Document:

EX-4.2

Exhibit 4.2

SOUTHWEST AIRLINES CO.

AND

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

TRUSTEE

INDENTURE

Dated as of February 14, 2005

1

TABLE OF CONTENTS

ARTICLE ONE

DEFINITIONS

	 	 	 
	SECTION 1.01.

SECTION 1.02.

SECTION 1.03.

	 	Certain Terms Defined

References are to Indenture

Conflict with Trust Indenture Act of 1939

ARTICLE TWO

ISSUE, DESCRIPTION, EXECUTION, REGISTRATION

AND EXCHANGE OF SECURITIES

	 	 	 
	SECTION 2.01.

SECTION 2.02.

SECTION 2.03.

SECTION 2.04.

SECTION 2.05.

SECTION 2.06.

SECTION 2.07.

SECTION 2.08.

SECTION 2.09.

SECTION 2.10.

	 	Forms Generally

Form of Trustee’s Certificate of Authentication

Amount Unlimited; Issuable in Series

Authentication and Delivery of Securities

Execution of Securities

Exchange of Securities

Temporary Securities

Mutilated, Destroyed, Lost or Stolen Securities

Cancellation of Surrendered Securities

Securities in Global Form

ARTICLE THREE

PARTICULAR COVENANTS OF THE COMPANY

	 	 	 
	SECTION 3.01.

SECTION 3.02.

SECTION 3.03.

SECTION 3.04.

SECTION 3.05.

SECTION 3.06.

SECTION 3.07.

	 	Payment of Principal of (and Premium, if any) and Interest on Securities

Maintenance of Office or Agency for Registration of Transfer, Exchange and Payment of Securities

Appointment to Fill a Vacancy in the Office of Trustee

Provision as to Paying Agent

Maintenance of Corporate Existence

Officers’ Certificate as to Default

Further Assurance

ARTICLE FOUR

SECURITYHOLDERS’ LISTS AND REPORTS BY THE COMPANY

AND THE TRUSTEE

	 	 	 
	SECTION 4.01.

SECTION 4.02.

SECTION 4.03.

SECTION 4.04.

	 	Company to Furnish Trustee Information as to Names and

Addresses to Securityholders

Preservation and Disclosure of Lists

Reports by the Company

Reports by the Trustee

ARTICLE FIVE

REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS

ON EVENT OF DEFAULT

	 	 	 
	SECTION 5.01.

SECTION 5.02.

SECTION 5.03.

SECTION 5.04.

SECTION 5.05.

SECTION 5.06.

SECTION 5.07.

SECTION 5.08.

	 	Events of Default Defined; Acceleration of Maturity; Waiver of Default

Payment of Securities on Default; Suit Therefor

Application of Moneys Collected by Trustee

Limitation on Suits by Holders of Securities

Proceedings by Trustee; Remedies Cumulative and Continuing

Rights of Holders of Majority in Principal Amount of Securities to Direct Trustee and to Waive Defaults

Trustee to Give Notice of Defaults Known to It, But May Withhold in Certain Circumstances

Requirement of an Undertaking to Pay Costs in Certain Suits Under this Indenture or Against the Trustee

ARTICLE SIX

CONCERNING THE TRUSTEE

	 	 	 
	SECTION 6.01.

SECTION 6.02.

SECTION 6.03.

SECTION 6.04.

SECTION 6.05.

SECTION 6.06.

SECTION 6.07.

SECTION 6.08.

SECTION 6.09.

SECTION 6.10.

SECTION 6.11.

SECTION 6.12.

SECTION 6.13.

	 	Duties and Responsibilities of Trustee

Reliance on Documents, Opinions, etc

No Responsibility for Recitals, etc

Trustee, Paying Agent or Security Registrar May Own Securities

Moneys Received by Trustee to be Held in Trust Without Interest

Compensation and Expenses of Trustee

Right of Trustee to Rely on Officers’ Certificate Where No Other Evidence Specifically Prescribed

Conflicting Interest of Trustee

Requirements for Eligibility of Trustee

Resignation or Removal of Trustee

Acceptance by Successor to Trustee; Notice of Succession of a Trustee

Successor to Trustee by Merger, Consolidation or Succession to Business

Limitations on Rights of Trustee as a Creditor

ARTICLE SEVEN

CONCERNING THE SECURITYHOLDERS

	 	 	 
	SECTION 7.01.

SECTION 7.02.

SECTION 7.03.

SECTION 7.04.

SECTION 7.05.

SECTION 7.06.

	 	Evidence of Action by Securityholders

Proof of Execution of Instruments and of Holding of Securities

Who May be Deemed Owners of Securities

Securities Owned by Company or Controlled or Controlling Persons Disregarded for Certain Purposes

Record Date for Action by Securityholders

Instruments Executed by Securityholders Bind Future Holders

ARTICLE EIGHT

SECURITYHOLDERS’ MEETINGS

	 	 	 
	SECTION 8.01.

SECTION 8.02.

SECTION 8.03.

SECTION 8.04.

SECTION 8.05.

SECTION 8.06.

SECTION 8.07.

SECTION 8.08.

	 	Purposes for Which Meetings May be Called

Manner of Calling Meetings; Record Date

Call of Meeting by Company or Securityholders

Who May Attend and Vote at Meetings

Regulations

Manner of Voting at Meetings and Record to be Kept

Exercise of Rights of Trustee and Securityholders Not

to be Hindered or Delayed

Written Consent in Lieu of Meeting of Securityholders

ARTICLE NINE

SUPPLEMENTAL INDENTURES

	 	 	 
	SECTION 9.01.

SECTION 9.02.

SECTION 9.03.

SECTION 9.04.

SECTION 9.05.

	 	Purposes for Which Supplemental Indentures May be Entered into Without Consent of Securityholders

Modification of Indenture with Consent of Holders of 66?% in Principal Amount of Securities

Effect of Supplemental Indentures

Securities May Bear Notation of Changes by Supplemental Indentures

Opinion of Counsel

ARTICLE TEN

CONSOLIDATION, MERGER AND SALE

	 	 	 
	SECTION 10.01.

SECTION 10.02.

	 	Company May Consolidate, etc., on Certain Terms

Successor Corporation to be Substituted

ARTICLE ELEVEN

SATISFACTION AND DISCHARGE OF INDENTURE;

UNCLAIMED MONEYS

	 	 	 
	SECTION 11.01.

SECTION 11.02.

SECTION 11.03.

SECTION 11.04.

SECTION 11.05.

	 	Satisfaction and Discharge of Indenture

Application by Trustee of Funds Deposited for Payment of Securities

Repayment of Moneys Held by Paying Agent

Repayment of Moneys Held by Trustee

Satisfaction, Discharge and Defeasance of Securities of any Series

ARTICLE TWELVE

IMMUNITY OF INCORPORATORS, SHAREHOLDERS, OFFICERS

AND DIRECTORS

	 	 	 	SECTION 12.01. Incorporators, Shareholders, Officers and Directors Exempt from
Individual Liability	 

ARTICLE THIRTEEN

MISCELLANEOUS PROVISIONS

	 	 	 
	SECTION 13.01.

SECTION 13.02.

SECTION 13.03.

SECTION 13.04.

SECTION 13.05.

SECTION 13.06.

SECTION 13.07.

SECTION 13.08.

SECTION 13.09.

SECTION 13.10.

SECTION 13.11.

	 	Successors and Assigns of Company Bound by Indenture

Acts of Board, Committee or Officer of Successor Entity Valid

Required Notices or Demands May be Served by Mail; Waiver

Indenture and Securities to be Construed in Accordance with the Laws of the State of Texas

Evidence of Compliance with Conditions Precedent

Payments Due on Saturdays, Sundays, and Holidays

Provisions Required by Trust Indenture Act of 1939 to Control

Provisions of this Indenture and Security for the Sole Benefit of the Parties and the Securityholders

Indenture May be Executed in Counterparts

Article and Section Headings

Severability

ARTICLE FOURTEEN

REDEMPTION OF SECURITIES AND SINKING FUNDS

	 	 	 
	SECTION 14.01.

SECTION 14.02.

SECTION 14.03.

SECTION 14.04.

SECTION 14.05.

	 	Applicability of Article

Notice of Redemption; Partial Redemptions

Payment of Securities Called for Redemption

Exclusion of Certain Securities from Eligibility for

Selection for Redemption

Mandatory and Optional Sinking Funds

2

THIS INDENTURE, dated as of February 14, 2005, between Southwest Airlines Co., a
corporation duly organized and existing under the laws of the State of Texas (hereinafter sometimes
referred to as the “Company”), party of the first part, and The Bank of New York Trust Company,
N.A., a national banking association (hereinafter sometimes referred to as the “Trustee”), party of
the second part;

WITNESSETH:

WHEREAS, for its lawful corporate purposes, the Company has duly authorized the issue from
time to time of its debentures, notes or other unsecured evidences of indebtedness, which are to be
issued in one or more series (the “Securities”), each such series ranking pari passu with each
other series in contractual right of payment, as unsecured obligations of the Company, up to such
principal amount or amounts as may from time to time be authorized in accordance with the terms of
this Indenture; and to provide, among other things, for the authentication, delivery and
administration thereof, the Company has duly authorized the execution of this Indenture; and

WHEREAS, all acts and things necessary to make the Securities, when executed by the Company
and authenticated and delivered by the Trustee as in this Indenture provided, the valid, binding
and legal obligations of the Company, and to constitute these presents a valid indenture and
agreement according to its terms, have been done and performed, and the execution of this Indenture
and the issue hereunder of the Securities have in all respects been duly authorized, and the
Company, in the exercise of the legal right and power vested in it, executes this Indenture and
proposes to make, execute, issue and deliver the Securities;

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

That in order to declare the terms and conditions upon which the Securities are authenticated,
issued, delivered and held, and in consideration of the premises, of the purchase and acceptance of
the Securities by the holders thereof and of the sum of one dollar to it duly paid by the Trustee
at the execution of these presents, the receipt whereof is hereby acknowledged, the Company
covenants and agrees with the Trustee, for the benefit of the respective holders from time to time
of the Securities, as follows:

ARTICLE ONE

DEFINITIONS

SECTION 1.01. Certain Terms Defined. The terms defined in this Section 1.01 (except as
otherwise expressly provided or unless the context otherwise requires), for all purposes of this
Indenture and of any indenture supplemental hereto, shall have the respective meanings specified in
this Section 1.01. All other terms used in this Indenture that are defined in the Trust Indenture
Act of 1939, or that are by reference therein defined in the Securities Act of 1933, as amended
(except as herein otherwise expressly provided or unless the context otherwise requires), shall
have the meanings assigned to such terms in the Trust Indenture Act of 1939 and in said Securities
Act as they were in force at the date of the execution of this Indenture, unless said Trust
Indenture Act of 1939 or said Securities Act expressly provide for application of such statutes as
of another date.

Affiliate: The term “Affiliate” shall mean any person directly or indirectly
controlling, controlled by, or under direct or indirect common control with, the Company.

Bankruptcy Code: The term “Bankruptcy Code” shall mean Title 11, U.S. Code, or any
similar federal or state law for the relief of debtors.

Board of Directors: The term “Board of Directors,” when used with reference to the
Company, shall mean the Board of Directors of the Company or any duly authorized committee of the
Board of Directors of the Company.

Business Day: The term “Business Day” shall mean, with respect to any Security, a
day other than a Saturday, a Sunday or a day that shall be in the city (or in any of the cities, if
more than one), in which amounts are payable, as specified on the face of the form of such
Security, a day on which banking institutions are authorized or obligated by law to close.

Commission: The term “Commission” shall mean the Securities and Exchange Commission,
as from time to time constituted, created under the Securities Exchange Act of 1934, or if at any
time after the execution and delivery of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act of 1939, then the body
performing such duties on said date.

Company: The term “Company” shall mean Southwest Airlines Co., a Texas corporation,
and, subject to the provisions of Article Ten, shall also include its successors and assigns.

Depositary: The term “Depositary” shall mean, with respect to the Securities of any
series issuable or issued in whole or in part in the form of one or more Global Securities, the
person designated as Depositary for such series by the Company pursuant to Section 2.03 or
otherwise appointed by the Company as a successor to such person in the event such person is
unwilling or unable to continue to serve in such capacity.

Event of Default: The term “Event of Default” shall mean any event specified in
Section 5.01, continued for the period of time, if any, and after the giving of notice, if any,
therein designated.

Global Security: The term “Global Security” shall mean a Security issued in
accordance with Section 2.10 evidencing all or part of a series of Securities, which in each case
is issued to the Depositary for such series, or part of a series, or its nominee and registered in
the name of such Depositary or nominee.

Indenture: The term “Indenture” shall mean this instrument as originally executed,
or, if amended or supplemented as herein provided, as so amended or supplemented or both, and shall
include the forms and terms of particular series of Securities established as contemplated
hereunder.

Interest: The term “interest,” when used with respect to a non-interest bearing
Security, shall mean interest payable after the principal thereof has become due and payable,
whether after maturity, by declaration of acceleration, by call for redemption pursuant to a
sinking fund, or otherwise.

Officers’ Certificate: The term “Officers’ Certificate” shall mean a certificate
signed by the Chairman of the Board or the President or any Vice Chairman of the Board or any Vice
President and by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary
of the Company. Each such certificate shall include the statements provided for in Section 13.05,
if and to the extent required by the provisions thereof.

Opinion of Counsel: The term “Opinion of Counsel” shall mean an opinion in writing
signed by legal counsel, who may be an employee of, or of counsel to, the Company or may be other
counsel. Each such opinion shall include the statements provided for in Section 13.05, if and to
the extent required by the provisions thereof.

Original Issue Discount Security: The term “Original Issue Discount Security” shall
mean any Security that provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the maturity thereof pursuant to Section 5.01.

Outstanding: The term “outstanding,” when used with reference to Securities, shall,
subject to the provisions of Section 7.04, mean, as of any particular time, all Securities
authenticated and delivered by the Trustee under this Indenture except:

(a) Securities theretofore canceled by the Trustee or delivered to the Trustee for
cancellation;

(b) Securities, or portions thereof, for the payment or redemption of which moneys in
the necessary amount shall have been deposited in trust with the Trustee or with any Paying
Agent (other than the Company) or shall have been set aside and segregated in trust by the
Company for the holders of such Securities (if the Company shall act as its own Paying
Agent), provided that if such Securities are to be redeemed prior to the maturity hereof,
notice of such redemption shall have been given as herein provided, or provision
satisfactory to the Trustee shall have been made for giving such notice, and, if all such
Securities are redeemed, such deposit shall be in accordance with Article Eleven; and

(c) Securities in lieu of or in substitution for which other Securities shall have
been authenticated and delivered, or which shall have been paid, pursuant to the terms of
Section 2.08, unless proof satisfactory to the Trustee is presented that any such Securities
are held by a person in whose hands such Security is a legal, valid and binding obligation
of the Company.

In determining whether the holders of the requisite principal amount of outstanding Securities
of any or all series have given any request, demand, authorization, direction, notice, consent or
waiver hereunder, the principal amount of an Original Issue Discount Security that shall be deemed
to be outstanding for such purposes shall be the amount of the principal thereof that would be due
and payable as of the date of such determination upon a declaration of acceleration of the maturity
thereof pursuant to Section 5.01.

Paying Agent: Any person authorized by the Company to pay the principal of, premium,
if any, or interest on any securities on behalf of the Company.

Responsible Officer: The term “Responsible Officer,” when used with respect to the
Trustee, shall mean any officer within the corporate trust and agency group or department of the
Trustee, including any Vice President, any trust officer or any other officer of the Trustee
performing functions similar to those performed by any of the above-designated officers and also
means, with respect to a particular corporate trust matter, any other officer to whom such matter
is referred because of his knowledge of and familiarity with the particular subject.

Security or Securities: The term “Security” or “Securities” shall mean any Security
or Securities, as the case may be, authenticated and delivered under this Indenture.

Securityholder: The term “Securityholder,” “holder of Securities,” or other similar
term, shall mean any person who shall at the time be the registered holder of any Security or
Securities on the books of the Company kept for that purpose in accordance with the provisions of
this Indenture and shall also mean the executors, administrators and other legal representatives of
such person.

Subsidiary: The term “Subsidiary” shall mean any corporation or other entity at least
a majority of the outstanding voting shares of which is at the time directly or indirectly owned or
controlled (either alone or through Subsidiaries or together with Subsidiaries) by the Company or
another Subsidiary.

Trustee; principal office: The term “Trustee” shall mean The Bank of New York Trust
Company, N.A., and, subject to the provisions of Article Six, shall also include its successors.
The term “principal office” of the Trustee shall mean a principal office of the Trustee at which at
any particular time its corporate trust business may be administered, which office at the date of
execution of this Indenture is located at 600 Pearl Street, Suite 420, Dallas, Texas 75201.

Trust Indenture Act of 1939: The term “Trust Indenture Act of 1939” shall mean the
Trust Indenture Act of 1939, as amended, as in effect on the date of this Indenture, except as
provided in Section 9.01 or 9.02 and except to the extent that any subsequent amendment to the
Trust Indenture Act of 1939 shall retroactively apply to this instrument.

Yield to Maturity: The term “Yield to Maturity” shall mean the yield to maturity on a
series of Securities, calculated at the time of the issuance of such series, or, if applicable, at
the most recent redetermination of interest on such series, and calculated in accordance with
accepted financial practice.

SECTION 1.02. References are to Indenture. Unless the context otherwise requires, all
references herein to “Articles,” “Sections” and other subdivisions refer to the corresponding
Articles, Sections and other subdivisions of this Indenture, and the words “herein,” “hereof,”
“hereby,” “hereunder” and words of similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision hereof.

SECTION 1.03. Conflict with Trust Indenture Act of 1939. If any provision hereof limits,
qualifies or conflicts with a provision of the Trust Indenture Act of 1939 that is required under
such Act to be part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust Indenture Act of 1939
that may be so modified or excluded, the latter provision shall be deemed to apply to this
Indenture as so modified or to be excluded, as the case may be.

ARTICLE TWO

ISSUE, DESCRIPTION, EXECUTION, REGISTRATION

AND EXCHANGE OF SECURITIES

SECTION 2.01. Forms Generally. The Securities of each series shall be substantially in the
form (not inconsistent with this Indenture) as shall be established by the Board of Directors or in
one or more indentures supplemental hereto, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by this Indenture, and
in case such form is not established by supplemental indenture, such form shall be approved by the
Trustee if the Trustee’s rights or obligations are adversely affected thereby and may have
imprinted or otherwise reproduced thereon such legend or legends, not inconsistent with the
provisions of this Indenture, as may be required to comply with any law or with any rules or
regulations pursuant thereto, or with any rules of any securities exchange or to conform to general
usage, consistently herewith, all as my be determined by the officer executing such Securities, as
evidenced by his execution of the Securities.

The definitive Securities shall be printed, lithographed or engraved on steel engraved borders
or, with the consent of the Trustee, may be produced in any other manner, all as determined by the
officer executing such Securities, as evidenced by his execution of such Securities.

SECTION 2.02. Form of Trustee’s Certificate of Authentication. The Trustee’s certificate
of authentication of all Securities shall be in substantially the following form:

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

THE BANK OF NEW YORK

TRUST COMPANY, N.A.,

as Trustee

By:      

Authorized Signatory

SECTION 2.03. Amount Unlimited; Issuable in Series. The aggregate principal amount of
Securities that may be authenticated and delivered under this Indenture is unlimited.

