Document:

exv10wdw1

 

EXHIBIT 10.D.1

AMENDMENT NO. 1 TO AMENDED AND RESTATED CREDIT AGREEMENT

     AMENDMENT dated as of January 19, 2007 to the Amended and Restated Credit Agreement dated as
of July 31, 2006 (the “Credit Agreement”) among EL PASO CORPORATION, COLORADO INTERSTATE GAS
COMPANY, EL PASO NATURAL GAS COMPANY, TENNESSEE GAS PIPELINE COMPANY, the several banks and other
financial institutions from time to time parties thereto, and JPMORGAN CHASE BANK, N.A., as
administrative agent and as collateral agent.

     The parties hereto agree as follows:

     SECTION 1 . Defined Terms; References. Unless otherwise specifically
defined herein, each term used herein that is defined in the Credit Agreement has the meaning
assigned to such term in the Credit Agreement. Each reference to “hereof”, “hereunder”, “herein”
and “hereby” and each other similar reference and each reference to “this Agreement” and each other
similar reference contained in the Credit Agreement shall, after this Amendment becomes effective,
refer to the Credit Agreement as amended hereby.

     SECTION 2 . Amendment. The definition of “Consolidated EBITDA” in Section 1.01 of the Credit
Agreement is amended by adding the following new clause (x) immediately before the proviso thereto:

     plus (x) any charges taken during such period in connection with the payment,
repayment, redemption, defeasance, early retirement or refinancing of any debt;

     SECTION 3 . Representations of Borrowers. The Borrowers represent and warrant that
(i) the representations and warranties of the Borrowers set forth in Article 4 of the Credit
Agreement will be true on and as of the Amendment Effective Date (as defined below) and (ii) no
Default will have occurred and be continuing on such date.

     SECTION 4 . Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of New York.

     SECTION 5 . Counterparts. This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.

     SECTION 6 . Effectiveness. This Amendment shall become effective on the
date (the “Amendment Effective Date”) when the Administrative Agent shall have received from each
of the Borrowers and Lenders comprising the Majority Lenders a counterpart hereof signed by such
party or facsimile or other written confirmation (in form satisfactory to the Administrative Agent)
that such party has signed a counterpart hereof.

1

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of
the date first above written.

	 	 	 	 	 
	 	

EL PASO CORPORATION

 	 
	 	By:  	/s/ John J. Hopper
 	 
	 	 	Name:  	John J. Hopper 	 
	 	 	Title:  	Vice President and
Treasurer 	 
	 
	 	COLORADO INTERSTATE GAS COMPANY

 	 
	 	By:  	/s/ John J. Hopper
 	 
	 	 	Name:  	John J. Hopper 	 
	 	 	Title:  	Vice President and
Treasurer 	 
	 
	 	EL PASO NATURAL GAS COMPANY

 	 
	 	By:  	/s/ John J. Hopper
 	 
	 	 	Name:  	John J. Hopper 	 
	 	 	Title:  	Vice President and
Treasurer 	 
	 
	 	TENNESSEE GAS PIPELINE COMPANY

 	 
	 	By:  	/s/ John J. Hopper
 	 
	 	 	Name:  	John J. Hopper 	 
	 	 	Title:  	Vice President and
Treasurer 	 

2

 

	 	 	 	 	 

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A.,	 	 
	 	 	     as a Revolving Lender and Deposit Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

3

 

	 	 	 	 	 	 	 
	 	 	CITICORP NORTH AMERICA, INC.,	 	 
	 	 	     as a Revolving Lender and	 	 
	 	 	     Deposit Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

4

 

	 	 	 	 	 	 	 
	 	 	[Lender],	 	 
	 	 	     as a [Revolving Lender] [and]	 	 
	 	 	     [Deposit Lender]	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

5exv10waw1

 

EXHIBIT 10.A.1

AMENDMENT NO. 1 TO AMENDED AND RESTATED CREDIT AGREEMENT

     AMENDMENT dated as of January 19, 2007 to the Amended and Restated Credit Agreement dated as
of July 31, 2006 (the “Credit Agreement”) among EL PASO CORPORATION, COLORADO INTERSTATE GAS
COMPANY, EL PASO NATURAL GAS COMPANY, TENNESSEE GAS PIPELINE COMPANY, the several banks and other
financial institutions from time to time parties thereto, and JPMORGAN CHASE BANK, N.A., as
administrative agent and as collateral agent.

     The parties hereto agree as follows:

     SECTION 1. Defined Terms; References. Unless otherwise specifically
defined herein, each term used herein that is defined in the Credit Agreement has the meaning
assigned to such term in the Credit Agreement. Each reference to “hereof”, “hereunder”, “herein”
and “hereby” and each other similar reference and each reference to “this Agreement” and each other
similar reference contained in the Credit Agreement shall, after this Amendment becomes effective,
refer to the Credit Agreement as amended hereby.

     SECTION
2. Amendment. The definition of “Consolidated EBITDA” in Section 1.01 of the Credit
Agreement is amended by adding the following new clause (x) immediately before the proviso thereto:

     plus (x) any charges taken during such period in connection with the payment,
repayment, redemption, defeasance, early retirement or refinancing of any debt;

     SECTION
3. Representations of Borrowers. The Borrowers represent and warrant that
(i) the representations and warranties of the Borrowers set forth in Article 4 of the Credit
Agreement will be true on and as of the Amendment Effective Date (as defined below) and (ii) no
Default will have occurred and be continuing on such date.

     SECTION 4. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of New York.

     SECTION 5. Counterparts. This Amendment may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.

     SECTION 6. Effectiveness. This Amendment shall become effective on the
date (the “Amendment Effective Date”) when the Administrative Agent shall have received from each
of the Borrowers and Lenders comprising the Majority Lenders a counterpart hereof signed by such
party or facsimile or other written confirmation (in form satisfactory to the Administrative Agent)
that such party has signed a counterpart hereof.

1

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of
the date first above written.

	 	 	 	 	 
	 	EL PASO CORPORATION

 	 
	 	By:  	/s/ John J. Hopper
 	 
	 	 	Name:  	John J. Hopper 	 
	 	 	Title:  	Vice President and Treasurer 	 
	 

	 	 	 	 	 
	 	COLORADO INTERSTATE GAS COMPANY

 	 
	 	By:  	/s/ John J. Hopper
 	 
	 	 	Name:  	John J. Hopper 	 
	 	 	Title:  	Vice President and Treasurer 	 
	 

	 	 	 	 	 
	 	EL PASO NATURAL GAS COMPANY

 	 
	 	By:  	/s/ John J. Hopper
 	 
	 	 	Name:  	John J. Hopper 	 
	 	 	Title:  	Vice President and Treasurer 	 
	 

	 	 	 	 	 
	 	TENNESSEE GAS PIPELINE COMPANY

 	 
	 	By:  	/s/ John J. Hopper
 	 
	 	 	Name:  	John J. Hopper 	 
	 	 	Title:  	Vice President and
Treasurer 	 

2

 

	 	 	 	 	 

	 	 	 	 	 
	 	JPMORGAN CHASE BANK, N.A.,

     as a Revolving Lender and Deposit Lender

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

3

 

	 	 	 	 	 

	 	 	 	 	 
	 	CITICORP NORTH AMERICA, INC.,

     as a Revolving Lender and

     Deposit Lender

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

4

 

	 	 	 	 	 

	 	 	 	 	 
	 	[Lender],

     as a [Revolving Lender] [and]

     [Deposit Lender]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

5exv4wa

 

EXHIBIT 4.A

[Conformed Copy]

SOUTHERN NATURAL GAS COMPANY

TO

MANUFACTURERS HANOVER TRUST COMPANY,

TRUSTEE

INDENTURE

DATED AS OF JUNE 1, 1987

i

 

SOUTHERN NATURAL GAS COMPANY

Trust Indenture Act Cross Reference Sheet

	 	 	 
	Section of Act	 	Section of Indenture
	310(a)(1) and (2)
	 	Secs. 6.05 and 9.09
	310(a)(3) and (4)
	 	Not Applicable
	310(b)
	 	Secs 9.08 and 9.10
	310(c)
	 	Not Applicable
	311(a) and (b)
	 	Sec. 9.13
	311(c)
	 	Not Applicable
	312(a)
	 	Secs. 7.01 and 7.02(a)
	312(b)
	 	Sec. 7.02(b)
	312(c)
	 	Section 7.02(c)
	313(a)
	 	Section 7.04(a)
	313(b)(1)
	 	Not Applicable
	313(b)(2)
	 	Sec. 7.04(b)
	313(c)
	 	Section 7.04(c)
	313(d)
	 	Section 7.04(d)
	314(a)
	 	Sec. 7.03
	314(b)
	 	Not Applicable
	314(c)
	 	Secs. 14.01 and 16.05
	314(d)
	 	Not Applicable
	314(e)
	 	Sec. 16.05
	314(f)
	 	Not Applicable
	315(a)
	 	Sec. 9.01
	315(b)
	 	Sec. 8.07
	315(c) and (d)
	 	Sec. 9.01
	315(e)
	 	Sec. 8. 08
	316(a)(1)
	 	Secs. 8.01, 8.06 and 10.04
	316(a)(2)
	 	Omitted
	316(b)
	 	Secs. 8.04 and 12.02
	317(a)
	 	Sec. 8.02
	317(b)
	 	Sec. 6.06
	318(a)
	 	Sec. 16.07

TABLE OF CONTENTS*

	 	 	 	 	 
	 	 	Page
	Parties 
	 	 	1	 
	Recitals 
	 	 	1	 

 

			
	*	 	This table of contents shall not, for any purpose, be deemed to be a part of
the Indenture.

ii

 

	 	 	 	 	 
	 	 	Page
	ARTICLE ONE
	 	 	 	 
	Definitions
	 	 	 	 
	 
	 	 	 	 
	Section 1.01. Certain terms defined; other terms defined in Trust Indenture Act of
1939 or in Securities Act of 1933 to have meanings therein assigned
	 	 	1	 
	Authenticating Agent
	 	 	1	 
	Board of Directors
	 	 	1	 
	Business Day
	 	 	1	 
	Common Stock
	 	 	2	 
	Company
	 	 	2	 
	Eligible Obligations
	 	 	2	 
	Event of Default
	 	 	2	 
	Holder
	 	 	2	 
	Indenture
	 	 	2	 
	Interest
	 	 	2	 
	Lien
	 	 	2	 
	Liquefied Natural Gas
	 	 	2	 
	Officers’ Certificate
	 	 	2	 
	Opinion of Counsel
	 	 	3	 
	Original Issue Discount Security
	 	 	3	 
	Outstanding
	 	 	3	 
	Paying Agent
	 	 	3	 
	Person
	 	 	4	 
	Place of Payment
	 	 	4	 
	Preferred Stock
	 	 	4	 
	Principal Office of the Trustee
	 	 	4	 
	Redemption Date
	 	 	4	 
	Redemption Price
	 	 	4	 
	Responsible Officer
	 	 	4	 
	Restricted Subsidiary
	 	 	4	 
	Securities
	 	 	5	 
	Subsidiary
	 	 	5	 
	Synthetic Fuel
	 	 	5	 
	Trustee
	 	 	5	 
	Trust Indenture Act of 1939
	 	 	5	 
	U.S. Government Obligation
	 	 	6	 
	Vice President
	 	 	6	 
	Yield to Maturity
	 	 	6	 
	Section 1.02. Meaning of words importing singular number and plural number; words used
in conjunctive or disjunctive order; the terms “herein”, “hereof” and
“hereunder”; and accounting terms
	 	 	6	 
	 
