove, any such co-trustee
without the concurrence of the Trust. Upon the written request of the Indenture
Trustee, the Trust shall join with the Indenture Trustee in the execution, delivery
and performance of all instruments and agreements necessary or proper to
effectuate such resignation or removal. A successor to any co-trustee so
resigned or removed may be appointed in the manner provided in this Section;

 

(iv)                              no
co-trustee hereunder shall be personally liable by reason of any act or
omission of the Indenture Trustee or any other such trustee hereunder and the
Indenture Trustee shall not be personally liable by reason of any act or
omission of any co-trustee hereunder; and

 

(v)                                 any
Act of Holders delivered to the Indenture Trustee shall be deemed to have been
delivered to each such co-trustee.

 

SECTION 7.16. 
Appointment and Duties of the
Calculation Agent.

 

(a)                                  Unless
the Paying Agent advises the Trust that it is unable to act as Calculation
Agent, the Trust appoints the Paying Agent at its specified office as
Calculation Agent in relation to the Notes in respect of which it is named as
such in the relevant Pricing Supplement for the purposes specified in this
Indenture and all matters incidental thereto.

 

(b)                                 The
Paying Agent accepts its appointment as Calculation Agent in relation to the
Notes in respect of which it is named as such in the relevant Pricing
Supplement and shall perform all matters expressly to be performed by it in,
and otherwise comply with, the terms and conditions of the Notes and the
provisions of this Indenture and, in connection therewith, shall take all such
action as may be incidental thereto. 
The Paying Agent acknowledges and agrees that it shall be named in the
relevant Pricing Supplement as Calculation Agent in respect of the Notes unless
the purchasing agents or selling agents (or one of the purchasing agents or
selling agents) through whom the Notes are issued has agreed with the Trust to
act as Calculation Agent (in which case the purchasing agents or selling agents
shall be named as Calculation Agent in the related Pricing Supplement).  If the Calculation Agent is incapable or
unwilling to perform its duties hereunder, the Indenture Trustee (or the Administrator
if the Indenture Trustee is the Calculation Agent) will appoint the Paying
Agent or another leading commercial bank to serve as Calculation Agent.  Any resignation by or termination of a
Calculation Agent shall not be effective until a successor Calculation Agent
has been appointed.

 

(c)                                  The
Calculation Agent shall in respect of the Notes:

 

(i)                                     obtain
such quotes and rates and/or make such determinations, calculations and
adjustments as may be required under the Notes and provide notice of any applicable
interest rate calculations or determinations or periods with respect to the
Notes to the Holders of the Notes upon their request

 

65

 

and to the
Indenture Trustee, Paying Agent, the Trust and Protective Life, and if the
Notes are listed on a stock exchange, and the rules of such exchange so
require, such exchange as soon as possible after the Calculation Agent’s
determination or calculation of such interest rates or interest rate periods,
but in no event later than the fourth (4th) Banking Day thereafter
or, earlier in the case of notification to a stock exchange, if the rules of
such exchange so require; and

 

(ii)                                  maintain
a record of all quotations obtained by it and of all amounts, rates and other items
determined or calculated by it and make such record available for inspection at
all reasonable times by the Trust, the Indenture Trustee, Protective Life and
the Paying Agent.

 

(d)                                 The
Calculation Agent shall have no liability to the Holders of Notes in respect of
any determination, calculation, quote or rate made or provided by the
Calculation Agent.

 

SECTION 7.17. 
Changes in Agents

 

(a)                                  Any
Agent may resign its appointment hereunder upon the expiration of not less than
thirty (30) days’ notice to that effect to the Trust (with a copy to the
Indenture Trustee); provided, however, that any such notice which would
otherwise expire within thirty (30) days before or after the Maturity Date or
any interest or other payment date of the Notes shall be deemed to expire on
the thirtieth (30th) day following the Maturity Date or, as the case
may be, such interest or other payment date.

 

(b)                                 The
Trust may revoke its appointment of any Agent hereunder not less than thirty
(30) days’ notice to the applicable Agent and the Indenture Trustee to that
effect.

 

(c)                                  The
appointment of any Agent hereunder shall terminate forthwith if any of the
following events or circumstances shall occur or arise, namely, such Agent
becomes incapable of acting; is adjudged bankrupt or insolvent; files a
voluntary petition in bankruptcy or makes an assignment for the benefit of its
creditors or consents to the appointment of a receiver, administrator or other
similar official of all or any substantial part of its property or admits in writing
its inability to pay or meet its debts as they mature or suspends payment
thereof; a resolution is passed or an order is made for the winding-up or
dissolution of such Agent; a receiver, administrator or other similar official
of such Agent or of all or any substantial part of its property is appointed;
an order of any court is entered approving any petition filed by or against
such Agent under the provisions of any applicable bankruptcy or insolvency law;
or any public officer takes charge or control of such Agent or of its property
or affairs for the purpose of rehabilitation, conservation or liquidation.

 

(d)                                 The
Trust may (and shall where necessary to comply with the terms and conditions of
the Notes) appoint substitute or additional agents in relation to the Notes and
shall forthwith notify the other parties hereto thereof, whereupon the parties
hereto and such substitute or additional agents shall thereafter have the same
rights and obligations among them as would have been the case had they then entered
into an agreement in the form mutatis mutandis of this Indenture.

 

66

 

(e)                                  If
any Agent gives notice of its resignation in accordance with this Section
7.17, the provisions of paragraph (d) of Section 7.17 apply and by
the tenth (10th) day before the expiration of such notice a
successor to such Agent in relation to such Notes has not been appointed by the
Trust, such Agent may itself, following such consultation with the Trust as may
be practicable in the circumstances, appoint as its successor any reputable and
experienced bank or financial institution (which will ensure compliance with
the terms and conditions of the Notes) and give notice of such appointment in
accordance with the terms and conditions of the Notes, whereupon the parties
hereto and such successor agent shall thereafter have the same rights and
obligations among them as would have been the case had they then entered into
an agreement in the form mutatis mutandis of this Indenture.

 

(f)                                    Upon
any resignation or revocation becoming effective under this Section, the
relevant Agent shall:

 

(i)                                     be
released and discharged from its obligations under this Indenture;

 

(ii)                                  repay,
in accordance with the Expense and Indemnity Agreement, to Protective Life such
part of any fee paid to it as may be agreed between the relevant Agent and
Protective Life;

 

(iii)                               in
the case of the Paying Agent, deliver to the Trust and to the successor Paying
Agent a copy, certified as true and up-to-date by an officer of the Paying
Agent, of the records maintained by it in accordance with Section 3.04;

 

(iv)                              in
the case of the Registrar, deliver to the Trust and to the successor Registrar
a copy, certified as true and up-to-date by an officer of such Registrar, of
each of the Registers and other records maintained by it in accordance with Section
2.06;

 

(v)                                 in
the case of a Calculation Agent, deliver to the Trust and to the successor
Calculation Agent a copy, certified as true and up-to-date by an officer of
such Calculation Agent of the records maintained by it in accordance with Section
7.16; and

 

(vi)                              upon
payment to it by Protective Life of all amounts owed to it, forthwith transfer
all moneys and papers (including any unissued Global Notes or Definitive Notes)
held by it hereunder to its successor in that capacity and, upon appropriate
notice, provide reasonable assistance to such successor for the discharge by it
of its duties and responsibilities hereunder.

 

(g)                                 Any
corporation into which any Agent may be merged or converted, any corporation
with which any Agent may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which any Agent shall be a party or any
corporation succeeding to all or substantially all the corporate agency business
of such Agent, shall, to the extent permitted by applicable law, be the
successor to such Agent hereunder and in relation to the Notes without any
further formality, whereupon the parties hereto and such successor agent

 

67

 

shall thereafter have the same
rights and obligations among them as would have been the case had they then
entered into an agreement in the form mutatis mutandis of this Indenture.  Notice of any such merger, conversion,
consolidation or asset transfer shall forthwith be given by such successor to
the Trust and the other parties hereto.

 

(h)                                 If
any Agent decides to change its specified office (which may only be effected
within the same city) it shall give notice to the Trust (with a copy to the
Indenture Trustee) of the address of the new specified office stating the date
on which such change is to take effect, which date shall be not less than
thirty (30) days after the date of such notice.  The relevant Agent shall at its own expense not less than
fourteen (14) days prior to the date on which such change is to take effect
(unless the appointment of the relevant Agent is to terminate pursuant to any
of the foregoing provisions of this Section on or prior to the date of such
change) publish or cause to be published notice thereof.

 

Upon the execution hereof and
thereafter forthwith upon any change of the same, the Trust shall deliver to
the Indenture Trustee (with a copy to the Paying Agent) a list of the
Authorized Signatories of the Trust together with certified specimen signatures
of the same.

 

SECTION 7.18. 
Limitation of Wilmington
Liability.  It is expressly
understood and agreed by the parties that (a) this Indenture is executed and
delivered by Wilmington Trust Company, not individually or personally, but
solely as trustee of the Trust, in the exercise of the powers and authority
conferred and vested in it, pursuant to the Trust Agreement, (b) each of the
representations, undertakings and agreements herein made on the part of the
Trust is made and intended not as personal representations, undertakings and
agreements by Wilmington Trust Company, but is made and intended for the
purpose of binding only the Trust, (c) nothing contained herein shall be
construed as creating any liability on Wilmington Trust Company, individually
or personally, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties
hereto and by any person claiming by, through or under the parties hereto, and
(d) under no circumstances shall Wilmington Trust Company, be personally liable
for the payment of any indebtedness or expenses of the Trust or be liable for
the breach or failure of any obligation, representation, warranty or covenant
made or undertaken by the Trust under this Indenture or any other related
documents.

 

ARTICLE 8

Supplemental Indentures

 

SECTION 8.01. 
Supplemental Indentures Without
Consent of Holders.  Without
notice to, or the consent of, any Holder, the Trust and the Indenture Trustee,
at any time and from time to time, may enter into one or more indentures
supplemental hereto, in form satisfactory to the Indenture Trustee, for the
purpose of:

 

(a)                                  conveying,
transferring, assigning, mortgaging or pledging to the Indenture Trustee, as
security for the Notes, any property or assets in addition to the Collateral;

 

(b)                                 curing
any ambiguity or correcting or supplementing any provision contained herein, in
the Notes or in any supplemental agreement which may be defective or
inconsistent with any other provision contained in this Indenture, the Notes,
the Funding

 

68

 

Agreement or any other Program
Documents, or making such other provisions in regard to matters or questions arising
under this Indenture which shall not adversely affect the interests of any
Holder of the Notes in any material respect;

 

(c)                                  evidencing
and providing for the acceptance of appointment under this Indenture of a
successor Indenture Trustee and to add or to change any of the provisions of
this Indenture as shall be necessary to provide for or facilitate the
administration of the Trust or of the Notes under this Indenture by more than
one Indenture Trustee;

 

(d)                                 adding
to the covenants of the Trust or the Indenture Trustee for the benefit of the
Holders of the Notes or to surrender any right or power conferred in this
Indenture on the Trust;

 

(e)                                  adding
any additional Events of Default;

 

(f)                                    changing,
eliminating or supplementing any of the provisions of this Indenture; provided, however, that any such change,
elimination or supplementation shall become effective only when there is no
Note Outstanding created prior to the execution of such supplemental indenture
which is entitled to the benefit of or bound by such provision;

 

(g)                                 securing
all of the Notes;

 

(h)                                 to
provide for the issuance of and establish the form and terms and conditions of
Notes as provided in Section 2.02; or

 

(i)                                     to
establish the form of any certifications required to be furnished pursuant to
the terms of this Indenture or of the Notes.

 

Notwithstanding
any other provision, the Trust will not enter into any supplemental indenture
with the Indenture Trustee or permit this Indenture to be amended or modified
if such supplemental indenture, amendment or modification would cause any Trust
not to be treated as a grantor trust for United States federal income tax
purposes.

 

The Indenture
Trustee shall be entitled to receive and rely on an Opinion of Counsel as to
whether any such supplemental indenture complies with the requirements of Section
8.01(a) or (b), if applicable, and any such opinion shall be
conclusive on the Holders.

 

SECTION 8.02. 
Supplemental Indenture With Consent
of Holders.

 

(a)                                  With
the consent of the Holders of Notes representing at least a majority in
aggregate principal amount of all Outstanding Notes affected by such
supplemental indenture, by Act of said Holders delivered to the Trust and the
Indenture Trustee, the Trust and the Indenture Trustee may enter one or more 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
modifying in any manner the rights of the Holders of the Notes under this
Indenture; provided, however, that
no such supplemental indenture shall, without the consent of the Holder of each
Note affected thereby:

 

69

 

(i)                                     change
the Stated Maturity Date of the principal of, or the time of payment of interest
on, any Note;

 

(ii)                                  reduce
the principal amount of, the interest on or any premium payable on, any Note;

 

(iii)                               change
any Place of Payment where, or the coin or currency in which the principal of,
premium, if any, or interest on, any Note is payable;

 

(iv)                              impair
or affect the right of any Holder to institute suit for the enforcement of any
payment on or with respect to the Notes;

 

(v)                                 reduce
the percentage of the aggregate principal amount of the Outstanding Notes, the
consent of the Holders of which is required for any such supplemental
indenture, or the consent of the Holders of which is required for any waiver of
compliance with provisions of this Indenture or defaults thereunder and their
consequences provided for in this Indenture;

 

(vi)                              modify
any of the provisions of this Section or similar provisions, except to increase
any percentage specified therein or to provide that certain other provisions of
this Indenture cannot be modified or waived without the consent of the Holder
of each Outstanding Note affected thereby;

 

(vii)                           modify
or alter the provisions of the proviso to the definition of the term
“Outstanding”;

 

(viii)                        modify
or affect in any manner adverse to the interest of any Holder the terms and
conditions of the obligations of the Trust regarding the due and punctual
payment of the principal of or interest on, or any other amounts due with
respect to, the Notes; or

 

(ix)                                permit
the creation of any Lien ranking prior to or on a parity with the Lien of this
Indenture with respect to any part of any Collateral or terminate the Lien of
this Indenture on any property held for the benefit and security of Holders at
any time subject hereto or deprive any Holder of the security afforded by the
Lien of this Indenture.

 

(b)                                 The
Indenture Trustee may in its discretion determine whether or not any Notes
would be affected by any supplemental indenture (and may receive and
conclusively rely upon an Opinion of Counsel in doing so) and any such
determination shall be conclusive upon all the Holders, whether theretofore or
thereafter authenticated and delivered hereunder. The Indenture Trustee shall
not be liable for any such determination made in good faith. It shall not be
necessary for any Act of Holders under this Section to approve the particular
form of any proposed supplemental indenture, but it shall be sufficient if such
Act shall approve the substance thereof. Promptly after the execution by the
Trust and the Indenture Trustee of any supplemental indenture pursuant to this
Section, the Indenture Trustee shall mail to the Holders of the Notes a notice
setting forth in general terms the substance of such supplemental indenture.

 

70

 

Any failure of the Trust to
mail such notice, or any defect therein, shall not, however, in any way impair
or affect the validity of any such supplemental indenture.

 

(c)                                  Notwithstanding
any other provision, the Trust will not enter into any supplemental indenture
with the Indenture Trustee or permit this Indenture to be amended or modified
if such supplemental indenture, amendment or modification would cause the Trust
not to be treated as a grantor trust for United States federal income tax
purposes.

 

SECTION 8.03. 
Execution of Supplemental
Indentures.  In executing, or
accepting the additional trusts created by, any supplemental indenture
permitted by this Article or the modifications thereby of the trusts created by
this Indenture, the Indenture Trustee shall be entitled to receive, and
(subject to Section 7.01) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Indenture Trustee may, but shall
not be obligated to, enter into any such supplemental indenture that affects
the Indenture Trustee’s own rights, duties, indemnities or immunities under
this Indenture or otherwise.

 

SECTION 8.04. 
Effect of Supplemental
Indenture.  Upon the
execution of any supplemental indenture under this Article, this Indenture shall
be modified in accordance therewith, and such supplemental indenture shall form
a part of this Indenture for all purposes; and every Holder of a Note which has
theretofore been or thereafter authenticated and delivered hereunder shall be
bound thereby.  Further, the Trust shall
be bound by any such supplemental indenture.

 

SECTION 8.05. 
Reference in Notes to Supplemental
Indentures.  Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Trust shall so determine,
new Notes so modified as to conform, in the opinion of the Indenture Trustee
and the Trust, to any such supplemental indenture may be prepared and executed
by the Trust and authenticated by the Indenture Trustee and delivered by the
Indenture Trustee in exchange for Outstanding Notes.

 

SECTION 8.06. 
Conformity with Trust Indenture
Act.  Every supplemental
indenture executed pursuant to this Article shall conform to the requirements
of the Trust Indenture Act as then in effect.

 

ARTICLE 9

Non-Recourse Provisions

 

SECTION 9.01. 
Nonrecourse Enforcement.  Notwithstanding anything to the
contrary contained in this Indenture or any Notes, none of Protective Life, its
officers, directors, Affiliates, employees or agents, or the Trust or any of
Wilmington, the Trust Beneficial Owner, the Agents or any of their respective officers,
directors, Affiliates, employees or agents (the “Nonrecourse Parties”)  will
be personally liable for the payment of any principal, interest or any other
sums at any time owing under the terms of the Notes. If any Event of Default
shall occur with respect to the Notes, the right of the Holders of the Notes
and the Indenture Trustee

 

71

 

on behalf of such Holders in
connection with a claim on such Notes shall be limited solely to a proceeding
against the Collateral.  Neither such
Holders nor the Indenture Trustee on behalf of such Holders will have the right
to proceed against the Nonrecourse Parties or the Collateral held in any other
trust organized under the Program or otherwise, to enforce the Notes (except
that to the extent they exercise their rights, if any, to seize the Funding
Agreement, they may enforce the Funding Agreement against Protective Life, its
successors or assigns) or for any deficiency judgment remaining after
foreclosure of any property included in the Collateral.

 

It is
expressly understood and agreed that nothing contained in this Section 9.01
shall in any manner or way constitute or be deemed a release of the debt or
other obligations evidenced by the Notes or otherwise affect or impair the
enforceability against the Trust of the liens, assignments, rights and security
interests created by this Indenture, the Collateral or any other instrument or
agreement evidencing, securing or relating to the indebtedness or the
obligations evidenced by the Notes. Nothing in this Section 9.01 shall
preclude the Holders from foreclosing upon any property included in the
Collateral.

 

Holders may
not seek to enforce rights against the Trust (a) by commencing any recovery or
enforcement proceedings against the Trust, (b) by applying to wind up the
Trust, (c) otherwise than through the Indenture Trustee in its exercise of
powers to petition a court to appoint a receiver or administrator to the Trust
or for the Collateral, (d) by making any statutory demand upon the Trust under
applicable corporation law, or (e) in any other manner except as may be
provided in this Indenture or in the Notes.

 

ARTICLE 10

Meetings of Holders of Notes

 

SECTION 10.01.  Purposes for Which Meetings
May be Called.  A meeting of
Holders of Notes may be called at any time and from time to time pursuant to
this Article to make, give or take any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture
to be made, given or taken by the Holders of Notes.

 

SECTION 10.02.  Call, Notice and Place of
Meetings.  (a)  Unless otherwise provided in the Notes, the
Indenture Trustee may at any time call a meeting of Holders of the Notes for
any purpose specified in Section 10.01, to be held at such time and at
such place in The City of New York or such other place as the Indenture Trustee
shall determine. Notice of every meeting of Holders, 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 given, in the manner provided in Section 1.06,
not less than twenty-one (21) nor more than 180 days prior to the date fixed
for the meeting.

 

(b)                                 In
case at any time the Trust or the Holders of at least ten percent (10%) in principal
amount of the Outstanding Notes shall have requested the Indenture Trustee to
call a meeting of Holders for any purpose specified in Section 10.01, by
written request setting forth in reasonable detail the action proposed to be
taken at the meeting, and the Indenture Trustee shall not have made the first
publication or mailing of the notice of such meeting within twenty-one (21)
days after receipt of such request or shall not thereafter proceed to cause the
meeting to be held as provided herein, then the Trust or the Holders of Notes
in the amount above specified, as the case may be, may determine the time and
the place in The City of New York and may call

 

72

 

such meeting for such purposes
by giving notice thereof as provided in paragraph (a) of this Section.

 

SECTION 10.03.  Persons Entitled to Vote at
Meetings.  To  be entitled to vote at any meeting of
Holders, a Person shall be (a) a Holder of one or more Outstanding Notes; or
(b) a Person appointed by an instrument in writing as proxy for a Holder or
Holders of one or more Outstanding Notes by such Holder or Holders. The only
Persons who shall be entitled to be present or to speak at any meeting of
Holders shall be the Persons entitled to vote at such meeting and their
counsel, any representatives of the Indenture Trustee and its counsel and any
representatives of the Trust and its counsel.

 

SECTION 10.04.  Quorum; Action.  The Persons entitled to vote a
majority in principal amount of the Outstanding Notes shall constitute a quorum
for a meeting of Holders; provided, however,
that if any action is to be taken at such meeting with respect to a consent or
waiver which this Indenture expressly provides may be given by the Holders of
not less than a majority  in
principal amount of the Outstanding Notes, the Persons entitled to vote a
majority  in principal amount of
the Outstanding Notes shall constitute a quorum. In the absence of a quorum
within thirty (30) minutes after the time appointed for any such meeting, the
meeting shall, if convened at the request of Holders, be dissolved. In any
other case the meeting may be adjourned for a period of not less than ten (10)
days as determined by the 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 ten
(10) days as determined by the 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 10.02(a), except that such notice
need be given only once not less than five (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 Outstanding Notes which shall constitute a quorum.

 

Except as
limited by Section 8.02(a) and Section 6.02, any resolution
presented to a meeting or adjourned meeting duly reconvened at which a quorum
is present as aforesaid may be adopted only by the affirmative vote of the
Holders of a majority in principal amount of the Outstanding Notes; provided, however, that, except as limited
by Section 8.02(a) and Section 6.02, any resolution with respect
to any consent or waiver which this Indenture expressly provides may be given
by the Holders of not less than a majority in principal amount of the
Outstanding Notes may be adopted at a meeting or an adjourned meeting duly
convened and at which a quorum is present as aforesaid only by the affirmative
vote of the Holders of not less than a majority in principal amount of the
Outstanding Notes; and provided, further, that,
except as limited by Section 8.02(a) and Section 6.02, any
resolution with respect to any request, demand, authorization, direction,
notice, consent, waiver or other action which this Indenture expressly provides
may be made, given or taken by the Holders of a specified percentage, which is
less than a majority, in principal amount of the Outstanding Notes may be
adopted at a meeting or an adjourned meeting duly reconvened and at which a
quorum is present as aforesaid by the affirmative vote of the Holders of such
specified percentage in principal amount of the Outstanding Notes.

 

73

 

Notwithstanding
the preceding two paragraphs, any request, demand, authorization, direction,
notice, consent, waiver or other action of Holders under this Indenture or the
Notes may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent
duly appointed in writing; and, except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Indenture Trustee and, when it is expressly required, to the
Trust. The percentage of principal amount of the Outstanding Notes held by the
Holders delivering such instruments which is required to approve any such
action shall be the same as the percentage required for approval at a duly
convened meeting of Holders.

 

Any resolution
passed or decision taken at any meeting of Holders duly held or by duly
executed instrument in accordance with this Section shall be binding on all
Holders of the Notes, whether or not such Holders were present or represented
at the meeting.

 

SECTION 10.05.  Determination of Voting
Rights; Conduct and Adjournment of Meetings.