The Securities may be issued in one or more series. There shall be established by the Board
of Directors and set forth in an Officers’ Certificate or established in one or more indentures
supplemental hereto, prior to the issuance of Securities of any series, the following terms, which
terms shall be approved by the Trustee if the Trustee’s rights or obligations are adversely
affected thereby, and thereafter such terms shall be deemed to be a part of this Indenture:

(1) the title of the Securities of the series (which shall distinguish the
Securities of the series from all other Securities);

(2) any limit upon the aggregate principal amount of the Securities or the
series that may be authenticated and delivered under this Indenture (except for
Securities authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Securities of the series pursuant to Sections
2.06, 2.07, 2.08, 5.03, 9.04 and Article Fourteen);

(3) the date or dates on which the principal of the Securities of the series is
payable;

(4) the rate or rates, or method by which the rate or rates are determined, at
which the Securities of the series shall bear interest, if any, the date or dates
from which such interest shall accrue, the interest payment dates on which such
interest shall be payable and the record dates for the determination of
Securityholders to whom interest is payable;

(5) the offices or agencies of the Company in the United States of America
where the principal of and any interest on Securities of the series shall be
payable;

(6) the price or prices at which, the period or periods within which and the
terms and conditions upon which Securities of the series may be redeemed, in whole
or in part, at the option of the Company, pursuant to any sinking fund or otherwise;

(7) the obligation, if any, of the Company to redeem, purchase or repay
Securities of the series pursuant to any sinking fund or analogous provisions or at
the option of a holder thereof and the price or prices at which and the period or
periods within which and the terms and conditions upon which Securities of the
series shall be redeemed, purchased or repaid, in whole or in part, pursuant to such
obligation;

(8) if other than denominations of $1,000 and any multiple thereof, the
denominations in which Securities of the series shall be issuable;

(9) if other than the principal amount thereof, the portion of the principal
amount of Securities of the series that shall be payable upon declaration of
acceleration of the maturity thereof or provable in bankruptcy;

(10) any trustees, authenticating or Paying Agents, warrant agents, transfer
agents or registrars with respect to the Securities of such series;

(11) the applicability, if any, of Section 11.05 to such series;

(12) whether the Securities of the series shall be issued in whole or in part
in the form of one or more Global Securities and, in such case, the Depositary for
such Global Security or Securities, which Depositary shall be a clearing agency
registered under the Securities Exchange Act of 1934, as amended; and

(13) any other terms of the series (which terms shall not be inconsistent with
the provisions of this Indenture), including any additional covenants with respect
to such series.

All Securities of any one series shall be substantially identical except as to denomination
and except as may otherwise be provided by the Board of Directors and set forth in such Officers’
Certificate or as may be otherwise provided in any such indenture supplemental hereto.

SECTION 2.04. Authentication and Delivery of Securities. At any time and from time to time
after the execution and delivery of this Indenture, the Company may deliver Securities of any
series executed by the Company to the Trustee for authentication, and the Trustee shall thereupon
authenticate and deliver said Securities to or upon the written order of the Company, signed on
behalf of the Company by its Chairman of the Board or its President or a Vice Chairman of the Board
or a Vice President and attested to by its Secretary or an Assistant Secretary or by its Treasurer
or an Assistant Treasurer, without any further action by the Company. Before authenticating such
Securities and accepting the additional responsibilities under this Indenture in relation to such
Securities, the Trustee shall be entitled to receive, and (subject to Section 6.01) shall be fully
protected in relying upon:

(1) certified copies of the Articles of Incorporation and bylaws of the Company
(or an Officers’ Certificate with respect to any amendment thereto) and of any
resolutions of the Board of Directors authorizing the action taken pursuant to the
resolutions delivered pursuant to clause (2) below;

(2) a copy of any resolutions of the Board of Directors relating to such
Securities and by which the forms and terms of such Securities have been
established, in each case certified by the Secretary or an Assistant Secretary of
the Company;

(3) an executed supplemental indenture, if any;

(4) an Officers’ Certificate setting forth the form or forms and terms of the
Securities under Sections 2.01 and 2.03, respectively, and stating that no Event of
Default then exists and, in the case of a series of Original Issue Discount
Securities, the Yield to Maturity of such series; and

(5) an Opinion of Counsel, which shall state

(a) that the form or forms and terms of such Securities have been
established by the Board of Directors or by a supplemental indenture as
permitted by, and in conformity with, the provisions of this Indenture;

(b) that such Securities, when authenticated and delivered by the
Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid,
binding and enforceable obligations of the Company, subject to customary
exceptions; and

(c) such other matters as the Trustee may reasonably request.

The Trustee shall have the right to decline to authenticate and deliver any Securities under
this Section if the Trustee, being advised by counsel, determines that such action may not lawfully
be taken by the Company or if the Trustee in good faith shall determine that such action would (i)
expose the Trustee to personal liability to existing Securityholders or (ii) adversely affect the
Trustee’s own rights, duties or immunities under the Securities or hereunder.

SECTION 2.05. Execution of Securities. The Securities shall be signed on behalf of the
Company, manually or in facsimile, by its Chairman of the Board or its President or a Vice Chairman
of the Board or a Vice President either under its corporate seal (which may be in facsimile)
reproduced thereon and attested, manually or in facsimile, by its Secretary or an Assistant
Secretary or its Treasurer or an Assistant Treasurer, or not under its corporate seal, as the
Company may elect. Typographical and other minor errors or defects in any such reproduction of the
seal or any such signature shall not affect the validity or enforceability of any Security that has
been duly authorized and delivered by the Trustee.

In case any officer of the Company whose signature appears on any of the Securities, manually
or in facsimile, shall cease to be such officer before such Securities so signed shall have been
authenticated and delivered by the Trustee, or disposed of by the Company, such Securities
nevertheless may be authenticated and delivered by the Trustee, or disposed of by the Company, as
though the person whose signature appears on such Securities had not ceased to be such officer of
the Company; and any Security may be signed and the corporate seal reproduced thereon may be
attested, on behalf of the Company, manually or in facsimile, by such persons as, at the actual
date of the execution of such Security, shall be the proper officers of the Company, although at
the date of the execution of this Indenture any such person was not such officer.

Only such Securities as shall bear thereon a certificate of authentication substantially in
the form hereinbefore receipted, signed manually by an authorized signatory of the Trustee, shall
be entitled to the benefits of this Indenture or be valid or obligatory for any purpose. Such
certificate by the Trustee upon any Security executed by the Company shall be conclusive evidence
that the Security so authenticated has been duly authenticated and delivered hereunder and that the
holder is entitled to the benefits of this Indenture. Notwithstanding the foregoing, if any
Security shall have been duly authenticated and delivered hereunder but never issued and sold by
the Company, and the Company shall deliver such Security to the Trustee for cancellation as
provided in Section 2.09 together with a written statement stating that such Security has never
been issued and sold by the Company, for all purposes of this Indenture such Security shall be
deemed never to have been authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.

SECTION 2.06. Exchange of Securities. Securities of any series may be exchanged for a like
aggregate principal amount of Securities of the same series in other authorized denominations. The
Securities of any series to be exchanged shall be surrendered at the offices or agencies to be
maintained by the Company in accordance with the provisions of Section 3.02, and the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor the Security or
Securities that the Securityholder making the exchange shall be entitled to receive.

The Company shall keep, at one of the offices or agencies to be maintained by the Company in
accordance with the provisions of Section 3.02, a register or registers in which, subject to such
reasonable regulations as it or the Securities registrar may prescribe, the Company shall register
Securities and shall register the transfer of Securities as in this Article Two provided. Upon
surrender for registration of transfer of any Security at such office or agency, the Company shall
execute and the Trustee shall authenticate and deliver in the name of the transferee or transferees
a new Security or Securities of the same series that the Securityholder making the exchange shall
be entitled to receive, for a like aggregate principal amount.

All Securities presented or surrendered for exchange, registration of transfer, redemption or
payment shall, if so required by the Company or the Trustee, be duly endorsed by, or accompanied by
a written instrument or instruments of transfer in form satisfactory to the Company and the
Trustee, duly executed by the Securityholder or by his attorney who shall be so duly authorized in
writing.

No service charge shall be made for any exchange or registration of transfer of Securities,
but the Company or the Securities registrar may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto.

The Company shall not be required to exchange or register a transfer of (i) any Securities of
any series for a period of 15 days next preceding the first mailing of notice of redemption of
Securities of such series to be redeemed, or (ii) any Securities selected, called or being called
for redemption except, in the case of any Security where public notice has been given that such
Security is to be redeemed in part, the portion thereof not so to be redeemed.

Notwithstanding the foregoing, any Global Security shall be exchangeable pursuant to this
Section 2.06 for Securities registered in the names of persons other than the Depositary for such
Security or its nominee only if (i) such Depositary notifies the Company that it is unwilling or
unable to continue as Depositary for such Global Security or if at any time such Depositary ceases
to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, and the
Company fails to appoint a successor Depositary for such Global Security within 90 days after the
Company receives such notice or becomes aware of such event, (ii) the Company executes and delivers
to the Trustee written instructions that such Global Security shall be so exchangeable, or (iii)
there shall have occurred and be continuing an Event of Default or an event which, with the giving
of notice or lapse of time, or both, would constitute an Event of Default with respect to the
Securities. Any Global Security that is exchangeable pursuant to the preceding sentence shall be
exchangeable for Securities registered in such names as the Depositary shall direct.

Except as provided in the immediately preceding paragraph, a Global Security may not be
transferred except as a whole by the Depositary with respect to such Global Security to a nominee
of such Depositary or by a nominee of such Depositary to such Depositary or another nominee of such
Depositary or by such Depositary or any such nominee to a successor of such Depositary or a nominee
of such successor.

None of the Company, the Trustee, any Paying Agent or the Security Registrar will have any
responsibility or liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests of a Global Security or for maintaining, supervising or reviewing
any records relating to such beneficial ownership interests.

SECTION 2.07. Temporary Securities. Pending the preparation of definitive Securities of
any series, the Company may execute and the Trustee authenticate and deliver temporary Securities
of such series (printed, typewritten or otherwise reproduced) of any authorized denomination and
substantially in the form of the definitive Securities of such series, but with such omission,
insertions and variations as may be appropriate for temporary Securities of such series, all as may
be determined by the Company. Temporary Securities of any series may contain reference to any
provisions of this Indenture as may be appropriate. Every such temporary Security shall be
authenticated by the Trustee upon the conditions and in substantially the same manner, and with the
same effect, as the definitive Securities of such series. Without unnecessary delay, the Company
will execute and deliver to the Trustee definitive Securities of such series and thereupon any or
all temporary Securities of such series may be surrendered in exchange therefor, at the offices or
agencies to be maintained by the Company in accordance with the provisions of Section 3.02, and the
Trustee shall authenticate and deliver in exchange for such temporary Securities of such series an
equal aggregate principal amount of definitive Securities of such series. Until so exchanged, the
temporary Securities of such series shall in all respects be entitled to the same benefits under
this Indenture as definitive Securities of such series authenticated and delivered hereunder.

SECTION 2.08. Mutilated, Destroyed, Lost or Stolen Securities. In case any temporary or
definitive Security of any series shall become mutilated or be destroyed, lost or stolen, the
Company, in the case of any mutilated Security of any series shall, and in the case of any
destroyed, lost or stolen Security of any series in its discretion may, execute and upon its
request the Trustee shall authenticate and deliver, a new Security of the same series bearing a
number not contemporaneously outstanding in exchange and substitution for the mutilated Security,
or in lieu of and substitution for the Security so destroyed, lost or stolen, or, if any such
Security shall have matured or shall be about to mature, instead of issuing a substituted Security,
the Company may pay the same without surrender thereof except in the case of a mutilated Security.

In every case the applicant for a substituted Security or for such payment shall furnish to
the Company and to the Trustee such security or indemnity as may be required by them to save each
of them harmless from all risk, however remote, and, in every case of destruction, loss or theft,
the applicant shall also furnish to the Company and to the Trustee evidence to their satisfaction
of the destruction, loss or theft of such Security and of the ownership thereof. The Trustee may
authenticate any such substituted Security and deliver the same, or the Trustee or any Paying Agent
of the Company may make any such payment, upon the written request or authorization of any officer
of the Company, and shall incur no liability to anyone by reason of anything done or omitted to be
done by it in good faith under the provisions of this Section 2.08. Upon the issue of any
substituted Security, the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any expenses connected
therewith (including the fees and expenses of the Trustee).

Every substituted Security issued pursuant to the provisions of this Section 2.08 in
substitution for any destroyed, lost or stolen Securities shall constitute an additional
contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall
be found at any time, and shall be entitled to all the benefits of (but shall be subject to all the
limitations of rights set forth in) this Indenture equally and proportionately with any and all
other Securities duly issued hereunder.

All Securities shall be held and owned upon the express condition that the foregoing
provisions are exclusive with respect to the replacement or payment of mutilated, destroyed, lost
or stolen Securities, and shall preclude (to the extent lawful) any and all other rights or
remedies, notwithstanding any law or statute existing or hereafter enacted to the contrary with
respect to the replacement or payment of negotiable instruments or other securities without their
surrender.

SECTION 2.09. Cancellation of Surrendered Securities. All Securities surrendered for the
purpose of payment, redemption, exchange, substitution or registration of transfer, shall, if
surrendered to the Company or any Paying Agent or registrar, be delivered to the Trustee and the
same, together with Securities surrendered to the Trustee for cancellation, shall be promptly
canceled by it, and no Securities shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Indenture. The Trustee shall destroy canceled Securities and shall
deliver certificates of destruction thereof to the Company from time to time. If the Company shall
purchase or otherwise acquire any of the Securities, however, such purchase or acquisition shall
not operate as a payment, redemption or satisfaction of the indebtedness represented by such
Securities unless and until the Company, at its option, shall deliver or surrender the same to the
Trustee for cancellation.

SECTION 2.10. Securities in Global Form. If Securities of or within a series are issuable
in whole or in part in temporary or permanent global form, as specified as contemplated by Section
2.03, then, notwithstanding clause (8) of Section 2.03, any such Security shall represent such of
the outstanding Securities of such series as shall be specified therein and may provide that it
shall represent the aggregate amount of outstanding Securities from time to time endorsed thereon
and that the aggregate amount of outstanding Securities represented thereby may from time to time
be reduced to reflect exchanges. Any endorsement of a Security in global form to reflect the
amount, or any increase or decrease in the amount, or changes in the rights of holders, of
outstanding Securities represented thereby, shall be made by the Trustee in such manner and upon
instructions given by such person or persons as shall be specified therein or in the instructions
by the Company to be delivered to the Trustee pursuant to Section 2.04 or 2.07. Subject to the
provisions of Section 2.04 and, if applicable, Section 2.07, the Trustee shall deliver and
redeliver any Security in global form in the manner and upon instructions given by the person or
persons specified therein or in the applicable Company instructions. Any instructions by the
Company with respect to endorsement or delivery or redelivery of a Security in global form shall be
in writing but need not comply with Section 13.05 hereof and need not be accompanied by an Opinion
of Counsel.

ARTICLE THREE

PARTICULAR COVENANTS OF THE COMPANY

The Company covenants as follows:

SECTION 3.01. Payment of Principal of (and Premium, if any) and Interest on Securities.
The Company will duly and punctually pay or cause to be paid the principal of (and premium, if any)
and interest on each series of the Securities at the respective times and places and in the manner
provided in such Securities and this Indenture. Each payment from the Company to the Trustee or to
the Paying Agent shall be accompanied by a written notice that designates the series to which such
payment relates. As a condition precedent to the payment of any interest on a Security, the
Company or the Paying Agent may require the holder of such Security to furnish such evidence as
will enable the Company to determine whether it is required by law to deduct or to retain any tax
or taxes from the interest so payable. An installment of principal, premium or interest shall be
considered paid on the date it is due if the Trustee or Paying Agent holds by 11:00 a.m., New York
City time, on that date money designated for and sufficient to pay the installment.

SECTION 3.02. Maintenance of Office or Agency for Registration of Transfer, Exchange and
Payment of Securities. So long as any of the Securities shall remain outstanding, the Company
will maintain an office or agency in the continental United States, where the Securities may be
surrendered for exchange or registration of transfer as in this Indenture provided, and where
notices and demands to or upon the Company in respect of the Securities or of this Indenture may be
served, and where the Securities may be presented or surrendered for payment. The Company will
give to the Trustee prompt written notice of the location of any such office or agency and of any
change of location thereof. In case the Company shall fail to maintain any such required office or
agency or shall fail to give such notice of the location or of any change in the location thereof,
such surrenders, presentations and demands may be made and notices may be served at the principal
office of the Trustee, and the Company hereby appoints the Trustee its agent to receive at the
aforesaid office all such surrenders, presentations, notices and demands.

The Company may from time to time designate one or more other offices or agencies where the
Securities 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 Company of its obligation to maintain an office or agency in the continental
United States, for such purposes as stated in this Section. The Company will give prompt written
notice to the Trustee of any such designation or rescission and any change in the location of any
such office or agency.

SECTION 3.03. Appointment to Fill a Vacancy in the Office of Trustee. The Company,
whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the
manner provided in Section 6.10, a Trustee, so that there shall at all times be a Trustee
hereunder.

SECTION 3.04. Provision as to Paying Agent. (a) If the Company shall appoint a Paying
Agent other than the Trustee, it will cause such Paying Agent to execute and deliver to the Trustee
an instrument in which such agent shall agree with the Trustee, subject to the provisions of this
Section 3.04,

(1) that it will hold all sums held by it as such agent for the payment of the
principal of (and premium, if any) or interest on any series of Securities (whether
such sums have been paid to it by the Company or by any other obligor on such series
of Securities) in trust for the benefit of the persons entitled thereto until such
sums shall be paid to such persons or otherwise disposed of as herein provided;

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

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

(b) The Company will, prior to each due date of the principal of (and premium, if any) or
interest on any series of Securities, deposit with the Paying Agent a sum sufficient to pay the
principal (and premium, if any) or interest so becoming due, such sum to be held in trust for the
benefit of the holders of such series of Securities entitled to such principal, premium or
interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the
Trustee in writing of its failure so to act.

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

(d) Anything in this Section 3.04 to the contrary notwithstanding, the Company may, at any
time, for the purpose of obtaining a satisfaction and discharge with respect to one or more or all
series of Securities hereunder, or for any other reason, but only in accordance with Article
Eleven, pay or cause to be paid to the Trustee or any Paying Agent all sums held in trust for any
such series by it, or any Paying Agent hereunder, as required by this Section 3.04, such sums to be
held by the Trustee or such Paying Agent upon the trusts herein contained. Upon such payment by
any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability
with respect to such money.

(e) Anything in this Section 3.04 to the contrary notwithstanding, the agreement to hold sums
in trust as provided in this Section 3.04 is subject to the provisions of Sections 11.03 and 11.04.

SECTION 3.05. Maintenance of Corporate Existence. Subject to Article Ten, the Company will
at all times do or cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence and its franchise to be a corporation.

SECTION 3.06. Officers’ Certificate as to Default. The Company will, so long as any series
of Securities is outstanding, deliver to the Trustee, forthwith upon becoming aware of any default
or defaults in the performance of any covenant, agreement or condition contained in this Indenture,
an Officers’ Certificate specifying such default or defaults.

SECTION 3.07. Further Assurance. From time to time whenever reasonably demanded by the
Trustee, the Company will make, execute and deliver or cause to be made, executed and delivered any
and all such further and other instruments and assurances as may be reasonably necessary or proper
to carry out the intention of or to facilitate the performance of the terms of this Indenture or to
secure the rights and remedies hereunder of the holders of any series of Securities.

ARTICLE FOUR

SECURITYHOLDERS’ LISTS AND REPORTS BY THE COMPANY

AND THE TRUSTEE

SECTION 4.01. Company to Furnish Trustee Information as to Names and Addresses to
Securityholders. The Company will furnish or cause to be furnished to the Trustee a list in
such form as the Trustee may reasonably require containing all information in the possession or
control of the Company, or any of its Paying Agents other than the Trustee, as to the names and
addresses of the holders of the Securities of each series obtained since the date as of which the
next previous list if any, was furnished:

(a) semi-annually, not more than 15 days after each record date for the payment of semi-annual
interest on such Securities, as hereinabove specified, as of such record date and not less than
once every six months for non-interest bearing Securities in each year, and

(b) at such other times as the Trustee may request in writing, within 30 days after the
receipt by the Company of any such request, a list of similar form and content as of a date not
more than 15 days prior to the time such list is furnished; provided, that such list need not
include information received after such date, provided, however, that so long as the Trustee is the
Security registrar, no such list shall be required to be furnished.

SECTION 4.02. Preservation and Disclosure of Lists. (a) The Trustee shall preserve, in as
current a form as is reasonably practicable, all information as to the names and addresses of the
holders of Securities (1) contained in the most recent list furnished to it as provided in Section
4.01 and (2) received by it in the capacity of Paying Agent (if so acting) and Security registrar
(if so acting).

The Trustee may destroy any list furnished to it as provided in Section 4.01 upon receipt of a
new list so furnished.