	 	 	 	 
	ARTICLE TWO
	 	 	 	 
	 
	 	 	 	 
	Security Forms
	 	 	 	 
	 
	 	 	 	 
	Section 2.01. Forms Generally
	 	 	6	 

iii

 

	 	 	 	 	 
	 	 	Page
	Section 2.02. Form of Trustee’s Certificate of Authentication
	 	 	7	 
	 
	 	 	 	 
	ARTICLE THREE
	 	 	 	 
	 
	 	 	 	 
	The Securities
	 	 	 	 
	 
	 	 	 	 
	Section 3.01. Amount of Securities Unlimited; Issuable in Series
	 	 	8	 
	Section 3.02. Denominations of Securities
	 	 	9	 
	Section 3.03. Authentication and Dating
	 	 	9	 
	Section 3.04. Execution of Securities
	 	 	10	 
	Section 3.05. Registration, exchange and transfer of Securities
	 	 	11	 
	Charges upon exchange, transfer or registration of Securities
	 	 	11	 
	Restriction on transfers or exchanges at time of redemptions and certain
interest payments
	 	 	11	 
	Section 3.06. Temporary Securities
	 	 	11	 
	Section 3.07. Mutilated, destroyed, lost or stolen Securities
	 	 	12	 
	Section 3.08. Payment of interest; interest rights reserved
	 	 	13	 
	Section 3.09. Cancellation of surrendered Securities
	 	 	13	 
	Section 3.10. Computation of Interest
	 	 	13	 
	 
	 	 	 	 
	ARTICLE FOUR
	 	 	 	 
	 
	 	 	 	 
	Redemption of Securities
	 	 	 	 
	 
	 	 	 	 
	Section 4.01. Applicability of Article
	 	 	14	 
	Section 4.02. Notice of Redemption; Selection of Securities
	 	 	14	 
	Section 4.03. Payment of Securities Called for Redemption
	 	 	14	 
	 
	 	 	 	 
	ARTICLE FIVE
	 	 	 	 
	 
	 	 	 	 
	Sinking Funds
	 	 	 	 
	 
	 	 	 	 
	Section 5.01. Applicability of Article
	 	 	15	 
	Section 5.02. Mandatory Sinking Fund Payments
	 	 	15	 
	Section 5.03. Credits Against Mandatory Sinking Fund
	 	 	16	 
	Section 5.04. Certificates
	 	 	16	 
	Section 5.05. Manner of Redeeming Securities for Sinking Fund
	 	 	17	 
	 
	 	 	 	 
	ARTICLE SIX
	 	 	 	 
	 
	 	 	 	 
	Particular Covenants of the Company
	 	 	 	 
	 
	 	 	 	 
	Section 6.01 Payment of principal of (and premium, if any) and interest on Securities
	 	 	17	 
	Section 6.02. Maintenance of office or agency for payment of Securities
	 	 	17	 
	Section 6.03. Corporate existence
	 	 	18	 

iv

 

	 	 	 	 	 
	 	 	Page
	Section 6.04. Company to secure Securities ratably with certain mortgages, pledges or
other liens or encumbrances
	 	 	23	 
	Section 6.05. Appointment to fill a vacancy in the office of Trustee
	 	 	23	 
	Section 6.06. (a) Duties of Paying Agent
	 	 	24	 
	(b) Company as Paying Agent
	 	 	24	 
	(c) Turnover to Trustee by Paying Agent or Company
	 	 	24	 
	(d) and (e) Holding sums in trust
	 	 	24	 
	Section 6.07. Annual certificate
	 	 	24	 
	Section 6.08. Waiver of certain covenants
	 	 	25	 
	 
	 	 	 	 
	ARTICLE SEVEN
	 	 	 	 
	 
	 	 	 	 
	Holders’ Lists and Reports by the Company and the Trustee
	 	 	 	 
	 
	 	 	 	 
	Section 7.01 Company to furnish Trustee information as to names and
addresses of Holders
	 	 	25	 
	Section 7.02. (a) Trustee to preserve information as to names and addresses of Holders
	 	 	25	 
	Trustee may destroy list of Holders on certain conditions
	 	 	25	 
	(b) Trustee to make information as to name and addresses of Holders
available to “applicants” or mail communications to Holders in
certain circumstances
	 	 	25	 
	Procedure if Trustee elects not to make information available to
“applicants”
	 	 	26	 
	(c) Company and Trustee not accountable for disclosure of information
	 	 	26	 
	Section 7.03. (a) Annual and other reports to be filed by Company with Trustee
	 	 	26	 
	(b) Additional information and reports to be filed with Trustee and
Securities and Exchange Commission
	 	 	27	 
	(c) Summaries of information and reports to be transmitted by Company
to Holders
	 	 	27	 
	Section 7.04. (a) Trustee to transmit annual report to Holders
	 	 	27	 
	(b) Trustee to transmit certain further reports to Holders
	 	 	28	 
	(c) To what Holders reports are to be mailed
	 	 	28	 
	(d) Copies of reports to be filed with stock exchanges and Securities
and Exchange Commission
	 	 	28	 
	 
	 	 	 	 
	ARTICLE EIGHT
	 	 	 	 
	 
	 	 	 	 
	Remedies of the Trustee and Holders on Event of Default
	 	 	 	 
	 
	 	 	 	 
	Section 8.01. Events of Default defined
	 	 	28	 
	Acceleration of maturity upon Event of Default
	 	 	28	 
	Waiver of default and rescission of declaration of acceleration
	 	 	28	 
	Restoration of former position and rights upon curing
	 	 	30	 
	Section 8.02. Covenant of Company to pay to Trustee whole amount due on Securities
on default in payment of interest or principal (or premium, if any)
	 	 	30	 

v

 

	 	 	 	 	 
	 	 	Page
	Trustee may recover judgment for whole amount due on Securities on
failure of Company to pay
	 	 	30	 
	Filing of proof of claim by Trustee in bankruptcy, reorganization,
arrangement, receivership or other judicial proceeding
	 	 	31	 
	Rights of action and of asserting claims may be enforced by Trustee
without possession of Securities
	 	 	32	 
	Section 8.03. Application of moneys collected by Trustee
	 	 	32	 
	Section 8.04. Limitations on suits by Holders
	 	 	32	 
	Section 8.05. Remedies cumulative
	 	 	33	 
	Delay or omission in exercise of rights not a waiver of default
	 	 	33	 
	Section 8.06. Rights of Holders of majority in principal amount of Securities to
direct Trustee and to waive defaults
	 	 	33	 
	Section 8.07 Trustee to give notice of defaults known to it, but may withhold in
certain circumstances
	 	 	34	 
	Section 8.08 Requirements of an undertaking to pay costs in certain suits under this
Indenture or against the Trustee
	 	 	34	 
	 
	 	 	 	 
	ARTICLE NINE
	 	 	 	 
	 
	 	 	 	 
	Concerning the Trustee
	 	 	 	 
	 
	 	 	 	 
	Section 9.01 Upon Event of Default occurring and continuing, Trustee shall exercise
powers vested in it, and use same degree of care and skill in their
exercise as a prudent man would use
	 	 	34	 
	Trustee not relieved from liability for negligence or willful misconduct
except as provided in this Section
	 	 	34	 
	(a) Prior to Event of Default and after the curing of all Events of
Default which may have occurred
	 	 	34	 
	(1) Trustee not liable except for performance of duties
specifically set forth
	 	 	35	 
	(2) In absence of bad faith, Trustee may conclusively rely on
certificates or opinions furnished it hereunder, subject to
duty to examine certain thereof
	 	 	35	 
	(b) Trustee not liable for error of judgment made in good faith by
Responsible Officer unless Trustee negligent
	 	 	35	 
	(c) Trustee not liable for action or nonaction in accordance with direction
of Holders of majority in principal amount of Securities
	 	 	35	 
	Trustee not required to incur unreasonable financial risk
	 	 	35	 
	Section 9.02. Subject to provisions of Section 9.01

	 	 	 	 
	(a) Trustee may rely on documents believed genuine and properly
	 	 	35	 
	(b) Sufficient evidence by certain instruments provided for
	 	 	35	 
	(c) Trustee may act on Opinion of Counsel
	 	 	35	 
	(d) Trustee may require indemnity from Holders
	 	 	36	 
	(e) Trustee not liable for actions in good faith believed to be
authorized
	 	 	36	 

vi

 

	 	 	 	 	 
	 	 	Page
	(f) Trustee not bound to make investigation into facts except under
certain circumstances
	 	 	36	 
	(g) Trustee may act by or through agents or attorneys
	 	 	36	 
	Section 9.03. Trustee or Authenticating Agent not liable for recitals herein or in
Securities
	 	 	36	 
	No representations by Trustee as to validity of Indenture or of
Securities
	 	 	36	 
	Trustee or Authenticating Agent not accountable for use of Securities or
proceeds
	 	 	36	 
	Section 9.04. Trustee, Authenticating Agent, Paying Agent or Security registrar may
own Securities
	 	 	36	 
	Section 9.05. Moneys received by Trustee to be held in trust without interest
	 	 	36	 
	Section 9.06. Trustee entitled to compensation reimbursement and indemnity
	 	 	37	 
	Obligations to Trustee to be secured by lien prior to Securities
	 	 	37	 
	Section 9.07. Right of Trustee to rely on Officers’ Certificate where no other
evidence specifically prescribed
	 	 	37	 
	Section 9.08. (a) Trustee acquiring conflicting interest to eliminate conflict or
resign
	 	 	37	 
	(b) Notice to Holders in case of failure to comply with subsection (a)
	 	 	37	 
	(c) Definition of conflicting interest
	 	 	37	 
	(d) Definition of certain terms
	 	 	40	 
	 Calculation of percentages of securities
	 	 	41	 
	Section 9.09. Requirements for eligibility of Trustee
	 	 	42	 
	Section 9.10. (a) Resignation of Trustee
	 	 	42	 
	(b) Removal of Trustee by Company or by court on Holders’ application
	 	 	42	 
	(c) Removal of Trustee by Holders of majority in principal amount of
Securities
	 	 	43	 
	(d) Time when resignation or removal of Trustee effective
	 	 	43	 
	Section 9.11. Acceptance by succession of a Trustee
	 	 	43	 
	Notice of succession of a Trustee
	 	 	44	 
	Section 9.12. Successor to Trustee by merger, consolidation or succession to business
	 	 	44	 
	Section 9.13. (a) Limitations on rights of Trustee as a creditor to obtain payment
of certain claims within four months prior to default or during
default, or to realize on property as such creditors thereafter
	 	 	45	 
	(b) Certain creditor relationships excluded
	 	 	47	 
	(c) Definition of certain terms
	 	 	47	 
	Section 9.14. Appointment of Authenticating Agent
	 	 	48	 
	 
	 	 	 	 
	ARTICLE TEN
	 	 	 	 
	 
	 	 	 	 
	Concerning the Holders
	 	 	 	 
	 
	 	 	 	 
	Section 10.01. Evidence of action by Holders
	 	 	49	 
	Section 10.02. Proof of execution of instruments and of holding of Securities
	 	 	49	 
	Section 10.03. Who may be deemed owners of Securities
	 	 	50	 

vii

 

	 	 	 	 	 
	 	 	Page
	Section 10.04. Securities owned by Company or controlled or controlling companies
disregarded for certain purposes
	 	 	50	 
	Section 10.05. Instruments executed by Holders bind future Holders
	 	 	50	 
	 