 

(a)                                  Notwithstanding
any other provisions of this Indenture, the Indenture Trustee may make such
reasonable regulations as it may deem advisable for any meeting of Holders in
regard to proof of the holding of Notes 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
deem appropriate. Except as otherwise permitted or required by any such
regulations, the holding of Notes shall be proved in the manner specified in Section
1.04 and the appointment of any proxy shall be proved in the manner
specified in Section 1.04. Such regulations may provide that written
instruments appointing proxies, regular on their face, may be presumed valid
and genuine without the proof specified in Section 1.04 or other proof.

 

(b)                                 The
Indenture Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the Trust
or by Holders as provided in Section 10.02(b), in which case the Trust
or the Holders 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 vote of the Persons entitled to vote a majority
in principal amount of the Outstanding Notes represented at the meeting.

 

(c)                                  At
any meeting, each Holder or proxy shall be entitled to one vote for each $1,000
of principal amount of Notes held or represented by him, her or it; provided, however, that no vote shall be
cast or counted at any meeting in respect of any Note 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, except as a Holder or
proxy.

 

(d)                                 Notwithstanding
any other provision herein to the contrary, any meeting of Holders duly called
pursuant to Section 10.02 at which a quorum is present may be adjourned from
time to time by Persons entitled to vote a majority in principal amount of the
Outstanding

 

74

 

Notes represented at the
meeting; and the meeting may be held as so adjourned without further notice.

 

SECTION 10.06.  Counting Votes and Recording
Action of Meetings.  The vote
upon any resolution submitted to any meeting of Holders shall be by written
ballots on which shall be subscribed the signatures of the Holders or of their
representatives by proxy and the principal amounts and serial numbers of the
Outstanding Notes 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, at least in triplicate, of the proceedings
of each meeting of Holders 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 given as provided in Section
10.02 and, if applicable, Section 10.04. Each copy shall be signed
and verified by the affidavits of the permanent chairman and secretary of the
meeting and one such copy shall be delivered to the Trust, and another to the
Indenture Trustee to be preserved by the Indenture 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.

 

ARTICLE 11

Notes in Foreign Currencies

 

SECTION 11.01.  Notes in Foreign
Currencies.  In the absence
of any provision to the contrary in the form of Notes, whenever this Indenture
provides for (a) any action by, or the determination of any of the rights of,
the Holders of Notes if not all of the Notes are denominated in the same
currency, or (b) any distribution to the Holders of Notes of any amount in
respect of any Note denominated in a currency other than Dollars, then all
foreign denominated Notes shall be treated for any such action, determination
of rights or distribution as that amount of Dollars that could be obtained for
such amount on such reasonable basis of exchange and as of the Regular Record
Date with respect to such Notes for such action, determination of rights or
distribution (or, if there shall be no applicable Regular Record Date, such
other date reasonably proximate to the date of such action, determination of
rights or distribution) as the Trust may specify in a written notice to the
Indenture Trustee or, in the absence of such written notice, as the Indenture
Trustee may determine.

 

75

 

EXHIBIT A-1

FORM OF RETAIL GLOBAL NOTE

 

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

 

Unless
this certificate is presented by an authorized representative of The Depository
Trust Company, a New York corporation (“DTC”), to the trust or its agent for
registration of transfer, exchange or payment, and unless any certificate
issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.

 

PROTECTIVE
LIFE SECURED TRUST
[       ]-[     ]

INTERNOTE®

 

	
  REGISTERED
  NUMBER:

  	
   

  	
  CUSIP

  
	
   

  
	
  ORIGINAL
  ISSUE DATE:

  	
   

  	
   

  	
  PRINCIPAL
  AMOUNT:  $

  	
   

  
	
   

  
	
  INTEREST
  RATE:

  	
   

  	
  %

  	
   

  	
  STATED
  MATURITY DATE:

  	
   

  
	
   

  
	
  ISSUE
  PRICE (as a percentage of the Principal Amount):

  	
   

  	
  INTEREST
  PAYMENT FREQUENCY (check applicable):

  
	
   

  	
   

  	
  o Monthly

  	
   

  	
  o Quarterly

  
	
   

  	
  %

  	
   

  	
  o Semi-annual

  	
   

  	
  o Annual

  
	
   

  
	
  Collateral Held in the Trust:  Protective Life Insurance Company Funding

  Agreement No. •, all proceeds, rights and books and records related

  thereto.

  
	
   

  
	
  Specified
  Currency:  U.S. Dollars

  
														

 

 

REPAYMENT
RIGHT:  o  Yes    o  No   (If yes, the
Holder of this Note has the right to the repayment of this Note on any 

	
  Interest
  Payment Date after

  	
   

  	
  )

  

 

REDEMPTION
RIGHT:  o  Yes    o  No   (If yes, the
Trust will redeem this Note on the date and to the extent that the Funding
Agreement (as defined in the Indenture) has been redeemed by Protective Life
Insurance Company (“Protective Life”). 
Protective Life has the right to redeem the Funding Agreement, in full
or in part, on any date after                    
(such date, the “Initial Redemption Date”))

 

	
   

  	
  [INITIAL REDEMPTION

  PERCENTAGE:

                                           ]

  	
   

  	
  [ANNUAL
  REDEMPTION

  PERCENTAGE REDUCTION:

                                              ]

  

 

 

SURVIVOR’S
OPTION:  o  Yes    No  o   (If yes, the attached
Survivor’s Option Rider is incorporated into this Note)

 

Trust
Put Limitation:                                       

 

MINIMUM
DENOMINATIONS:   $                              (if
other than $1,000)

 

SECURITIES
EXCHANGE LISTING:  o  Yes    o  No  (If yes, indicate
name of securities exchange

 

                                      )

 

A-1-2

 

The Protective Life Secured Trust designated
above, a trust formed under the laws of the State of Delaware (the “Trust”),
for value received, hereby promises to pay to Cede & Co., or its registered
assigns, the Principal Amount on the Stated Maturity Date, and to pay interest
thereon, until the Principal Amount is paid or duly provided for, from and
including the Original Issue Date or, in the case of a Note issued upon
registration of transfer or exchange, from and including the most recent
Interest Payment Date to which interest has been paid or duly provided for, on
each Interest Payment Date and the Maturity Date determined as follows:  the Interest Payment Dates for a Note that
provides for monthly interest payments shall be the fifteenth day of each
calendar month, beginning in the first calendar month following the month in
which the Note was issued; in the case of a Note that provides for quarterly
interest payments, the Interest Payment Dates shall be the fifteenth day of
every third calendar month, beginning in the third calendar month following the
month in which the Note was issued; in the case of a Note that provides for
semi-annual interest payments, the Interest Payment Dates shall be the
fifteenth day of every sixth calendar month, beginning in the sixth calendar
month following the month in which the Note was issued; and in the case of a
Note that provides for annual interest payments, the Interest Payment Date
shall be the fifteenth day of every twelfth calendar month, beginning in the
twelfth calendar month following the month in which the Note was issued.  Interest will be computed on the basis of a
360-day year of twelve 30-day months. 
The first payment of interest for a Note will be made on the first
Interest Payment Date following the Original Issue Date of such Note.

 

Interest payments will be in the amount of
interest accrued from, and including, the next preceding Interest Payment Date
in respect of which interest has been paid or duly provided for or, if no
interest has been paid or duly provided for, from the Original Issue Date
specified above, to, but excluding, the Interest Payment Date or Maturity Date,
as the case may be.  If the Maturity
Date or an Interest Payment Date falls on a day which is not a Business Day,
principal or interest payable with respect to such Maturity Date or Interest
Payment Date will be paid on the next succeeding Business Day with the same
force and effect as if made on such Maturity Date or Interest Payment Date, as
the case may be, and no additional interest shall accrue for the period from
and after such Maturity Date or Interest Payment Date.  The interest 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 (as defined in the Indenture) in whose name
this Note (or one or more predecessor Notes) is registered at the close of
business on the Regular Record Date for such Interest Payment Date, which
Regular Record Date shall be the fifteenth calendar day, whether or not a
Business Day, immediately preceding the related Interest Payment Date; provided, however, that interest payable
on any Maturity Date shall be payable to the Person to whom principal is
payable.  Any such interest not so
punctually paid or duly provided for shall be payable as provided in the
Indenture.  As used herein, the term
“Business Day” means any day, other than a Saturday or Sunday, that is neither
a legal holiday nor a day on which commercial banks are authorized or required
by law, regulation or executive order to close in The City of New York.

 

The principal of and interest on this Note
are payable in immediately available funds in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts at the corporate trust office of the Paying Agent
(as defined in the Indenture).  The
Paying Agent shall pay principal, interest and other amounts due on this Note
to Cede & Co., as nominee for DTC, in accordance with existing arrangements
between the Paying Agent and the Depositary.

 

A-1-3

 

REFERENCE IS MADE TO THE FURTHER PROVISIONS
OF THIS NOTE SET FORTH ON THE REVERSE HEREOF, WHICH SHALL HAVE THE SAME EFFECT
AS THOUGH FULLY SET FORTH AT THIS PLACE.

 

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

 

IN WITNESS WHEREOF, the Trust, has caused
this Instrument to be duly executed, by manual or facsimile signature.

 

 

	
   

  	
  THE PROTECTIVE LIFE SECURED TRUST

  SPECIFIED ON THE FACE OF THIS NOTE

  
	
   

  
	
   

  
	
   

  	
  By:  Wilmington Trust Company,
  not in its individual

  capacity but solely as Delaware Trustee.

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						

 

A-1-4

 

CERTIFICATE OF AUTHENTICATION

 

This is one of the Notes of the Protective
Life Secured Trust specified on the face of this Note referred to in the
within-mentioned Indenture.

 

	
  Dated: Original Issue Date

  
	
   

  
	
   

  
	
   

  	
  The Bank of New York,

  as Indenture Trustee

  
	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Officer

  	
   

  

 

A-1-5

 

[Reverse of Note]

 

This Note is one of a duly authorized issue of Notes of the Protective
Life Secured Trust designated above (the “Trust”), issued under the Indenture,
dated the Original Issue Date specified in the Pricing Supplement (the
“Indenture”), between The Bank of New York (the “Indenture Trustee”) and the
Trust.  Capitalized terms used and not
otherwise defined herein shall have the meanings assigned to them in the
Indenture.

 

This Note is not subject to any sinking fund.

 

IF NO REPAYMENT RIGHT IS SET FORTH ON THE FACE HEREOF, THIS NOTE MAY
NOT BE REPAID AT THE OPTION OF THE HOLDER HEREOF PRIOR TO THE STATED MATURITY DATE.  If a Repayment Right is granted on the face
of this Note, this Note may be subject to repayment at the option of the Holder
on any Interest Payment Date on and after the date, if any, indicated on the
face hereof (each, a “Repayment Date”). 
On any Repayment Date, unless otherwise specified on the face hereof,
this Note shall be repayable in whole or in part in increments of $1,000 at the
option of the Holder hereof at a repayment price equal to 100% of the Principal
Amount to be repaid, together with interest thereon payable to the date of
repayment.  For this Note to be repaid
in whole or in part at the option of the Holder hereof, this Note must be
received by the Indenture Trustee, with the form entitled “Option to Elect
Repayment,” below, duly completed. 
Exercise of such repayment option by the Holder hereof shall be
irrevocable.

 

IF NO REDEMPTION RIGHT IS SET FORTH ON THE FACE HEREOF, THIS NOTE MAY
NOT BE REDEEMED PRIOR TO THE STATED MATURITY DATE, EXCEPT AS SET FORTH IN THE
INDENTURE.  If a Redemption Right is set
forth on the face of this Note, the Trust shall elect to redeem this Note on
the Interest Payment Date after the Initial Redemption Date set forth on the
face hereof on which the Funding Agreement is to be redeemed in whole or in part
by Protective Life Insurance Company (“Protective Life”) (each, a “Redemption
Date”), in which case this Note must be redeemed on such Redemption Date in
whole or in part, as applicable, in increments of $1,000 at the applicable
Redemption Price (as defined below), together with unpaid interest accrued
thereon to the applicable Redemption Date. 
“Redemption Price” shall mean an amount equal to the Initial Redemption
Percentage (as adjusted by the Annual Redemption Percentage Reduction, if
applicable) multiplied by the unpaid Principal Amount of this Note to be
redeemed.  The unpaid Principal Amount
of this Note to be redeemed shall be determined by multiplying (1) the
Outstanding Principal Amount of this Note by (2) the quotient derived by
dividing (A) the outstanding principal amount of the Funding Agreement to be
redeemed by Protective Life, by (B) the outstanding principal amount of the
Funding Agreement.  The Initial
Redemption Percentage, if any, applicable to this Note shall decline at each
anniversary of the Initial Redemption Date by an amount equal to the applicable
Annual Redemption Percentage Reduction, if any, until the Redemption Price is
equal to 100% of the Principal Amount thereof to be redeemed.  Notice must be given not more than 75 nor
less than 30 calendar days prior to the proposed redemption date.  In the event of redemption of this Note in
part only, a new Note for the unredeemed portion hereof shall be issued in the
name of the Holder hereof upon the surrender hereof.  If less than all of the Notes are redeemed, the Depositary will
select by lot the amount of the interest of each direct participant in the
Trust to be redeemed.  Unless otherwise
specified herein, the Trust may not redeem the Notes after the date that is
thirty (30) days prior to the Stated Maturity Date.

 

A-1-6

 

If an Event of Default shall occur with
respect to the Notes, the principal of all the Notes may be declared due and
payable, or may be automatically accelerated, as the case may be, in the manner
and with the effect provided in the Indenture.

 

If (1) a Tax Event (defined below) as to the
Funding Agreement occurs and (2) Protective Life redeems the Funding Agreement
in whole or in part, the Trust will redeem the Notes, subject to the terms and
conditions of Section 2.04 of the Indenture, at the Tax Event Redemption
Price (defined below) together with unpaid interest accrued thereon to the
applicable redemption date.  “Tax Event”
means that Protective Life shall have received an opinion of independent legal
counsel stating in effect that as a result of (a) 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 therefor or therein or (b) any amendment to, or change in, an
interpretation or application of any such laws or regulations by any
governmental authority in the United States, which amendment or change is
enacted, promulgated, issued or announced on or after the date the Funding
Agreement is entered into, there is more than an insubstantial risk that (i)
the Trust is, or will be within 90 days of the date thereof, subject to U.S.
federal income tax with respect to interest accrued or received on the Funding
Agreement or (ii) the Trust is, or will be within 90 days of the date thereof,
subject to more than a de minimis amount of taxes, duties or other governmental
charges.  “Tax Event Redemption Price”
means an amount equal to the unpaid Principal Amount of this Note to be
redeemed.  The unpaid Principal Amount
of this Note to be redeemed shall be determined by multiplying (1) the
Outstanding Principal Amount of this Note by (2) the quotient derived by
dividing (A) the outstanding principal amount to be redeemed by Protective Life
of the Funding Agreement by (B) the outstanding principal amount of the Funding
Agreement.

 

The Indenture contains provisions permitting
the Trust and the Indenture Trustee (i) without the consent of the Holders of
any Notes issued under the Indenture to execute supplemental indentures for
certain enumerated purposes and (ii) with the consent of the Holders of not
less than a majority in aggregate Principal Amount of the Outstanding Notes
affected thereby, to execute supplemental indentures for the purpose of adding
any provisions to, or changing in any manner or eliminating any of the
provisions of the Indenture or of modifying in any manner the rights of Holders
of Notes under the Indenture; provided,
that, with respect to certain enumerated provisions, no such supplemental
indenture may be entered into without the consent of the Holder of each Note
affected thereby.  Any such consent or waiver by the Holder of this Note
shall be conclusive and binding upon such Holder and upon all future Holders of
this Note and of any Note issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Note or such other Notes.

 

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

 

No recourse shall be had for the payment of the principal of or the
interest on this Note, or for any claim based hereon, or otherwise in respect
hereof, or based on or in respect of the Indenture or any indenture supplemental
thereto, against the Nonrecourse Parties, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment
or

 

A-1-7

 

penalty or
otherwise, all such personal liability being, by the acceptance hereof and as
part of the consideration for issue hereof, expressly waived and released.

 

This Note or portion hereof may not be exchanged for Definitive Notes
except in the limited circumstances provided for in the Indenture.  The transfer or exchange of Definitive Notes
shall be subject to the terms of the Indenture.

 

This Note is issuable only as a registered
Note without coupons in denominations of $1,000 and any integral multiple in
excess thereof unless otherwise specifically agreed between the parties and
provided on the face of this Note.

 

As provided in the Indenture and subject to
certain limitations therein set forth (including, in the case of a Global Note,
certain additional limitations), the transfer of this Note is registrable in
the Register, upon surrender of this Note for registration of transfer at the
Place of Payment, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Administrator and the Registrar duly executed
by the Holder hereof or his attorney duly authorized in writing, and thereupon
one or more new Notes of like tenor, of authorized denominations and for the
same aggregate Principal Amount, will be issued to the designated transferee or
transferees.

 

As provided in the Indenture and subject to
certain limitations (including, in the case of any Global Note, certain
additional limitations) therein set forth, this Note is exchangeable for a like
aggregate Principal Amount of Notes of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.

 

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

 

Prior to due presentment for registration of
transfer of this Note, the Trust, the Indenture Trustee, the Registrar, the
Paying Agent, any Agent, and any other agent of the Trust or the Indenture
Trustee may treat the Person in whose name this Note is registered as the owner
hereof for the purpose of receiving payment as herein provided (subject to Section
2.9 of the Indenture) and for all other purposes, whether or not this Note
be overdue, and, except as otherwise required by applicable law, none of the
Trust, the Indenture Trustee, the Registrar, the Paying Agent, any Agent, and
any other agent of the Trust or the Indenture Trustee shall be affected by
notice to the contrary.

 

The Notes are being issued by means of a
book-entry-only system with no physical distribution of certificates to be made
except as provided in the Indenture. 
The book-entry system maintained by DTC will evidence ownership of the
Notes, with transfers of ownership effected on the records of DTC and its
participants pursuant to rules and procedures established by DTC and its
participants.  The Trust and the
Indenture Trustee will recognize Cede & Co., as nominee of DTC, while the
registered owner of the Notes, as the Holder of the Notes for all purposes,
including payment of principal and interest, notices and voting.  Transfer of principal and interest to
participants of DTC will be the responsibility of DTC, and transfer of
principal and interest to beneficial owners of the Notes by participants of DTC
will be the responsibility of such participants and other nominees of such
beneficial owners.  So long as the
book-entry system is in effect, the selection of any Notes to be redeemed or
repaid will be determined by

 

A-1-8

 

DTC pursuant to rules and procedures established by DTC and its
participants.  Neither the Trust nor the
Indenture Trustee will be responsible or liable for such transfers or payments
or for maintaining, supervising or reviewing the records maintained by DTC, its
participants or persons acting through such participants.

 

No Additional Amounts will be paid with
respect to any payment of principal of (or premium, if any, on) or interest, if
any, on this Note to any Holder.

 

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.

 

A-1-9

 

ASSIGNMENT

 

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

  
	
                                                                                                                                                                                    

  	
  .

  
	
   

  
	
  [PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS

  INCLUDING ZIP CODE, OF ASSIGNEE]

  
	
   

  
	
   

  	
   

  
	
                                                                                                                                                              

  	
   

  
	
                                                                                                                                                              

  	
   

  
	
   

  
	
  Please
  Insert Social Security or Other

  Identifying Number of Assignee:

  	
   

  	
   

  
	
   

  
	
  the within
  Note and all rights thereunder, hereby irrevocably constituting and
  appointing                                          
  Attorney to transfer said Note in the Register, with full power of
  substitution in the premises.

  
					

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  (Signature Guaranteed)

  
					

 

NOTICE: The signature to this assignment must correspond with the name
as it appears upon the face of the within Note in every particular, without
alteration or enlargement or any change whatever and must be guaranteed.

 

A-1-10

 

OPTION TO ELECT REPAYMENT

 

The undersigned hereby irrevocably request(s)
and instruct(s) the Trust to repay this Note (or portion hereof specified
below) pursuant to its terms at a price equal to the Principal Amount hereof
together with interest to the repayment date, to the undersigned, at:

	
   

  
	
   

  
	
   

  

 

 

(Please print or typewrite name and address of the undersigned).

 

For this Note to be repaid, the Indenture
Trustee (or the Paying Agent on behalf of the Indenture Trustee) must receive
at its Corporate Trust Office, or at such other place or places of which the
Trust shall from time to time notify the Holder of this Note, not more than 60
nor less than 30 days prior to a Repayment Date, if any, shown on the face of
this Note, this Note with this “Option to Elect Repayment” form duly completed.

 

If less than the entire Principal Amount of
this Note is to be repaid, specify the portion hereof (which shall be in
increments of $1,000) which the Holder elects to have repaid and specify the
denomination or denominations (which shall be $             
or an integral multiple of $1,000 in excess of $              )
of the Notes to be issued to the Holder for the portion of this Note not being
repaid (in the absence of any such specification, one such Note will be issued
for the portion not being repaid).

 

	
  $

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  NOTICE: The signature
  on this Option to Elect Repayment must correspond with the name as written
  upon the face of this Note in every particular, without alteration or
  enlargement or any change whatever.

  
	
  DATE:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Registered Face Amount
  to be repaid, if amount to be repaid is less than the Registered Face Amount
  of this Note (Registered Face Amount remaining must be an authorized
  denomination)

  	
   

  	
  Fill in for
  registration of Notes if to be issued otherwise than to the registered Holder:

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
  $

  	
   

  	
   

  	
  Address:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Please print name and

  address including zip code)

  
											

 

 

SOCIAL SECURITY OR OTHER TAXPAYER ID NUMBER:                                                  

 

A-1-11

 

SURVIVOR’S OPTION RIDER

 

Unless the Notes have been declared due and
payable prior to their maturity by reason of any Event of Default under the
Indenture, or have been previously redeemed or otherwise repaid, the authorized
Representative (as defined below) of a deceased Beneficial Owner (as defined
below) of that Note shall have the option to elect repayment of such Notes
following the death of the Beneficial Owner (a “Survivor’s Option”).  The Survivor’s Option may not be exercised
unless the Notes to be repaid were held by the Beneficial Owner or the estate
of that Beneficial Owner for a period beginning at least 6 months immediately
prior to such election.  “Beneficial
Owner” as used in this Survivor’s Option Rider means, with respect to a Note,
the person who has the right, immediately prior to such person’s death, to
receive the proceeds from the disposition of that Note, as well as the right to
receive payments on that Note.

 

Upon (i) the valid exercise of the Survivor’s
Option and the proper tender of the Notes for repayment by or on behalf of the
person that has authority to act on behalf of the deceased Beneficial Owner of
such Notes under the laws of the appropriate jurisdiction (including, without
limitation, the personal representative or executor of the deceased Beneficial
Owner or the surviving joint owner of the deceased Beneficial Owner) (the
“Representative”) and (ii) the tender and acceptance of that portion of the
Funding Agreement equal to the amount of the portion of the Note to be
redeemed, the Trust shall repay the Notes (or portion thereof)  at a price equal to 100% of the Principal
Amount of the deceased Beneficial Owner’s beneficial interest in such Note plus
accrued and unpaid interest to the date of such repayment.  However, the Trust shall not be obligated to
repay:

 

•      beneficial ownership interests in
Notes exceeding the greater of $2,000,000 or 2% (or such other amounts, as
specified in the Pricing Supplement) in aggregate principal amount for all
notes then outstanding under the Protective Life Secured InterNotes® program as
of the end of the most recent calendar year (the “Annual Put Limitation”);

 

•      on behalf of an individual deceased
Beneficial Owner, any beneficial ownership interest in all notes issued under
the Protective Life Secured InterNotes® program that exceeds $250,000 (or such
other amounts, as specified in the Pricing Supplement) in any calendar year
(the “Individual Put Limitation”); or

 

•      beneficial ownership interests in
Notes of the Trust exceeding the amount specified on the face hereof for the
Trust Put Limitation, if any (the “Trust Put Limitation”).