(b) Securityholders may communicate pursuant to Section 312(b) of the Trust Indenture Act of
1939 with other Securityholders with respect to their rights under this Indenture or any or all
series of the Securities.

(c) Each and every Securityholder, by receiving and holding the same, agrees with the Company
and the Trustee that neither the Company nor the Trustee nor any Paying Agent nor the Security
registrar shall be held accountable by reason of the disclosure of any such information as to the
names and addresses of the holders of Securities in accordance with the provisions of subsection
(b) of this Section 4.02, regardless of the source from which such information was derived, and
that the Trustee shall not be held accountable by reason of mailing any material pursuant to a
request made under said subsection (b).

SECTION 4.03. Reports by the Company. (a) The Company covenants and agrees to file with
the Trustee, within 30 days after the Company 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) that the Company may be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934, as amended; or, if the Company is not
required to file information, documents or reports pursuant to either of such sections, then to
file with the 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 that may be required pursuant to Section 13 of the Securities Exchange Act of 1934, as
amended, 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.

(b) The Company covenants and agrees to file with the Trustee and the Commission, in
accordance with the rules and regulations prescribed from time to time by the Commission, such
additional information, documents, and reports with respect to compliance by the Company with the
conditions and covenants provided for in this Indenture as may be required from time to time by
such rules and regulations.

(c) The Company covenants and agrees to transmit to the holders of Securities within 30 days
after the filing thereof with the Trustee, in the manner and to the extent provided in subsection
(c) of Section 4.04 with respect to reports pursuant to subsection (a) of said Section 4.04, such
summaries of any information, documents and reports required to be filed by the Company pursuant to
subsections (a) and (b) of this Section 4.03 as may be required by rules and regulations prescribed
from time to time by the Commission.

(d) The Company covenants and agrees to furnish to the Trustee, not less often than annually,
a brief certificate from the principal executive officer, principal financial officer or principal
accounting officer of the Company as to his or her knowledge of the Company’s compliance with all
conditions and covenants under this Indenture; provided, for purposes of this paragraph, such
compliance shall be determined without regard to any period of grace or requirement of notice
provided under this Indenture.

SECTION 4.04. Reports by the Trustee. (a) On or before July 14, 2005, and on or before
July 14th in every year thereafter, so long as any Securities are outstanding hereunder, if such
report is required by the Trust Indenture Act of 1939, the Trustee shall transmit to the
Securityholders of each series, as hereinafter in this Section 4.04 provided, a brief report dated
as of May 15th of the year in which such report is made that complies with Section 313(a) of the
Trust Indenture Act of 1939.

(b) The Trustee shall also comply with Section 313(b)(2) of the Trust Indenture Act of 1939.

(c) Reports pursuant to this Section 4.04 shall be transmitted by mail to all Securityholders,
as the names and addresses of such holders appear upon the registry books of the Company and to all
other person to whom such reports are required to be transmitted pursuant to Section 313(c) of the
Trust Indenture Act of 1939.

(d) A copy of each such report shall, at the time of such transmission to holders of
Securities, be filed by the Trustee with each stock exchange upon which the Securities of any
applicable series are listed and also with the Commission. The Company will notify the Trustee
when and as the Securities of such series become listed on any stock exchange and provide
appropriate contact information.

ARTICLE FIVE

REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS

ON EVENT OF DEFAULT

SECTION 5.01. Events of Default Defined; Acceleration of Maturity; Waiver of Default. In
case one or more of the following Events of Default with respect to Securities of any series shall
have occurred and be continuing, that is to say:

(a) default in the payment of any installment of interest upon any of the Securities of such
series as and when the same shall become due and payable, and continuance of such default for a
period of 30 days;

(b) default in the payment of the principal of (and premium, if any, on) any of the Securities
of such series as and when the same shall become due and payable either at stated maturity, by
declaration or otherwise;

(c) failure on the part of the Company duly to observe or perform in any material respect any
other of the covenants or agreements on the part of the Company in the Securities of such series or
contained in this Indenture for a period of 90 days after the date on which written notice
specifying such failure, stating that such notice is a “Notice of Default” hereunder and, requiring
the same to be remedied, shall have been given to the Company by the Trustee, or to the Company and
the Trustee by the holders of at least 25% in aggregate principal amount of the Securities of such
series at the time outstanding;

(d) default under the terms of any agreement or instrument evidencing, or under which the
Company has at the date of this Indenture or hereafter outstanding, any indebtedness for borrowed
money and such indebtedness shall be accelerated so that the same shall be or become due and
payable prior to the date on which the same would otherwise become due and payable and the
aggregate principal amount thereof so accelerated exceeds $50,000,000 and such acceleration is not
rescinded or annulled within ten days after there has been given, by registered or certified mail,
to the Company by the Trustee or to the Company and the Trustee by the holders of at least 25% in
aggregate principal amount of the outstanding Securities of that series a written notice specifying
such default and stating that such notice is a “Notice of Default” hereunder; (it being understood
however, that, subject to the provisions of Section 6.01, the Trustee shall not be deemed to have
knowledge of such default under such agreement or instrument unless either (A) a Responsible
Officer of the Trustee shall have actual knowledge of such default or (B) a Responsible Officer of
the Trustee shall have received written notice thereof from the Company, from any Securityholder,
from the holder of any such indebtedness or from the trustee under any such agreement or other
instrument); provided, however, that if such default under such agreement or instrument is remedied
or cured by the Company or waived by the holders of such indebtedness, then the Event of Default
hereunder by reason thereof shall be deemed likewise to have been thereupon remedied, cured or
waived without further action upon the part of either the Trustee or any of such Securityholders;

(e) a court having jurisdiction in the premises shall enter a decree or order for relief in
respect of the Company in an involuntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of the Company or for any substantial part of its
property, or ordering the winding-up or liquidation of its affairs, and such decree or order shall
remain unstayed and in effect for a period of 60 consecutive days; or

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

then and in each and every such case, unless the principal of all the Securities of such series
shall have already become due and payable, either the Trustee or the holders of not less than 25%
in aggregate principal amount of the Securities of such series then outstanding hereunder, by
notice in writing to the Company (and to the Trustee if given by Securityholders), may declare the
principal of all the Securities of such series (or, if the Securities of such series are Original
Issue Discount Securities, such portion of the principal amount as may be specified in the terms of
that series) of all Securities of such series and the interest accrued thereon, if any, to be due
and payable immediately, and upon any such declaration the same shall become and shall be
immediately due and payable, anything in this Indenture or in the Securities contained to the
contrary notwithstanding. This provision, however, is subject to the condition that if, at any time
after the principal (or, if the Securities are Original Issue Discount Securities, such portion of
the principal as may be specified in the terms thereof) of the Securities of any series (or of all
the Securities, as the case may be) shall have been so declared due and payable, and before any
judgment or decree for the payment of the moneys due shall have been obtained or entered as
hereinafter provided, the Company shall pay or shall deposit with the Trustee a sum sufficient to
pay all matured installments of interest upon all the Securities of such series (or of all the
Securities, as the case may be) and the principal of (and premium, if any, on) all Securities of
such series (or of all the Securities, as the case may be) that shall have become due otherwise
than by declaration (with interest on overdue installments of interest to the extent permitted by
law, and on such principal and premium, if any, at the rate of interest borne by the Securities or
Yield to Maturity (in the case of Original Issue Discount Securities) applicable to the Securities
of such series (or at the respective rates of interest or Yields to Maturity of all the Securities,
as the case may be) to the date of such payment or deposit) and the expenses of the Trustee, and
any and all defaults under this Indenture, other than the nonpayment of principal of and accrued
interest on Securities that shall have become due by declaration, shall have been remedied, then
and in every such case the Securityholders of a majority in aggregate principal amount of the
Securities of such series (or of all the Securities, as the case may be) then outstanding, by
written notice to the Company and to the Trustee, may waive all defaults with respect to that
series, each such series voting as a separate class (or with respect to all Securities, as the case
may be, in such case treated as a single class) and rescind and annul such declaration and its
consequences; but no such waiver of rescission and annulment shall extend to or shall affect any
subsequent default, or shall impair any right consequent thereon.

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

SECTION 5.02. Payment of Securities on Default; Suit Therefor. The Company covenants that
(1) in case default shall be made in the payment of any installment of interest on any of the
Securities of any series, as and when the same shall become due and payable, and such default shall
have continued for a period of 30 days or (2) in case default shall be made in the payment of the
principal of (or premium, if any, on) any of the Securities of any series when the same shall have
become due and payable, whether upon maturity of the Securities for such series or otherwise,
including any sinking fund payment, then, upon demand of the Trustee, the Company will pay to the
Trustee for the benefit of the holders of the Securities of such series (and shall designate which
series) the whole amount that then shall have become due and payable on all Securities of such
series for principal (and premium, if any) or interest, or both, as the case may be, with interest
on the overdue principal (and premium, if any) and installments of interest (to the extent
permitted by law) at the rate of interest or Yield to Maturity (in the case of Original Issue
Discount Securities) borne by such series of Securities; and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection, including a reasonable
compensation to the Trustee, its agents, attorneys and counsel, and any expenses or liabilities
incurred by the Trustee hereunder other than through its negligence or bad faith.

Until such demand is made by the Trustee, the Company may pay the principal of (and premium,
if any, on) and interest on the Securities of any series to the holders thereof, whether or not the
Securities of such series be overdue.

In case the Company shall fail forthwith to pay such amounts upon such demand, the Trustee, in
its own name and as trustee of an express trust, shall be entitled and empowered to institute any
action or proceedings at law or in equity for the collection of the sums so due and unpaid, and may
prosecute any such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor upon such Securities, and collect
in the manner provided by law out of the property of the Company or any other obligor upon such
Securities wherever situated the moneys adjudged or decreed to be payable.

In case there shall be pending proceedings for the bankruptcy or for the reorganization of the
Company or any other obligor upon the Securities of any series under the Bankruptcy Code or any
other applicable law or in connection with the insolvency of the Company or any other obligor upon
any Securities or in the case a receiver or trustee shall have been appointed for its property, or
in case of any other judicial proceedings relative to the Company or any other obligor upon such
series of Securities or to creditors or property of the Company or such other obligor, the Trustee,
irrespective of whether the principal of such series of Securities shall then be due and payable as
therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall
have made any demand pursuant to the provisions of this Section 5.02, shall be entitled and
empowered by intervention in such proceedings or otherwise, to file and prove a claim or claims for
the whole amount of principal, premium, if any, and interest (or if the Securities of any series
are Original Issue Discount Securities, such portion of the principal amount as may be specified in
the terms of that series) owing and unpaid in respect of the Securities of any series, and to file
such other papers or documents as may be necessary or advisable in order to have the claims of the
Trust and of the Securityholders allowed in any judicial proceedings relative to the Company or any
other obligor upon the Securities of any series, its creditors, or its property, and to collect and
receive any moneys or other property payable or deliverable on any such claims, and to distribute
the same after the deduction of its charges and expenses; and any receiver, assignee or trustee in
bankruptcy or reorganization is hereby authorized by each of such holders to make such payments to
the Trustee, and, in the event that the Trustee shall consent to the making of such payments
directly to the holders, to pay to the Trustee any amount due it for compensation and expenses,
including counsel fees incurred by it up to the date of such distribution. To the extent that such
payment of reasonable compensation, expenses, liabilities and counsel fees out of the estate in any
such proceedings shall be denied for any reason (except as a result of negligence or bad faith),
payment of the same shall be secured by a lien on, and shall be paid out of, any and all
distributions, dividends, moneys, securities and other property that the holders of the Securities
of any series may be entitled to receive in such proceedings, whether in liquidation or under any
plan of reorganization or arrangement or otherwise.

All rights of action and of asserting claims under this Indenture, or under any of the
Securities of any series, may be enforced by the Trustee without the possession of any of the
Securities, or the production thereof at any trial or other proceeding relative thereto, and any
such suit or proceeding instituted by the Trustee shall be brought in its own name and as trustee
of an express trust, and any recovery of judgment shall be for the ratable benefit of the holders
of the Securities and the Trustee.

SECTION 5.03. Application of Moneys Collected by Trustee. Any moneys collected by the
Trustee pursuant to Section 5.02 with respect to any one or more series shall be applied in the
order following, at the date or dates fixed by the Trustee for the distribution of such moneys,
and, in the case of the distribution of such moneys on account of principal or interest, upon
presentation of the several Securities of a series in respect of which moneys have been collected,
and stamping (or otherwise noting) thereon the payment, or issuing Securities of such series in
reduced principal amounts in exchange for the presented Securities of such series if only partially
paid, and upon surrender thereof if fully paid:

FIRST: To the payment of costs and expenses of collection applicable to such series,
and reasonable compensation to the Trustee, its agents, attorneys and counsel, and of all
other expenses and liabilities incurred, and all advances made, by the Trustee with respect
to such series, except as a result of its negligence or bad faith;

SECOND: In case no principal of the outstanding Securities of such series shall have
become due and be unpaid, to the payment of interest on the Securities of such series in
default, in the order of the maturity of the installments of such interest, with interest
upon the overdue installments of interest (so far as permitted by law and to the extent that
such interest has been collected by the Trustee) at the rate of interest or Yield to
Maturity (in the case of Original Issue Discount Securities) borne by the Securities of such
series; and in case such moneys shall be insufficient to pay in full the whole amount so due
and unpaid upon the Securities of such series, then to the payment of such principal (and
premium, if any) and interest, without preference or priority of principal (and premium, if
any) over interest, or of interest over principal (and premium, if any), or of any
installment of interest over any other installment of interest or of any Security of such
series over any other Security of such series, ratably according to the aggregate of such
principal (and premium, if any) and accrued and unpaid interest; and

THIRD: To the payment of the remainder, if any, to the Company, its successors or
assigns, or to whosoever may be lawfully entitled to receive the same or as a court of
competent jurisdiction may direct.

SECTION 5.04. Limitation on Suits by Holders of Securities. No holder of a Security of any
series shall have any right by virtue or by availing of any provision of this Indenture to
institute any suit, action or proceeding in equity or at law or in bankruptcy or otherwise, upon or
under or with respect to this Indenture or for the appointment of a receiver, liquidating
custodian, trustee or similar official, or for any other remedy hereunder, unless such holder
previously shall have given to the Trustee written notice of default and of the continuance
thereof, as hereinabove provided, and unless also the holders of not less than 25% in aggregate
principal amount of such series of Securities then outstanding shall have made written request upon
the Trustee to institute such action, suit or proceeding in its own name as Trustee hereunder and
shall have offered to the Trustee such reasonable indemnity or security as it may require against
the costs, expenses and liabilities to be incurred therein or thereby, and the Trustee, for 60 days
after its receipt of such notice, request and offer of indemnity, shall have neglected or refused
to institute any such action, suit or proceeding and no direction inconsistent with such written
request shall have been given to the Trustee pursuant to Section 5.06; it being understood and
intended, and being expressly covenanted by the holder of every Security of a series with every
other Securityholder and the Trustee, that no one or more holders of such series of Securities
shall have any right in any manner whatsoever by virtue or by availing of any provision of this
Indenture to affect, disturb or prejudice the rights of the holders of any other series of
Securities, or to obtain or seek to obtain priority over or preference to any other such holder, or
to enforce any right under this Indenture, except in the manner herein provided and for the equal,
ratable and common benefit of all holders of Securities. For the protection and enforcement of the
provisions of this Section 5.04, each and every Securityholder and the Trustee shall be entitled to
such relief as can be given either at law or in equity.

Notwithstanding any other provisions in this Indenture, the right of any holder of any
Security to receive payment of the principal of (and premium, if any) and interest on such
Security, on or after the respective due dates expressed in such Security, or to institute suit for
the enforcement of any such payment on or after such respective dates, shall not be impaired or
affected without the consent of such holder.

SECTION 5.05. Proceedings by Trustee; Remedies Cumulative and Continuing. In case an Event
of Default has occurred, has not been waived, and is continuing, the Trustee may in its discretion
proceed to protect and enforce the rights vested in it by this Indenture by such appropriate
judicial proceedings as the Trustee shall deem most effectual to protect and enforce any of such
rights, either by suit in equity or by action at law or by proceeding in bankruptcy or otherwise,
whether for the specific enforcement of any covenant or agreement contained in this Indenture or in
aid of the exercise of any power granted in this Indenture, or to enforce any other legal or
equitable right vested in the Trustee by this Indenture or by law. All powers and remedies given
by this Article Five to the Trustee or to the Securityholders shall, to the extent permitted by
law, be deemed cumulative and not exclusive of any thereof or any other powers and remedies
available to the Trustee or to the holders of the Securities, by judicial proceedings or otherwise,
to enforce the performance or observance of the covenants and agreements contained in this
Indenture, and no delay or omission of the Trustee or of any holder of any of the Securities to
exercise any right or power accruing upon any default occurring and continuing as aforesaid shall
impair any such right or power, or shall be construed to be a waiver of any such default or any
acquiescence therein; and, subject to the provisions of Section 5.04, every power and remedy given
by this Article Five or by law to the Trustee or to the Securityholders may be exercised from time
to time, and as often as shall be deemed expedient, by the Trustee or by the Securityholders.

SECTION 5.06. Rights of Holders of Majority in Principal Amount of Securities to Direct Trustee
and to Waive Defaults. The holders of a majority in aggregate principal amount of the
Securities of all series affected (voting as one class) at the time outstanding (determined as
provided in Section 7.04), or, if a record date is set in accordance with Section 7.05, as of such
record date, shall have the right to direct the time, method, and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on
the Trustee by this Indenture with respect to the Securities of such series; provided, however,
that subject to the provisions of Section 6.01, the Trustee shall have the right to decline to
follow any such direction if the Trustee being advised by counsel shall determine that the action
so directed may not lawfully be taken, or if the Trustee in good faith shall, by a Responsible
Officer or Officers of the Trustee, determine that the proceedings so directed would be illegal or
expose it to personal liability or be unjustly prejudicial to the Securityholders not consenting,
and provided further that nothing in this Indenture shall impair the right of the Trustee in its
discretion to take any action deemed proper by the Trustee and which is not inconsistent with such
direction by the Securityholders. Prior to the declaration of the maturity of the Securities of
any series as provided in Section 5.01, the holders of a majority in aggregate principal amount of
the Securities of such series at the time outstanding (each such series voting as a separate class)
(determined as provided in Sections 7.04 and 7.05) may on behalf of the holders of all of the
Securities of such series waive any past default hereunder and its consequences, except a default
in the payment of interest or premium on, or the principal of, any of the Securities. In the case
of any such waiver the Company, the Trustee and the holders of the Securities of such series shall
be restored to their former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other default or impair any right consequent hereon.

SECTION 5.07. Trustee to Give Notice of Defaults Known to It, But May Withhold in Certain
Circumstances. The Trustee shall, within 90 days after the occurrence of a default hereunder,
give to the Securityholders, in the manner and to the extent provided in subsection (c) of Section
4.04 with respect to reports pursuant to subsection (a) of Section 4.04, notice of such defaults
known to the Trustee unless such default shall have been cured or waived before the giving of such
notice (the term “defaults” for the purposes of this Section 5.07 being hereby defined to be the
events specified in clauses (a), (b), (c), (d), (e) and (f) of Section 5.01, not including any
periods of grace provided for therein, and irrespective of the giving of any required notice);
provided that, except in the case of default in the payment of the principal of (and premium, if
any) or interest on any of the Securities of such series, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive committee, or a
trust committee of directors and/or Responsible Officers of the Trustee in good faith determined
that the withholding of such notice is in the interest of the Securityholders of such series.

SECTION 5.08. Requirement of an Undertaking to Pay Costs in Certain Suits Under this Indenture
or Against the Trustee. All parties to this Indenture agree, and each holder of any Security
by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion
require, in any suit for the enforcement or any right or remedy under this Indenture, or in any
suit against the Trustee for any action taken or omitted by it as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorney’s 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 5.08 shall not apply to any suit
instituted by the Trustee, to any suit instituted by any Securityholder, or group of
Securityholders of any series, holding in the aggregate more than ten percent in aggregate
principal amount of the Securities of such series outstanding, or to any suit instituted by any
Securityholder for the enforcement of the payment of the principal of (and premium, if any) or
interest on any Security, on or after the due date expressed in such Security.

