Document:

EXHIBIT 10.1

                                 AMENDMENT NO. 6
               TO AMENDED AND RESTATED MASTER REPURCHASE AGREEMENT

         AMENDMENT NO. 6 TO AMENDED AND RESTATED MASTER REPURCHASE AGREEMENT,
dated as of December [ ], 2004, (the Amendment") by and between Merrill Lynch
Mortgage Capital Inc. (the "Buyer"), and MortgageIT, Inc. ("MIT" and a "Seller")
and MortgageIT Holdings, Inc. ("Holdings" and a "Seller" and together with MIT
the "Sellers"):

         The Buyer and the Sellers are parties to that certain Amended and
Restated Master Repurchase Agreement, dated as of August 4, 2004, as amended by
Amendment No. 1, dated as of September 21, 2004, Amendment No. 2, dated as of
November 11, 2004, Amendment No. 3, dated as of November 18, 2004, Amendment No.
4, dated as of December 8, 2004, and Amendment No. 5, dated as of December 10,
2004 (the "Existing Repurchase Agreement"; as amended by this Amendment, the
"Repurchase Agreement"). Capitalized terms used but not otherwise defined herein
shall have the meanings given to them in the Existing Repurchase Agreement.

         The Buyer and the Sellers have agreed, subject to the terms and
conditions of this Amendment, that the Existing Repurchase Agreement be amended
to reflect certain agreed upon revisions to the terms of the Existing Repurchase
Agreement.

         Accordingly, the Buyer and the Sellers hereby agree, in consideration
of the mutual premises and mutual obligations set forth herein, that the
Existing Repurchase Agreement is hereby amended as follows:

         Section 1. Definitions. Section 2 of the Existing Repurchase Agreement
is hereby amended by:

         1.1 deleting the definition of "Maximum Purchase Price" in its entirety
and replacing it with the following language:

         "Maximum Purchase Price" shall mean $1,000,000,000.

         1.2 deleting the definition of "Market Value" in its entirety and
replacing it with the following language:

         "Market Value" shall mean, as of any date with respect to any Purchased
Mortgage Loan, the price at which such Mortgage Loan could readily be sold as
determined by the Buyer in its sole good-faith discretion. Without limiting the
generality of the foregoing, the Sellers acknowledge that the Market Value of a
Purchased Mortgage Loan may be reduced to zero by Buyer if:

         (a) such Purchased Mortgage Loan ceases to be an Eligible Mortgage
     Loan;

         (b) the Purchased Mortgage Loan has been released from the possession
     of the Custodian under the Custodial Agreement (other than to a Take-out
     Investor pursuant to a Bailee Letter) for a period in excess of 10 Business
     Days;

         (c) the Purchased Mortgage Loan is a Wet-Ink Mortgage Loan for which
     the related Mortgage File has not been received and certified by the
     Custodian by the seventh Business Day following the related Purchase Date;

         (d) such Purchased Mortgage Loan is a Delinquent Mortgage Loan;

         (e) such Purchased Mortgage Loan is rejected by the related Takeout
     Investor;

         (f) such Purchased Mortgage Loan has been subject to a Transaction
     hereunder for period of greater than 120 days, unless such Purchased
     Mortgage Loan is an Aged Mortgage Loan;

         (g) a First Payment Default occurs with respect to such Purchased
     Mortgage Loan;

         (h) the Buyer has determined in its sole good-faith discretion that the
     Purchased Mortgage Loan is not eligible for whole loan sale or
     securitization in a transaction consistent with the prevailing sale and
     securitization industry with respect to substantially similar Mortgage
     Loans;

         (i) such Purchased Mortgage Loan contains a material breach of a
     representation or warranty made by a Seller in this Repurchase Agreement or
     the Custodial Agreement;

         (j) when the Purchase Price for such Purchased Mortgage Loan is added
     to the aggregate Purchase Price of other Purchased Mortgage Loans, the
     aggregate Purchase Price of all Aged Mortgage Loans exceeds 5% of the
     Maximum Purchase Price;

         (k) when the Purchase Price for such Purchased Mortgage Loan is added
     to the aggregate Purchase Price of other Purchased Mortgage Loans, the
     aggregate Purchase Price of all HELOCs exceeds $100,000,000;

         (l) when the Purchase Price for such Purchased Mortgage Loan is added
     to the aggregate Purchase Price of other Purchased Mortgage Loans, the
     aggregate Purchase Price of all HELOCs that have a FICO score of 680 or
     less exceeds $35,000,000;

         (m) when the Purchase Price for such Purchased Mortgage Loan is added
     to the aggregate Purchase Price of other Purchased Mortgage Loans, the
     aggregate Purchase Price of all Closed End Second Lien Mortgage Loans
     exceeds 5% of the Maximum Purchase Price;

         (n) when the Purchase Price for such Purchased Mortgage Loan is added
     to the aggregate Purchase Price of other Purchased Mortgage Loans, the
     aggregate Purchase Price of all Super Jumbo Mortgage Loans exceeds 7.5% of
     the Maximum Purchase Price;

                                      -2-

         (o) when the Purchase Price for such Purchased Mortgage Loan is added
     to the aggregate Purchase Price of other Purchased Mortgage Loans, the
     aggregate Purchase Price of all EC Mortgage Loans exceeds 5% of the
     aggregate Purchase Price of all Purchased Mortgage Loans;

         (p) when the Purchase Price for such Purchased Mortgage Loan is added
     to the aggregate Purchase Price of other Purchased Mortgage Loans, the
     aggregate Purchase Price of all Wet-Ink Mortgage Loans exceeds (i) with
     respect to the first five (5) Business Days of a month and the last five
     (5) Business Days of a month, $150,000,000 or (ii) with respect to all
     other times, $100,000,000;

         (q) when the Purchase Price for such Purchased Mortgage Loan is added
     to the aggregate Purchase Price of other Purchased Mortgage Loans, the
     aggregate Purchase Price of all Sub-prime Mortgage Loans exceeds 20% of the
     Maximum Purchase Price;

         (r) when the Purchase Price for such Purchased Mortgage Loan is added
     to the aggregate Purchase Price of other Purchased Mortgage Loans, the
     aggregate Purchase Price of all Wet-Ink Mortgage Loans that are Sub-prime
     Mortgage Loans exceeds 4% of the Maximum Purchase Price; and

         (s) when the Purchase Price for such Purchased Mortgage Loan is added
     to the aggregate Purchase Price of other Purchased Mortgage Loans, the
     aggregate Purchase Price of all Co-op Loans exceeds 5% of the aggregate
     Purchase Price of all Purchased Mortgage Loans.

         Section 2. Financial Covenants. Section 12(j) of the Existing
Repurchase Agreement is hereby amended by deleting clause (iii) in its entirety
and replacing it with the following:

         "(iii) Maintenance of Liquidity. The Sellers, on a consolidated basis,
shall ensure that, as of the end of each calendar month, they have cash and Cash
Equivalents in an amount not less than $20,000,000."

         Section 3. Exhibits. Exhibit VIII of the Existing Repurchase Agreement
is hereby amended by deleting it in its entirety and replacing it with Exhibit A
of this Amendment.

         Section 4. Conditions Precedent. This Amendment shall become effective
on the date hereof (the "Amendment Effective Date") subject to the satisfaction
of the following conditions precedent:

         4.1 Delivered Documents. On the Amendment Effective Date, the Buyer
shall have received the following documents, each of which shall be satisfactory
to the Buyer in form and substance:

         (a) this Amendment, executed and delivered by a duly authorized officer
of each of the Buyer and the Sellers; and

                                      -3-

         (b) such other documents as the Buyer or counsel to the Buyer may
reasonably request.

         Section 5. Fees. Each Seller agrees to pay as and when billed by the
Buyer all of the reasonable fees, disbursements and expenses of counsel to the
Buyer in connection with the development, preparation and execution of, this
Amendment or any other documents prepared in connection herewith and receipt of
payment thereof shall be a condition precedent to the Buyer entering into any
Transaction pursuant hereto.

         Section 6. Confidentiality. The parties hereto acknowledge that this
Amendment, the Existing Repurchase Agreement, and all drafts thereof, documents
relating thereto and transactions contemplated thereby are confidential in
nature and the Sellers agree that, unless otherwise directed by a court of
competent jurisdiction, it shall limit the distribution of such documents and
the discussion of such transactions to such of its officers, employees,
attorneys, accountants and agents as is required in order to fulfill its
obligations under such documents and with respect to such transactions.

         Section 7. Limited Effect. Except as expressly amended and modified by
this Amendment, the Existing Repurchase Agreement shall continue to be, and
shall remain, in full force and effect in accordance with its terms.

         Section 8. Counterparts. This Amendment may be executed in one or more
counterparts and by different parties hereto on separate counterparts, each of
which, when so executed, shall constitute one and the same agreement.

         SECTION 9. GOVERNING LAW. THIS AMENDMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.

         Section 10. Conflicts. The parties hereto agree that in the event there
is any conflict between the terms of this Amendment, and the terms of the
Existing Repurchase Agreement, the provisions of this Amendment shall control.

                            [SIGNATURE PAGE FOLLOWS]

                                      -4-

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

Buyer:                                  MERRILL LYNCH MORTGAGE CAPITAL INC.

                                        By: /s/ JOHN WINCHESTER
                                            -------------------
                                            Name:  John Winchester
                                            Title: Vice President

Seller:                                 MORTGAGEIT, INC.

                                        By: /s/ JOHN R. CUTI
                                            ----------------
                                            Name:  John R. Cuti
                                            Title: General Counsel and Secretary

Seller:                                 MORTGAGEIT HOLDINGS, INC.

                                        By: /s/ JOHN R. CUTI
                                            ----------------
                                            Name:  John R. Cuti
                                            Title: General Counsel and Secretary

                          EXHIBIT A TO AMENDMENT NO. 6

                                                                    Exhibit VIII
                                                                    ------------

                 [MortgageIT's] [Holdings] Officer's Certificate

         I, ___________________, do hereby certify that I am duly elected,
qualified and authorized officer of [MortgageIT, Inc. (the "MortgageIT")]
[MortgageIT Holdings, Inc. ("Holdings")]. This Certificate is delivered to you
in connection with Section 12(d)(iv) of the Amended and Restated Master
Repurchase Agreement dated as of August 4, 2004, among MortgageIT, Inc.,
MortgageIT Holdings, Inc. and Merrill Lynch Mortgage Capital Inc. (the
"Agreement"). I hereby certify that, as of the date of the financial statements
attached hereto and as of the date hereof, [MortgageIT] [Holdings] is and has
been in compliance with all the terms of the Agreement and, without limiting the
generality of the foregoing, I certify that:

         (i) Maintenance of Tangible Net Worth. The Sellers, on a consolidated
     basis, have maintained a Tangible Net Worth of not less than $175,000,000.
     At no time has MortgageIT individually maintained a Tangible Net Worth at
     the end of any two consecutive calendar quarters of less than $25,000,000.

         (ii) Maintenance of Ratio of Indebtedness to Tangible Net Worth. The
     Sellers, on a consolidated basis, shall maintain the ratio of Indebtedness
     to Tangible Net Worth no greater than 20:1.

         (iii) Maintenance of Liquidity. The Sellers, on a consolidated basis,
     shall ensure that, as of the end of each calendar month, they have cash and
     Cash Equivalents in an amount not less than $20,000,000.

         (iv) No Default or Event of Default has occurred or is continuing. [If
     any Default or Event of Default has occurred and is continuing, Sellers
     shall describe the same in reasonable detail and describe the action the
     Sellers have taken or proposes to take with respect thereto.]

         (v) Attached hereto as Schedule 1 is a true and correct list of all
     Mortgage Loans purchased by Buyer and held by the Custodian pending
     repurchase.

IN WITNESS WHEREOF, I have set my hand this _____ day of ________, ________.

                                        By:
                                           -------------------------------------
                                        Name:
                                             -----------------------------------
                                        Title:
                                              ----------------------------------exv4w1

 

EXHIBIT 4.1

INDENTURE

Dated as of December 15, 2004

Optionally Convertible
Equity-Linked Accreting Notes (OCEANsSM) due March 6, 2032

BETWEEN

AMERUS GROUP CO.

AND

BNY MIDWEST TRUST COMPANY

the Trustee

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	Article 1

DEFINITIONS AND INCORPORATION BY REFERENCE
	 	 	 	 
	Section 1.1 Definitions
	 	 	2	 
	Section 1.2 Other Definitions
	 	 	8	 
	Section 1.3 Incorporation by Reference of Trust Indenture Act
	 	 	9	 
	Section 1.4 Rules of Construction
	 	 	9	 
	Section 1.5 Acts of Holders
	 	 	9	 
	Article 2

THE SECURITIES
	 	 	 	 
	Section 2.1 Form and Dating
	 	 	10	 
	Section 2.2 Execution and Authentication
	 	 	12	 
	Section 2.3 Registrar, Paying Agent, Conversion Agent and Bid Solicitation Agent
	 	 	12	 
	Section 2.4 Paying Agent to Hold Money in Trust
	 	 	13	 
	Section 2.5 Holder Lists
	 	 	13	 
	Section 2.6 Transfer and Exchange
	 	 	13	 
	Section 2.7 Replacement Securities
	 	 	15	 
	Section 2.8 Outstanding Securities; Determinations of Holders’ Action
	 	 	15	 
	Section 2.9 Temporary Securities
	 	 	16	 
	Section 2.10 Cancellation
	 	 	16	 
	Section 2.11 Persons Deemed Owners
	 	 	16	 
	Section 2.12 Global Securities
	 	 	17	 
	Section 2.13 CUSIP Numbers
	 	 	18	 
	Section 2.14 Deferral of Interest; Notice of Deferral
	 	 	19	 
	Article 3

REDEMPTION AND PURCHASES
	 	 	 	 
	Section 3.1 Right to Redeem
	 	 	20	 
	Section 3.2 Selection of Securities to Be Redeemed
	 	 	21	 
	Section 3.3 Notice of Redemption
	 	 	21	 
	Section 3.4 Effect of Notice of Redemption
	 	 	22	 
	Section 3.5 Deposit of Redemption Price
	 	 	22	 
	Section 3.6 Securities Redeemed in Part
	 	 	22	 
	Section 3.7 Notice to Trustee
	 	 	22	 
	Section 3.8 Purchase of Securities at Option of the Holder upon Change of Control
	 	 	23	 
	Section 3.9 Effect of Change of Control Purchase Notice; Withdrawal of Change
of Control Purchase Notice
	 	 	25	 
	Section 3.10 Deposit of Change of Control Purchase Price
	 	 	26	 
	Section 3.11 Securities Purchased in Part
	 	 	26	 
	Section 3.12 Covenant to Comply with Securities Laws upon Purchase of Securities
	 	 	26	 
	Section 3.13 Repayment to the Company
	 	 	26	 
	Article 4

COVENANTS
	 	 	 	 
	Section 4.1 Payment of Securities
	 	 	26	 
	Section 4.2 Compliance Certificate
	 	 	27	 
	Section 4.3 Further Instruments and Acts
	 	 	27	 
	Section 4.4 Maintenance of Office or Agency
	 	 	27	 
	Section 4.5 Tax Treatment of Securities
	 	 	27	 

i

 

	 	 	 	 	 
	Article 5

SUCCESSOR CORPORATION
	 	 	 	 
	Section 5.1 When Company May Merge or Transfer Assets
	 	 	28	 
	Article 6

DEFAULTS AND REMEDIES
	 	 	 	 
	Section 6.1 Events of Default
	 	 	29	 
	Section 6.2 Acceleration
	 	 	30	 
	Section 6.3 Other Remedies
	 	 	30	 
	Section 6.4 Waiver of Past Defaults
	 	 	30	 
	Section 6.5 Control by Majority
	 	 	30	 
	Section 6.6 Limitation on Suits
	 	 	31	 
	Section 6.7 Rights of Holders to Receive Payment
	 	 	31	 
	Section 6.8 Collection Suit by Trustee
	 	 	31	 
	Section 6.9 Trustee May File Proofs of Claim
	 	 	31	 
	Section 6.10 Priorities
	 	 	32	 
	Section 6.11 Undertaking for Costs
	 	 	32	 
	Section 6.12 Waiver of Stay, Extension or Usury Laws
	 	 	33	 
	Article 7

TRUSTEE
	 	 	 	 
	Section 7.1 Duties of Trustee
	 	 	33	 
	Section 7.2 Rights of Trustee
	 	 	34	 
	Section 7.3 Individual Rights of Trustee
	 	 	35	 
	Section 7.4 Trustee’s Disclaimer
	 	 	35	 
	Section 7.5 Notice of Defaults
	 	 	35	 
	Section 7.6 Reports by Trustee to Holders
	 	 	35	 
	Section 7.7 Compensation and Indemnity
	 	 	36	 
	Section 7.8 Replacement of Trustee
	 	 	36	 
	Section 7.9 Successor Trustee by Merger
	 	 	37	 
	Section 7.10 Eligibility; Disqualification
	 	 	37	 
	Section 7.11 Preferential Collection of Claims Against Company
	 	 	37	 
	Article 8

DISCHARGE OF INDENTURE
	 	 	 	 
	Section 8.1 Discharge of Liability on Securities
	 	 	37	 
	Section 8.2 Repayment to the Company
	 	 	38	 
	Article 9

AMENDMENTS, SUPPLEMENTS AND WAIVERS
	 	 	 	 
	Section 9.1 Without Consent of Holders
	 	 	38	 
	Section 9.2 With Consent of Holders
	 	 	38	 
	Section 9.3 Compliance with Trust Indenture Act
	 	 	39	 
	Section 9.4 Revocation and Effect of Consents
	 	 	39	 
	Section 9.5 Notation on or Exchange of Securities
	 	 	39	 
	Section 9.6 Trustee to Sign Supplemental Indentures
	 	 	40	 
	Section 9.7 Effect of Supplemental Indentures
	 	 	40	 
	Article 10

CONVERSIONS
	 	 	 	 
	Section 10.1 Conversion Privilege
	 	 	40	 
	Section 10.2 Conversion Procedure; Fractional Shares
	 	 	43	 
	Section 10.3 Payment Upon Conversion
	 	 	44	 
	Section 10.4 Adjustments of Conversion Price for Common Stock
	 	 	47	 
	Section 10.5 Consolidation or Merger of the Company
	 	 	54	 
	Section 10.6 Notice of Adjustment
	 	 	55	 
	Section 10.7 Notice in Certain Events
	 	 	55	 
	Section 10.8 Company to Reserve Stock; Registration; Listing
	 	 	56	 
	Section 10.9 Taxes on Conversion
	 	 	56	 
	Section 10.10 Securities Deemed Paid in Full on Conversion
	 	 	56	 

ii

 

	 	 	 	 	 
	Section 10.11 Company Determination Final
	 	 	57	 
	Section 10.12 Responsibility of Trustee for Conversion Provisions
	 	 	57	 
	Section 10.13 Unconditional Right of Holders to Convert
	 	 	57	 
	Section 10.14 Calculation of Conversion Make-Whole Premium
	 	 	57	 
	Article 11

SUBORDINATION OF SECURITIES
	 	 	 	 
	Section 11.1 Securities Subordinate to Senior Debt
	 	 	59	 
	Section 11.2 Payment Over of Proceeds upon Dissolution, Etc
	 	 	60	 
	Section 11.3 Prior Payment to Senior Debt upon Acceleration of Securities
	 	 	61	 
	Section 11.4 No Payment When Senior Debt in Default
	 	 	61	 
	Section 11.5 Payment Permitted If No Default
	 	 	62	 
	Section 11.6 Subrogation to Rights of Holders of Senior Debt
	 	 	62	 
	Section 11.7 Provisions Solely to Define Relative Rights
	 	 	62	 
	Section 11.8 Trustee to Effectuate Subordination
	 	 	63	 
	Section 11.9 No Waiver of Subordination Provisions
	 	 	63	 
	Section 11.10 Notice to Trustee
	 	 	63	 
	Section 11.11 Reliance on Judicial Order or Certificate of Liquidating Agent
	 	 	64	 
	Section 11.12 Trustee Not Fiduciary for Holders of Senior Debt
	 	 	64	 
	Section 11.13 Rights of Trustee as Holder of Senior Debt, Preservation of Trustee’s Rights
	 	 	64	 
	Section 11.14 Article Applicable to Paying Agents
	 	 	64	 
	Section 11.15 Certain Conversions or Exchanges Deemed Payment
	 	 	64	 
	Section 11.16 Ranking of Securities in Relation to Existing Securities
	 	 	65	 
	Article 12

MISCELLANEOUS
	 	 	 	 
	Section 12.1 Trust Indenture Act Controls
	 	 	65	 
	Section 12.2 Notices
	 	 	65	 
	Section 12.3 Communication by Holders with Other Holders
	 	 	66	 
	Section 12.4 Certificate and Opinion as to Conditions Precedent
	 	 	66	 
	Section 12.5 Statements Required in Certificate or Opinion
	 	 	66	 
	Section 12.6 Separability Clause
	 	 	66	 
	Section 12.7 Rules by Trustee, Paying Agent, Conversion Agent, Registrar and Bid Solicitation Agent
	 	 	66	 
	Section 12.8 Legal Holidays
	 	 	66	 
	Section 12.9 Governing Law
	 	 	67	 
	Section 12.10 No Recourse Against Others
	 	 	67	 
	Section 12.11 Successors
	 	 	67	 
	Section 12.12 Multiple Originals
	 	 	67	 
	Section 12.13 Waiver of Jury Trial
	 	 	67	 
	EXHIBITS
	 	 	 	 
	EXHIBIT A: Form of Security
	 	 	A-1	 
	EXHIBIT B: Transfer Certificate
	 	 	A-2	 
	EXHIBIT C: Projected Payment Schedule
	 	 	A-3	 

iii

 

     INDENTURE dated as of December 15, 2004 between AmerUs Group Co., an Iowa
corporation (the “Company”) and BNY Midwest Trust Company, an Illinois trust
company (the “Trustee”).

     Each party agrees as follows for the benefit of the other parties and for
the equal and ratable benefit of the Holders of the Company’s Optionally
Convertible Equity-Linked Accreting Notes (OCEANsSM) due March 6, 2032 (the
“Securities”):

ARTICLE 1

DEFINITIONS AND INCORPORATION BY REFERENCE

               Section 1.1 Definitions. “Accreted Principal Amount” shall have the
meaning set forth in paragraph 1 of the Securities.

               “Affiliate” of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
“control” when used with respect to any specified Person means the power to
direct or cause the direction of the management and policies of such Person,
directly or indirectly, whether through the own
ership of voting securities, by
contract or otherwise; and the terms “controlling” and “controlled” have
meanings correlative to the foregoing.

               “Applicable Limit” means (i) at any time prior to March 6, 2007,
$25,000,000, and (ii) at any time on or after March 6, 2007, $50,000,000.

               “Associate” shall have the meaning ascribed to such term in Rule 12b-2 of
the General Rules and Regulations under the Exchange Act, as in effect on the
date hereof.

               “Board of Directors” means either the board of directors of the Company or
any duly authorized committee of such board.

               “Board Resolution” means a copy of one or more resolutions, certified by
an Officer of the Company to have been duly adopted or consented to by the
Board of Directors and to be in full force and effect, and delivered to the
Trustee.

               “Business Day” means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in the City of New York are
authorized or obligated by law or regulation to close.

               “Capital Stock” for any corporation means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of
or interests in (however designated) stock issued by that corporation.

               “Change of Control’’ shall mean the occurrence of any of the following:

               (a) there is a report filed on Schedule 13D or Schedule TO (or any successor
schedule, form or report) pursuant to the Exchange Act, disclosing that any
Person, including its Affiliates or Associates (for the purposes of Sections
3.1(b) and 3.8 and clause (c) of Section 10.1(b)(vii)(1) (and the defined terms
used therein), including as the term “person” is used in Section 13(d)(3) or
Section 14(d)(2) of the Exchange Act) has become the beneficial owner (as the
term “beneficial owner” is defined under

 

 

Rule 13d-3 or any successor rule or regulation promulgated under the Exchange
Act) of 50% or more of the aggregate voting power of the Common Stock then
outstanding or other Capital Stock into which the Common Stock is reclassified
or changed; provided that a Person shall not be deemed beneficial owner of, or
to own beneficially, (i) any securities tendered pursuant to a tender or
exchange offer made by or on behalf of such Person or any of such Person’s
Affiliates or Associates until such tendered securities are accepted for
purchase or exchange thereunder, or (ii) any securities if such beneficial
ownership (x) arises solely as a result of a revocable proxy delivered in
response to a proxy or consent solicitation made pursuant to the applicable
rules and regulations under the Exchange Act, and (y) is not also then
reportable on Schedule 13D (or any successor schedule) under the Exchange Act;
or

               (b) any share exchange, consolidation or merger is consummated pursuant to
which the Common Stock would be converted into cash, securities or other
property, in each case other than any share exchange, consolidation or merger
in which the holders of Common Stock immediately prior to the share exchange,
consolidation or merger have, directly or indirectly, at least a majority of
the total voting power in the aggregate of all classes of capital stock of the
continuing or surviving corporation immediately after the share exchange,
consolidation or merger;

provided, however, that a Change of Control shall not be deemed to have
occurred if:

          (i) at least 90% of the consideration in the transaction or
transactions (other than cash payments for fractional shares) which would
otherwise constitute a Change of Control consist of shares of common
stock traded or to be traded immediately following such Change of Control
on a national securities exchange or the NASDAQ National Market and, as a
result of the transaction or transactions, the Securities become
convertible into cash and such common stock (and any rights attached
thereto);

          (ii) solely for the purpose of determining whether the right of
Holders to require the Company to repurchase their Securities pursuant to
Section 3.8 has arisen (and not for determining whether the Securities
are convertible pursuant to Section 10.1(b)(vii)(1) or subject to a
redemption right of the Company pursuant to Section 3.1(b)), if the Sale
Price per share of the Common Stock for any five Trading Days, in the
case of a Change of Control under (a) above, within the period of ten
consecutive Trading Days ending immediately after the later of the date
of the occurrence of the Change of Control and the date of the public
announcement of the Change of Control, or in the case of a Change of
Control under (b) above, within the period of ten consecutive Trading
Days ending immediately before the date of the occurrence of the Change
of Control, shall equal or exceed 105% of the amount obtained by dividing
the Accreted Principal Amount of $1,000 original principal amount of the
Securities on such Trading Day by the Conversion Rate in effect on such
Trading Day; or

          (iii) by virtue of the Company, any Subsidiary, any employee stock
ownership plan or any other employee benefit plan of the Company or any
Subsidiary, or any Person holding Common Stock for or pursuant to the
terms of any such employee benefit plan, filing or becoming obligated to
file a report under or in response to Schedule 13D or Schedule TO (or any
successor schedule, form or report) under the Exchange Act disclosing
beneficial ownership by it of shares of Common Stock, whether in excess
of 50% or otherwise.

               “Common Stock” shall mean shares of the Company’s common stock, no par
value per share, or any other shares of Capital Stock of the Company into which
such common stock shall be reclassified or changed.

2

 

               “Company” means the party named as the “Company” in the first paragraph of
this Indenture until a successor replaces it pursuant to the applicable
provisions of this Indenture and, thereafter, shall mean such successor. The
foregoing sentence shall likewise apply to any subsequent successor or
successors.

               “Company Request” or “Company Order” means a written request or order
signed in the name of the Company by any two Officers.

               “Consideration Per Share” means for each Security:

          (i) if the last day of the Conversion Period is on or before the
Trading Day immediately preceding the effective date of a Change of
Control or Merger Transaction (whether or not a Change of Control or
Merger Transaction is anticipated), the Volume Weighted Average Price; or

          (ii) if the Conversion Period includes Trading Days that occur both
prior to and on or after the effective date of a Change of Control or
Merger Transaction, (x) for each Trading Day in the Conversion Period
occurring prior to the effective date of such transaction, the Volume
Weighted Average Price or (y) for each Trading Day on or after the
effective date of such transaction, the value on the day of determination
of the same kind, amount and proportion of consideration per share of
Common Stock received by the holders of Common Stock in connection with
such Change of Control or Merger Transaction; or

          (iii) if the Conversion Period commences on or after the effective
date of a Change of Control or Merger Transaction, the value on the day
of determination of the same kind, amount and proportion of consideration
per share of Common Stock received by the holders of Common Stock in
connection with such Change of Control or Merger Transaction.

               Solely for purposes of valuing any non-cash consideration received by
Holders of Common Stock in any Change of Control, or in any Merger Transaction,
the value of such non-cash consideration will be its Volume Weighted Average
Price on such day of determination and, to the extent any component of such
non-cash consideration cannot be determined by reference to its Volume Weighted
Average Price, the value of such non-cash consideration on such date of
determination will be determined by the Board of Directors’ reasonable, good
faith determination of such value.

               “Contingent Interest” shall have the meaning set forth in paragraph 1 of
the Securities.

               “Conversion Date” means, with respect to any Securities, the first
Business Day on which the Holder of such Securities has satisfied all the
requirements to convert such Securities if all requirements for conversion
shall have been satisfied by 11:00 a.m. (New York City time) on such Business
Day and, if such requirements for conversion shall have been satisfied after
11:00 a.m. (New York City time) on such Business Day, the next succeeding
Business Day.

               “Conversion Make-Whole Premium” has the meaning determined pursuant to
Section 10.14.

               “Conversion Rate” means, at any time, an amount equal to:

          (i) if the Securities are converted prior to March 6, 2007, the
Accreted Principal Amount of the Securities on the date of determination
divided by the Conversion Price then in effect; or

3

 

          (ii) if the Securities are converted on or after March 6, 2007,
$1,100.00 (the Accreted Principal Amount of the Securities on March 6,
2007) divided by the Conversion Price then in effect; or

          (iii) notwithstanding the foregoing, if the Securities are
convertible solely as a result of a Special Conversion Event, $990.00
divided by the Conversion Price then in effect.

               “Corporate Trust Office” means the principal corporate trust office of the
Trustee in Chicago, Illinois, which office at the date hereof is located at 2
North La Salle Street, Suite 1020, Chicago, Illinois 60602, Attention:
Corporate Trust Department, or such other address as the Trustee may designate
from time to time by notice to the Holders and the Company, or the principal
corporate trust office of any successor Trustee (or such other address as a
successor Trustee may designate from time to time by notice to the Holders and
the Company).