 

The Trust shall not make principal repayments
pursuant to exercise of the Survivor’s Option in amounts that are less than
$1,000, and, in the event that the limitations described in the preceding
sentence would result in the partial repayment of any Note, the Principal
Amount of such Note remaining Outstanding after repayment must be at least
$1,000 (the minimum authorized denomination of the Notes).

 

An otherwise valid election to exercise the
Survivor’s Option may not be withdrawn.

 

Each Note (or portion thereof) that is
elected for exercise of the Survivor’s Option will be accepted in the order
that elections are received by the Administrator, except for any Notes (or
portion thereof) the acceptance of which would contravene (i) the Annual Put
Limitation, (ii) the Individual Put Limitation, if applied, or (iii) the Trust
Put Limitation.  Any Note (or portion

 

A-1-12

 

thereof) accepted for repayment pursuant to exercise of the Survivor’s
Option shall be repaid on the first Interest Payment Date that occurs 20 or
more calendar days after the date of such acceptance.  If, as of the end of any calendar year, the aggregate principal
amount of all notes (or portions thereof) issued under the Protective Life
Secured InterNotes® program that have been tendered pursuant to the valid
exercise of the Survivor’s Option during such year has exceeded the Annual Put
Limitation or the Individual Put Limitation, for such year, any exercise(s) of
the Survivor’s Option with respect to Notes (or portions thereof) not accepted
during such calendar year, because such acceptance would have contravened any
such limitation, if applied, shall be deemed to be tendered in the following
calendar year in the order all such notes (or portions thereof) were originally
tendered.  In the event that a Note (or
any portion thereof) tendered for repayment pursuant to valid exercise of the
Survivor’s Option is not accepted, the Administrator shall deliver a notice by
first-class mail to the Depositary that states the reason such Note (or portion
thereof) has not been accepted for payment.

 

In order to obtain repayment through exercise
of the Survivor’s Option with respect to any Note (or portion thereof), the
Representative must provide the following items to the broker or other entity
through which the beneficial interest in the Notes is held by the deceased
Beneficial Owner: (i) a written instruction to such broker or other entity to
notify the Depositary of the Representative’s desire to obtain repayment
through the exercise of the Survivor’s Option; (ii) appropriate evidence
satisfactory to the Administrator that (A) the deceased was the Beneficial
Owner of such Notes at the time of death and the interest in such Notes was
owned by the deceased Beneficial Owner or his or her estate for a period
beginning at least six months immediately prior to the request for repayment,
(B) the death of such Beneficial Owner has occurred, and the date of such
death, and (C) the Representative has authority to act on behalf of the
deceased Beneficial Owner; (iii) if the interest in such Notes is held by a
nominee of the deceased Beneficial Owner, a certificate satisfactory to the
Administrator from such nominee attesting to the deceased’s beneficial
ownership of such Notes; (iv) a written request for repayment signed by the
Representative, with the signature guaranteed by a member firm of a registered
national securities exchange or of the National Association of Securities
Dealers, Inc.  or a commercial bank or
trust company having an office or correspondent in the United States; (v) if
applicable, a properly executed assignment or endorsement; (vi) tax waivers and
such other instruments or documents that the Administrator reasonably requires
in order to establish the validity of the beneficial ownership of the Notes and
the claimant’s entitlement to payment; and (vii) any additional information the
Administrator requires to evidence satisfaction of any conditions to the
exercise of such Survivor’s Option or to document beneficial ownership or
authority to make the election and to cause the repayment of such Notes.  Such broker or other entity shall then
deliver each of these items to the direct participant of the Depositary, such
direct participant being the entity that holds the beneficial interest in the
Notes on behalf of the deceased Beneficial Owner, together with evidence
satisfactory to the Administrator from the broker or other entity stating that
it represents the deceased Beneficial Owner. 
Such direct participant shall then deliver such items to the Indenture
Trustee.  Such direct participant shall
be responsible for disbursing any payments it receives from the Depositary pursuant
to exercise of the Survivor’s Option to the appropriate Representative.  All questions, other than with respect to
the right to limit the aggregate Principal Amount of Notes as to which
exercises of the Survivor’s Option shall be accepted in any one calendar year
or as to the Notes or as to the eligibility or validity of any exercise of the
Survivor’s Option, will be determined by the Administrator, in its sole
discretion, which determination shall be final and binding on all parties.

 

A-1-13

 

The death of a person holding a beneficial
interest in a Note as a joint tenant or tenant by the entirety with another
person, or as a tenant in common with the deceased owner’s spouse, will be
deemed the death of the Beneficial Owner of that Note, and the entire Principal
Amount of the Note so held shall be subject to repayment by the Trust upon
request.  However, the death of a person
holding a beneficial interest in a Note as tenant in common with a person other
than such deceased owner’s spouse will be deemed the death of a Beneficial
Owner only with respect to such deceased person’s ownership interest in the
Note.

 

The death of a person who, during his or her
lifetime, was entitled to substantially all of the beneficial ownership
interests in a Note will be deemed the death of the Beneficial Owner of such
Note for purposes of the Survivor’s Option, regardless of whether that
Beneficial Owner was the registered holder of the Note, if such beneficial
ownership interest can be established to the satisfaction of the
Administrator.  A beneficial ownership
interest will be deemed to exist in typical cases of nominee ownership,
ownership under the Uniform Transfers to Minors Act or Uniform Gifts to Minors
Act, community property or other joint ownership arrangements between a husband
and wife.  In addition, a beneficial
ownership interest will be deemed to exist in custodial and trust arrangements
where one person has all of the beneficial ownership interests in the Note
during his or her lifetime.

 

A-1-14

 

PROTECTIVE
LIFE SECURED

INTERNOTES®

 

FORM OF NOTICE
OF ELECTION TO EXERCISE SURVIVOR’S OPTION

 

o                                   By
checking this box, the undersigned represents that: (1) he/she is the
authorized representative of the deceased Beneficial Owner identified below;
(2) (a) the deceased was the Beneficial Owner of the principal amount of
Protective Life Secured InterNotes® listed below at the date of his or her
death and the interest in such Notes was owned by the deceased or his or her
estate for a period beginning at least six months immediately prior to this
request for repayment, (b) the death of the Beneficial Owner listed below has
occurred and (c) the undersigned representative has authority to act on behalf
of the deceased Beneficial Owner; and (3) subject to the aggregate limitations
on the amount of Protective Life Secured InterNotes® that may be tendered in
any calendar year, he/she hereby elects to tender the principal amount of Protective
Life Secured InterNotes® set forth below for repayment by the Trust for a price
equal to [100]% (or such lesser
amount as may be accepted for repayment) of the Principal Amount of the
beneficial interest of the deceased Beneficial Owner plus accrued interest to
the date of repayment.

 

The deceased Beneficial Owner held the Principal Amount of Protective
Life Secured InterNotes® to be tendered as (check one):

 

o                                    a
sole Beneficial Owner, a joint tenant or a tenant by the entirety with another
or others, a tenant in common with a spouse or an individual entitled to
substantially all of the beneficial interest.

 

o                                    a
tenant in common with another (other than a spouse).  If applicable please provide the amount of interest held by the
deceased Beneficial Owner. $                                                 

 

Full name of deceased Beneficial Owner (please attach death certificate):                                                     

 

If applicable, full name of the nominee of the deceased Beneficial Owner
(please attached a certificate attesting to
the deceased’s ownership of the beneficial interest in the notes):                                                                     

 

Principal amount of Protective Life Secured InterNotes® being tendered
for repayment (amount must be at least
$1,000):

 

                                                                     

 

The Bank of New York, as Indenture Trustee on behalf of the Trust, has
the right to reject tenders of Protective Life Secured InterNotes® if a
properly executed election is not submitted or if it fails to receive any tax
or additional information that is required to document adherence to any
conditions precedent, ownership or authority to make the election.

 

A-1-15

 

THIS NOTICE OF
ELECTION MAY NOT BE WITHDRAWN AND INTERNOTES® SUBJECT TO THIS NOTICE OF
ELECTION MAY NOT BE TRANSFERRED PRIOR TO THE DATE OF REPAYMENT

 

PLEASE SIGN HERE

 

(Must be signed by authorized
representative(s) of deceased Beneficial Owner.  If signature is by a trustee, executor, administrator, guardian,
attorney-in-fact, officer of a corporation or another person acting in a
fiduciary capacity, please set forth full title).

 

	
  Signature(s) of Authorized
  Representative(s):

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated: 

  	
   

  	
  , 20

  	
   

  	
   

  
	
   

  
	
  Name(s):

  	
   

  
	
   

  
	
   

  
	
  (Please Print)

  
	
   

  
	
  Capacity (full title):

  	
   

  
	
   

  
	
  Address:

  	
   

  
	
   

  
	
  (Include Zip Code)

  
	
   

  
	
  Area Code(s) and Telephone Number(s):

  	
   

  
	
   

  
							

GUARANTEE OF SIGNATURE(S)

 

(Must be signed by authorized representative
of: (1) a member firm of a registered national securities exchange or the
National Association of Securities Dealers, Inc., or (2) a commercial bank or
trust company having an office or correspondent in the United States.)

	
   

  
	
  Name of Firm:

  	
   

  
	
   

  
	
  Authorized Signature:

  	
   

  
	
   

  
	
  Name:

  	
   

  
	
   

  
	
  (Please Print)

  
	
   

  
	
  Title:

  	
   

  
	
   

  
	
  Address:

  	
   

  
						

 

A-1-16

 

	
  (Include Zip Code)

  
	
   

  
	
  Area Code(s) and Telephone Number(s):

  	
   

  
	
   

  
	
  Dated: 

  	
   

  	
  , 20

  	
   

  	
   

  
						

 

A-1-17

 

EXHIBIT A-2

FORM OF INSTITUTIONAL GLOBAL NOTE

 

CUSIP NO.                   

 

PROTECTIVE LIFE SECURED TRUST
[     ]-[   ]

SECURED MEDIUM-TERM NOTE

 

REGISTERED FACE AMOUNT:                 

No.                  

 

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

 

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

 

 

Principal
Amount: $                                               

 

(or
principal amount of foreign or composite currency)

 

Original
Issue Date:

 

Price
to Public:

 

Stated
Maturity Date:

 

Settlement
Date and Time:

 

Securities Exchange Listing:  o
Yes  o
No.  If yes, indicate name(s) of
Securities Exchange(s) 

 

                                                                           .

 

Depositary:

 

Authorized
Denominations:

 

Collateral held in the Trust:  Protective Life Insurance Company Funding
Agreement No. •,
all proceeds, rights and books and records related thereto.

 

Additional
Amounts to be Paid: o  Yes   o  No.

 

Interest
Rate or Formula:

 

Fixed
Rate Note: o  Yes   o  No.  If yes,

 

Interest
Rate:

 

Interest
Payment Frequency:

 

o
Monthly            o Quarterly

 

o Semi-annually  o Annually

 

Additional/Other
Terms:

 

Amortizing
Note: o Yes o
No.  If yes,

 

Amortization
schedule or formula:

 

Additional/Other
Terms:

 

Discount
Note: o Yes o
No.  If yes,

 

Registered
Face Amount:

 

Total
Amount of Discount:

 

Yield
to Maturity:

 

Additional/Other
Terms:

 

Redemption Provisions: o
Yes  o No. 
If yes,

 

Initial
Redemption Date:

 

Initial
Redemption Percentage:

 

Annual
Redemption Percentage Reduction, if any:

 

Additional/Other
Terms:

 

Repayment
Provisions: o Yes  o No. 
If yes,

 

Optional
Repayment Date(s):

 

Additional/Other
Terms:

 

Floating
Rate Note: o Yes o
No.  If yes,

 

Interest
Rate:

 

Interest
Rate Basis(es) (or Base Rate):

 

CD Rate o

 

Commercial Paper Rate o

 

Federal Funds Rate o

 

LIBOR o

 

o LIBOR Reuters Page:

 

o LIBOR Telerate Page:

 

Designated LIBOR Currency:

 

Treasury Rate (other than Constant Maturity
Treasury Rate) o

 

Constant Maturity Treasury Rate o

 

Designated CMT Telerate Page:

 

If Telerate Page 7052:

 

o Weekly Average

 

o Monthly Average

 

Designated CMT Maturity Index:

 

Prime Rate o

 

Other o

 

Other Base Rate:

 

Inverse
Floating Rate Note o

 

Fixed Interest Rate:

 

Floating
Rate/Fixed Rate o

 

Fixed Interest Rate:

 

Fixed Rate Commencement Date:

 

Index
Maturity:

 

Spread
and/or Spread Multiplier, if any:

 

Initial
Interest Rate, if any:

 

Initial
Interest Reset Date:

 

Interest
Reset Dates:

 

Rate
Determination Date(s):

 

Interest
Payment Frequency:

 

o
Monthly              o Quarterly

 

o Semi-Annually   o Annually

 

Maximum
Interest Rate, if any:

 

Minimum
Interest Rate, if any:

 

Additional/Other
Terms:

 

Regular
Record Date(s):

 

Sinking
Fund:

 

Day
Count Convention:

 

Computation
of Interest:

 

o 30 over
360             o Actual over Actual

 

o Actual over
360       o Other
(See attached)

 

Specified
Currency:

 

Exchange
Rate Agent:

 

Calculation
Agent:

 

Additional/Other
Terms:

 

 

The Protective Life Secured Trust designated above (the “Trust”), for
value received, hereby promises to pay to Cede & Co., or its registered
assigns, the Principal Amount on the Stated Maturity Date and, if so specified
above, to pay interest thereon from the Original Issue Date specified above or
from the most recent Interest Payment Date specified above to which interest
has been paid or duly provided for at the rate per annum determined in
accordance with the provisions on the reverse hereof and as specified above,
until the principal hereof is paid or made available for payment and (to the
extent that the payment of such interest shall be legally enforceable) at such
rate per annum on any overdue principal and premium and on any overdue installment
of interest as specified above.  Unless
otherwise specified above, payments of principal, premium, if any, and interest
hereon will be made in U.S. Dollars, as defined in the Indenture, dated as of
the Original Issue Date specified in the Pricing Supplement (the “Indenture”), between The Bank of New
York (the “Indenture Trustee”)
and the Trust.  If the Specified
Currency set forth above is a currency other than U.S. Dollars, the Holder
shall receive such payments in such Foreign Currency (as hereinafter
defined).  The “Principal Amount” of
this Note at any time means (1) if this Note is a Discount Note (as hereinafter
defined), the Amortized Face Amount (as hereinafter defined) at such time (as
defined in Section 3(b) on the reverse hereof) and (2) in all other
cases, the Registered Face Amount hereof. 
Capitalized terms not otherwise defined herein shall have their meanings
set forth in the Indenture or on the face hereof.

 

This Note will mature on the Stated Maturity Date, unless its principal
(or, any installment of its principal) becomes due and payable prior to the
Stated Maturity Date whether, as applicable, by the declaration of acceleration
of maturity, notice of redemption at the direction of the Trust, notice of the
Holder’s option to elect repayment or otherwise (the Stated Maturity Date or
any date prior to the Stated Maturity Date on which the principal amount of
this Note becomes due and payable, as the case may be, are referred to as the
“Maturity Date”) with respect to principal of this Note repayable on such
date).

 

A “Discount Note” is any Note that has an Issue Price that is less than
100% of the Registered Face Amount thereof by more than a percentage equal to
the product of 0.25% and the number of full years to the Stated Maturity Date.

 

Except as provided in the following paragraph, the Trust will pay
interest on each Interest Payment Date specified above, commencing with the
first (1st) Interest Payment Date next succeeding the Original Issue
Date, and on the Maturity Date; provided
that any payment of principal, premium, if any, or interest to be made on any
Interest Payment Date or on a Maturity Date that is not a Business Day (or, if
this Note is a LIBOR Note (as defined in Section 3(d)(v)(D) on the
reverse hereof), a day that is also not a London Business Day (as hereinafter
defined)) shall be made on the next succeeding Business Day (or, if this Note
is a LIBOR Note, on the next succeeding Business Day that is also a London
Business Day) with the same force and effect as if made on such Interest
Payment Date or such Maturity Date, as the case may be, except that with
respect to Interest Payment Dates, other than the Maturity Date, if this Note
is a LIBOR Note and such next succeeding Business Day that is also a London
Business Day falls in the next calendar month, such payment shall be made on
the Business Day that is also a London Business Day immediately preceding the
Interest Payment Date; provided
that, in connection with Floating Rate Notes, and except in the case of an
Interest Payment Date that falls on a Maturity Date, interest will continue to
accrue to but excluding the date the interest is paid.  The term “London Business Day” means a day other than a Saturday or
Sunday on which dealings

 

A-2-3

 

in
deposits in U.S. Dollars are transacted, or with respect to any future date are
expected to be transacted in the London interbank market.  Unless otherwise specified above, the
interest payable on each Interest Payment Date or the Maturity Date will be the
amount of interest accrued from and including the Original Issue Date or from
and including the last Interest Payment Date to which interest has been paid or
duly provided for, as the case may be, to, but excluding, such Interest Payment
Date or the Maturity Date, as the case may be.

 

Unless otherwise specified above, the interest payable on any Interest
Payment Date will, as provided in the Indenture, be paid to the Person in whose
name this Note (or one or more predecessor Notes) is registered at the close of
business on the Regular Record Date for such Interest Payment Date, which
Regular Record Date shall be the fifteenth (15th) calendar day,
whether or not a Business Day, immediately preceding the related Interest
Payment Date; provided that,
notwithstanding any provision of the Indenture to the contrary, interest
payable on any Maturity Date shall be payable to the Person to whom principal
shall be payable; and provided, further,
that unless otherwise specified above, in the case of a Note initially issued
between a Regular Record Date and the Interest Payment Date relating to such
Regular Record Date, interest for the period beginning on the Original Issue
Date and ending on such Interest Payment Date shall be paid on the Interest
Payment Date following the next succeeding Regular Record Date to the
registered Holder on such next succeeding Regular Record Date.

 

Payments of interest hereon (other than on the Maturity Date) will be
made in accordance with existing arrangements between the Indenture Trustee and
the Depositary.  Any principal, premium
and/or interest payable hereon on the Maturity Date will be paid by wire
transfer in immediately available funds to an account specified by the
Depositary (which account, unless otherwise provided above, will be at a bank
located outside the United States if payable in a Foreign Currency) upon
surrender of this Note at the Corporate Trust Office of the Indenture Trustee, provided that this Note is presented to
the Indenture Trustee (or any such Paying Agent) in time for the Indenture
Trustee (or any such Paying Agent) to make such payments in such funds in
accordance with its normal procedures.

 

Unless otherwise specified on the face hereof, the Holder hereof will
not be obligated to pay any administrative costs imposed by banks in making
payments in immediately available funds by the Trust.  Unless otherwise specified on the face hereof, any tax assessment
or governmental charge imposed upon payments hereunder, including, without limitation,
any withholding tax, will be borne by the Holder thereof.

 

REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET
FORTH ON THE REVERSE HEREOF.  SUCH
FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH
AT THIS PLACE.

 

Unless the certificate of authentication hereon shall have been
executed by the Indenture Trustee pursuant to the Indenture, this Note shall
not be entitled to any benefit under such Indenture or be valid or obligatory
for any purpose.

 

A-2-4

 

IN WITNESS WHEREOF, the Trust has caused this instrument to be duly
executed, by manual or facsimile signature.

 

 

	
   

  	
  THE
  PROTECTIVE LIFE SECURED TRUST

  SPECIFIED ON THE FACE OF THIS NOTE

  	 

	
   

  	 

	
  Dated:  Original Issue Date

  	
  By:
  Wilmington Trust Company, not in its individual

  capacity but solely as Delaware Trustee.

  	 

	
   

  	 

	
   

  	 

	
   

  	
  By:

  	
   

  	
   

  
					

 

 

CERTIFICATE OF AUTHENTICATION

 

This is one of the Notes of the Protective Life Secured Trust specified
on the face of this Note referred to in the within-mentioned Indenture.

 

 

	
   

  	
  THE
  BANK OF NEW YORK

  
	
   

  	
  As
  Indenture Trustee

  
	
   

  	
   

  
	
  Dated:  Original Issue Date

  	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  
	
   

  	
   

  

 

A-2-5

 

[REVERSE OF NOTE]

 

Section 1.  
General.  This Note is one of a duly authorized issue of Notes of the
Protective Life Secured Trust designated on the face hereof (the “Trust”).  The Series of Notes are issued pursuant to
the Indenture.  Capitalized terms not
otherwise defined herein shall have their meanings set forth in the Indenture.

 

Section 2.  
Currency.

 

(a)           Unless specified
otherwise on the face hereof, this Note is denominated in, and payments of
principal, premium, if any, and/or interest, if any, will be made in U.S.
Dollars.  If specified as the Specified
Currency on the face hereof this Series of Notes may be denominated in, and
payments of principal, premium, if any, and/or interest, if any, may be made in
a currency other than U.S. Dollars (a “Foreign Currency”).  If this Note is denominated in a Foreign
Currency, the Holder of this Note is required to pay for this Note in the
Specified Currency indicated on the face hereof.

 

(b)           Unless otherwise
specified on the face hereof, if payment hereon is required to be made in a
Foreign Currency and such currency is unavailable to the Trust for making
payments thereof due to the imposition of exchange controls or other
circumstances beyond the Trust’s control, or is no longer used by the
government of the country which issued such currency or for the settlement of
transactions by public institutions of or within the international banking
community, then the Trust will be entitled to make payments with respect hereto
in U.S. Dollars until such Foreign Currency is again available or so used.  The amount so payable on any date in such
Foreign Currency shall be converted into U.S. Dollars at a rate determined by
the Exchange Rate Agent on the basis of the noon buying rate in The City of New
York for cable transfers in the Foreign Currency as certified for customs
purposes by the Federal Reserve Bank of New York (the “Market Exchange Rate”)
for such Foreign Currency on the second (2nd) Business Day prior to
such payment date, or on such other basis as may be specified on the face
hereof.  In the event such Market
Exchange Rate is not then available, the Trust will be entitled to make
payments in U.S. Dollars (1) if such Foreign Currency is not a composite
currency, on the basis of the most recently available Market Exchange Rate for
such Foreign Currency or (2) if such Foreign Currency is a composite currency,
including, without limitation, euros, in an amount determined by the Exchange
Rate Agent to be the sum of the results obtained by multiplying the number of
units of each component currency of such composite currency, as of the most
recent date on which such composite currency was used, by the Market Exchange
Rate for such component currency on the second (2nd) Business Day
prior to such payment date (or if such Market Exchange Rate is not then
available, by the most recently available Market Exchange Rate for such
component currency, or as otherwise specified on the face hereof).  Any payment in respect hereof made under
such circumstances in U.S. Dollars will not constitute an Event of Default
under the Indenture.

 

A-2-6

 

(c)           If
the official unit of any component currency of a composite currency is altered
by way of combination or subdivision, the number of units of that currency as a
component shall be divided or multiplied in the same proportion.  If two or more component currencies are
consolidated into a single currency, the amounts of those currencies as
components shall be replaced by an amount in such single currency equal to the
sum of the amounts of the consolidated component currencies expressed in such
single currency.  If any component
currency is divided into two or more currencies, the amount of that original
component currency as a component shall be replaced by amounts of such two or
more currencies having an aggregate value on the date of division equal to the
amount of the former component currency immediately before such division.