	 	 	 	 
	ARTICLE ELEVEN
	 	 	 	 
	 
	 	 	 	 
	Holders’ Meetings
	 	 	 	 
	 
	 	 	 	 
	Section 11.01. Purposes for which meetings may be called
	 	 	51	 
	Section 11.02. Manner of calling meetings
	 	 	51	 
	Section 11.03. Call of meetings by Company or Holders
	 	 	51	 
	Section 11.04. Who may attend and vote at meetings
	 	 	51	 
	Section 11.05. Regulations may be made by Trustee
	 	 	51	 
	Conduct of the meeting
	 	 	52	 
	Voting rights — adjournment
	 	 	52	 
	Section 11.06. Manner of voting at meetings and record to be kept
	 	 	52	 
	Section 11.07. Exercise of rights of Trustee and Holders not to be hindered or delayed
	 	 	53	 
	 
	 	 	 	 
	ARTICLE TWELVE
	 	 	 	 
	 
	 	 	 	 
	Supplemental Indentures
	 	 	 	 
	 
	 	 	 	 
	Section 12.01. Purposes for which supplemental indentures may be entered into without
consent of Holders
	 	 	53	 
	Section 12.02. Modification of Indenture with consent of Holders of a majority in
principal amount of Securities
	 	 	54	 
	Section 12.03. Effect of supplemental indentures
	 	 	55	 
	Section 12.04. Securities may bear notation of changes by supplemental indentures
	 	 	55	 
	Section 12.05. Supplemental indentures not to be in conflict with Trust Indenture Act
of 1939
	 	 	55	 
	Section 12.06. Opinion of Counsel
	 	 	55	 

viii

 

	 	 	 	 	 
	 	 	Page
	ARTICLE THIRTEEN
	 	 	 	 
	 
	 	 	 	 
	Consolidation, Merger and Sale
	 	 	 	 
	 
	 	 	 	 
	Section 13.01. Consolidations and mergers of Company and conveyances permitted
	 	 	56	 
	Section 13.02. Assumption of obligations of Company by successor company or transferee
	 	 	56	 
	 
	 	 	 	 
	ARTICLE FOURTEEN
	 	 	 	 
	 
	 	 	 	 
	Satisfaction and Discharge of Indenture; Unclaimed Moneys
	 	 	 	 
	 
	 	 	 	 
	Section 14.01. Satisfaction and discharge of Indenture
	 	 	56	 
	Section 14.02. Application of trust moneys
	 	 	57	 
	Section 14.03. Repayment of moneys held by Paying Agent
	 	 	58	 
	Section 14.04. Repayment of moneys held by Trustee
	 	 	58	 
	 
	 	 	 	 
	ARTICLE FIFTEEN
	 	 	 	 
	 
	 	 	 	 
	Defeasance and Convenant Defeasance
	 	 	 	 
	 
	 	 	 	 
	Section 15.01 Applicability of Article; Company’s option to effect defeasance or
convenant defeasance
	 	 	58	 
	Section 15.02. Defeasance and discharge
	 	 	58	 
	Section 15.03. Covenant defeasance
	 	 	58	 
	Section 15.04. Conditions to defeasance or covenant defeasance
	 	 	59	 
	Section 15.05. Deposited money, Eligible Obligations or U.S. Government Obligations to be
held in trust
	 	 	60	 
	 
	 	 	 	 
	ARTICLE SIXTEEN
	 	 	 	 
	 
	 	 	 	 
	Miscellaneous Provisions
	 	 	 	 
	 
	 	 	 	 
	Section 16.01. Successors and assigns of Company bound by Indenture
	 	 	60	 
	Section 16.02. Acts of board, committee or officer of successor corporation valid
	 	 	60	 
	Section 16.03. Required notices or demands may be served by mail
	 	 	60	 
	Section 16.04. Indenture and Securities to be construed in accordance with the laws of the
State of New York
	 	 	61	 
	Section 16.05. Officers’ Certificate and Opinion of Counsel to be furnished upon
applications or demands by the Company
	 	 	61	 
	Statements to be included in each certificate or opinion with respect to
compliance with a condition or convenant
	 	 	61	 
	Reliance, as to legal matters and factual matters, by officers and counsel,
respectively
	 	 	61	 

ix

 

	 	 	 	 	 
	 	 	Page
	Section 16.06. Provisions of the Indenture and Securities for the sole benefit of the
parties and the Holders
	 	 	61	 
	Section 16.07. Provisions required by Trust Indenture Act of 1939 to control
	 	 	62	 
	Section 16.08. Indenture may be executed in counterparts
	 	 	62	 
	Section 16.09. Table of contents and headings for convenience only
	 	 	62	 
	Section 16.10. Separability Clause
	 	 	62	 
	Section 16.11. Legal Holidays
	 	 	62	 
	Section 16.12. Incorporators, stockholders, officers and directors of Company exempt from
individual liability
	 	 	62	 
	Acceptance of Trust 
	 	 	62	 
	Testimonium 
	 	 	63	 
	Signatures and Seals
	 	 	71	 
	Acknowledgments
	 	 	73	 

x

 

          INDENTURE, dated as of June 1, 1987, between SOUTHERN NATURAL GAS
COMPANY a corporation duly organized and existing under the laws of the State of
Delaware (hereinafter sometimes referred to as the “Company”), and MANUFACTURERS
HANOVER TRUST COMPANY, a corporation organized and existing under the laws of
the State of New York (hereinafter sometimes referred to as the “Trustee”).

RECITALS OF THE COMPANY

          The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
“Securities”), to be issued in one or more series as in this Indenture provided.

          All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.

          NOW THEREFORE, THIS INDENTURE WITNESSETH:

          For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Securities or of series
thereof, as follows:

ARTICLE ONE

Definitions

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

Authenticating Agent:

          The term “Authenticating Agent” shall mean any person authorized by the
Trustee to act on behalf of the Trustee to authenticate Securities.

Board of Directors:

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

Business Day:

          The term “Business Day”, when used with respect to any Place of
Payment, shall mean a day which is not a day on which banking institutions in
that Place of Payment are authorized or obligated by law to close.

          

1

 

Common Stock:

          The term “Common Stock” shall mean stock which has no preference over
any other class of stock with respect to dividends or assets, which is not
redeemable at the option of the issuer thereof and with respect to which no
sinking, purchase or similar fund is provided.

Company:

          The term “Company” shall mean Southern Natural Gas Company and, subject
to the provisions of Article Thirteen, shall also include its successors and
assigns.

Eligible Obligations:

          The term “Eligible Obligations” shall mean interest bearing obligations
as a result of the deposit of which the Securities are rated in the highest
generic long-term debt rating category assigned to legally defeased debt by one
or more nationally recognized rating agencies.

Event of Default:

          The term “Event of Default” shall have the meaning specified in Section
8.01.

Holder:

          The terms “Holder”, “Holder of Securities”, “registered Holder” or
other similar term shall mean the person or persons in whose name or names a
particular Security shall be registered on the books of the Company kept for
that purpose in accordance with the terms of this Indenture.

Indenture:

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

Interest:

          The term “interest”, when used with respect to an Original Issue
Discount Security which by its terms bears interest only after maturity, shall
mean interest payable after maturity.

Lien:

          The term “Lien” shall mean any mortgage, pledge, lien, encumbrance or
other security interest which secures the payment or performance of an
obligation.

Liquified Natural Gas:

          The term “Liquified Natural Gas” shall mean natural gas converted to a
liquid form and which subject to regasification.

Officers’ Certificate:

          The term “Officers’ Certificate” shall mean a certificate signed by the
Chairman of the

2

 

Board, the President or any Vice President and by the Treasurer, the Secretary,
an Assistant Treasurer or an Assistant Secretary of the Company. Each such
certificate shall include the statements provided for in Section 16.05, if and
to the extent required by the provisions thereof.

Opinion of Counsel:

          The term “Opinion of Counsel” shall mean an opinion in writing signed
by legal counsel who may be an employee of or of counsel to the Company or who
may be other counsel satisfactory to the Trustee. Each such opinion shall
include the statements provided for in Section 16.05, if and to the extent
required by the provisions thereof.

Original Issue Discount Security:

          The term “Original Issue Discount Security” shall mean any Security
which provides for an amount less than the principal amount thereof to be due
and payable upon a declaration of acceleration of the maturity thereof pursuant
to Section 8.01.

Outstanding:

          The term “Outstanding”, when used with reference to Securities shall
subject to the provisions of Section 10.04, mean as of any particular time, all
Securities authenticated and delivered by the Trustee under this Indenture
except:

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

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

     (c) Securities in lieu of or in substitution for which other
Securities shall have been authenticated and delivered pursuant to the
terms of Section 3.07, other than any such Securities in respect of
which there shall have been presented to the Trustee proof satisfactory
to it that such Securities are held by a bona fide purchaser in whose
hands such securities are valid obligations of the Company.

          In determining whether the Holders of the requisite principal amount of
outstanding Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, the principal amount of an Original Issue
Discount Security that shall be deemed to be Outstanding for such purposes shall
be the amount of the principal thereof that would be due and payable as of the
date of such determination upon a declaration of acceleration of the maturity
thereof pursuant to Section 8.01.

Paying Agent:

          The term “Paying Agent” shall mean any person authorized by the Company
to pay the principal of and premium, if any, or interest on any Securities on
behalf of the Company.

3

 

     Person:

          The term “person” shall mean any individual, corporation, partnership,
joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.

     Place of Payment:

          The term “Place of Payment”, when used with respect to the Securities
of any series, means the place or places where the principal of and premium if
any, and interest on the Securities of that series are payable as specified as
contemplated by Section 3.01.

     Preferred Stock:

          The term “Preferred Stock” shall mean capital stock of any class other
than Common Stock.

Principal Office of the Trustee:

          The term “Principal Office of the Trustee”, or other similar term,
shall mean the principal office of the Trustee in the Borough of Manhattan, The
City of New York, at which at any particular time its corporate trust business
shall be administered.

Redemption Date:

          The term “Redemption Date”, when used with respect to any Security to
be redeemed, shall mean the date fixed for such redemption pursuant to this
Indenture

Redemption Price:

          The term “Redemption Price”, when used with respect to any Security to
be redeemed, shall mean the price at which it is to be redeemed pursuant to this
Indenture

Responsible Officer:

          The term “Responsible Officer”, when used with respect to the Trustee,
shall mean the chairman of the board of directors, any vice-chairman of the
board of directors, the president, the chairman of the executive committee, the
chairman of the trust committee, any Vice President, any assistant vice
president, the secretary, any assistant secretary, the treasurer, any trust
officer any assistant trust officer, and any other officer or assistant officer
of the Trustee customarily performing 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 his knowledge of and familiarity
with the particular subject.

Restricted Subsidiary:

          The term “Restricted Subsidiary” shall mean an operating Subsidiary (i)
substantially all of the business of which is carried on, in the continental
United States, (ii) the primary business of which consists of the acquisition,
owning, holding, development or operation of assets or properties (directly, and
not through ownership of capital stock of, or partnership, association or other
participation in, other persons, whether corporations, partnerships,
unincorporated

          
4

 

associations, joint ventures or other separate entities) for the exploration
for, or purchase, development, storage, conservation, processing, production or
transmission of, natural gas, oil or other hydrocarbons or reserves thereof, and
(iii) all of the shares of capital stock of which at the time outstanding, other
than director’s qualifying shares, if any, are owned directly or indirectly by
the Company or by one or more of its other Restricted Subsidiaries; provided,
however, that once a Subsidiary shall have become a Restricted Subsidiary, as
such term is defined above, it shall be deemed to remain a Restricted Subsidiary
for all purposes of this Indenture even if less than all such shares of capital
stock are so owned so long as at least a majority of the outstanding shares of
its capital stock having by the terms thereof ordinary voting power to elect a
majority of its Board of Directors (irrespective of whether at the time stock of
any other class or classes of such corporation, association or business trust
shall have, or might have, voting power by reason of the happening of any
contingency) is owned directly or indirectly by the Company of by one of more of
its other Restricted Subsidiaries or by the Company in conjunction with one or
more of its other Restricted Subsidiaries.