               “Debt” means, with respect to any Person, whether recourse is to all or a
portion of the assets of such Person and whether or not contingent, (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers’ acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; and (vi) every
obligation of the type referred to in clauses (i) through (v) of another Person
and all dividends of another Person the payment of which, in either case, such
Person has guaranteed or is responsible or liable for, directly or indirectly,
as obligor or otherwise.

               “Default” means any event which is, or after notice or passage of time or
both would be, an Event of Default.

               “Exchange Act” means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder, as in effect from time to
time.

               “Ex-Dividend Time” means, with respect to any issuance or distribution on
shares of Common Stock, the first date on which the shares of Common Stock
trade regular way on the principal securities market on which the shares of
Common Stock are then traded without the right to receive such issuances or
distribution.

               “Existing Securities” means any of the Company’s Optionally Convertible
Equity-Linked Accreting Notes (OCEANsSM) due March 6, 2032 issued under an
indenture dated as of March 6, 2002 by and among the Company and the Trustee.

               “Global Securities” means Securities that are in the form of the
Securities attached hereto as Exhibit A.

               “Holder” means a Person in whose name a security is registered on the
Registrar’s books.

               “Indenture” means this Indenture, as amended or supplemented from time to
time in accordance with the terms hereof, including the provisions of the TIA
that are deemed to be a part hereof.

               “Initial Stock Price” means $34.18; provided that, upon the occurrence of
any event which results in an adjustment of the Conversion Price pursuant to
Section 10.4, the Initial Stock Price

4

 

shall be adjusted by multiplying it by a fraction, the numerator of which
shall be equal to the adjusted Conversion Price and the denominator of which
shall be the Conversion Price in effect immediately prior to such adjustment.

               “Interest Payment Date” means March 6 and September 6 of each year,
commencing March 6, 2005.

               “Interest Record Date” means each February 20 and August 23 preceding an
Interest Payment Date.

               “Legend” means the legend labeled as such and that is set forth in Exhibit
A hereto.

               “Officer” means the Chairman of the Board of Directors, the Chief
Executive Officer, the President, any Executive Vice President, any Senior Vice
President, any Vice President, the Chief Financial Officer, the Treasurer or
the Secretary, or any Assistant Treasurer or Assistant Secretary of the
Company.

               “Officers’ Certificate” means a written certificate containing the
information specified in Sections 12.4 and 12.5, signed in the name of the
Company by any two Officers, and delivered to the Trustee. An Officers’
Certificate given pursuant to Section 4.2 shall be signed by the principal
executive officer, principal financial officer or principal accounting officer
of the Company but need not contain the information specified in Sections 12.4
and 12.5.

               “Opinion of Counsel” means a written opinion containing the information
specified in Sections 12.4 and 12.5, from legal counsel. The counsel may be an
employee of, or counsel to, the Company.

               “Person” means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization, or government or any agency or political
subdivision thereof and, for the purposes of Sections 3.1(b) and 3.8 and clause
(c) of Section 10.1(b)(vii)(1) (and the defined terms used therein), shall
include any syndicate or group which would be deemed a “person” under Section
13(d)(3) or Section 14(d)(2) of the Exchange Act as in effect on the date of
this Indenture.

               “Quarterly Contingent Interest Payment Date” means, March 6, June 6,
September 6 and December 6 of each year.

               “Quarterly Contingent Interest Record Date” means each February 20, May
23, August 23 and November 22 preceding a Quarterly Contingent Interest Payment
Date.

               “Redemption Price” shall mean the aggregate price paid by the Company, as
specified in this Indenture, to the Holders in connection with a redemption of
Securities on the applicable Redemption Date.

               “Redemption Date” shall mean any date specified for redemption of the
Securities in accordance with the terms of the Securities and this Indenture.

               “Regular Cash Dividends” means any regular, fixed, annual, quarterly or
other periodic cash dividends as declared by the Board of Directors as part of
the Company’s dividend payment practice or stated cash dividend policy, whether
publicly announced or not, and do not include any other dividends

5

 

or distributions (such as any dividends designated by the Board of
Directors as extraordinary, special or otherwise nonrecurring).

               “Responsible Officer” shall mean, when used with respect to the Trustee,
any officer within the corporate trust department of the Trustee, including any
vice president, assistant vice president, assistant treasurer, trust officer or
any other officer of the Trustee who customarily performs functions similar to
those performed by the Persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of such
Person’s knowledge of and familiarity with the particular subject and who shall
have direct responsibility for the administration of this Indenture.

               “Rule 144A” means Rule 144A under the Securities Act (or any successor
provision), as it may be amended from time to time.

               “Sale Price” of a security on any date of determination means:

               (a) the closing sale price (or, if no closing sale price is reported, the
last reported sale price) of that security (regular way) on the New York Stock
Exchange on that date;

               (b) if that security is not listed on the New York Stock Exchange on that
date, the closing sale price as reported in the composite transactions for the
principal U.S. securities exchange on which that security is listed;

               (c) if that security is not so listed on a U.S. national or regional
securities exchange, the closing sale price as reported by the Nasdaq National
Market;

               (d) if that security is not so reported, the last price quoted by
Interactive Data Corporation for that security or, if Interactive Data
Corporation is not quoting such price, a similar quotation service selected by
the Company; or

               (e) if that security is not so quoted, the average of the mid-point of the
last bid and ask prices for that security from at least two dealers recognized
as market-makers for that security.

               “SEC” means the Securities and Exchange Commission.

               “Securities” means any of the Company’s Optionally Convertible
Equity-Linked Accreting Notes (OCEANsSM) due March 6, 2032 issued under this
Indenture.

               “Securities Act” means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder, as in effect from time to time.

               “Senior Debt” means the principal of and premium (if any) and interest,
including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company (whether or not such
claim for post-petition interest is allowed in such proceeding), on Debt of the
Company, whether incurred on or prior to the date of this Indenture or
thereafter incurred, excluding the Existing Securities, unless, in the
instrument creating or evidencing the same or pursuant to which the same is
outstanding, it is provided that such obligations are not superior in right of
payment to the Securities or to other Debt which is pari passu with, or
subordinated to, the Securities; provided, however, that Senior Debt shall not
be deemed to include (a) any Debt of the Company which, when incurred and
without respect to any election under Section 1111(b) of the Bankruptcy Reform
Act of 1978, as amended, was without recourse to the Company, (b) any Debt of
the Company to any of its Subsidiaries, (c) Debt to any employee of the
Company, (d) trade accounts payable of the Company, (e) accrued

6

 

liabilities arising in the ordinary course of business of the Company, and
(f) the Junior Subordinated Debentures due February 1, 2027, and guarantee
issued by the Company in connection with the 8.85% Capital Securities, Series A
issued by AmerUs Capital I.

               “Stated Interest” shall have the meaning set forth in paragraph 1 of the
Securities.

               “Stated Maturity” means March 6, 2032.

               “Subsidiary” means a corporation more than 50% of the outstanding Voting
Stock of which is owned, directly or indirectly, by the Company or by one or
more other Subsidiaries.

               “TIA” means the Trust Indenture Act of 1939 as in effect on the date of
this Indenture, provided, however, that in the event the TIA is amended after
such date, TIA means, to the extent required by any such amendment, the TIA as
so amended.

               “Trading Day” means any day on which the securities exchange or quotation
system which is used to determine the Sale Price of the applicable security is
open for trading or quotation, or if the applicable security is not so listed
or quoted, any Business Day.

               “Treasury Make-Whole Premium,” with respect to any Security on any date of
redemption, means the present value at such date of redemption of all remaining
Stated Interest payments due on such Security through March 6, 2007, computed
using a discount rate equal to the Treasury Rate exclusive of interest accrued
and unpaid up to but not including such date of redemption (or, if such date of
redemption occurs after any Interest Record Date but prior to the corresponding
Interest Payment Date, exclusive of interest accrued and unpaid up to but not
including that Interest Payment Date).

               “Treasury Rate” means the yield to maturity at the time of computation of
United States Treasury securities with a constant maturity (as compiled and
published in the most recent Federal Reserve Statistical Release H.15 (519)
which has become publicly available at least two Business Days prior to the
date fixed for redemption (or, if such Statistical Release is no longer
published, any publicly available source for similar market data)) most nearly
equal to the then remaining term to March 6, 2007, provided, however, that if
the then remaining term to March 6, 2007 is not equal to the constant maturity
of a United States Treasury security for which a weekly average yield is given,
the Treasury Rate shall be obtained by linear interpolation (calculated to the
nearest one-twelfth of a year) from the weekly average yields of United States
Treasury securities for which such yields are given, except that if the then
remaining term to March 6, 2007 is less than one year, the weekly average yield
on actually traded United States Treasury securities adjusted to a constant
maturity of one year shall be used.

               “Trustee” means the party named as the “Trustee” in the first paragraph of
this Indenture until a successor replaces it pursuant to the applicable
provisions of this Indenture and, thereafter, shall mean such successor. The
foregoing sentence shall likewise apply to any subsequent such successor or
successors.

               “Volume Weighted Average Price” means, per share of Common Stock (or per
share of any security into which the Common Stock has been converted) on any
Trading Day, the volume weighted average price on the principal exchange or
over-the-counter market on which the Common Stock is then listed or traded,
from 9:30 a.m. to 4:00 p.m. (New York City time) on such Trading Day as
displayed under the heading “Bloomberg VWAP” on Bloomberg Page AMH <Equity
AQR> (or the Bloomberg Page for any security into which the Common Stock has
been converted), or if such volume weighted average price is not available, a
reasonable, good faith estimate by the Board of Directors of the

7

 

volume weighted average price of the shares of Common Stock (or securities
into which the Common Stock has been converted) on such Trading Day.

               “Voting Stock” of a Person means Capital Stock of such Person of the class
or classes pursuant to which the holders thereof have the general voting power
under ordinary circumstances to elect the board of directors, managers or
trustees of such Person (irrespective of whether or not at the time Capital
Stock of any other class or classes shall have or might have voting power by
reason of the happening of any contingency).

               Section 1.2 Other Definitions.

	 	 	 	 	 
	 	 	Defined in
	Term:
	 	Section:

	“Act”
	 	 	1.5	(a)
	“Agent Members”
	 	 	2.12	(e)
	“Bid Solicitation Agent”
	 	 	2.3	 
	“Change of Control Purchase Notice”
	 	 	3.8	(b)
	“Change of Control Purchase Price”
	 	 	3.8	(a)
	“Company Notice”
	 	 	3.8	(b)
	“Conversion Agent”
	 	 	2.3	 
	“Conversion Obligation”
	 	 	10.3	(a)
	“Conversion Period”
	 	 	10.3	(a)
	“Conversion Price”
	 	 	10.4	 
	“Current Market Price”
	 	 	10.4	(g)
	“Daily Conversion Value”
	 	 	10.3	(a)
	“Daily Net Share Settlement Value”
	 	 	10.3	(a)
	“Deferred Interest”
	 	 	2.14	 
	“Depositary”
	 	 	2.1	(a)
	“distributed assets”
	 	 	10.4	(d)
	“DTC”
	 	 	2.1	(a)
	“Event of Default”
	 	 	6.1	 
	“Exchange Party”
	 	 	10.2	(f)
	“Expiration Time”
	 	 	10.4	(f)
	“Fair Market Value”
	 	 	10.4	(g)
	“Interest Deferral Period”
	 	 	2.14	 
	“junior securities”
	 	 	11.15	 
	“Legal Holiday”
	 	 	12.8	 
	“Measurement Period”
	 	10.1(b)(iv)
	“Merger Transaction”
	 	 	10.5	 
	“Minimum Amount”
	 	10.1(b)(iv)
	“Non-Electing Share”
	 	 	10.5	 
	“Notice of Default”
	 	 	6.1	(c)
	“Paying Agent”
	 	 	2.3	 
	“Post-Distribution Price”
	 	 	10.4	(d)
	“Public Acquirer Change of Control”
	 	 	10.3	(d)
	“Public Acquirer Change of Control Notice”
	 	 	10.3	(d)
	“Public Acquirer Common Stock”
	 	 	10.3	(d)
	“Purchased Shares”
	 	 	10.4	(f)
	“Proceeding”
	 	 	11.2	 
	“Reference Period”
	 	 	10.4	(d)

8

 

	 	 	 	 	 
	 	 	Defined in
	Term:
	 	Section:

	“Register”
	 	 	2.3	 
	“Registrar”
	 	 	2.3	 
	“Record Date”
	 	 	10.4	(g)
	“Repurchase Date”
	 	 	3.8	(a)
	“Request”
	 	10.1(b)(iv)
	“Rights Plan”
	 	 	10.4	(d)
	“Special Conversion Event”
	 	10.1(b)(iv)
	“Stock Price”
	 	 	10.14	 
	“Surviving Person”
	 	 	5.1	(a)
	“Tax Event”
	 	 	3.1	(c)
	“Tax Event Conversion Value”
	 	 	3.1	(c)
	“transfer”
	 	 	2.12	(d)
	“Trigger Event”
	 	 	10.4	(e)

               Section 1.3 Incorporation by Reference of Trust Indenture Act. Whenever
this Indenture refers to a provision of the TIA, the provision is incorporated
by reference in and made a part of this Indenture. The following TIA terms used
in this Indenture have the following meanings:

               “Commission” means the SEC.

               “indenture securities” means the Securities.

               “indenture security holder” means a Holder.

               “indenture to be qualified” means this Indenture.

               “indenture trustee” or “institutional trustee” means the Trustee.

               “obligor” on the Securities means the Company.

               All other TIA terms used in this Indenture that are defined by the TIA,
defined by a TIA reference to another statute or defined by an SEC rule have
the meanings assigned to them by such definitions.

               Section 1.4 Rules of Construction. Unless the context otherwise requires:

                    (1) a term has the meaning assigned to it;

                    (2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles in the United States as in effect from time to time;

                    (3) “or” is not exclusive;

                    (4) “including” means including, without limitation; and

                    (5) words in the singular include the plural, and words in the
plural include the singular.

               Section 1.5
Acts of Holders. Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture
to be given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such

9

 

Holders in Person or by agent duly appointed in writing; and, except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee and, where it is
hereby expressly required, to the Company. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes
referred to as the “Act” of Holders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing appointing any such
agent shall be sufficient for any purpose of this Indenture and conclusive in
favor of the Trustee and the Company, if made in the manner provided in this
Section.

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

               (c) The ownership of Securities shall be proved by the Register.

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

               (e) If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company
may, at its option, by or pursuant to a Board Resolution, fix in advance a
record date for the determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other Act, but the
Company shall have no obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent, waiver or other Act
may be given before or after such record date, but only the Holders of record
at the close of business on such record date shall be deemed to be Holders for
the purposes of determining whether Holders of the requisite proportion of
outstanding Securities have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other Act, and for
that purpose the outstanding Securities shall be computed as of such record
date; provided that no such authorization, agreement or consent by the Holders
on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after
the record date.

ARTICLE 2

THE SECURITIES

               Section 2.1 Form and Dating. The Securities and the Trustee’s certificate
of authentication shall be substantially in the forms set forth in Exhibit A,
which is incorporated and made part of this Indenture. The Securities shall be
issued only in registered form without coupons and only in $1,000 original
principal amount or integral multiples thereof with principal amount at
maturity of $1,270 per $1,000 original principal amount thereof. The Securities
may have notations, legends or endorsements required by law, stock exchange
rule or usage. The Company shall provide any such notations, legends or
endorsements to the Trustee in writing. Each Security shall be dated the date
of its authentication. The

10

 

Securities are being offered by the Company in exchange for an equal
Accreted Principal Amount of Existing Securities tendered in exchange therefore
by the holders thereof.

               (a) Global Security. Each Security issued in exchange for an Existing
Security which at the time of exchange bears CUSIP Number 03072MAE8 or
03072MAF5 shall be issued initially in the form of a Global Security, which
shall be deposited on behalf of the acquirers of the Securities represented
thereby with the Trustee, at its Corporate Trust Office, as custodian for the
depositary, The Depository Trust Company (“DTC”) (such depositary, or any
successor thereto, being hereinafter referred to as the “Depositary”), and
registered in the name of its nominee, Cede & Co., duly executed by the Company
and authenticated by the Trustee as hereinafter provided. The aggregate
principal amount of the Global Security may from time to time be increased or
decreased by adjustments made on the records of the Trustee and the Depositary
as hereinafter provided subject in each case to compliance with the applicable
rules and procedures of the Depositary.

               (b) Global Securities in General. Each Global Security shall represent
such of the outstanding Securities as shall be specified therein, and each
shall provide that it shall represent the aggregate original principal amount
of outstanding Securities from time to time endorsed thereon and that the
aggregate original principal amount of outstanding Securities represented
thereby may from time to time be reduced or increased, as appropriate, to
reflect exchanges, redemptions, purchases or conversions of such Securities.

               Any adjustment of the aggregate original principal amount of a Global
Security to reflect the amount of any increase or decrease in the amount of
outstanding Securities represented thereby shall be made by the Trustee in
accordance with instructions given by the Holder thereof as required by Section
2.6(a) and shall be made on the records of the Trustee and the Depositary.

               (c) Book-Entry Provisions. The Company shall execute and the Trustee
shall, in accordance with this Section 2.1(c) and Section 2.2, authenticate and
deliver initially one or more Global Securities that (i) shall be registered in
the name of Cede & Co. or as otherwise instructed by the Depositary, (ii) shall
be delivered by the Trustee to the Depositary or pursuant to the Depositary’s
instructions and (iii) shall bear legends substantially to the following
effect:

   “UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO AMERUS GROUP CO. (THE “COMPANY”) OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY
PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN. TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR’S NOMINEE, AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE INDENTURE REFERRED TO ON THE
REVERSE HEREOF.”

11

 

               Section 2.2 Execution and Authentication. The Securities may be executed
on behalf of the Company by any Officer. The signature of such Officer of the
Company on the Securities may be manual or facsimile. Typographic and other
minor errors or defects in any such facsimile signature shall not affect the
validity or enforceability of any Security which has been authenticated and
delivered by the Trustee.

               Securities bearing the manual or facsimile signatures of persons who were,
at the time of the execution of the Securities, proper Officers of the Company
shall bind the Company, notwithstanding that such persons or any of them have
ceased to hold such offices prior to the authentication and delivery of such
Securities or did not hold such offices at the date of authentication of such
Securities by the Trustee.

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

               The Trustee shall authenticate and deliver Securities for original issue
in an aggregate original principal amount of up to $185,000,000 upon a Company
Order without any further action by the Company. The Company Order shall
specify the amount of Securities to be authenticated, shall provide that all
such Securities will be represented by one or more Global Securities and the
date on which each original issue of Securities is to be authenticated. The
aggregate original principal amount of Securities outstanding at any time may
not exceed the amount set forth in the foregoing sentence, except as provided
in Section 2.7.

               Section 2.3 Registrar, Paying Agent, Conversion Agent and Bid Solicitation
Agent. The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange (“Registrar”), an office
or agency where Securities may be presented for purchase or payment (“Paying
Agent”) and an office or agency where Securities may be presented for
conversion (“Conversion Agent”) and one or more offices or agencies where
notices and demands to or upon the Company in respect of the Securities and
this Indenture may be served. The Company shall also appoint a bid solicitation
agent (“Bid Solicitation Agent”) to act for the purposes of Article 10. The
Registrar shall keep a register (“Register”) of the Securities and of their
transfer and exchange. The Company may appoint and maintain one or more
co-Registrars, one or more additional Paying Agents and one or more additional
Conversion Agents to act with respect to this Indenture and the Securities;
provided that (i) the term “Paying Agent” used herein shall include any such
additional Paying Agent, including any named pursuant to Section 4.4, (ii) the
term “Conversion Agent” used herein shall include any such additional
Conversion Agent, including any named pursuant to Section 4.4, and (iii) the
term “Registrar” used herein shall include all such co-Registrars.

               The Company shall enter into an appropriate agency agreement with any
Person (other than the Trustee) appointed as Registrar, Paying Agent,
Conversion Agent or Bid Solicitation Agent in accordance with the foregoing
paragraph. The agreement shall implement the provisions of this Indenture that
relate to such agency. The Company shall notify the Trustee of the name and
address of all such agents, except where the Trustee is acting as such pursuant
to this Section 2.3. If the Company fails to maintain a Registrar, Paying
Agent, Conversion Agent or Bid Solicitation Agent, the Trustee shall act as
such and shall be entitled to appropriate compensation therefor pursuant to
Section 7.7. The Company or any Subsidiary or an Affiliate of either of them
may act as Paying Agent, Registrar, Conversion Agent or Bid Solicitation Agent.

12

 

               The Company initially appoints the Trustee as Registrar, Conversion Agent,
Paying Agent and Bid Solicitation Agent in connection with the Securities.

               Section 2.4 Paying Agent to Hold Money in Trust. Prior to 11:00 a.m., New
York City time, on each due date of payments on any Securities, the Company
shall deposit with the Paying Agent a sum of money (in immediately available
funds if deposited on such due date) and any other consideration sufficient to
make such payments when so becoming due. The Company shall require each Paying
Agent (other than the Trustee) to agree in writing that the Paying Agent shall
hold in trust for the benefit of Holders or the Trustee, as the case may be,
all money and any other consideration held by the Paying Agent for the making
of payments with respect to the Securities and shall notify the Trustee of any
default by the Company in making any such payment. At any time during the
continuance of any such default, the Paying Agent shall, upon the written
request of the Trustee, forthwith pay to the Trustee all money and any other
consideration held by it in trust. If the Company, a Subsidiary or an Affiliate
of either of them acts as Paying Agent, it shall, before 11:00 a.m., New York
City time, on each due date of payments on any Securities, segregate the money
and any other consideration held by it as Paying Agent and hold it in a
separate trust fund. The Company may at any time, and the Trustee may at any
time during the continuance of any Default, upon written request to a Paying
Agent, require a Paying Agent to pay all money and any other consideration held
by it to the Trustee and to account for any funds and any other consideration
disbursed by such Paying Agent. Upon doing so, the Paying Agent shall have no
further liability for such money or other such consideration.

               Section 2.5 Holder Lists. The Trustee shall preserve in as current a form
as is reasonably practicable the most recent list available to it of the names
and addresses of Holders. If the Trustee is not the Registrar, the Company
shall cause to be furnished to the Trustee not later than one Business Day
prior to each Interest Payment Date and, if any Contingent Interest is payable
on a Quarterly Contingent Interest Payment Date that is not an Interest Payment
Date, not later than one Business Day prior to such Quarterly Contingent
Interest Payment Date and at such other times as the Trustee may reasonably
request in writing, the names and addresses of Holders as they appear in the
Register, and the aggregate original principal amount represented by Securities
held by each Holder, as of the preceding Interest Record Date or Quarterly
Contingent Interest Record Date, as the case may be, and such other dates as
reasonably requested by the Trustee.

               Section 2.6 Transfer and Exchange. Subject to Section 2.12, upon surrender
for registration of transfer of any Security at a Registrar, together with an
assignment form in the form included in Exhibit A, in form satisfactory to the

Registrar duly executed by the Holder thereof or its attorney duly authorized
in writing, the Company shall execute and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of any authorized denomination or denominations, representing a
like aggregate principal amount. The Company shall not charge a service charge
for any registration of transfer or exchange, but the Company may require
payment of a sum sufficient to pay all taxes, assessments or other governmental
charges that may be imposed in connection with the transfer or exchange of the
Securities from the Holder requesting such transfer or exchange; provided that
this sentence shall not apply to any exchange pursuant to Sections 2.6(e), 2.9,
3.6, 3.11, 9.5 or 10.2(e).

               (a) Subject to Section 2.12, at the option of the Holder, Securities may
be exchanged for other Securities of any authorized denomination or
denominations, representing a like aggregate principal amount, upon surrender
of the Securities to be exchanged, together with a written instrument of
transfer in form satisfactory to the Registrar duly executed by the Holder or
its attorney duly authorized in writing, at such office or agency. Whenever any
Securities are so surrendered for exchange, the Company shall

13

 

execute and the Trustee shall authenticate and deliver, the Securities
that the Holder making the exchange is entitled to receive.

               The Company shall not be required to make, and the Registrar need not
register, transfers or exchanges of (i) any Securities or portions thereof
selected or called for redemption (except, in the case of Securities to be
redeemed in part, the portion thereof not to be redeemed), (ii) any Securities
or portions thereof in respect of which a Change of Control Purchase Notice has
been delivered and not withdrawn by the Holder thereof (except, in the case of
Securities to be purchased in part, the portion thereof not to be purchased),
or (iii) any Securities for a period of 15 days before any mailing of a notice
of Securities to be redeemed.

               All Securities issued upon any transfer or exchange of Securities shall be
valid obligations of the Company, evidencing the same debt and entitled to the
same benefits under this Indenture, as the Securities surrendered upon such
transfer or exchange. Each Holder of a Security agrees to indemnify the Company
and the Trustee against any liability that may result from the transfer,
exchange or assignment of such Holder’s Security in violation of any provision
of this Indenture and/or applicable United States federal or state securities
law.

               (b) Notwithstanding any provision to the contrary herein, so long as a
Global Security remains outstanding and is held by or on behalf of the
Depositary, transfers of a Global Security, in whole or in part, shall be made
only in accordance with Section 2.12 and this Section 2.6. Transfers of a
Global Security shall be limited to transfers of such Global Security in whole,
or in part, to nominees of the Depositary or to a successor of the Depositary
or such successor’s nominee.

               (c) Successive registrations and registrations of transfers and exchanges
as aforesaid may be made from time to time as desired, and each such
registration shall be noted on the Register.

               (d) Any Registrar appointed pursuant to Section 2.3 shall provide to the
Trustee such information as the Trustee may reasonably require in connection
with the delivery by such Registrar of Securities upon transfer or exchange of
Securities.

               (e) If Securities are issued upon the transfer, exchange or replacement of
Securities subject to restrictions on transfer and bearing the Legend, or if a
request is made to remove the Legend on a Security, the Securities so issued
shall bear the Legend, or the Legend shall not be removed, as the case may be,
unless there is delivered to the Company and the Registrar such satisfactory
evidence, which shall include an Opinion of Counsel, as may be reasonably
required by the Company and the Registrar, that neither the Legend nor the
restrictions on transfer set forth therein are required to ensure that
transfers thereof comply with the provisions of the Securities Act or that such
Securities are not “restricted” within the meaning of Rule 144 under the
Securities Act; provided that no such evidence need be supplied in connection
with the sale of such Security pursuant to a registration statement that is
effective at the time of such sale. Upon (i) provision of such satisfactory
evidence, or (ii) notification by the Company to the Trustee and Registrar of
the sale of such Security pursuant to a registration statement that is
effective at the time of such sale, the Trustee, at the written direction of
the Company, shall authenticate and deliver a Security that does not bear the
Legend. If the Legend is removed from the face of a Security and the Security
is subsequently held by an Affiliate of the Company, the Legend shall be
reinstated.

               (f) The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Security (including any transfers between or among Depositary
participants or beneficial owners of interests in any Global Security) other
than to require delivery of such certificates and other documentation or
evidence as are expressly required by, and to do

14

 

so if and when expressly required by the terms of, this Indenture, and to
examine the same to determine substantial compliance as to form with the
express requirements hereof.

               Section 2.7 Replacement Securities. If (a) any mutilated Security is
surrendered to the Trustee, or (b) the Company and the Trustee receive evidence
to their satisfaction of the destruction, loss or theft of any Security, and
there is delivered to the Company and the Trustee such security or indemnity as
may be required by them to save each of them harmless, then, in the absence of
notice to the Company or the Trustee that such Security has been acquired by a
bona fide purchaser, the Company shall execute and, upon the Company’s written
request, the Trustee shall authenticate and deliver, in exchange for any such
mutilated Security or in lieu of any such destroyed, lost or stolen Security, a
new Security of like tenor and principal amount, bearing a number not
contemporaneously outstanding.

               In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, or is about to be purchased by the
Company pursuant to Article 3, the Company in its discretion (but subject to
any conversion rights) may, instead of issuing a new Security, pay or purchase
such Security, as the case may be.

               Upon the issuance of any new Securities under this Section 2.7, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.

               Every new Security issued pursuant to this Section 2.7 in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and shall
be entitled to all benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.

               The provisions of this Section 2.7 are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Securities.

               Section 2.8 Outstanding Securities; Determinations of Holders’ Action.
Securities outstanding at any time are all the Securities authenticated by the
Trustee except for those cancelled by it, those paid pursuant to Section 2.7
and those described in this Section 2.8 as not outstanding. A Security does not
cease to be outstanding because the Company or an Affiliate thereof holds the
Security; provided, however, that in determining whether the Holders of the
requisite original principal amount of Securities have given or concurred in
any request, demand, authorization, direction, notice, consent or waiver
hereunder, Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company or such other obligor shall be
disregarded and deemed not to be outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Securities
which a Responsible Officer of the Trustee actually knows to be so owned shall
be so disregarded. Securities so owned which have been pledged in good faith
shall not be disregarded if the pledgee establishes to the satisfaction of the
Trustee the pledgee’s right so to act with respect to the Securities and that
the pledgee is not the Company or any other obligor on the Securities or any
Affiliate of the Company or of such other obligor. Subject to the foregoing,
only Securities outstanding at the time of such determination shall be
considered in any such determination (including, without limitation,
determinations pursuant to Articles 6 and 9).

15

 

               If a Security is replaced pursuant to Section 2.7, it ceases to be
outstanding unless each of the Company and the Trustee receives proof
satisfactory to it that the replaced Security is held by a bona fide purchaser.

               If the Paying Agent holds, in accordance with this Indenture, on a
Redemption Date, or on the Business Day following a Repurchase Date, or on
Stated Maturity, money and any other consideration required by this Indenture
sufficient to pay amounts owed with respect to Securities payable on that date,
then immediately after such Redemption Date, Repurchase Date or Stated
Maturity, as the case may be, such Securities shall cease to be outstanding and
interest, if any, on such Securities shall cease to accrue; provided that, if
such Securities are to be redeemed, notice of such redemption has been duly
given pursuant to this Indenture or provision therefor satisfactory to the
Trustee has been made.

               If a Security is converted in accordance with Section 10.1, then as of the
Conversion Date, such Security shall cease to be outstanding and interest, if
any, shall cease to accrue on such Security as of such date.