 

(d)           In
the event of an official redenomination of the Specified Currency (including,
without limitation, an official redenomination of any such currency that is a
composite currency), the obligations of the Trust to make payments in or with
reference to such currency shall, in all cases, be deemed immediately following
such redenomination to be obligations to make payments in or with reference to
that amount of redenominated currency representing the amount of such currency
immediately before such redenomination. 
In no event shall any adjustment be made to any amount payable hereunder
as a result of (1) any redenomination of any component currency of any
composite currency (unless such composite currency is itself officially
redenominated) or (2) any change in the value of the specified currency
relative to any other currency due solely to fluctuations in exchange rates.

 

(e)           All
determinations referred to above made by the Exchange Rate Agent shall be at
its sole discretion (except to the extent expressly provided herein that any
determination is subject to approval by the Trust or the Administrator) and, in
the absence of manifest error, shall be conclusive for all purposes and binding
on the Trust, the Indenture Trustee and the Holder hereof, and the Exchange
Rate Agent shall have no liability therefor.

 

(f)            All
currency exchange costs will be borne by the Holder hereof by deduction from
the payments made hereon.

 

Section 3.  
Determination of Interest Rate and Certain Other Terms.

 

(a)           Fixed
Rate Notes.

 

(i)                            If
this Note is specified on the face hereof as a “Fixed Rate Note,” for the
period from the Original Issue Date, or from the last Interest Payment Date to
which interest has been paid or duly provided for, as the case may be, the
interest rate hereon shall be at the rate per annum stated on the face hereof
until, but excluding the date on which the Principal Amount is paid or made
available for payment.  Unless otherwise
specified on the face hereof, the rate of interest payable on this Note will
not be adjusted.

 

A-2-7

 

(ii)                           Unless
otherwise specified on the face hereof, the Interest Payment Dates for a Note
that provides for monthly interest payments shall be the fifteenth (15th)
day of each calendar month, beginning in the first (1st) calendar
month following the month in which the Note was issued; in the case of a Note
that provides for quarterly interest payments, the Interest Payment Dates shall
be the fifteenth (15th) day of every third (3rd) calendar
month, beginning in the third (3rd) calendar month following the
month in which the Note was issued; in the case of a Note that provides for
semi-annual interest payments, the Interest Payment Dates shall be the
fifteenth (15th) day of every sixth (6th) calendar month,
beginning in the sixth (6th) calendar month following the month in
which the Note was issued; and in the case of a Note that provides for annual
interest payments, the Interest Payment Date shall be the fifteenth (15th)
day of every twelfth calendar month, beginning in the twelfth (12th)
calendar month following the month in which the Note was issued.  Interest will be computed on the basis of a
360-day year of twelve 30-day months or, in the case of an incomplete month,
the number of days elapsed.

 

(b)           Discount
Notes.

 

(i)            If this Note is
specified on the face hereof as a “Discount Note,” this Note shall bear
interest at the rate set forth on the face hereof in the same manner as set
forth in Section 3(a) above, and payments of principal and interest
shall be made as set forth on the face hereof.

 

(ii)           In the event a
Discount Note is redeemed, repaid or accelerated, the amount payable to the
Holder of such Note on the Maturity Date will be equal to the sum of (1) the
Issue Price (increased by any accruals of Discount) and, in the event of any
redemption of Discount Notes, if applicable, multiplied by the Initial
Redemption Percentage (as adjusted by the Annual Redemption Percentage
Reduction, if applicable); and (2) any unpaid interest accrued on such Discount
Notes to the Maturity Date (the “Amortized Face Amount”).  For purposes of determining the amount of
Discount that has accrued as of any date on which a redemption, repayment or
acceleration of this Note occurs for Discount Notes, the Discount will be
accrued using a Constant Yield Method. 
The Constant Yield Method will be calculated using a 30-day month,
360-day year convention, a compounding period that, except for the Initial
Period (as defined below), corresponds to the shortest period between Interest
Payment Dates for the Discount Notes (with ratable accruals within a
compounding period), a coupon rate equal to the initial coupon rate applicable
to the applicable Discount Notes and an assumption that the Stated Maturity
Date of such Discount Notes will not be accelerated.  If the period from the Original Issue Date to the first (1st)
Interest Payment Date for Discount Notes (the “Initial Period”) is shorter than
the compounding period for such Discount Notes, a proportionate amount of the
yield for an entire compounding period will be accrued.  If the Initial Period is longer than the
compounding period, then the period will be divided into a regular compounding
period and a short period with the short period being treated as provided
above.

 

A-2-8

 

(c)           Amortizing
Notes.

 

(i)            If this Note is
specified on the face hereof as an “Amortizing Note,” this Note shall bear
interest at the rate set forth on the face hereof, in the same manner as set
forth in Section 3(a) above and payments of principal, premium (if any)
and interest shall be made as set forth on the face hereof and/or in accordance
with Schedule  I attached
hereto.

 

(ii)           If it is specified
on the face hereof that this Note is an Amortizing Note, the Trust will make
payments combining principal, premium (if any) and interest, if applicable, on
the dates and in the amounts set forth in the table, or in accordance with the
formula, appearing in Schedule I, attached to this Note.  If this Note is an Amortizing Note, payments
made hereon will be applied first to interest due and payable on each such
payment date and then to the reduction of the Outstanding Face Amount.  The term “Outstanding Face Amount” means, at
any time, the amount of unpaid principal hereof at such time.

 

(d)           Floating
Rate Notes.

 

(i)            If this Note is
specified on the face hereof as a “Floating Rate Note,” interest on this Note
shall accrue and be payable in accordance with this Section 3(d).  A Floating Rate Note may be a CD Rate Note,
Commercial Paper Rate Note, Federal Funds Rate Note, LIBOR Note, Treasury Rate
Note, Constant Maturity Treasury Rate Note, a Prime Rate Note, an Inverse
Floating Rate Note or a Floating Rate/Fixed Rate Note.  For the period from the Original Issue Date
to, but not including, the first (1st) Interest Reset Date set forth
on the face hereof, the interest rate hereon shall be the Initial Interest Rate
specified on the face hereof. 
Thereafter, the interest rate hereon will be reset as of and be
effective as of each Interest Reset Date; provided,
however, that the interest rate in effect for the ten (10) days
immediately prior to the Maturity Date will be that in effect on the tenth (10th)
day preceding such Maturity Date.

 

(A)          Unless specified
otherwise on the face hereof, Interest Reset Dates are as follows:  (1) in the case of Notes that reset daily, each
Business Day, (2) in the case of Notes that reset weekly, other than Treasury
Rate Notes, the Wednesday of each week, (3) in the case of Treasury Rate Notes
that reset weekly and except as provided below under “Treasury Rate Notes,” the
Tuesday of each week, (4) in the case of Notes that reset monthly, the
fifteenth (15th) day of each calendar month, beginning in the first
(1st) calendar month following the month in which the Note was
issued, (5) in the case of Notes that reset quarterly, the fifteenth (15th)
day of every third (3rd) calendar month, beginning in the third (3rd)
calendar month following the month in which the Note was issued, (6) in the
case of Notes that reset semiannually, the fifteenth (15th) day of
every sixth (6th) calendar month, beginning in the sixth (6th)
calendar month following the month in which the Note was issued and (7)

 

A-2-9

 

in the case of Notes that reset annually, the fifteenth (15th)
day of every twelfth (12th) calendar month, beginning in the twelfth
(12th) calendar month following the month in which the Note was
issued.

 

(B)           If any Interest
Reset Date would otherwise be a day that is not a Business Day (or, if this
Note is a LIBOR Note, a day or Business Day that is not a London Business Day),
such Interest Reset Date shall be postponed to the next day that is also a
Business Day (or, if this Note is a LIBOR Note, to the next Business Day that
is a London Business Day); provided,
however, that if this Note is a LIBOR Note and such Business Day
that is also a London Business Day is in the next succeeding calendar month,
such Interest Reset Date shall be the Business Day that is also a London
Business Day immediately preceding such Reset Date.  If this Note is a Treasury Rate Note (as defined below) and an
auction date for direct obligations of United States securities shall fall on
any Interest Reset Date, then such Interest Reset Date shall instead be the
first (1st) Business Day immediately following such auction date.

 

(C)           If this Note has
more than one Interest Reset Date, accrued interest will be calculated by
multiplying the Principal Amount of the Note specified on the face hereof by an
Accrued Interest Factor.  The Accrued
Interest Factor will be computed by adding the interest factors calculated for
each day in the Interest Reset Period for which accrued interest is being
calculated.  The Interest Reset Period
is the period from each Interest Reset Date to, but not including, the
following Interest Reset Date.  Unless
otherwise specified on the face hereof, the Interest Factor for each such day
will be computed by dividing the interest rate in effect on that day by 360, in
the case of CD Rate Notes, Commercial Paper Rate Notes, Federal Funds Rate
Notes, LIBOR Notes and Prime Rate Notes. 
In the case of Treasury Rate Notes and Constant Maturity Treasury Rate
Notes, the Interest Factor for each such day will be computed by dividing the
interest rate by the actual number of days in the year.  The Interest Rate Basis shall be set forth
on the face hereof and shall be the Interest Rate Basis, as adjusted in
accordance with any Spread or Spread Multiplier and subject to any Maximum
Interest Rate or Minimum Interest Rate specified on the face hereof.  Notwithstanding Section 3(d)(i)(E)
below, the Interest Factor will be expressed as a decimal calculated to seven
decimal places without rounding.  For
purposes of making the foregoing calculation, the interest rate in effect on
any Interest Reset Date will be the applicable rate as reset on that date.  Unless otherwise specified on the face
hereof, the interest rate that is effective on the applicable Interest Reset
Date will be determined on the applicable Rate Determination Date and calculated
on the applicable Calculation Date. 
Unless otherwise specified on the face hereof, the interest rate in
effect for each day to and excluding the next Interest Reset Date will be the
interest rate that was in effect on the preceding Interest Reset Date.  “Calculation Date” means the date by which
the Calculation Agent specified on the face hereof, is to calculate

 

A-2-10

 

the interest rate which will be the earlier of (1) the fifth (5th)
Business Day after the related Rate Determination Date, or if any such day is
not a Business Day, the next Business Day and (2) the Business Day preceding
the applicable Interest Payment Date or the Maturity Date.

 

(D)          If this Note has one
Interest Reset Date, accrued interest will be calculated by multiplying the
Principal Amount of the Note specified on the face hereof by the interest rate
in effect during the period for which accrued interest is being
calculated.  That product is then
multiplied by the quotient obtained by dividing the number of days in the period
for which accrued interest is being calculated by 360, in the case of CD Rate
Notes, Commercial Paper Rate Notes, Federal Funds Rate Notes, LIBOR Notes and
Prime Rate Notes.  In the case of
Treasury Rate Notes and Constant Maturity Treasury Rate Notes, the product is
multiplied by the quotient obtained by dividing the number of days in the
period for which accrued interest is being calculated by the actual number of
days in the year.

 

(E)           Unless otherwise
specified on the face hereof, all percentages resulting from any calculation of
the interest rate on this Note will be rounded, if necessary, to the nearest
1/100,000 of 1% (.0000001), with five one-millionths of a percentage point
rounded upward.  All currency amounts
used in, or resulting from, the calculation on a Floating Rate Note will be
rounded to the nearest one-hundredth of a unit.  For purposes of such rounding, .005 of a unit will be rounded
upward.

 

(ii)           Unless otherwise
specified on the face hereof and except as provided below, interest will be
payable as follows: (1) if the Reset Date for a Note is daily, weekly or
monthly, interest will be payable on the fifteenth (15th) day of
each calendar month, beginning in the first (1st) calendar month
following the month in which the Note was issued, (2) if the Reset Date for a
Note is quarterly, interest will be payable on the fifteenth (15th)
day of every third (3rd) calendar month, beginning in the third (3rd)
calendar month following the month in which the Note was issued, (3) if the
Reset Date for a Note is semiannually, interest will be payable on the
fifteenth (15th) day of every sixth (6th) calendar month,
beginning in the sixth (6th) calendar month following the month in
which the Note was issued, (4) if the Reset Date for a Note is annually,
interest will be payable on the fifteenth (15th) day of every
twelfth (12th) calendar month, beginning in the twelfth (12th)
calendar month following the month in which the Note was issued.  In each of these cases, interest will also
be payable on the Maturity Date.

 

(iii)          If specified on the
face hereof, this Note may have either or both of a Maximum Interest Rate or
Minimum Interest Rate.  If a Maximum
Interest Rate is so designated, the interest rate for a Floating Rate Note
cannot ever exceed such Maximum Interest Rate and in the event that the
interest rate on any Interest Reset Date would exceed such Maximum Interest
Rate (as if no Maximum Interest Rate were in effect) then the interest rate on
such Reset Date shall be the Maximum Interest Rate.  If a Minimum Interest Rate is so designated, the interest rate
for a

 

A-2-11

 

Floating Rate Note cannot ever be less than such Minimum Interest Rate
and in the event that the interest rate on any Interest Reset Date would be
less than such Minimum Interest Rate (as if no Minimum Interest Rate were in
effect) then the interest rate on such Reset Date shall be the Minimum Interest
Rate.  Notwithstanding anything to the
contrary contained herein, the interest rate on a Floating Rate Note shall not
exceed the maximum interest rate permitted by applicable law.

 

(iv)          All determinations
of interest by the Calculation Agent will, in the absence of manifest error, be
conclusive for all purposes and binding on the Trust, the Indenture Trustee and
the Holder of this Note and neither the Trust, the Indenture Trustee nor the
Calculation Agent shall have any liability to the Holder of this Note in
respect of any determination, calculation, quote or rate made or provided by the
Calculation Agent.  Upon request of the
Holder of this Note, the Calculation Agent will provide the interest rate then
in effect and, if determined, the interest rate that will become effective on
the next Interest Reset Date with respect to this Note.  The Calculation Agent will notify the
Indenture Trustee, Paying Agent, Registrar, the Trust and if this Note is
listed on a stock exchange, and the rules of such exchange so require, such
exchange of each determination of the interest rate, Initial Interest Period,
Interest Reset Period, and interest amount payable applicable to this Note
promptly after such determination is made. 
If the Calculation Agent is incapable or unwilling to act as such or if
the Calculation Agent fails duly to establish the interest rate for any
interest accrual period or to calculate the interest amount or any other
requirements, the Trust will appoint the Paying Agent or another leading
commercial bank to act as such in its place.

 

(v)           Subject to
applicable provisions of law and except as specified herein, on each Interest
Reset Date, the rate of interest on this Note on and after the first (1st)
Interest Reset Date shall be the interest rate determined in accordance with
the provisions of the heading below which has been designated as the Interest
Rate Basis on the face hereof, the base rate, plus or minus the Spread, if any,
specified on the face hereof and/or multiplied by the Spread Multiplier, if
any, specified on the face hereof.

 

(A)          CD Rate Notes.  If the Interest Rate Basis is the CD Rate,
this Note shall be deemed to be a “CD Rate Note.” A CD Rate Note will bear
interest at the interest rate calculated with reference to the CD Rate and the
Spread or Spread Multiplier, if any. 
The Calculation Agent will determine the CD Rate for each CD Rate
Determination Date by the Calculation Date pertaining to such CD Rate
Determination Date.  The CD Rate
Determination Date is the second (2nd) Business Day prior to the
Interest Reset Date for each Interest Reset Period.  Unless otherwise specified on the face hereof, “CD Rate” means
the rate for negotiable certificates of deposit having the Index Maturity
specified on the face hereof as published in H.15(519) under the heading “CDs
(Secondary Market)” or, if not so published by 3:00 p.m., New York City time,
on the Calculation Date pertaining to such CD Rate Determination Date, the CD

 

A-2-12

 

Rate for the Interest Reset Period will be the rate on such date for
negotiable certificates of deposit of the applicable Index Maturity as
published in the H.15 Daily Update under the heading “CDs (Secondary
Market).”  If such rate is not yet
published in either H.15(519) or the H.15 Daily Update by 3:00 p.m., New York
City time, on such Calculation Date, then the CD Rate will be the arithmetic
mean of the secondary market offered rates as of 3:00 p.m., New York City time,
on such date, of three (3) leading nonbank dealers in negotiable U.S. Dollar
certificates of deposit in New York City selected by the Calculation Agent
after consultation with the Trust for negotiable certificates of deposit of
major United States money center banks of the highest credit standing (in the
market for negotiable certificates of deposit) with a remaining maturity
closest to the applicable Index Maturity in a denomination of $5,000,000; provided, however, that if the dealers
selected as aforesaid by the Calculation Agent are not quoting as mentioned
above, the CD Rate for the applicable Interest Reset Period will be the CD Rate
for the immediately preceding Interest Reset Period.  If there was no such Interest Reset Period, the CD Rate shall be
the Initial Interest Rate.  “H.15(519)”
means the publication entitled “Statistical Release H.15(519), Selected
Interest Rates,” or any successor publication, published weekly by the Board of
Governors of the Federal Reserve System; and “H.15 Daily Update” means the
daily update of the Board of Governors of the Federal Reserve System at
http://www.federalreserve.gov/releases/h15/update/, or any successor site or
publication.

 

(B)           Commercial Paper
Rate Notes.  If the Interest Rate
Basis is the Commercial Paper Rate, this Note shall be deemed to be a
“Commercial Paper Rate Note.” A Commercial Paper Rate Note will bear interest
for each Interest Reset Period at the interest rate calculated with reference
to the Commercial Paper Rate and the Spread or Spread Multiplier, if any.  The Calculation Agent will determine the
Commercial Paper Rate for each Commercial Paper Rate Determination Date by the
Calculation Date pertaining to such Commercial Paper Rate Determination
Date.  The Commercial Paper Rate
Determination Date is the second (2nd) Business Day prior to the
Interest Reset Date for each Interest Reset Date for each Interest Reset
Period.  Unless otherwise specified on
the face hereof, “Commercial Paper Rate” means the Money Market Yield
(calculated as described below) on the Calculation Date of the rate for
commercial paper having the Index Maturity specified on the face hereof as such
rate is published in H.15(519) under the heading “Commercial Paper —
Nonfinancial.”  If such rate is not
published by 3:00 p.m., New York City time, on the Calculation Date pertaining
to such Commercial Paper Rate Determination Date, then the Commercial Paper
Rate for the Interest Reset Period shall be the Money Market Yield of the rate
on such date for commercial paper having the applicable Index Maturity as
published in the H.15 Daily Update or such other recognized electronic source
used for the purpose of displaying such rate, under the heading “Commercial
Paper —

 

A-2-13

 

Nonfinancial.”  If such rate is
not yet published in either H.15(519) or H.15 Daily Update or such other
recognized electronic source used for the purpose of displaying this rate, by
3:00 p.m., New York City time, on such Calculation Date, then the Commercial
Paper Rate for the Interest Reset Period shall be the Money Market Yield of the
arithmetic mean of the offered rates, as of 3:00 p.m., New York City time, on
such date, of three (3) leading dealers of commercial paper in New York City
selected by the Calculation Agent after consultation with the Trust for
commercial paper having the applicable Index Maturity placed for an industrial
issuer whose bond rating is “AA” or the equivalent, from a nationally
recognized securities rating agency; provided,
however, that if the dealers selected by the Calculation Agent are
not quoting offered rates as mentioned above, the Commercial Paper Rate for the
Interest Reset Period will be the same as the Commercial Paper Rate for the
immediately preceding Interest Reset Period. 
If there was no such Interest Reset Period, the Commercial Paper Rate
will be the Initial Interest Rate. 
“Money Market Yield” shall be a yield calculated in accordance with the
following formula:

 

Money Market Yield =          D
X 360           x          100

                                         360
- (D X M)

 

where “D” refers to the per annum rate for commercial paper quoted on a
bank discount basis and expressed as a decimal; and “M” refers to the actual
number of days in the applicable Index Maturity.

 

(C)           Federal Funds
Rate Notes.  If the Interest Rate
Basis is the Federal Funds Rate, this Note shall be deemed to be a “Federal
Funds Rate Note.” A Federal Funds Rate Note will bear interest for each
Interest Reset Period at the interest rate calculated with reference to the
Federal Funds Rate and the Spread or Spread Multiplier, if any.  The Calculation Agent will determine the Federal
Funds Rate for each Federal Funds Rate Determination Date by the Calculation
Date pertaining to such Federal Funds Rate Determination Date.  The Federal Funds Rate Determination Date is
the second (2nd) Business Day prior to the Interest Reset Date for
each Interest Reset Period.  Unless
otherwise specified on the face hereof, “Federal Funds Rate” means the rate for
Federal Funds as published in H.15(519) under the heading “Federal Funds
(Effective),” as this rate is displayed on Moneyline Telerate, Inc. on page
120, or any successor service or page (“Telerate Page 120”) or, if not so
displayed or published by 3:00 p.m., New York City time, on the Calculation
Date pertaining to such Rate Determination Date, the Federal Funds Rate for the
Interest Reset Period will be the rate on such Calculation Date as published in
the H.15 Daily Update, or another recognized electronic source used for the
purpose of displaying this rate, under the heading “Federal Funds (Effective).”  If such rate is not yet published in either
H.15(519), H.15

 

A-2-14

 

Daily Update or another recognized electronic source used for the
purpose of displaying this rate by 3:00 p.m., New York City time, on the
Calculation Date then the Federal Funds Rate for such Interest Reset Period
will be the arithmetic mean of the rates, as of 3:00 p.m., New York City time,
on the Calculation Date, for the last transaction in overnight Federal Funds
arranged by three (3) leading brokers of Federal Funds transactions in New York
City selected by the Calculation Agent after consultation with the Trust.  If the dealers selected by the Calculation
Agent, however, are not quoting rates as described above, the Federal Funds
Rate for the Interest Reset Period will be the same as the Federal Funds Rate
in effect for the immediately preceding Interest Reset Period.  If there was no such Interest Reset Period,
the Federal Funds Rate will be the Initial Interest Rate.

 

If this Note is a Federal Funds Rate Note that resets daily, the
interest rate on the Note for the period from and including a Monday to, but
excluding, the succeeding Monday will be reset by the Calculation Agent on the
second (2nd) Monday, or, if not a Business Day, on the next Business
Day, to a rate equal to the average of the Federal Funds Rates in effect for
each such day in such week.

 

(D)          LIBOR Notes.  If the Interest Rate Basis is LIBOR, this
Note shall be deemed to be a “LIBOR Note.” A LIBOR Note will bear interest for
each Interest Period at the interest rate calculated with reference to LIBOR
and the Spread or Spread Multiplier, if any. 
The Calculation Agent will determine LIBOR for each LIBOR Determination
Date by the Calculation Date pertaining to such LIBOR Determination Date.  The LIBOR Determination Date is the second
(2nd) London Business Day prior to the Interest Reset Date for each
Interest Reset Period.