Securities:

          The term “Securities” shall have the meaning stated in the first
recital of this Indenture and more particularly shall mean any Securities
authenticated and delivered under this Indenture.

Subsidiary:

          The term “Subsidiary” shall mean a corporation, association or business
trust more than 50% of the outstanding shares of capital stock of which having
by the terms thereof ordinary voting power to elect a majority of its Board of
Directors (irrespective of whether at the time stock of any other class or
classes of such corporation, association or business trust shall have, or might
have, voting power by reason of the happening of any contingency) is owned
directly or indirectly by the Company or by one or more of its other
Subsidiaries or by the Company in conjunction with one or more of its other
Subsidiaries.

Synthetic Fuel:

          The term “Synthetic Fuel” shall mean gas, liquid fuels and related
by-products produced by the conversion of coal, oil, naphtha, oil, shale, or any
other substance, but shall not include gas produced by regasification of
Liquified Natural Gas.

Trustee:

          The term “Trustee” shall mean Manufacturers Hanover Trust Company until
a successor trustee shall have become such pursuant to the provisions of Article
Nine hereof, and thereafter “Trustee” shall mean or include each person who is
then a Trustee hereunder, and if at any time there is more than one such person,
“Trustee” as used with respect to the Securities of any series shall mean the
Trustee with respect to Securities of that series.

Trust Indenture Act of 1939:

          The term “Trust Indenture Act of 1939” shall, subject to the provisions
of Section 12.05, mean the Trust Indenture Act of 1939 as it was in force at the
date of execution of this Indenture.

          
5

 

U.S. Government Obligation:

          The term “U.S. Government Obligation” shall mean (i) a direct
obligation of, or an obligation the principal of and interest on which are fully
guaranteed by, the United States of America (provided that such obligation is
not callable or redeemable at the option of the issuer thereof), or (ii) a
depository receipt issued by a bank or trust company as custodian with respect
to any U.S. Government Obligation described in clause (i) or a specific payment
of interest on or principal of any such U.S. Government Obligation held by such
custodian for the account of the holder of a depository receipt, provided that
(except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository receipt from
any amount received by the custodian in respect of the U.S. Government
Obligation or the specific payment of interest on or principal of the U.S.
Government Obligation evidenced by such depository receipt, or (iii) a security
that is backed by any U.S. Government Obligation described in clause (i) as
collateral under an arrangement by which the principal and interest payments on
the collateral generally flow directly through to the holder of the security.

Vice President:

          The term “Vice President” shall mean any vice president, whether or not
designated by a number or a word or words added before or after the title “vice
president”.

Yield to Maturity:

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

          SECTION 1.02. Unless herein otherwise provided, or unless the context
shall otherwise require, words importing the singular number shall include the
plural number and vice versa: words or phrases employed in the conjunctive order
shall be construed as employed also in the disjunctive order, and vice versa:
the terms “herein”, “hereof” and “hereunder”, or other similar terms, refer to
this Indenture as a whole and not only to the particular sentence, paragraph or
Section in which any such terms may be employed: all accounting terms not
otherwise defined herein have the meanings assigned to them in accordance with
generally accepted accounting principles, and the term “generally accepted
accounting principles” shall mean such accounting principles as are generally
accepted at the date of the execution of this Indenture.

ARTICLE TWO

Security Forms

          SECTION 2.01. The Securities of each series shall be in substantially
the form as shall be established by or pursuant to a resolution of the Board of
Directors or in one or more indentures supplemental hereto, in each case with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture, and may have such letters, numbers
or other marks of identification and such legends or endorsements placed thereon
as may be required to comply with any law or with any rules made pursuant
thereto or with any rules of any securities exchange or as may, consistently
herewith, be determined by the officers executing such Securities, as evidenced
by their execution of the Securities.

          The definitive Securities shall be engraved or lithographed or printed
with engraved borders or may be produced in any other manner, all as determined
by the officers executing such

          
6

 

Securities, as evidenced by their execution of such Securities.

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

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

	 	 	 	 	 	 	 
	 	 	MANUFACTURERS HANOVER TRUST COMPANY	 	 
	 

	 	 	 	as Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Authorized Officer	 	 

7

 

ARTICLE THREE

The Securities

          SECTION 3.01. The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.

          The Securities may be issued in one or more series. There shall be
established in or pursuant to a resolution of the Board of Directors or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of any series,

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

     (2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Securities of the series pursuant to Section 3.05, 3.06, 3.07, 4.03 or
12.04);

     (3) the date or dates on which the principal of and premium,
if any, on the Securities of the series is payable;

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

     (5) the place or places where the principal of, and premium,
if any, and any interest on Securities of the series shall be payable:

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

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

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

     (9) if other than the principal amount thereof, the portion of
the principal amount of Securities of the series which shall be payable
upon declaration of acceleration of the maturity thereof pursuant to
Section 8.01 or provable in bankruptcy pursuant to Section 8.02:

8

 

     (10) if other than the currency of the United States of
America, the currency or currencies, including composite currencies, in
which payment of the principal of and premium, if any, and interest on
the Securities of the series shall be payable;

     (11) if the amount of payments of principal of and premium, if
any, or interest on the Securities of the series may be determined with
reference to an index, the manner in which such amounts shall be
determined:

     (12) the application, if any, of either or both of Sections
15.02 or 15.03 to the Securities of the series;

     (13) any Events of Default with respect to Securities of the
series, if not set forth herein;

     (14) any other covenant or warranty included for the benefit
of Securities of the series in addition to (and not inconsistent with)
those included in this Indenture for the benefit of Securities of all
series, or any other covenant or warranty included for the benefit of
Securities of the series in lieu of any covenant or warranty included
in this Indenture for the benefit of Securities of all series, or any
provision that any covenant or warranty included in this Indenture for
the benefit of Securities of all series shall not be for the benefit of
Securities of the series, or any combination of such covenants,
warranties or provisions; and

     (15) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture).

          All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or pursuant
to such resolution of the Board of Directors or in any such indenture
supplemental hereto.

          SECTION 3.02. The Securities of each series shall be issuable in
registered form without coupons in such denominations as shall be specified as
contemplated by Section 3.01. In the absence of any such specification with
respect to the Securities of any series, the Securities of such series shall be
issuable in denominations of $1,000 and any integral multiple thereof.

          SECTION 3.03. At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any series
executed by the Company to the Trustee for authentication. Except as otherwise
provided in this Article Three, the Trustee shall thereupon authenticate and
deliver said Securities to or upon the written order of the Company, signed by
the Chairman of the Board, the President or any Vice President and by the
Treasurer or any Assistant Treasurer. In authenticating such Securities, and
accepting the additional responsibilities under this Indenture in relation to
such Securities, the Trustee shall be entitled to receive at the time of the
initial delivery by the Company of Securities of such series to the Trustee for
authentication, and (subject to Section 9.01) shall be fully protected in
relying upon:

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

9

 

     (2) an executed supplemental indenture, if any;

     (3) an Officers’ Certificate; and

     (4) an Opinion of Counsel prepared in accordance with Section
16.05 which shall also state

     (a) that the form of such Securities has been
established by or pursuant to a resolution of the Board of
Directors or by a supplemental indenture as permitted by
Section 2.01 in conformity with the provisions of this
Indenture;

     (b) that the terms of such Securities have been
established by or pursuant to a resolution of the Board of
Directors or by a supplemental indenture as permitted by
Section 3.01 in conformity with the provisions of this
Indenture;

     (c) that such Securities, when authenticated and
delivered by the Trustee and issued by the Company in the
manner and subject to any conditions specified in such Opinion
of Counsel, will constitute valid and legally binding
obligations of the Company, enforceable in accordance with
their terms, subject to bankruptcy, insolvency, moratorium,
reorganization and other laws of general applicability
relating to or affecting the enforcement of creditors’ rights,
to general equity principles and to such other qualifications
as such counsel shall conclude do not materially affect the
rights of the Holders of such Securities; and

     (d) that authentication and delivery of the
Securities by the Trustee will not violate the terms of this
Indenture.

     (e) that execution and delivery of the Securities by
the Company will not, to the best of such counsel’s knowledge,
violate any order, rule or regulation applicable to the
Company of any country or of any Federal or State regulatory
body or administrative agency or other governmental body
having jurisdiction over the Company o over its properties
(other than in connection or in compliance with the provisions
of the securities or Blue Sky laws of any State).

          The Trustee shall have the right to decline to authenticate and deliver
any Securities under this Section if the Trustee, being advised by counsel,
determines that such action may not lawfully be taken or if the Trustee in good
faith by its Board of Directors or trustees, executive committee, or a trust
committee of directors or trustees and/or Vice Presidents shall determine that
such action would expose the Trustee to personal liability to existing Holders.

          Each Security shall be dated the date of its authentication.

          SECTION 3.04. The Securities shall be signed on behalf of the Company
by the manual or facsimile signature of its Chairman of the Board, its President
or one of its Vice Presidents under its corporate seal, attested by its
Secretary or one of its Assistant Secretaries by his manual or facsimile
signature. Such signatures may be the manual or facsimile signatures of the
present or any future such officers and may be imprinted or otherwise reproduced
on the Securities. The seal of the Company may be in the form of a facsimile
thereof and may be impressed, affixed, imprinted or otherwise reproduced on the
Securities. Only such Securities as shall bear thereon a certificate of
authentication substantially in the form set forth in Section 2.02, executed by
the

10

 

Trustee by manual signature of one of its authorized officers, shall be entitled
to the benefits of this Indenture or be valid or obligatory for any purpose.
Such certificate by the Trustee upon any Security executed by the Company shall
be conclusive evidence that the Security so authenticated has been duly
authenticated and delivered hereunder and that the Holder is entitled to the
benefits of this Indenture.

          In case any officer of the Company who shall have signed any of the
Securities shall cease to be such officer before the Securities so signed shall
have been authenticated and delivered by the Trustee, or disposed of by the
Company, such Securities nevertheless may be authenticated and delivered or
disposed of as though the person who signed such Securities had not ceased to be
such officer of the Company; and any Security may be signed, by manual or
facsimile signature, on behalf of the Company by such persons as, at the actual
date of the execution of such Security, shall be the proper officers of the
Company, although at the date of such Security any such person was not such
officer.

          SECTION 3.05. At the option of the Holder, Securities of any series may
be exchanged for a like aggregate principal amount of Securities of the same
series of other authorized denominations. The Securities to be exchanged shall
be surrendered at the office or agency to be maintained by the Company in
accordance with the provisions of Section 6.02 for Securities of such series,
and the Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor the Security or Securities which the Holder making the
exchange shall be entitled to receive, bearing numbers not contemporaneously
outstanding.