               Section 2.9 Temporary Securities. Pending the preparation of definitive
Securities, the Company may execute and, upon Company Order, the Trustee shall
authenticate and deliver, temporary Securities that are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Securities in lieu
of which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities
may determine, as conclusively evidenced by their execution of such Securities.

               If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at the office
or agency of the Company designated for such purpose pursuant to Section 2.3,
without charge to the Holder. Upon surrender for cancellation of any one or
more temporary Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor definitive Securities of
authorized denominations representing a like principal amount. Until so
exchanged, the temporary Securities shall in all respects be entitled to the
same benefits under this Indenture as definitive Securities.

               Section 2.10 Cancellation. All Securities surrendered for payment,
purchase by the Company pursuant to Article 3, conversion (except Securities
exchanged pursuant to Section 10.2(f)), redemption or registration of transfer
or exchange shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee and shall be promptly cancelled by it. The Company may
at any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder that the Company may have acquired in any
manner whatsoever, and all Securities so delivered shall be promptly cancelled
by the Trustee. The Company may not issue new Securities to replace Securities
it has paid or delivered to the Trustee for cancellation or that any Holder has
converted pursuant to Article 10. No Securities shall be authenticated in lieu
of or in exchange for any Securities cancelled as provided in this Section,
except as expressly permitted by this Indenture. All cancelled Securities held
by the Trustee shall be disposed of by the Trustee in accordance with the
Trustee’s customary procedure.

               Section 2.11 Persons Deemed Owners. Prior to due presentment of a Security
for registration of transfer, the Company, the Trustee and any agent of the
Company or the Trustee may treat the Person in whose name such Security is
registered as the owner of such Security for the purpose of receiving payment
of the principal amount of the Security, any Redemption Price or Change of
Control Purchase Price in respect thereof, any premium (including any Treasury
Make-Whole Premium or Conversion Make-Whole Premium) or any accrued interest
(including Stated Interest, Contingent Interest

16

 

and Deferred Interest) thereon, for the purpose of conversion and for all
other purposes whatsoever, whether or not such Security is overdue, and none of
the Company, the Trustee and any of their respective agents shall be affected
by notice to the contrary.

               Section 2.12 Global Securities. A Global Security may not be
transferred, in whole or in part, to any Person other than the Depositary or a
nominee or any successor thereof, and no such transfer to any such other Person
may be registered; provided that the foregoing shall not prohibit any transfer
of a Security that is issued in exchange for a Global Security but is not
itself a Global Security. No transfer of a Security to any Person shall be
effective under this Indenture or the Securities unless and until such Security
has been registered in the name of such Person. Notwithstanding any other
provisions of this Indenture or the Securities, transfers of a Global Security,
in whole or in part, shall be made only in accordance with Section 2.6 and this
Section 2.12.

               (b) Subject to Section 2.12(c), every Security shall be subject to the
applicable restrictions on transfer provided in the Legend, including the
delivery of an Opinion of Counsel. Whenever any Security bearing the
restrictive Legend is presented or surrendered for registration of transfer or
for exchange for a Security registered in a name other than that of the Holder,
such Security must be accompanied by a certificate in substantially the form
set forth in Exhibit B, dated the date of such surrender and signed by the
Holder of such Security, as to compliance with such restrictions on transfer.
The Registrar shall not be required to accept for such registration of transfer
or exchange any Security not so accompanied by a properly completed
certificate.

               (c) The restrictions imposed by the Legend upon the transferability of any
Security shall cease and terminate when such Security has been sold pursuant to
an effective registration statement under the Securities Act or transferred in
compliance with Rule 144 under the Securities Act (or any successor provision
thereto) or, if earlier, upon the expiration of the holding period applicable
to sales thereof under Rule 144(k) under the Securities Act (or any successor
provision). Any Security as to which such restrictions on transfer shall have
expired in accordance with their terms or shall have terminated may, upon a
surrender of such Security for exchange to the Registrar in accordance with the
provisions of this Section 2.12 (accompanied, in the event that such
restrictions on transfer have terminated by reason of a transfer in compliance
with Rule 144 (including Rule 144(k)) or any successor provision, by an opinion
of counsel having substantial experience in practice under the Securities Act
and otherwise reasonably acceptable to the Company, addressed to the Company
and in form acceptable to the Company, to the effect that the transfer of such
Security has been made in compliance with Rule 144 or such successor
provision), be exchanged for a new Security, of like tenor and aggregate
principal amount, which shall not bear the restrictive Legend. The Company
shall inform the Trustee of the effective date of any registration statement
registering the Securities under the Securities Act. The Trustee shall not be
liable for any action taken or omitted to be taken by it in good faith in
accordance with the aforementioned opinion of counsel or registration
statement.

               (d) As used in the preceding two paragraphs of this Section 2.12, the term
“transfer” encompasses any sale, pledge, transfer, hypothecation or other
disposition of any Security.

               (e) The provisions of this Section 2.12(e) shall apply only to Global
Securities:

          (1) Notwithstanding any other provisions of this Indenture or the
Securities, a Global Security shall not be exchanged in whole or in part
for a Security registered in the name of any Person other than the
Depositary or one or more nominees thereof, provided that a Global
Security may be exchanged for Securities registered in the names of any
Person designated by the Depositary in accordance with their interests in
such Securities in the event that (i) the Depositary has notified the
Company that it is unwilling or unable to continue as Depositary for such
Global

17

 

Security or such Depositary has ceased to be a “clearing agency”
registered under the Exchange Act, and a successor Depositary is not
appointed by the Company within 90 days, (ii) the Company has provided
the Depositary with written notice that it has decided to discontinue use
of the system of book-entry transfer through the Depositary or any
successor Depositary or (iii) an Event of Default has occurred and is
continuing with respect to the Securities. Any Global Security exchanged
pursuant to clauses (i) or (ii) above shall be so exchanged in whole and
not in part, and any Global Security exchanged pursuant to clause (iii)
above may be exchanged in whole or from time to time in part as directed
by the Depositary. Any Security issued in exchange for a Global Security
or any portion thereof shall be a Global Security; provided that any such
Security so issued that is registered in the name of a Person other than
the Depositary or a nominee thereof shall not be a Global Security.

          (2) Securities issued in exchange for a Global Security or any
portion thereof shall be issued in definitive, fully registered form,
without interest coupons, shall represent an aggregate principal amount
equal to that of such Global Security or portion thereof to be so
exchanged, shall be registered in such names and be in such authorized
denominations as the Depositary shall designate and shall bear the
applicable legends provided for herein. Any Global Security to be
exchanged in whole shall be surrendered by the Depositary to the Trustee,
as Registrar. With regard to any Global Security to be exchanged in part,
either such Global Security shall be so surrendered for exchange or, if
the Trustee is acting as custodian for the Depositary or its nominee with
respect to such Global Security, the principal amount thereof shall be
reduced, by an amount equal to the portion thereof to be so exchanged, by
means of an appropriate adjustment made on the records of the Trustee.
Upon any such surrender or adjustment, the Trustee shall authenticate and
deliver the Security issuable on such exchange to or upon the order of
the Depositary or an authorized representative thereof.

          (3) Subject to the provisions of clause (5) below, the registered
Holder may grant proxies and otherwise authorize any Person, including
Agent Members (as defined below) and Persons that may hold interests
through Agent Members, to take any action which a Holder is entitled to
take under this Indenture or the Securities.

          (4) In the event of the occurrence of any of the events specified in
clause (1) above, the Company will promptly make available to the Trustee
a reasonable supply of certificated Securities in definitive, fully
registered form, without interest coupons.

          (5) Neither any members of, or participants in, the Depositary
(collectively, the “Agent Members”) nor any other Persons on whose behalf
Agent Members may act shall have any rights under this Indenture with
respect to any Global Security registered in the name of the Depositary
or any nominee thereof, or under any such Global Security, and the
Depositary or such nominee, as the case may be, may be treated by the
Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner and holder of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent
the Company, the Trustee or any agent of the Company or the Trustee from
giving effect to any written certification, proxy or other authorization
furnished by the Depositary or such nominee, as the case may be, or
impair, as between the Depositary, its Agent Members and any other Person
on whose behalf an Agent Member may act, the operation of customary
practices of such Persons governing the exercise of the rights of a
holder of any Security.

               Section 2.13 CUSIP Numbers. The Company may issue the Securities with one
or more “CUSIP” numbers (if then generally in use), and, if so, the Trustee
shall use “CUSIP” numbers in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation

18

 

is made as to the correctness of such numbers either as printed on the
Securities or as contained in any notice of a redemption and that reliance may
be placed only on the other identification numbers printed on the Securities,
and any such redemption shall not be affected by any defect in or omission of
such numbers. The Company will promptly notify the Trustee of any change in the
CUSIP numbers.

               Section 2.14 Deferral of Interest; Notice of Deferral. If no Event of
Default has occurred and is continuing, the Company shall have the right, at
any time during the term of the Securities, from time to time to defer payments
of Stated Interest for a period (an “Interest Deferral Period”) not exceeding
10 consecutive semiannual periods, commencing from the first Interest Payment
Date on which such payment of Stated Interest which would otherwise have been
payable is so deferred. An Interest Deferral Period may not, however, extend
beyond Stated Maturity. To the extent permitted by applicable law, interest on
any deferred payment of Stated Interest will accrue at the rate of 5.00% per
annum, compounded semiannually on each Interest Payment Date and calculated on
the basis of a 360-day year of twelve 30-day months. Upon the termination of
any Interest Deferral Period, the Company shall repay in cash, in whole and not
in part, the aggregate amount of all accrued and unpaid deferred payments of
Stated Interest outstanding at that time plus any accrued and unpaid interest
thereon (“Deferred Interest”) then due. Before the termination of any Interest
Deferral Period, the Company may further extend such period; provided that such
period together with all such further extensions thereof does not exceed 10
consecutive semiannual periods. If any Interest Deferral Period shall terminate
on a day that is not an Interest Payment Date, the Company shall pay in cash
all Deferred Interest due and payable upon such termination to Holders of
record on a record date selected by the Company, which shall be no more than 30
days and no less than 15 days prior to such date of determination.

               (a) Notwithstanding the foregoing, all Deferred Interest outstanding
during an Interest Deferral Period shall become immediately due and payable (i)
upon the Interest Payment Date next following the date of commencement of such
Interest Deferral Period, unless such Interest Deferral Period is further
extended by the Company as permitted by the foregoing paragraph, (ii) upon the
fifth anniversary of the date of commencement of such Interest Deferral Period,
or (iii) with respect to any Security or any portion thereof converted,
repurchased or redeemed during an Interest Deferral Period, upon the
conversion, repurchase or redemption of such Security. Upon the termination of
any Interest Deferral Period and full payment in cash of all accrued and unpaid
Deferred Interest due upon such termination, the Company may commence a new
Interest Deferral Period, subject to the foregoing requirements.

               (b) If the Company elects to commence an Interest Deferral Period with
respect to the Securities, the Company shall give the Trustee notice of the
commencement of such Interest Deferral Period, and prepare and provide a press
release to DTC for dissemination through the DTC broadcast facility, at least
one Business Day before the Interest Record Date for the next following
Interest Payment Date, unless otherwise required by any applicable law or
regulation.

               (c) During an Interest Deferral Period, the Company shall not (i) declare
or pay dividends on, make distributions with respect to, or redeem, purchase or
acquire, or make a liquidation payment with respect to, any of its Capital
Stock (other than stock dividends paid by the Company which consist of stock of
the same class as that on which such dividend is being paid and purchases of
Common Stock related to the issuance of Common Stock under any stock option or
other benefit plan for the directors, officers, employees or agents of the
Company or its Subsidiaries), (ii) make any payment of interest, principal or
premium, if any, on or repay, repurchase or redeem any Debt securities of the
Company that rank pari passu with or junior to the Securities (other than any
payment, repayment,

19

 

repurchase or redemption made on Debt relating to employee stock ownership
plans), nor (iii) make any guarantee payments with respect to the foregoing.

ARTICLE 3

REDEMPTION AND PURCHASES

               Section 3.1 Right to Redeem. Optional Redemption upon Satisfaction of
Market Price Condition. Subject to the rights of Holders set forth in Section
10.1 and the provisions of this Article, the Company may, upon giving such
notice to Holders as provided in Section 3.3, elect to redeem the Securities
outstanding at any time as a whole or, on or after March 6, 2007, in part from
time to time, provided that at least $75,000,000 original principal amount of
Securities remain outstanding immediately after any such partial redemption,
for cash at a Redemption Price equal to 100% of their Accreted Principal Amount
on the Redemption Date plus, accrued and unpaid interest (including Stated
Interest, Contingent Interest and Deferred Interest), if any, thereon up to but
not including the Redemption Date plus, with respect to any Security or any
portion thereof redeemed on a Redemption Date that occurs prior to March 6,
2007, a Treasury Make-Whole Premium, if the Sale Price per share of the Common
Stock for at least 20 Trading Days in the 30 consecutive Trading-Day period
ending on and including the Trading Day before the date on which the notice of
redemption is given pursuant to Section 3.3 exceeds 140% of the Initial Stock
Price.

               (b) Optional Redemption upon a Change of Control. Subject to the rights of
Holders set forth in Section 10.1 and the provisions of this Article, the
Company may, upon giving such notice to Holders as provided in Section 3.3,
elect to redeem the Securities outstanding at any time as a whole but not in
part for cash at a Redemption Price equal to 100% of their Accreted Principal
Amount on the Redemption Date plus (i) accrued and unpaid interest (including
Stated Interest, Contingent Interest and Deferred Interest), if any, thereon up
to but not including the Redemption Date, plus (ii) if such Change of Control
occurs prior to March 6, 2007, the Conversion Make-Whole Premium, if any,
payable in Common Stock (or the same form, and in the same proportion, of
consideration into which Common Stock has been converted in connection with
such Change of Control), determined pursuant to Section 10.14, plus (iii) with
respect to any Security or any portion thereof redeemed on a Redemption Date
that occurs prior to March 6, 2007, a Treasury Make-Whole Premium payable in
cash, if a Change of Control occurs, unless a Public Acquirer Change of Control
occurs and the Company has provided the Public Acquirer Change of Control
Notice specified in Section 10.3(d), in which case the Company may not redeem
Securities pursuant to this Section 3.1(b); provided that the notice of such
redemption to be given to Holders in accordance with Section 3.3 is mailed
within 30 days following the occurrence of such Change of Control.

               (c) Optional Redemption upon a Tax Event. Subject to the rights of Holders
set forth in Section 10.1 and the provisions of this Article, the Company may,
upon giving such notice to Holders as provided in Section 3.3, elect to redeem
the Securities outstanding at any time as a whole but not in part for cash at a
Redemption Price equal to 100% of their Accreted Principal Amount on the
Redemption Date plus, accrued and unpaid interest (including Stated Interest,
Contingent Interest and Deferred Interest), if any, thereon up to but not
including the Redemption Date plus, with respect to any Security or any portion
thereof redeemed on a Redemption Date that occurs prior to March 6, 2007, a
Treasury Make-Whole Premium, if a Tax Event has occurred and the Tax Event
Conversion Value of the Securities on any Trading Day within the five Trading
Days immediately preceding the date on which the notice of such redemption is
given in accordance with Section 3.3 exceeds their Accreted Principal Amount by
at least 10%.

20

 

               A “Tax Event” shall be deemed to have occurred if the Company shall have
received an opinion from independent tax counsel experienced in such matters to
the effect that, on or after December 15, 2004 as a result of (i) any amendment
to, or change (including any announced prospective change) in, the laws (or
rules or regulations thereunder) of the United States or any political
subdivision or taxing authority of, or in, the United States; or (ii) any
amendment to, or change in, an interpretation or application of those laws,
rules or regulations by any legislative body, court, governmental agency or
regulatory authority, in each case which amendment or change is enacted,
promulgated, issued or announced or which interpretation is issued or announced
or which action is taken, on or after December 15, 2004, there is more than an
insubstantial risk (x) that the amount of interest deductible by the Company
for United States federal income tax purposes with respect to the Securities
either (1) would not be based on the treatment of the Securities as contingent
payment debt instruments or (2) would not be calculated using a comparable
yield equal to or greater than 9.917% per annum, or (y) that the Company would
not be entitled to deduct interest on the Securities (in whole or in part) for
any reason.

               “Tax Event Conversion Value” of any Security on any date of determination
is equal to the product of (i) the Sale Price per share for the Common Stock on
such date, multiplied by (ii) the quotient of the Accreted Principal Amount
divided by the Conversion Price.

               Section 3.2 Selection of Securities to Be Redeemed. If less than all the
Securities are to be redeemed, unless the procedures of the Depositary provide
otherwise, the Trustee shall select the Securities to be redeemed on a pro rata
basis. The Trustee shall make the selection at least three days prior to the
date on which the Company proposes to mail notice to Holders in accordance with
Section 3.3.

               The Trustee may select for redemption portions of the original principal
amount of any Securities that have denominations larger than $1,000. Securities
and portions thereof so selected by the Trustee shall be in $1,000 original
principal amount or integral multiples thereof. Provisions of this Indenture
that apply to Securities called for redemption also apply to portions of
Securities called for redemption. The Trustee shall notify the Company promptly
of the Securities or portions of Securities to be redeemed.

               If any Security selected for partial redemption is surrendered for
conversion in part before termination of the conversion right with respect to
the portion of the Security so selected, the converted portion of such Security
shall be deemed (so far as may be), solely for the purpose of determining the
aggregate original principal amount of the Securities to be redeemed by the
Company, to be the portion selected for redemption. Securities that have been
converted during a selection of Securities to be redeemed may be treated by the
Trustee as outstanding for the purpose of such selection.

               Section 3.3 Notice of Redemption.  The Company shall mail a notice of
redemption by first-class mail, postage prepaid, to each Holder of Securities
to be redeemed at least 15 days but not more than 60 days prior to the
Redemption Date.

               (b) The notice shall identify the Securities to be redeemed and shall
state:

          (1) the Redemption Date;

          (2) the Redemption Price, including, in the case of a redemption of
Securities pursuant to Section 3.1(b) hereof, the portion of the
Redemption Price constituting non-cash consideration, if any, and
describing such in reasonable detail;

          (3) the Conversion Price and any adjustments thereto;

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          (4) the name and address of the Paying Agent and Conversion Agent;

          (5) that Securities called for redemption may be converted at any
time before the close of business on the date that is two Business Days
prior to the Redemption Date;

          (6) that Holders who want to convert Securities must satisfy the
requirements set forth in Article 10;

          (7) that Securities called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price therefor;

          (8) if any Security is being redeemed in part, the portion of the
original principal amount of such Security to be redeemed and that, after
the Redemption Date, upon surrender of such Security being redeemed in
part, a new Security or Securities in aggregate principal amount equal to
the unredeemed portion thereof will be issued;

          (9) that, unless the Company defaults in making payment of such
Redemption Price, interest on Securities called for redemption will cease
to accrue on and after the Redemption Date; and

          (10) the CUSIP number of the Securities.

               Section 3.4 Effect of Notice of Redemption. Once notice of redemption is
mailed, Securities called for redemption become due and payable on the
Redemption Date and at the Redemption Price stated in the notice except for
Securities which are converted in accordance with the provisions of Article 10.
Upon surrender to the Paying Agent, Securities called for redemption shall be
paid at the Redemption Price stated in the notice.

               Section 3.5 Deposit of Redemption Price. Prior to 11:00 a.m. (New York
City time) on the Redemption Date, the Company shall deposit with the Paying
Agent (or if the Company or a Subsidiary or an Affiliate of either of them is
the Paying Agent, shall segregate and hold in trust) an amount of money (in
immediately available funds if deposited on such Redemption Date), and, in the
case of a Redemption of Securities pursuant to Section 3.1(b) hereof, such
other non-cash consideration required to be delivered, sufficient to pay the
Redemption Price of all Securities to be redeemed on that date, other than
Securities or portions of Securities called for redemption that on or prior
thereto have been delivered by the Company to the Trustee for cancellation or
have been converted. The Paying Agent shall as promptly as practicable return
to the Company any money (and other non-cash consideration, if any) not
required for that purpose because of conversion of Securities pursuant to
Article 10. If such money is then held by or on behalf of the Company in trust
and is not required for such purpose, it shall be discharged from such trust.

               Section 3.6 Securities Redeemed in Part. Upon surrender of a Security that
is redeemed in part, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder a new Security in an authorized
denomination representing a like principal amount to the unredeemed portion of
the Security surrendered.

               Section 3.7 Notice to Trustee. If the Company elects to redeem Securities
pursuant to Section 3.1, it shall notify the Trustee in writing of the
Redemption Date, the original principal amount of Securities to be redeemed and
the Redemption Price (calculated to the nearest cent or 1/100th of any
security, as the case may be) by a Company Order at least 20 days prior to the
Redemption Date (unless a shorter notice shall be satisfactory to the Trustee),
but in any event no later than two days prior to the date

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on which the Company proposes to mail notice of such redemption to the
Holders pursuant to Section 3.3 above. If any of the Securities to be redeemed
is in the form of a Global Security, then the Company shall modify such notice
to the extent necessary to accord with the procedures of the Depositary
applicable to redemptions. At the Company’s written request, which request
shall (i) be irrevocable once given and (ii) set forth all relevant information
required by Section 3.3, the Trustee shall give the notice of redemption
required pursuant to Section 3.3 to each Holder in the Company’s name and at
the Company’s expense, provided that the Company makes such request at least 10
days prior to the date by which such notice of redemption must be given to
Holders in accordance with Section 3.3.

               Section 3.8 Purchase of Securities at Option of the Holder upon Change of
Control. If a Change of Control occurs, Securities or any portion thereof
that is an integral multiple $1,000 original principal amount shall be
purchased by the Company, at the option of the Holder thereof, at a purchase
price equal to 100% of the Accreted Principal Amount of such Securities as of
the date that is 45 Business Days after the date of the Company Notice given by
the Company in accordance with paragraph (b) below (the “Repurchase Date”),
plus accrued and unpaid interest (including Stated Interest, Contingent
Interest and Deferred Interest), if any, thereon up to but not including the
Repurchase Date, payable in cash, plus, unless a Public Acquirer Change of
Control occurs and the Company provides a Public Acquirer Change of Control
Notice specified in Section 10.3(d), if such Change of Control occurs prior to
March 6, 2007, the Conversion Make-Whole Premium, if any, payable in Common
Stock (or the same form, and in the same proportion, of consideration into
which Common Stock has been converted in connection with such Change of
Control), determined pursuant to Section 10.14, (the “Change of Control
Purchase Price”), subject to satisfaction by or on behalf of the Holder of the
requirements set forth in Section 3.8(c).

               (b) Irrespective of whether Holders have the right to require the Company
to repurchase Securities pursuant to paragraph (a) above, within 30 days after
the occurrence of a Change of Control, the Company shall mail a written notice
of the Change of Control by first-class mail to the Trustee and to each Holder
(and to beneficial owners as required by applicable law). To the extent
relevant, the notice given by the Company (“Company Notice”) shall include a
notice in the form attached hereto as part of Exhibit A to be completed by the
Holder (the “Change of Control Purchase Notice”) and shall state, among other
things, to the extent relevant:

          (1) briefly, the events causing a Change of Control and the date
such Change of Control is deemed to have occurred for purposes of this
Section 3.8;

          (2) the date by which the Change of Control Purchase Notice must be
given by the Holder;

          (3) if Holders may exercise the purchase right pursuant to Section
3.8(a);

          (4) the Repurchase Date;

          (5) the Change of Control Purchase Price (including the portion of
the Change of Control Purchase Price constituting non-cash consideration,
if any, and describing such in reasonable detail);

          (6) the name and address of the Paying Agent and the Conversion
Agent;

          (7) the Conversion Price and any adjustments thereto;

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          (8) that Securities as to which a Change of Control Purchase Notice
has been given may be converted in accordance with Article 10 hereof only
if the Change of Control Purchase Notice has been withdrawn in accordance
with the terms of this Indenture;

          (9) that Securities must be surrendered to the Paying Agent to
collect payment;

          (10) that the Change of Control Purchase Price for any Securities as
to which a Change of Control Purchase Notice has been duly given and not
withdrawn will be paid promptly following the later of the Repurchase
Date and the time of surrender of such Securities as described in (9);

          (11) the procedures the Holder must follow to exercise rights under
this Section 3.8 and a brief description of those rights;

          (12) the procedures for withdrawing a Change of Control Purchase
Notice;

          (13) that, unless the Company defaults in making payment of such
Change of Control Purchase Price, interest on Securities surrendered for
purchase by the Company will cease to accrue on and after the Repurchase
Date; and

          (14) the CUSIP number of the Securities.

               (c) A Holder may exercise its rights specified in Section 3.8(a) upon
delivery of a Change of Control Purchase Notice to the Paying Agent at any time
prior to the close of business on the fifth Business Day prior to the
Repurchase Date, stating:

          (1) the certificate numbers of the Securities that the Holder will
deliver to be purchased;

          (2) the portion of the original principal amount of the Securities
which the Holder will deliver to be purchased, which portion must be in
$1,000 original principal amount or an integral multiple thereof; and

          (3) that such Securities shall be purchased pursuant to the terms
and conditions specified in paragraph 6 of the Securities.

               The delivery of such Securities to the Paying Agent (together with all
necessary endorsements) at the offices of the Paying Agent shall be a condition
to the receipt by the Holder of the Change of Control Purchase Price therefor;
provided, however, that such Change of Control Purchase Price shall be so paid
pursuant to this Section 3.8 only if the Securities so delivered to the Paying
Agent shall conform in all respects to the description thereof set forth in the
related Change of Control Purchase Notice.

               The Company shall purchase from the Holder thereof, pursuant to this
Section 3.8, a portion of a Security if the original principal amount of such
portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to the purchase of all of a Security also apply to the
purchase of such portion of such Security.

               Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.8 shall be consummated by the delivery of the consideration to
be received by the Holder promptly

24

 

following the later of the Repurchase Date and the time of delivery of the
Security to the Paying Agent in accordance with this Section 3.8.

               Notwithstanding anything herein to the contrary, any Holder delivering to
the Paying Agent the Change of Control Purchase Notice contemplated by this
Section 3.8(c) shall have the right to withdraw such Change of Control Purchase
Notice at any time prior to the close of business on the Business Day
immediately preceding the Repurchase Date by delivery of a written notice of
withdrawal to the Paying Agent in accordance with Section 3.9.

               The Paying Agent shall promptly notify the Company of the receipt by it of
any Change of Control Purchase Notice or written withdrawal thereof.

               Section 3.9 Effect of Change of Control Purchase Notice; Withdrawal of
Change of Control Purchase Notice. Upon receipt by the Paying Agent of the
Change of Control Purchase Notice specified in Section 3.8(b), the Holder of
the Securities in respect of which such Change of Control Purchase Notice was
given shall (unless such Change of Control Purchase Notice is withdrawn as
specified below) thereafter be entitled to receive solely the Change of Control
Purchase Price with respect to such Securities. Such Change of Control Purchase
Price shall be paid to such Holder, subject to receipt of funds (and any other
required non-cash consideration) by the Paying Agent, promptly following the
later of (x) the Repurchase Date with respect to such Securities (provided the
conditions in Section 3.8(c) have been satisfied) and (y) the time of delivery
of such Securities to the Paying Agent by the Holder thereof in the manner
required by Section 3.8(c). Securities in respect of which a Change of Control
Purchase Notice has been given by the Holder thereof may not be converted in
accordance with Article 10 on or after the date of the delivery of such Change
of Control Purchase Notice, unless such Change of Control Purchase Notice has
first been validly withdrawn.

               A Change of Control Purchase Notice may be withdrawn by means of a written
notice of withdrawal delivered to the office of the Paying Agent in accordance
with the Change of Control Purchase Notice at any time prior to the close of
business on the Business Day immediately preceding the Repurchase Date
specifying:

          (1) the certificate number, if any, of the Securities in respect of
which such notice of withdrawal is being submitted,

          (2) the original principal amount of the Securities or portion
thereof (which must be an original principal amount of an integral
multiple of $1,000) with respect to which such notice of withdrawal is
being submitted, and

          (3) the original principal amount, if any, of such Securities or
portion thereof (which must be an original principal amount of an
integral multiple of $1,000) which remains subject to the original Change
of Control Purchase Notice and which has been or will be delivered for
purchase by the Company.

               The Paying Agent will promptly return to the respective Holders thereof
any Securities or portion thereof (x) with respect to which a Change of Control
Purchase Notice has been withdrawn in compliance with this Indenture, or (y)
held by it during the continuance of an Event of Default (other than a default
in the payment of the Change of Control Purchase Price with respect to such
Securities) in which case, upon such return, the Change of Control Purchase
Notice with respect thereto shall be deemed to have been withdrawn.

25

 

               Section 3.10 Deposit of Change of Control Purchase Price. Prior to 11:00
a.m. (New York City time) on the Business Day preceding the Repurchase Date,
the Company shall deposit with the Trustee or with the Paying Agent (or, if the
Company or a Subsidiary or an Affiliate of either of them is acting as the
Paying Agent, shall segregate and hold in trust as provided in Section 2.4) an
amount of money (in immediately available funds if deposited on such Business
Day) and such other required non-cash consideration sufficient to pay the
aggregate Change of Control Purchase Price of the Securities or portion thereof
to be purchased on the Repurchase Date.

               Section 3.11 Securities Purchased in Part. Any certificated Security that
is to be purchased only in part shall be surrendered at the office of the
Paying Agent (with, if the Company or the Trustee so requires, due endorsement
by, or a written instrument of transfer in form satisfactory to the Company and
the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly
authorized in writing) and the Company shall execute and the Trustee shall
authenticate and deliver to the Holder of such Security, without service
charge, a new Security or Securities, of any authorized denomination as
requested by such Holder representing an aggregate original principal amount
equal to, and in exchange for, the portion of the original principal amount of
the Security so surrendered which is not purchased.

               Section 3.12 Covenant to Comply with Securities Laws upon Purchase of
Securities. In connection with any offer to purchase or purchase of Securities
under Section 3.8, and if such offer to purchase or purchase constitutes an
“issuer tender offer” for purposes of Rule 13e-4 (which term, as used herein,
includes any successor provision thereto) under the Exchange Act at the time of
such offer or purchase, the Company shall (i) comply in all material respects
with Rule 13e-4 and Rule 14e-1 under the Exchange Act, (ii) file the related
Schedule TO (or any successor schedule, form or report) under the Exchange Act,
and (iii) otherwise comply in all material respects with all federal and state
securities laws so as to permit the rights and obligations under Section 3.8 to
be exercised in the time and in the manner specified in Section 3.8.