 

(1)           Unless otherwise
indicated on the face hereof, on a LIBOR Determination Date, the Calculation
Agent will determine LIBOR for each Interest Reset Period as follows:

 

The Calculation Agent will determine the offered rates for deposits in
U.S. Dollars for the period of the Index Maturity specified on the face hereof,
commencing on the Interest Reset Date, which appears on the “designated LIBOR
page” as of 11:00 a.m., London time, on that LIBOR Determination Date.  If “LIBOR Telerate” is designated on the
face hereof, “designated LIBOR page” means the display on Moneyline Telerate,
Inc. on page 3750, or any successor service or page for the purpose of
displaying the London interbank offered rates of major banks.  If “LIBOR Reuters” is designated on the face
hereof, “designated LIBOR page” means the arithmetic mean determined by the
Calculation Agent of the two (2) or more offered rates (unless the designated
LIBOR page by its terms provides only for a single rate, in which case such

 

A-2-15

 

single rate shall be used) on the display on the Reuters Monitor Money
Rates Service Page “LIBOR,” or any successor service or page for the purpose of
displaying the London interbank offered rates of major banks.  If neither “LIBOR Telerate” nor “LIBOR
Reuters” is specified on the face hereof, LIBOR will be determined as if LIBOR
Telerate had been specified.

 

(2)           If LIBOR cannot be
determined on a LIBOR Determination Date as described above, then the
Calculation Agent will determine LIBOR as follows:

 

The Calculation Agent will select four (4) major banks in the London
interbank market after consultation with the Trust.  The Calculation Agent will request that the principal London
offices of those four (4) selected banks provide their offered quotations to
prime banks in the London interbank market at approximately 11:00 a.m., London
time, on the LIBOR Determination Date. 
These quotations will be for deposits in U.S. Dollars for the period of
the Index Maturity specified on the face hereof, commencing on the Interest
Reset Date.  Offered quotations must be
based on a principal amount equal to an amount that is representative of a
single transaction in U.S. Dollars in the market at the time.  If two (2) or more quotations are provided,
LIBOR for the Interest Reset Period will be the arithmetic mean of the quotations.  If fewer than two (2) quotations are
provided, the Calculation Agent will select three (3) major banks in New York
City after consultation with the Trust and then determine LIBOR for the
Interest Reset Period as the arithmetic mean of rates quoted by those three (3)
major banks in New York City to leading European banks at approximately 3:00
p.m., New York City time, on the LIBOR Determination Date.  The rates quoted will be for loans in U.S.
Dollars, for the period of the Index Maturity specified on the face hereof,
commencing on the Interest Reset Date. 
Rates quoted must be based on a principal amount equal to an amount that
is representative of a single transaction in U.S. Dollars in the market at the
time.  If fewer than three (3) New York
City banks selected by the Calculation Agent are quoting rates, LIBOR for the
Interest Reset Period will be the same as LIBOR for the immediately preceding
Interest Reset Period.  If there was no
such Interest Reset Period, LIBOR will be the Initial Interest Rate.

 

(E)           Treasury Rate
Notes.

 

(1)           If the Interest Rate
Basis is the Treasury Rate, this Note shall be deemed to be a “Treasury Rate
Note.” A Treasury Rate Note will bear interest for each Interest Reset Period
at the interest rate calculated with reference to the Treasury Rate and the
Spread

 

A-2-16

 

or Spread Multiplier, if any. 
The Calculation Agent will determine the Treasury Rate for each Treasury
Rate Determination Date by the Calculation Date pertaining to such Treasury
Rate Determination Date.  Unless
“Constant Maturity Treasury Rate” is specified on the face hereof and unless
otherwise set forth on the face hereof, the Treasury Rate for each Interest
Reset Period will be the rate for the auction held on the Treasury Rate
Determination Date for the Interest Reset Period of U.S. treasury securities
having the Index Maturity specified on the face hereof as that rate appears on
the display on Moneyline Telerate, Inc. (or any successor service) on page 56
(or any other page as may replace this page on that service) under the heading
“Investment Rate” or, if not so published by 3:00 p.m., New York City time, on
such Calculation Date pertaining to the Treasury Rate Determination Date, then
the Treasury Rate for the Interest Reset Period will be the auction average
rate (expressed as a bond equivalent on the basis of a year of 365 or 366 days,
as applicable, and applied on a daily basis) on such Treasury Rate
Determination Date as otherwise announced by the United States Department of
the Treasury.  In the event that the
results of the auction are not published or reported as provided above by 3:00
p.m., New York City time, on such Calculation Date, or if no such auction is
held on such Treasury Rate Determination Date, then the Treasury Rate for such Interest
Reset Period shall be the rate having the Index Maturity specified on the face
hereof as published in H.15(519) under the heading “U.S. Government
Securities—Treasury bills (Secondary Market)” or, if not published by 3:00
p.m., New York City time, on the Calculation Date, the rate on the Treasury
Rate Determination Date of treasury securities as published in H.15 Daily
Update, or another recognized electronic source used for the purpose of
displaying that rate, under the heading “U.S. Government Securities—Treasury
Bills (Secondary Market).”  If none of
the above rates is published by 3:00 p.m., New York City time on the
Calculation Date, then the Treasury Rate shall be calculated as a yield to
maturity (expressed as a bond equivalent on the basis of a year of 365 or 366
days, as applicable, and applied on a daily basis) of the arithmetic mean of
the secondary market bid rates as of approximately 3:30 p.m., New York City
time, on such Treasury Rate Determination Date, of three (3) leading primary
United States government securities dealers selected by the Calculation Agent
for the issue of treasury securities with a remaining maturity closest to the
Index Maturity specified on the face hereof, provided,
however, that if the dealers selected as aforesaid by the
Calculation Agent are not quoting bid rates as mentioned above, then the
Treasury Rate for the Interest Reset Period will be the same as the Treasury
Rate for the immediately preceding Interest

 

A-2-17

 

Reset Period.  If there was no
such Interest Reset Period, the Treasury Rate will be the Initial Interest
Rate.

 

(2)           The “Treasury Rate
Determination Date” for each Interest Reset Period will be the day of the week
in which the Interest Reset Date for such Interest Reset Period falls on which
treasury securities would normally be auctioned.  Treasury securities are normally sold at auction on Monday of
each week, unless that day is a legal holiday, in which case the auction is
normally held on the following Tuesday, except that such auction may be held on
the preceding Friday.  If, as the result
of a legal holiday, an auction is so held on the preceding Friday, such Friday
will be the Treasury Rate Determination Date pertaining to the Interest Reset
Period commencing in the next succeeding week. 
If an auction date shall fall on any day that would otherwise be an
Interest Reset Date for a Treasury Rate Note, then such Interest Reset Date
shall instead be the Business Day immediately following such auction date.

 

(F)           Constant Maturity
Treasury Rate Notes.

 

(1)           If the Interest Rate
Basis is the Constant Maturity Treasury Rate, this Note shall be deemed to be a
“Constant Maturity Treasury Rate Note.” 
A Constant Maturity Treasury Rate Note will bear interest for each
Interest Reset Period at the interest rate calculated with reference to the
Constant Maturity Treasury Rate and the Spread or Spread Multiplier, if
any.  If “Constant Maturity Treasury
Rate” is specified on the face hereof and unless otherwise specified on the
face hereof, “Constant Maturity Treasury Rate” for each Interest Reset Period
will be the rate displayed on the Designated Constant Maturity Treasury Page
(as defined below) under the caption “Treasury Constant Maturities” under the
column for the Designated CMT Maturity Index for either (1) that Constant
Maturity Treasury Rate Determination Date (as hereinafter defined), if the
Designated Constant Maturity Treasury Page is 7051 (or any other page that may
replace this page on that service); or (2) the week, or the month, as set forth
on the face hereof, ended immediately preceding the week in which the
Calculation Date pertaining to the Constant Maturity Treasury Rate
Determination Date occurs, if the Designated Constant Maturity Treasury Page is
7052 (or any other page that may replace this page on that service).

 

If the Treasury Rate is no longer displayed on the Designated Constant
Maturity Treasury Page, or if not displayed by 3:00 p.m., New York City time,
on the Calculation Date pertaining to the Constant Maturity Treasury Rate
Determination Date, then the Constant Maturity Treasury Rate will be the
Treasury Constant

 

A-2-18

 

Maturity rate for the Designated CMT Maturity Index (as hereinafter
defined) as published in H.15(519) for the Constant Maturity Treasury Rate
Determination Date.  If the Constant
Maturity Treasury Rate is no longer published, or if not published in H.15(519)
by 3:00 p.m., New York City time, on the Calculation Date pertaining to the
Constant Maturity Treasury Rate Determination Date, then the Constant Maturity
Treasury Rate for that Constant Maturity Treasury Rate Determination Date will
be the Treasury Constant Maturity rate for the Designated CMT Maturity Index
(or other United States Treasury Rate for the Designated CMT Maturity Index)
for that Constant Maturity Treasury Rate Determination Date with respect to the
Interest Reset Date then published by either the Board of Governors of the
Federal Reserve System or the United States Department of the Treasury that the
Calculation Agent determines is comparable to the rate formerly displayed on
the Designated Constant Maturity Treasury Page and published in the relevant
H.15(519).  If the information in the
immediately preceding sentence is not available by 3:00 p.m., New York City
time, on the Calculation Date pertaining to the Constant Maturity Treasury Rate
Determination Date, then the Calculation Agent will calculate the Constant
Maturity Treasury Rate to be a yield to maturity, based on the arithmetic mean
of the secondary market offer side prices as of approximately 3:30 p.m., New
York City time, on the Constant Maturity Treasury Rate Determination Date
reported, according to their written records, by three (3) leading primary
United States government securities dealers (each, a “CMT Reference Dealer”) in
the City of New York selected by the Calculation Agent.  The three (3) CMT Reference Dealers shall be
selected from five CMT Reference Dealers selected by the Calculation Agent by
eliminating the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality, one of the
lowest), for the most recently issued direct noncallable fixed rate obligations
of the United States (“Treasury Notes”) with an original maturity of
approximately the Designated CMT Maturity Index and a remaining term to
maturity of not less than such Designated CMT Maturity Index minus one
year.  If the Calculation Agent cannot
obtain three (3) Treasury Note quotations as described above, the Treasury Rate
will be a rate with a yield to maturity based on the arithmetic mean of the
secondary market offer side prices as of approximately 3:30 p.m., New York City
time, on the Constant Maturity Treasury Rate Determination Date of three (3)
CMT Reference Dealers in the City of New York. 
The three (3) CMT Reference Dealers shall be selected from five CMT
Reference Dealers selected by the Calculation Agent and eliminating the highest
quotation (or, in the

 

A-2-19

 

event of equality, one of the highest) and the lowest quotation (or, in
the event of equality, one of the lowest), for Treasury Notes with an original
maturity of the number of years that is the next highest to the Designated CMT
Maturity Index and a remaining term to maturity closest to the Designated CMT
Maturity Index and in an amount of at least $100 million.  If two (2) of these Treasury Notes have remaining
terms to maturity equally close to the Designated CMT Maturity Index, the
quotes for the Treasury Note with the shorter remaining term to maturity will
be used.  If fewer than five but more
than two (2) CMT Reference Dealers are quoting as described above, then the
Treasury Rate will be based on the arithmetic mean of the offer prices obtained
and neither the highest nor lowest of those quotes will be eliminated; provided, however, that if fewer than
three (3) CMT Reference Dealers are quoting as described above, then the
Constant Maturity Treasury Rate for the Interest Reset Period will be the same
as the Constant Maturity Treasury Rate for the immediately preceding Interest
Reset Period.  If there was no such
Interest Reset Period, the Constant Maturity Treasury Rate will be the Initial
Interest Rate.

 

(2)           For purposes of
Constant Maturity Treasury Rate Notes, the “Constant Maturity Treasury Rate
Determination Date” will be the tenth (10th) Business Day prior to
the Interest Reset Date for the applicable Interest Reset Period.  “Designated Constant Maturity Treasury Page”
means the display on Moneyline Telerate, Inc. on the page designated on the
face hereof, or any successor service or page for the purpose of displaying
Treasury Constant Maturities as reported in H.15(519).  If that page is not specified on the face
hereof, the Designated Constant Maturity Treasury Page shall be 7052, for the
most recent week.  “Designated CMT
Maturity Index” means the original period to maturity of the Treasury Notes
(either 1, 2, 3, 5, 7, 10, 20, or 30 years) designated on the face hereof with
respect to which the Constant Maturity Treasury Rate will be calculated.  If no such maturity is specified on the face
hereof, the Designated CMT Maturity Index shall be 2 years.

 

(G)           Prime Rate Notes.  If the Interest Rate Basis is the Prime
Rate, this Note shall be deemed to be a “Prime Rate Note.”  A Prime Rate Note will bear interest for
each Interest Reset Period calculated with reference to the Prime Rate and the
Spread or Spread Multiplier, if any, specified on the face hereof.  The Calculation Agent will determine the
Prime Rate for each Interest Reset Period on each Prime Rate Determination Date
by the Calculation Date pertaining to such Prime Rate Determination Date.  The Prime Rate Determination Date is the second
(2nd) Business Day prior to the Interest Reset Date for each
Interest Reset Period.  Unless otherwise
specified on the face hereof, “Prime Rate” means the rate on the

 

A-2-20

 

Calculation Date made available and subsequently published on the
Calculation Date in H.15(519) under the heading “Bank Prime Loan” or, if not so
published by 3:00 p.m., New York City time, on the Calculation Date pertaining
to such Prime Rate Determination Date, the Prime Rate will be the rate on that
day as published in the H.15 Daily Update or another recognized electronic
source used for the purpose of displaying this rate, under the heading “Bank
Prime Loan,” or if neither such rate is published by 3:00 p.m., New York City time,
on such Calculation Date pertaining to the Prime Rate Determination Date, the
Prime Rate will be the arithmetic mean of the rates of interest offered by
various banks that appear on the Reuters Screen USPRIME1 Page (hereinafter
defined) as each such bank’s prime rate or base lending rate as in effect for
the Prime Rate Determination Date.  If
fewer than four (4) such rates appear on the Reuters Screen USPRIME1 Page, the
Calculation Agent will select three (3) major banks in New York City after
consultation with the Trust.  The Prime
Rate will be the arithmetic mean of the prime rates quoted by those three (3)
banks on the basis of the actual number of days in the year divided by a
360-day year as of the close of business on such Prime Rate Determination Date;
provided, however, that if fewer
than three (3) banks in New York City are quoting as mentioned in this
sentence, the Prime Rate for the Interest Reset Period will be the same as the
Prime Rate in effect for the immediately preceding Interest Reset Period.  If there was no such Interest Reset Period,
the Prime Rate will be the Initial Interest Rate.  “Reuters Screen USPRIME1 Page” means the display designated as
page “USPRIME1” on the Reuters Monitor Money Rates Service, or any successor
service or page, for the purpose of displaying prime rates or base lending
rates of major United States banks.

 

(H)          Inverse Floating
Rate Notes.  If this Note is
designated as an Inverse Floating Rate Note on the face hereof, the Inverse
Floating Rate shall be equal to (1) in the case of the period, if any,
commencing on the Original Issue Date (or such other date which may be
specified on the face hereof as the date on which this Note shall begin to
accrue interest), up to the first (1st) Interest Reset Date, a fixed
rate of interest established by the Trust as specified on the face hereof, and
(2) in the case of each period commencing on an Interest Reset Date, a fixed
rate of interest as specified on the face hereof minus the interest rate
determined based on the Interest Rate Basis as adjusted by the Spread or Spread
Multiplier, if any; provided, however,
that (1) the interest rate will not be less than zero and (2) the interest rate
in effect for the ten (10) days immediately prior to the Maturity Date will be
that in effect on the tenth (10th) day preceding the Maturity Date.

 

(I)            Floating
Rate/Fixed Rate Notes.  If this Note
is designated as a “Floating Rate/Fixed Rate Note” on the face hereof, this
Note will be a Floating Rate Note for a specified portion of its term and a
Fixed Rate Note for the remainder of its term, commencing on the Fixed Rate

 

A-2-21

 

Commencement Date specified on the face hereof, in which event the
interest rate on this Note will be determined as provided herein as if it were
a Floating Rate Note and a Fixed Rate Note hereunder for each such respective
period.

 

Section 4.  
Optional Redemption.  If no redemption right is set forth on the
face hereof, this Note may not be redeemed prior to the Stated Maturity Date,
except as set forth in the Indenture. 
If a Redemption Right is set forth on the face of this Note, the Trust
shall elect to redeem this Note on the Interest Payment Date after the Initial
Redemption Date set forth on the face hereof on which the Funding Agreement is
to be redeemed in whole or in part by Protective Life Insurance Company
(“Protective Life”) (each, a “Redemption Date”), in which case this Note must
be redeemed on such Redemption Date in whole or in part, as applicable, in increments
of $1,000 at the applicable Redemption Price (as defined below), together with
unpaid interest accrued thereon to the applicable Redemption Date.  “Redemption Price” shall mean an amount
equal to the Initial Redemption Percentage (as adjusted by the Annual
Redemption Percentage Reduction, if applicable) multiplied by the unpaid
Principal Amount of this Note to be redeemed. 
The unpaid Principal Amount of this Note to be redeemed shall be
determined by multiplying (1) the Outstanding Principal Amount of this Note by
(2) the quotient derived by dividing (A) the outstanding principal amount of
the Funding Agreement to be redeemed by Protective Life, by (B) the outstanding
principal amount of the Funding Agreement. 
The Initial Redemption Percentage, if any, applicable to this Note shall
decline at each anniversary of the Initial Redemption Date by an amount equal
to the applicable Annual Redemption Percentage Reduction, if any, until the
Redemption Price is equal to 100% of the Principal Amount thereof to be
redeemed.  Notice must be given not more
than seventy-five (75) nor less than thirty (30) calendar days prior to the
proposed redemption date.  In the event
of redemption of this Note in part only, a new Note for the unredeemed portion
hereof shall be issued in the name of the Holder hereof upon the surrender
hereof.  If less than all of the Notes
are redeemed, the Depositary will select by lot the amount of the interest of
each direct participant in the Trust to be redeemed.  Unless otherwise specified herein, the Trust may not redeem the
Notes after the date that is thirty (30) days prior to the Stated Maturity
Date.

 

Section 5.  
Sinking Funds and Amortizing Notes.  Unless this Note is specified as an
Amortizing Note on the face hereof, this Note will not be subject to any
sinking fund.

 

Section 6.  
Optional Repayment.  If no repayment right is set forth on the
face hereof, this Note may not be repaid at the option of the Holder hereof
prior to the Stated Maturity Date.  If a
Repayment Right is granted on the face of this Note, this Note may be subject
to repayment at the option of the Holder on any Interest Payment Date on and
after the date, if any, indicated on the face hereof (each, a “Repayment
Date”).  On any Repayment Date, unless
otherwise specified on the face hereof, this Note shall be repayable in whole
or in part in increments of $1,000 at the option of the Holder hereof at a
repayment price equal to 100% of the Principal Amount to be repaid, together
with interest thereon payable to the date of repayment.  For this Note to be repaid in whole or in
part at the option of the Holder hereof, this Note must be received by the
Indenture Trustee, with the form entitled “Option to Elect Repayment,” below,
duly completed by the Indenture Trustee. 
Exercise of such repayment option by the Holder hereof shall be
irrevocable.

 

A-2-22

 

Section 7.  
Modification and Waivers.  The Indenture contains provisions permitting
the Trust and the Indenture Trustee (1) at any time without notice to, or the
consent of, the Holders of any Notes issued under the Indenture to execute
supplemental indentures for certain enumerated purposes and (2) with the
consent of the Holders of not less than a majority in aggregate principal
amount of the Outstanding Notes affected thereby, to execute supplemental
indentures for the purpose of adding any provisions to, or changing in any
manner or eliminating any of the provisions of the Indenture or of modifying in
any manner the rights of Holders of Notes under the Indenture; provided, that,
with respect to certain enumerated provisions, no such supplemental indenture
may be entered into without the consent of the Holder of each Note affected
thereby.  Any such consent or waiver by the
Holder of this Note shall be conclusive and binding upon such Holder and upon
all future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Note or such other Notes.

 

Section 8.  
Obligations Unconditional.  No reference herein to the Indenture and no
provisions of this Note or of the Indenture shall impair the right of each
Holder of any Note, which is absolute and unconditional, to receive payment of
the principal of, and any interest on, such Note on the respective Stated
Maturity Date thereof and to institute suit for the enforcement of any such
payment, and such rights shall not be impaired without the consent of such
Holder.

 

Section 9.  
Events of Default.  If an Event of Default with respect to Notes
of this Series shall occur and be continuing, the principal of the Notes of
this Series may be declared due and payable, or may be automatically
accelerated, as the case may be, in the manner and with the effect provided in
the Indenture.  In the event that this
Note is a Discount Note, the amount of principal of this Note that becomes due
and payable upon such acceleration shall be equal to the amount calculated as
set forth in Section 3(b) hereof.

 

Section 10.  
Withholding; Additional Amounts; Tax Event.  All amounts due on this Note will be made
net of any applicable withholding or deduction for or on account of any present
or future taxes, duties, levies, assessments or other governmental charges of
whatever nature imposed or levied by or on behalf of any governmental
authority, unless such withholding or deduction is required by law.  Unless otherwise specified on the face
hereof, the Trust will not pay any Additional Amounts to the Holders of this
Series of Notes in respect of any such withholding or deduction and any such
withholding or deduction will not give rise to an Event of Default or any
independent right or obligation to redeem the Notes of the Series.  If set forth on the face hereof, in the
event the Trust is required, or based on an opinion of independent legal
counsel selected by Protective Life a material probability exists that the
Trust will be required to pay additional amounts in respect of such withholding
or deduction, Protective Life will have the right to redeem the Funding
Agreement and, if Protective Life redeems the Funding Agreement, the Trust will
redeem this Note at the Redemption Price set forth on the face hereof with no
less than thirty (30) days and no more than seventy-five (75) days notice.

 

If (1) a Tax Event (defined below) as to the relevant Funding
Agreement(s) occurs and (2) Protective Life redeems the Funding Agreement in
whole or in part, the Trust will redeem the Notes, subject to the terms and
conditions of Section 2.04 of the Indenture, at the Tax Event Redemption
Price (defined below) together with unpaid interest accrued thereon to the
applicable redemption date.  “Tax Event”
means that Protective Life shall have received an opinion of

 

A-2-23

 

independent
legal counsel stating in effect that as a result of (a) 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 therefor or therein or (b) any amendment to, or change in, an
interpretation or application of any such laws or regulations by any
governmental authority in the United States, which amendment or change is
enacted, promulgated, issued or announced on or after the date the applicable
Funding Agreement is entered into, there is more than an insubstantial risk
that (i) the Trust is, or will be within ninety (90) days of the date thereof,
subject to U.S. federal income tax with respect to interest accrued or received
on the relevant Funding Agreement or (ii) the Trust is, or will be within
ninety (90) days of the date thereof, subject to more than a de minimis amount
of taxes, duties or other governmental charges.  “Tax Event Redemption Price” means an amount equal to the unpaid
principal amount of this Note to be redeemed. 
The unpaid principal amount of this Note to be redeemed shall be
determined by multiplying (1) the Outstanding Principal Amount of this Note by
(2) the quotient derived by dividing (A) the outstanding principal amount to be
redeemed by Protective Life of the Funding Agreement by (B) the outstanding
principal amount of the Funding Agreement.

 

Section 11.   Listing.  Unless otherwise specified on the face
hereof, this Series of Notes will not be listed on any securities exchange.

 

Section 12.    No Recourse  Against
Certain Persons.  No recourse
shall be had for the payment of the principal of or the interest on this Note,
or for any claim based hereon, or otherwise in respect hereof, or based on or
in respect of the Indenture or any indenture supplemental thereto, against the
Nonrecourse Parties, whether by virtue of any constitution, statute or rule of
law, or by the enforcement of any assessment or penalty or otherwise, all such
personal liability being, by the acceptance hereof and as part of the
consideration for issue hereof, expressly waived and released.

 

Section 13.  
Miscellaneous.