ARTICLE SIX

CONCERNING THE TRUSTEE

SECTION 6.01. Duties and Responsibilities of Trustee. The Trustee, prior to the occurrence
of an Event of Default and after the curing or waiving of all Events of Default that may have
occurred with respect to the Securities of a series, undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture. In case an Event of Default has
occurred of which a Responsible Officer of the Trustee has actual knowledge (which has not been
cured or waived) the Trustee shall exercise such of the rights and powers vested in it by this
Indenture with respect to the Securities of a series, and use the same degree of care and skill in
their exercise as a prudent man would exercise or use under the circumstances in the conduct of his
own affairs.

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

(a) prior to the occurrence of an Event of Default with respect to the Securities of any
series and after the curing or waiving of all Events of Default with respect to such series that
may have occurred

(1) the duties and obligations of the Trustee shall be determined solely by the
express provisions of this Indenture, and the Trustee shall only be liable for the
performance of such duties and obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be read into this Indenture
against the Trustee; and

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

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

(c) the Trustee shall not be liable with respect to any action taken or omitted to be taken by
it in good faith in accordance with the direction of the holders of not less than a majority in
principal amount of the Securities of all series affected (voting as a class) at the time
outstanding (determined as provided in Sections 7.04 and 7.05) relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred upon the Trustee, under this Indenture.

None of the provisions contained in this Indenture shall require the Trustee to expend or risk
its own funds or otherwise incur personal financial liability in the performance of any of its
duties hereunder or in the exercise of any of its rights or powers, if there is reasonable grounds
for believing that the repayment of such funds or adequate indemnity against such risk or liability
is not reasonably assured to it.

SECTION 6.02. Reliance on Documents, Opinions, etc. Subject to the provisions of Section
6.01:

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

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

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

(d) The Trustee shall be under no obligation to exercise any of the rights or powers vested in
it by this Indenture at the request, order or direction of any of the Securityholders, pursuant to
the provisions of this Indenture, unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities that may be incurred
therein or thereby; but nothing herein contained shall, however, relieve the Trustee of the
obligation, upon the occurrence of an Event of Default (which has not been cured or waived), to
exercise such of the rights and powers vested in it by this Indenture, and to use the same degree
of care and skill in their exercise, as a prudent man would exercise or use under the circumstances
in the conduct of his own affairs;

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

(f) The Trustee shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent,
order approval, bond, note or other paper or document, unless requested in writing so to do by the
holders of not less than a majority in aggregate principal amount of the Securities of all series
affected then outstanding voting as one class (determined as provided in Sections 7.04 and 7.05);
provided, however, that if the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such investigation is, in the
opinion of the Trustee, not reasonably assured to the Trustee by the security afforded to it by the
terms of this Indenture, the Trustee may require reasonable indemnity against such expense or
liability as a condition to so proceeding. The reasonable expense of every such examination shall
be paid by the Company or, if paid by the Trustee, shall be repaid by the Company upon demand; and

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

The permissive right of the Trustee to do anything enumerated in this Section 6.02 shall not be
construed as a duty.

SECTION 6.03. No Responsibility for Recitals, etc. The statements and recitals contained
herein and in the Securities and in any other document in connection with the sale of the
Securities (other than the certificate of authentication of the Securities) shall be taken as the
statements of the Company, and the Trustee assumes no responsibility for the correctness of the
same. The Trustee makes no representation as to the validity or sufficiency of this Indenture or
of the Securities. The Trustee shall not be accountable for the use or application by the Company
of any of the Securities or of the proceeds of such Securities, or for the use or application of
any moneys paid over by the Trustee in accordance with any provision of this Indenture, or for the
use or application of any moneys received by any Paying Agent other than the Trustee.

SECTION 6.04. Trustee, Paying Agent or Security Registrar May Own Securities. The Trustee
or any Paying Agent or Security registrar, in its individual or any other capacity, may become the
owner or pledgee of Securities and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee, Paying Agent or Security
registrar.

SECTION 6.05. Moneys Received by Trustee to be Held in Trust Without Interest. Subject to
the provisions of Section 11.04, all moneys received by the Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they were received, but need not be
segregated from other funds except to the extent required by law. The Trustee shall be under no
liability for interest on moneys received by it hereunder except such as it may agree with the
Company to pay thereon. So long as no Event of Default shall have occurred and be continuing, all
interest allowed on any such moneys shall be paid from time to time upon the written order of the
Company, signed by its Chairman of the Board, any Vice Chairman of the Board, its President or any
Vice President or its Treasurer or any Assistant Treasurer.

SECTION 6.06. Compensation and Expenses of Trustee. The Company covenants and agrees to
pay to the Trustee from time to time, and the Trustee shall be entitled to, reasonable compensation
(which shall not be limited by any provision of law in regard to the compensation of a Trustee of
an express trust), and the Company will promptly pay or reimburse the Trustee upon its request for
all reasonable expenses, disbursements and advances incurred or made by the Trustee in connection
with the acceptance or administration of its trust under this Indenture (including the reasonable
compensation and the expenses and disbursements of its counsel and of all persons not regularly in
its employ) except any such expense, disbursement or advance as may arise from its negligence or
bad faith. The Company also covenants to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or bad faith on the part of the
Trustee and arising (a) out of or in connection with the acceptance or administration of this
trust, or (b) from any action or failure to act as authorized or within the discretion or rights or
powers conferred upon the Trustee hereunder, including the costs and expenses of defending itself
against any claim of liability in the premises. The obligations of the Company under this Section
6.06 to compensate the Trustee and to pay or reimburse the Trustee for expenses, disbursements,
losses, liabilities and advances shall constitute additional indebtedness hereunder and shall
survive the resignation or removal of the Trustee and the satisfaction and discharge of this
Indenture. Such additional indebtedness shall be secured by a lien prior to that of the Securities
upon all property and funds held or collected by the Trustee as such, except funds held in trust
for the benefit of the holders of particular Securities.

SECTION 6.07. Right of Trustee to Rely on Officers’ Certificate Where No Other Evidence
Specifically Prescribed. Subject to the provisions of Section 6.01, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it necessary or desirable
that a matter be proved or established prior to taking, suffering or omitting any action hereunder,
such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in
the absence of negligence or bad faith on the part of the Trustee, be deemed to be conclusively
proved and established by an Officers’ Certificate delivered to the Trustee, and such Certificate,
in the absence of negligence or bad faith on the part of the Trustee, shall be full warrant to the
Trustee for any action taken, suffered or omitted by it under the provisions of this Indenture upon
the faith thereof.

SECTION 6.08. Conflicting Interest of Trustee. (a) If, after an Event of Default has
occurred and is continuing, the Trustee has or shall acquire any conflicting interest, as defined
in this Section 6.08, it shall, within 90 days after ascertaining that it has such conflicting
interest, either eliminate such conflicting interest or, unless the Trustee’s duty to resign is
stayed as provided in Section 310(b) of the Trust Indenture Act of 1939, resign in the manner and
with the effect specified in Section 6.10, such resignation to become effective upon the
appointment of a successor trustee and such successor’s acceptance of such appointment, and the
Company shall take prompt steps to have a successor appointed in the manner provided in Section
6.10.

(b) In the event that the Trustee shall fail to comply with the provisions of subsection (a)
of this Section 6.08, the Trustee shall, within 10 days after the expiration of such 90-day period,
or, if the Trustee’s duty to resign is stayed, after the end of such stay, transmit notice of such
failure to the Securityholders in the manner and to the extent provided in subsection (c) of
Section 4.04 with respect to reports pursuant to subsection (a) of Section 4.04.

(c) For the purposes of this Section 6.08, the Trustee shall be deemed to have a conflicting
interest if the Trustee has a conflict within the provisions of Section 310(b) of the Trust
Indenture Act of 1939.

SECTION 6.09. Requirements for Eligibility of Trustee. The Trustee hereunder shall at all
times be a corporation organized and doing business under the laws of the United States or any
State or territory thereof or of the District of Columbia authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least five million dollars,
subject to supervision or examination by Federal, State, Territorial, or District of Columbia
authority. If such corporation publishes reports of condition at least annually, pursuant to law
or to the requirements of the aforesaid supervising or examining authority, then for the purposes
of this Section 6.09, the combined capital and surplus of such corporation shall be deemed to be
its combined capital and surplus as set forth in its most recent report of condition so published.
In case at any time the Trustee shall cease to be eligible in accordance with the provisions of
this Section 6.09, the Trustee shall resign immediately in the manner and with the effect specified
in Section 6.10. Neither the Company nor any persons directly or indirectly controlling,
controlled by, or under common control with the Company shall serve as Trustee.

SECTION 6.10. Resignation or Removal of Trustee. (a) The Trustee, or any Trustee
hereafter appointed, may at any time resign with respect to one or more series of Securities by
giving written notice of such resignation to the Company or to the Securityholders, such notice to
the Securityholders of applicable series of Securities to be given by mailing (by first class mail)
the same. Upon receiving such notice of resignation, the Company shall promptly appoint a
successor trustee with respect to the applicable series by written instrument, in duplicate,
executed by order of the Board of Directors of the Company, one copy of which instrument shall be
delivered to the resigning Trustee and one copy to the successor trustee. If no successor trustee
shall have been so appointed and have accepted appointment within 60 days after the mailing of such
notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for
the appointment of a successor trustee, or any Securityholder who has been a bona fide holder of a
Security or Securities for at least six months may, subject to the provisions of Section 5.08, on
behalf of himself and all others similarly situated, petition any such court for the appointment of
a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper
and prescribe, appoint a successor trustee.

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

(1) the Trustee shall fail to comply with the provisions of subsection (a) of
Section 6.08 with respect to any series of Securities after written request therefor
by the Company or by any Securityholder who has been a bona fide holder of a
Security or Securities of such series for at least six months, or

(2) the Trustee shall cease to be eligible in accordance with the provisions of
Section 6.09 and shall fail to resign after written request therefor by the Company
or by any such Securityholder, or

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

then, in any such case, the Company may remove the Trustee with respect to the applicable series
and appoint a successor trustee for such series by written instrument, in duplicate, executed by
order of the Board of Directors of the Company, one copy of which instrument shall be delivered to
the Trustee so removed and one copy to the successor trustee, or, subject to the provisions of
Section 5.08, any Securityholder who has been a bona fide holder of a Security or Securities of
such series for at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Trustee and the appointment of
a successor trustee with respect to such series. Such court may thereupon, after such notice, if
any, as it may deem proper and prescribe, remove the Trustee and appoint a successor trustee.

(c) The holders of a majority in aggregate principal amount of the Securities of all series at
the time outstanding voting as one class (determined as provided in Section 7.04) may at any time
remove the Trustee with respect to Securities of all series and appoint a successor trustee with
respect to securities of all series by written instrument or instruments signed by such holders or
their attorneys-in-fact duly authorized, or by the affidavits of the permanent chairman and
secretary of a meeting of the Securityholders evidencing the vote upon a resolution or resolutions
submitted thereto with respect to such removal and appointment (as provided in Article Eight), and
by delivery thereof to the Trustee so removed, to the successor trustee and to the Company.

(d) Any resignation or removal of the Trustee and appointment of any successor trustee
pursuant to any of the provisions of this Section 6.10 shall become effective upon acceptance of
appointment by the successor trustee as provided in Section 6.11.

SECTION 6.11. Acceptance by Successor to Trustee; Notice of Succession of a Trustee. Any
successor trustee appointed as provided in Section 6.10 shall execute, acknowledge and deliver to
the Company and to its predecessor trustee an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor trustee with respect to all or any
particular series shall become effective and such successor trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, duties and obligations with respect
to such series of its predecessor hereunder, with like effect as if originally named as Trustee
herein; but, nevertheless, on the written request of the Company or of the successor trustee, the
Trustee ceasing to act shall, upon payment of any amounts then due it pursuant to the provisions of
Section 6.06, pay over to the successor trustee, subject to Section 11.04, all monies at the time
held by it hereunder with respect to such series, and execute and deliver an instrument
transferring to such successor trustee all the rights and powers of the trustee so ceasing to act.
Upon request of any such successor trustee, the Company shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor trustee all such
rights and powers. Any Trustee ceasing to act shall, nevertheless, retain a lien upon all property
or funds held or collected by such Trustee, except funds held in trust for the benefit of the
holders of particular Securities, to secure any amounts then due it pursuant to the provisions of
Section 6.06.

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

No successor trustee with respect to any series of Securities shall accept appointment as
provided in this Section 6.11 unless at the time of such acceptance such successor trustee shall be
qualified under the provisions of Section 6.08 and eligible under the provisions of Section 6.09.

Upon acceptance of appointment by a successor trustee as provided in this Section 6.11, the
Company shall mail to the holders of Securities of any series by first-class mail notice thereof.
If the Company fails to mail such notice within 30 days after acceptance of appointment by the
successor trustee, the successor trustee shall, in its discretion, cause such notice to be mailed
at the expense of the Company.

SECTION 6.12. Successor to Trustee by Merger, Consolidation or Succession to Business. Any
corporation into which the Trustee may be merged or converted or with which it may be consolidated,
or any corporation resulting from any merger or conversion or consolidation to which the Trustee
shall be a party, or any corporation succeeding to the corporate trust business of the Trustee,
shall be the successor of the Trustee hereunder, provided such corporation shall be qualified under
the provisions of Section 6.08 and eligible under the provisions of Section 6.09, without the
execution or filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.

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

SECTION 6.13. Limitations on Rights of Trustee as a Creditor. The Trustee shall comply
with Section 311 of the Trust Indenture Act of 1939.

ARTICLE SEVEN

CONCERNING THE SECURITYHOLDERS

SECTION 7.01. Evidence of Action by Securityholders. Whenever in this Indenture it is
provided that the holders of a specified percentage in aggregate principal amount of the Securities
of any or all series may take any action (including the making of any demand or request, the giving
of any notice, consent, or waiver or the taking of any other action) the fact that the holders of
such specified percentage, determined as of the time such action was taken or, if a record date was
set with respect thereto pursuant to Section 7.05, as of such record date, have joined therein may
be evidenced (a) by any instrument or any number of instruments of similar tenor executed by
Securityholders in person or by agent or proxy appointed in writing, or (b) by the record of the
holders of Securities voting in favor thereof at any meeting of Securityholders duly called and
held in accordance with the provisions of Article Eight, or (c) by a combination of such instrument
or instruments and any such record of such a meeting of Securityholders, or (d) in the case of
Securities evidenced by a Global Security, by any electronic transmission or other message, whether
or not in written format, that complies with the Depositary’s applicable procedures.

SECTION 7.02. Proof of Execution of Instruments and of Holding of Securities Subject to
the provisions of Sections 6.01, 6.02 and 8.05, proof of the execution of any instrument by a
Securityholder or his agent or proxy shall be sufficient if made in accordance with such reasonable
rules and regulations as may be prescribed by the Trustee or in such manner as shall be
satisfactory to the Trustee.

The ownership of Securities shall be proved by the register of such Securities, or by a
certificate of the registrar thereof.

The Trustee may accept such other proof or require such additional proof of any matter
referred to in this Section 7.02 as it shall deem reasonable, including electronic or other
messages transmitted by the Depositary in accordance with its applicable procedures.

The record of any Securityholders’ meeting shall be proved in the manner provided in Section
8.06.

SECTION 7.03. Who May be Deemed Owners of Securities. The Company, the Trustee, any Paying
Agent and any Security registrar may deem and treat the person in whose name any Security shall be
registered upon the books of the Company for such series on the applicable record date as the
absolute owner of such Security (whether or not such Security shall be overdue and notwithstanding
any notation of ownership or other writing thereon) for the purpose of receiving payment of or on
account of the principal of, premium, if any, and interest on such Security and for all other
purposes; and neither the Company nor the Trustee nor any Paying Agent nor any Security registrar
shall be affected by any notice to the contrary. All such payments so made to, or upon the order
of, any such holder shall be valid, and, to the extent of the sum or sums so paid, effectual to
satisfy and discharge the liability for moneys payable upon any such Security.

SECTION 7.04. Securities Owned by Company or Controlled or Controlling Persons Disregarded for
Certain Purposes. In determining whether the holders of the requisite aggregate principal
amount of Securities have concurred in any demand, direction, request, notice, consent, waiver or
other action under this Indenture, Securities that are owned by the Company or any other obligor on
the Securities or by any person directly or indirectly controlling or controlled by or under direct
or indirect common control with the Company or any other obligor on the Securities shall be
disregarded and deemed not to be outstanding for the purpose of any such determination, provided
that for the purposes of determining whether the Trustee shall be protected in relying on any such
demand, direction, request, notice, consent or waiver, only Securities that the Trustee knows are
so owned shall be so disregarded. Securities so owned that have been pledged in good faith may be
regarded as outstanding for the purposes of this Section 7.04, if the pledgee shall establish to
the satisfaction of the Trustee the pledgee’s right to vote such Securities and that the pledgee is
not a person directly or indirectly controlling or controlled by or under direct or indirect common
control with the Company or any such obligor. In case of a dispute as to such right, any decision
by the Trustee taken upon the advice of counsel shall be full protection to the Trustee.

SECTION 7.05. Record Date for Action by Securityholders. Whenever in this Indenture it is
provided that holders of a specified percentage in aggregate principal amount of the Securities of
a series may take any action (including the making of any demand or request, the giving of any
direction, notice, consent or waiver or the taking of any action), other than any action taken at a
meeting of Securityholders called pursuant to Article Eight, the Company, pursuant to a resolution
of its Board of Directors, or the holders of at least ten percent in aggregate principal amount of
the Securities of such series then outstanding, may request the Trustee to fix a record date for
determining Securityholders entitled to notice of and to take any such action. In case the Company
or the holders of Securities of such series in the amount above specified shall desire to request
Securityholders of such series to take any such action and shall request the Trustee to fix a
record date with respect thereto by written notice setting forth in reasonable detail the
Securityholder action to be requested, the Trustee shall promptly (but in any event within five
days of receipt of such request) fix a record date that shall be a Business Day not less than 15
nor more than 20 days after the date on which the Trustee receives such request. If the Trustee
shall fail to fix a record date as hereinabove provided, then the Company or the holders of
Securities of such series in the amount above specified may fix the same by mailing written notice
thereof (the record date so fixed to be a Business Day not less than 15 nor more than 20 days after
the date on which such written notice shall be given) to the Trustee. If a record date is fixed
according to this Section 7.05, only persons shown as Securityholders of such series on the
registration books for the Company at the close of business on the record date so fixed shall be
entitled to take the requested action and the taking of any such action by the holders on the
record date of the required percentage of the aggregate principal amount of the Securities of such
series shall be binding on all Securityholders of such series, provided that the taking of the
requested action by the holders on the record date of the percentage in aggregate principal amount
of the Securities of such series in connection with such action shall have been evidenced to the
Trustee, as provided in Section 7.01, not later than 180 days after such record date.

SECTION 7.06. Instruments Executed by Securityholders Bind Future Holders. At any time
prior to (but not after) the evidencing to the Trustee, as provided in Section 7.01, of the taking
of any action by the holders of the percentage in aggregate principal amount of the Securities of
any or all series in connection with such action, any holder of a Security of such series the
serial number of which is shown by the evidence to be included in the Securities of such series the
holders of which have consented to such action may, by filing written notice with the Trustee at
its principal office and upon proof of holding as provided in Section 7.02, revoke such action so
far as concerns such Security. Except as aforesaid any such action taken by the holder of any
Security of such series and any direction, demand, request, waiver, consent, vote or other action
of the holder of any Security of such series that by any provisions of this Indenture is required
or permitted to be given shall be conclusive and binding upon such holder and upon all future
holders and owners of such Security, and of any Security issued in lieu thereof, irrespective of
whether or not any notation in regard thereto is made upon such Security. Any action taken by the
holders of the percentage in aggregate principal amount of the Securities of such series in
connection with such action shall be conclusively binding as the act of such holders upon the
Company, the Trustee and the holders of the Securities of such series.

ARTICLE EIGHT

SECURITYHOLDERS’ MEETINGS

SECTION 8.01. Purposes for Which Meetings May be Called. A meeting of holders of
Securities of any or all series, as the case may be, may be called at any time and from time to
time pursuant to the provisions of this Article Eight for any of the following purposes:

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

(2) to remove the Trustee and appoint a successor Trustee pursuant to the
provisions of Article Six;

(3) to consent to the execution of an indenture or indentures supplemental
hereto pursuant to the provisions of Section 9.02; or

(4) to take any other action authorized to be taken by or on behalf of the
holders of the percentage in aggregate principal amount of the Securities of any or
all series under any other provisions of this Indenture or under applicable law.