               Section 3.13 Repayment to the Company. The Trustee and the Paying Agent,
as the case may be, shall return to the Company any cash and other non-cash
consideration, if any, that remains unclaimed as provided in paragraph 12 of
the Securities, together with interest, if any, thereon (subject to the
provisions of Section 7.1(f)), held by them for the payment of the Change of
Control Purchase Price; provided, however, that to the extent that the
aggregate amount of cash and other non-cash consideration, if any, deposited by
the Company pursuant to Section 3.10 exceeds the aggregate Change of Control
Purchase Price of the Securities or portions thereof which the Company is
obligated to purchase as of the Repurchase Date, then, unless otherwise agreed
in writing with the Company, promptly after the Business Day following the
Repurchase Date, the Trustee shall return any such excess to the Company
together with interest, if any, thereon (subject to the provisions of Section
7.1(f)).

ARTICLE 4

COVENANTS

               Section 4.1 Payment of Securities. The Company shall promptly make all
payments in respect of the Securities on the dates and in the manner provided
in the Securities or pursuant to this Indenture. Any amounts to be given to the
Trustee or Paying Agent shall be considered paid on the date it is due if
deposited with the Trustee or Paying Agent, as the case may be, by 11:00 a.m.
(New York City time) by the Company or an Affiliate thereof. An installment of
principal or interest (including Stated Interest, Contingent Interest and
Deferred Interest) thereon, if any, shall be considered paid on the

26

 

applicable due date if on such date the Trustee or the Paying Agent holds,
in accordance with this Indenture, money sufficient to pay all such amounts
then due.

               The Company shall, to the extent permitted by law and unless otherwise
provided in this Indenture, pay interest on overdue amounts at the rate per
annum set forth in paragraph 1 of the Securities, compounded semiannually,
which interest shall accrue from the date such overdue amount was originally
due to the date of payment of such amount, including interest thereon, has been
made or duly provided for. All such interest shall be payable on demand. The
accrual of such interest on overdue amounts shall be in addition to the
continued accrual of interest on the Securities.

               Section 4.2 Compliance Certificate. The Company shall deliver to the
Trustee within 90 days after the end of each fiscal year of the Company
(beginning with the fiscal year ending on December 31, 2004) an Officers’
Certificate, stating whether or not to the knowledge of the signers thereof the
Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.

               Section 4.3 Further Instruments and Acts. Upon request of the Trustee or
as necessary, the Company will execute and deliver such further instruments and
do such further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture.

               Section 4.4 Maintenance of Office or Agency. The Company will maintain in
the Borough of Manhattan, the City of New York, an office or agency where
Securities may be presented and surrendered for payment, registration of
transfer, exchange, purchase, redemption or conversion and where payment of
interest on the Securities may be made. The office of the Trustee in the City
of New York located at 101 Barclay Street, New York, New York 10286 shall
initially be such office or agency for all of the aforesaid purposes. The
Company shall give prompt written notice to the Trustee of the location, and of
any change in the location, of any such office or agency, unless such office or
agency is an office or agency of the Trustee or any of its Affiliates. If at
any time the Company shall fail to maintain any such required office or agency
or shall fail to furnish the Trustee with the address thereof in accordance
with this paragraph, such presentations, surrenders, notices and demands may be
made or served at the address of the Trustee set forth in Section 12.2.

               The Company may also 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 Borough of
Manhattan, the City of New York, for such purposes.

               Section 4.5 Tax Treatment of Securities. The Company and each Holder by
purchasing a Security agree that (i) the Securities are contingent payment debt
instruments within the meaning of Treasury Regulations § 1.1275-4, (ii) each
Holder shall be bound by the Company’s application of the Treasury regulations
to the Securities, including the Company’s determination of the comparable
yield within the meaning of Treasury Regulations § 1.1275-4(b)(4), (iii) each
Holder shall use the projected payment schedule attached as Exhibit C to this
Indenture with respect to the Securities, as provided in Treasury Regulations §
1.1275-4(b)(4), to determine its interest accruals and adjustments as provided
in Treasury Regulations § 1.1275-4(b)(4)(iv), and (iv) the Company and each
Holder will not take any position on a tax return inconsistent with (i), (ii)
or (iii) above, unless required by applicable law.

27

 

               In addition, the Company agrees, and each Holder and any beneficial owner
of a Security by its participation in the exchange offer of the Existing
Securities for Securities shall be deemed to agree to treat the exchange of the
Existing Securities for Securities and the payment of the exchange fee as not
constituting a significant modification of the terms of the Existing Securities
and as not constituting an exchange for purposes of Section 1001 of the
Internal Revenue Code of 1986, as amended.

ARTICLE 5

SUCCESSOR CORPORATION

               Section 5.1 When Company May Merge or Transfer Assets. The Company shall
not consolidate with or merge with or into any other Person or sell, lease,
convey or otherwise dispose of all or substantially all of its properties and
assets substantially to any Person, unless:

               (a) (1) the Company shall be the surviving Person or the Person formed by
such consolidation or into which the Company is merged or the Person to which
the properties and assets of the Company are so sold, leased, conveyed or
otherwise disposed (the “Surviving Person”) is a corporation, limited liability
company, partnership or trust organized and validly existing under the laws of
the United States or any State thereof or the District of Columbia and (2) if
the Company is not the Surviving Person, the Surviving Person expressly
assumes, by an indenture supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, all of the obligations of the
Company under the Securities and this Indenture;

               (b) immediately after giving effect to such transaction, no Event of
Default shall have occurred and be continuing; and

               (c) the Company shall have delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger, sale, lease, conveyance or other disposal and, if a supplemental
indenture is required in connection with such transaction, such supplemental
indenture, comply with this Article 5, that all conditions precedent herein
provided for relating to such transaction have been satisfied and such Opinion
of Counsel shall also state that such supplemental indenture is enforceable
against the Surviving Person in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, moratorium or other laws relating to or
affecting creditors’ rights and by general principles of equity.

               For purposes of the foregoing, the transfer (by sale, lease, conveyance or
other disposal) of the properties and assets of one or more Subsidiaries (other
than to the Company or another Subsidiary), which if such assets were owned by
the Company would constitute all or substantially all of the properties and
assets of the Company, shall be deemed to be the transfer of all or
substantially all of the properties and assets of the Company.

               Upon the execution and delivery of a supplemental indenture as provided in
(a)(2) above, the Surviving Person shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture
with the same effect as if such Surviving Person had been named as the Company
herein; and thereafter, except in the case of a lease of all or substantially
all of the Company’s assets and with respect to any obligations the Company may
have under a supplemental indenture pursuant to Section 10.5, the Company shall
be discharged from all obligations and covenants under this Indenture and the
Securities. Subject to Section 9.6, the Company, the Trustee and the Surviving
Person shall enter into a supplemental indenture to evidence the succession and
substitution of such Surviving Person and such discharge and release of the
Company.

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ARTICLE 6

DEFAULTS AND REMEDIES

               Section 6.1 Events of Default. An “Event of Default” occurs if:

               (a) the Company defaults in the payment of any interest (including Stated
Interest and Contingent Interest), if any, payable on any Security and such
default continues for 30 days or more after such payment becomes due and
payable, except to the extent payment of Stated Interest is deferred pursuant
to Section 2.14;

               (b) the Company defaults in the payment of the Accreted Principal Amount,
Deferred Interest, premium (if any), Redemption Price or Change of Control
Purchase Price on any Security when the same becomes due and payable, except to
the extent payment of Deferred Interest is extended pursuant to Section 2.14;

               (c) the Company fails to comply with any of its covenants or agreements in
the Securities or this Indenture (other than those referred to in clauses (a)
and (b) above) and such failure continues for 90 days after there shall have
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
original principal amount of the outstanding Securities, a written notice (a
“Notice of Default”) specifying such Default and requiring the Company to cause
such Default to be cured and stating that such notice is a Notice of Default
hereunder;

               (d) the Company fails to make any payment when due, including any
applicable grace period, in respect of indebtedness for borrowed money of the
Company, which failure to pay results in acceleration of such indebtedness
which is in an amount in excess of the Applicable Limit, and such indebtedness
is not discharged, or such payment default and acceleration is not cured or
rescinded, within a period of 30 days;

               (e) the Company defaults with respect to any indebtedness for borrowed
money of the Company (other than a Default described in (d) above) that results
in the acceleration of such indebtedness, which default results in acceleration
of any such indebtedness which is in an amount in excess of the Applicable
Limit and such indebtedness is not discharged, or such acceleration is not
rescinded, within a period of 30 days;

               (f) 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 or
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

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

29

 

               The Company shall deliver to the Trustee, within 30 days after it becomes
aware of the occurrence thereof, written notice of any event which with the
giving of notice or the lapse of time, or both, would become an Event of
Default under (c), (d) or (e) above, its status and what action the Company is
taking or proposes to take with respect thereto.

               Section 6.2 Acceleration. If an Event of Default (other than an Event of
Default specified in Section 6.1(f) or (g)) occurs and is continuing, the
Trustee by notice to the Company or the Holders of at least 25% in aggregate
original principal amount of the Securities at the time outstanding by notice
to the Company and the Trustee, may declare the then Accreted Principal Amount
of all the Securities plus all accrued and unpaid interest (including Stated
Interest, Contingent Interest and Deferred Interest) thereon, if any, through
the date of declaration to be immediately due and payable. Upon such a
declaration, such Accreted Principal Amount plus all accrued interest
(including Stated Interest, Contingent Interest and Deferred Interest) thereon,
if any, shall become and be immediately due and payable. If an Event of Default
specified in Section 6.1(f) or (g) occurs, the Accreted Principal Amount of all
the Securities plus all accrued interest (including Stated Interest, Contingent
Interest and Deferred Interest) thereon, if any, shall become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holders. The Holders of a majority in aggregate original
principal amount of the Securities at the time outstanding, by notice to the
Trustee (and without notice to any other Holder), may rescind an acceleration
and its consequences if (i) the rescission would not conflict with any judgment
or decree, (ii) all existing Events of Default have been cured or waived except
nonpayment of the Accreted Principal Amount plus all accrued interest thereon,
if any, that have become due solely as a result of acceleration, and (iii) all
amounts due to the Trustee under Section 7.7 have been paid. No such rescission
shall affect any subsequent Default or impair any right consequent thereto.

               Section 6.3 Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of the Accreted Principal Amount of all the Securities plus all accrued
interest (including Stated Interest, Contingent Interest and Deferred
Interest), if any, thereon or to enforce the performance of any provision of
the Securities or this Indenture.

               The Trustee may maintain a proceeding even if the Trustee does not possess
any of the Securities or does not produce any of the Securities in the
proceeding. A delay or omission by the Trustee or any Holder in exercising any
right or remedy accruing upon an Event of Default shall not impair the right or
remedy or constitute a waiver of, or acquiescence in, the Event of Default. No
remedy is exclusive of any other remedy. All available remedies are cumulative
to the extent permitted by law.

               Section 6.4 Waiver of Past Defaults. The Holders of a majority in
aggregate original principal amount of the Securities at the time outstanding,
by notice to the Trustee (and without notice to any other Holder), may waive an
existing Default and its consequences except (i) an Event of Default described
in Section 6.1(a) or 6.1(b) above, (ii) a Default in respect of a provision
that under Section 9.2 cannot be amended without the consent of each Holder
affected or (iii) a Default which constitutes a failure to convert any Security
in accordance with the terms of Article 10. When a Default is waived, it is
deemed cured, but no such waiver shall extend to any subsequent or other
Default or impair any consequent right. This Section 6.4 shall be in lieu of
Section 316(a)1(B) of the TIA and such Section 316(a)1(B) is hereby expressly
excluded from this Indenture, as permitted by the TIA.

               Section 6.5 Control by Majority. The Holders of a majority in aggregate
original principal amount of the Securities at the time outstanding may direct
the time, method and place of conducting any proceeding for any remedy
available to the Trustee or of exercising any trust or power conferred on the
Trustee. However, the Trustee may refuse to follow any direction (i) which
conflicts with applicable law or this Indenture or (ii) which the Trustee
determines in good faith is (x) unduly prejudicial to the rights of other
Holders or (y) would involve the Trustee in personal liability unless the

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Trustee is offered indemnity satisfactory to it. This Section 6.5 shall be
in lieu of Section 316(a)1(A) of the TIA and such Section 316(a)1(A) is hereby
expressly excluded from this Indenture, as permitted by the TIA.

               Section 6.6 Limitation on Suits. A Holder may not pursue any remedy with
respect to this Indenture or the Securities unless:

               (a) the Holder gives to the Trustee written notice stating that an Event
of Default is continuing;

               (b) the Holders of at least 25% in aggregate original principal amount of
the Securities at the time outstanding make a written request to the Trustee to
pursue the remedy;

               (c) such Holder severally, or jointly with other Holders, offer the
Trustee security or indemnity satisfactory to the Trustee against any loss,
liability, claim, damage or expense;

               (d) the Trustee does not comply with the request within 60 days after
receipt of such notice, request and offer of security or indemnity; and

               (e) the Holders of a majority in aggregate original principal amount of
the Securities at the time outstanding do not give the Trustee a direction
inconsistent with the request during such 60-day period.

               A Holder may not use this Indenture to prejudice the rights of any other
Holder or to obtain a preference or priority over any other Holder.

               Section 6.7 Rights of Holders to Receive Payment. Notwithstanding any
other provision of this Indenture, the right of any Holder to receive payment
of the Accreted Principal Amount of or premium, if any, or interest (including
Stated Interest, Contingent Interest and Deferred Interest), if any, on the
Securities (including interest, if any, due on overdue amounts) held by such
Holder, on or after the respective due dates expressed in the Securities, and
to convert the Securities in accordance with Article 10, or to bring suit for
the enforcement of any such payment on or after such respective dates or the
right to convert, shall not be impaired or affected adversely without the
consent of such Holder.

               Section 6.8 Collection Suit by Trustee. If an Event of Default described
in Section 6.1(a) or 6.1(b) occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Company
for the whole amount owing with respect to the Security and the amounts
provided for in Section 7.7.

               Section 6.9 Trustee May File Proofs of Claim. In case of the pendency of
any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
the Company or any other obligor upon the Securities or the property of the
Company, or of such other obligor or their creditors, the Trustee (irrespective
of whether any Accreted Principal Amount of or premium, if any, or interest
(including Stated Interest, Contingent Interest and Deferred Interest), if any,
on the Securities, including interest, if any, due on overdue amounts, 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 on the Company
for the payment of any such amount) shall be entitled and empowered, by
intervention in such proceeding or otherwise,

               (a) to file and prove a claim for any accrued and unpaid Accreted
Principal Amount of or premium, if any, or interest (including Stated Interest,
Contingent Interest and Deferred Interest), if any,

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on the Securities or interest, if any, due on overdue amounts in respect
of the Securities, and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee (including
any claim for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel or any other amounts due to the Trustee
under Section 7.7) and of the Holders allowed in such judicial proceeding; and

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

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official in any such judicial proceeding is hereby authorized by each
Holder 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
the Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due to the Trustee under Section 7.7.

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

               Section 6.10 Priorities. If the Trustee collects any money pursuant to
this Article 6, it shall pay out the money in the following order:

   First, to the Trustee for amounts due under Section 7.7;

   Second, to the holders of Senior Debt to the extent required by Article
11;

   Third, to Holders for amounts due and unpaid on the Securities for
Accreted Principal Amount and interest (including Stated Interest, Contingent
Interest and Deferred Interest, if any), ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Securities for Accreted Principal Amount and interest (including Stated
Interest, Contingent Interest and Deferred Interest, if any), respectively;
and

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

               The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 6.10. At least 15 days before such record
date, the Trustee shall mail to each Holder a notice that states the record
date, the payment date and the amount to be paid.

               Section 6.11 Undertaking for Costs. In any suit for the enforcement of any
right or remedy under this Indenture or in any suit against the Trustee for any
action taken or omitted by it as Trustee, a court in its discretion may require
the filing by any party litigant (other than the Trustee) in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys’ fees and expenses,
against any party litigant in the suit, having due regard to the merits and
good faith of the claims or defenses made by the party litigant. This Section
6.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to
Section 6.6 or a suit by Holders of more than 10% in aggregate original
principal amount of the Securities at the time outstanding. This Section 6.11
shall be in lieu of Section 315(e) of the TIA and such Section 315(e) is hereby
expressly excluded from this Indenture, as permitted by the TIA.

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               Section 6.12 Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury or other law
wherever enacted, now or at any time hereafter in force, which would prohibit
or forgive the Company from paying all or any portion of any principal of or
premium, if any, or interest on the Securities (including interest, if any, due
on overdue amounts, as contemplated herein, or which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it
may lawfully do so) hereby expressly waives all benefit or advantage of any
such law and covenants that it will not hinder, delay or impede the execution
of any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.

ARTICLE 7

TRUSTEE

               Section 7.1 Duties of Trustee. If an Event of Default has occurred and
is continuing, the Trustee shall exercise the rights and powers vested in it by
this Indenture and use the same degree of care and skill in its exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person’s own affairs.

               (b) Except during the continuance of an Event of Default:

          (1) the Trustee need perform only those duties that are specifically
set forth in this Indenture and no others; and

          (2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements of this
Indenture, but in case of any such certificates or opinions which by any
provision hereof are specifically required to be furnished to the
Trustee, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture, but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein. This Section
7.1(b) shall be in lieu of Section 315(a) of the TIA and such Section
315(a) is hereby expressly excluded from this Indenture, as permitted by
the TIA.

               (c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:

          (1) this paragraph (c) does not limit the effect of paragraph (b) of
this Section 7.1;

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

          (3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.5.

Subparagraphs (c)(1), (2) and (3) shall be in lieu of Sections 315(d)(1),
315(d)(2) and 315(d)(3) of the TIA and such Sections 315(d)(1), 315(d)(2) and
315(d)(3) are hereby expressly excluded from this Indenture, as permitted by
the TIA.

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               (d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (e) of this Section 7.1.

               (e) The Trustee may refuse to perform any duty or exercise any right or
power or extend or risk its own funds or otherwise incur any financial
liability unless it receives indemnity satisfactory to it against any loss,
liability or expense.

               (f) Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee (acting in
any capacity hereunder) shall be under no liability for interest on any money
received by it hereunder unless otherwise agreed in writing with the Company.

               (g) The Trustee shall obtain, or shall caused to be obtained at the
expense of the Company, the Volume Weighted Average Price as necessary under
this Indenture, to the extent such Volume Weighted Average Price is available
on Bloomberg.

               Section 7.2 Rights of Trustee. Subject to its duties and responsibilities
under the TIA,

               (a) the Trustee may conclusively rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, security,
note, other evidence of indebtedness 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) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its
part, conclusively rely upon an Officers’ Certificate;

               (c) 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 and 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;

               (d) the Trustee shall not be liable for any action taken, suffered, or
omitted to be taken by it in good faith which it believes to be authorized or
within its rights or powers conferred under this Indenture;

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

               (f) 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 Holders, pursuant to the provisions of this Indenture, unless such
Holders shall have offered to the Trustee security or indemnity satisfactory to
it against the costs, expenses and liabilities which may be incurred therein or
thereby;

               (g) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;

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               (h) 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, direction, consent, order, bond, security,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney
at the sole cost of the Company and shall incur no liability or additional
liability of any kind by reason of such inquiry or investigation;

               (i) the rights, privileges, protections, immunities and benefits given to
the Trustee, including its right to be indemnified, are extended to, and shall
be enforceable by, the Trustee in each of its capacities hereunder, and to each
agent, custodian and other Person employed to act hereunder; and

               (j) the Trustee may request that the Company deliver an Officers’
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Indenture,
which Officers’ Certificate may be signed by any Person authorized to sign an
Officers’ Certificate, including any Person specified as so authorized in any
such certificate previously delivered and not superseded.

               Section 7.3 Individual Rights of Trustee. The Trustee in its individual or
any other capacity may become the owner or pledgee of Securities and may
otherwise deal with the Company or its Affiliates with the same rights it would
have if it were not Trustee. Any Paying Agent, Registrar, Conversion Agent or
Bid Solicitation Agent may do the same with like rights. However, the Trustee
must comply with Sections 7.10 and 7.11.

               Section 7.4 Trustee’s Disclaimer. The Trustee makes no representation as
to the validity or adequacy of this Indenture or the Securities, it shall not
be accountable for the Company’s use or application of the proceeds from the
Securities, it shall not be responsible for any statement in the registration
statement for the Securities under the Securities Act or in any offering
document for the Securities, the Indenture or the Securities (other than its
certificate of authentication), or the determination as to which beneficial
owners are entitled to receive any notices hereunder.

               Section 7.5 Notice of Defaults. If a Default occurs and if it is known to
the Trustee, the Trustee shall give to each Holder notice of the Default within
90 days after it occurs or, if later, within 15 days after it is known to the
Trustee, unless such Default shall have been cured or waived before the giving
of such notice. Notwithstanding the preceding sentence, except in the case of a
Default described in Sections 6.1(a) and 6.1(b), the Trustee may withhold the
notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of Holders. The
second sentence of this Section 7.5 shall be in lieu of the proviso to Section
315(b) of the TIA and such proviso is hereby expressly excluded from this
Indenture, as permitted by the TIA. The Trustee shall not be deemed to have
knowledge of a Default unless a Responsible Officer of the Trustee has received
written notice of such Default and such notice references the securities and
this Indenture.

               Section 7.6 Reports by Trustee to Holders. Within 60 days after each May
15 beginning with the May 15 following the date of this Indenture, the Trustee
shall mail to each Holder a brief report dated as of such May 15 that complies
with TIA Section 313(a), if required by such Section 313(a). The Trustee also
shall comply with TIA Section 313(b).

     A copy of each report at the time of its mailing to Holders shall be filed
with the SEC and each securities exchange, if any, on which the Securities are
listed. The Company agrees to notify the Trustee promptly whenever the
Securities become listed on any securities exchange and of any delisting
thereof.

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               Section 7.7 Compensation and Indemnity. The Company agrees:

               (a) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited (to
the extent permitted by law) by any provision of law in regard to the
compensation of a trustee of an express trust);

               (b) to reimburse the Trustee upon its request for all reasonable
out-of-pocket expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Indenture (including the
reasonable compensation and the expenses, advances and disbursements of its
agents and counsel), except any such expense, disbursement or advance as may be
attributable to its own negligence, bad faith or willful misconduct; and

               (c) to indemnify the Trustee or any predecessor Trustee and their agents
for, and to hold them harmless against, any and all loss, damage, claim,
liability, cost or expense (including reasonable attorney’s fees and taxes
(other than taxes based upon, measured by or determined by the income of the
Trustee)) incurred without negligence or bad faith on its part, arising out of
or in connection with the acceptance or administration of this trust, including
the costs and expenses of defending itself against any claim (whether asserted
by the Company or any Holder or any other Person) or liability in connection
with the exercise or performance of any of its powers or duties hereunder.

               To secure the Company’s payment obligations in this Section 7.7, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee, except that held in trust to pay the principal of
or premium, if any, or interest on the Securities or interest, if any, due on
overdue amounts, as the case may be, in respect of any Securities.

               The Company’s payment obligations pursuant to this Section 7.7 shall
survive the discharge of this Indenture and the resignation or removal of the
Trustee. When the Trustee incurs expenses after the occurrence of a Default
specified in Section 6.1(f) or (g), the expenses, including the reasonable
charges and expenses of its counsel, are intended to constitute expenses of
administration under any bankruptcy law.

               Section 7.8 Replacement of Trustee. A resignation or removal of the
Trustee and appointment of a successor Trustee shall become effective only upon
the successor Trustee’s acceptance of appointment as provided in this Section
7.8.

               The Trustee may resign by so notifying the Company at least 30 days prior
to the date of the proposed resignation. The Holders of a majority in aggregate
original principal amount of the Securities at the time outstanding may remove
the Trustee by so notifying the Trustee and the Company in writing. The Company
may at any time prior to the occurrence and continuation of an Event of Default
remove the Trustee by Company Order given at least 30 days prior to the date of
the proposed removal.

               The Company shall remove the Trustee if:

               (a) the Trustee fails to comply with Section 7.10;

               (b) the Trustee is adjudged bankrupt or insolvent;

               (c) a receiver or public officer takes charge of the Trustee or its
property; or

36

 

               (d) the Trustee otherwise becomes incapable of acting.

               If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint, by resolution of
its Board of Directors, a successor Trustee.

               A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company satisfactory in form and substance
to the retiring Trustee and the Company. Thereupon the resignation or removal
of the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture. The
successor Trustee shall mail a notice of its succession to Holders. The
retiring Trustee shall promptly transfer all property held by it as Trustee to
the successor Trustee, subject to the lien provided for in Section 7.7.

               If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or
the Holders of a majority in aggregate original principal amount of the
Securities at the time outstanding may petition any court of competent
jurisdiction at the expense of the Company for the appointment of a successor
Trustee.

               If the Trustee fails to comply with Section 7.10, any Holder may petition
any court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.

               The Company shall give notice of any resignation and any removal of the
Trustee and each appointment of a successor Trustee to all Holders. Each notice
shall include the name of the successor Trustee and the address of its
Corporate Trust Office.

               Section 7.9 Successor Trustee by Merger. If the Trustee consolidates with,
merges or converts into, or transfers all or substantially all its corporate
trust business or assets (including the administration of the trust created by
this Indenture) to, another corporation, the resulting, surviving or transferee
corporation without any further act shall be the successor Trustee.

               Section 7.10 Eligibility; Disqualification. The Trustee shall at all times
satisfy the requirements of TIA Sections 310(a)(1) and 310(b). The Trustee (or
its parent holding company) shall have a combined capital and surplus of at
least $50,000,000 as set forth in its most recent published annual report of
condition. Nothing herein contained shall prevent the Trustee from filing with
the SEC the application referred to in the penultimate paragraph of TIA Section
310(b).

               Section 7.11 Preferential Collection of Claims Against Company. The
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.

ARTICLE 8

DISCHARGE OF INDENTURE

               Section 8.1 Discharge of Liability on Securities. When (i) the Company
delivers to the Trustee all outstanding Securities (other than Securities
replaced pursuant to Section 2.7) for cancellation or (ii) all outstanding
Securities have become due and payable and the Company deposits with the
Trustee cash sufficient to pay all amounts due and owing on all outstanding
Securities (other than Securities replaced pursuant to Section 2.7), and, in
either case, the Company pays all other sums and amounts

37

 

payable hereunder by the Company, then (x) this Indenture shall, subject
to Section 7.7, cease to be of further effect, and (y) the Trustee shall, on
demand of and at the expense of the Company, join in the execution of a
document acknowledging satisfaction and discharge of this Indenture, provided
that the Company has delivered to the Trustee an Officers’ Certificate and
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.

               Section 8.2 Repayment to the Company. The Trustee and the Paying Agent
shall return to the Company upon written request any money or securities or
other non-cash amounts held by them for the payment of any amount with respect
to the Securities that remains unclaimed for two years after a right to such
money or securities or other non-cash amounts has matured, subject to
applicable unclaimed property law. After such return to the Company, Holders
entitled to such money or securities or other non-cash amounts must look to the
Company for payment as general creditors unless an applicable abandoned
property law designates another Person and the Trustee and the Paying Agent
shall have no further liability to the Holders with respect to such money or
securities or other non-cash amounts for that period commencing after the
return thereof.

ARTICLE 9

AMENDMENTS, SUPPLEMENTS AND WAIVERS

               Section 9.1 Without Consent of Holders. The Company and the Trustee may
amend or supplement this Indenture or the Securities without the consent of any
Holder:

               (a) to cure any ambiguity, defect or inconsistency herein or in the
Securities;

               (b) to provide for the assumption of the Company’s obligations to Holders;

               (c) to comply with Section 5.1 or Section 10.5;

               (d) to make any change that does not materially adversely affect the
rights of any Holder; or

               (e) to make any change necessary for the registration of the Securities
under the Securities Act or to comply with the TIA, or any amendment thereto,
or to comply with any requirement of the SEC in connection with the
qualification of the Indenture under the TIA.

               Section 9.2 With Consent of Holders. The Company and the Trustee may amend
or supplement this Indenture or the Securities with the written consent of the
Holders of at least a majority in aggregate original principal amount of the
Securities then outstanding, and the Holders of a majority in aggregate
original principal amount of the Securities then outstanding may waive
compliance by the Company with any provision of this Indenture or the
Securities. However, without the consent of each Holder affected, an amendment,
supplement or waiver under this Section may not:

               (a) change the Stated Maturity or due dates of the principal of, or
interest (including Stated Interest, Contingent Interest and Deferred Interest)
on, any Security, or adversely affect the right of a Holder to convert any
Security, or change the amount of cash or Common Stock issuable upon any
conversion;

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               (b) reduce the Accreted Principal Amount, the Redemption Price or Change
of Control Purchase Price of, or premium, if any, or interest (including Stated
Interest, Contingent Interest and Deferred Interest) on, any Security;

               (c) change the currency for payment of principal or Accreted Principal
Amount, the Redemption Price or the Change of Control Purchase Price of, or
interest (including Stated Interest, Contingent Interest and Deferred Interest)
on, any Security;

               (d) impair the right to institute suit for the enforcement of any payment
on or with respect to any Security;

               (e) reduce the above stated percentage of outstanding Securities whose
Holders must consent to an amendment or supplement of this Indenture or a
waiver of defaults or failure to comply hereunder;

               (f) make any change in Article 11 or the ranking or priority of any
Securities in a manner materially adverse to the Holders; or

               (g) make any change in Section 6.4 or 6.7 or this Section 9.2 (second
sentence).

               It shall not be necessary for the consent of the Holders under this
Article 9 to approve the particular form of any proposed amendment, supplement
or waiver, but it shall be sufficient if such consent approves the substance
thereof. The Company may establish, by delivery of an Officers’ Certificate to
the Trustee, a record date for determining Holders of record entitled to give
any consent or waiver pursuant to this Article 9.

               After an amendment or supplement under this Section becomes effective, the
Company shall mail to Holders a notice briefly describing such amendment or
supplement; provided that any failure of the Company to mail any such notice,
or any defect therein, shall not in any way impair or affect the validity of
any supplemental indenture.