          The Company shall keep, at the Principal Office of the Trustee (which
is hereby appointed registrar of the Company for such purpose), a register for
each series of Securities issued hereunder in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of Securities and of transfers of Securities as in this Article Three provided.
Upon due presentation for registration of transfer of any Security of any series
at the office or agency to be maintained by the Company in accordance with the
provisions of Section 6.02 for Securities of such series, the Company shall
execute and the Trustee shall authenticate and deliver in the name of the
transferee or transferees a new Security or Securities of the same series for an
equal aggregate principal amount, and no transfer of any Security shall be valid
unless made at such office.

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

          No service charge shall be made for any exchange or transfer of
Securities, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto, other
than exchanges pursuant to Section 3.06, 4.03 or 12.04 not involving any
transfer.

          The Company shall not be required to make transfers or exchanges of (a)
any Securities of any series for a period of I5 days next preceding any
selection of Securities of that series to be redeemed or (b) any Securities
selected, called or being called for redemption except, in the case of any
Security to be redeemed in pan, the portion thereof not so to be redeemed.

          SECTION 3.06. Pending the preparation of definitive Securities of any
series, the Company may execute and the Trustee shall authenticate and deliver
temporary Securities

11

 

(printed, typewritten, lithographed or otherwise produced) in any authorized
denomination and substantially of the tenor of the definitive Securities in lieu
of which they are issued, but with such omissions, insertions and variations as
may be appropriate for temporary Securities, all as may be approved by the
Chairman of the Board, or a Vice President of the Company authorized by the
Board of Directors to execute the same, such approval to be conclusively
evidenced by his execution thereof. Temporary Securities may contain such
reference to any provisions of the Indenture as may be appropriate. Every such
temporary Security shall be executed by the Company and authenticated by the
Trustee upon the same conditions and in substantially the same manner, and with
the same effect, as the definitive Securities. Without unnecessary delay the
Company will execute and deliver to the Trustee definitive Securities of such
series and thereupon any or all temporary Securities of such series may be
surrendered in exchange therefor without expense to the Holders, at the office
or agency of the Company designated pursuant to Section 6.02 for Securities of
such series, and the Trustee shall authenticate and deliver in exchange for such
temporary Securities an equal Aggregate principal amount of definitive
Securities. Until so exchanged, the temporary Securities of any series shall in
all respects be entitled to the same benefits under this Indenture as definitive
Securities of such series authenticated and delivered hereunder.

          SECTION 3.07. In case any temporary or definitive Security shall become
mutilated or be destroyed, lost or stolen, the Company in the case of any
mutilated Security shall, and in the case of any destroyed, lost or stolen
Security in its discretion may, execute, and upon request by the Company the
Trustee shall authenticate and deliver, a new Security of the same series,
bearing a number not contemporaneously outstanding, in exchange and substitution
for the mutilated Security, or in lieu of and in substitution for the Security
so destroyed, lost or stolen, or, if any such Security shall have matured or
shall be about to mature, instead of issuing a substituted Security, the Company
may pay the same (without surrender thereof, except in the case of a mutilated
Security). In every case the applicant for a substituted Security or for such
payment shall furnish to the Company and to the Trustee and to any and all
Paying Agents of the Company such Security or indemnity as may be required by
them to save each of them harmless, and, in every case of destruction, loss or
theft, the applicant shall also furnish to the Company and to the Trustee
evidence to their satisfaction of the destruction, loss or theft of such
Security and of the ownership thereof. The written request or authorization of
the Chairman of the Board, the President, any Vice President, the Treasurer, any
Assistant Treasurer, the Secretary or any Assistant Secretary of the Company
shall be complete authority to the Trustee for the authentication of any such
substituted Security and for the delivery of the same and to the Trustee and any
Paying Agent of the Company for the making of any such payment. Neither the
Trustee nor any such Paying Agent shall incur any liability to anyone by reason
of anything done or omitted to be done by it in good faith and without
negligence under the provisions of this Section 3.07. Upon the issue of any
substituted Security, the Company may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses connected therewith and in addition a further sum
not exceeding Two Dollars for each Security so issued in substitution.

          Every substituted Security issued pursuant to the provisions of this
Section 3.07 in substitution for any destroyed, lost or stolen Security shall
constitute an additional contractual obligation of the Company, whether or not
the destroyed lost or stolen Security shall be enforceable by anyone at any
time, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities of that series duly issued
hereunder.

          All Securities shall be held and owned upon the express condition that
the provisions of this. Section 3.07 are exclusive with respect to the
replacement or payment of mutilated,

12

 

destroyed, lost or stolen Securities, and shall preclude (to the extent lawful)
any and all other rights or remedies, notwithstanding any law or statute
existing or hereafter enacted to the contrary with respect to the replacement or
payment of negotiable instruments or other securities without their surrender.

          SECTION 3.08. The Holder of a Security of any series at the close of
business on any record date with respect to any interest payment date for
Securities of that series shall be entitled to receive the interest payable on
such interest payment date notwithstanding the cancellation of such Security
upon any transfer or exchange subsequent to such record date and prior to such
interest payment date; provided, however, that if and to the extent the Company
shall default in the payment of interest due on such interest payment date, such
defaulted interest shall be paid by the Company, at its election in each case,
as provided in clause (a) or (b) below:

(a) The Company may make payment of any defaulted interest to the
Holder on a subsequent record date established by notice given by mail
by or on behalf of the Company to Holders of Securities of such series
not less than I5 days preceding such subsequent record date, such
record date to be not less than ten days preceding the date of payment
of such defaulted interest

(b) The Company may make payment of any defaulted interest on the
Securities of any series in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the
Securities of such series may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this clause, such manner of
payment shall be deemed practicable by the Trustee.

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

          SECTION 3.09. All Securities surrendered for the purpose of payment,
redemption, exchange or transfer or delivered in satisfaction in whole or in
part of any sinking fund obligation, shall, if surrendered to the Company or any
Paying Agent, be delivered to the Trustee for cancellation, or if surrendered to
the Trustee, shall be cancelled by it, and no Securities shall be issued in lieu
of any Securities so surrendered or delivered except as expressly permitted by
any of the provisions of this Indenture. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and all Securities so delivered shall be promptly cancelled by the
Trustee. The Trustee shall destroy cancelled Securities and deliver a
certificate of destruction thereof to the Company. If the Company shall acquire
any of the Securities, such acquisition shall not operate as a satisfaction of
the indebtedness represented by such Securities unless and until the same are
delivered to the Trustee for cancellation.

          SECTION 3.10. Except as otherwise specified as contemplated by Section
3.01 for Securities of any series, interest on the Securities of each series
shall be computed on the basis of a year of twelve 30-day months.

13

 

ARTICLE FOUR

Redemption of Securities

          SECTION 4.01. The provisions of this Article shall be applicable to the
Securities of any series which are redeemable before their maturity except as
otherwise specified as contemplated by Section 3.01 for Securities of such
series.

          SECTION 4.02. In case the Company shall desire to exercise the right to
redeem all or, as the case may be, any part of the Securities of any series in
accordance with their terms, it shall fix a Redemption Date and it, or, at its
request, the Trustee in the name of and at the expense of the Company, shall
mail, or cause to be mailed, a notice of such redemption at least 30 and not
more than 60 days prior to the Redemption Date to the Holders of Securities of
such series so to be redeemed as a whole or in part at their last addresses as
the same appear on the Security register for such series. Such mailing shall be
by first class mail. The notice if mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the Holder
receives such notice. In any case, failure to give such notice by mail or any
defect in the notice to the Holder of any Security of a series designated for
redemption as a whole or in part shall not affect the validity of the
proceedings for the redemption of any other Security of such series.

          Each such notice of redemption shall be given in the name of the
Company and shall specify the Redemption Date, the Redemption Price, the Place
of Payment, that payment will be made upon presentation and surrender of such
Securities, that interest accrued to the Redemption Date will be paid as
specified in said notice, and that on and after the Redemption Date interest
thereon or on the portions thereof to be redeemed will cease to accrue. If less
than all the Securities of a series are to be redeemed, the notice to the
Holders of the Securities of such series to be redeemed shall identify the
Securities to be redeemed. In case any Security of a series is to be redeemed in
part only, the notice of redemption shall state the portion of the principal
amount thereof to be redeemed and shall state that on and after the Redemption
Date, upon surrender of such Security, a new Security or Securities of that
series in aggregate principal amount equal to the unredeemed portion thereof
will be issued without charge to the Holder.

          On or prior to the Redemption Date specified in the notice of
redemption given as provided in this Section, the Company will deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust, as provided in Section 6.06) an amount of
money sufficient to redeem on the Redemption Date all the Securities or portions
thereof so called for redemption at the appropriate Redemption Price, together
with accrued interest to the Redemption Date.

          If less than all the Securities of a series are to be redeemed the
Company shall give the Trustee notice, at least 45 days (or such shorter period
acceptable to the Trustee) in advance of the Redemption Date, as to the
aggregate principal amount of Securities of such series to be redeemed and
thereupon the Trustee shall select, by such method as it shall deem fair and
appropriate the Securities of such series or portions thereof (in integral
multiples of $1,000, except as otherwise set forth in the applicable form of
Security) to be redeemed, and shall as promptly as practicable notify the
Company in writing of the numbers of the Securities of such series or portions
thereof so selected.

          SECTION 4.03. If notice of redemption has been given as provided in
Section 4.02 or Section 5.05, the Securities or portions of Securities of the
series with respect to which such

14

 

notice has been given shall become due and payable on the date and at the place
stated in such notice at the applicable Redemption Price, together with interest
accrued to the Redemption Date, and on and after such Redemption Date (unless
the Company shall default in the payment of such Securities or portions thereof
at the Redemption Price, together with interest accrued to such Redemption Date)
interest on the Securities or portions of Securities of any series so called for
redemption shall cease to accrue. On presentation and surrender of such
Securities at the Place of Payment in said notice specified, such Securities, or
the specified portions thereof shall be paid and redeemed by the Company at the
applicable Redemption Price, together with interest accrued thereon to the
Redemption Date; provided. however, that installments of interest becoming due
on or prior to the Redemption Date shall be payable to the Holders of such
Securities, or one or more previous Securities evidencing all or a portion of
the same debt as that evidenced by such particular Securities, registered as
such at the close of business on the relevant record dates according to their
terms and the provisions of Section 3.08.

          If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and premium, if any shall, until
paid, bear interest from the Redemption Date at the rate prescribed therefor in
the Security.

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

ARTICLE FIVE

Sinking Funds

          SECTION 5.01. The provisions of this Article shall be applicable to any
sinking fund for the retirement of Securities of a series except as otherwise
specified as contemplated by Section 3.01 for Securities of such series.

          The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a “mandatory sinking
fund payment”, and any payment in excess of such minimum amount provided for by
the terms of Securities of any series is herein referred to as an “optional
sinking fund payment”.

          SECTION 5.02. Neither the Trustee nor any Paying Agent shall redeem or
purchase any Securities of a series with sinking fund moneys or mail any notice
of redemption of such Securities by operation of the sinking fund during the
continuance of any default in payment of interest on such Securities when due or
of any Event of Default with respect to such Securities, except that if the
notice of redemption of any such Securities shall theretofore have been mailed
in accordance with the provisions hereof, the Trustee or any Paying Agent shall
redeem such Securities if cash sufficient for that purpose shall be deposited
with, or segregated by, it for that purpose in accordance with the terms of this
Article. Except as aforesaid, any moneys in the sinking fund for any such series
at the time when any such default or Event of Default shall occur and any moneys
thereafter paid into such sinking fund shall, during the continuance of such
default or Event of Default, be held as security for the payment of Securities
of the applicable series; provided, however, that in case such default or Event
of Default shall have been cured or waived as provided herein, such moneys shall
thereafter be applied not later than the next sinking fund payment date for
Securities of the applicable series on which such moneys may be applied pursuant
to the provisions of this Article.