 

(a)           This
Note is issuable only as a registered Note without coupons in denominations of
$1,000 and any integral multiple in excess thereof unless otherwise
specifically agreed between the parties and provided on the face of this Note.

 

(b)           Prior
to due presentment for registration of transfer of this Note, the Trust, the
Indenture Trustee, the Registrar, the Paying Agent, any Agent, and any other
agent of the Trust or the Indenture Trustee may treat the Person in whose name
this Note is registered as the owner hereof for the purpose of receiving
payment as herein provided (subject to Section 2.09 of the Indenture)
and for all other purposes, whether or not this Note be overdue, and none of
the Trust, the Indenture Trustee, the Registrar, the Paying Agent, any Agent,
and any other agent of the Trust or the Indenture Trustee shall be affected by
notice to the contrary.

 

(c)           The
Notes are being issued by means of a book-entry-only system with no physical
distribution of certificates to be made except as provided in the
Indenture.  The book-entry system
maintained by DTC will evidence ownership of the Notes, with transfers of
ownership effected on the records of DTC and its participants pursuant to

 

A-2-24

 

rules and procedures established by DTC and its participants.  The Trust and the Indenture Trustee will
recognize Cede & Co., as nominee of DTC, as the registered owner of the
Notes, as the Holder of the Notes for all purposes, including payment of principal,
premium (if any) and interest, notices and voting.  Transfer of principal, premium (if any) and interest to
participants of DTC will be the responsibility of DTC, and transfer of
principal, premium (if any) and interest to beneficial holders of the Notes by
participants of DTC will be the responsibility of such participants and other
nominees of such beneficial holders.  So
long as the book-entry system is in effect, the selection of any Notes to be
redeemed or repaid will be determined by DTC pursuant to rules and procedures
established by DTC and its participants. 
Neither the Trust nor the Indenture Trustee will not be responsible or
liable for such transfers or payments or for maintaining, supervising or
reviewing the records maintained by DTC, its participants or persons acting
through such participants.

 

(d)           This
Note or portion hereof may not be exchanged for Definitive Notes of this Series
of Notes, except in the limited circumstances provided for in the
Indenture.  The transfer or exchange of
Definitive Notes shall be subject to the terms of the Indenture.  No service charge will be made for any
registration of transfer or exchange, but the Trust may require payment of a
sum sufficient to cover any tax or other governmental charge payable in connection
therewith.

 

Section 14.  
GOVERNING LAW.  THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.

 

A-2-25

 

OPTION TO ELECT REPAYMENT

 

The undersigned hereby irrevocably request(s) and instruct(s) the Trust
to repay this Note (or portion hereof specified below) pursuant to its terms at
a price equal to the Principal Amount hereof together with interest to the
repayment date, to the undersigned, at:

	
   

  
	
   

  
	
   

  
	
   

  
	
  (Please
  print or typewrite name and address of the undersigned).

  

 

For this Note to be repaid, the Indenture Trustee (or the Paying Agent
on behalf of the Indenture Trustee) must receive at its Corporate Trust Office,
or at such other place or places of which the Trust shall from time to time
notify the Holder of this Note, not more than sixty (60) nor less than thirty
(30) days prior to a Repayment Date, if any, shown on the face of this Note,
this Note with this “Option to Elect Repayment” form duly completed.

 

If less than the entire Principal Amount of this Note is to be repaid,
specify the portion hereof (which shall be in increments of $1,000) which the
Holder elects to have repaid and specify the denomination or denominations
(which shall be $            
or an integral multiple of $1,000 in excess of $            )
of the Notes to be issued to the Holder for the portion of this Note not being
repaid (in the absence of any such specification, one such Note will be issued
for the portion not being repaid).

 

	
  $

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  NOTICE: The signature
  on this Option to Elect Repayment must correspond with the name as written
  upon the face of this Note in every particular, without alteration or
  enlargement or any change whatever.

  
	
  DATE:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Registered Face Amount
  to be repaid, if amount to be repaid is less than the Registered Face Amount
  of this Note (Registered Face Amount remaining must be an authorized
  denomination)

  	
   

  	
  Fill in for
  registration of Notes if to be issued otherwise than to the registered Holder:

  
	
   

  	
   

  	
  Name: 

  	
   

  	
   

  
	
  $

  	
   

  	
   

  	
   

  	
  Address:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Please print name and
  address including zip code)

  
												

 

SOCIAL SECURITY OR OTHER TAXPAYER ID NUMBER:                                                  

 

A-2-26

 

SCHEDULE I

 

Amortization Table or
Formula

 

A-2-27

 

EXHIBIT A-3

FORM OF
INSTITUTIONAL DEFINITIVE NOTE

 

	
   

  	
  CUSIP NO.

  	
   

  

 

PROTECTIVE LIFE SECURED TRUST
[     ]-[   ]

SECURED MEDIUM-TERM NOTE

 

	
  REGISTERED FACE AMOUNT:

  	
   

  	
   

  
	
  No.

  	
   

  	
   

  	
   

  	
   

  
					

 

THIS NOTE IS A DEFINITIVE NOTE WITHIN THE MEANING OF THE INDENTURE
(HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME OF THE HOLDER (AS DEFINED
IN THE INDENTURE) THEREOF.  THIS NOTE IS
NOT EXCHANGEABLE FOR A GLOBAL NOTE (AS DEFINED IN THE INDENTURE).

 

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
HOLDER TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR
TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED HOLDER HEREOF HAS AN
INTEREST HEREIN.

 

 

 

Principal
Amount: $                                               

 

(or
principal amount of foreign or composite currency)

 

Original
Issue Date:

 

Price
to Public:

 

Stated
Maturity Date:

 

Settlement
Date and Time:

 

Securities Exchange Listing:  o
Yes  o
No.  If yes, indicate name(s) of
Securities Exchange(s)
                                                           

                                                                 .

 

Authorized Denominations

 

Collateral held in the Trust:  Protective Life Insurance Company Funding
Agreement No. •,
all proceeds, rights and books and records related thereto.

 

Additional
Amounts to be Paid: o  Yes   o  No.

 

Interest
Rate or Formula:

 

Fixed
Rate Note: o  Yes   o  No.  If yes,

 

Interest
Rate:

 

Interest
Payment Frequency:

 

o
Monthly            o Quarterly

 

o Semi-annually  o Annually

 

Additional/Other
Terms:

 

Amortizing
Note: o Yes o
No.  If yes,

 

Amortization
schedule or formula:

 

Additional/Other
Terms:

 

Discount
Note: o Yes o
No.  If yes,

 

Registered
Face Amount:

 

Total
Amount of Discount:

 

Yield
to Maturity:

 

Additional/Other
Terms:

 

Redemption Provisions: o
Yes  o No. 
If yes,

 

Initial
Redemption Date:

 

Initial
Redemption Percentage:

 

Annual
Redemption Percentage Reduction, if any:

 

Additional/Other
Terms:

 

Repayment
Provisions: o Yes  o No. 
If yes,

 

Optional
Repayment Date(s):

 

Additional/Other
Terms:

 

Floating
Rate Note: o Yes o
No.  If yes,

 

Interest
Rate:

 

Interest
Rate Basis(es) (or Base Rate):

 

CD Rate o

 

Commercial Paper Rate o

 

Federal Funds Rate o

 

LIBOR o

 

o LIBOR Reuters Page:

 

o LIBOR Telerate Page:

 

Designated LIBOR Currency:

 

Treasury Rate (other than Constant Maturity
Treasury Rate) o

 

Constant Maturity Treasury Rate o

 

Designated CMT Telerate Page:

 

If Telerate Page 7052:

 

o Weekly Average

 

o Monthly Average

 

Designated CMT Maturity Index:

 

Prime Rate o

 

Other o

 

Other Base Rate:

 

Inverse
Floating Rate Note o

 

Fixed Interest Rate:

 

Floating
Rate/Fixed Rate o

 

Fixed Interest Rate:

 

Fixed Rate Commencement Date:

 

Index
Maturity:

 

Spread
and/or Spread Multiplier, if any:

 

Initial
Interest Rate, if any:

 

Initial
Interest Reset Date:

 

Interest
Reset Dates:

 

Rate
Determination Date(s):

 

Interest
Payment Frequency:

 

o
Monthly              o Quarterly

 

o Semi-Annually   o Annually

 

Maximum
Interest Rate, if any:

 

Minimum
Interest Rate, if any:

 

Additional/Other
Terms:

 

Regular
Record Date(s):

 

Sinking
Fund:

 

Day
Count Convention:

 

Computation
of Interest:

 

o 30 over
360              o Actual over Actual

 

o Actual over
360       o Other
(See attached)

 

Specified
Currency:

 

Exchange
Rate Agent:

 

Calculation
Agent:

 

Additional/Other
Terms:

 

 

The Protective Life Secured Trust designated
above (the “Trust”), for value received, hereby promises to pay to the Holder
hereof, or its registered assigns, the Principal Amount on the Stated Maturity
Date and, if so specified above, to pay interest thereon from the Original
Issue Date specified above or from the most recent Interest Payment Date
specified above to which interest has been paid or duly provided for at the
rate per annum determined in accordance with the provisions on the reverse
hereof and as specified above, until the principal hereof is paid or made
available for payment and (to the extent that the payment of such interest
shall be legally enforceable) at such rate per annum on any overdue principal
and premium and on any overdue installment of interest as specified above.  Unless otherwise specified above, payments
of principal, premium, if any, and interest hereon will be made in U.S.
Dollars, as defined in the Indenture, dated as of the Original Issue Date
specified in the Pricing Supplement (the “Indenture”),
between The Bank of New York (the “Indenture
Trustee”) and the Trust. 
If the Specified Currency set forth above is a currency other than U.S.
Dollars, the Holder shall receive such payments in such Foreign Currency (as
hereinafter defined).  The “Principal
Amount” of this Note at any time means (1) if this Note is a Discount Note (as
hereinafter defined), the Amortized Face Amount (as hereinafter defined) at
such time (as defined in Section 3(b) on the reverse hereof) and (2) in
all other cases, the Registered Face Amount hereof.  Capitalized terms not otherwise defined herein shall have their meanings
set forth in the Indenture or on the face hereof.

 

This Note will mature on the Stated Maturity
Date, unless its principal (or, any installment of its principal) becomes due
and payable prior to the Stated Maturity Date whether, as applicable, by the
declaration of acceleration of maturity, notice of redemption at the direction
of the Trust, notice of the Holder’s option to elect repayment or otherwise
(the Stated Maturity Date or any date prior to the Stated Maturity Date on
which the principal amount of this Note becomes due and payable, as the case
may be, are referred to as the “Maturity Date” with respect to principal of
this Note repayable on such date).

 

A “Discount Note” is any Note that has an
Issue Price that is less than 100% of the Registered Face Amount thereof by
more than a percentage equal to the product of 0.25% and the number of full
years to the Stated Maturity Date.

 

Except as provided in the following
paragraph, the Trust will pay interest on each Interest Payment Date specified
above, commencing with the first (1st) Interest Payment Date next
succeeding the Original Issue Date, and on the Maturity Date; provided that any payment of principal,
premium, if any, or interest to be made on any Interest Payment Date or on a
Maturity Date that is not a Business Day (or, if this Note is a LIBOR Note (as
defined in Section 3(d)(v)(D) on the reverse hereof), a day that is also
not a London Business Day (as hereinafter defined)) shall be made on the next
succeeding Business Day (or, if this Note is a LIBOR Note, on the next
succeeding Business Day that is also a London Business Day) with the same force
and effect as if made on such Interest Payment Date or such Maturity Date, as
the case may be, except that with respect to Interest Payment Dates, other than
the Maturity Date, if this Note is a LIBOR Note and such next succeeding
Business Day that is also a London Business Day falls in the next calendar
month, such payment shall be made on the Business Day that is also a London
Business Day immediately preceding the Interest Payment Date; provided that, in connection with Floating
Rate Notes, and except in the case of an Interest Payment Date that falls on a
Maturity Date, interest will continue to accrue to but excluding the date the
interest is paid.  The term “London Business Day” means a day other
than a Saturday or Sunday on which dealings

 

A-3-3

 

in deposits in U.S. Dollars are transacted, or with respect to any
future date are expected to be transacted in the London interbank market.  Unless otherwise specified above, the
interest payable on each Interest Payment Date or the Maturity Date will be the
amount of interest accrued from and including the Original Issue Date or from
and including the last Interest Payment Date to which interest has been paid or
duly provided for, as the case may be, to, but excluding, such Interest Payment
Date or the Maturity Date, as the case may be.

 

Unless otherwise specified above, the
interest payable on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Note (or one or more
predecessor Notes) is registered at the close of business on the Regular Record
Date for such Interest Payment Date, which Regular Record Date shall be the
fifteenth (15th) calendar day, whether or not a Business Day,
immediately preceding the related Interest Payment Date; provided that, notwithstanding any
provision of the Indenture to the contrary, interest payable on any Maturity
Date shall be payable to the Person to whom principal shall be payable; and provided, further, that unless otherwise
specified above, in the case of a Note initially issued between a Regular
Record Date and the Interest Payment Date relating to such Regular Record Date,
interest for the period beginning on the Original Issue Date and ending on such
Interest Payment Date shall be paid on the Interest Payment Date following the
next succeeding Regular Record Date to the registered Holder on such next
succeeding Regular Record Date.

 

Payments of interest hereon (other than on
the Maturity Date) will be made by wire transfer of by check mailed to the
registered Holder of this Note.  A
Holder of $10,000,000, or its equivalent in a Specified Currency other than
U.S. Dollars, or more in aggregate principal amount of Definitive Notes will be
entitled to receive payments by wire transfer in immediately available funds, provided that the Indenture Trustee has
received from the Holder written, appropriate wire transfer instructions not
later than five (5) Business Days prior to the applicable Interest Payment
Date. Unless otherwise specified on the face hereof, any principal, premium
and/or interest payable hereon on the Maturity Date will be paid in immediately
available funds upon surrender of this Note at the Corporate Trust Office of
the Indenture Trustee, provided
that this Note is presented to the Indenture Trustee (or any such Paying Agent)
in time for the Indenture Trustee (or the Paying Agent) to make such payments in
such funds in accordance with its normal procedures.

 

Unless otherwise specified on the face
hereof, the Holder hereof will not be obligated to pay any administrative costs
imposed by banks in making payments in immediately available funds by the
Trust.  Unless otherwise specified on
the face hereof, any tax assessment or governmental charge imposed upon
payments hereunder, including, without limitation, any withholding tax, will be
borne by the Holder thereof.

 

REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS
OF THIS NOTE SET FORTH ON THE REVERSE HEREOF. 
SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS
IF SET FORTH AT THIS PLACE.

 

Unless the certificate of authentication
hereon shall have been executed by the Indenture Trustee pursuant to the
Indenture, this Note shall not be entitled to any benefit under such Indenture
or be valid or obligatory for any purpose.

 

A-3-4

 

IN WITNESS WHEREOF, the Trust has caused this
instrument to be duly executed, by manual or facsimile signature.

 

 

	
   

  	
  THE PROTECTIVE LIFE SECURED TRUST

  SPECIFIED ON THE FACE OF THIS NOTE

  
	
   

  
	
  Dated: Original Issue Date

  	
   

  	
  By: Wilmington Trust Company, not in its individual

  capacity but solely as Delaware Trustee.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
					

 

 

CERTIFICATE OF AUTHENTICATION

 

This is one of the Notes of the Protective
Life Secured Trust specified on the face of this Note referred to in the
within-mentioned Indenture.

 

 

	
   

  	
  THE BANK OF NEW YORK

  
	
   

  	
  As Indenture Trustee

  
	
   

  	
   

  
	
  Dated: Original Issue Date

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  

 

A-3-5

 

[REVERSE OF NOTE]

 

Section 1.  
General.  This Note is one of a duly authorized issue of Notes of the
Protective Life Secured Trust designated on the face hereof (the “Trust”).  The Series of Notes are issued pursuant to
the Indenture.  Capitalized terms not
otherwise defined herein shall have their meanings set forth in the Indenture.

 

Section 2.  
Currency.

 

(a)           Unless specified
otherwise on the face hereof, this Note is denominated in, and payments of
principal, premium, if any, and/or interest, if any, will be made in U.S.
Dollars.  If specified as the Specified
Currency on the face hereof this Series of Notes may be denominated in, and
payments of principal, premium, if any, and/or interest, if any, may be made in
a currency other than U.S. Dollars (a “Foreign Currency”).  If this Note is denominated in a Foreign
Currency, the Holder of this Note is required to pay for this Note in the
Specified Currency indicated on the face hereof.

 

(b)           Unless otherwise
specified on the face hereof, if payment hereon is required to be made in a
Foreign Currency and such currency is unavailable to the Trust for making
payments thereof due to the imposition of exchange controls or other
circumstances beyond the Trust’s control, or is no longer used by the
government of the country which issued such currency or for the settlement of
transactions by public institutions of or within the international banking
community, then the Trust will be entitled to make payments with respect hereto
in U.S. Dollars until such Foreign Currency is again available or so used.  The amount so payable on any date in such
Foreign Currency shall be converted into U.S. Dollars at a rate determined by
the Exchange Rate Agent on the basis of the noon buying rate in The City of New
York for cable transfers in the Foreign Currency as certified for customs
purposes by the Federal Reserve Bank of New York (the “Market Exchange Rate”)
for such Foreign Currency on the second (2nd) Business Day prior to
such payment date, or on such other basis as may be specified on the face
hereof.  In the event such Market
Exchange Rate is not then available, the Trust will be entitled to make
payments in U.S. Dollars (1) if such Foreign Currency is not a composite
currency, on the basis of the most recently available Market Exchange Rate for
such Foreign Currency or (2) if such Foreign Currency is a composite currency,
including, without limitation, euros, in an amount determined by the Exchange
Rate Agent to be the sum of the results obtained by multiplying the number of
units of each component currency of such composite currency, as of the most
recent date on which such composite currency was used, by the Market Exchange
Rate for such component currency on the second (2nd) Business Day
prior to such payment date (or if such Market Exchange Rate is not then
available, by the most recently available Market Exchange Rate for such
component currency, or as otherwise specified on the face hereof).  Any payment in respect hereof made under
such circumstances in U.S. Dollars will not constitute an Event of Default
under the Indenture.

 

A-3-6

 

(c)           If the official unit
of any component currency of a composite currency is altered by way of
combination or subdivision, the number of units of that currency as a component
shall be divided or multiplied in the same proportion.  If two or more component currencies are
consolidated into a single currency, the amounts of those currencies as
components shall be replaced by an amount in such single currency equal to the
sum of the amounts of the consolidated component currencies expressed in such
single currency.  If any component
currency is divided into two or more currencies, the amount of that original
component currency as a component shall be replaced by amounts of such two or
more currencies having an aggregate value on the date of division equal to the
amount of the former component currency immediately before such division.

 

(d)           In the event of an
official redenomination of the Specified Currency (including, without
limitation, an official redenomination of any such currency that is a composite
currency), the obligations of the Trust to make payments in or with reference
to such currency shall, in all cases, be deemed immediately following such
redenomination to be obligations to make payments in or with reference to that
amount of redenominated currency representing the amount of such currency immediately
before such redenomination.  In no event
shall any adjustment be made to any amount payable hereunder as a result of (1)
any redenomination of any component currency of any composite currency (unless
such composite currency is itself officially redenominated) or (2) any change
in the value of the specified currency relative to any other currency due
solely to fluctuations in exchange rates.

 

(e)           All determinations
referred to above made by the Exchange Rate Agent shall be at its sole
discretion (except to the extent expressly provided herein that any
determination is subject to approval by the Trust or the Administrator) and, in
the absence of manifest error, shall be conclusive for all purposes and binding
on the Trust, the Indenture Trustee and the Holder hereof, and the Exchange
Rate Agent shall have no liability therefor.

 

(f)            All
currency exchange costs will be borne by the Holder hereof by deduction from
the payments made hereon.

 

Section 3.  
Determination of Interest Rate and Certain Other Terms.

 

(a)           Fixed
Rate Notes.

 

(i)                            If
this Note is specified on the face hereof as a “Fixed Rate Note,” for the
period from the Original Issue Date, or from the last Interest Payment Date to
which interest has been paid or duly provided for, as the case may be, the
interest rate hereon shall be at the rate per annum stated on the face hereof
until, but excluding the date on which the Principal Amount is paid or made
available for payment.  Unless otherwise
specified on the face hereof, the rate of interest payable on this Note will
not be adjusted.

 

A-3-7

 

(ii)                           Unless
otherwise specified on the face hereof, the Interest Payment Dates for a Note
that provides for monthly interest payments shall be the fifteenth (15th)
day of each calendar month, beginning in the first (1st) calendar
month following the month in which the Note was issued; in the case of a Note
that provides for quarterly interest payments, the Interest Payment Dates shall
be the fifteenth (15th) day of every third (3rd) calendar
month, beginning in the third (3rd) calendar month following the
month in which the Note was issued; in the case of a Note that provides for
semi-annual interest payments, the Interest Payment Dates shall be the
fifteenth (15th) day of every sixth (6th) calendar month,
beginning in the sixth (6th) calendar month following the month in
which the Note was issued; and in the case of a Note that provides for annual
interest payments, the Interest Payment Date shall be the fifteenth (15th)
day of every twelfth calendar month, beginning in the twelfth (12th)
calendar month following the month in which the Note was issued.  Interest will be computed on the basis of a
360-day year of twelve 30-day months or, in the case of an incomplete month,
the number of days elapsed.

 

(b)           Discount
Notes.

 

(i)            If this Note is
specified on the face hereof as a “Discount Note,” this Note shall bear
interest at the rate set forth on the face hereof in the same manner as set
forth in Section 3(a) above, and payments of principal and interest
shall be made as set forth on the face hereof.

 

(ii)           In the event a Discount Note is
redeemed, repaid or accelerated, the amount payable to the Holder of such Note
on the Maturity Date will be equal to the sum of (1) the Issue Price (increased
by any accruals of Discount) and, in the event of any redemption of Discount
Notes, if applicable, multiplied by the Initial Redemption Percentage (as
adjusted by the Annual Redemption Percentage Reduction, if applicable); and (2)
any unpaid interest accrued on such Discount Notes to the Maturity Date (the
“Amortized Face Amount”).  For purposes
of determining the amount of Discount that has accrued as of any date on which
a redemption, repayment or acceleration of this Note occurs for Discount Notes,
the Discount will be accrued using a Constant Yield Method.  The Constant Yield Method will be calculated
using a 30-day month, 360-day year convention, a compounding period that,
except for the Initial Period (as defined below), corresponds to the shortest
period between Interest Payment Dates for the Discount Notes (with ratable
accruals within a compounding period), a coupon rate equal to the initial
coupon rate applicable to the applicable Discount Notes and an assumption that the
Stated Maturity Date of such Discount Notes will not be accelerated.  If the period from the Original Issue Date
to the first (1st) Interest Payment Date for Discount Notes (the
“Initial Period”) is shorter than the compounding period for such Discount Notes,
a proportionate amount of the yield for an entire compounding period will be
accrued.  If the Initial Period is
longer than the compounding period, then the period will be divided into a
regular compounding period and a short period with the short period being
treated as provided above.

 

A-3-8

 

(c)           Amortizing
Notes.

 

(i)            If this Note is
specified on the face hereof as an “Amortizing Note,” this Note shall bear
interest at the rate set forth on the face hereof, in the same manner as set
forth in Section 3(a) above and payments of principal, premium (if any)
and interest shall be made as set forth on the face hereof and/or in accordance
with Schedule  I attached
hereto.