               Section 9.3 Compliance with Trust Indenture Act. Every amendment to or
supplement of this Indenture or the Securities shall comply with the TIA as
then in effect.

               Section 9.4 Revocation and Effect of Consents. Until an amendment,
supplement or waiver becomes effective, a consent to it by a Holder of a
Security is a continuing consent by the Holder and every subsequent Holder of a
Security or portion of a Security that evidences the same debt as the
consenting Holder’s Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to such Security or portion of a Security if a Trust Officer of the
Trustee receives the notice of revocation before the date the amendment,
supplement or waiver becomes effective. An amendment, supplement or waiver
becomes effective in accordance with its terms and thereafter binds every
Holder. Notwithstanding the foregoing, if a record date has been established
for the purpose of determining Holders entitled to consent, such written notice
of revocation must be signed by the Holder of record as of the record date or
his duly appointed proxy.

               Section 9.5 Notation on or Exchange of Securities. Securities
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article 9 may, and shall if required by the Trustee, bear a
notation in form approved by the Trustee as to any matter provided for in such
supplemental indenture. If the Company shall so determine, new Securities so
modified as to conform, in the opinion of the Trustee and the Board of
Directors of the Company, to any such supplemental

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indenture may be prepared and executed by the Company and authenticated
and delivered by the Trustee in exchange for outstanding Securities.

               Section 9.6 Trustee to Sign Supplemental Indentures. The Trustee shall
sign any supplemental indenture authorized pursuant to this Article 9 if the
amendment contained therein does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. If it does, the Trustee may, but need
not, sign such supplemental indenture. In signing such supplemental indenture
the Trustee shall receive, and (subject to the provisions of Section 7.1) shall
be entitled to conclusively rely upon, an Officers’ Certificate and an Opinion
of Counsel stating that such amendment is authorized or permitted by this
Indenture.

               Section 9.7 Effect of Supplemental Indentures. Upon the execution of any
supplemental indenture under this Article, this Indenture shall be modified in
accordance therewith, and such supplemental indenture shall form a part of this
Indenture for all purposes; and every Holder of Securities theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.

ARTICLE 10

CONVERSIONS

               Section 10.1 Conversion Privilege. A Holder may convert any Securities
or any portion of the original principal amount thereof which is an integral
multiple of $1,000 into cash and duly authorized, fully paid and nonassessable
shares of Common Stock, if any, at any time prior to Stated Maturity, at the
Conversion Price set forth in paragraph 8 of the Securities, subject to
adjustment as hereinafter provided, if at least one of the conditions for
conversion provided in clause (b) below is satisfied. Whenever the Securities
shall become convertible pursuant to this Section 10.1, the Company or, at the
Company’s written request, the Trustee in the name and at the expense of the
Company, shall notify the Holders of the event triggering such convertibility
in the manner provided in Section 12.2. Any notice so given shall be deemed
duly given, whether or not the Holder receives such notice.

               (b) Conditions for Conversion. (i) Conversion upon Satisfaction of Market
Price Condition. A Holder may convert Securities into cash and shares of Common
Stock, if any, if the Sale Price per share of the Common Stock for at least 20
Trading Days in the 30 Trading-Day period ending on the Trading Day immediately
preceding the date on which Securities are surrendered for conversion exceeds
140% of the Initial Stock Price. The Conversion Agent shall determine on a
daily basis whether the Securities shall be convertible pursuant to this clause
(b)(i) and, if the Securities shall be so convertible, the Conversion Agent
shall promptly deliver written notice thereof to the Company and, if the
Trustee is not acting as Conversion Agent pursuant to Section 2.3 at the time
of such notification, to the Trustee.

          (ii) Conversion upon an Event of Default. A Holder may convert
Securities into cash and shares of Common Stock, if any, during any
period in which an Event of Default has occurred and is continuing.

          (iii) Conversion upon Notice of Redemption. A Holder may convert
into cash and shares of Common Stock, if any, any Securities called for
redemption pursuant to a notice of redemption mailed by the Company in
accordance with Section 3.3 at any time prior to the close of business on
the day that is two Business Days prior to the Redemption Date, even if
such Securities are not otherwise convertible at such time.

40

 

          (iv) Conversion upon a Special Conversion Event. Any Holder may
request, by delivery to the Bid Solicitation Agent at its office on any
Business Day of a notice in writing complying with the requirements of
this paragraph (a “Request”), that the Bid Solicitation Agent obtain, on
such Holder’s behalf, firm bids to buy not less than $1,000,000 original
principal amount of Securities (or, if such Holder beneficially owns less
than $1,000,000 original principal amount of Securities, all of such
Holder’s Securities) nor more than $10,000,000 original principal amount
of Securities (such amount to be specified in the Request) during the
three consecutive Trading Days next following the date on which the
Request was delivered to the Bid Solicitation Agent (the “Measurement
Period”) from any nationally recognized securities dealers; provided that
in such Request (x) such Holder certifies that it could not obtain a firm
bid to purchase such Securities from at least two independent nationally
recognized securities dealers for such Securities in an amount at least
equal to the Minimum Amount per $1,000 original principal amount of
Securities, and provides the names of the securities dealers from which
such Holder has attempted to obtain such bids, (y) such Holder agrees to
use its best efforts to sell such Securities on any day during the
Measurement Period to any securities dealer that provides the Bid
Solicitation Agent with a firm bid to purchase such Securities in an
amount at least equal to the Minimum Amount per $1,000 original principal
amount of Securities and (z) such Holder agrees to convert such
Securities if the Bid Solicitation Agent cannot obtain a firm bid to
purchase the Securities at least equal to the Minimum Amount per $1,000
original principal amount of Security during the Measurement Period.

               If a Request is made by a Holder with respect to any Securities, then on
each day during the Measurement Period for such Request, the Bid Solicitation
Agent shall (a) seek to obtain, on behalf of such Holder, a firm bid to buy
such Securities for at least the Minimum Amount per $1,000 original principal
amount of the Securities on such day from Credit Suisse First Boston LLC (or
another nationally recognized securities dealer selected by the Company) by
1:00 p.m., New York City time, on such day and (b) if Credit Suisse First
Boston LLC (or such other securities dealer) does not provide a firm bid to buy
such Securities for at least the Minimum Amount per $1,000 original principal
amount of the Securities on such day, solicit on such Holder’s behalf firm bids
from at least two other nationally recognized securities dealers, on such day.
The Bid Solicitation Agent shall solicit such bids from Goldman, Sachs & Co.
and Merrill Lynch, Pierce, Fenner & Smith Incorporated, or such other
securities dealers selected by the Company.

               If the Bid Solicitation Agent does not receive a firm bid to buy the
Securities for at least the Minimum Amount per Security on any day during the
Measurement Period, a “Special Conversion Event” shall be deemed to have
occurred for the purposes of this Section 10.1(b)(iv) and the Trustee shall
promptly notify all Holders that a Special Conversion Event has occurred.
During the five Business-Day period commencing on the first Trading Day
following the giving of such notice, the Holder that submitted the Request
shall, and any other Holder may, convert their Securities in integral multiples
of $1,000 original principal amount into cash and a number of shares of Common
Stock, if any, pursuant to Section 10.3. In such event the conversion rate will
be equal to $990.00 divided by the Conversion Price then in effect.

               If the Bid Solicitation Agent receives a firm bid to buy the Securities
for at least the Minimum Amount per $1,000 original principal amount of the
Securities on any day during the Measurement Period, (x) a Special Conversion
Event shall be deemed not to have occurred, (y) the Bid Solicitation Agent
shall provide the Holder with the name of the securities dealer that provided
such quote and (z) the Holder shall use its best efforts to sell such
Securities to such securities dealer on such day for the price quoted by such
securities dealer.

41

 

               The “Minimum Amount” for a Security on any day, means the product of (a)
90% of the Sale Price for the Common Stock on such day multiplied by (b)
$1,100.00 divided by the Conversion Price in effect on such day.

          (v) Conversion upon an Interest Deferral. A Holder may convert
Securities into cash and shares of Common Stock, if any, at any time
during an Interest Deferral Period.

          (vi) Conversion upon Credit Rating Event. A Holder may convert
Securities into cash and shares of Common Stock, if any, during any
period in which (1) Standard & Poor’s Rating Services, a division of the
McGraw-Hill Companies, Inc., has downgraded the Company’s senior
long-term unsecured credit rating to BB+ or lower and Moody’s Investors
Services, Inc. has downgraded the Company’s senior long-term unsecured
credit rating to Ba2 or lower, (2) the senior long-term unsecured credit
rating of the Company is suspended or withdrawn by both such rating
agencies, or (3) neither of such rating agencies continues to provide
ratings services or coverage to the Company.

          (vii) Conversion upon Specified Corporate Transactions. If:

          (1) (A) the Company elects to distribute to all holders of Common
Stock rights or warrants entitling them to purchase shares of Common
Stock at a price per share that is less than the Current Market Price of
the Common Stock on the Trading Day immediately preceding the date of
declaration of such distribution, (B) the Company elects to distribute to
all holders of Common Stock cash or other assets, debt securities or
other evidence of indebtedness or other rights to purchase the Company’s
securities, where the Fair Market Value of such distribution attributable
to one share of Common Stock, when aggregated with all other such
distributions made within the 180 days preceding the date of declaration
of such distribution, exceeds 15% of the Current Market Price of the
Common Stock on the Trading Day immediately preceding the date of
declaration of such distribution, or (C) a transaction or transactions,
other than a transaction or transactions specified in Section
10.1(b)(vii)(2) below, constituting a Change of Control occurs; then, in
each case, the Securities may be surrendered for conversion at any time
on or after the date that the Company gives notice to the Holders of such
conversion right, which notice shall be given not less than 20 days prior
to the Ex-Dividend Time for such distribution, in the case of (A) or (B)
above, or within 30 days following the date of occurrence of the Change
of Control, in the case of (C) above, until either (x) the earlier of the
close of business on the Business Day immediately preceding the
Ex-Dividend Time and the date the Company announces that such
distribution will not take place, in the case of (A) or (B), or (y) 30
days after the Change of Control notice is given by the Company, in the
case of (C), provided that Securities shall not become convertible
pursuant to any distribution described above in (A) or (B) of this
Section 10.1(b)(vii)(1) if all Holders may participate in such
distribution without conversion of their Securities or if such
distribution consists solely of a distribution of rights pursuant to a
Rights Plan, provided that (to the extent that the Rights Plan has been
implemented and is still in effect upon such conversion) Holders will
receive, in addition to cash and the shares of Common Stock, if any,
issuable upon conversion of their Securities, the rights described in
such Rights Plan (whether or not the rights have separated from the
Common Stock at the time of conversion), subject to the limitations set
forth in the Rights Plan; or

          (2) the Company is party to a Merger Transaction, then the
Securities may be surrendered for conversion at any time from and after
the date which is 15 days prior to the date announced by the Company as
the anticipated effective date of such Merger Transaction until 15 days
after actual date of such Merger Transaction.

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               Section 10.2 Conversion Procedure; Fractional Shares. The Securities
shall be convertible at the office of the Conversion Agent as specified in this
Article 10. The amount of cash and the number of full shares of Common Stock,
if any, deliverable to a Holder pursuant to Section 10.3 upon conversion shall
be computed by aggregating all Securities (or portions thereof to the extent
permitted) surrendered by such Holder for conversion. Notwithstanding the
foregoing, a Security in respect of which a Holder has delivered a Change of
Control Purchase Notice exercising such Holder’s option to require the Company
to repurchase such Security may be converted only if such notice of exercise is
withdrawn in accordance with Section 3.9.

               (b) Before any Holder of a Security shall be entitled to convert the same,
such Holder shall, in the case of Securities issued in the form of Global
Securities, effect book-entry transfer of the Securities to be converted to the
Conversion Agent through the facilities of, and in compliance with the
procedures of the Depositary in effect at that time, and in the case of
certificated Securities, complete the conversion notice on the back of the
Securities (or a facsimile thereof) and surrender such Securities (duly
endorsed to the Company or in blank), the conversion notice and any transfer
documents required by the Conversion Agent at the office of the Conversion
Agent and, in each case, shall give written notice to the Company at the office
of the Conversion Agent that such Holder elects to convert the same and shall
state in writing therein the original principal amount represented by the
Securities to be converted and the name or names (with addresses) in which such
Holder wishes the certificate or certificates for Common Stock, if any, to be
issued.

               At the time of surrender of Securities for conversion, a Holder also shall
make the cash payment, if any, required pursuant to Section 10.3 and pay all
taxes or duties, if any, required pursuant to Section 10.9.

               Subject to the next succeeding sentence, the Company will, as soon as
practicable following the Conversion Period, subject to Section 10.3, issue and
deliver (or cause to be issued and delivered) at the office of the Conversion
Agent (or such other place within the Borough of Manhattan, New York as shall
be notified to such Holder at the time of surrender of such Securities) to such
Holder of a Security, or to such Holder’s nominee or nominees, certificates for
the number of full shares of Common Stock to which such Holder shall be
entitled, if any, together with cash payment and any other consideration for
any amounts to which such Holder shall be entitled pursuant to Section 10.3 and
Section 10.10. The Company shall not be required to deliver certificates for
shares of Common Stock while the stock transfer books for such stock or the
security register are duly closed for any purpose, but certificates for shares
of Common Stock shall be issued and delivered as soon as practicable after the
opening of such books or security register.

               (c) If the Company exercises its option to redeem the Securities pursuant
to Article 3, a Holder may nevertheless exercise its right to convert such
Securities in accordance with this Article 10 at any time before the close of
business on the date that is two Business Days prior to the Redemption Date.

               (d) A Security shall be deemed to have been converted as of the close of
business on the Conversion Date, and the Person or Persons entitled to receive
the Common Stock , if any, issuable upon such conversion shall be treated for
all purposes as the record Holder or Holders of such Common Stock, if any, as
of the close of business on such date (notwithstanding that such Person or
Persons may not receive the Common Stock until after the end of the Conversion
Period).

               (e) In case any Securities shall be surrendered for partial conversion,
the Company shall execute and the Trustee shall authenticate and deliver to or
upon the written order of the Holder of the Securities so surrendered, without
charge to such Holder (subject to the provisions of Section 10.9), new

43

 

Securities in authorized denominations representing a like principal
amount to the unconverted portion of the surrendered Securities.

               (f) The Company shall have the option, exercisable at any time or from
time to time, to designate or change the designation, by an instrument in
writing signed by the Company and provided to the Conversion Agent, a financial
institution to which Securities surrendered by a Holder for conversion will be
initially offered by the Conversion Agent on behalf of a Holder for exchange in
lieu of such conversion (an “Exchange Party”); provided that Securities
surrendered for conversion (i) prior to March 6, 2007, pursuant to satisfaction
of the condition for conversion provided in Section 10.1(b)(iii) or
10.1(b)(vii) above, or (ii) during the period after a Record Date and prior to
the corresponding Interest Payment Date, shall not be so offered by the
Conversion Agent for exchange. By 11:00 a.m. (New York City time) on each
Business Day, the Conversion Agent shall inform the Exchange Party as to the
aggregate original principal amount of Securities surrendered for conversion
prior to such time on such Business Day or after such time on the prior
Business Day. In order to accept Securities surrendered for conversion, the
Exchange Party must, by the close of business on such Business Day, agree to
deliver to the Conversion Agent in exchange therefor such consideration as the
Holder of such Securities surrendered for conversion would have received upon
conversion. Settlement for any such exchange shall take place no later than the
third Trading Day following the Conversion Period. In the event that the
Exchange Party fails to deliver cash and Common Stock, if any, by such third
Trading Day, instead of being exchanged, the Securities will be converted in
accordance with their terms and this Indenture. A Holder whose Securities are
exchanged in whole or in part shall be given a written confirmation from the
Conversion Agent informing such Holder as to the aggregate original principal
amount represented by the Securities so exchanged. Any Securities which have
been exchanged in lieu of conversion as described in this Section 10.2(f) shall
remain outstanding.

               As soon as practicable after the Conversion Period, the Company, in the
case of a conversion pursuant to this Article 10, or the Exchange Party, in the
case of an exchange contemplated by this Section 10.2(f), shall deliver to the
Holder, through the Conversion Agent, the consideration specified pursuant to
Section 10.3.

               Section 10.3 Payment Upon Conversion. If at least one of the conditions to
conversion pursuant to Section 10.1(b) is satisfied, Holders may convert their
Securities and shall be entitled to receive an amount of cash and shares of
Common Stock, if any, as follows:

               (a) Net Share Settlement Value. The Accreted Principal Amount of each
Security shall be convertible into cash and shares of Common Stock, if any,
based on the Daily Conversion Value (defined below), calculated for each of the
ten Trading Days immediately following the Conversion Date (the “Conversion
Period”). The Daily Conversion Value (the “Daily Conversion Value”) for each
Trading Day during the Conversion Period is equal to one-tenth of the product
of (1) the then applicable Conversion Rate and (2) the Consideration Per Share
on that day.

               For each $1,000 original principal amount of a Security surrendered for
conversion, the Company shall deliver to each Holder the aggregate of the
following (the “Conversion Obligation”) for each Trading Day during the
Conversion Period:

          (1) if the Daily Conversion Value for such Trading Day for each
Security exceeds the Accreted Principal Amount of such Security divided
by ten, (a) a cash payment equal to the greater of (x) the Accreted
Principal Amount on such day divided by ten or (y) the product of (i) the
amount of cash paid per share of Common Stock in connection with any
applicable Change of Control or Merger Transaction and (ii) the
Conversion Rate on the Conversion Date, divided by

44

 

ten and (b) the remaining Daily Conversion Value (the “Daily Net
Share Settlement Value”), if any, in shares of Common Stock (or
securities into which the Common Stock has been converted); or

          (2) if the Daily Conversion Value for such Trading Day for each
Security is equal to or less than the Accreted Principal Amount of such
Security divided by ten, a cash payment equal to the Daily Conversion
Value.

               The number of shares of Common Stock (or securities into which the Common
Stock has been converted) to be delivered pursuant to Section 10.3(a)(1)(b)
will be determined by dividing the Daily Net Share Settlement Value by the
Volume Weighted Average Price for that day.

               (b) Additional Consideration. (i) In addition to the consideration to be
delivered pursuant to Section 10.3(a), the Company will also deliver to each
Holder upon conversion of Securities, (x) cash in lieu of any fractional shares
of Common Stock, (y) any accrued and unpaid Contingent Interest on such
Securities (other than for Securities surrendered after a Quarterly Contingent
Interest Record Date and prior to the related Quarterly Contingent Interest
Payment Date, for which Contingent Interest will be paid on such payment date)
and (z) if such conversion is during an Interest Deferral Period, all Deferred
Interest on such Securities.

          (ii) In the event Securities were converted upon the exercise of
conversion rights arising by reason of a notice of redemption or a Change
of Control or distribution described above in Section 10.1(b)(vii), the
Company will deliver to each Holder of Securities in cash the sum of (i)
any accrued and unpaid Stated Interest on such Securities up to but not
including the Conversion Date and (ii) if such redemption or Change of
Control or distribution occurs prior to March 6, 2007, an amount equal to
the Treasury Make-Whole Premium that would have been payable if such
Securities had been redeemed on the Conversion Date.

          (iii) Except as, and only to the extent, described in Section
10.3(b)(ii) above, in the event a Holder surrenders Securities for
conversion during the period after any Interest Record Date but prior to
the corresponding Interest Payment Date, such Holder must pay the Company
at the time of surrender the Stated Interest payable on such Securities
on such Interest Payment Date.

          (iv) The cash, any shares of Common Stock and any other
consideration due (including cash in lieu of fractional shares)
deliverable upon conversion of the Securities will be delivered through
the Conversion Agent as soon as practicable after the last day of the
Conversion Period.

          (v) The delivery by the Company to the Holder of cash (and any other
payments due) and a certificate or certificates for the full number
of shares of Common Stock (or securities into which the Common Stock has
been converted) into which the Securities are convertible, if any, will
be deemed to satisfy the Company’s obligation to pay the Accreted
Principal Amount of, and all accrued and unpaid interest on, and any
other amounts due on, the Securities and all unpaid interest and any
other amounts due will be deemed to be paid in full, rather than
cancelled, extinguished or forfeited. Other than as set forth in this
Section 10.3(b) and Section 10.4, no payment or adjustment will be made
for accrued and unpaid interest, or for dividends or distributions on any
Common Stock, upon conversion of a Security.

          (vi) The Company shall not issue any fraction of a share of Common
Stock in connection with any conversion of Securities, but instead shall,
subject to Section 10.4(j) hereof,

45

 

make a cash payment (calculated to the nearest cent) equal to such
fraction multiplied by the Volume Weighted Average Price for the 10
Trading Days during the Conversion Period.

               (c) Payment Upon Conversion Upon a Change of Control. In the event a
Holder converts its Securities in connection with a Change of Control, such
Holder will receive:

          (i) the consideration described in Section 10.3(a); plus

          (ii) if such Change of Control occurs prior to March 6, 2007, the
Conversion Make-Whole Premium, if any, in an amount and in a form, and
payable on the relevant date, as determined pursuant to Section 10.14;
plus

          (iii) all amounts to which such Holder is entitled pursuant to
Section 10.3(b).

               (d) Conversion After a Public Acquirer Change of Control. Notwithstanding
Section 10.3(c), in the case of a Public Acquirer Change of Control, the
Company may, in substitution of providing the consideration described in
Section 10.3(c), elect to change the Conversion Obligation in connection with
such Public Acquirer Change of Control by providing notice to Holders of such
election (a “Public Acquirer Change of Control Notice”) not less than 3
Business Days nor more than 30 Business Days prior to the effective date of the
relevant Public Acquirer Change of Control. In the event the Company provides
such Public Acquirer Change of Control Notice, from and after the Repurchase
Date, Holders of Securities will be entitled to convert their Securities into
cash and shares of Public Acquirer Common Stock (as defined below) by dividing
the Conversion Price in effect immediately before the Public Acquirer Change of
Control by a fraction:

          (i) the numerator of which will be the average value, for the five
consecutive Trading Days commencing on the Trading Day next succeeding
the effective date of such Change of Control, of all cash and other
consideration (as determined by the Board of Directors) paid or payable
per share of Common Stock in connection with such Public Acquirer Change
of Control, and

          (ii) the denominator of which will be the average of the last
reported Sale Prices of the Public Acquirer Common Stock for the five
consecutive Trading Days commencing on the Trading Day next succeeding
the effective date of such Public Acquirer Change of Control.

               In the event the Company has provided a Public Acquirer Change of Control
Notice, Holders shall, during the time periods for conversion specified under
Section 10.1(b)(vii), have the right to convert their Securities (subject to
satisfaction of the conditions to conversion in Section 10.1), and will be
entitled to receive the Conversion Obligation pursuant to Section 10.3(a), plus
the consideration to which they are entitled pursuant to Section 10.3(b),
provided that such Holders shall not be entitled to receive the Conversion
Make-Whole Premium. In the event the Company has provided a Public Acquirer
Change of Control Notice, any Holder that does not elect to convert its
Securities prior to the applicable Repurchase Date will (unless such Securities
are repurchased on such Repurchase Date) thereafter hold Securities convertible
at any time into cash and shares of Public Acquirer Common Stock, if any, at
the adjusted Conversion Price specified in this Section 10.3(d). On and after
such Repurchase Date, the relevant Public Acquirer Change of Control will not
constitute a Change of Control or Merger Transaction for purposes of
determining the Consideration Per Share.

               A “Public Acquirer Change of Control” means any event constituting a
Change of Control and the acquirer has a class of common stack traded on a U.S.
national securities exchange or

46

 

quoted on the Nasdaq National Market or which will be so traded or quoted
when issued or exchanged in connection with a transaction constituting a Change
of Control (the “Public Acquirer Common Stock”). If an acquirer does not itself
have a class of common stock satisfying the foregoing requirement, it will be
deemed to have “Public Acquirer Common Stock” if either (1) a direct or
indirect majority owned subsidiary of the acquirer or (2) a corporation that
directly or indirectly owns at least a majority of the acquirer, has a class of
common stock satisfying the foregoing requirement. In such case, all references
to Public Acquirer Common Stock shall refer to such class of common stock.
Majority owned for these purposes means having “beneficial ownership” (as
defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended) of
more than 50% of the total voting power of all shares of the respective
entity’s capital stock that are entitled to vote generally in the election of
directors.

               Section 10.4 Adjustments of Conversion Price for Common Stock. The
Conversion Price (the “Conversion Price”) as set forth in paragraph 8 of the
Securities shall be adjusted from time to time as follows:

               (a) Adjustment for Distribution of Common Stock. In case the Company
shall, at any time or from time to time while any of the Securities are
outstanding, pay a dividend or make a distribution in shares of Common Stock to
all holders of its outstanding shares of Common Stock, then the Conversion
Price in effect at the opening of business on the day following the record date
fixed for the determination of stockholders entitled to receive such dividend
or other distribution shall be reduced by multiplying such Conversion Price by
a fraction:

     (1) the numerator of which shall be the number of shares of Common
Stock outstanding at the close of business on the record date fixed for
such determination; and

     (2) the denominator of which shall be the sum of such number of
shares and the total number of shares constituting such dividend or other
distribution.

          Such reduction shall become effective immediately after the opening of
business on the day following the record date fixed for such determination.
If any dividend or distribution of the type described in this Section 10.4(a)
is declared but not so paid or made, the Conversion Price shall again be
adjusted to the Conversion Price which would then be in effect if such
dividend or distribution had not been declared.

               (b) Adjustment for Change in Capital Stock. In case the Company shall, at
any time or from time to time while any of the Securities are outstanding,
subdivide its outstanding shares of Common Stock into a greater number of
shares of Common Stock, then the Conversion Price in effect at the opening of
business on the day following the date upon which such subdivision becomes
effective shall be proportionately reduced, and conversely, in case the Company
shall, at any time or from time to time while any of the Securities are
outstanding, combine its outstanding shares of Common Stock into a smaller
number of shares of Common Stock, then the Conversion Price in effect at the
opening of business on the day following the date upon which such combination
becomes effective shall be proportionately increased.

               Any reduction or increase, as the case may be, of the Conversion Price
as provided in this clause (b), shall become effective immediately after the
opening of business on the day following the day upon which such subdivision
or combination becomes effective.

               (c) Adjustment for Rights Issue. In case the Company shall, at any time or
from time to time while any of the Securities are outstanding, distribute
rights or warrants to all holders of its shares of Common Stock entitling them
to purchase shares of Common Stock (or securities convertible into shares

47

 

of Common Stock) at a price per share (or having a conversion price per
share) less than the Current Market Price of the Common Stock on the Trading
Day immediately preceding the date of the declaration of such distribution
(treating the conversion price per share of such securities convertible into
Common Stock as equal to (x) the sum of (i) the price for a unit of the
security convertible into Common Stock and (ii) any additional consideration
initially payable upon the conversion of such security into Common Stock
divided by (y) the number of shares of Common Stock initially underlying such
convertible security), then the Conversion Price shall be adjusted so that the
same shall equal the price determined by multiplying the Conversion Price in
effect at the opening of business on the day after the record date for such
distribution by a fraction:

     (1) the numerator of which shall be the number of shares of Common
Stock outstanding on the close of business on the record date for such
distribution, plus the number of shares which the aggregate offering
price of the total number of shares so offered for subscription or
purchase (or the aggregate conversion price of the convertible securities
so offered) would purchase at the Current Market Price of the Common
Stock as of the Business Day immediately preceding the date of the
declaration of such distribution; and

     (2) the denominator of which shall be the number of shares of Common
Stock outstanding at the close of business on the record date for such
distribution, plus the total number of additional shares of Common Stock
so offered for subscription or purchase (or into which the convertible
securities so offered are convertible).

          Such adjustment shall become effective immediately after the opening of
business on the day following the record date for the determination of the
stockholders entitled to receive such rights or warrants. To the extent that
shares of Common Stock (or securities convertible into shares of Common
Stock) are not delivered pursuant to such rights or warrants, upon the
expiration or termination of such rights or warrants, the Conversion Price
shall be readjusted to the Conversion Price which would then be in effect had
the adjustments made upon the distribution of such rights or warrants been
made on the basis of the delivery of only the number of shares of Common
Stock (or securities convertible into shares of Common Stock) actually
delivered. In the event that such rights or warrants are not so issued, the
Conversion Price shall again be adjusted to be the Conversion Price which
would then be in effect if the date fixed for the determination of
stockholders entitled to receive such rights or warrants had not been fixed.
In determining whether any rights or warrants entitle the holders to
subscribe for or purchase shares of Common Stock at less than such Current
Market Price, and in determining the aggregate offering price of such shares
of Common Stock, there shall be taken into account any consideration received
for such rights or warrants, the value of such consideration if other than
cash, to be determined by the Board of Directors.

          No adjustment shall be made under this Section 10.4(c) if (i) the
application of the formula stated above in this Section 10.4(c) would result
in the Conversion Price effective subsequent to such adjustment to be equal
to or more than the Conversion Price in effect immediately prior to such
adjustment or (ii) such distribution of rights or warrants as described in
the first paragraph of this Section 10.4(c) is made pursuant to the
implementation of a Rights Plan and the provisions set forth in the last
paragraph of Section 10.4(d)(i) below are complied with.

               (d) Adjustment for Other Distributions. (i) Adjustment for Extraordinary
Distributions. In case the Company shall, at any time or from time to time
while any of the Securities are outstanding, by dividend or otherwise,
distribute to all holders of its shares of Common Stock (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing corporation and the Common Stock is not changed or
exchanged), cash, debt securities (or other evidence of its indebtedness) or
other assets, excluding:

48

 

	 	•	 	any dividends or distributions to which Section 10.4(a), 10.4(c) or 10.4(d)(ii) applies,
	 
	 	•	 	any distribution of rights pursuant to the adoption of a stockholder rights plan, and
	 
	 	•	 	dividends that result in Contingent Interest becoming payable in
accordance with paragraph 1 of the Securities (such cash, debt
securities or other evidence of indebtedness) or other assets being
distributed hereinafter in this Section 10.4(d) called the
“distributed assets”)

then, in each such case, subject to Section 10.4(l), the Conversion Price
shall be adjusted so that the same shall be equal to the price determined by
multiplying the Conversion Price in effect immediately prior to the opening
of business on the day after the record date for the determination of
stockholders entitled to receive such distributed assets by a fraction:

     (1) the numerator of which shall be the Current Market Price of the
Common Stock on such record date for the distribution, less the Fair
Market Value on such record date of the portion of the distributed assets
so distributed attributable to one share of Common Stock (determined on
the basis of the number of shares of Common Stock outstanding on such
record date as provided in Section 10.4(g)) on such record date; and

     (2) the denominator of which shall be such Current Market Price.