15

 

          Any and all sinking fund moneys with respect to the Securities of any
particular series held by the Trustee or any Paying Agent on the maturity date
with respect to Securities of such series and not held for the payment or
redemption of particular Securities, shall be applied by the Trustee or such
Paying Agent, together with other moneys, if necessary, to be deposited
sufficient for the purpose, to the payment of the principal of the Securities of
that series at maturity; provided, however, that if such moneys held by the
Trustee or held or segregated in trust by such Paying Agent are greater than are
necessary for such purpose, the excess thereof shall be paid promptly to the
Company after such date or need no longer be segregated and held in trust by the
Company, as the case may be.

          SECTION 5.03. In lieu of making all or any part of any mandatory
sinking fund payment with respect to any Securities of a series in cash, the
Company may (a) deliver to the Trustee for cancellation Outstanding Securities
of that series theretofore purchased or otherwise acquired by the Company or (b)
take credit for the principal amount of any Securities of that series or
portions thereof which have been redeemed either at the election of the Company
pursuant to the terms of such Securities or through the application of permitted
optional sinking fund payments pursuant to the terms of such Securities;
provided that such Securities have not been previously so credited. Such
Securities shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such mandatory sinking fund payment shall
be reduced accordingly.

          SECTION 5.04. Not less than 45 days prior to each sinking fund payment
date for any series of Securities, the Company shall-deliver to the Trustee:

          1. Certificates (which need not be Officers’ Certificates) stating:

(i) the manner in which the Company will fulfill its mandatory
sinking fund obligation for such series under this Article
Five for such period;

(ii)the amount of cash, if any, which the Company will pay to
the Trustee prior to or not later than the opening of business
on the applicable sinking fund payment date for such series;

(iii) the principal amount of Securities of that series, if
any, which the Company will surrender to the Trustee for
cancellation in lieu of the payment of cash, and that such
Securities have not theretofore been made the basis for the
reduction of a mandatory sinking fund payment;

(iv) the principal amount of any Securities for which credit
is claimed pursuant to clause (b) of Section 5.03, together
with such facts as shall demonstrate that the Company is
entitled to such credit; and

(v) whether the Company intends to exercise its right to make
a permitted optional sinking fund payment with respect to such
series and, if so, specifying the amount of such optional
sinking fund payment which the Company intends to pay.

          2. The Securities, if any, referred to in clause (iii) above.

          In case of a failure by the Company, on or before the time provided
above, to deliver such

16

 

certificates and the Outstanding Securities, if any, the sinking fund payment
due on the next succeeding sinking fund payment date for that series shall be
paid entirely in cash and shall be sufficient to redeem the principal amount of
such Securities subject to a mandatory sinking fund payment, and the Company
shall not be permitted to deliver or credit Securities as provided in Section
5.03 or make any optional sinking fund payment, if any, with respect to such
series.

          SECTION 5.05. The Trustee shall select the Securities to be redeemed
upon such sinking fund payment date in the manner provided in Section 4.02 and
notice thereof shall be given by the Trustee to the Company, and the Company
hereby irrevocably authorizes the Trustee, in the name of and at the expense of
the Company, to give notice on behalf of the Company of the redemption of such
Securities, all in the manner and with the effect provided in Section 4.02,
except that, in addition to the matters required to be included in such notice
by Section 4.02, such notice shall also state that the Securities therein
designated for redemption are to be redeemed through operation of the sinking
fund. Provided the Company shall not default in payment of the sinking fund
obligation, such Securities shall be so redeemed and paid in accordance with
such notice in the manner and with the effect provided in Section 4.03.

          Notwithstanding the foregoing, if at any time the amount of cash to be
paid into the sinking fund on the next succeeding sinking fund payment date with
respect to the Securities of any particular series together with any unused
balance of any preceding sinking fund payment or payments with respect to the
Securities of such series shall not exceed in the aggregate $50,000, the
Trustee, unless requested by the Company, shall not give notice of the
redemption of Securities of such series through the operation of the sinking
fund on the next succeeding sinking fund payment date. Such unused balance of
moneys deposited in the sinking fund shall be added to the sinking fund payment
to be made in cash on the next succeeding sinking fund payment date.

ARTICLE SIX

Particular Covenants of the Company

          SECTION 6.01. The Company will duly and punctually pay or cause to be
paid the principal of and premium, if any, and interest on each of the
Securities of any series at the time and place and in the manner provided in
that series of Securities and in this Indenture. The interest on the Securities
shall be payable without presentation of the Securities and (subject to the
provisions of Section 3.08) only to or upon the written order of the registered
Holders thereof. As a condition precedent to the payment of any installment of
interest on a Security, the Company may require the registered Holder of such
Security to furnish such evidence as will enable the Company to determine
whether it is required by law to deduct or to retain any tax or taxes from the
interest so payable.

          SECTION 6.02. So long as any of the Securities of a series remain
Outstanding, the Company will maintain an office or agency in each Place of
Payment for Securities of that series where the Securities of that series may be
presented for transfer and exchange as in this Indenture provided, where notices
and demands to or upon the Company in respect of the Securities of that series
or of this Indenture may be served and where the Securities of that series may
be presented for payment; provided, however, that at the option of the Company
payment of interest may be made by check mailed to the address of the person
entitled thereto as such address shall appear in the Security register of that
series. Unless otherwise specified as contemplated by the provisions of Section
3.01 with respect to the Securities of any series, such office or agency shall
be the Principal Office of the Trustee. The Company will give to the Trustee
written notice of the

          

17

 

location of any such office or agency and of any change of the location thereof
in the event that such office or agency shall not be the Principal Office of the
Trustee. In case the Company shall fail to maintain such office or agency or
shall fail to give such notice of the location thereof or of any change in the
location thereof, presentations and demands may be made and notices may be
served at the Principal Office of the Trustee. Neither any agent of the Company
maintaining such office or agency nor the Trustee shall be under any duty with
respect to any such presentation, demand or notice, except to mail the same,
postage prepaid, to the Company, at such address as may have been furnished to
it by the Company, or if no such address shall have been furnished, to the
Company at P.O. Box 2563, Birmingham, Alabama 35202.

          The Company may also from time to time designate one or more other
offices or agencies where the Securities of one or more series 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 each Place of Payment for Securities of any series for such
purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and or any change in the location of any such office
or agency.

          Section 6.03 Except as hereinafter in this Section 6.03 expressly
permitted and as permitted by Section 13.01, so long as any of the Securities of
any series remain Outstanding, the Company will not at any time directly or
indirectly create, assume or suffer to exists, and will not cause, suffer or
permit any Restricted Subsidiary to create, assume or suffer to exist otherwise
than in favor of the Company or another Restricted Subsidiary, any Lien upon any
of its properties or assets, real personal or mixed, whether owned at the date
of this Indenture or thereafter acquired, or of or upon or in any income or
profits therefrom without making effective provision, and the Company covenants
that in any such case it will make or cause to be made effective provision, and
the Company convenants that in any such case it will make or cause us to be made
effective provision, whereby the Securities then Outstanding and any other
indebtedness of the Company then entitled thereto shall be secured by such Lien
equally and ratably with any and all other obligations and indebtedness thereby
secured, so long as any such other obligations or indebtedness shall be so
secured.

          Nothing in this Section 6.03 shall be construed to prevent he Company
or any Restricted Subsidiary from creating assuming or suffering to exist Liens
of the following character, to all of which the provisions of the first
paragraph of this Section 6.03 shall not be applicable:

     (a) Any purchase money mortgage or purchase money security
interest created to secure all or part of the purchase price of any
property (or to secure a loan made to enable the Company or any
Restricted Subsidiary to acquire the property described in such
mortgage or in any applicable security agreement), provided that such
mortgage or security interest shall extend only to the property so
acquired, fixed improvements thereon, replacements thereof and the
income and profits therefrom;

     (b) Any Lien existing on any property at the time of the
acquisition thereof, whether or not assumed by the Company or any
Restricted Subsidiary, provided that such Lien shall extend only to the
property so acquired, fixed improvements thereon, replacements thereof
and the income and profits therefrom;

     (c) Any Lien on any property acquired or constructed by the
Company or a Restricted Subsidiary, and created not later than twelve
months after (i) such acquisition or completion of such construction or
(ii) commencement of operation of such property,

18

 

whichever is later; provided that such Lien shall extend only to the
property so acquired or constructed, fixed improvements thereon,
replacements thereof and income and profits therefrom;

     (d) Any Lien on the properties or assets, real personal or mixed
of a Restricted Subsidiary, or of or upon or in any income or profits
therefrom which is outstanding at the time such Restricted Subsidiary
becomes a Restricted Subsidiary;

     (e) Any Lien not otherwise permitted under this Section 6.03, of
or upon or in any of its properties or assets, real, personal or mixed,
or of or upon or in any income or profits therefrom created by the
Company or a Restricted Subsidiary for the purpose or securing funded
indebtedness of the Company and/or such Restricted Subsidiary, provided
that the aggregate amount of all funded indebtedness of the Company and
Restricted Subsidiaries secured by Liens permitted by subdivision (d)
above and this subdivisions (e) shall not exceed an amount equal to 15%
of the consolidated net tangible assets of the Company and its
Restricted Subsidiaries.

     For the purposes of this Section 6.03(e), (a) the term
“consolidated net tangible assets) shall mean the total assets
appearing on a consolidated balance sheet of the Company and its
Restricted Subsidiaries less the following:

(1) intangible assets, such as organization costs and
franchise costs as recorded in the plant account and
unamortized debt discount expense and other
intangible deferred debts (excluding, however, an
prepaid expenses or deferred charges which would be
treated as current assets in accordance with
generally accepted accounting principles);

(2) all current and accrued liabilities (other than
consolidated funded indebtedness) and deferred
credits (other than deferred credits resulting from
gains on reacquisition of debt and deferred
investment tax credits);

(3) all reserves (other than reserves for the
retirement of intangible assets and reserves for
deferred credits (other than deferred credits
resulting from gains on reacquisition of debt and
deferred investment tax credits);

(4) all assets held under any lease the rent under
which is capitalized by the Company of any of its
Restricted Subsidiaries; and

(5) all advance payments for gas which the Federal
Energy Regulatory Commission or any successor agency
having jurisdiction (the “FERC”) has ruled are not
recoverable by amortization to cost of service and
which are recoverable in cash and prepayments for gas
which the FERC has ruled are not includable in the
Company’s cost of service for rate making purposes
and which are not recoverable in gas, cash or other
form of equivalent value;

(b) the term “indebtedness” shall mean all items of
indebtedness which would be included in determining the total
liabilities as show on the liability side of a balance sheet
as of which indebtedness is to be determined, and shall
include indebtedness secured by any Lien on any properties or
assets owned and subject thereto whether or not the
indebtedness secured thereby shall have been assumed,