 

(ii)           If it is specified
on the face hereof that this Note is an Amortizing Note, the Trust will make
payments combining principal, premium (if any) and interest, if applicable, on
the dates and in the amounts set forth in the table, or in accordance with the
formula, appearing in Schedule I, attached to this Note.  If this Note is an Amortizing Note, payments
made hereon will be applied first to interest due and payable on each such
payment date and then to the reduction of the Outstanding Face Amount.  The term “Outstanding Face Amount” means, at
any time, the amount of unpaid principal hereof at such time.

 

(d)           Floating
Rate Notes.

 

(i)            If this Note is specified on the
face hereof as a “Floating Rate Note,” interest on this Note shall accrue and
be payable in accordance with this Section 3(d).  A Floating Rate Note may be a CD Rate Note,
Commercial Paper Rate Note, Federal Funds Rate Note, LIBOR Note, Treasury Rate
Note, Constant Maturity Treasury Rate Note, a Prime Rate Note, an Inverse
Floating Rate Note or a Floating Rate/Fixed Rate Note.  For the period from the Original Issue Date
to, but not including, the first (1st) Interest Reset Date set forth
on the face hereof, the interest rate hereon shall be the Initial Interest Rate
specified on the face hereof. 
Thereafter, the interest rate hereon will be reset as of and be
effective as of each Interest Reset Date; provided,
however, that the interest rate in effect for the ten (10) days
immediately prior to the Maturity Date will be that in effect on the tenth (10th)
day preceding such Maturity Date.

 

(A)          Unless specified
otherwise on the face hereof, Interest Reset Dates are as follows:  (1) in the case of Notes that reset daily,
each Business Day, (2) in the case of Notes that reset weekly, other than
Treasury Rate Notes, the Wednesday of each week, (3) in the case of Treasury
Rate Notes that reset weekly and except as provided below under “Treasury Rate
Notes,” the Tuesday of each week, (4) in the case of Notes that reset monthly,
the fifteenth (15th) day of each calendar month, beginning in the
first (1st) calendar month following the month in which the Note was
issued, (5) in the case of Notes that reset quarterly, the fifteenth (15th)
day of every third (3rd) calendar month, beginning in the third (3rd)
calendar month following the month in which the Note was issued, (6) in the
case of Notes that reset semiannually, the fifteenth (15th) day of
every sixth (6th) calendar month, beginning in the sixth (6th)
calendar month following the month in which the Note was issued and (7)

 

A-3-9

 

in the case of Notes that reset annually, the fifteenth (15th)
day of every twelfth (12th) calendar month, beginning in the twelfth
(12th) calendar month following the month in which the Note was
issued.

 

(B)           If any Interest Reset Date would
otherwise be a day that is not a Business Day (or, if this Note is a LIBOR
Note, a day or Business Day that is not a London Business Day), such Interest
Reset Date shall be postponed to the next day that is also a Business Day (or,
if this Note is a LIBOR Note, to the next Business Day that is a London
Business Day); provided, however,
that if this Note is a LIBOR Note and such Business Day that is also a London
Business Day is in the next succeeding calendar month, such Interest Reset Date
shall be the Business Day that is also a London Business Day immediately
preceding such Reset Date.  If this Note
is a Treasury Rate Note (as defined below) and an auction date for direct
obligations of United States securities shall fall on any Interest Reset Date,
then such Interest Reset Date shall instead be the first (1st)
Business Day immediately following such auction date.

 

(C)           If this Note has
more than one Interest Reset Date, accrued interest will be calculated by
multiplying the Principal Amount of the Note specified on the face hereof by an
Accrued Interest Factor.  The Accrued
Interest Factor will be computed by adding the interest factors calculated for
each day in the Interest Reset Period for which accrued interest is being calculated.  The Interest Reset Period is the period from
each Interest Reset Date to, but not including, the following Interest Reset
Date.  Unless otherwise specified on the
face hereof, the Interest Factor for each such day will be computed by dividing
the interest rate in effect on that day by 360, in the case of CD Rate Notes,
Commercial Paper Rate Notes, Federal Funds Rate Notes, LIBOR Notes and Prime
Rate Notes.  In the case of Treasury
Rate Notes and Constant Maturity Treasury Rate Notes, the Interest Factor for
each such day will be computed by dividing the interest rate by the actual
number of days in the year.  The
Interest Rate Basis shall be set forth on the face hereof and shall be the
Interest Rate Basis, as adjusted in accordance with any Spread or Spread
Multiplier and subject to any Maximum Interest Rate or Minimum Interest Rate
specified on the face hereof. 
Notwithstanding Section 3(d)(i)(E) below, the Interest Factor
will be expressed as a decimal calculated to seven decimal places without rounding.  For purposes of making the foregoing
calculation, the interest rate in effect on any Interest Reset Date will be the
applicable rate as reset on that date. 
Unless otherwise specified on the face hereof, the interest rate that is
effective on the applicable Interest Reset Date will be determined on the
applicable Rate Determination Date and calculated on the applicable Calculation
Date.  Unless otherwise specified on the
face hereof, the interest rate in effect for each day to and excluding the next
Interest Reset Date will be the interest rate that was in effect on the
preceding Interest Reset Date. 
“Calculation Date” means the date by which the Calculation Agent
specified on the face hereof, is to calculate

 

A-3-10

 

the interest rate which will be the earlier of (1) the fifth (5th)
Business Day after the related Rate Determination Date, or if any such day is
not a Business Day, the next Business Day and (2) the Business Day preceding
the applicable Interest Payment Date or the Maturity Date.

 

(D)          If this Note has one
Interest Reset Date, accrued interest will be calculated by multiplying the
Principal Amount of the Note specified on the face hereof by the interest rate
in effect during the period for which accrued interest is being
calculated.  That product is then
multiplied by the quotient obtained by dividing the number of days in the
period for which accrued interest is being calculated by 360, in the case of CD
Rate Notes, Commercial Paper Rate Notes, Federal Funds Rate Notes, LIBOR Notes
and Prime Rate Notes.  In the case of
Treasury Rate Notes and Constant Maturity Treasury Rate Notes, the product is
multiplied by the quotient obtained by dividing the number of days in the
period for which accrued interest is being calculated by the actual number of
days in the year.

 

(E)           Unless otherwise
specified on the face hereof, all percentages resulting from any calculation of
the interest rate on this Note will be rounded, if necessary, to the nearest
1/100,000 of 1% (.0000001), with five one-millionths of a percentage point
rounded upward.  All currency amounts
used in, or resulting from, the calculation on a Floating Rate Note will be
rounded to the nearest one-hundredth of a unit.  For purposes of such rounding, .005 of a unit will be rounded
upward.

 

(ii)           Unless otherwise specified on the
face hereof and except as provided below, interest will be payable as follows:
(1) if the Reset Date for a Note is daily, weekly or monthly, interest will be
payable on the fifteenth (15th) day of each calendar month,
beginning in the first (1st) calendar month following the month in
which the Note was issued, (2) if the Reset Date for a Note is quarterly,
interest will be payable on the fifteenth (15th) day of every third
(3rd) calendar month, beginning in the third (3rd)
calendar month following the month in which the Note was issued, (3) if the
Reset Date for a Note is semiannually, interest will be payable on the
fifteenth (15th) day of every sixth (6th) calendar month,
beginning in the sixth (6th) calendar month following the month in
which the Note was issued, (4) if the Reset Date for a Note is annually,
interest will be payable on the fifteenth (15th) day of every
twelfth (12th) calendar month, beginning in the twelfth (12th)
calendar month following the month in which the Note was issued.  In each of these cases, interest will also
be payable on the Maturity Date.

 

(iii)          If specified on the
face hereof, this Note may have either or both of a Maximum Interest Rate or
Minimum Interest Rate.  If a Maximum
Interest Rate is so designated, the interest rate for a Floating Rate Note
cannot ever exceed such Maximum Interest Rate and in the event that the
interest rate on any Interest Reset Date would exceed such Maximum Interest
Rate (as if no Maximum Interest Rate were in effect) then the interest rate on
such Reset Date shall be the Maximum Interest Rate.  If a Minimum Interest Rate is so designated, the interest rate
for a

 

A-3-11

 

Floating Rate Note cannot ever be less than such Minimum Interest Rate
and in the event that the interest rate on any Interest Reset Date would be
less than such Minimum Interest Rate (as if no Minimum Interest Rate were in
effect) then the interest rate on such Reset Date shall be the Minimum Interest
Rate.  Notwithstanding anything to the
contrary contained herein, the interest rate on a Floating Rate Note shall not
exceed the maximum interest rate permitted by applicable law.

 

(iv)          All determinations
of interest by the Calculation Agent will, in the absence of manifest error, be
conclusive for all purposes and binding on the Trust, the Indenture Trustee and
the Holder of this Note and neither the Trust, the Indenture Trustee nor the
Calculation Agent shall have any liability to the Holder of this Note in
respect of any determination, calculation, quote or rate made or provided by
the Calculation Agent.  Upon request of
the Holder of this Note, the Calculation Agent will provide the interest rate then
in effect and, if determined, the interest rate that will become effective on
the next Interest Reset Date with respect to this Note.  The Calculation Agent will notify the
Indenture Trustee, Paying Agent, Registrar, the Trust and if this Note is listed
on a stock exchange, and the rules of such exchange so require, such exchange
of each determination of the interest rate, Initial Interest Period, Interest
Reset Period, and interest amount payable applicable to this Note promptly
after such determination is made.  If
the Calculation Agent is incapable or unwilling to act as such or if the
Calculation Agent fails duly to establish the interest rate for any interest
accrual period or to calculate the interest amount or any other requirements,
the Trust will appoint the Paying Agent or another leading commercial bank to
act as such in its place.

 

(v)           Subject to applicable provisions of
law and except as specified herein, on each Interest Reset Date, the rate of
interest on this Note on and after the first (1st) Interest Reset
Date shall be the interest rate determined in accordance with the provisions of
the heading below which has been designated as the Interest Rate Basis on the
face hereof, the base rate, plus or minus the Spread, if any, specified on the
face hereof and/or multiplied by the Spread Multiplier, if any, specified on
the face hereof.

 

(A)          CD Rate Notes.  If the Interest Rate Basis is the CD Rate,
this Note shall be deemed to be a “CD Rate Note.” A CD Rate Note will bear
interest at the interest rate calculated with reference to the CD Rate and the
Spread or Spread Multiplier, if any. 
The Calculation Agent will determine the CD Rate for each CD Rate
Determination Date by the Calculation Date pertaining to such CD Rate
Determination Date.  The CD Rate
Determination Date is the second (2nd) Business Day prior to the
Interest Reset Date for each Interest Reset Period.  Unless otherwise specified on the face hereof, “CD Rate” means
the rate for negotiable certificates of deposit having the Index Maturity
specified on the face hereof as published in H.15(519) under the heading “CDs
(Secondary Market)” or, if not so published by 3:00 p.m., New York City time,
on the Calculation Date pertaining to such CD Rate Determination Date, the CD

 

A-3-12

 

Rate for the Interest Reset Period will be the rate on such date for
negotiable certificates of deposit of the applicable Index Maturity as
published in the H.15 Daily Update under the heading “CDs (Secondary Market).”  If such rate is not yet published in either
H.15(519) or the H.15 Daily Update by 3:00 p.m., New York City time, on such
Calculation Date, then the CD Rate will be the arithmetic mean of the secondary
market offered rates as of 3:00 p.m., New York City time, on such date, of
three (3) leading nonbank dealers in negotiable U.S. Dollar certificates of
deposit in New York City selected by the Calculation Agent after consultation
with the Trust for negotiable certificates of deposit of major United States
money center banks of the highest credit standing (in the market for negotiable
certificates of deposit) with a remaining maturity closest to the applicable
Index Maturity in a denomination of $5,000,000; provided, however, that if the dealers selected as aforesaid
by the Calculation Agent are not quoting as mentioned above, the CD Rate for
the applicable Interest Reset Period will be the CD Rate for the immediately
preceding Interest Reset Period.  If
there was no such Interest Reset Period, the CD Rate shall be the Initial
Interest Rate.  “H.15(519)” means the
publication entitled “Statistical Release H.15(519), Selected Interest Rates,”
or any successor publication, published weekly by the Board of Governors of the
Federal Reserve System; and “H.15 Daily Update” means the daily update of the
Board of Governors of the Federal Reserve System at
http://www.federalreserve.gov/releases/h15/update/, or any successor site or
publication.

 

(B)           Commercial Paper Rate Notes.  If the Interest Rate Basis is the Commercial
Paper Rate, this Note shall be deemed to be a “Commercial Paper Rate Note.” A
Commercial Paper Rate Note will bear interest for each Interest Reset Period at
the interest rate calculated with reference to the Commercial Paper Rate and
the Spread or Spread Multiplier, if any. 
The Calculation Agent will determine the Commercial Paper Rate for each
Commercial Paper Rate Determination Date by the Calculation Date pertaining to
such Commercial Paper Rate Determination Date. 
The Commercial Paper Rate Determination Date is the second (2nd)
Business Day prior to the Interest Reset Date for each Interest Reset Date for
each Interest Reset Period.  Unless
otherwise specified on the face hereof, “Commercial Paper Rate” means the Money
Market Yield (calculated as described below) on the Calculation Date of the
rate for commercial paper having the Index Maturity specified on the face
hereof as such rate is published in H.15(519) under the heading “Commercial
Paper — Nonfinancial.”  If such rate is
not published by 3:00 p.m., New York City time, on the Calculation Date
pertaining to such Commercial Paper Rate Determination Date, then the
Commercial Paper Rate for the Interest Reset Period shall be the Money Market
Yield of the rate on such date for commercial paper having the applicable Index
Maturity as published in the H.15 Daily Update or such other recognized
electronic source used for the purpose of displaying such rate, under the
heading “Commercial Paper — 

 

A-3-13

 

Nonfinancial.”  If such rate is
not yet published in either H.15(519) or H.15 Daily Update or such other
recognized electronic source used for the purpose of displaying this rate, by
3:00 p.m., New York City time, on such Calculation Date, then the Commercial
Paper Rate for the Interest Reset Period shall be the Money Market Yield of the
arithmetic mean of the offered rates, as of 3:00 p.m., New York City time, on
such date, of three (3) leading dealers of commercial paper in New York City
selected by the Calculation Agent after consultation with the Trust for
commercial paper having the applicable Index Maturity placed for an industrial
issuer whose bond rating is “AA” or the equivalent, from a nationally
recognized securities rating agency; provided,
however, that if the dealers selected by the Calculation Agent are
not quoting offered rates as mentioned above, the Commercial Paper Rate for the
Interest Reset Period will be the same as the Commercial Paper Rate for the
immediately preceding Interest Reset Period. 
If there was no such Interest Reset Period, the Commercial Paper Rate
will be the Initial Interest Rate. 
“Money Market Yield” shall be a yield calculated in accordance with the
following formula:

 

Money Market Yield =         D
X 360           x          100

                                         360
- (D X M)

 

where “D” refers to the per annum rate for
commercial paper quoted on a bank discount basis and expressed as a decimal;
and “M” refers to the actual number of days in the applicable Index Maturity.

 

(C)           Federal Funds
Rate Notes.  If the Interest Rate
Basis is the Federal Funds Rate, this Note shall be deemed to be a “Federal
Funds Rate Note.” A Federal Funds Rate Note will bear interest for each
Interest Reset Period at the interest rate calculated with reference to the
Federal Funds Rate and the Spread or Spread Multiplier, if any.  The Calculation Agent will determine the
Federal Funds Rate for each Federal Funds Rate Determination Date by the Calculation
Date pertaining to such Federal Funds Rate Determination Date.  The Federal Funds Rate Determination Date is
the second (2nd) Business Day prior to the Interest Reset Date for
each Interest Reset Period.  Unless
otherwise specified on the face hereof, “Federal Funds Rate” means the rate for
Federal Funds as published in H.15(519) under the heading “Federal Funds
(Effective),” as this rate is displayed on Moneyline Telerate, Inc. on page
120, or any successor service or page (“Telerate Page 120”) or, if not so
displayed or published by 3:00 p.m., New York City time, on the Calculation
Date pertaining to such Rate Determination Date, the Federal Funds Rate for the
Interest Reset Period will be the rate on such Calculation Date as published in
the H.15 Daily Update, or another recognized electronic source used for the
purpose of displaying this rate, under the heading “Federal Funds
(Effective).”  If such rate is not yet
published in either H.15(519), H.15

 

A-3-14

 

Daily Update or another recognized electronic source used for the
purpose of displaying this rate by 3:00 p.m., New York City time, on the
Calculation Date then the Federal Funds Rate for such Interest Reset Period
will be the arithmetic mean of the rates, as of 3:00 p.m., New York City time,
on the Calculation Date, for the last transaction in overnight Federal Funds
arranged by three (3) leading brokers of Federal Funds transactions in New York
City selected by the Calculation Agent after consultation with the Trust.  If the dealers selected by the Calculation
Agent, however, are not quoting rates as described above, the Federal Funds
Rate for the Interest Reset Period will be the same as the Federal Funds Rate
in effect for the immediately preceding Interest Reset Period.  If there was no such Interest Reset Period,
the Federal Funds Rate will be the Initial Interest Rate.

 

If this Note is a Federal Funds Rate Note
that resets daily, the interest rate on the Note for the period from and
including a Monday to, but excluding, the succeeding Monday will be reset by
the Calculation Agent on the second (2nd) Monday, or, if not a
Business Day, on the next Business Day, to a rate equal to the average of the
Federal Funds Rates in effect for each such day in such week.

 

(D)          LIBOR Notes.  If the Interest Rate Basis is LIBOR, this
Note shall be deemed to be a “LIBOR Note.” A LIBOR Note will bear interest for
each Interest Period at the interest rate calculated with reference to LIBOR
and the Spread or Spread Multiplier, if any. 
The Calculation Agent will determine LIBOR for each LIBOR Determination
Date by the Calculation Date pertaining to such LIBOR Determination Date.  The LIBOR Determination Date is the second
(2nd) London Business Day prior to the Interest Reset Date for each
Interest Reset Period.

 

(1)           Unless otherwise
indicated on the face hereof, on a LIBOR Determination Date, the Calculation
Agent will determine LIBOR for each Interest Reset Period as follows:

 

The Calculation Agent will determine the
offered rates for deposits in U.S. Dollars for the period of the Index Maturity
specified on the face hereof, commencing on the Interest Reset Date, which
appears on the “designated LIBOR page” as of 11:00 a.m., London time, on that
LIBOR Determination Date.  If “LIBOR
Telerate” is designated on the face hereof, “designated LIBOR page” means the
display on Moneyline Telerate, Inc. on page 3750, or any successor service or
page for the purpose of displaying the London interbank offered rates of major
banks.  If “LIBOR Reuters” is designated
on the face hereof, “designated LIBOR page” means the arithmetic mean
determined by the Calculation Agent of the two (2) or more offered rates
(unless the designated LIBOR page by its terms provides only for a single rate,
in which case such

 

A-3-15

 

single rate shall be used) on the display on
the Reuters Monitor Money Rates Service Page “LIBOR,” or any successor service
or page for the purpose of displaying the London interbank offered rates of
major banks.  If neither “LIBOR
Telerate” nor “LIBOR Reuters” is specified on the face hereof, LIBOR will be
determined as if LIBOR Telerate had been specified.

 

(2)           If LIBOR cannot be
determined on a LIBOR Determination Date as described above, then the
Calculation Agent will determine LIBOR as follows:

 

The Calculation Agent will select four (4)
major banks in the London interbank market after consultation with the
Trust.  The Calculation Agent will
request that the principal London offices of those four (4) selected banks
provide their offered quotations to prime banks in the London interbank market
at approximately 11:00 a.m., London time, on the LIBOR Determination Date.  These quotations will be for deposits in
U.S. Dollars for the period of the Index Maturity specified on the face hereof,
commencing on the Interest Reset Date. 
Offered quotations must be based on a principal amount equal to an
amount that is representative of a single transaction in U.S. Dollars in the
market at the time.  If two (2) or more
quotations are provided, LIBOR for the Interest Reset Period will be the
arithmetic mean of the quotations.  If
fewer than two (2) quotations are provided, the Calculation Agent will select
three (3) major banks in New York City after consultation with the Trust and
then determine LIBOR for the Interest Reset Period as the arithmetic mean of
rates quoted by those three (3) major banks in New York City to leading
European banks at approximately 3:00 p.m., New York City time, on the LIBOR
Determination Date.  The rates quoted
will be for loans in U.S. Dollars, for the period of the Index Maturity
specified on the face hereof, commencing on the Interest Reset Date.  Rates quoted must be based on a principal
amount equal to an amount that is representative of a single transaction in
U.S. Dollars in the market at the time. 
If fewer than three (3) New York City banks selected by the Calculation
Agent are quoting rates, LIBOR for the Interest Reset Period will be the same
as LIBOR for the immediately preceding Interest Reset Period.  If there was no such Interest Reset Period,
LIBOR will be the Initial Interest Rate.

 

(E)           Treasury Rate
Notes.

 

(1)           If the Interest Rate
Basis is the Treasury Rate, this Note shall be deemed to be a “Treasury Rate
Note.” A Treasury Rate Note will bear interest for each Interest Reset Period
at the interest rate calculated with reference to the Treasury Rate and the
Spread

 

A-3-16

 

or Spread Multiplier, if any. 
The Calculation Agent will determine the Treasury Rate for each Treasury
Rate Determination Date by the Calculation Date pertaining to such Treasury
Rate Determination Date.  Unless
“Constant Maturity Treasury Rate” is specified on the face hereof and unless
otherwise set forth on the face hereof, the Treasury Rate for each Interest
Reset Period will be the rate for the auction held on the Treasury Rate
Determination Date for the Interest Reset Period of U.S. treasury securities
having the Index Maturity specified on the face hereof as that rate appears on
the display on Moneyline Telerate, Inc. (or any successor service) on page 56
(or any other page as may replace this page on that service) under the heading
“Investment Rate” or, if not so published by 3:00 p.m., New York City time, on
such Calculation Date pertaining to the Treasury Rate Determination Date, then
the Treasury Rate for the Interest Reset Period will be the auction average
rate (expressed as a bond equivalent on the basis of a year of 365 or 366 days,
as applicable, and applied on a daily basis) on such Treasury Rate
Determination Date as otherwise announced by the United States Department of
the Treasury.  In the event that the
results of the auction are not published or reported as provided above by 3:00
p.m., New York City time, on such Calculation Date, or if no such auction is
held on such Treasury Rate Determination Date, then the Treasury Rate for such
Interest Reset Period shall be the rate having the Index Maturity specified on
the face hereof as published in H.15(519) under the heading “U.S. Government
Securities—Treasury bills (Secondary Market)” or, if not published by 3:00
p.m., New York City time, on the Calculation Date, the rate on the Treasury
Rate Determination Date of treasury securities as published in H.15 Daily
Update, or another recognized electronic source used for the purpose of
displaying that rate, under the heading “U.S. Government Securities—Treasury
Bills (Secondary Market).”  If none of
the above rates is published by 3:00 p.m., New York City time on the
Calculation Date, then the Treasury Rate shall be calculated as a yield to
maturity (expressed as a bond equivalent on the basis of a year of 365 or 366
days, as applicable, and applied on a daily basis) of the arithmetic mean of
the secondary market bid rates as of approximately 3:30 p.m., New York City
time, on such Treasury Rate Determination Date, of three (3) leading primary
United States government securities dealers selected by the Calculation Agent
for the issue of treasury securities with a remaining maturity closest to the
Index Maturity specified on the face hereof, provided,
however, that if the dealers selected as aforesaid by the
Calculation Agent are not quoting bid rates as mentioned above, then the
Treasury Rate for the Interest Reset Period will be the same as the Treasury
Rate for the immediately preceding Interest 

 

A-3-17

 

Reset Period.  If there was no
such Interest Reset Period, the Treasury Rate will be the Initial Interest
Rate.