          Such reduction shall become effective immediately prior to the opening
of business on the day following the record date for such distribution. In
the event that such dividend or distribution is not so paid or made, the
Conversion Price shall again be adjusted to be the Conversion Price which
would then be in effect if such dividend or distribution had not been
declared.

          In the event that (x) the difference between the Current Market Price of
the Common Stock and the Fair Market Value of the portion of the distributed
assets attributable to one share of Common Stock referred to in (1) above is
less than $1.00, or (y) the Fair Market Value of the portion of the
distributed assets attributable to one share of Common Stock is equal to or
greater than the Current Market Price of the Common Stock on the record date
for the determination of stockholders entitled to receive such distributed
assets, in lieu of the foregoing adjustment, adequate provision may be made
so that each Holder shall have the right to receive upon conversion of a
Security the amount of distributed assets such Holder would have received had
such Holder converted such Security on such record date.

          If the Board of Directors determines the Fair Market Value of any
distribution for purposes of this Section 10.4(d) by reference to the actual
or when issued trading market for any distributed assets comprising all or
part of such distribution, it must in doing so consider the prices in such
market over the same period (the “Reference Period”) used in computing the
Current Market Price pursuant to Section 10.4(g) to the extent possible,
unless the Board of Directors determines in good faith that determining the
Fair Market Value during the Reference Period would not be in the best
interest of the Holders.

          In the event that the Company implements a preferred shares rights plan
(“Rights Plan”), upon conversion of the Securities into cash and Common
Stock, to the extent that the Rights Plan has been implemented and is still
in effect upon such conversion, Holders of Securities will receive, in
addition to the Common Stock, the rights described therein (whether or not
the rights have separated from the Common Stock at the time of conversion),
subject to the limitations set forth in the Rights Plan. Provided that such
Rights Plan requires that each share of Common Stock issued upon conversion
of Securities at any time prior to the distribution of separate certificates
representing the

49

 

rights provided under such Rights Plan be entitled to receive such
rights, then, notwithstanding anything else to the contrary in this Section
10.4, there shall not be any adjustment to the conversion privilege or
Conversion Price as a result of the issuance of rights, the distribution of
separate certificates representing the rights, the exercise or redemption of
such rights in accordance with any such Rights Agreement, or the termination
or invalidation of such rights.

     (ii) Adjustment for Distribution of Subsidiary Stock. If, after the date
of this Indenture, the Company pays a dividend or makes a distribution to all
holders of its Common Stock consisting of Capital Stock of any class or
series, or similar equity interests, of or relating to a Subsidiary or other
business unit of the Company, the Conversion Price shall be adjusted by
multiplying the Conversion Price in effect immediately prior to the opening
of business on the day after the conclusion of the 10 Trading-Day period
referred to in the following paragraph by a fraction:

     (1) the numerator of which shall be one; and

     (2) the denominator of which shall be one, plus a fraction the
numerator of which shall be the Fair Market Value of the securities
distributed in respect of each share of Common Stock and the denominator
of which shall be the average of the Post Distribution Prices of the
Common Stock for the 10 Trading Days commencing on and including the
fifth Trading Day after the date of the Ex-Dividend Time for such
dividend or distribution.

               For the purposes of this Section 10.4(d)(ii), the Fair Market Value of the
securities distributed in respect of each share of Common Stock shall mean the
number of securities distributed in respect of each share of Common Stock
multiplied by the average of the Post-Distribution Prices of those securities
distributed for the 10 Trading Days commencing on and including the fifth
Trading Day after the Ex-Dividend Time.

               “Post-Distribution Price” of the Capital Stock or any similar equity
interest on any date means the closing per unit sale price (or, if no closing
sale price is reported, the average of the bid and ask prices or, if more than
one in either case, the average of the average bid and the average ask prices)
on such date for trading of such units on a “when issued” basis without due
bills (or similar concept) as reported in the composite transactions for the
principal United States securities exchange on which such Capital Stock or
equity interest is traded or, if the Capital Stock or equity interest, as the
case may be, is not listed on a United States national or regional securities
exchange, as reported by the National Association of Securities Dealers
Automated Quotation System or by the National Quotation Bureau Incorporated;
provided that if on any date such units have not traded on a “when issued”
basis, the Post-Distribution Price shall be the closing per unit sale price
(or, if no closing sale price is reported, the average of the bid and ask
prices or, if more than one in either case, the average of the average bid and
the average ask prices) on such date for trading of such units on a “regular
way” basis without due bills (or similar concept) as reported in the composite
transactions for the principal United States securities exchange on which such
Capital Stock or equity interest is traded or, if the Capital Stock or equity
interest, as the case may be, is not listed on a United States national or
regional securities exchange, as reported by the National Association of
Securities Dealers Automated Quotation System or by the National Quotation
Bureau Incorporated. In the absence of such quotation, the Company shall be
entitled to determine the Post-Distribution Price on the basis of such
quotations which reflect the post-distribution value of the Capital Stock or
equity interests as it considers appropriate.

               (e) Provisions Applicable to Certain Conversion Price Adjustments. Rights
or warrants distributed by the Company to all holders of its shares of Common
Stock entitling them to subscribe for or purchase shares of Capital Stock
(either initially or under certain circumstances), which rights or warrants,
until the occurrence of a specified event or events (“Trigger Event”), (i) are
deemed to be

50

 

transferred with such shares of Common Stock, (ii) are not exercisable and
(iii) are also issued in respect of future issuances of shares of Common Stock
shall be deemed not to have been distributed for purposes of Section 10.4(d)
(and no adjustment to the Conversion Price under Section 10.4(d) will be
required) until the occurrence of the earliest Trigger Event, whereupon such
rights and warrants shall be deemed distributed and an appropriate adjustment
(if required) to the Conversion Price shall be made pursuant to Section
10.4(d). If such right or warrant is subject to subsequent events, upon the
occurrence of which such right or warrant shall become exercisable to purchase
different distributed assets, or entitle the holder to purchase a different
number or amount of distributed assets or to purchase any distributed assets at
a different purchase price, then the occurrence of each such event shall be
deemed to be the date of issuance and record date with respect to a new right
or warrant with such rights (and a termination or expiration of the existing
rights or warrants without exercise by the holder thereof). In addition, in the
event of any distribution (or deemed distribution) of rights or warrants, or
any Trigger Event or other event (of the type described in the preceding
sentence) with respect thereto, that resulted in an adjustment to the
Conversion Price under Section 10.4(d):

     (1) in the case of any such rights or warrants which shall all have
been redeemed or repurchased without exercise by any holders thereof, the
Conversion Price shall be readjusted upon such final redemption or
repurchase to give effect to such distribution or Trigger Event, as the
case may be, as though it were a cash distribution, equal to the per
share redemption or repurchase price received by a holder of shares of
Common Stock with respect to such rights or warrants (assuming such
holder had retained such rights or warrants), made to all holders of
shares of Common Stock as of the date of such redemption or repurchase;
and

     (2) in the case of such rights or warrants which shall have expired
or been terminated without exercise, the Conversion Price shall be
readjusted as if such rights and warrants had never been issued.

               For purposes of Sections 10.4(a), 10.4(c) and 10.4(d), any dividend or
distribution to which Section 10.4(d) is applicable that also includes (i)
shares of Common Stock (or securities convertible into Common Stock) to which
Section 10.4(a) applies or (ii) rights or warrants to subscribe for or purchase
shares of Common Stock (or securities convertible into Common Stock) to which
Section 10.4(c) applies (or any combination thereof), shall be deemed instead
to be:

     (1) a dividend or distribution of cash, debt securities (or other
evidences of indebtedness), assets, shares of capital stock, rights or
warrants, other than such shares of Common Stock, or such rights or
warrants to which Sections 10.4(a) and 10.4(c) apply, respectively (and
any Conversion Price reduction required by Section 10.4(d) with respect
to such dividend or distribution shall then be made), immediately
followed by

     (2) a dividend or distribution of such shares of Common Stock or
such rights or warrants (and any further Conversion Price reduction
required by Sections 10.4(a) and 10.4(c) with respect to such dividend or
distribution shall then be made), except:

     (A) the record date of such dividend or distribution shall be
substituted as (i) “record date fixed for the determination of
stockholders entitled to receive such dividend or other
distribution,” “record date fixed for such determination” and
“record date” within the meaning of Section 10.4(a), and (ii) as
“the date fixed for the determination of stockholders entitled to
receive such rights or warrants,” “the record date fixed for the
determination of the stockholders entitled to receive such rights
or warrants” and such “record date” within the meaning of Section
10.4(c); and

51

 

     (B) any shares of Common Stock included in such dividend or
distribution shall not be deemed “outstanding at the close of
business on the record date fixed for such determination” within
the meaning of Section 10.4(a).

               In the event of any distribution referred to in Section 10.4(c) or
10.4(d), where, in the case of a distribution described in Section 10.4(d), the
Fair Market Value of such distribution per share of Common Stock (as determined
by the Board of Directors) exceeds 15% of the Current Market Price of a share
of Common Stock on the Trading Day immediately preceding the declaration date
for such distribution, then, if such distribution would also trigger a
conversion right under Section 10.1(b)(vii) or the Securities are otherwise
convertible pursuant to this Article 10, the Company will be required to give
notice to the Holders of Securities at least 20 days prior to the Ex-Dividend
Time for the distribution and, upon the giving of notice, the Securities may be
surrendered for conversion at any time on and after the date that the Company
gives notice to the Holders of such conversion right, until the close of
business on the Business Day prior to the Ex-Dividend Time or the Company
announces that such distribution will not take place.

               (f) Adjustment for Tender Offer. In the event that a tender offer (other
than an odd-lot offer) made by the Company or any of its Subsidiaries for all
or any portion of the shares of Common Stock shall expire and such tender offer
(including any amendment in effect immediately prior to the expiration thereof)
shall require the payment to stockholders (based on the acceptance of shares
tendered up to any maximum specified in the terms of the tender offer) of an
aggregate consideration having a Fair Market Value in excess of 110% of the
Current Market Price of the Common Stock as of close of business on the last
date that tenders may be made pursuant to such offer (the “Expiration Time”),
the Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the close of business on the date of the Expiration Time by a fraction:

     (1) the numerator of which shall be the number of shares of Common
Stock outstanding (including any tendered or exchanged shares) at the
Expiration Time multiplied by the Current Market Price of the Common
Stock as of the Expiration Time, and

     (2) the denominator of which shall be the sum of (x) the Fair Market
Value of the aggregate consideration payable to holders of Common Stock
based on the acceptance of all shares validly tendered and not withdrawn
as of the Expiration Time, up to the maximum specified in the tender (the
shares of Common Stock so accepted being the “Purchased Shares”) and (y)
the product of the number of shares of Common Stock outstanding as of the
date of the Expiration Time (less any Purchased Shares) and the Current
Market Price of the Common Stock as of the Expiration Time.

               Such reduction (if any) shall become effective immediately prior to the
opening of business on the day following the Expiration Time. In the event that
the Company, or its Subsidiaries, as the case may be, is obligated to purchase
shares of Common Stock pursuant to any such tender offer, but the Company, or
its Subsidiaries, as the case may be, is permanently prevented by applicable
law from effecting any such purchases or all or a portion of such purchases are
rescinded, the Conversion Price shall again be adjusted to be the Conversion
Price which would then be in effect if such (or such portion of the) tender
offer had not been made. If the application of this Section 10.4(f) to any
tender offer would result in an increase in the Conversion Price, no adjustment
shall be made for such tender offer under this Section 10.4(f).

               (g) For purposes of this Article 10, the following terms shall have the
meanings indicated:

52

 

          “Current Market Price” on any date means the average of the daily Sale
Prices per share of Common Stock for the 10 consecutive Trading Days
immediately prior to such date (referred to below as the “price determination
date”); provided, however, that whenever successive adjustments to the
Conversion Price are called for pursuant to this Section 10.4, such
adjustments shall be made to the Current Market Price as may be necessary or
appropriate to effectuate the intent of this Section 10.4 and to avoid unjust
or inequitable results as determined in good faith by the Board of Directors;

          “Fair Market Value” shall mean the amount which a willing buyer would
pay a willing seller in an arm’s length transaction (as determined in good
faith by the Board of Directors, whose determination shall be conclusive);
and

          “record date” shall mean, with respect to any dividend, distribution or
other transaction or event in which the holders of shares of Common Stock
have the right to receive any cash, securities or other property or in which
the shares of Common Stock (or other applicable securities) are exchanged for
or converted into any combination of cash, securities or other property, the
date fixed for determination of stockholders entitled to receive such cash,
securities or other property (whether such date is fixed by the Board of
Directors or by statute, contract or otherwise).

               (h) To the extent permitted by applicable law, the Company may, from time
to time, reduce the Conversion Price by any amount for any period of time, if
such period is at least 20 days and the reduction is irrevocable during the
period. Whenever the Conversion Price is reduced pursuant to the preceding
sentence, the Company shall mail to the Trustee and each Holder at the address
of such Holder as it appears in the register of the Securities maintained by
the Registrar, at least 15 days prior to the date the reduced Conversion Price
takes effect, a notice of the reduction stating the reduced Conversion Price
and the period during which it will be in effect.

               (i) In any case in which this Section 10.4 shall require that any
adjustment be made effective as of or retroactively immediately following a
record date, the Company may elect to defer (but only for five Trading Days
following the filing of the statement referred to in Section 10.6) issuing to
the Holder of any Securities converted after such record date the shares of
Common Stock issuable upon such conversion over and above the shares of Common
Stock issuable upon such conversion on the basis of the Conversion Price prior
to adjustment; provided, however, that the Company shall deliver to such Holder
a due bill or other appropriate instrument evidencing such Holder’s right to
receive such additional shares upon the occurrence of the event requiring such
adjustment.

               (j) All calculations under this Section 10.4 shall be made to the nearest
cent or one-hundredth of a share, with one-half cent and 0.005 of a share,
respectively, being rounded upward. Notwithstanding any other provision of this
Section 10.4, the Company shall not be required to make any adjustment of the
Conversion Price unless such adjustment would require an increase or decrease
of at least 1% of such price. Any lesser adjustment shall be carried forward
and shall be made at the time of and together with the next subsequent
adjustment which, together with any adjustment or adjustments so carried
forward, shall amount to an increase or decrease of at least 1% in such price.
Any adjustments under this Section 10.4 shall be made successively whenever an
event requiring such an adjustment occurs.

               (k) In the event that at any time, as a result of an adjustment made
pursuant to this Section 10.4, the Holder of any Securities thereafter
surrendered for conversion shall become entitled to receive any shares of stock
of the Company other than shares of Common Stock into which the Securities
originally were convertible, the Conversion Price of such other shares so
receivable upon conversion of any such Securities shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to Common Stock contained in
subparagraphs (a)

53

 

through (j) of this Section 10.4, and the provisions of Sections 10.1,
10.2 and 10.5 through 10.9 with respect to the Common Stock shall apply on like
or similar terms to any such other shares and the determination of the Board of
Directors as to any such adjustment shall be conclusive.

               (l) No adjustment shall be made pursuant to this Section 10.4 (i) if the
effect thereof would be to reduce the Conversion Price below the par value (if
any) of the Common Stock or (ii) if the Holders of the Securities may
participate in the transaction that would otherwise give rise to an adjustment
pursuant to this Section 10.4. No adjustment need be made for a transaction
referred to in clauses (a), (b), (c), (d), (e) or (f) of this Section 10.4 if
Holders are to participate in the transaction on a basis and with notice that
the Board of Directors determines to be fair and appropriate in light of the
basis and notice on which holders of Common Stock participate in the
transaction. Such participation by Holders may include participation upon
conversion, provided that an adjustment shall be made at such time as the
Holders are no longer entitled to participate. No adjustment need be made for a
change in the par value or no par value of the Common Stock. To the extent the
Securities become convertible pursuant to this Article 10 into cash, no
adjustment need be made thereafter as to the cash. Interest will not accrue on
such cash.

               (m) In the event of a Public Acquirer Change of Control for which the
Company has provided a Public Acquirer Change of Control Notice following the
applicable Repurchase Date, the Conversion Price is subject to adjustment
pursuant to Section 10.3(d).

               Section 10.5 Consolidation or Merger of the Company. If any of the
following events occurs (each, a “Merger Transaction”), namely:

               (a) any reclassification or change of the outstanding Common Stock (other
than a change in par value, or from par value to no par value, or from no par
value to par value, or as a result of a subdivision or combination);

               (b) any merger, consolidation, statutory share exchange or combination of
the Company with another corporation as a result of which holders of Common
Stock shall be entitled to receive stock, securities or other property or
assets (including cash) with respect to or in exchange for such Common Stock;
or

               (c) any sale, conveyance or lease of the properties and assets of the
Company as, or substantially as, an entirety to any other corporation as a
result of which holders of Common Stock shall be entitled to receive stock,
securities or other property or assets (including cash) with respect to or in
exchange for such Common Stock;

the Company or the successor or purchasing corporation, as the case may be,
shall execute with the Trustee a supplemental indenture (which shall comply
with the Trust Indenture Act as in force at the date of execution of such
supplemental indenture, if such supplemental indenture is then required to so
comply) providing that such Securities shall be convertible into such cash,
securities and other property in accordance with such applicable provisions as
set forth in Section 10.3; provided that, if the kind or amount of securities,
cash or other property receivable upon such Merger Transaction is not the same
for each share of Common Stock in respect of which such rights of election
shall not have been exercised (“Non Electing Share”), then for the purposes of
this Section 10.5, the kind and amount of securities, cash or other property
receivable upon such Merger Transaction for each Non Electing Share shall be
deemed to be the kind and amount so receivable per share by a plurality of the
Non Electing Shares.

54

 

               Such supplemental indenture shall provide for adjustments which shall be
as nearly equivalent as may be practicable to the adjustments provided for in
this Article 10. If, in the case of any such reclassification, change, merger,
consolidation, statutory share exchange, combination, sale or conveyance, the
stock or other securities and assets receivable thereupon by a holder of Common
Stock includes shares of stock or other securities and assets of a corporation
other than the successor or purchasing corporation, as the case may be, in such
reclassification, change, merger, consolidation, statutory share exchange,
combination, sale or conveyance, then such supplemental indenture shall also be
executed by such other corporation and shall contain such additional provisions
to protect the interests of the Holders of the Securities as the Board of
Directors shall reasonably consider necessary by reason of the foregoing,
including to the extent practicable the provisions providing for the repurchase
rights set forth in Article 10 hereof.

               The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each Holder, at the address of such Holder as it
appears on the register of the Securities maintained by the Registrar, within
20 days after execution thereof. Failure to deliver such notice shall not
affect the legality or validity of such supplemental indenture.

               The above provisions of this Section 10.5 shall similarly apply to
successive reclassifications, mergers, consolidations, statutory share
exchanges, combinations, sales and conveyances.

               If this Section 10.5 applies to any event or occurrence, Section 10.4
shall not apply.

               Section 10.6 Notice of Adjustment. Whenever an adjustment in the
Conversion Price with respect to the Securities is required:

               (a) the Company shall forthwith place on file with the Trustee and any
Conversion Agent for such securities a certificate of the Treasurer of the
Company, stating the adjusted Conversion Price determined as provided herein
and setting forth in reasonable detail such facts as shall be necessary to show
the reason for and the manner of computing such adjustment; and

               (b) a notice stating that the Conversion Price has been adjusted and
setting forth the adjusted Conversion Price shall forthwith be given by the
Company or, at the Company’s written request, by the Trustee in the name and at
the expense of the Company, to each Holder in the manner provided in Section
12.2. Any notice so given shall be conclusively presumed to have been duly
given, whether or not the Holder receives such notice.

               Section 10.7 Notice in Certain Events. In case:

               (a) of a consolidation or merger to which the Company is a party and for
which approval of any stockholders of the Company is required, or of the sale
or conveyance to another Person or entity or group of Persons or entities
acting in concert as a partnership, limited partnership, syndicate or other
group (within the meaning of Rule 13d-3 under the Exchange Act) of all or
substantially all of the property and assets of the Company;

               (b) of the voluntary or involuntary dissolution, liquidation or winding-up
of the Company; or

               (c) of any action triggering an adjustment of the Conversion Price
referred to in clause (x) or (y) below;

55

 

then, in each case, the Company shall cause to be filed with the Trustee and
the Conversion Agent, and shall cause to be given, to the Holders of the
Securities in the manner provided in Section 12.2, at least 15 days prior to
the applicable date hereinafter specified, a notice stating (x) the date on
which a record is to be taken for the purpose of any distribution or grant of
rights or warrants triggering an adjustment to the Conversion Price pursuant to
this Article 10, or, if a record is not to be taken, the date as of which the
holders of record of Common Stock entitled to such distribution, rights or
warrants are to be determined, or (y) the date on which any reclassification,
consolidation, merger, sale, conveyance, dissolution, liquidation or winding-up
triggering an adjustment to the Conversion Price pursuant to this Article 10 is
expected to become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their Common
Stock for securities or other property deliverable upon such reclassification,
consolidation, merger, sale, conveyance, dissolution, liquidation or
winding-up.

               Failure to give such notice or any defect therein shall not affect the
legality or validity of the proceedings described in clause (a), (b) or (c) of
this Section 10.7.

               Section 10.8 Company to Reserve Stock; Registration; Listing. The
Company shall, in accordance with the laws of the State of Iowa, at all times
reserve and keep available, free from preemptive rights, out of a combination
of its authorized but unissued shares of Common Stock or its purchased shares
of Common Stock which are then held in the treasury of the Company, for the
purpose of effecting the conversion of the Securities, such number of its duly
authorized shares of Common Stock as shall from time to time be sufficient to
effect the conversion of all Securities then outstanding into such Common Stock
at any time (assuming that, at the time of the computation of such number of
shares or securities, all such Securities would be held by a single Holder).
The Company covenants that all shares of Common Stock which may be issued upon
conversion of Securities will upon issue be fully paid and nonassessable and
free from all liens and charges and, except as provided in Section 10.9, taxes
with respect to the issue thereof.

               (b) If any shares of Common Stock which would be issuable upon conversion
of Securities hereunder require registration with or approval of any
governmental authority before such shares or securities may be issued upon such
conversion, the Company will in good faith and as expeditiously as possible
endeavor to cause such shares or securities to be duly registered or approved,
as the case may be. The Company further covenants that so long as the Common
Stock shall be listed on the New York Stock Exchange, the Company will, if
permitted by the rules of such exchange, list and keep listed all Common Stock
issuable upon conversion of the Securities, and the Company will endeavor to
list the shares of Common Stock required to be delivered upon conversion of the
Securities prior to such delivery upon any other national securities exchange
upon which the outstanding Common Stock is listed at the time of such delivery.

               Section 10.9 Taxes on Conversion. The issue of stock certificates, if any,
on conversion of Securities shall be made without charge to the converting
Holder for any documentary, stamp or similar issue or transfer taxes in respect
of the issue thereof, and the Company shall pay any and all documentary, stamp
or similar issue or transfer taxes that may be payable in respect of the issue
or delivery of shares of Common Stock on conversion of Securities pursuant
hereto. The Company shall not, however, be required to pay any such tax which
may be payable in respect of any transfer involved in the issue or delivery of
shares of Common Stock or the portion, if any, of the Securities which are not
so converted in a name other than that in which the Securities so converted
were registered, and no such issue or delivery shall be made unless and until
the Person requesting such issue has paid to the Company the amount of such tax
or has established to the satisfaction of the Company that such tax has been
paid.

               Section 10.10 Securities Deemed Paid in Full on Conversion. If at least
one of the conditions for conversion specified in Section 10.1(b) is satisfied,
Holders may convert their Securities or

56

 

any portion thereof in $1,000 original principal amount or an integral
multiple thereof into cash and shares of Common Stock, if any, in accordance
with this Article 10 and paragraph 8 of the Securities. Upon delivery to the
Holder of cash and a certificate or certificates representing (or, as the case
may be, book entry transfer to the Holder of) the number of shares of Common
Stock issuable, if any, and any other consideration (if any) payable or
otherwise required to be delivered, upon conversion in accordance with this
Article 10 and paragraph 8 of the Securities, the Accreted Principal Amount of
the Securities and all accrued and unpaid interest on such Securities will be
deemed to have been paid in full, rather than cancelled, extinguished or
forfeited.

               Except as provided in this Indenture, no adjustments in respect of
payments of interest on Securities surrendered for conversion or any dividends
or distributions or interest on the Common Stock issued upon conversion shall
be made upon the conversion of any Securities.

               Section 10.11 Company Determination Final. Any determination that the
Company or the Board of Directors must make pursuant to this Article 10 shall
be conclusive if made in good faith and in accordance with the provisions of
this Article 10, absent manifest error, and set forth in a Board Resolution.

               Section 10.12 Responsibility of Trustee for Conversion Provisions. The
Trustee has no duty to determine when an adjustment under this Article 10
should be made, how it should be made or what it should be. The Trustee makes
no representation as to the validity or value of any securities or assets
issued upon conversion of Securities. The Trustee shall not be responsible for
any failure of the Company to comply with this Article 10. Each Conversion
Agent other than the Company shall have the same protection under this Section
10.12 as the Trustee.

               The rights, privileges, protections, immunities and benefits given to the
Trustee under this Indenture including, without limitation, its rights to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and each Paying Agent or Conversion Agent acting
hereunder.

               Section 10.13 Unconditional Right of Holders to Convert. Notwithstanding
any other provision in this Indenture, the Holder of any Security shall have
the right, which is absolute and unconditional, to convert its Security in
accordance with this Article 10 and to bring an action for the enforcement of
any such right to convert, and such rights shall not be impaired or affected
without the consent of such Holder.

               Section 10.14
Calculation of Conversion Make-Whole Premium. If a Change
of Control occurs prior to March 6, 2007, the Conversion Make-Whole Premium
shall be determined by reference to the following table and shall be based on
the effective date of such Change of Control, and the price (the “Stock
Price”), paid, or deemed to be paid, per share of Common Stock in the
transaction constituting such Change of Control, such Stock Price subject to
adjustment as described below in this Section 10.14. In the event holders of
Common Stock receive only cash in the Change of Control transaction, the Stock
Price shall be the cash amount paid per share. In all other cases, the Stock
Price shall be the average Sale Price of Common Stock for the 10 Trading Days
immediately prior to but not including the effective date of the Change of
Control. No Conversion Make-Whole Premium shall exist if the event or
transaction that would require the Conversion Make-Whole Premium to be
calculated is in connection with a Change of Control occurring on or after
March 6, 2007.

               The Conversion Make-Whole Premium shall be payable solely in shares of
Common Stock or in the same form, and in the same proportion, of consideration
into which all or substantially all

57

 

of the shares of Common Stock have been converted or exchanged in
connection with the Change of Control; provided that, in each case, the Company
shall pay cash in lieu of fractional shares. If holders of Common Stock receive
or have the right to receive more than one form of consideration in connection
with such Change of Control, then, for purposes of the foregoing, the forms of
consideration in which the Conversion Make-Whole Premium will be paid shall be
in proportion to the different forms of consideration paid to holders of Common
Stock in connection with such Change of Control. The Conversion Make-Whole
Premium shall be payable on the Repurchase Date, whether for Securities
converted, redeemed or tendered for repurchase in connection with a Change of
Control. No Conversion Make-Whole Premium shall be payable if the Company has
provided a Public Acquirer Change of Control Notice pursuant to Section
10.3(d).

               (b) The value of shares or other consideration for purposes of determining
the number of shares or other consideration to be issued in respect of the
Conversion Make -Whole Premium shall be calculated as follows:

     (i) In the case of a Change of Control in which all or substantially
all of the shares of Common Stock have been, as of the effective date,
converted into or exchanged for the right to receive securities or other
assets or property, then the consideration shall be valued as follows:

     (1) securities that are traded on a U.S. national securities
exchange or approved for quotation on Nasdaq National Market or any
similar system of automated dissemination of quotations of securities
prices shall be valued at 98% of the average Sale Price for the 10
Trading Days immediately prior to but excluding the Change of Control
Repurchase Date;

     (2) other securities, assets or property, other than cash, that
holders will have the right to receive shall be valued based on 98% of
the average of the fair market value of such securities, assets or
property, other than cash, as determined by two independent nationally
recognized investment banks selected by the Trustee; and

     (3) 100% of any cash.

     (ii) In all other cases, the value of the Common Stock shall equal
98% of the average of the Sale Price of the Common Stock for the 10
Trading Days immediately prior to, but excluding, the Change of Control
Repurchase Date.

               (c) The stock prices set forth in the first column of the following table
shall be adjusted as of any date on which the Conversation Price of the
Securities is adjusted. The adjusted Stock Prices will equal the Stock Prices
applicable immediately prior to such adjustment multiplied by a fraction, the
numerator of which shall be the conversion price immediately prior to the
adjustment giving rise to the stock price adjustment and the denominator of
which shall be the conversion price as so adjusted.