19

 

and shall also include direct guarantees of indebtedness (as
defined above) of others, provided that the term
“indebtedness” of any person shall not include (i) any
indebtedness evidence of which is held in treasury (but the
subsequent resale for such indebtedness hall be deemed to
constitute the creating such indebtedness) in the necessary
amount to pay, redeem or satisfy such indebtedness, or (iii)
any amount (whether or not included in determining total
liabilities as shown on the liability side of a balance sheet
in accordance with generally accepted accounting principles)
representing capitalized rent under any lease or (iv) any
indirect guarantees or other contingent obligations in respect
of indebtedness of other persons, including agreements,
contingent or otherwise, with such other persons or with third
persons with respect to, or to permit or assure the payment
of, obligations of such other persons, including without
limitation, agreements to purchase or repurchase obligations
of such other persons, including, without limitation,
agreements to purchase or repurchase obligations of such other
persons, to advance or supply funds to, or to invest in, such
other persons, to advance or supply funds to, or to invest in,
such other persons, or to pay for property, products or
services of such other persons (whether or not conveyed,
delivered or rendered); demand charge contracts, through-put,
take-or-pay, keep-well, make-whole or maintenance of working
capital or similar agreements; or guarantees with respect to
rental or other similar periodic payments to be made by such
other persons, including, but without limiting the generality
of foregoing, agreements such as the Guaranty agreement dated
as of June 1, 1968, as amended between Boise Cascade
Corporation, the Company and Parish of Beauregard, Louisiana,
or any similar arrangement; (c) the term “funded indebtedness”
shall mean any indebtedness maturing by its terms more than
one year from the date of determination, including any
indebtedness renewable or extendible at the option of the
obligor to a date later than one year from such date of
determination; and (d) the term “consolidated funded
indebtedness” shall mean the total funded indebtedness
appearing on a consolidated balance sheet of the Company and
its Restricted Subsidiaries, provided that there shall be
included in consolidated funded indebtedness an amount equal
to the par value or voluntary liquidation value, whichever is
higher, of outstanding Preferred Stock (not owned by the
Company or a Restricted Subsidiary) of any Restricted
Subsidiary; all after giving appropriate effect to minority
interests and as determined and prepared in accordance with
generally accepted accounting principles in effect on the date
of the determination thereof.

     (f) Any Lien created or assumed by the Company or a
Restricted Subsidiary on any contract for the sale of
any product or service or any rights thereunder or any
proceeds therefrom, including accounts and other
receivables related to the operation or use of any
property acquired or constructed by the Company or a
Restricted Subsidiary and created not later than twelve
months after (i) such acquisition or completion of such
construction or (ii) commencement of full operation of
such property, whichever is later;

     (g) Any Lien created or assumed by the Company or a
Restricted Subsidiary on coal, geothermal resources,
natural gas, Liquefied Natural Gas or Synthetic Fuel
owned by the Company or a Restricted Subsidiary;

20

 

     (h) Any Lien created or assumed by the Company or a
Restricted Subsidiary for the purpose of securing
indebtedness incurred to finance Liquefied Natural Gas
inventories or storage gas;

     (i) Any Lien created or assumed by the Company or a
Restricted Subsidiary in connection with the issuance of
debt securities the interest on which is excludable from
gross income of the holder of such security pursuant to
Section 103 of the Internal Revenue Code of 1986, as
amended, or any successor section, for the purpose of
financing, in whole or in part, the acquisition or
construction of property to be used by the Company or a
Restricted Subsidiary;

     (j) Any Lien created or assumed by the Company or a
Restricted Subsidiary on coal, geothermal, oil natural
gas or mineral properties owned or leased by the Company
or a Restricted Subsidiary to secure loans to the
Company or a Restricted Subsidiary for the purpose of
developing such properties;

     (k) Any Lien on any office equipment, data
processing equipment (including, without limitation,
motor vehicles, tractors, trailers, marine vessels,
barges, towboats, rolling stock and aircraft) or
drilling, exploration or production equipment
(including, without limitation, platforms and rigs) for
the exploration or development of or production from
oil, gas, hydrocarbon or other mineral properties;

     (l) Any refunding or extension of maturity, in
whole or in part, of any obligation or indebtedness
secured by any Lien crated, existing or assumed in
accordance with the provisions of subdivisions (a)
through (d) above, inclusive, provided that the
principal amount of the obligation or indebtedness
secured by such refunding or extended Lien shall not
exceed the principal amount of the obligation or
indebtedness to be refunded or extended outstanding at
the time of such refunding or extensions, and that such
refunding or extended Lien shall be limited in lien to
the same property that secured the obligation or
indebtedness refunded or extended, and property
substituted therefor and property acquired after the
date thereof and subjected to the lien thereof, in
accordance with the provisions of such refunding or
extension; and that such refunding to extended Lien
shall be limited in lien to the same property that
secured the obligation or indebtedness refunded or
extended, and property substituted therefore and
property acquired after the date thereof and subjected
to the lien thereof, in accordance with the provisions
of such refunding or extensions;

     (m) Any Lien created or assumed to secure loans
maturing within twelve months of the date of creation
thereof and not renewable or extendible by the terms
thereof at the option of the obligor beyond such twelve
months, and made in the ordinary course of business;

     (n) Mechanic’s or materialmen’s liens or any Lien
arising by reason of pledges or deposits to secure
payment of workmen’s compensation or other insurance,
good faith deposits in connection with tenders or leases
of real estate, bids or contracts (other than contracts
for the payment of money), deposits to secure public or
statutory obligations, deposits to secure or in lieu

21

 

of surety, stay or appeal bonds and deposits as security
for the payment of taxes or assessments or other similar
charges;

     (o) Any Lien arising by reason of deposits with or
the giving of any form of security to any governmental
agency or any body created or approved by law or
governmental regulation for any purpose at any time in
connection with the financing of the acquisitions or
construction of property to be used in the business of
the Company or a Restricted Subsidiary, or as required
by law or governmental regulation as a condition to the
transaction of any business or the exercise of any
privilege or license, or to permit the maintenance of
self-insurance or participation in any fund for
liability on any insurance risks or connection with
workmen’s compensation, unemployment insurance, old age
pensions or other social security or to share in the
privileges or benefits required for companies
participating in such arrangements;

     (p) Any Lien which is payable, both with respect to
principal and interest, solely out of the proceeds of
natural gas, oil coal, geothermal resources, other
hydrocarbons or minerals to be produced form the
property subject thereto and to be sold or delivered by
the Company or a Restricted Subsidiary;

     (q) Any rights reserved in others to take or
reserve any part of the natural gas, oil, coal,
geothermal resources, other hydrocarbons or minerals
produced at any time on any property of the Company or a
Restricted Subsidiary;

     (r) Any rights reserved to or vested in any person,
firm, corporation or governmental authority by the terms
of any franchise, grant, lease, license, easement or
permit or by any provision of law with respect to any
property of the Company or a Restricted Subsidiary;

     (s) Any obligations or duties to any municipality
or public authority with respect to any franchise,
grant, license, permit or similar arrangement;

     (t) As to any lease, contract easement or
right-of-way, any Lien on the underlying interests in
the property covered thereby, existing at the time of
acquisition of any such lease, contract, easement or
right-of-way;

     (u) The liens of taxes or assessments for the then
current year or not at the time due, or the liens of
taxes or assessments already due but the validity of
which is being contested in good faith;

     (v) Judgment liens in an aggregate amount not in
excess of $5,000,000, or any judgment lien so long as
the finality of such judgment is being contested and
execution thereon is stayed or which has been appealed
and secured, if necessary, by the filing of an appeal
bond;

     (w) Leases (whether pursuant to sale-and-leaseback
arrangements or otherwise) now or hereafter existing and
any renewals or extensions thereof;

22

 

     (x) Easements or similar encumbrances, the
existence of which does not materially impair the use of
the property subject thereto for the purposes for which
it was acquired;

     (y) Liens upon rights-of-way for pipeline purposes;

     (z) The lien reserved in leases for rent and for
compliance with the terms of the lease in the case of
leasehold estates;

     (aa) Defects and irregularities in the titles to
any property (including rights-of-way) which are not
material to the business of the Company and its
Restricted Subsidiaries considered as a whole;

     (bb) Zoning laws and ordinances;

     (cc) Any Lien created or assumed by the Company or
a Restricted Subsidiary in connection with the sale or
discount, without recourse, or any notes or accounts
receivable; and

     (dd) Any Lien deemed to be created as a result of
the deposit of cash or securities for the purpose of

          If at any time the Company or any restricted Subsidiary shall create or
assume any Lien to which the covenant in the first paragraph of this Section
6.03 is applicable, the Company will promptly deliver to the Trustee an
Officers’ Certificate, stating that such covenant has been complied with, and
Opinion of Counsel, stating that in his option such covenant has been complied
with and that nay instruments executed by the Company or any restricted
Subsidiary in the performance of such covenant complied with the requirements
thereof.

          In the event that the Company or any Restricted Subsidiary shall
hereafter secure the Securities equally and ratably with any other obligation or
indebtedness pursuant to the provisions of this Section 6.03, the Trustee is
hereby authorized to enter into an indenture supplemental hereto and to take
such action, if any, as it may deem advisable to enable it to enforce
effectively the rights of the Holders of the Securities so secured, equally and
ratably with such other obligation or indebtedness.

          Subject to the provisions of Section 9.01, the Trustee may accept an
Officers’ Certificate and Opinion of Counsel as conclusive evidence that any
such supplemental indenture or steps taken to secure the Securities equally and
ratably comply with the provisions of this Section 6.03.

          SECTION 6.04. Subject to Article Thirteen, the Company will do or cause
to be done all things necessary to preserve and keep in full force and effect
its corporate existence and franchises; provided, however, that the Company
shall not be required to preserve any such franchise if the Board of Directors
shall determine that the preservation thereof is no longer desirable in the
conduct of the business of the Company and that the loss thereof is not
disadvantageous in any material respect to the Holders.

          SECTION 6.05. The Company, whenever necessary to avoid or fill a
vacancy in the office of Trustee, will appoint, in the manner provided in
Section 9.10, a Trustee, so that there shall at all times be a Trustee with
respect to each series of Securities hereunder.

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          SECTION 6.06. (a) If the Company shall appoint a Paying Agent other
than the Trustee with respect to the Securities of any series, it will cause
such Paying Agent to execute and deliver to the Trustee an instrument in which
such Paying Agent shall agree with the Trustee, subject to the provisions of
Section 6.06:

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

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

(3) that upon the occurrence and continuance of an Event of
Default it will pay to the Trustee all sums held by it as such
Paying Agent.

     (b) If the Company shall act as its own Paying Agent with
respect to the Securities of any series, it will, on or before each due
date of the principal of and premium, if any, or interest on any of the
Securities of such series, set aside, segregate and hold in trust for
the benefit of the Holders of such Securities a sum sufficient to pay
such principal or premium or interest so becoming due and will give the
Trustee written notice of such action or any failure to take such
action.

     (c) If the Company shall have appointed one or more Paying
Agents with respect to the Securities of any series, it will, on or
before each due date of the principal of and premium, if any, or
interest on any Securities of such series, deposit with a Paying Agent
a sum sufficient to pay the principal of and premium, if any, or
interest so becoming due, such sum to be held in trust for the benefit
of the Holders of such Securities, and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee of its action or
failure so to act.

     (d) Anything in Section 6.06 to the contrary notwithstanding,
the Company may, at any time, for the purpose of obtaining a
satisfaction and discharge of this Indenture, or for any other reason.
pay or cause to be paid to the Trustee all sums held in trust by it, or
any Paying Agent hereunder, as required by this Section, such sums to
be held by the Trustee upon the trusts herein contained.

     (e) Anything in this Section 6.06 to the contrary
notwithstanding, the agreement to hold sums in trust as provided in
this Section 6.06 is subject to the provisions of Sections 14.03 and
14.04.