 

(2)           The “Treasury Rate
Determination Date” for each Interest Reset Period will be the day of the week
in which the Interest Reset Date for such Interest Reset Period falls on which
treasury securities would normally be auctioned.  Treasury securities are normally sold at auction on Monday of
each week, unless that day is a legal holiday, in which case the auction is
normally held on the following Tuesday, except that such auction may be held on
the preceding Friday.  If, as the result
of a legal holiday, an auction is so held on the preceding Friday, such Friday
will be the Treasury Rate Determination Date pertaining to the Interest Reset
Period commencing in the next succeeding week. 
If an auction date shall fall on any day that would otherwise be an
Interest Reset Date for a Treasury Rate Note, then such Interest Reset Date
shall instead be the Business Day immediately following such auction date.

 

(F)           Constant Maturity
Treasury Rate Notes.

 

(1)           If the Interest Rate
Basis is the Constant Maturity Treasury Rate, this Note shall be deemed to be a
“Constant Maturity Treasury Rate Note.” 
A Constant Maturity Treasury Rate Note will bear interest for each
Interest Reset Period at the interest rate calculated with reference to the
Constant Maturity Treasury Rate and the Spread or Spread Multiplier, if
any.  If “Constant Maturity Treasury
Rate” is specified on the face hereof and unless otherwise specified on the
face hereof, “Constant Maturity Treasury Rate” for each Interest Reset Period
will be the rate displayed on the Designated Constant Maturity Treasury Page
(as defined below) under the caption “Treasury Constant Maturities” under the
column for the Designated CMT Maturity Index for either (1) that Constant
Maturity Treasury Rate Determination Date (as hereinafter defined), if the
Designated Constant Maturity Treasury Page is 7051 (or any other page that may
replace this page on that service); or (2) the week, or the month, as set forth
on the face hereof, ended immediately preceding the week in which the Calculation
Date pertaining to the Constant Maturity Treasury Rate Determination Date
occurs, if the Designated Constant Maturity Treasury Page is 7052 (or any other
page that may replace this page on that service).

 

If the Treasury Rate is no longer displayed
on the Designated Constant Maturity Treasury Page, or if not displayed by 3:00
p.m., New York City time, on the Calculation Date pertaining to the Constant
Maturity Treasury Rate Determination Date, then the Constant Maturity Treasury
Rate will be the Treasury Constant

 

A-3-18

 

Maturity rate for the Designated CMT Maturity
Index (as hereinafter defined) as published in H.15(519) for the Constant
Maturity Treasury Rate Determination Date. 
If the Constant Maturity Treasury Rate is no longer published, or if not
published in H.15(519) by 3:00 p.m., New York City time, on the Calculation
Date pertaining to the Constant Maturity Treasury Rate Determination Date, then
the Constant Maturity Treasury Rate for that Constant Maturity Treasury Rate
Determination Date will be the Treasury Constant Maturity rate for the
Designated CMT Maturity Index (or other United States Treasury Rate for the
Designated CMT Maturity Index) for that Constant Maturity Treasury Rate Determination
Date with respect to the Interest Reset Date then published by either the Board
of Governors of the Federal Reserve System or the United States Department of
the Treasury that the Calculation Agent determines is comparable to the rate
formerly displayed on the Designated Constant Maturity Treasury Page and
published in the relevant H.15(519).  If
the information in the immediately preceding sentence is not available by 3:00
p.m., New York City time, on the Calculation Date pertaining to the Constant
Maturity Treasury Rate Determination Date, then the Calculation Agent will
calculate the Constant Maturity Treasury Rate to be a yield to maturity, based
on the arithmetic mean of the secondary market offer side prices as of
approximately 3:30 p.m., New York City time, on the Constant Maturity Treasury
Rate Determination Date reported, according to their written records, by three
(3) leading primary United States government securities dealers (each, a “CMT
Reference Dealer”) in the City of New York selected by the Calculation
Agent.  The three (3) CMT Reference
Dealers shall be selected from five CMT Reference Dealers selected by the
Calculation Agent by eliminating the highest quotation (or, in the event of
equality, one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest), for the most recently issued direct noncallable
fixed rate obligations of the United States (“Treasury Notes”) with an original
maturity of approximately the Designated CMT Maturity Index and a remaining
term to maturity of not less than such Designated CMT Maturity Index minus one
year.  If the Calculation Agent cannot
obtain three (3) Treasury Note quotations as described above, the Treasury Rate
will be a rate with a yield to maturity based on the arithmetic mean of the
secondary market offer side prices as of approximately 3:30 p.m., New York City
time, on the Constant Maturity Treasury Rate Determination Date of three (3)
CMT Reference Dealers in the City of New York. 
The three (3) CMT Reference Dealers shall be selected from five CMT
Reference Dealers selected by the Calculation Agent and eliminating the highest
quotation (or, in the

 

A-3-19

 

event of equality, one of the highest) and
the lowest quotation (or, in the event of equality, one of the lowest), for
Treasury Notes with an original maturity of the number of years that is the
next highest to the Designated CMT Maturity Index and a remaining term to
maturity closest to the Designated CMT Maturity Index and in an amount of at
least $100 million.  If two (2) of these
Treasury Notes have remaining terms to maturity equally close to the Designated
CMT Maturity Index, the quotes for the Treasury Note with the shorter remaining
term to maturity will be used.  If fewer
than five but more than two (2) CMT Reference Dealers are quoting as described
above, then the Treasury Rate will be based on the arithmetic mean of the offer
prices obtained and neither the highest nor lowest of those quotes will be eliminated;
provided, however, that if fewer
than three (3) CMT Reference Dealers are quoting as described above, then the
Constant Maturity Treasury Rate for the Interest Reset Period will be the same
as the Constant Maturity Treasury Rate for the immediately preceding Interest
Reset Period.  If there was no such
Interest Reset Period, the Constant Maturity Treasury Rate will be the Initial
Interest Rate.

 

(2)           For purposes of Constant Maturity
Treasury Rate Notes, the “Constant Maturity Treasury Rate Determination Date”
will be the tenth (10th) Business Day prior to the Interest Reset
Date for the applicable Interest Reset Period. 
“Designated Constant Maturity Treasury Page” means the display on
Moneyline Telerate, Inc. on the page designated on the face hereof, or any
successor service or page for the purpose of displaying Treasury Constant
Maturities as reported in H.15(519).  If
that page is not specified on the face hereof, the Designated Constant Maturity
Treasury Page shall be 7052, for the most recent week.  “Designated CMT Maturity Index” means the
original period to maturity of the Treasury Notes (either 1, 2, 3, 5, 7, 10,
20, or 30 years) designated on the face hereof with respect to which the
Constant Maturity Treasury Rate will be calculated.  If no such maturity is specified on the face hereof, the
Designated CMT Maturity Index shall be 2 years.

 

(G)           Prime Rate Notes.  If the Interest Rate Basis is the Prime
Rate, this Note shall be deemed to be a “Prime Rate Note.”  A Prime Rate Note will bear interest for
each Interest Reset Period calculated with reference to the Prime Rate and the
Spread or Spread Multiplier, if any, specified on the face hereof.  The Calculation Agent will determine the
Prime Rate for each Interest Reset Period on each Prime Rate Determination Date
by the Calculation Date pertaining to such Prime Rate Determination Date.  The Prime Rate Determination Date is the
second (2nd) Business Day prior to the Interest Reset Date for each
Interest Reset Period.  Unless otherwise
specified on the face hereof, “Prime Rate” means the rate on the

 

A-3-20

 

Calculation Date made available and subsequently published on the
Calculation Date in H.15(519) under the heading “Bank Prime Loan” or, if not so
published by 3:00 p.m., New York City time, on the Calculation Date pertaining
to such Prime Rate Determination Date, the Prime Rate will be the rate on that
day as published in the H.15 Daily Update or another recognized electronic
source used for the purpose of displaying this rate, under the heading “Bank
Prime Loan,” or if neither such rate is published by 3:00 p.m., New York City
time, on such Calculation Date pertaining to the Prime Rate Determination Date,
the Prime Rate will be the arithmetic mean of the rates of interest offered by
various banks that appear on the Reuters Screen USPRIME1 Page (hereinafter
defined) as each such bank’s prime rate or base lending rate as in effect for
the Prime Rate Determination Date.  If
fewer than four (4) such rates appear on the Reuters Screen USPRIME1 Page, the
Calculation Agent will select three (3) major banks in New York City after
consultation with the Trust.  The Prime
Rate will be the arithmetic mean of the prime rates quoted by those three (3)
banks on the basis of the actual number of days in the year divided by a
360-day year as of the close of business on such Prime Rate Determination Date;
provided, however, that if fewer
than three (3) banks in New York City are quoting as mentioned in this sentence,
the Prime Rate for the Interest Reset Period will be the same as the Prime Rate
in effect for the immediately preceding Interest Reset Period.  If there was no such Interest Reset Period,
the Prime Rate will be the Initial Interest Rate.  “Reuters Screen USPRIME1 Page” means the display designated as
page “USPRIME1” on the Reuters Monitor Money Rates Service, or any successor
service or page, for the purpose of displaying prime rates or base lending
rates of major United States banks.

 

(H)          Inverse Floating
Rate Notes.  If this Note is
designated as an Inverse Floating Rate Note on the face hereof, the Inverse
Floating Rate shall be equal to (1) in the case of the period, if any,
commencing on the Original Issue Date (or such other date which may be specified
on the face hereof as the date on which this Note shall begin to accrue
interest), up to the first (1st) Interest Reset Date, a fixed rate
of interest established by the Trust as specified on the face hereof, and (2)
in the case of each period commencing on an Interest Reset Date, a fixed rate
of interest as specified on the face hereof minus the interest rate determined
based on the Interest Rate Basis as adjusted by the Spread or Spread
Multiplier, if any; provided, however,
that (1) the interest rate will not be less than zero and (2) the interest rate
in effect for the ten (10) days immediately prior to the Maturity Date will be
that in effect on the tenth (10th) day preceding the Maturity Date.

 

(I)            Floating
Rate/Fixed Rate Notes.  If this Note
is designated as a “Floating Rate/Fixed Rate Note” on the face hereof, this
Note will be a Floating Rate Note for a specified portion of its term and a
Fixed Rate Note for the remainder of its term, commencing on the Fixed Rate

 

A-3-21

 

Commencement Date specified on the face hereof, in which event the
interest rate on this Note will be determined as provided herein as if it were
a Floating Rate Note and a Fixed Rate Note hereunder for each such respective
period.

 

Section 4.  
Optional Redemption.  If no redemption right is set forth on the
face hereof, this Note may not be redeemed prior to the Stated Maturity Date,
except as set forth in the Indenture. 
If a Redemption Right is set forth on the face of this Note, the Trust
shall elect to redeem this Note on the Interest Payment Date after the Initial
Redemption Date set forth on the face hereof on which the Funding Agreement is
to be redeemed in whole or in part by Protective Life Insurance Company
(“Protective Life”) (each, a “Redemption Date”), in which case this Note must
be redeemed on such Redemption Date in whole or in part, as applicable,  in increments of $1,000 at the applicable
Redemption Price (as defined below), together with unpaid interest accrued thereon
to the applicable Redemption Date. 
“Redemption Price” shall mean an amount equal to the Initial Redemption
Percentage (as adjusted by the Annual Redemption Percentage Reduction, if
applicable) multiplied by the unpaid Principal Amount of this Note to be
redeemed.  The unpaid Principal Amount
of this Note to be redeemed shall be determined by multiplying (1) the
Outstanding Principal Amount of this Note by (2) the quotient derived by
dividing (A) the outstanding principal amount of the Funding Agreement to be
redeemed by Protective Life, by (B) the outstanding principal amount of the
Funding Agreement.  The Initial
Redemption Percentage, if any, applicable to this Note shall decline at each
anniversary of the Initial Redemption Date by an amount equal to the applicable
Annual Redemption Percentage Reduction, if any, until the Redemption Price is
equal to 100% of the Principal Amount thereof to be redeemed.  Notice must be given not more than
seventy-five (75) nor less than thirty (30) calendar days prior to the proposed
redemption date.  In the event of
redemption of this Note in part only, a new Note for the unredeemed portion
hereof shall be issued in the name of the Holder hereof upon the surrender
hereof.  If less than all of the Notes
are redeemed, the Indenture Trustee will select by lot or in its discretion, on
a pro rata basis, the amount of the interest of each direct participant in the
Trust to be redeemed.  Unless otherwise
specified herein, the Trust may not redeem the Notes after the date that is
thirty (30) days prior to the Stated Maturity Date.

 

Section 5.  
Sinking Funds and Amortizing Notes.  Unless this Note is specified as an
Amortizing Note on the face hereof, this Note will not be subject to any
sinking fund.

 

Section 6.  
Optional Repayment.  If no repayment right is set forth on the
face hereof, this Note may not be repaid at the option of the Holder hereof
prior to the Stated Maturity Date.  If a
Repayment Right is granted on the face of this Note, this Note may be subject
to repayment at the option of the Holder on any Interest Payment Date on and
after the date, if any, indicated on the face hereof (each, a “Repayment
Date”).  On any Repayment Date, unless
otherwise specified on the face hereof, this Note shall be repayable in whole
or in part in increments of $1,000 at the option of the Holder hereof at a
repayment price equal to 100% of the Principal Amount to be repaid, together
with interest thereon payable to the date of repayment.  For this Note to be repaid in whole or in
part at the option of the Holder hereof, this Note must be received by the
Indenture Trustee, with the form entitled “Option to Elect Repayment,” below,
duly completed by the Indenture Trustee. 
Exercise of such repayment option by the Holder hereof shall be irrevocable.

 

A-3-22

 

Section 7.  
Modification and Waivers.  The Indenture contains provisions permitting
the Trust and the Indenture Trustee (1) at any time without notice to, or the
consent of, the Holders of any Notes issued under the Indenture to execute
supplemental indentures for certain enumerated purposes and (2) with the
consent of the Holders of not less than a majority in aggregate principal
amount of the Outstanding Notes affected thereby, to execute supplemental
indentures for the purpose of adding any provisions to, or changing in any
manner or eliminating any of the provisions of the Indenture or of modifying in
any manner the rights of Holders of Notes under the Indenture; provided, that, with respect to certain
enumerated provisions, no such supplemental indenture may be entered into
without the consent of the Holder of each Note affected thereby.  Any such consent or waiver by the Holder of
this Note shall be conclusive and binding upon such Holder and upon all future
Holders of this Note and of any Note issued upon the registration of transfer
hereof or in exchange hereof or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Note or such other Notes.

 

Section 8.  
Obligations Unconditional.  No reference herein to the Indenture and no
provisions of this Note or of the Indenture shall impair the right of each
Holder of any Note, which is absolute and unconditional, to receive payment of
the principal of, and any interest on, such Note on the respective Stated
Maturity Date thereof and to institute suit for the enforcement of any such
payment, and such rights shall not be impaired without the consent of such
Holder.

 

Section 9.  
Events of Default.  If an Event of Default with respect to Notes
of this Series shall occur and be continuing, the principal of the Notes of
this Series may be declared due and payable, or may be automatically
accelerated, as the case may be, in the manner and with the effect provided in
the Indenture.  In the event that this
Note is a Discount Note, the amount of principal of this Note that becomes due
and payable upon such acceleration shall be equal to the amount calculated as
set forth in Section 3(b) hereof.

 

Section 10.  
Withholding; Additional Amounts; Tax Event.  All amounts due on this Note will be made
net of any applicable withholding or deduction for or on account of any present
or future taxes, duties, levies, assessments or other governmental charges of
whatever nature imposed or levied by or on behalf of any governmental
authority, unless such withholding or deduction is required by law.  Unless otherwise specified on the face
hereof, the Trust will not pay any Additional Amounts to the Holders of this
Series of Notes in respect of any such withholding or deduction and any such
withholding or deduction will not give rise to an Event of Default or any
independent right or obligation to redeem the Notes of the Series.  If set forth on the face hereof, in the
event the Trust is required, or based on an opinion of independent legal
counsel selected by Protective Life a material probability exists that the
Trust will be required to pay additional amounts in respect of such withholding
or deduction, Protective Life will have the right to redeem the Funding
Agreement and, if Protective Life redeems the Funding Agreement, the Trust will
redeem this Note at the Redemption Price set forth on the face hereof with no
less than thirty (30) days and no more than seventy-five (75) days notice.

 

If (1) a Tax Event (defined below) as to the
relevant Funding Agreement(s) occurs and (2) Protective Life redeems the
Funding Agreement in whole or in part, the Trust will redeem the Notes, subject
to the terms and conditions of Section 2.04 of the Indenture, at the Tax
Event Redemption Price (defined below) together with unpaid interest accrued
thereon to the applicable redemption date. 
“Tax Event” means that Protective Life shall have received an opinion of

 

A-3-23

 

independent legal counsel stating in effect that as a result of (a) 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 therefor or therein or (b) any amendment to, or
change in, an interpretation or application of any such laws or regulations by
any governmental authority in the United States, which amendment or change is
enacted, promulgated, issued or announced on or after the date the applicable
Funding Agreement is entered into, there is more than an insubstantial risk
that (i) the Trust is, or will be within ninety (90) days of the date thereof,
subject to U.S. federal income tax with respect to interest accrued or received
on the relevant Funding Agreement or (ii) the Trust is, or will be within
ninety (90) days of the date thereof, subject to more than a de minimis amount
of taxes, duties or other governmental charges.  “Tax Event Redemption Price” means an amount equal to the unpaid
principal amount of this Note to be redeemed. 
The unpaid principal amount of this Note to be redeemed shall be
determined by multiplying (1) the Outstanding Principal Amount of this Note by
(2) the quotient derived by dividing (A) the outstanding principal amount to be
redeemed by Protective Life of the Funding Agreement by (B) the outstanding
principal amount of the Funding Agreement.

 

Section 11.   Listing.  Unless otherwise specified on the face
hereof, this Series of Notes will not be listed on any securities exchange.

 

Section 12.    No Recourse  Against
Certain Persons.  No recourse
shall be had for the payment of the principal of or the interest on this Note,
or for any claim based hereon, or otherwise in respect hereof, or based on or
in respect of the Indenture or any indenture supplemental thereto, against the
Nonrecourse Parties, whether by virtue of any constitution, statute or rule of
law, or by the enforcement of any assessment or penalty or otherwise, all such
personal liability being, by the acceptance hereof and as part of the
consideration for issue hereof, expressly waived and released.

 

Section 13.  
Miscellaneous.

 

(a)           This
Note is issuable only as a registered Note without coupons in denominations of
$1,000 and any integral multiple in excess thereof unless otherwise
specifically agreed between the parties and provided on the face of this Note.

 

(b)           Prior
to due presentment for registration of transfer of this Note, the Trust, the
Indenture Trustee, the Registrar, the Paying Agent, any Agent, and any other
agent of the Trust or the Indenture Trustee may treat the Person in whose name
this Note is registered as the owner hereof for the purpose of receiving
payment as herein provided (subject to Section 2.09 of the Indenture)
and for all other purposes, whether or not this Note be overdue, and none of
the Trust, the Indenture Trustee, the Registrar, the Paying Agent, any Agent,
and any other agent of the Trust or the Indenture Trustee shall be affected by
notice to the contrary.

 

(c)           The
Notes are being issued by means of a physical distribution of notes to be made
as provided in the Indenture.  The
Register maintained by the Registrar will evidence ownership of the Notes, with
transfers of ownership effected on the Register and through the Transfer
Agent.  Transfer of principal, premium
(if any) and interest to

 

A-3-24

 

the Holder will be the responsibility of the Paying Agent.  The selection of any Notes to be redeemed or
repaid will be determined by the Indenture Trustee pursuant to the Indenture.

 

(d)           This
Note or portion hereof may not be exchanged for Global Notes of this Series of
Notes.  No service charge will be made
for any registration of transfer or exchange, but the Trust may require payment
of a sum sufficient to cover any tax or other governmental charge payable in
connection therewith.

 

Section 14.  
GOVERNING LAW.  THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES.

 

A-3-25

 

OPTION TO ELECT REPAYMENT

 

The undersigned hereby irrevocably request(s) and instruct(s) the Trust
to repay this Note (or portion hereof specified below) pursuant to its terms at
a price equal to the Principal Amount hereof together with interest to the
repayment date, to the undersigned, at:

	
   

  
	
   

  
	
   

  
	
   

  
	
  (Please print or typewrite name and address of the undersigned).

  

 

For this Note to be repaid, the Indenture Trustee (or the Paying Agent
on behalf of the Indenture Trustee) must receive at its Corporate Trust Office,
or at such other place or places of which the Trust shall from time to time
notify the Holder of this Note, not more than sixty (60) nor less than thirty
(30) days prior to a Repayment Date, if any, shown on the face of this Note,
this Note with this “Option to Elect Repayment” form duly completed.

 

If less than the entire Principal Amount of this Note is to be repaid,
specify the portion hereof (which shall be in increments of $1,000) which the
Holder elects to have repaid and specify the denomination or denominations
(which shall be $             
or an integral multiple of $1,000 in excess of $             )
of the Notes to be issued to the Holder for the portion of this Note not being
repaid (in the absence of any such specification, one such Note will be issued
for the portion not being repaid).

 

	
  $

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  NOTICE: The signature
  on this Option to Elect Repayment must correspond with the name as written
  upon the face of this Note in every particular, without alteration or
  enlargement or any change whatever.

  
	
  DATE:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Registered Face Amount
  to be repaid, if amount to be repaid is less than the Registered Face Amount
  of this Note (Registered Face Amount remaining must be an authorized
  denomination)

  	
   

  	
  Fill in for
  registration of Notes if to be issued otherwise than to the registered
  Holder:

  
	
   

  	
   

  	
  Name: 

  	
   

  	
   

  
	
  $

  	
   

  	
   

  	
   

  	
  Address:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Please print name and

  address including zip code)

  
												

 

SOCIAL SECURITY OR OTHER TAXPAYER ID NUMBER:                                                  

 

A-3-26

 

SCHEDULE I

 

Amortization Table or Formula

 

A-3-27QuickLinks
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EXHIBIT 4.6    
    

 
 

FORM OF CERTIFICATE OF TRUST OF    
    

        THIS Certificate of Trust of Protective Life Secured Trust [            ] (the "Trust")
is being duly executed and filed on behalf of the Trust by the undersigned, as trustee, to form a statutory trust under the Delaware Statutory Trust Act (12 Del.
C. § 3801 et seq., as amended from time to time) (the "Act"). 

        1.     Name. The name of the statutory trust formed by this Certificate of Trust is Protective Life Secured Trust
[            ]. 

        2.     Delaware Trustee. The name and business address of the trustee of the Trust in the State of Delaware are Wilmington Trust
Company, Rodney Square North, 1100 N. Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration. 

        3.     Effective Date. This Certificate of Trust shall be effective upon filing. 

        IN
WITNESS WHEREOF, the undersigned has duly executed this Certificate of Trust in accordance with Section 3811(a)(1) of the Act. 

	 	WILMINGTON TRUST COMPANY, not in its individual capacity but solely as trustee
	

 	

By:	

 
	 	 	

	 	 	Name:
	 	 	Title:

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EXHIBIT 4.6

FORM OF CERTIFICATE OF TRUST OF

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