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     The following table sets forth Conversion Make-Whole Premiums (table in
percentages):

Effective Date

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	September 6,	 	March 6,	 	September 6,	 	March 6,	 	September 6,	 	March 6,
	Stock Price	 	2004	 	2005	 	2005	 	2006	 	2006	 	2007
	$34.18
	 	 	4.8	%	 	 	3.8	%	 	 	2.9	%	 	 	2.0	%	 	 	1.0	%	 	 	0.0	%
	$36.68
	 	 	5.1	%	 	 	4.1	%	 	 	3.1	%	 	 	2.1	%	 	 	1.1	%	 	 	0.0	%
	$39.18
	 	 	5.5	%	 	 	4.4	%	 	 	3.3	%	 	 	2.2	%	 	 	1.1	%	 	 	0.0	%
	$41.68
	 	 	5.8	%	 	 	4.7	%	 	 	3.5	%	 	 	2.4	%	 	 	1.2	%	 	 	0.0	%
	$44.18
	 	 	6.2	%	 	 	5.0	%	 	 	3.8	%	 	 	2.5	%	 	 	1.3	%	 	 	0.0	%
	$47.85
	 	 	6.7	%	 	 	5.4	%	 	 	4.1	%	 	 	2.7	%	 	 	1.4	%	 	 	0.0	%
	$50.24
	 	 	5.3	%	 	 	4.3	%	 	 	3.3	%	 	 	2.2	%	 	 	1.1	%	 	 	0.0	%
	$52.64
	 	 	4.0	%	 	 	3.2	%	 	 	2.4	%	 	 	1.6	%	 	 	0.8	%	 	 	0.0	%
	$55.03
	 	 	2.7	%	 	 	2.2	%	 	 	1.6	%	 	 	1.1	%	 	 	0.6	%	 	 	0.0	%
	$57.42
	 	 	1.3	%	 	 	1.1	%	 	 	0.8	%	 	 	0.5	%	 	 	0.3	%	 	 	0.0	%
	$59.82
	 	 	0.0	%	 	 	0.0	%	 	 	0.0	%	 	 	0.0	%	 	 	0.0	%	 	 	0.0	%

     In the event the Stock Price is between two stock prices on the table or
the effective date is between two effective dates on the table, the Conversion
Make-Whole Premium shall be determined by straight-line interpolation between
Conversion Make-Whole Premium amounts set forth for the higher and lower stock
prices and the two effective dates, as applicable, based on a 365 day year. In
the event the Stock Price is less than or equal to the Initial Stock Price
(such price subject to adjustment in the same manner as the Stock Price), no
Conversion Make-Whole Premium shall be paid. In the event the Stock Price is
greater than or equal to $59.82 per share (such price subject to adjustment in
the same manner as the Stock Price), no Conversion Make-Whole Premium shall be
paid.

ARTICLE 11

SUBORDINATION OF SECURITIES

               Section 11.1 Securities Subordinate to Senior Debt. The Company
covenants and agrees, and each Holder of a Security, by its acceptance thereof,
likewise covenants and agrees, that, to the extent and in the manner
hereinafter set forth in this Article 11, the payment of the principal of and
premium (if any), the cash portion and any other non-Common Stock portion of
the Conversion Obligation (if any), and interest (including Stated Interest,
Contingent Interest and Deferred Interest) on each and all of the Securities
are hereby expressly made subordinate and subject in right of payment to the
prior payment in full of all amounts then due and payable in respect of all
Senior Debt.

               The Trustee and the Holders shall take such action (including, without
limitation, the delivery of this Indenture to an agent for the holders of
Senior Debt or consent to the filing of a financing statement with respect
hereto) as may, in the opinion of counsel designated by the holders of a
majority in principal amount of the Senior Debt at the time outstanding, be
necessary or appropriate to assure the effectiveness of the subordination
effected by these provisions.

               (b) The provisions of Sections 11.2, 11.3 and 11.4 shall not impair any
rights, interests, remedies or powers of any secured creditor of the Company in
respect of any security interest the creation of which is not prohibited by the
provisions of this Indenture.

59

 

     The securing of any obligations of the Company, otherwise ranking on a
parity with the Securities or ranking junior to the Securities, shall not be
deemed to prevent such obligations from constituting, respectively, obligations
ranking on a parity with the Securities or ranking junior to the Securities.

               (c) Securities Senior to Junior Subordinated Debt. The Company covenants
and agrees that the payment of the principal of and premium (if any) and
interest on the 8.85% Junior Subordinated Debentures, Series A, issued pursuant
to the indenture dated February 3, 1997 between AmerUs Life Holdings, Inc. and
Wilmington Trust Company and the guarantee issued by AmerUs Life Holdings, Inc.
in connection with the 8.85% Capital Securities, Series A issued by AmerUs
Capital I are hereby expressly made subordinate and subject in right of payment
to the prior payment in full of all amounts then due and payable in respect of
the Securities.

               (d) Limitation on Senior Subordinated Debt. The Company shall not incur
any Debt that is expressly made subordinate in right of payment to any of its
Senior Debt unless such Debt, by its terms or by the terms of any agreement or
instrument pursuant to which such Debt is outstanding, is expressly made pari
passu with, or subordinate in right of payment to the Securities. This Section
11.1(d) shall not apply to distinctions between categories of Senior Debt of
the Company that exist by reason of any liens or guarantees arising or created
in respect of some but not all of such Senior Debt.

               Section 11.2 Payment Over of Proceeds upon Dissolution, Etc. In the case
of the pendency of (a) any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company, its creditors or its property, (b) any
proceeding for the liquidation, dissolution or other winding-up of the Company,
voluntary or involuntary, whether or not involving insolvency or bankruptcy
proceedings, (c) any assignment by the Company for the benefit of creditors or
(d) any other marshalling of the assets of the Company (each such event, if
any, herein sometimes referred to as a “Proceeding”), then the holders of
Senior Debt shall be entitled to receive payment in full of principal of and
premium (if any) and interest on such Senior Debt (including any interest
thereon accruing after the commencement of any such Proceeding), or provision
shall be made for such payment in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of Senior Debt, before the Holders of the
Securities are entitled to receive or retain any payment or distribution of any
kind or character, whether in cash, property or securities, on account of
principal of or premium (if any), the cash portion or any non-Common Stock
portion of the Conversion Obligation (if any), or interest (including Stated
Interest, Contingent Interest and Deferred Interest) on the Securities or on
account of the purchase or other acquisition of Securities by the Company or
any Subsidiary and to that end the holders of Senior Debt shall be entitled to
receive, for application to the payment thereof, any payment or distribution of
any kind or character, whether in cash, property or securities, which may be
payable or deliverable in respect of the Securities in any such Proceeding.

               In the event of any Proceeding, after payment in full of all sums owing
with respect to Senior Debt, the Holders of the Securities, together with the
holders of any obligations of the Company ranking on a parity with the
Securities, shall be entitled to be paid from the remaining assets of the
Company the amounts at the time due and owing on account of unpaid principal of
and premium (if any), the cash portion or any non-Common Stock portion of the
Conversion Obligation (if any), and interest on (including Stated Interest,
Contingent Interest and Deferred Interest) the Securities and such other
obligations before any payment or other distribution, whether in cash, property
or otherwise, shall be made on account of any capital stock or any obligations
of the Company ranking junior to the Securities and such other obligations.

               In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of the Company of

60

 

any kind or character,
whether in cash, property or securities before all Senior Debt is paid in full
or payment thereof is provided for in cash or cash equivalents or otherwise
in a manner satisfactory to the holders of Senior Debt, then and in such event
such payment or distribution shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee,
agent or other Person making payment or distribution of assets of the Company
for application to the payment of all Senior Debt remaining unpaid, to the
extent necessary to pay all Senior Debt in full, after giving effect to any
concurrent payment or distribution to or for the holders of Senior Debt.

               For purposes of this Article 11 only, the words “any payment or
distribution of any kind or character, whether in cash, property or securities”
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment which securities are subordinated
in right of payment to all then outstanding Senior Debt at least to the same
extent as the Securities are so subordinated as provided in this Article. The
consolidation of the Company with, or the merger of the Company into, another
Person or the liquidation or dissolution of the Company following the sale of
all or substantially all of its properties and assets as an entirety to another
Person upon the terms and conditions set forth in Article 5 shall not be deemed
a Proceeding for the purposes of this Section if the Person formed by such
consolidation or into which the Company is merged or the Person which acquires
by sale such properties and assets as an entirety, as the case may be, shall,
as a part of such consolidation, merger, or sale comply with the conditions set
forth in Article 5.

               Section 11.3 Prior Payment to Senior Debt upon Acceleration of Securities.
In the event that any Securities are declared due and payable before their
Stated Maturity, then and in such event the holders of the Senior Debt
outstanding at the time such Securities so become due and payable shall be
entitled to receive payment in full of all amounts due on or in respect of such
Senior Debt (including any amounts due upon acceleration), or provision shall
be made for such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Debt, before the Holders of the
Securities are entitled to receive any payment or distribution of any kind or
character, whether in cash, properties or securities by the Company on account
of the principal of (or premium, if any), the cash portion or any non-Common
Stock portion of the Conversion Obligation (if any), or interest (including
Stated Interest, Contingent Interest and Deferred Interest) on the Securities
(including upon conversion) or on account of the purchase or other acquisition
of Securities by the Company or any Subsidiary.

               In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, then and in such event such payment shall
be paid over and delivered forthwith to the Company.

               The provisions of this Section shall not apply to any payment with respect
to which Section 11.2 would be applicable.

               Section 11.4 No Payment When Senior Debt in Default. In the event and
during the continuation of any default in the payment of principal of or
premium (if any), the cash portion or any non-Common Stock portion of the
Conversion Obligation (if any), or interest on any Senior Debt, when the same
becomes due and payable, whether at maturity or at a date fixed for prepayment
or by declaration of acceleration or otherwise, then, upon written notice of
such default to the Company by the holders of Senior Debt or any trustee
therefor, unless and until such event of default shall have been cured or
waived or shall have ceased to exist, then no payment or distribution of any
kind or character, whether in cash, properties or securities shall be made by
the Company on account of principal of or premium (if any), the cash portion or
any non-Common Stock portion of the Conversion Obligation, if any, or interest
(including any Stated Interest, Contingent Interest and Deferred Interest) on
the Securities (including

61

 

upon conversion) or on account of the purchase or other acquisition of
Securities by the Company or any Subsidiary.

               In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to
the time of such payment, have been made known to the Trustee or, as the case
may be, such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.

               The provisions of this Section shall not apply to any payment with respect
to which Section 11.2 would be applicable.

               Section 11.5 Payment Permitted If No Default. Nothing contained in this
Article or elsewhere in this Indenture or in any of the Securities shall
prevent (a) the Company, at any time except during the pendency of any
Proceeding referred to in Section 11.2 or under the conditions described in
Sections 11.3 and 11.4, from making payments at any time of principal of and
premium (if any), the cash portion or any non-Common Stock portion of the
Conversion Obligation (if any), or interest (including Stated Interest,
Contingent Interest and Deferred Interest) on the Securities, or (b) the
application by the Trustee of any money deposited with it hereunder to the
payment of or on account of the principal of and premium (if any), the cash
portion or any non-Common Stock portion of the Conversion Obligation (if any),
or interest (including Stated Interest, Contingent Interest and Deferred
Interest) on the Securities or the retention of such payment by the Holders,
if, at the time of such application by the Trustee, it did not have knowledge
that such payment would have been prohibited by the provisions of this Article
11.

               Section 11.6 Subrogation to Rights of Holders of Senior Debt. Subject to
the payment in full of all amounts due or to become due on all Senior Debt, or
the provision for such payment in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of the Senior Debt, the Holders of the
Securities shall be subrogated to the extent of the payments or distributions
made to the holders of such Senior Debt pursuant to the provisions of this
Article 11 (equally and ratably with the holders of all indebtedness of the
Company which by its express terms is subordinated to Senior Debt of the
Company to substantially the same extent as the Securities are subordinated to
the Senior Debt and is entitled to like rights of subrogation by reason of any
payments or distributions made to holders of such Senior Debt) to the rights of
the holders of such Senior Debt to receive payments and distributions of cash,
property and securities applicable to the Senior Debt until the principal of
(and premium, if any), the cash portion or any non-Common Stock portion of the
Conversion Obligation (if any), and interest on the Securities shall be paid in
full. For purposes of such subrogation or assignment, no payments or
distributions to the holders of the Senior Debt of any cash, property or
securities to which the Holders of the Securities or the Trustee would be
entitled except for the provisions of this Article 11, and no payments over
pursuant to the provisions of this Article 11 to the holders of Senior Debt by
Holders of the Securities or the Trustee, shall, as among the Company, its
creditors other than holders of Senior Debt, and the Holders of the Securities,
be deemed to be a payment or distribution by the Company to or on account of
the Senior Debt.

               Section 11.7 Provisions Solely to Define Relative Rights. The provisions
of this Article 11 are and are intended solely for the purpose of defining the
relative rights of the Holders of the Securities on the one hand and the
holders of Senior Debt on the other hand. Nothing contained in this Article 11
or elsewhere in this Indenture or in the Securities is intended to or shall (a)
impair, as between the Company and the Holders of the Securities, the
obligations of the Company, which are absolute and unconditional, to pay to the
Holders of the Securities the principal of, and premium (if any), the cash
portion or any non-Common Stock portion of the Conversion Obligation (if any),
and interest (including Stated Interest, Contingent Interest and Deferred
Interest) on the Securities as and when the same shall

62

 

become due and payable in accordance with their terms; or (b) affect the
relative rights against the Company of the Holders of the Securities and
creditors of the Company other than their rights in relation to the holders of
Senior Debt; or (c) prevent the Trustee or the Holder of any Security (or to
the extent expressly provided herein, the holder of any Security) from
exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, including, without limitation, filing and voting claims
in any Proceeding, subject to the rights, if any, under this Article 11 of the
holders of Senior Debt to receive cash, property and securities otherwise
payable or deliverable to the Trustee or such Holder.

               Section 11.8 Trustee to Effectuate Subordination. Each Holder of a
Security by his or her acceptance thereof authorizes and directs the Trustee on
his or her behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination provided in this Article 11 and
appoints the Trustee his or her attorney-in-fact for any and all such purpose.

               Section 11.9 No Waiver of Subordination Provisions. No right of any
present or future holder of any Senior Debt to enforce subordination as herein
provided shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any act or failure to act, in
good faith, by any such holder, or by any noncompliance by the Company with the
terms, provisions and covenants of this Indenture, regardless of any knowledge
thereof that any such holder may have or otherwise be charged with.

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

               Section 11.10 Notice to Trustee. The Company shall give prompt written
notice to the Trustee of any fact known to the Company that would prohibit the
making of any payment to or by the Trustee in respect of the Securities.
Notwithstanding the provisions of this Article 11 or any other provision of
this Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts that would prohibit the making of any payment to or by
the Trustee in respect of the Securities, unless and until the Trustee shall
have received written notice thereof from the Company or a holder of Senior
Debt or from any trustee, agent or representative therefor (whether or not the
facts contained in such notice are true); provided, however, that if the
Trustee shall not have received the notice provided for in this Section at
least two Business Days prior to the date upon which by the terms hereof any
monies may become payable for any purpose (including, without limitation, the
payment of the principal of and premium (if any), the cash portion or any
non-Common Stock portion of the Conversion Obligation (if any), or interest
(including Stated Interest, Contingent Interest and Deferred Interest) on any
Security), then, anything herein contained to the contrary notwithstanding, the
Trustee shall have full power and authority to receive such monies and to apply
the same to the purposes for which they were received, and shall not be
affected by any notice to the contrary which may be received by it within two
Business Days prior to such date.

               Subject to the provisions of Section 7.1, the Trustee shall be entitled to
conclusively rely on the delivery to it of a written notice by a Person
representing such Person to be a holder of Senior Debt

63

 

(or a trustee or attorney-in-fact therefor) to establish that such notice
has been given by a holder of Senior Debt (or a trustee or attorney-in-fact
therefor). In the event that the Trustee determines in good faith that further
evidence is required with respect to the right of any Person as a holder of
Senior Debt to participate in any payment or distribution pursuant to this
Article 11, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Debt held by
such Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article 11, and if such evidence is not furnished, the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.

               Section 11.11 Reliance on Judicial Order or Certificate of Liquidating
Agent. Upon any payment or distribution of assets of the Company referred to in
this Article 11, the Trustee, subject to the provisions of Article 7, and the
Holders of the Securities shall be entitled to conclusively rely upon any order
or decree entered by any court of competent jurisdiction in which such
Proceeding is pending, or a certificate of the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Trustee or
to the Holders of Securities, for the purpose of ascertaining the Persons
entitled to participate in such payment or distribution, the holders of the
Senior Debt and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article 11.

               Section 11.12 Trustee Not Fiduciary for Holders of Senior Debt. The
Trustee, in its capacity as trustee under this Indenture, shall not be deemed
to owe any fiduciary duty to the holders of Senior Debt and shall not be liable
to any such holders if it shall in good faith mistakenly pay over or distribute
to Holders of Securities or to the Company or to any other Person cash,
property or securities to which any holders of Senior Debt shall be entitled by
virtue of this Article 11 or otherwise.

               Section 11.13 Rights of Trustee as Holder of Senior Debt, Preservation of
Trustee’s Rights. The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article 11 in respect of any Senior Debt which
may at any time be held by it, to the same extent as any other holder of Senior
Debt, and nothing in this Indenture shall deprive the Trustee of any of its
rights as such holder. Nothing in this Article 11 shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 7.7.

               Section 11.14 Article Applicable to Paying Agents. In case at any time any
Paying Agent other than the Trustee shall have been appointed by the Company
and be then acting hereunder, the term “Trustee” as used in this Article 11
shall in such case (unless the context otherwise requires) be construed as
extending to and including such Paying Agent within its meaning as fully for
all intents and purposes as if such Paying Agent were named in this Article 11
in addition to or in place of the Trustee.

               Section 11.15 Certain Conversions or Exchanges Deemed Payment. For the
purposes of this Article 11 only, (a) the issuance and delivery of junior
securities upon exchange of Securities shall not be deemed to constitute a
payment or distribution on account of the principal of, or premium (if any),
the cash portion or any non-Common Stock portion of the Conversion Obligation
(if any), or interest (including Stated Interest, Contingent Interest and
Deferred Interest) on Securities or on account of the purchase or other
acquisition of Securities, and (b) the payment, issuance or delivery of cash,
property or securities (other than junior securities) upon exchange of a
Security shall be deemed to constitute payment on account of the principal of
such security. For the purposes of this Section, the term “junior securities”
means (i) shares of any stock of any class of the Company and (ii) securities
of the Company which are subordinated in right of payment to all Senior Debt
which may be outstanding at the time of

64

 

issuance or delivery of such securities to substantially the same extent
as, or to a greater extent than, the Securities are so subordinated as provided
in this Article 11.

               Section 11.16 Ranking of Securities in Relation to Existing Securities.
The Securities shall rank pari passu in right of payment with the Existing
Securities.

ARTICLE 12

MISCELLANEOUS

               Section 12.1 Trust Indenture Act Controls. If any provision of this
Indenture limits, qualifies, or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.

               Section 12.2 Notices. Any request, demand, authorization, notice, waiver,
consent or communication shall be in writing and delivered in Person or mailed
by first-class mail, postage prepaid, addressed as follows or transmitted by
facsimile transmission (confirmed by guaranteed overnight courier) to the
following facsimile numbers:

if to the Company, to:

AmerUs Group Co.

699 Walnut Street,

Des Moines, Iowa 50309-3948

Attention: General Counsel

Facsimile No.: (515) 362-3648

if to the Trustee, to:

BNY Midwest Trust Company

c/o The Bank of New York

Corporate Trust Department

Reorganization Unit

101 Barclay Street

New York, New York 10007

Attention: Giselle Guadalupe

Facsimile No.: (212) 298-1915

               The Company or the Trustee by notice given to the other in the manner
provided above may designate additional or different addresses for subsequent
notices or communications.

               Any notice or communication given to a Holder shall be mailed to the
Holder, by first-class mail, postage prepaid, at the Holder’s address as it
appears on the registration books of the Registrar and shall be sufficiently
given if so mailed within the time prescribed.

65

 

               Failure to mail a notice or communication to a Holder or any defect in it
shall not affect its sufficiency with respect to other Holders. If a notice or
communication is mailed in the manner provided above, it is duly given, whether
or not received by the addressee.

               If the Company mails a notice or communication to the Holders, it shall
mail a copy to the Trustee and each Registrar, Paying Agent, Conversion Agent
or Bid Solicitation Agent.

               Section 12.3 Communication by Holders with Other Holders. Holders may
communicate pursuant to TIA Section 312(b) with other Holders with respect to
their rights under this Indenture or the Securities. The Company, the Trustee,
the Registrar, the Paying Agent, the Conversion Agent, the Bid Solicitation
Agent and any other applicable Person shall have the protection of TIA Section
312(c).

               Section 12.4 Certificate and Opinion as to Conditions Precedent. Upon any
request or application by the Company to the Trustee to take any action under
this Indenture, the Company shall furnish to the Trustee:

               (a) an Officers’ Certificate stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating to
the proposed action have been complied with; and

               (b) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.

               Section 12.5 Statements Required in Certificate or Opinion. Each Officers’
Certificate or Opinion of Counsel with respect to compliance with a covenant or
condition provided for in this Indenture shall include:

               (a) a statement that each Person making such Officers’ Certificate or
Opinion of Counsel has read such covenant or condition;

               (b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such Officers’
Certificate or Opinion of Counsel are based;

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

               (d) a statement that, in the opinion of such Person, such covenant or
condition has been complied with.

               Section 12.6 Separability Clause. In case any provision in this Indenture
or in the Securities shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.

               Section 12.7 Rules by Trustee, Paying Agent, Conversion Agent, Registrar
and Bid Solicitation Agent. The Trustee may make reasonable rules for action
by, or a meeting of, Holders. The Registrar, the Conversion Agent, the Paying
Agent and the Bid Solicitation Agent may make reasonable rules for their
functions.

               Section 12.8 Legal Holidays. A “Legal Holiday” is any day other than a
Business Day. If any specified date (including a date for giving notice) is a
Legal Holiday, the action shall be taken on the

66

 

next succeeding day that is not a Legal Holiday, and, if the action to be
taken on such date is a payment in respect of the Securities, no interest, if
any, shall accrue for the intervening period.

               Section 12.9 Governing Law. THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN
THIS INDENTURE AND THE SECURITIES.

               Section 12.10 No Recourse Against Others. A director, officer, employee or
stockholder, as such, of the Company shall not have any liability for any
obligations of the Company under the Securities or for any claim based on, in
respect of or by reason of such obligations or their creation. By accepting a
Security, each Holder shall waive and release all such liability. The waiver
and release shall be part of the consideration for the issue of the Securities.

               Section 12.11 Successors. All agreements of the Company in this Indenture
and the Securities shall bind their respective successors. All agreements of
the Trustee in this Indenture shall bind its successor.

               Section 12.12 Multiple Originals. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement. One signed copy is enough to prove
this Indenture.

               Section 12.13 Waiver of Jury Trial. Each of the Company and the Trustee
hereby irrevocably waives, to the fullest extent permitted by applicable law,
any and all right to trial by jury in any legal proceeding arising out of or
relating to this Indenture, the Securities or the transactions contemplated
hereby.

67

 

               IN WITNESS WHEREOF, the undersigned, being duly authorized, have executed
this Indenture on behalf of the respective parties hereto as of the date first
above written.

	 	 	 	 	 
	 	 	AMERUS GROUP CO.
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	
 
	

	 	 	 	Name:
	

	 	 	 	Title:
	 
	 	 	 	 
	 	 	BNY MIDWEST TRUST COMPANY
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	
 
	

	 	 	 	Name:
	

	 	 	 	Title:

 

 

EXHIBIT A

[FORM OF FACE OF GLOBAL SECURITY]

     FOR PURPOSES OF SECTIONS 1273 AND 1275 OF THE INTERNAL REVENUE CODE, THE
ISSUE PRICE OF EACH SECURITY IS $1,000 PER $1,000 OF ORIGINAL PRINCIPAL AMOUNT
(OR $1,000 PER $1,270 OF PRINCIPAL AMOUNT AT MATURITY), THE ISSUE DATE IS MARCH
6, 2002 AND THE YIELD TO MATURITY (WITHOUT TAKING INTO ACCOUNT ANY CONTINGENT
INTEREST) IS APPROXIMATELY 3.8335% PER ANNUM COMPOUNDED SEMIANNUALLY FROM MARCH
6, 2002 THROUGH MARCH 6, 2007 AND APPROXIMATELY 2.2802% PER ANNUM COMPOUNDED
SEMIANNUALLY FROM MARCH 6, 2007 THROUGH MATURITY AND THE COMPARABLE YIELD FOR
PURPOSES OF ACCRUING ORIGINAL ISSUE DISCOUNT FOR UNITED STATES FEDERAL INCOME
TAX PURPOSES IS 9.917% PER ANNUM. THIS SECURITY IS ISSUED WITH AN INDETERMINATE
AMOUNT OF ORIGINAL ISSUE DISCOUNT FOR UNITED STATES FEDERAL INCOME TAX
PURPOSES. U.S. HOLDERS OF THIS SECURITY MAY OBTAIN THE PROJECTED PAYMENT
SCHEDULE FOR THIS SECURITY BY SUBMITTING A WRITTEN REQUEST FOR SUCH INFORMATION
TO: AMERUS GROUP CO., 699 WALNUT STREET, DES MOINES, IOWA 50309-3948,
ATTENTION: TREASURER.

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO AMERUS GROUP CO. (THE “COMPANY”) OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY
PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS TO NOMINEES OF
THE DEPOSITORY TRUST COMPANY, OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN ARTICLE TWO OF
THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

     [ADDITIONAL LANGUAGE FOR RESTRICTED NOTE]

     [THE FOLLOWING LEGEND MAY BE REMOVED FROM THIS SECURITY ON SATISFACTION OF
THE CONDITIONS SPECIFIED IN THE INDENTURE.

     THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), AND THIS SECURITY, AND THE COMMON STOCK, IF
ANY, DELIVERABLE UPON CONVERSION OF THIS SECURITY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT
THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS
OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.

A-3

 

     THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY
(I) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144
THEREUNDER (IF AVAILABLE) OR (III) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT IN EACH OF CASES (I) THROUGH (III) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE.]

AMERUS GROUP CO.

Optionally Convertible
Equity-Linked Accreting Notes (OCEANsSM) due March 6, 2032

	 	 	 	 	 	 	 
	No.:

	 	 	 	CUSIP:	 	 
	

	 	
 
	 	 	 	
 
	Issue Date: March 6, 2002	 	Principal Amount at Maturity: $
	Issue Price: $1,000.00	 	($1,270 principal amount at maturity for each
	(for each $1,000 original principal amount)	 	$1,000 original principal amount)

     AMERUS GROUP CO., an Iowa corporation, promises to pay to Cede & Co., or
registered assigns, the principal amount at maturity of        dollars ($       )
on March
6, 2032, subject to the further provisions of this Security set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place. This Security is convertible as specified
on the other side of this Security.

     Interest Payment Dates: March 6 and September 6, commencing March 6, 2005

     Interest Record Dates: February 20 and August 23

A-4

 

     IN WITNESS WHEREOF, the Company has caused this Security to be signed by
its duly authorized officer.

	 	 	 	 	 
	Dated: December 15, 2004	 	AMERUS GROUP CO.
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	
 
	

	 	 	 	Name:
	

	 	 	 	Title:

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

BNY Midwest Trust Company, as Trustee, certifies that this is one of the

Securities referred to in the within-mentioned Indenture.

	 	 	 	 	 
	By:
	 	 	 	 
	

	 	
 	 	 
	

	 	Authorized Signatory	 	 
	 
	 	 	 	 
	Dated: December 15, 2004	 	 

A-5

 

[FORM OF REVERSE SIDE OF SECURITY]

AMERUS GROUP CO.

Optionally Convertible
Equity-Linked Accreting Notes (OCEANsSM) due March 6, 2032

1. Interest; Accreted Principal Amount; Principal Amount at Maturity.

     The yield on the Securities (without taking into account any Contingent
Interest as defined below) will be approximately 3.8335% per annum (based on a
$1,000 original principal amount), compounded semiannually from the date of
issuance through March 6, 2007, and approximately 2.2802% per annum compounded
semiannually from March 6, 2007 through stated maturity. The Company will pay a
portion of the yield (the “Stated Interest”) as cash interest semiannually on
each March 6 and September 6, commencing on March 6, 2005 (each an “Interest
Payment Date”) at a rate of 2.00% per annum of the original principal amount of
the Securities (or $20.00 per annum per $1,000 original principal amount of the
Securities) to the registered holders of record of the Securities (the
“Holders”) on the preceding February 20 and August 23 (each an “Interest Record
Date”). Stated Interest will accrue from the last interest payment date on
which Stated Interest was paid on the Securities, or, if no Stated Interest has
been paid on the Securities, from the last interest payment date on which
Stated Interest was paid on the Existing Securities. Holders whose Existing
Securities were accepted in exchange for Securities will be deemed to have
waived the right to receive any accrued and unpaid Stated Interest on the
Existing Securities, but will receive amounts equal to such accrued and unpaid
Stated Interest in accordance with the preceding sentence. Payment of Stated
Interest may be deferred in the circumstances specified in Section 2.14 of the
Indenture. Holders whose Existing Securities were accepted in exchange for
Securities will be deemed to have waived the right to receive any accreted
value in excess of the original principal amount of their Existing Securities;
however, Securities received upon exchange of their Existing Securities will
include accreted value equal to such accreted value.

     In addition, the Company shall pay additional interest on the Securities
that is not included in the calculation of the yield on the Securities
(“Contingent Interest”). For each $1,000 original principal amount of the
Securities, Contingent Interest will accrue from the record date for any
Regular Cash Dividends (as defined below) on the shares of common stock, no par
value, of the Company (the “Common Stock”) and will be payable in cash on the
next following March 6, June 6, September 6 or December 6 (each a “Quarterly
Contingent Interest Payment Date”) to the registered Holder of record of this
Security on the February 20, May 23, August 23, or November 22 preceding each
such Quarterly Contingent Interest Payment Date (each a “Quarterly Contingent
Interest Record Date”) in an amount per $1,000 original principal amount of
Securities equal to the Regular Cash Dividends, if any, paid by the Company on
one share of Common Stock since the immediately preceding Quarterly Contingent
Interest Payment Date, multiplied by the amount obtained by dividing $1,100.00
by the Conversion Price in effect on the record date for such Regular Cash
Dividends. “Regular Cash Dividends” are regular, fixed, annual, quarterly or
other periodic cash dividends as declared by the board of directors of the
Company as part of the Company’s dividend payment practice or stated cash
dividend policy, whether publicly announced or not, and do not include any
other dividends or distributions (such as any dividends designated by the board
of directors as extraordinary, special or otherwise nonrecurring). Any Holder
receiving Securities in exchange for Existing Securities that were held by such
Holder on, but also submitted for exchange during a period that includes, any
Quarterly Contingent Interest Record Date shall be entitled to receive and keep
in respect of its Securities on the next succeeding Quarterly Contingent
Interest Payment Date any accrued and unpaid Contingent Interest on such
Existing Securities up to, but not including, the date of exchange of such
Existing Securities for Securities. Holders whose Existing Securities are
accepted for

A-6

 

exchange will be deemed to have waived the right to receive any accrued
and unpaid Contingent Interest on the Existing Securities.