SECTION 8.02. Manner of Calling Meetings; Record Date. The Trustee may at any time call a
meeting of Securityholders of any or all series to take any action specified in Section 8.01, to be
held at such time and at such place in the City of Dallas, Texas, as the Trustee shall determine.
Notice of every meeting of the Securityholders of any or all series, setting forth the time and the
place of such meeting and in general terms the action proposed to be taken at such meeting, shall
be mailed nor less than thirty nor more than sixty days prior to the date fixed for the meeting to
such Securityholders at their registered addresses. For the purpose of determining Securityholders
entitled to notice of any meeting of Securityholders, the Trustee shall fix in advance a date as
the record date for such determination, such date to be a Business Day not more than ten days prior
to the date of the mailing of such notice as hereinabove provided. Only persons in whose name any
Security shall be registered upon the books of the Company on a Record Date fixed by the Trustee as
aforesaid, or by the Company or the Securityholders as in Section 8.03 provided, shall be entitled
to notice of the meeting of Securityholders with respect to which such record date was so fixed.

SECTION 8.03. Call of Meeting by Company or Securityholders. In case at any time the
Company, pursuant to a resolution of its Board of Directors, or the holders of at least ten percent
in aggregate principal amount of the Securities then outstanding of any or all series, as the case
may be, shall have requested the Trustee to call a meeting of such Securityholders to take any
action authorized in Section 8.01 by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not have mailed notice of such meeting
within twenty days after receipt of such request, then the Company or the holders of such
Securities in the amount above specified, as the case may be, may fix the record date with respect
to, and determine the time and the place in said City of Dallas, Texas for, such meeting and may
call such meeting to take any action authorized in Section 8.01, by mailing notice thereof as
provided in Section 8.02. The record date fixed as provided in the preceding sentence shall be set
forth in a written notice to the Trustee and shall be a Business Day not less than 15 nor more than
20 days after the date on which such notice is sent to the Trustee.

SECTION 8.04. Who May Attend and Vote at Meetings. To be entitled to vote at any meeting
of Securityholders a person shall be (i) a holder of one or more Securities of the series with
respect to which the meeting is called or, should the meeting be called with respect to the
Securities of all series, a holder of one or more of such series, or (ii) a person appointed by an
instrument in writing as proxy by a holder of one or more Securities of the series. The only
persons who shall be entitled to be present or to speak at any meeting of Securityholders shall be
the persons entitled to vote at such meeting and their counsel and any representatives of the
Trustee and its counsel and any representatives of the Company and its counsel. When a
determination of Securityholders entitled to vote at any meeting of Securityholders has been made
as provided in this Section 8.04, such determination shall apply to any adjournment thereof.

SECTION 8.05. Regulations. Notwithstanding any other provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any meeting of
Securityholders, in regard to proof of the holding of Securities of the series with respect to
which the meeting is called and of the appointment of proxies, and in regard to the appointment and
duties of inspectors of votes, the submission and examination of proxies, certificates and other
evidence of the right to vote, and such other matters concerning the conduct of the meeting as it
shall think fit. Except as otherwise permitted or required by any such regulations, the holding of
such Securities and the appointment of any proxy shall be proved in the manner specified in Section
7.02.

The Trustee shall, by an instrument in writing, appoint a temporary chairman of the meeting,
unless the meeting shall have been called by the Company or by Securityholders as provided in
Section 8.03, in which case the Company or the Securityholders calling the meeting, as the case may
be, shall in like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by a vote of the holders of a majority in principal
amount of the Securities represented at the meeting and entitled to vote.

Subject to the provisions of Section 7.04, at any meeting each Securityholder or proxy
entitled to vote thereat shall be entitled to one vote for each $1,000 principal amount of
Securities held or represented by him; provided, however, that no vote shall be cast or counted at
any meeting in respect of any Security challenged as not outstanding and ruled by the chairman of
the meeting to be not outstanding. The chairman of the meeting shall have no right to vote other
than by virtue of Securities held by him or instruments in writing as aforesaid duly designating
him as the person to vote on behalf of other Securityholders. Any meeting of Securityholders duly
called pursuant to the provisions of Section 8.02 or 8.03 may be adjourned from time to time, and
the meeting may be held as so adjourned without further notice.

At any meeting of Securityholders, the presence of persons who held, or who are acting as
proxy for persons who held, an aggregate principal amount of Securities of the series with respect
to which the meeting is called on the record date for such meeting sufficient to take action on the
business for the transaction of which such meeting was called shall constitute a quorum, but, if
less than a quorum is present, the persons holding or representing a majority in aggregate
principal amount of the Securities of the series with respect to which the meeting is called
represented at the meeting may adjourn such meeting with the same effect, for all intents and
purposes, as though a quorum had been present.

SECTION 8.06. Manner of Voting at Meetings and Record to be Kept. The vote upon any
resolution submitted to any meeting of Securityholders shall be by written ballots on each of which
shall be subscribed the signature of the Securityholder or proxy casting such ballot and the
identifying number or numbers of the Securities held or represented in respect of which such ballot
is cast. 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 duplicate of all votes cast at the
meeting. A record in duplicate of the proceedings of each meeting of Securityholders shall be
prepared by the secretary of the meeting and there shall be attached to said record the original
reports of the inspectors of votes on any vote by ballot taken thereat and affidavits by one or
more persons having knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was mailed as provided in Section 8.02. The record shall show the
identifying numbers of the Securities voting in favor of or against any resolution. Each
counterpart of such record shall be signed and verified by the affidavits of the permanent chairman
and secretary of the meeting and one of the counterparts shall be delivered to the Company and the
other to the Trustee to be preserved by the Trustee.

Any counterpart record so signed and verified shall be conclusive evidence of the matters
therein stated and shall be the record referred to in clause (b) of Section 7.01.

SECTION 8.07. Exercise of Rights of Trustee and Securityholders Not to be Hindered or
Delayed. Nothing in this Article Eight contained shall be deemed or construed to authorize or
permit, by reason of any call of a meeting of Securityholders or any rights expressly or impliedly
conferred hereunder to make such call, any hindrance or delay in the exercise of any right or
rights conferred upon or reserved to the Trustee or to the Securityholders under any of the
provisions of this Indenture or of the Securities of any or all series.

SECTION 8.08. Written Consent in Lieu of Meeting of Securityholders. The written
authorization or consent of the requisite percentage of Securityholders herein provided, entitled
to vote at any such meeting, evidenced as provided in Article Seven and filed with the Trustee,
shall be effective in lieu of a meeting of Securityholders, with respect to any matter provided for
in this Article Eight.

ARTICLE NINE

SUPPLEMENTAL INDENTURES

SECTION 9.01. Purposes for Which Supplemental Indentures May be Entered into Without Consent of
Securityholders. The Company, when authorized by a resolution of its Board of Directors, and
the Trustee may from time to time and at any time enter into an indenture or indentures
supplemental hereto (which shall comply with the provisions of the Trust Indenture Act of 1939 as
then in effect) for one or more of the following purposes:

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

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

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

(d) to provide for the issuance under this Indenture of Securities, whether or not then
outstanding, in coupon form (including Securities registrable as to principal only) and to provide
for exchangeability of such Securities with Securities issued hereunder in fully registered form
and to make all appropriate changes for such purpose;

(e) to establish the form or terms and to provide for the issuance of Securities of any series
as permitted by Sections 2.01 and 2.03; and

(f) to evidence and provide for the acceptance of appointment hereunder by a successor trustee
with respect to the Securities of one or more series and to add to or change any of the provisions
of this Indenture as shall be necessary to provide for or facilitate the administration of the
trusts hereunder by more than one trustee.

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

Any supplemental indenture authorized by the provisions of this Section 9.01 may be executed
by the Company and the Trustee without the consent of the holders of any of the Securities at the
time outstanding, notwithstanding any of the provisions of Section 9.02.

SECTION 9.02. Modification of Indenture with Consent of Holders of 66?% in Principal Amount of
Securities. With the consent (evidenced as provided in Section 7.01) of the holders of not
less than 66?% in aggregate principal amount of the Securities at the time outstanding of all
Securities affected by such supplement (voting as one class) (determined as provided in Section
7.04), or, if a record date is set with respect to such consent in accordance with Section 7.05, as
of such record date, the Company, when authorized by a resolution of its Board of Directors, and
the Trustee may from time to time and at any time enter into an indenture or indentures
supplemental hereto (which shall comply with the provisions of the Trust Indenture Act of 1939 as
then in effect) for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of any supplemental indenture or of
modifying in any manner the rights of the holders of the Securities of each such series; provided,
however, that no such supplemental indenture shall (i) extend the stated maturity of any Security,
or reduce the rate or extend the time of payment of interest thereon or reduce any amount payable
on redemption thereof or reduce the amount of the principal of an Original Issue Discount Security
that would be due and payable upon an acceleration of the maturity thereto pursuant to Section
5.01, or impair or affect the right of any Securityholder to institute suit for the payment thereof
or the right of repayment if any, at the option of the Securityholder, without the consent of the
holder of each Security so affected or (ii) reduce the aforesaid percentage of Securities of any
series or of all series (voting as one class), as the case may be, the consent of the holders of
which is required for any such supplemental indenture, without the consent of the holders of all
Securities of each such series so affected.

A supplemental indenture that changes or eliminates any covenant or other provision of this
Indenture that has expressly been included solely for the benefit of one or more particular series
of Securities, or that modified the rights of holders of such series with respect to such covenant
or provision, shall be deemed not to affect the rights under this Indenture of the holders of any
other series.

Upon the request of the Company, accompanied by a copy of a resolution of its Board of
Directors certified by the Secretary or an Assistant Secretary of the Company authorizing the
execution of any such supplemental indenture, and upon the filing with the Trustee of evidence of
the consent of Securityholders as aforesaid, the Trustee shall join with the Company in the
execution of such supplemental indenture, provided that if such supplemental indenture affects the
Trustee’s own rights, duties or immunities under this Indenture or otherwise, the Trustee may in
its discretion, but shall not be obligated to, enter into such supplemental indenture.

It shall not be necessary for the consent of the Securityholders under this Section 9.02 to
approve the particular form of any proposed supplemental indenture, but it shall be sufficient if
such consent shall approve the substance thereof.

Promptly after the execution by the Company and the Trustee of any supplemental indenture
pursuant to the provisions of this Section 9.02, the Company shall mail a notice to the
Securityholders of each series affected thereby, setting forth in general terms the substance of
such supplemental indenture. Any failure of the Company to mail such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any such supplemental
indenture.

SECTION 9.03. Effect of Supplemental Indentures. Upon the execution of any supplemental
indenture pursuant to the provisions of this Article Nine, this Indenture shall be and be deemed to
be modified and amended in accordance therewith and the respective rights, limitation of rights,
obligations, duties and immunities under this Indenture of the Trustee, the Company and the holders
of Securities of each series affected thereby shall thereafter be determined, exercised and
enforced hereunder subject in all respects to such modifications and amendments, and all the terms
and conditions of any such supplemental indenture shall be and be deemed to be part of the terms
and conditions of this Indenture for any and all purposes.

SECTION 9.04. Securities May Bear Notation of Changes by Supplemental Indentures.
Securities of any series authenticated and delivered after the execution of any supplemental
indenture affecting such series pursuant to the provisions of this Article Nine, or after any
action taken at a Securityholders’ meeting pursuant to Article Eight, may bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental indenture or as to any
action taken at any such meeting. If the Company or the Trustee shall so determine, new Securities
of any series so modified as to conform, in the opinion of the Trustee and the Board of Directors
of the Company, to any modification of this Indenture contained in any such supplemental indenture
may be prepared by the Company, authenticated by the Trustee and delivered in exchange for the
Securities of such series then outstanding.

SECTION 9.05. Opinion of Counsel. The Trustee, subject to the provisions of Sections 6.01
and 6.02, may rely upon, and shall be entitled to receive, an Opinion of Counsel as conclusive
evidence that any such supplemental indenture complies with the provisions of this Article Nine.

ARTICLE TEN

CONSOLIDATION, MERGER AND SALE

SECTION 10.01. Company May Consolidate, etc., on Certain Terms. Nothing contained in this
Indenture or in any of the Securities shall prevent any consolidation or merger of the Company with
or into any other corporation or corporations (whether or not affiliated with the Company) or
successive consolidations or mergers in which the Company or its successor or successors shall be a
party or parties, or shall prevent any sale or conveyance of the property of the Company as an
entirety, or substantially as an entirety, to any other corporation (whether or not affiliated with
the Company) authorized to acquire and operate the same; provided, however, and the Company hereby
covenants and agrees, that any such consolidation, merger, sale or conveyance shall be upon the
condition that (a) immediately after such consolidation, merger, sale or conveyance no Event of
Default, and no event that upon notice or lapse of time, or both, would become an Event of Default,
shall have occurred and be continuing with respect to the corporation (whether the Company or such
other corporation) formed by or surviving any such consolidation or merger, or to which such sale
or conveyance shall have been made; (b) the corporation (if other than the Company) formed by or
surviving any such consolidation or merger, or to which such sale or conveyance shall have been
made, shall be a corporation organized under the laws of the United States of America or any State
thereof; and (c) the due and punctual payment of the principal of, premium, if any, and interest on
all of the Securities, according to their tenor, and the due and punctual performance and
observance of all the covenants and conditions of this Indenture to be performed or observed by the
Company, shall be expressly assumed, by supplemental indenture complying with the requirements of
Article Nine, satisfactory in form to the Trustee, executed and delivered to the Trustee by the
corporation formed by such consolidation, or into which the Company shall have been merged, or by
the corporation that shall have acquired such property. If at any time there shall be any
consolidation or merger or sale or conveyance of property to which the covenant of this Section
10.01 is applicable, then in any such event the successor corporation will promptly deliver to the
Trustee:

(1) an Officers’ Certificate stating that as of the time immediately after the
effective date of any such transaction the covenants of the Company and conditions
contained in this Section 10.01 have been complied with and the successor
corporation is not in default under the provisions of this Indenture; and

(2) an Opinion of Counsel stating that in the opinion of such counsel such
covenants have been complied with and that any instrument or instruments executed in
the performance of such covenants comply with the requirements thereof.

SECTION 10.02. Successor Corporation to be Substituted. In case of any such consolidation,
merger, sale or conveyance and upon the assumption by the successor corporation, in the manner
hereinabove provided, of the due and punctual payment of the principal or premium, if any, and
interest on all of the Securities and the due and punctual performance and observance of all of the
covenants and conditions of this Indenture to be performed or observed by the Company, such
successor corporation shall succeed to and be substituted for the Company, with the same effect as
if it had been named herein as the party of the first part. Such successor corporation thereupon
may cause to be signed, and may issue either in its own name or in the name of Southwest Airlines
Co., any or all of the Securities issuable hereunder that theretofore shall not have been signed by
the Company and delivered to the Trustee; and, upon the order of such successor corporation
(instead of the Company) and subject to all the terms, conditions and limitations in this Indenture
prescribed, the Trustee shall authenticate and shall deliver any Securities that previously shall
have been signed and delivered by the officers of the Company to the Trustee of authentication, and
any Securities that such successor corporation thereafter shall cause to be signed and delivered to
the Trustee for that purpose. All the Securities so issued shall in all respects have the same
legal rank and benefit under this Indenture as the Securities theretofore or thereafter issued in
accordance with the terms of this Indenture as though all of such Securities had been issued at the
date of the execution hereof. In the event of any such sale or conveyance and upon any such
assumption, the Company or any successor corporation that shall theretofore have become such in the
manner described in this Article Ten shall be discharged from all obligations and covenants under
this Indenture and the Securities so assumed and may be liquidated and dissolved.

In case of any such consolidation, merger, sale or conveyance such changes in phraseology and
form (but not in substance) may be made in the Securities thereafter to be issued as may be
appropriate.

ARTICLE ELEVEN

SATISFACTION AND DISCHARGE OF INDENTURE;

UNCLAIMED MONEYS

SECTION 11.01. Satisfaction and Discharge of Indenture. If at any time (a) the Company
shall have paid or caused to be paid the principal of and interest on all the Securities of each
series outstanding hereunder, as and when the same shall have become due and payable, or (b) the
Company shall have delivered to the Trustee for cancellation (i) all securities of any series
theretofore authenticated (other than any Securities of any series that shall have been destroyed,
lost or stolen and that shall have been replaced or paid as provided in Section 2.08) and (ii)
Securities for whose payment moneys have theretofore been deposited in trust and segregated and
held in trust by the Company and thereafter returned to the Company or discharged from such trust,
as provided in Section 11.04 or (c)(i) all such Securities not theretofore delivered to the Trustee
for cancellation shall have become due and payable, or are by their terms to become due and payable
within one year or are to be called for redemption under arrangements satisfactory to the Trustee
for the giving of notice of redemption, and (ii) the Company shall have irrevocably deposited or
caused to be deposited with the Trustee as trust funds an amount (other than moneys returned by the
Trustee or any Paying Agent to the Company in accordance with Section 11.04) sufficient to pay at
maturity or upon redemption all such Securities not theretofore delivered to the Trustee for
cancellation, including principal and interest due or to become due to such date of maturity or
date of redemption, as the case may be, and if, in any such case, the Company shall also pay or
cause to be paid all other sums payable hereunder by the Company with respect to Securities of such
series, then this Indenture shall cease to be of further effect with respect to Securities of such
series (except as to (i) rights of registration of transfer and exchange, (ii) substitution of
apparently mutilated, defaced, destroyed, lost or stolen Securities, (iii) the rights, obligations
and immunities of the Trustee hereunder and (iv) the rights of the Securityholders of such series
as beneficiaries hereof with respect to the property so deposited with the Trustee payable to all
or any of them), and the Trustee, on demand of the Company accompanied by an Officers’ Certificate
and an Opinion of Counsel (each stating that all conditions precedent herein provided for relating
to the satisfaction and discharge of this Indenture have been complied with) and at the cost and
expense of the Company, shall execute proper instruments acknowledging such satisfaction of and
discharging this Indenture with respect to such series; provided that the rights of holders of the
Securities of such series to receive amounts in respect of principal of and interest on the
Securities held by them shall not be delayed longer than required by then-applicable mandatory
rules or polices of any securities exchange upon which the Securities of such series are listed and
provided further that the Company shall not be discharged from any payment obligations in respect
of any Securities, and such obligations shall be reinstated, if the Trustee is unable to apply any
money in accordance with this Section by reason of any legal proceeding or any order or judgment of
any court or governmental authority enjoining, restraining or otherwise prohibiting such
application until such time as the Trustee is able to apply such money or the obligations are
otherwise satisfied. The Company agrees to reimburse the Trustee of any costs or expenses
thereafter reasonably and properly incurred and to compensate the Trustee for any services
thereafter reasonably and properly rendered by the Trustee in connection with this Indenture or the
Securities of such series.

SECTION 11.02. Application by Trustee of Funds Deposited for Payment of Securities.
Subject to Section 11.04, all moneys deposited with the Trustee pursuant to Section 11.01 shall be
held in trust and applied by it to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent), to the holders of the particular Securities
of such series, for the payment or redemption of which such moneys have been deposited with the
Trustee, of all sums due and to become due thereon for principal, interest and premium, if any.

SECTION 11.03. Repayment of Moneys Held by Paying Agent. In connection with the
satisfaction and discharge of this Indenture with respect to such series of Securities, all moneys
then held by any Paying Agent under the provisions of this Indenture with respect to any such
series of Securities shall, upon demand of the Company or the Trustee, be paid to the Trustee and
thereupon such Paying Agent shall be released from all further liability with respect to such
moneys.