     Interest will be calculated on the basis of a 360-day year of twelve
30-day months.

     The Securities shall be issued in $1,000 original principal amount or
integral multiples thereof and each $1,000 original principal amount of
Securities shall have a principal amount at maturity of $1,270. The “Accreted
Principal Amount” of the Securities means, for any date, for each $1,000
original principal amount of Securities:

A-7

 

     (a) if such date occurs on an Interest Payment Date, the Accreted
Principal Amount will equal the amount set forth below for such date:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Interest	 	Accreted	 	 	 	 	 	Accreted
	Payment Date
	 	Principal Amount
	 	Interest Payment Date
	 	Principal Amount

	September 6, 2004
	 	$	1,047.63	 	 	September 6, 2018	 	$	1,166.40	 
	March 6, 2005
	 	$	1,057.71	 	 	March 6, 2019	 	$	1,169.70	 
	September 6, 2005
	 	$	1,067.98	 	 	September 6, 2019	 	$	1,173.03	 
	March 6, 2006
	 	$	1,078.45	 	 	March 6, 2020	 	$	1,176.41	 
	September 6, 2006
	 	$	1,089.12	 	 	September 6, 2020	 	$	1,179.82	 
	March 6, 2007
	 	$	1,100.00	 	 	March 6, 2021	 	$	1,183.27	 
	September 6, 2007
	 	$	1,102.54	 	 	September 6, 2021	 	$	1,186.76	 
	March 6, 2008
	 	$	1,105.11	 	 	March 6, 2022	 	$	1,190.29	 
	September 6, 2008
	 	$	1,107.71	 	 	September 6, 2022	 	$	1,193.86	 
	March 6, 2009
	 	$	1,110.34	 	 	March 6, 2023	 	$	1,197.48	 
	September 6, 2009
	 	$	1,113.00	 	 	September 6, 2023	 	$	1,201.13	 
	March 6, 2010
	 	$	1,115.69	 	 	March 6, 2024	 	$	1,204.82	 
	September 6, 2010
	 	$	1,118.41	 	 	September 6, 2024	 	$	1,208.56	 
	March 6, 2011
	 	$	1,121.16	 	 	March 6, 2025	 	$	1,212.34	 
	September 6, 2011
	 	$	1,123.94	 	 	September 6, 2025	 	$	1,216.16	 
	March 6, 2012
	 	$	1,126.76	 	 	March 6, 2026	 	$	1,220.03	 
	September 6, 2012
	 	$	1,129.60	 	 	September 6, 2026	 	$	1,223.94	 
	March 6, 2013
	 	$	1,132.48	 	 	March 6, 2027	 	$	1,227.89	 
	September 6, 2013
	 	$	1,135.39	 	 	September 6, 2027	 	$	1,231.89	 
	March 6, 2014
	 	$	1,138.34	 	 	March 6, 2028	 	$	1,235.93	 
	September 6, 2014
	 	$	1,141.32	 	 	September 6, 2028	 	$	1,240.03	 
	March 6, 2015
	 	$	1,144.33	 	 	March 6, 2029	 	$	1,244.16	 
	September 6, 2015
	 	$	1,147.38	 	 	September 6, 2029	 	$	1,248.35	 
	March 6, 2016
	 	$	1,150.46	 	 	March 6, 2030	 	$	1,252.58	 
	September 6, 2016
	 	$	1,153.57	 	 	September 6, 2030	 	$	1,256.86	 
	March 6, 2017
	 	$	1,156.73	 	 	March 6, 2031	 	$	1,261.19	 
	September 6, 2017
	 	$	1,159.91	 	 	September 6, 2031	 	$	1,265.57	 
	March 6, 2018
	 	$	1,163.14	 	 	March 6, 2032	 	$	1,270.00	 

     (b) if such date occurs between any two Interest Payment Dates, the
Accreted Principal Amount will equal the sum of (a) the Accreted Principal
Amount for the Interest Payment Date immediately preceding such date and (b)
an amount equal to the product of (x) the Accreted Principal Amount for the
immediately following Interest Payment Date less the Accreted Principal
Amount for the immediately preceding Interest Payment Date multiplied by (y)
a fraction, the numerator of which is the number of days from the immediately
preceding Interest Payment Date to such date, using a 360-day year of twelve
30-day months, and the denominator of which is 180.

     The Company shall repay the Securities at their stated maturity on March
6, 2032, at a price equal to their Accreted Principal Amount on such date
($1,270.00 per Security) plus any accrued and unpaid interest (including Stated
Interest, Contingent Interest and Deferred Interest) thereon up to but not
including the stated maturity, unless earlier redeemed by the Company,
purchased by the Company at the option of Holders or converted. The Company
will pay interest on any overdue Accreted Principal Amount, at the rate of
2.00% per annum, compounded semiannually, and it shall pay interest on overdue
installments of interest (without regard to any applicable grace period), at
2.00% per annum compounded semiannually; provided that any interest payment
deferred by the Company in accordance with the terms of the Indenture shall not
be considered overdue.

A-8

 

2. Method of Payment.

     The Company will pay interest on this Security (except defaulted interest)
to the Person who is the registered Holder of this Security at the close of
business on the record date preceding the interest payment date relating to
that payment of interest. If an interest payment date falls on a date that is
not a Business Day, payment will be made on the next Business Day (and without
any interest or other payment in respect of this delay). Subject to the terms
and conditions of the Indenture, the Company will make payments in respect of
the Redemption Price, Change of Control Purchase Price and the principal amount
at maturity, as the case may be, to the Holder who surrenders a Security to the
Paying Agent to collect such payments in respect of the Security. The Company
will pay cash amounts in money of the United States that at the time of payment
is legal tender for payment of public and private debts. However, the Company
may pay principal of or premium, if any, or interest (including Stated
Interest, Contingent Interest and Deferred Interest), if any, on the Securities
by check or wire payable in such money. The Company may mail an interest check
to the Holder’s registered address. Notwithstanding the foregoing, so long as
this Security is registered in the name of a Depositary or its nominee, all
payments hereon shall be made by wire transfer of immediately available funds
to the account of the Depositary or its nominee.

3. Paying Agent, Conversion Agent, Bid Solicitation Agent and Registrar.

     Initially, BNY Midwest Trust Company (the “Trustee”) will act as Paying
Agent, Conversion Agent, Registrar and Bid Solicitation Agent. The Company may
appoint and change any Paying Agent, Conversion Agent, Registrar or Bid
Solicitation Agent without notice, other than notice to the Trustee; provided
that the Company will maintain at least one Paying Agent in the State of New
York, City of New York, Borough of Manhattan, which shall initially be an
office or agency of the Trustee. The Company or any of its Subsidiaries or any
of their Affiliates may act as Paying Agent, Conversion Agent, Registrar or Bid
Solicitation Agent.

4. Indenture.

     The Company issued the Securities under an Indenture dated as of December
15, 2004 (the “Indenture”), between the Company and the Trustee. The terms of
the Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as in effect from
time to time (the “TIA”). Capitalized terms used herein and not defined herein
have the meanings ascribed thereto in the Indenture. The Securities are subject
to all such terms, and Holders are referred to the Indenture and the TIA for a
statement of those terms. In the event of any conflict between the terms of
this Security and the terms of the Indenture, the terms of the Indenture shall
govern.

     The Securities are general unsecured obligations of the Company limited to
$185,000,000 aggregate original principal amount or $234,950,000 aggregate
principal amount at maturity (subject to Section 2.2 of the Indenture). The
Indenture does not limit other indebtedness of the Company, secured or
unsecured.

5. Redemption at the Option of the Company.

     The Company may elect to redeem the Securities in accordance with the
terms of the Indenture if (a) the Sale Price per share of the Common Stock for
at least 20 Trading Days in the 30 Trading-Day period ending on the Trading Day
prior to the date on which the Company gives notice to redeem the Securities
exceeds 140% of the Initial Stock Price; (b) a Change of Control has occurred
and the Company has not given a Public Acquirer Change of Control Notice in
connection therewith; or (c) a Tax Event has

A-9

 

occurred and the Tax Event Conversion Value of the Securities exceeds
their Accreted Principal Amount by at least 10%.

     The Redemption Price will equal 100% of the Accreted Principal Amount of
the Securities to be redeemed on the redemption date, plus, subject to the
terms of the Indenture, accrued and unpaid interest (including Stated Interest,
Contingent Interest and Deferred Interest), if any, thereon up to but not
including the redemption date, plus, in the event of a Change of Control,
unless a Public Acquirer Change of Control occurs and the Company makes an
election specified in Section 10.3(d) of the Indenture, if such Change of
Control occurs prior to March 6, 2007, the Conversion Make-Whole Premium, if
any plus with respect to Securities redeemed prior to March 6, 2007, a Treasury
Make-Whole Premium.

     Holders may convert Securities or portions thereof called for redemption
until the close of business on the day that is two Business Days prior to the
redemption date. If the Company elects to redeem less than all of the
outstanding Securities as permitted by the Indenture, the Trustee shall select
the Securities to be redeemed on a pro rata basis in $1,000 original principal
amount or integral multiples thereof.

6. Purchase by the Company at the Option of the Holder.

     Subject to and in compliance with the terms and conditions of the
Indenture, if a Change of Control occurs, each Holder shall have the right, at
its option, to require the Company to repurchase all Securities or any portion
thereof, in $1,000 original principal amount or integral multiples thereof,
held by such Holder on a Repurchase Date at the Change of Control Purchase
Price, determined pursuant to Section 3.8(a) of the Indenture. To exercise such
repurchase right, a Holder must deliver a Change of Control Purchase Notice in
the form attached hereto to the Company on or before the date which, subject to
any contrary requirements of applicable law, is the fifth Business Day prior to
the Repurchase Date and must surrender the Securities with respect to which the
right is being exercised. Holders have the right to withdraw any Change of
Control Purchase Notice by delivering to the Paying Agent a written notice of
withdrawal in accordance with the provisions of the Indenture.

     If cash and other required amounts sufficient to pay the Change of Control
Purchase Price on all Securities or portions thereof to be purchased as of the
Repurchase Date is deposited with the Paying Agent on the Business Day
preceding the Repurchase Date, interest ceases to accrue on such Securities (or
portions thereof) on such Repurchase Date, and the Holder thereof shall have no
other rights as such other than the right to receive the Change of Control
Purchase Price upon surrender of such Securities.

7. Notice of Redemption.

     Notice of redemption pursuant to paragraph 5 of this Security will be
mailed to each Holder of Securities to be redeemed at least 15 days, but not
more than 60 days before the Redemption Date at the Holder’s registered address
as it appears in the Register. If money and other required amounts sufficient
to pay the Redemption Price of all Securities (or portions thereof) to be
redeemed on the Redemption Date, is deposited with the Paying Agent prior to or
on the Redemption Date, immediately from such Redemption Date, interest ceases
to accrue on such Securities or portions thereof. Securities in denominations
larger than $1,000 of original principal amount may be redeemed in part but
only in integral multiples of $1,000 original principal amount.

8. Conversion.

     In accordance with the Indenture, each Holder shall have the right, at its
option, to convert Securities or any portion thereof, in $1,000 original
principal amount or integral multiples thereof, into cash and fully paid and
nonassessable shares of Common Stock, if any, during specified periods if one
or more of

A-10

 

the conditions for the conversion of Securities specified in Article 10 of
the Indenture is satisfied. The Company will notify Holders of any event
triggering the right to convert the Securities as specified above as required
by the Indenture.

     Securities in respect of which a Holder has delivered a Change of Control
Purchase Notice exercising the option of such Holder to require the Company to
repurchase such Securities may be converted only if such notice is withdrawn in
accordance with the terms of the Indenture.

     The Conversion Price will initially be $37.598 per share of Common Stock,
subject to adjustment upon the occurrence of certain events described in the
Indenture. The Company from time to time may voluntarily reduce the Conversion
Price by any amount for a period of at least 20 days. No fractional shares of
Common Stock shall be issued upon conversion of any Securities. Instead of any
fractional share of Common Stock that would otherwise be issued upon conversion
of such Securities, the Company shall pay a cash adjustment as provided in the
Indenture.

     Upon conversion of any Securities or portion thereof, Holders shall be
entitled to receive cash, Common Stock or other non-cash consideration as
determined pursuant to Section 10.3 of the Indenture.

     To surrender a Security for conversion, a Holder must (1) complete and
manually sign the conversion notice attached hereto (or complete and manually
sign a facsimile of such notice) and deliver such notice to the Conversion
Agent, (2) surrender the Security to the Conversion Agent, (3) furnish
appropriate endorsements and transfer documents and (4) pay any transfer or
similar tax, if required.

     If the Company is party to a Merger Transaction, the right to convert a
Security into cash and shares of Common Stock may be changed into a right to
convert it into the amount and type of consideration as set forth in the
Indenture.

     The Company has the option, on the terms set forth in Section 10.2 of the
Indenture, to designate a financial institution to which Securities surrendered
for conversion will be initially offered by the Conversion Agent for exchange
in lieu of the Company converting the Securities. In order to accept Securities
surrendered for conversion, the designated institution must (a) on the
conversion date, agree to deliver in exchange for such Securities such
consideration the Holder would receive upon conversion; and (b) deliver such
shares of Common Stock, cash payment and any other required consideration, if
any, to the Conversion Agent for delivery to the Holder. Any Securities
accepted for exchange by the designated institution will remain outstanding. If
the designated institution declines to accept any Securities in whole or in
part, or agrees to accept any Securities for exchange but does not timely
deliver the required consideration, the Securities or portions thereof will be
converted by the Conversion Agent and such required consideration will be
delivered to the Holder. Securities surrendered for conversion during the
period after any interest record date but prior to the corresponding interest
payment date or at any time prior to March 6, 2007 pursuant to a notice of
redemption of such Securities given by the Company, or a Change of Control or
distribution specified in Section 10.1(b)(vii) of the Indenture, will not be
offered for exchange in lieu of conversion.

9. Subordination

     The indebtedness evidenced by the Securities is, to the extent and in the
manner provided in the Indenture, subordinate and junior in right of payment to
the prior payment in full of all Senior Debt of the Company, pari passu with
all of the Existing Securities and the Company’s other senior subordinated
indebtedness, if any, and senior to all of the Company’s junior subordinated
indebtedness. Any Holder by accepting this Security agrees to and shall be
bound by such subordination provisions and authorizes the Trustee to give them
effect. The Company shall not incur any Debt that is expressly made subordinate
in

A-11

 

right of payment to any of the Company’s Senior Debt unless such Debt, by
its terms or by the terms of any agreement or instrument pursuant to which such
Debt is outstanding, is expressly made pari passu with or subordinate in right
of payment to the Securities; provided that the foregoing limitation shall not
apply to distinctions between categories of the Senior Debt that exist by
reason of any liens or guarantees arising or created in respect of some but not
all of such Senior Debt.

10. Denominations; Transfer; Exchange.

     The Securities are in fully registered form, without coupons, in
denominations of integral multiples of $1,000 original principal amount. A
Holder may transfer or exchange Securities in accordance with the Indenture.
The Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not transfer or exchange
any Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities in respect of which a Change of Control Purchase Notice has been
given and not withdrawn, in accordance with the terms and conditions of the
Indenture (except, in the case of a Security to be purchased in part, the
portion of the Security not to be purchased), or any Securities selected for
redemption for a period of 15 days before the mailing of the notice of
redemption relating thereto.

11. Persons Deemed Owners.

     The registered Holder of this Security may be treated as the owner of this
Security for all purposes.

12. Unclaimed Money or Securities.

     The Trustee and the Paying Agent shall return to the Company upon written
request any money or securities or non-cash amounts held by them for the
payment of any amount with respect to the Securities that remains unclaimed for
two years, subject to applicable unclaimed property law. After return to the
Company, Holders entitled to such money or securities or non-cash amounts must
look to the Company, for payment as general creditors unless an applicable
abandoned property law designates another Person.

13. Amendment; Waiver.

     Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in aggregate original principal amount of the
Securities at the time outstanding and (ii) certain Defaults may be waived with
the written consent of the Holders of a majority in aggregate original
principal amount of the Securities at the time outstanding. Subject to certain
exceptions set forth in the Indenture, without the consent of any Holder, the
Company and the Trustee may amend the Indenture or the Securities (i) to cure
any ambiguity, defect or inconsistency in the Indenture or in the Securities;
(ii) to provide for the assumption of the Company’s obligations to Holders;
(iii) to comply with Section 5.1 or Section 10.5 of the Indenture, (iv) to make
any change that does not materially adversely affect the rights of any Holder,
or (v) to make any change necessary for the registration of the Securities
under the Securities Act or to comply with the TIA, or any amendment thereto,
or comply with any requirement of the SEC in connection with the qualification
of the Indenture under the TIA.

14. Defaults and Remedies.

     Under the Indenture, an Event of Default is (a) a default in the payment
of interest (including Stated Interest and Contingent Interest) on any Security
that continues for 30 days or more after such payment is due, except to the
extent any payment of Stated Interest is deferred pursuant to the Indenture;
(b) a default

A-12

 

in the payment of Accreted Principal Amount, Deferred Interest, premium
(if any), Redemption Price or, Change of Control Purchase Price in respect of
any Security when due, except to the extent any payment of Deferred Interest is
extended pursuant to the Indenture; (c) a default in the performance of any
other of the Company’s covenants or agreements in the Indenture (other than
those referred in clauses (a) and (b) above) that continues for 90 days after
written notice (“Notice of Default”) to the Company by the Trustee or to the
Company and the Trustee by the Holders of at least 25% in original principal
amount of outstanding Securities; (d) failure by the Company to make any
payment when due, including any applicable grace period, in respect of the
Company’s indebtedness for borrowed money, which failure results in
acceleration of such indebtedness which is in an amount in excess of the
Applicable Limit and such indebtedness is not discharged, or such payment
default and acceleration is not cured or rescinded, within 30 days; (e) any
other default by the Company under any of its indebtedness for borrowed money
(other than a Default described in clause (d) above), which default results in
acceleration of such indebtedness which is in an amount in excess of the
Applicable Limit and such indebtedness is not discharged, or such acceleration
is not rescinded, within 30 days; and (f) certain events of bankruptcy,
insolvency or reorganization with respect to the Company.

     “Applicable Limit” means (i) at any time prior to March 6, 2007,
$25,000,000, and (ii) at any time on or after March 6, 2007, $50,000,000.

     Holders may not enforce the Indenture or the Securities except as provided
in the Indenture. The Trustee may refuse to enforce the Indenture or the
Securities unless it receives indemnity or security reasonably satisfactory to
it. Subject to certain limitations, Holders of a majority in aggregate
original principal amount of the Securities at the time outstanding may direct
the Trustee in its exercise of any trust or power. The Trustee may withhold
from Holders notice of any continuing Default (except a Default in payment of
amounts specified in clause (i) or (ii) above) if it determines that
withholding notice is in their interests.

15. Trustee Dealings with the Company.

     Subject to certain limitations imposed by the TIA, the Trustee under the
Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or their respective Affiliates with the same rights it would have if it were
not Trustee.

16. No Recourse Against Others.

     A director, officer, employee or shareholder, as such, of the Company
shall not have any liability for any obligations of the Company under the
Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Holder waives and releases all such liability. The waiver and release are part
of the consideration for the issue of the Securities.

17. Authentication.

     This Security shall not be valid until an authorized signatory of the
Trustee manually signs the Trustee’s Certificate of Authentication on the other
side of this Security.

18. Abbreviations.

     Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (“tenants in common”), TEN ENT (“tenants by the
entireties”), JT TEN (“joint tenants with right of

A-13

 

survivorship and not as tenants in common”), CUST (“custodian”) and
U/G/M/A (“Uniform Gift to Minors Act”).

     19. Governing Law.

     THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THE INDENTURE AND THIS
SECURITY.

     The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:

AmerUs Group Co.

699 Walnut Street

Des Moines, Iowa 50309-3948

Attention: Investor Relations

Facsimile No.: (515) 362-3648

A-14

 

	 	 	 
	ASSIGNMENT FORM

	 	CONVERSION NOTICE
	 
	 	 
	To assign this Security, fill in the form below:

	 	To convert this
Security into Common
Stock of the Company,
check the box o
	 
	 	 
	I or we assign and transfer this Security to

	 	To convert only part
of this Security,
state the original
principal amount to be
converted (which must
be $1,000 or an
integral multiple of
$1,000):
	

	 	 
	

	 	 
	

	 	 
	 
	 	 
	(Insert assignee’s soc. sec. or tax ID no.)

	 	If you want the stock
certificate made out
in another person’s
name fill in the form
below:
	 
	 	 
	

	 	

	

	 	

	

	 	(Insert the other
person’s soc. sec. or
tax ID no.)M
	 
	 	 
	(Print or type assignee’s name, address and zip
code)
	 	 
	

	 	 
	and irrevocably appoint      agent
to transfer this
Security on the books
of the Company. The
agent may substitute
another to act for him.

	 	

	

	 	

	

	 	

	 
	 	 
	

	 	(Print or type other
person’s name, address
and zip code)

	 	 	 	 	 	 	 
	Date:

	 	 	 	Your Signature:	 	 
	

	 	
 
	 	 	 	
 
	

	(Sign exactly as your name appears on the face of this Security)

	Signature Guaranteed	 	 
	
	 	 
	Participant in a Recognized Signature	 	 
	Guarantee Medallion Program	 	 

	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	

	 	
 	 	 	 	 
	

	 	Authorized Signatory	 	 	 	 

A-15

 

CHANGE OF CONTROL PURCHASE NOTICE

	To:	 	 AmerUs Group Co.

699 Walnut Street

Des Moines, Iowa 50309-3948

Attention: Company Secretary

     The undersigned registered owner of this Security hereby irrevocably
acknowledges receipt of a notice from AmerUs Group Co. (the “Company”) as to
the occurrence of a Change of Control with respect to the Company and requests
and instructs the Company to purchase the entire original principal amount of
this Security, or the portion thereof (which is in $1,000.00 original principal
amount or an integral multiple thereof) below designated, in accordance with
the terms of the Indenture referred to in this Security at the Change of
Control Purchase Price, together with accrued interest to, but excluding, such
date, to the registered Holder hereof.

	 	 	 	 	 
	Dated:
	 	 	 	 
	

	 	
 
	 	
 
	

	 	 	 	
 
	

	 	 	 	Signature(s) must be guaranteed by a
qualified guarantor institution with
membership in an approved signature
guarantee program pursuant to Rule
17Ad-15 under the Securities
Exchange Act of 1934.
	

	 	 	 	
 
	

	 	 	 	Signature Guaranty (NOTICE: The
signature to the foregoing Election
must correspond to the Name as
written upon the face of this
Security in every particular,
without alteration or any change
whatsoever.)
	 
	 	 	 	 
	Original principal amount to be	 	 
	repurchased (in an integral multiple	 	 
	of $1,000, if less than all):	 	 
	

	 	 	 	
 

A-16

 

REQUEST FOR BID QUOTATION FOR SECURITIES

	To:	 	BNY Midwest Trust Company

c/o The Bank of New York

Corporate Trust Department

Reorganization Unit

101 Barclay Street

New York, New York 10007

Attention: Giselle Guadalupe

(the “Bid Solicitation Agent”)

	Re:	 	Optionally Convertible Equity-Linked Accreting Notes (OCEANsSM) Due
March 6, 2032 (the “Securities”) of AmerUs Group Co. (the “Company”)

     Reference is made to Section 10.1(b)(iv) of the Indenture dated as of
December 15, 2004 between the Company and BNY Midwest Trust Company (the
“Indenture”). This Request relates to $185,000,000 original principal amount1
of Securities (the “Relevant Securities”) issued by the Company and held by the
undersigned in (check applicable box):

o book-entry     or     o certificated form.

     The undersigned hereby certifies it has sought to obtain a firm bid from
the two securities dealers named below for the Relevant Securities on          2 (the
“Relevant Date”) and was unable to obtain a bid for such Securities in an
amount at least equal to the product of (a) 90% of the Sale Price (as defined
in the Indenture) of the Company’s common stock on the Relevant Date, and (b)
$1,100.00 divided by the Conversion Price in effect on the Relevant Date (the
“Minimum Amount”):

	 	 	 
	Securities Dealer:
	 	 
	

	 	
 
	 
	 	 
	Securities Dealer:
	 	 
	

	 	
 

     The undersigned hereby requests the Bid Solicitation Agent to obtain, on
behalf of the undersigned, firm bids for the Relevant Securities from any
nationally recognized securities dealer subject to and in compliance with the
terms of the Indenture. The undersigned hereby agrees for the benefit of the
Company and the Bid Solicitation Agent that (a) the undersigned shall use its
best efforts to sell the Relevant Securities on any day during the three
consecutive trading-day period following the delivery of this Request to the
Bid Solicitation Agent (the “Measurement Period”) to any securities dealer that
provides the Bid Solicitation Agent with a firm bid to purchase the Relevant
Securities in an amount at least equal to the Minimum Amount

____________

	1	 	This amount shall be an integral multiple of $1,000 original principal
amount and shall be not less than $1,000,000 (or, if the undersigned
beneficially owns less than $1,000,000 original principal amount of
Securities, all of the undersigned’s Securities) and not more than
$10,000,000 original principal amount of the Securities.
	 
	2	 	Specify date on which such firm bids were sought which date shall be
within three days of the date of delivery of this Request.

A-17

 

per $1,000 original principal amount of the Securities and (b) the undersigned
shall convert the Relevant Securities in accordance with the terms of the
Indenture if the Bid Solicitation Agent cannot obtain a firm bid to purchase
the Relevant Securities at least equal to the Minimum Amount per $1,000
original principal amount of Securities during the Measurement Period.

A-18

 

	 	 	 	 	 	 	 
	Date:	 	 
	 
	 	 	 	 	 	 
	
	 	 
	Name:	 	 
	 
	 	 	 	 	 	 
	Title:	 	 
	 
	 	 	 	 	 	 
	Signature Guaranteed:	 	 
	 
	 	 	 	 	 	 
	
	 	 
	(Participant in a Recognized Signature Guarantee Medallion Program)	 	 
	 
	 	 	 	 	 	 
	By:
	 	 	 	 	 	 
	 	 	
	 	 
	 	 	Authorized Signatory
	 	 
	Address:	 	 	 	 
	

	 	 	 	
	 	 
	

	 	 	 	
	 	 
	

	 	 	 	
	 	 
	 
	 	 	 	 	 	 
	Telephone:	 	 	 	 
	

	 	 	 	
	 	 
	 
	 	 	 	 	 	 
	Fax:	 	 	 	 
	

	 	 	 	
	 	 

A-19

 

SCHEDULE OF EXCHANGES OF SECURITIES

     The following exchanges, redemptions, repurchases or conversions of a part
of this Global Security have been made:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Original Principal	 	 	 	 	 	 	 	 	 	 
	Amount Represented	 	 	 	 	 	 	 	 	 	 
	by this Global Security	 	 	 	 	 	 	 	 	 	Amount of
	Following Such	 	 	 	 	 	Amount of Decrease in	 	Increase in
	Redemption,	 	 	 	 	 	Original Principal	 	Original Principal
	Repurchase,	 	Authorized	 	Amount Represented	 	Amount Represented
	Conversion or	 	Signatory of	 	by	 	by
	Exchange
	 	the Trustee3
	 	this Global Security
	 	this Global Security

	3	 	In its capacity as custodian with respect to the Global Securities.

 

A-20

 

EXHIBIT B

CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF

RESTRICTED SECURITIES1

	 	 	Re: Optionally Convertible Equity-Linked Accreting Notes
(OCEANsSM) Due
March 6, 2032 (the “Securities”) of AmerUs Group Co.

     This certificate relates to $    original principal amount of Securities
owned by    (the “Transferor”) in (check applicable box):

     o book-entry or      o certificated form

     The Transferor has requested a Registrar or the Trustee to exchange or
register the transfer of such Securities.

     In connection with any transfer of any of the Securities within the period
prior to the expiration of the holding period applicable to the sales thereof
under Rule 144(k) under the Securities Act of 1933, as amended (the “Securities
Act”) (or any successor provision), the undersigned registered owner of this
Security hereby certifies the Transferor is familiar with transfer restrictions
relating to the Securities as provided in Article 2 of the Indenture dated as
of December 15, 2004 between AmerUs Group Co. and BNY Midwest Trust Company,
the trustee (the “Indenture”), and with respect to $    original principal amount
of the above-captioned Securities presented or surrendered on the date hereof
(the “Surrendered Securities”) for registration of transfer, or for exchange or
conversion where the securities deliverable upon such exchange or conversion
are to be registered in a name other than that of the undersigned registered
owner (each such transaction being a “transfer”), that such transfer complies
with the restrictive legend set forth on the face of the Surrendered Securities
for the reason checked below:

	o 	 	A transfer of the Surrendered Securities is made to the Company or any
of its Subsidiaries (as defined in the Indenture); or
	 
	o 	 	The transfer of the Surrendered Securities complies with Rule 144A
under the Securities Act and is to a person whom the Transferor
reasonably believes is a Qualified Institutional Buyer (as defined in
Rule 144A); or
	 
	o 	 	The transfer of the Surrendered Securities is pursuant to an effective
registration statement under the Securities Act; or
	 
	o	 	The transfer of the Surrendered Securities is pursuant to an exemption
from the registration under the Securities Act provided by Rule 144
thereunder.

	1	 	This certificate should only be included if this Security is a Restricted
Security.

and unless the box below is checked, the undersigned confirms that, to the
undersigned’s knowledge, such Securities are not being transferred to an
“affiliate” of the Company as defined in Rule 144 under the Securities Act (an
“Affiliate”).

B-1

 

	 	 	o The transferee is an Affiliate of the Company.

	 	 	 
	DATE:
	 	 
	

	 	
 
	

	 	Signature(s)

     (If the registered owner is a corporation, partnership or fiduciary, the
title of the Person signing on behalf of such registered owner must be stated.)

B-2

 

	 	 	 	 	 
	Signature Guaranteed	 	 
	

	Participant in a Recognized Signature	 
	Guarantee Medallion Program	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	

	 	
 	 	 
	

	 	Authorized Signatory	 	 

B-3

 

EXHIBIT C

PROJECTED PAYMENT SCHEDULE

C-1

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