SECTION 11.04. Repayment of Moneys Held by Trustee. Unless otherwise required by mandatory
provisions of escheat or abandoned or unclaimed property laws, any moneys deposited with the
Trustee or any Paying Agent, or then held by the Company, for the payment of the principal of,
premium, if any, or interest on any Securities of any series and not applied but remaining
unclaimed by the holders of Securities for two years after the date upon which such payment shall
have become due, shall be repaid to the Company by the Trustee or by such Paying Agent on demand;
or, if then held by the Company, shall be discharged from such trust; and thereupon the Trustee and
such Paying Agent or the Company as trustee shall be released from all further liability with
respect to such moneys, and the holder of any of the Securities of such series entitled to receive
such payment shall, unless otherwise required by mandatory provisions of applicable escheat or
abandoned or unclaimed property laws, thereafter look only to the Company for the payment thereof;
provided however, that the Trustee or Paying Agent, before being required to make any such payment,
may at the expense of the Company cause to be published once, in a newspaper published in the
English language, customarily published on each Business Day and of general circulation in New York
City, or cause to be mailed to each Securityholder of such series, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than 30 days from the
date of such publication, any unclaimed balance of such money then remaining will be repaid to the
Company.

SECTION 11.05. Satisfaction, Discharge and Defeasance of Securities of any Series. If this
Section 11.05 is specified, as contemplated by Section 2.03, to be applicable to Securities of any
series, the Company shall be deemed to have paid and discharged the entire indebtedness on all the
Securities of any such series at the time outstanding, and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging satisfaction, discharge and defeasance of
such indebtedness, when

(1) either

(A) with respect to all Securities of such series at the time
outstanding,

(i) the Company has deposited or caused to be deposited with the
Trustee as trust funds in trust for the purpose an amount sufficient
to pay and discharge the entire indebtedness on all such Securities
for principal, premium, if any, and interest, on the days on which
such principal, premium, if any, or interest, as the case may be, is
due and payable in accordance with the terms of this Indenture and
such Securities, to the date of maturity or date of redemption
thereof as contemplated by the penultimate paragraph of this Section
11.05, as the case may be; or

(ii) the Company has deposited or caused to be deposited with
the Trustee as obligations in trust for the purpose such amount of
non-callable direct obligations of, or obligations the principal of
and interest on which are fully guaranteed by, the United States of
America as will, together with the income to accrue thereon without
consideration of any reinvestment thereof, be sufficient to pay and
discharge the entire indebtedness on all such Securities for
principal, premium, if any, and interest, on the days on which such
principal, premium, if any, or interest, as the case may be, is due
and payable in accordance with the terms of this Indenture and such
Securities, to the date of maturity or date of redemption thereof as
contemplated by the penultimate paragraph of this Section 11.05, as
the case may be; or

(B) the Company has properly fulfilled such other means of satisfaction
and discharge as is specified, as contemplated by Section 2.03, to be
applicable to the Securities of such series;

(2) the Company has paid or caused to be paid all other sums payable with
respect to the Securities of such series at the time outstanding and all other
amounts due under this Indenture with respect to such series;

(3) such deposit will not result in a breach or violation of, or constitute a
default under, this Indenture or any other agreement or instrument to which the
Company is a party or by which it is bound;

(4) no Event of Default or event that, after notice or lapse of time or both,
would become an Event of Default shall have occurred and be continuing on the date
of such deposit;

(5) the Company has delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel to the effect that (i) the Company has received from, or that
there has been published by, the Internal Revenue Service a ruling, or (ii) since
the date of this Indenture there has been a change in applicable federal income tax
law, in either case to the effect that holders of the Securities of such series will
not recognize income, gain or loss for federal income tax purposes as a result of
such deposit, satisfaction, discharge and defeasance and will be subject to federal
income tax on the same amounts and in the same manner and at the same times, as
would have been the case if such deposit, satisfaction, discharge and defeasance had
not occurred; and

(6) the Company has delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel, each stating that all conditions precedent herein provided for
relating to the satisfaction, discharge and defeasance of the entire indebtedness on
all Securities of any such series at the time outstanding have been complied with.

Any deposits with the Trustee referred to in Section 11.05(1)(A) above shall be irrevocable
and shall be made under the terms of an escrow trust agreement in form and substance satisfactory
to the Trustee. If any Securities of such series at the time outstanding are to be redeemed prior
to their stated maturity, whether pursuant to any optional redemption provisions or in accordance
with any mandatory sinking fund requirement, the Company shall make such arrangements as are
satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and
at the expense, of the Company.

Upon the satisfaction of the conditions set forth in this Section 11.05 with respect to all
the Securities of any series at the time outstanding, the terms and conditions of such series,
including the terms and conditions with respect thereto set forth in this Indenture, shall no
longer be binding upon, or applicable to, the Company, provided that the Company shall not be
discharged from any payment obligations in respect of Securities of such series that are deemed not
to be outstanding under clause (c) of the definition thereof if such obligations continue to be
valid obligations in accordance with this Section by reason of any legal proceeding or any order or
judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting
such application.

ARTICLE TWELVE

IMMUNITY OF INCORPORATORS, SHAREHOLDERS, OFFICERS

AND DIRECTORS

SECTION 12.01. Incorporators, Shareholders, Officers and Directors Exempt from Individual
Liability. No recourse under or upon any obligation, covenant or agreement of this Indenture,
or of any Security, or for any claim based thereon or otherwise in respect thereof shall be had
against any incorporator, shareholder, officer or director, as such, past, present or future, of
the Company or of any successor corporation, either directly or through the Company or such
successor corporation, whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being expressly understood that this
Indenture and the obligations issued hereunder are solely corporate obligations, and that no such
personal liability whatever shall attach to, or is or shall be incurred by, the incorporators,
shareholders, officers or directors, as such, past, present or future, of the Company or of any
successor corporation, or any of them, because of the reason of the indebtedness hereby authorized,
or under or by reason of the obligations, covenants or agreements contained in this Indenture or in
any of the Securities or implied therefrom; and that any and all such personal liability of every
name and nature, either at common law or in equity or by constitution or statute, of and any and
all such rights and claims against, every such incorporator, shareholder, officer or director, as
such, because of the creation of the indebtedness hereby authorized, or under or by reason of the
obligations, covenants or agreements contained in this Indenture or in any of the Securities or
implied therefrom are hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Indenture and the issue of such Securities.

ARTICLE THIRTEEN

MISCELLANEOUS PROVISIONS

SECTION 13.01. Successors and Assigns of Company Bound by Indenture. All the covenants,
stipulations, promises and agreements in this Indenture contained by or on behalf of the Company
shall bind its successors and assigns, whether so expressed or not.

SECTION 13.02. Acts of Board, Committee or Officer of Successor Entity Valid. Any act or
proceeding by any provision of this Indenture authorized or required to be done or performed by any
board, committee or officer of the Company shall and may be done and performed with like force and
effect by the like board, committee or officer of any corporation that shall at the time be the
lawful sole successor of the Company.

SECTION 13.03. Required Notices or Demands May be Served by Mail; Waiver. Any notice,
direction, request or demand that by any provisions of this Indenture is required or permitted to
be given or served by the Trustee or by the holders of Securities to or on the Company shall be in
the English language and may be given or served by being deposited, postage prepaid, certified or
registered mail, addressed (until another address is filed by the Company with the Trustee for such
purpose), as follows: Southwest Airlines Co., P.O. Box 36611, Dallas, Texas 75235, Attention:
Treasurer. Any notice, direction, request or demand by any Securityholder to or upon the Trustee
shall be deemed to have been sufficiently given or made, for all purposes, if given or made at the
principal office of the Trustee.

Where this Indenture provides for notice to Securityholders, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if in writing in the English language and
mailed, first class, postage prepaid, to each holder entitled thereto, at his last address as it
appears in the Security register or registers. In any case where notice to holders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any
particular holder shall affect the sufficiency of such notice with respect to other holders.

In case, by reason of the suspension of or irregularities in regular mail service, it shall be
impracticable to mail notice to the Company or Securityholders when such notice is required to be
given pursuant to any provision of this Indenture, then any manner of giving such notice as shall
be satisfactory to the Trustee shall be deemed to be a sufficient giving of such notice.

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 or action relating
thereto, and such waiver shall be the equivalent of such notice. Waivers of notice by
Securityholders shall be filed with the Trustee, but such filing shall not be a condition precedent
to the validity of any action taken in reliance upon such waiver.

SECTION 13.04. Indenture and Securities to be Construed in Accordance with the Laws of the
State of Texas. This Indenture and each Security shall be deemed to be a contract made under
the laws of the State of Texas, and for all purposes shall be construed in accordance with the laws
of said State, except as otherwise required by mandatory provisions of law.

SECTION 13.05. Evidence of Compliance with Conditions Precedent. Upon any request or
application by the Company to the Trustee to take any action under any of the provisions as of this
Indenture, the Company shall furnish to the Trustee an Officers’ Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the proposed action have
been complied with, and an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent have been complied with, except that in the case of any such application or
demand as to which the furnishing of such documents is specifically required by any provision of
this Indenture relating to such particular application or demand, no additional certificate or
opinion need be furnished.

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

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

Any certificate, statement or opinion of an officer of the Company 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 unless such officer or counsel, as the case may be, knows that
the certificate or opinion or representations with respect to the accounting matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous. Any certificate or opinion of any
independent firm of public accountants filed with the Trustee shall contain a statement that such
firm is independent.

SECTION 13.06. Payments Due on Saturdays, Sundays, and Holidays. In any case where the
date of payment of interest on or principal of the Securities of any series, or the date fixed for
redemption or repayment of any such Security, shall not be a Business Day, then payment of interest
or principal (and premium, if any) need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date of payment or the
date fixed for redemption, and no interest shall accrue for the period after such date.

SECTION 13.07. Provisions Required by Trust Indenture Act of 1939 to Control. If and to
the extent that any provision of this Indenture limits, qualifies or conflicts with the duties
imposed by operation of subsection (c) of Section 318 of the Trust Indenture Act of 1939, the
imposed duties shall control.

SECTION 13.08. Provisions of this Indenture and Security for the Sole Benefit of the Parties
and the Securityholders. Nothing in this Indenture or in the Securities, expressed or implied,
shall give or be construed to give any person, firm or corporation, other than the parties hereto
and their successors and the holders of the Securities, any legal or equitable right, remedy or
claim under or in respect of this Indenture, or under any covenant, condition or provision herein
contained; all its covenants, conditions and provisions being for the sole benefit of the parties
hereto and their successors and the holders of the Securities.

SECTION 13.09. Indenture May be Executed in Counterparts. This Indenture may be executed
in any number of counterparts, each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.

SECTION 13.10. Article and Section Headings. The Article and Section heading references
herein and in the Table of Contents are for convenience only and shall not affect the construction
hereof.

SECTION 13.11. Severability. If any provision hereof shall be held to be invalid, illegal
or unenforceable under applicable law, then the remaining provisions hereof shall be construed as
though such invalid, illegal or unenforceable provision were not contained herein.

ARTICLE FOURTEEN

REDEMPTION OF SECURITIES AND SINKING FUNDS

SECTION 14.01. Applicability of Article. The provisions of this Article shall be
applicable to the Securities of any series that are redeemable before their maturity or to any
sinking fund for the retirement of Securities of a series, in either case as specified as
contemplated by Section 2.03 for Securities of such series.

SECTION 14.02. Notice of Redemption; Partial Redemptions. Notice of redemption to the
holders of Securities of any series to be redeemed as a whole or in part shall be given by mailing
notice of such redemption by first class mail, postage prepaid, at least 20 days and not more than
60 days prior to the date fixed for redemption to such holders of Securities of such series at
their last addresses as they shall appear upon the Security register or registers. Any notice that
is mailed in the manner herein provided shall be conclusively presumed to have been duly given,
whether or not the holder receives the notice. Failure to give notice by mail, or any defect in
the notice to the holder of any Security of a series designated for redemption as a whole or in
part shall not affect the validity of the proceedings for the redemption of any other Security of
such series.

The notice of redemption to each such holder shall specify the principal amount of each
Security of such series held by such holder to be redeemed, the date fixed for redemption, the
redemption price (or the method of calculating the redemption price), the place or places of
payment, that payment will be made upon presentation and surrender of such Securities, that such
redemption is pursuant to the mandatory or optional sinking fund, or both, if such be the case,
that interest accrued to the date fixed for redemption will be paid as specified in said notice and
that on and after said date interest thereon or on the portions thereof to be redeemed will cease
to accrue. In case any Security of a series is to be redeemed in part only the notice of
redemption shall state the portion of the principal amount thereof to be redeemed and shall state
that on and after the date fixed for redemption, upon surrender of such Security, a new Security or
Securities of such series in principal amount equal to the unredeemed portion thereof will be
issued.

The notice of redemption of Securities of any series to be redeemed at the option of the
Company shall be given by the Company or, at the Company’s request, by the Trustee for such series
in the name and at the expense of the Company.

No later than 11:00 a.m., New York City time, on the redemption date specified in the notice
of redemption given as provided in this Section, the Company will deposit with the Trustee or with
one or more Paying Agents (or, if the Company is acting as its own Paying Agent, set aside,
segregate and hold in trust as provided in Section 3.04) an amount of money sufficient to redeem on
the redemption date all the Securities of such series so called for redemption at the appropriate
redemption price, together with accrued interest to the date fixed for redemption. If less than
all the outstanding Securities of a series are to be redeemed, the Company will deliver to the
Trustee at least 70 days (or such shorter period acceptable to the Trustee) prior to the date fixed
for redemption an Officers’ Certificate stating the aggregate principal amount of Securities to be
redeemed.

If less than all the Securities of a series are to be redeemed, the Trustee shall select, in
such manner as it shall deem appropriate and fair, Securities of such series to be redeemed in
whole or in part. Securities may be redeemed in part in multiples equal to the minimum authorized
denomination for Securities of such series or any integral multiple thereof. The Trustee shall
promptly notify the Company in writing of the Securities of such series selected for redemption
and, in the case of any Securities of such series selected for partial redemption, the principal
amount of each such Security to be redeemed. For all purposes of this Indenture, unless the
context otherwise requires, all provisions relating to the redemption of the Securities of any
series shall relate, in the case of any Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Security which has been or is to be redeemed.

SECTION 14.03. Payment of Securities Called for Redemption. If notice of redemption has
been given as above provided, the Securities or portions of Securities specified in such notice
shall become due and payable on the date and at the place or places stated in such notice at the
applicable redemption price, together with interest accrued to the date fixed for redemption, and
on and after said date (unless the Company shall default in the payment of such Securities at the
redemption price, together with interest accrued to said date) interest on the Securities or
portions of Securities so called for redemption shall cease to accrue and, except as provided in
Sections 6.05 and 11.04, such Securities shall cease from and after the date fixed for redemption
to be entitled to any benefit or security under this Indenture, and the holders thereof shall have
no right in respect of such Securities except the right to receive the redemption price thereof and
unpaid interest to the date fixed for redemption. On presentation and surrender of such Securities
at a place of payment specified in said notice, said Securities or the specified portions thereof
shall be paid and redeemed by the Company at the applicable redemption price, together with
interest accrued thereon to the date fixed for redemption; provided that any semiannual payment of
interest becoming due on the date fixed for redemption shall be payable to the holders of such
Securities registered as such on the relevant record date subject to the terms and provisions of
Section 2.03 hereof.

If any Security called for redemption shall not be so paid upon surrender thereof for
redemption, the principal shall, until paid or duly provided for, bear interest from the date fixed
for redemption at the rate of interest or Yield to Maturity (in the case of an Original Issue
Discount Security) borne by the Security.

Upon presentation of any Security redeemed in part only, the Company shall execute and the
Trustee shall authenticate and deliver to or on the order of the holder thereof, at the expense of
the Company, a new Security or Securities of such series, of authorized denominations, in principal
amount equal to the unredeemed portion of the Security so presented.

SECTION 14.04. Exclusion of Certain Securities from Eligibility for Selection for
Redemption. Securities shall be excluded from eligibility for selection for redemption if they
are identified by registration and certificate number in a written statement signed by an
authorized officer of the Company and delivered to the Trustee at least 10 (or such lesser number
as the Trustee may permit) days prior to the last date on which notice of redemption may be given
as being owned by, and not pledged or hypothecated by, either (i) the Company or (ii) an Affiliate
specifically identified in such written statement.

SECTION 14.05. Mandatory and Optional Sinking Funds. The minimum amount of any sinking fund
payment provided for by the terms of Securities of any series is herein referred to as a “mandatory
sinking fund payment,” and any payment in excess of such minimum amount provided for by the terms
of Securities of any series is herein referred to as an “optional sinking fund payment.” The last
date on which a sinking fund payment may be made in each year is herein referred to as the “sinking
fund payment date.”

In lieu of making all or any part of any mandatory sinking fund payment with respect to any
series of Securities in cash, the Company may at its option (i) deliver to the Trustee Securities
of such series theretofore purchased or otherwise acquired (except upon redemption pursuant to the
mandatory sinking fund) by the Company or receive credit for Securities of such series (not
previously so credited) theretofore purchased or otherwise acquired (except as aforesaid) by the
Company and delivered to the Trustee for cancellation pursuant to Section 2.09, (ii) receive credit
for optional sinking fund payments (not previously so credited) made pursuant to this Section, or
(iii) receive credit for Securities of such series (not previously so credited) redeemed by the
Company through any optional redemption provisions contained in the terms of such Securities.
Securities so delivered or credited shall be received or credited by the Trustee at the sinking
fund redemption price specified in such Securities.

On or before the sixtieth day (or such later day, no later than the twentieth, as the Trustee
may permit) next preceding each sinking fund payment date for any series, the Company will deliver
to the Trustee a written statement (which need not contain the statements required by Section
13.05) signed by an authorized officer of the Company (i) specifying the portion of the mandatory
sinking fund payment to be satisfied by payment of cash and the portion to be satisfied by credit
of Securities of such series, (ii) stating that none of the Securities of such series has
theretofore been so credited, (iii) stating that no defaults in the payment of interest or Events
of Default with respect to such series have occurred (which have not been waived or cured) and are
continuing and (iv) stating whether or not the Company intends to exercise its right to make an
optional sinking fund payment with respect to such series, and, if so, specifying the amount of
such optional sinking fund payment that the Company intends to pay on or before the next succeeding
sinking fund payment date. Any Securities of such series to be credited and required to be
delivered to the Trustee in order for the Company to be entitled to credit therefor as aforesaid
that have not theretofore been delivered to the Trustee shall be delivered for cancellation
pursuant to Section 2.09 to the Trustee with such written statement (or reasonably promptly
thereafter if acceptable to the Trustee). Such written statement shall be irrevocable and upon its
receipt by the Trustee the Company shall become unconditionally obligated to make all the cash
payments therein referred to, if any, on or before the next succeeding sinking fund payment date.
Failure of the Company, on or before any such sixtieth day (or such later day as the Trustee may
have permitted), to deliver such written statement and Securities specified in this paragraph, if
any, shall not constitute a default but shall constitute, on and as of such date, the irrevocable
election of the Company (i) that the mandatory sinking fund payment for such series due on the next
succeeding sinking fund payment date shall be paid entirely in cash without the option to deliver
or credit Securities of such series in respect thereof and (ii) that the Company will make no
optional sinking fund payment with respect to such series as provided in this Section.

If the sinking fund payment or payments (mandatory or optional or both) made in cash plus any
unused balance of any preceding sinking fund payments made in cash shall exceed $50,000 (or a
lesser sum if the Company shall so request) with respect to the Securities of any particular
series, such cash shall be applied on the next succeeding sinking fund payment date to the
redemption of Securities of such series at the sinking fund redemption price together with accrued
interest to the date fixed for redemption. If such amount shall be $50,000 or less and the Company
makes no such request then it shall be carried over until a sum in excess of $50,000 is available.
The Trustee shall select, in the manner provided in Section 14.02, for redemption on such sinking
fund payment date a sufficient principal amount of Securities of such series to absorb said cash,
as nearly as may be, and shall (if requested in writing by the Company) inform the Company or an
entity known by the Trustee to be an Affiliate, as shown by the Security register or registers, and
not known to the Trustee to have been pledged or hypothecated by the Company or any such entity or
(ii) identified in a written statement delivered to the Trustee pursuant to Section 14.04 as being
owned by, and not pledged or hypothecated by, the Company or an Affiliate shall be excluded from
Securities of such series eligible for selection for redemption. The Trustee, in the name and at
the expense of the Company (or the Company, if it shall so request the Trustee in writing) shall
cause notice of redemption of the Securities of such series to be given in substantially the manner
provided in Section 14.02 (and with the effect provided in Section 14.03) for the redemption of
Securities of such series in part at the option of the Company. The amount of any sinking fund
payments not so applied or allocated to the redemption of Securities of such series shall be added
to the next cash sinking fund payment and, together with such payment, shall be applied in
accordance with the provisions of this Section 14.05. Any and all sinking fund moneys held on the
stated maturity date of the Securities of any particular series (or earlier, if such maturity is
accelerated), that are not held for the payment or redemption of particular Securities of such
series shall be applied, together with other moneys if necessary, sufficient for the purpose, to
the payment of the principal of, and interest on, the Securities of such series at maturity.

The Trustee shall not redeem or cause to be redeemed any Securities of a series with sinking
fund moneys or mail any notice of redemption of Securities for such series by operation of the
sinking funds during the continuance of a default in payment of interest on such Securities or of
any Event of Default except that, where the mailing of notice of redemption of any Securities shall
theretofore have been made, the Trustee shall redeem or cause to be redeemed such Securities,
provided that it shall have received from the Company a sum sufficient for such redemption. Except
as aforesaid, any moneys in the sinking fund for such series at the time when any such default or
Event of Default shall occur, and any moneys thereafter paid into the sinking fund, shall, during
the continuance of such default or Event of Default, be deemed to have been collected under Article
Five and held for the payment of all such Securities. In case such Event of Default shall have
been waived as provided in Article Five or the default cured on or before the sixtieth day
preceding the sinking fund payment date in any year, such moneys shall thereafter be applied on the
next succeeding sinking fund payment date in accordance with this Section to the redemption of such
Securities.

3

THE BANK OF NEW YORK TRUST COMPANY, N.A., the party of the second part, hereby accepts the
trust in this Indenture declared and provided, upon the terms and conditions hereinabove set forth.

IN WITNESS WHEREOF, SOUTHWEST AIRLINES CO. the party of the first part, has caused this
Indenture to be signed by one of its Vice Presidents; and THE BANK OF NEW YORK TRUST COMPANY, N.A.,
the party of the second part, has caused this Indenture to be signed by one of its Vice Presidents,
all as of the day and year first written above.

SOUTHWEST AIRLINES CO.

By: /s/ Laura Wright

	 	 	 	Sr. Vice President — Finance and Chief

Financial Officer

THE BANK OF NEW YORK

TRUST COMPANY, N.A.

	 	 	 
	By:

	 	/s/ Patrick Giordano
	
 
	 	 
	 
	 	 
	
 
	 	Vice President
	 
	 	 

4EX-10.1

Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS AGREEMENT, made and entered into as of this 1st day of January, 2005, by and between The
Kansas City Southern Railway Company, a Missouri corporation (“Railway”), Kansas City Southern, a
Delaware corporation (“KCS”) and Arthur L. Shoener, an individual (“Executive”).

WHEREAS, Executive has been offered employment by Railway, and Railway, KCS and Executive
desire for Railway to continue to employ Executive on the terms and conditions set forth in this
Agreement and to provide an incentive to Executive to remain in the employ of Railway hereafter,
particularly in the event of any change in control (as herein defined) of KCS, or Railway, thereby
establishing and preserving continuity of management of Railway.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, it
is agreed by and between Railway, KCS and Executive as follows:

1. Employment. Railway hereby employs Executive as its President and Chief Executive
Officer to serve at the pleasure of the Board of Directors of Railway (the “Railway Board”) and to
have such duties, powers and responsibilities as may be prescribed or delegated from time to time
by the President or other officer to whom Executive reports, subject to the powers vested in the
Railway Board and in the stockholders of Railway. Executive shall faithfully perform his duties
under this Agreement to the best of his ability and shall devote substantially all of his working
time and efforts to the business and affairs of Railway and its affiliates.

2. Compensation.

(a) Base Compensation. Railway shall pay Executive as compensation for his services
hereunder an annual base salary at the rate approved by the Railway’s Compensation Committee. Such
rate shall not be reduced except as agreed by the parties or except as part of a general salary
reduction program imposed by Railway for non-union employees and applicable to all officers of
Railway, not related to a Change of Control.

3. Benefits. During the period of his employment hereunder, Railway shall provide
Executive with coverage under such benefit plans and programs as are made generally available to
similarly situated employees of Railway, provided (a) Railway shall have no obligation with respect
to any plan or program if Executive is not eligible for coverage thereunder, and (b) Executive
acknowledges that stock options and other stock and equity participation awards are granted in the
discretion of the Railway Board or the Compensation Committee of the Railway Board and that
Executive has no right to receive stock options or other equity participation awards or any
particular number or level of stock options or other awards. In determining contributions,
coverage and benefits under any disability insurance policy and under any cash compensation-based
plan provided to Executive by Railway, it shall be assumed that the value of Executive’s annual
compensation, pursuant to this Agreement, is 175% of Executive’s annual base salary. Executive
acknowledges that all rights and benefits under benefit plans and programs shall be governed by the
official text of each plan or program and not by any summary or description thereof or any
provision of this Agreement (except to the extent that this Agreement expressly modifies such
benefit plans or programs) and that neither KCS, nor Railway is under any obligation to continue in
effect or to fund any such plan or program, except as provided in Paragraph 7 hereof.

4. Term and Termination.

The “Term” of this Agreement shall begin on the date first written above and continue until
terminated as provided in (a) through (d) of this Section 4.

(a) Termination by Executive. Executive may terminate this Agreement and his
employment hereunder by providing at least thirty (30) days advance written notice to Railway,
except that in the event of any material breach of this Agreement by Railway, Executive may
terminate this Agreement and his employment hereunder immediately upon notice to Railway.

(b) Death or Disability. This Agreement and Executive’s employment hereunder shall
terminate automatically on the death or disability of Executive, except to the extent employment is
continued under Railway’s disability plan. For purposes of this Agreement, Executive shall be
deemed to be disabled if he qualifies for disability benefits under Railway’s long-term disability
plan.

(c) Termination by Railway For Cause. Railway may terminate this Agreement and
Executive’s employment “for cause” immediately upon notice to Executive. For purposes of this
Agreement (except for Paragraph 7), termination “for cause” shall mean termination based upon any
one or more of the following:

(i) Any material breach of this Agreement by Executive;

(ii) Executive’s dishonesty involving Railway, KCS, or any subsidiary of Railway or
KCS;

(iii) Gross negligence or willful misconduct in the performance of Executive’s duties
as determined in good faith by the Railway Board;

(iv) Executive’s failure to substantially perform his duties and responsibilities
hereunder, including without limitation Executive’s willful failure to follow reasonable
instructions of the President or other officer to whom Executive reports;

(v) Executive’s breach of an express employment policy of Railway or its affiliates;

(vi) Executive’s fraud or criminal activity;

(vii) Embezzlement or misappropriation by Executive; or

(viii) Executive’s breach of his fiduciary duty to Railway, or KCS, or their
affiliates.

(d) Termination by Railway Other Than For Cause.

(i) Railway may terminate this Agreement and Executive’s employment other than for
cause immediately upon notice to Executive, and in such event, Railway shall provide
severance benefits to Executive in accordance with Paragraph 4(d)(ii) below. Executive
acknowledges and agrees that such severance benefits constitute the exclusive remedy of
Executive upon termination of employment other than for cause. Notwithstanding any other
provision of this Agreement, as a condition to receiving such severance benefits, Executive
shall execute a full release of claims in favor of Railway and KCS and their affiliates in
the form Attached hereto as Appendix A.

(ii) Unless the provisions of Paragraph 7 of this Agreement are applicable, if
Executive’s employment is terminated under Paragraph 4(d)(i), Railway shall continue, for a
period of one (1) year following such termination, (a) to pay to Executive as severance pay
a monthly amount equal to one-twelfth (1/12th) of the annual base salary referenced in
Paragraph 2(a) above, at the rate in effect immediately prior to termination, and, (b) to
reimburse Executive for the cost (including state and federal income taxes payable with
respect to this reimbursement) of continuing the health insurance coverage provided pursuant
to this Agreement or obtaining health insurance coverage comparable to the health insurance
provided pursuant to this Agreement, and obtaining coverage comparable to the life insurance
provided pursuant to this Agreement, unless Executive is provided comparable health or life
insurance coverage in connection with other employment. The foregoing obligations of
Railway shall continue until the end of such one (1) year period notwithstanding the death
or disability of Executive during said period (except, in the event of death, the obligation
to reimburse Executive for the cost of life insurance shall not continue). In the year in
which termination of employment occurs, Executive shall be eligible to receive benefits
under the Railway Incentive Compensation Plan and any Executive Plan in which Executive
participates (the “Executive Plan”) (if such Plans then are in existence and Executive was
entitled to participate immediately prior to termination) in accordance with the provisions
of such plans then applicable, and severance pay received in such year shall be taken into
account for the purpose of determining benefits, if any, under the Railway Incentive
Compensation Plan but not under the Executive Plan. After the year in which termination
occurs, Executive shall not be entitled to accrue or receive benefits under the Railway
Incentive Compensation Plan or the Executive Plan with respect to the severance pay provided
herein, notwithstanding that benefits under such plan there are still generally available to
executive employees of Railway. After termination of employment, Executive shall not be
entitled to accrue or receive benefits under any other employee benefit plan or program,
except that Executive shall be entitled to participate in the KCS Section 401(k) and Profit
Sharing Plan and the KCS Employee Stock Ownership Plan (if Railway employees then still
participate in such plans) in the year of termination of employment only if Executive meets
all requirements of such plans for participation in such year.

5. Confidentiality and Non-Disclosure.

(a) Executive understands and agrees that he will be given Confidential Information (as
defined below) during his employment with Railway relating to the business of Railway, KCS and/or
their affiliates, in exchange for his agreement herein. Executive hereby expressly agrees to
maintain in strictest confidence and not to use in any way (including without limitation in any
future business relationship of Executive), publish, disclose or authorize anyone else to use,
publish or disclose in any way, any Confidential Information relating in any manner to the business
or affairs of Railway, KCS and/or their affiliates. Executive agrees further not to remove or
retain any figures, calculations, letters, documents, lists, papers, or copies thereof, which
embody Confidential Information of Railway, KCS and/or their affiliates, and to return, prior to
Executive’s termination of employment for any reason, any such information in Executive’s
possession. If Executive discovers, or comes into possession of, any such information after his
termination he shall promptly return it to Railway. Executive acknowledges that the provisions of
this paragraph are consistent with Railway’s policies and procedures to which Executive, as an
employee of Railway, is bound.

(b) For purposes of this Agreement, “Confidential Information” includes, but is not limited
to, information in the possession of, prepared by, obtained by, compiled by, or that is used by
Railway, KCS or their affiliates or customers, and: (i) is proprietary to, about, or created by
Railway, KCS or their affiliates or customers; (ii) gives Railway, KCS or their affiliates or
customers some competitive business advantage, the opportunity of obtaining such advantage, or
disclosure of which might be detrimental to the interest of Railway, KCS or their affiliates or
customers; and (iii) is not typically disclosed by Railway, KCS or their affiliates or customers,
or known by persons who are not employed by Railway, KCS or their affiliates or customers. Without
in any way limiting the foregoing and by way of example, Confidential Information shall include:
information pertaining to Railway’s, KCS’s or their affiliates’ business operations such as
financial and operational information and data, operational plans and strategies, business and
marketing strategies, pricing information, plans for various products and services, and acquisition
and divestiture planning.

(c). In the event of any breach of this Paragraph 5 by Executive, Railway shall be entitled to
terminate any and all remaining severance benefits under Paragraph 4(d)(ii) and shall be entitled
to pursue such other legal and equitable remedies as may be available. Executive acknowledges,
understands and agrees that Railway, KCS and/or their affiliates will suffer immediate and
irreparable harm if Executive fails to comply with any of his obligations under Paragraph 5 of this
Agreement, and that monetary damages alone will be inadequate to compensate Railway, KCS or their
affiliates for such breach. Accordingly, Executive agrees that Railway, KCS and/or their
affiliates shall, in addition to any other remedies available to it at law or in equity, be
entitled to temporary, preliminary, and permanent injunctive relief and specific performance to
enforce the terms of Paragraph 5 without the necessity of proving inadequacy of legal remedies or
irreparable harm or posting bond.

6. Duties Upon Termination; Survival.

(a) Duties. Upon termination of this Agreement by Railway or Executive for any
reason, Executive shall immediately sign such written resignations from all positions as an
officer, director or member of any committee or board of Railway and all direct and indirect
subsidiaries and affiliates of Railway as may be requested by Railway and shall sign such other
documents and papers relating to Executive’s employment, benefits and benefit plans as Railway may
reasonably request.

(b) Survival. The provisions of Paragraphs 5, 6(a) and 7 of this Agreement shall
survive any termination of this Agreement by Railway or Executive, and the provisions of Paragraph
4(d)(ii) shall survive any termination of this Agreement by Railway under Paragraph 4(d)(i).

7. Continuation of Employment Upon Change in Control.

(a) Continuation of Employment. Subject to the terms and conditions of this Paragraph
7, in the event of a Change in Control (as defined in Paragraph 7(d)) at any time during the term
of this Agreement, Executive agrees to remain in the employ of Railway for a period of three years
(the “Three Year Period”) from the date of such Change in Control (the “Control Change Date”).
Railway agrees to continue to employ Executive for the Three Year Period. During the Three Year
Period, (i) the Executive’s position (including offices, titles, reporting requirements and
responsibilities), authority and duties shall be at least commensurate in all material respects
with the most significant of those held, exercised and assigned at any time during the 12 month
period immediately before the Control Change Date and (ii) the Executive’s services shall be
performed at the location where Executive was employed immediately before the Control Change Date
or at any other location less than 40 miles from such former location. During the Three Year
Period, Railway shall continue to pay to Executive an annual base salary on the same basis and at
the same intervals as in effect prior to the Control Change Date at a rate not less than 12 times
the highest monthly base salary paid or payable to the Executive by Railway in respect of the
12-month period immediately before the Control Change Date.

(b) Benefits. During the Three-Year Period, Executive shall be entitled to
participate, on the basis of his executive position, in each of the following KCS, or Railway
plans (together, the “Specified Benefits”) in existence, and in accordance with the terms thereof,
at the Control Change Date:

(i) any benefit plan, and trust fund associated therewith, related to: (A) life,
health, dental, disability, accidental death and dismemberment insurance or accrued but
unpaid vacation time; (B) profit sharing, thrift or deferred savings (including deferred
compensation, such as under Sec. 401(k) plans); (C) retirement or pension benefits; (D)
ERISA excess benefits and similar plans and (E) tax favored employee stock ownership (such
as under ESOP, and Employee Stock Purchase programs); and

(ii) any other benefit plans hereafter made generally available to executives of
Executive’s level or to the employees of Railway generally.

In addition, Railway and KCS shall use their best efforts to cause all outstanding options
held by Executive under any stock option plan of KCS or its affiliates to become immediately
exercisable on the Control Change Date and to the extent that such options are not vested and are
subsequently forfeited, the Executive shall receive a lump-sum cash payment within 5 days after the
options are forfeited equal to the difference between the fair market value of the shares of stock
subject to the non-vested, forfeited options determined as of the date such options are forfeited
and the exercise price for such options. During the Three-Year Period Executive shall be entitled
to participate, on the basis of his executive position, in any incentive compensation plan of KCS,
or Railway in accordance with the terms thereof at the Control Change Date; provided that if under
KCS, or Railway programs or Executive’s Employment Agreement in existence immediately prior to the
Control Change Date, there are written limitations on participation for a designated time period in
any incentive compensation plan, such limitations shall continue after the Control Change Date to
the extent so provided for prior to the Control Change Date.

If the amount of contributions or benefits with respect to the Specified Benefits or any
incentive compensation is determined on a discretionary basis under the terms of the Specified
Benefits or any incentive compensation plan immediately prior to the Control Change Date, the
amount of such contributions or benefits during the Three Year Period for each of the Specified
Benefits shall not be less than the average annual contributions or benefits for each Specified
Benefit for the three plan years ending prior to the Control Change Date and, in the case of any
incentive compensation plan, the amount of the incentive compensation during the Three Year Period
shall not be less than 75% of the maximum that could have been paid to the Executive under the
terms of the incentive compensation plan.

(c) Payment. With respect to any plan or agreement under which Executive would be
entitled at the Control Change Date to receive Specified Benefits or incentive compensation as a
general obligation of Railway which has not been separately funded (including specifically, but not
limited to, those referred to under Paragraph 7(b)(i)(D) above), Executive shall receive within
five (5) days after such date full payment in cash of all amounts to which he is then entitled
thereunder.

(d) Change in Control. For purposes of this Agreement, a “Change in Control” shall be
deemed to have occurred if:

(i) for any reason at any time less than seventy-five percent (75%) of the members of
the KCS Board shall be individuals who fall into any of the following categories: (A)
individuals who were members of the KCS Board on the date of the Agreement; or (B)
individuals whose election, or nomination for election by KCS’s stockholders, was approved
by a vote of at least seventy-five percent (75%) of the members of the KCS Board then still
in office who were members of the KCS Board on the date of the Agreement; or (C) individuals
whose election, or nomination for election, by KCS’s stockholders, was approved by a vote of
at least seventy-five percent (75%) of the members of the KCS Board then still in office who
were elected in the manner described in (A) or (B) above, or

(ii) any “person” (as such term is used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934 (the “Exchange Act”)) other than KCS shall have become after
September 18, 1997, according to a public announcement or filing, the “beneficial owner” (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of
Railway or KCS representing thirty percent (30%) (or, with respect to Paragraph 7(c) hereof,
40%) or more (calculated in accordance with Rule 13d-3) of the combined voting power of
Railway’s or KCS’s then outstanding voting securities; or

(iii) the stockholders of Railway or KCS shall have approved a merger, consolidation or
dissolution of Railway or KCS or a sale, lease, exchange or disposition of all or
substantially all of Railway’s or KCS’s assets, if persons who were the beneficial owners
of the combined voting power of Railway’s or KCS’s voting securities immediately before any
such merger, consolidation, dissolution, sale, lease, exchange or disposition do not
immediately thereafter, beneficially own, directly or indirectly, in substantially the same
proportions, more than 60% of the combined voting power of any corporation or other entity
resulting from any such transaction.

(e) Termination After Control Change Date. Notwithstanding any other provision of
this Paragraph 7, at any time after the Control Change Date, Railway may terminate the employment
of Executive (the “Termination”), but unless such Termination is for Cause as defined in
subparagraph (g) or for disability, within five (5) days of the Termination Railway shall pay to
Executive his full base salary through the Termination, to the extent not theretofore paid, plus a
lump sum amount (the “Special Severance Payment”) equal to the product of (i) 175% of his annual
base salary specified in Paragraph 7(a) multiplied by (ii) Three; and Specified Benefits (excluding
any incentive compensation) to which Executive was entitled immediately prior to Termination shall
continue until the end of the 3-year period (“Benefits Period”) beginning on the date of
Termination. If any plan pursuant to which Specified Benefits are provided immediately prior to
Termination would not permit continued participation by Executive after Termination, then Railway
shall pay to Executive within five (5) days after Termination a lump sum payment equal to the
amount of Specified Benefits Executive would have received under such plan if Executive had been
fully vested in the average annual contributions or benefits in effect for the three plan years
ending prior to the Control Change Date (regardless of any limitations based on the earnings or
performance of KCS, or Railway) and a continuing participant in such plan to the end of the
Benefits Period. Following the end of the Benefits Period, Railway shall continue to provide to
the Executive and the Executive’s family the following benefits (“Post-Period Benefits”): (1) prior
to the Executive’s attainment of age sixty (60), health, prescription and dental benefits
equivalent to those then applicable to active peer executives of Railway) and their families, as
the same may be modified from time to time, and (2) following the Executive’s attainment of age
sixty (60) (and without regard to the Executive’s period of service with Railway) health and
prescription benefits equivalent to those then applicable to retired peer executives of Railway and
their families immediately prior to the Change of Control. The cost to the Executive of such
Post-Period Benefits shall not exceed the cost of such benefits to active or retired (as
applicable) peer executives immediately prior to the Change of Control. Notwithstanding the
preceding two sentences of this Paragraph 7(e), if the Executive is covered under any health,
prescription or dental plan provided by a subsequent employer, then the corresponding type of plan
coverage (i.e., health, prescription or dental), required to be provided as Post-Period Benefits
under this Paragraph 7(e) shall cease. The Executive’s rights under this Paragraph 7(e) shall be
in addition to, and not in lieu of, any post-termination continuation coverage or conversion rights
the Executive may have pursuant to applicable law, including without limitation continuation
coverage required by Section 4980 of the Code. Nothing in this Paragraph 7(e) shall be deemed to
limit in any manner the reserved right of Railway, in its sole and absolute discretion, to at any
time amend, modify or terminate health, prescription or dental benefits for active or retired
employees generally.

(f) Resignation After Control Change Date. In the event of a Change in Control as
defined in Paragraph 7(d), thereafter, upon good reason (as defined below), Executive may, at any
time during the three-year period following the Change in Control, in his sole discretion, on not
less than thirty (30) days’ written notice (the “Notice of Resignation”) to the Secretary of
Railway and effective at the end of such notice period, resign his employment with Railway (the
“Resignation”). Within five (5) days of such a Resignation, Railway shall pay to Executive his
full base salary through the effective date of such Resignation, to the extent not theretofore
paid, plus a lump sum amount equal to the Special Severance Payment (computed as provided in the
first sentence of Paragraph 7(e), except that for purposes of such computation all references to
“Termination” shall be deemed to be references to “Resignation”). Upon Resignation of Executive,
Specified Benefits to which Executive was entitled immediately prior to Resignation shall continue
on the same terms and conditions as provided in Paragraph 7(e) in the case of Termination
(including equivalent payments provided for therein), and Post-Period Benefits shall be provided on
the same terms and conditions as provided in Paragraph 7(e) in the case of Termination. For
purposes of this Agreement, “good reason” means any of the following:

(i) the assignment of the Executive of any duties inconsistent in any respect with the
Executive’s position (including offices, titles, reporting requirements or
responsibilities), authority or duties as contemplated by Section 7(a)(i), or any other
action by Railway which results in a diminution or other material adverse change in such
position, authority or duties;

(ii) any failure by Railway to comply with any of the provisions of Paragraph 7;

(iii) Railway’s requiring the Executive to be based at any office or location other
than the location described in Section 7(a)(ii);

(iv) any other material adverse change to the terms and conditions of the Executive’s
employment; or

(v) any purported termination by Railway of the Executive’s employment other than as
expressly permitted by this Agreement (any such purported termination shall not be effective
for any other purpose under this Agreement).

A passage of time prior to delivery of the Notice of Resignation or a failure by the Executive to
include in the Notice of Resignation any fact or circumstance which contributes to a showing of
Good Reason shall not waive any right of the Executive under this Agreement or preclude the
Executive from asserting such fact or circumstance in enforcing rights under this Agreement.

(g) Termination for Cause After Control Change Date. Notwithstanding any other
provision of this Paragraph 7, at any time after the Control Change Date, Executive may be
terminated by Railway “for cause.” Cause means commission by the Executive of any felony or
willful breach of duty by the Executive in the course of the Executive’s employment; except that
Cause shall not mean:

(i) bad judgment or negligence;

(ii) any act or omission believed by the Executive in good faith to have been in or not
opposed to the interest of Railway (without intent of the Executive to gain, directly or
indirectly, a profit to which the Executive was not legally entitled);

(iii) any act or omission with respect to which a determination could properly have
been made by the Railway Board that the Executive met the applicable standard of conduct for
indemnification or reimbursement under Railway’s by-laws, any applicable indemnification
agreement, or applicable law, in each case in effect at the time of such act or omission; or

(iv) any act or omission with respect to which Notice of Termination of the Executive
is given, more than 12 months after the earliest date on which any member of the Railway
Board, not a party to the act or omission, knew or should have known of such act or
omission.

Any Termination of the Executive’s employment by Railway for Cause shall be communicated to the
Executive by Notice of Termination.

(h) Gross-up for Certain Taxes. If it is determined (by the reasonable computation of
Railway’s independent auditors, which determinations shall be certified to by such auditors and set
forth in a written certificate (“Certificate”) delivered to the Executive) that any benefit
received or deemed received by the Executive from Railway, or KCS pursuant to this Agreement or
otherwise (collectively, the “Payments”) is or will become subject to any excise tax under Section
4999 of the Code or any similar tax payable under any United States federal, state, local or other
law (such excise tax and all such similar taxes collectively, “Excise Taxes”), then Railway shall,
immediately after such determination, pay the Executive an amount (the “Gross-up Payment”) equal to
the product of:

(i) the amount of such Excise Taxes; multiplied by

(ii) the Gross-up Multiple (as defined in Paragraph 7(k)).

The Gross-up Payment is intended to compensate the Executive for the Excise Taxes and
any federal, state, local or other income or excise taxes or other taxes payable by the
Executive with respect to the Gross-up Payment.

Railway shall cause the preparation and delivery to the Executive of a Certificate upon
request at any time. Railway shall, in addition to complying with this Paragraph 7(h),
cause all determinations and certifications under Paragraphs 7(h)-(o) to be made as soon as
reasonably possible and in adequate time to permit the Executive to prepare and file the
Executive’s individual tax returns on a timely basis.

(i) Determination by the Executive.

(i) If Railway shall fail to: (A) deliver a Certificate to the Executive or (B) pay to
the Executive the amount of the Gross-up Payment, if any, within 14 days after receipt from
the Executive of a written request for a Certificate, or if at any time following receipt of
a Certificate the Executive disputes the amount of the Gross-up Payment set forth therein,
the Executive may elect to demand the payment of the amount which the Executive, in
accordance with an opinion of counsel to the Executive (“Executive Counsel Opinion”),
determines to be the Gross-up Payment. Any such demand by the Executive shall be made by
delivery to Railway of a written notice which specifies the Gross-up Payment determined by
the Executive and an Executive Counsel Opinion regarding such Gross-up Payment (such written
notice and opinion collectively, the “Executive’s Determination”). Within 14 days after
delivery of the Executive’s Determination to Railway, Railway shall either: (A) pay the
Executive the Gross-up Payment set forth in the Executive’s Determination (less the portion
of such amount, if any, previously paid to the Executive by Railway) or (B) deliver to the
Executive a Certificate specifying the Gross-up Payment determined by Railway’s independent
auditors, together with an opinion of Railway’s counsel (“Railway Counsel Opinion”), and pay
the Executive the Gross-up Payment specified in such Certificate. If for any reason Railway
fails to comply with clause (B) of the preceding sentence, the Gross-up Payment specified in
the Executive’s Determination shall be controlling for all purposes.

(ii) If the Executive does not make a request for, and Railway does not deliver to the
Executive, a Certificate, Railway shall, for purposes of Paragraph 7(j), be deemed to have
determined that no Gross-up Payment is due.

(j) Additional Gross-up Amounts. If, despite the initial conclusion of Railway and/or
the Executive that certain Payments are neither subject to Excise Taxes nor to be counted in
determining whether other Payments are subject to Excise Taxes (any such item, a “Non-Parachute
Item”), it is later determined (pursuant to subsequently-enacted provisions of the Code, final
regulations or published rulings of the IRS, final IRS determination or judgment of a court of
competent jurisdiction or Railway’s independent auditors) that any of the Non-Parachute Items are
subject to Excise Taxes, or are to be counted in determining whether any Payments are subject to
Excise Taxes, with the result that the amount of Excise Taxes payable by the Executive is greater
than the amount determined by Railway or the Executive pursuant to Paragraph 7(h) or Paragraph
7(i), as applicable, then Railway shall pay the Executive an amount (which shall also be deemed a
Gross-up Payment) equal to the product of:

(i) the sum of (A) such additional Excise Taxes and (B) any interest, fines, penalties,
expenses or other costs incurred by the Executive as a result of having taken a position in
accordance with a determination made pursuant to Paragraph 7(h); multiplied by

(ii) the Gross-up Multiple.

(k) Gross-up Multiple. The Gross-up Multiple shall equal a fraction, the numerator of
which is one (1.0), and the denominator of which is one (1.0) minus the sum, expressed as a decimal
fraction, of the rates of all federal, state, local and other income and other taxes and any Excise
Taxes applicable to the Gross-up Payment; provided that, if such sum exceeds 0.8, it shall be
deemed equal to 0.8 for purposes of this computation. (If different rates of tax are applicable to
various portions of a Gross-up Payment, the weighted average of such rates shall be used.)

(l) Opinion of Counsel. “Executive Counsel Opinion” means a legal opinion of
nationally recognized executive compensation counsel that there is a reasonable basis to support a
conclusion that the Gross-up Payment determined by the Executive has been calculated in accord with
this Paragraph 7 and applicable law. “Company Counsel Opinion” means a legal opinion of nationally
recognized executive compensation counsel that (i) there is a reasonable basis to support a
conclusion that the Gross-up Payment set forth in the Certificate of Railway’s independent auditors
has been calculated in accord with this Paragraph 7 and applicable law, and (ii) there is no
reasonable basis for the calculation of the Gross-up Payment determined by the Executive.

(m) Amount Increased or Contested. The Executive shall notify Railway in writing of
any claim by the IRS or other taxing authority that, if successful, would require the payment by
Railway of a Gross-up Payment. Such notice shall include the nature of such claim and the date on
which such claim is due to be paid. The Executive shall give such notice as soon as practicable,
but no later than 10 business days, after the Executive first obtains actual knowledge of such
claim; provided, however, that any failure to give or delay in giving such notice shall affect
Railway’s obligations under this Paragraph 7 only if and to the extent that such failure results in
actual prejudice to Railway. The Executive shall not pay such claim less than 30 days after the
Executive gives such notice to Railway (or, if sooner, the date on which payment of such claim is
due). If Railway notifies the Executive in writing before the expiration of such period that it
desires to contest such claim, the Executive shall:

(i) give Railway any information that it reasonably requests relating to such claim;

(ii) take such action in connection with contesting such claim as Railway reasonably
requests in writing from time to time, including, without limitation, accepting legal
representation with respect to such claim by an attorney reasonably selected by Railway;

(iii) cooperate with Railway in good faith to contest such claim; and

(iv) permit Railway to participate in any proceedings relating to such claim; provided,
however, that Railway shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest and shall
indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or
income tax, including related interest and penalties, imposed as a result of such
representation and payment of costs and expenses. Without limiting the foregoing, Railway
shall control all proceedings in connection with such contest and, at its sole option, may
pursue or forego any and all administrative appeals, proceedings, hearings and conferences
with the taxing authority in respect of such claim and may, at its sole option, either
direct the Executive to pay the tax claimed and sue for a refund or contest the claim in any
permissible manner. The Executive agrees to prosecute such contest to a determination
before any administrative tribunal, in a court of initial jurisdiction and in one or more
appellate courts, as Railway shall determine; provided, however, that if Railway directs the
Executive to pay such claim and sue for a refund, Railway shall advance the amount of such
payment to the Executive, on are interest-free basis and shall indemnify the Executive, on
an after-tax basis, for any Excise Tax or income tax, including related interest or
penalties, imposed with respect to such advance; and further provided that any extension of
the statute of limitations relating to payment of taxes for the taxable year of the
Executive with respect to which such contested amount is claimed to be due is limited solely
to such contested amount. The Railway’s control of the contest shall be limited to issues
with respect to which a Gross-up Payment would be payable. The Executive shall be entitled
to settle or contest, as the case may be, any other issue raised by the IRS or other taxing
authority.

(n) Refunds. If, after the receipt by the Executive of an amount advanced by Railway
pursuant to Paragraph 7(m), the Executive receives any refund with respect to such claim, the
Executive shall (subject to Railway’s complying with the requirements of Paragraph 7(m)) promptly
pay Railway the amount of such refund (together with any interest paid or credited thereon after
taxes applicable thereto). If, after the receipt by the Executive of an amount advanced by Railway
pursuant to Paragraph 7(m), a determination is made that the Executive shall not be entitled to a
full refund with respect to such claim and Railway does not notify the Executive in writing of its
intent to contest such determination before the expiration of 30 days after such determination,
then the applicable part of such advance shall be forgiven and shall not be required to be repaid
and the amount of such advance shall offset, to the extent thereof, the amount of Gross-up Payment
required to be paid. Any contest of a denial of refund shall be controlled by Paragraph 7(m).

(o) Expenses. If any dispute should arise under this Agreement after the Control
Change Date involving an effort by Executive to protect, enforce or secure rights or benefits
claimed by Executive hereunder, Railway shall pay (promptly upon demand by Executive accompanied by
reasonable evidence of incurrence) all reasonable expenses (including attorneys’ fees) incurred by
Executive in connection with such dispute, without regard to whether Executive prevails in such
dispute except that Executive shall repay Railway any amounts so received if a court having
jurisdiction shall make a final, nonappealable determination that Executive acted frivolously or in
bad faith by such dispute. To assure Executive that adequate funds will be made available to
discharge Railway’s obligations set forth in the preceding sentence, Railway has established a
trust and upon the occurrence of a Change in Control shall promptly deliver to the trustee of such
trust to hold in accordance with the terms and conditions thereof that sum which the Railway Board
shall have determined is reasonably sufficient for such purpose.

(p) Prevailing Provisions. On and after the Control Change Date, the provisions of
this Paragraph 7 shall control and take precedence over any other provisions of this Agreement
which are in conflict with or address the same or a similar subject matter as the provisions of
this Paragraph 7.

8. Mitigation and Other Employment. After a termination of Executive’s employment
pursuant to Paragraph 4(d)(i) or a Change in Control as defined in Paragraph 7(d), Executive shall
not be required to mitigate the amount of any payment provided for in this Agreement by seeking
other employment or otherwise, and except as otherwise specifically provided in Paragraph 4(d)(ii)
with respect to health and life insurance and in Paragraph 7(e) with respect to health,
prescription and dental benefits, no such other employment, if obtained, or compensation or
benefits payable in connection therewith shall reduce any amounts or benefits to which Executive is
entitled hereunder. Such amounts or benefits payable to Executive under this Agreement shall not
be treated as damages but as severance compensation to which Executive is entitled because
Executive’s employment has been terminated.

9. KCS Not An Obligor. Notwithstanding that KCS has executed this Agreement, it shall
have no obligation for the payment of salary, benefits, or other compensation hereunder, and all
such obligations shall be the sole responsibility of Railway.

10. Notice. Notices and all other communications to either party pursuant to this
Agreement shall be in writing and shall be deemed to have been given when personally delivered,
delivered by facsimile or deposited in the United States mail by certified or registered mail,
postage prepaid, addressed, in the case of Railway or KCS, to Railway or KCS at 427 West 12th
Street, Kansas City, Missouri 64105, Attention: Secretary, or, in the case of the Executive, to him
at 427 West 12th Street, Kansas Cty, Missouri, 64105, or to such other address as a
party shall designate by notice to the other party.

11. Amendment. No provision of this Agreement may be amended, modified, waived or
discharged unless such amendment, waiver, modification or discharge is agreed to in writing signed
by Executive, the President of Railway and the President of KCS. No waiver by any party hereto at
any time of any breach by another party hereto of, or compliance with, any condition or provision
of this Agreement to be performed by such other party shall be deemed a waiver of similar or
dissimilar provisions or conditions at the time or at any prior or subsequent time.

12. Successors in Interest. The rights and obligations of KCS and Railway under this
Agreement shall inure to the benefit of and be binding in each and every respect upon the direct
and indirect successors and assigns of KCS and Railway, regardless of the manner in which such
successors or assigns shall succeed to the interest of KCS or Railway hereunder, and this Agreement
shall not be terminated by the voluntary or involuntary dissolution of KCS or Railway or by any
merger or consolidation or acquisition involving KCS or Railway, or upon any transfer of all or
substantially all of KCS’s or Railway’s assets, or terminated otherwise than in accordance with its
terms. In the event of any such merger or consolidation or transfer of assets, the provisions of
this Agreement shall be binding upon and shall inure to the benefit of the surviving corporation or
the corporation or other person to which such assets shall be transferred. Neither this Agreement
nor any of the payments or benefits hereunder may be pledged, assigned or transferred by Executive
either in whole or in part in any manner, without the prior written consent of Railway.

13. Severability. The invalidity or unenforceability of any particular provision of
this Agreement shall not affect the other provisions hereof, and this Agreement shall be construed
in all respects as if such invalid or unenforceable provisions were omitted.

14. Controlling Law and Jurisdiction. The validity, interpretation and performance of
this Agreement shall be subject to and construed under the laws of the State of Missouri, without
regard to principles of conflicts of law.

15. Entire Agreement. This Agreement constitutes the entire agreement among the
parties with respect to the subject matter hereof and terminates and supersedes all other prior
agreements and understandings, both written and oral, between the parties with respect to the terms
of Executive’s employment or severance arrangements.

IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated Agreement as of
the 4th day of January, 2005.

THE KANSAS CITY SOUTHERN RAILWAY COMPANY

By: /s/ Michael R. Haverty 

	 	 	 	Michael R. Haverty, Chairman

KANSAS CITY SOUTHERN

By: /s/ Michael R. Haverty

	 	 	 	Michael R. Haverty, Chairman, President, and CEO

EXECUTIVE

/s/ Arthur L. Shoener

	 	 	 	Arthur L. Shoener

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Appendix A

WAIVER AND RELEASE

In consideration of the benefits described in the Employment Agreement, I do hereby fully waive all
claims and release The Kansas City Southern Railway Company (KCSR), and its affiliates, parents,
subsidiaries, successors, assigns, directors and officers, fiduciaries, employees and agents, as
well as any employee benefit plans from liability and damages related in any way to any claim I may
have against or KCSR. This waiver and release includes, but is not limited to all claims, causes
of action and rights under Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights
Act of 1991; the Age Discrimination in Employment Act of 1967, as amended; the Civil Rights Act of
1866; the American with Disabilities Act of 1990; the Rehabilitation Act of 1973; the Older Workers
Benefit Protection Act of 1990; the Employee Retirement Income Security Act of 1974, as amended;
the Worker Adjustment and Retraining Notification Act; the Family and Medical Leave Act; the
Federal Employers Liability Act; the Railway Labor Act, including bumping rights, rights to file a
grievance, rights to a hearing (whether before any company official, any system, group, regional or
special adjustment board, the National Railroad Adjustment Board, or any other entity), and any
rights to arbitration thereunder; the Missouri Human Rights Act, the Kansas Act Against
Discrimination, the Kansas and Missouri Workers’ Compensation acts, and all local state and federal
statutes and regulations; all claims arising from labor protective conditions imposed by the
Interstate Commerce Commission or the Surface Transportation Board; all any KCSR incentive or
benefit plan or program, and any rights under any collective bargaining agreement, including
seniority rights, bumping rights and reinstatement rights, rights to file or assert a grievance or
other complaint, rights to a hearing, or rights to arbitration under such agreement; and all rights
under common law such as breach of contract, tort or personal injury of any sort.

I understand that this Agreement and Release also precludes me from recovering any relief as a
result of any lawsuit, grievance or claims brought on my behalf and arising out of my employment or
resignation of, or separation from employment, provided that nothing in this Agreement and this
Release may affect my entitlement, if any, to workers’ compensation or unemployment compensation.
Additionally, nothing in this Agreement and Release prohibits me from communications with, filing a
complaint with, or full cooperation in the investigations of, any governmental agency on matters
within their jurisdictions. However, as stated above, this Agreement and Release does prohibit me
from recovering any relief, including monetary relief, as a result of such activities.

If any term, provision, covenant, or restriction of this Agreement and Release is held by a court
of competent jurisdiction to be invalid, void or unenforceable, the remainder of this Agreement and
Release and the other terms, provisions, covenants and restrictions hereof shall remain in full
force and effect and shall in no way be affected, impaired or invalidated. I understand and agree
that, in the event of breach by me of any of the terms and conditions of this Agreement and
Release, the Railway will be entitled to recover all costs and expenses as a result of my breach,
including but not limited to, reasonable attorneys’ fees and costs.

I have read this Agreement and Release and I understand all of its terms. I enter into and sign
this Agreement and Release knowingly and voluntarily, with full knowledge of what it means.

	 	 	 	 	 
	/s/ Arthur L. Shoener
	 	January 4, 2004
	 
	 	 	 	 
	Employee Signature
	 	Date
	Arthur L. Shoener
	 	 	—	 
	 
	 	 	 	 
	Employee Name(Please Print)
	 	Social Security Number

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