          SECTION 6.07. Annually, within 120 days after the close of each fiscal
year beginning with the fiscal year ending December 31, 1987, the Company will
deliver to the Trustee a certificate (which shall not be deemed to be an
Officers’ Certificate within the meaning of this Indenture and need not conform
with any of the provisions of Section 16.05) of the Chairman of the Board or the
President or a Vice President and the Secretary or the Treasurer or an Assistant
Sectary or an Assistant Treasurer of the Company, stating that a review of the
activities of the

24

 

Company during such year has been made under their supervision with a view to
determining whether the Company has kept, observed, performed and fulfilled all
its covenants, agreements and obligations under this Indenture, and that to the
best of their knowledge the Company has kept, observed, performed and fulfilled
each and every covenant, agreement and obligation on its pan in this Indenture
contained and that to the best of their knowledge neither the Company nor any
Paying Agent of the Company is in default in the performance, observance or
fulfillment of any of the terms, provisions and conditions hereof, and that no
default (as defined in Section 8.07 for the purposes thereof) exists or, if the
Company or any Paying Agent shall be so in default or if any default, as so
defined, exists, specifying all such defaults, and the nature thereof, of which
they may have knowledge.

          SECTION 6.08. The Company may omit in any particular instance to comply
with any term, provision or condition set forth in Section 6.03 with respect to
the Securities of any series, if before the time for such compliance the Holders
of at least a majority in principal amount of the Outstanding Securities of such
series either waive such compliance in such instance or generally waive
compliance with such term, provision or condition, but no such waiver shall
extend to or affect such term, provision or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee in respect of any such term,
provision or condition shall remain in full force and effect

ARTICLE SEVEN

Holder’s Lists and Reports By the Company And the Trustee

          SECTION 7.01. The Company covenants and agrees that it will furnish or
cause to be furnished to (the Trustee with respect to the Securities of each
series not later than each interest payment date for such series (and on dates
to be determined pursuant to Section 3.01 for any series of Original Issue
Discount Securities which by their terms bear interest only after maturity), but
in no case less frequently than semi-annually, and at such other times as the
Trustee may request in writing, within thirty days after receipt by the Company
of any such request. a list. in such form as the Trustee may reasonably require
of the names and addresses of the Holders as of a date not more than fifteen
days prior to the time such information is furnished but, so long as the Trustee
shall be the Security registrar, no such list shall be required to be furnished.

          SECTION 7.02. (a) The Trustee shall preserve, in as current a form as
is reasonably practicable, all information as to the names and addresses of the
Holders contained in the most recent list furnished to it as provided in Section
7.01 or received by it as Security registrar or Paying Agent (if so acting). The
Trustee may destroy any list furnished to it as provided in Section 7.01 upon
receipt of a new list so furnished.

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

(1) afford such applicants access to the information preserved
at the time by the

25

 

Trustee in accordance with the provisions of subsection (a) of
this Section 7.02, or

(2) inform such applicants as to the approximate number of
Holders of Securities of such series whose names and addresses
appear in the information preserved at the time by the Trustee
in accordance with the provisions of subsection (a) of this
Section 7.02, and as to the approximate cost of mailing to
such Holders the form of proxy or other communication, if any,
specified in such application.

If the Trustee shall elect not to afford such applicants access to such
information, the Trustee shall, upon the written request of such
applicants, mail to each Holder of a Security of such series whose name
and address appear in the information preserved at the time by the
Trustee in accordance with the provisions in subsection (a) of this
Section 7.02, a copy of the form of proxy or other communication which
is specified in such request, with reasonable promptness after a tender
to the Trustee of the material to be mailed and of payment, or
provision for the payment, of the reasonable expenses of mailing,
unless within five days after such tender, the Trustee shall mad to
such applicants and file with the Securities and Exchange Commission
together with a copy of the material to be mailed, a written statement
to the effect that, in the opinion of the Trustee, such mailing would
be contrary to the best interests of the Holders of Securities of such
series or would be in violation of applicable law. Such written
statement shall specify the basis of such opinion. If said Commission,
after opportunity for a hearing upon the objections specified in the
written statement so filed, shall enter an order refusing to sustain
any of such objections, or if, after the entry of an order sustaining
one or more of such objections, said Commission shall find after notice
and opportunity for hearing that all the objections so sustained have
been met and shall enter an order so declaring the Trustee shall mail
copies of such material to all such Holders with reasonable promptness
after the entry of such order and the renewal of such tender; otherwise
the Trustee shall be relieved of any obligation or duty to such
applicants respecting their application.

(c) Each and every Holder of the Securities, by receiving and holding
the same, agrees with the Company and the Trustee that neither the
Company nor the Trustee nor any Paying Agent shall be held accountable
by reason of the disclosure of any such information as to the names and
addresses of the Holders in accordance with the provisions of
subsection (b) of this Section 7.02, regardless of the source from
which such information was derived, and that the Trustee shall not be
held accountable by reason of mailing any material pursuant to a
request made under said subsection (b)

          SECTION 7.03. (a) The Company covenants and agrees to file with the
Trustee, within fifteen days after the Company is required to file the same
with the Securities and Exchange Commission, copies of the annual reports and of
the information, documents and other reports (or copies of such portions of any
of the foregoing as said Commission may from time to time by rules and
regulations prescribe) which the Company may be required to file with said
Commission pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act of 1934; or, if the Company is not required to file information, documents
or reports pursuant to either of such Sections, then the Company will file with
the Trustee and said Commission, in accordance with rules and regulations
prescribed from time to time by said Commission, such of the supplementary and
period information, documents and reports which may be required pursuant to
Section 13 of the Securities Exchange Act of 1934 in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations

26

 

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

(c) The Company covenants and agrees to transmit by mail to all
Holders, at the addresses of such Holders as they appear upon the
registry books of the Company, within thirty days after the filing
thereof with the Trustee, such summaries of any information, documents
and reports required to be filed by the Company pursuant to subsections
(a) and (b) of this Section 7.03 as may be required by rules and
regulations prescribed from time to time by the Securities and Exchange
Commission.

     SECTION 7.04. (a) On or before July 15 each year, commencing in 1988,
so long as any Securities are Outstanding hereunder, the Trustee shall transmit
to the Holders of Securities of all series for which it is Trustee hereunder as
hereinafter in this Section 7.04 provided, a brief report dated as of May I5 of
the year in which such report is made with respect to:

(1) its eligibility under Section 9.09, and its qualifications
under Section 9.08, or in lieu thereof, if to the best of its
knowledge it has continued to be eligible and qualified under
such Sections, a written statement to such effect;

(2) the character and amount of any advances (and if the
Trustee elects so to state, the circumstances surrounding the
making thereof) made by the Trustee (as such) which remain
unpaid on the date of such report, and for the reimbursement
of which it claims or may claim a lien or charge, prior to
that of such Securities, on any property or funds held or
collected by it as Trustee, except that the Trustee shall not
be required (but may elect) to state such advances if such
advances so remaining unpaid aggregate not more than one-half
of one per cent of the principal amount of such Securities
Outstanding on the date of such report;

(3) the amount, interest rate and maturity date of all other
indebtedness owing by the Company (or by any other obligor on
the Securities) to the Trustee in its individual capacity, on
the date of such report, with a brief description of any
property held as collateral security thereon except an
indebtedness based upon a creditor relationship arising in any
manner described in paragraphs (2), (3), (4), or (6) of
subsection (b) of Section 9.13;

(4) the property and funds, if any, physically in the
possession of the Trustee (as such) on the date of such
report;

(5) any additional issue of Securities for which it is the
Trustee hereunder which the Trustee has not previously
reported; and

(6) any action taken by the Trustee in the performance of its
duties under this Indenture which it has not previously
reported and which in its opinion materially affects such
Securities, except action in respect of a default, notice of
which has been or is to be withheld by it in accordance with
the provisions of Section 8.07.

27

 

	 	(b)	 	The Trustee shall transmit to the Holders of Securities of all
series for which it is the Trustee hereunder, as hereinafter
provided, a brief report with respect to the character and amount
of any advances (and if the Trustee elects so to state, the
circumstances surrounding the making thereof) made by the Trustee
(as such) since the date of the last report transmitted pursuant
to the provisions of subsection (a) of this Section 7.04 (or if no
such report has yet been so transmitted, since the date of
execution of this Indenture), for the reimbursement of which it
claims or may claim a lien or charge prior to that of such
Securities on property or funds held or collected by it as
Trustee, and which it has not, previously reported pursuant to
this subsection (b) except that the Trustee shall not be required
(but may elect) to report such advances if such advances remaining
unpaid at any time aggregate ten per cent or less of the principal
amount of such Securities Outstanding at such time. such report to
be transmitted within ninety days after such time.
	 
	 	(c)	 	Reports pursuant to this Section 7.04 shall be transmitted by mail
to the Holders specified in subsections (a) and (b) of this
Section 7.04 at the addresses of such Holders as they appear upon
the registry books of the Company.

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

ARTICLE EIGHT.

          Remedies Of the Trustee And Holders On Event of Default

     SECTION 8.01 In case one or more of the following Events of Default
with respect to Securities of any series shall have occurred and be continuing
that is to say:

(a) default in the payment of any installment of interest upon any
Security of that series, as and when the same shall become due and
payable, and continuance of such default for a period of thirty days:
or

(b) default in the payment of the principal of or premium, if any, on
any Security of that series as and when the same shall become due and
payable either at maturity, upon redemption. or by declaration: or

(c) default in the payment or satisfaction of any sinking fund
obligation, as and when such sinking fund obligation shall become due
and payable by the terms of the Securities of that series, and
continuance of such default for a period of thirty days: or

(d) failure on the part of the Company duly to observe or perform any
other of the covenants or agreements on the part of the Company in this
Indenture (other than a covenant or agreement which has been included
in this Indenture for the benefit of Securities of any series other
than that series) for a period of ninety days (or thirty days in the
case of any of the covenants and agreements contained in Section 6.03)
after the date on which written notice of such failure, requiring the
same to be remedied, and stating that such notice is a “Notice of
Default” hereunder, 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 twenty-five per cent in principal amount of
the Securities of that series

28

 

at the time Outstanding; or

(e) default by the Company or any Restricted Subsidiary (i) in the
payment of any instalment of principal of or interest upon any funded
indebtedness (as defined in Section 6.03(e)) having a then outstanding
principal amount in excess of $10,000,000, the effect of which default
is to cause or permit the trustee or holders of such funded
indebtedness to cause such funded indebtedness to become due and
payable prior to its stated maturity; or (ii) in any other manner as
defined in any instrument evidencing funded indebtedness having a then
outstanding principal amount in excess of $10,000,000, which default
has resulted in the acceleration of such funded indebtedness so that
the same shall have become due and payable prior to its stated
maturity; provided however, that if any default as provided in clause
(i) or (ii) above shall be remedied or cured by the Company or a
Restricted Subsidiary or waived by the trustee or holders of such
funded indebtedness, en each case in accordance with the terms of the
instruments pursuant to which such funded indebtedness shall have been
issued, then the default hereunder by reason thereof shall be deemed
likewise to have been thereupon remedied, cured, or waived without
further action upon part of either the Trustee or any of the Holders;
and provided, further, that subject to the provisions of Section 9.01,
the Trustee shall not be charged with knowledge of any such default
unless either (i) a Responsible Officer of the Trustee assigned to its
corporate trust department shall, as such officer, have actual
knowledge of such default, or (ii) written notice thereof shall have
been given to the Trustee by the Company, by the trustee or holders of
any such funded indebtedness, or by the Holders of not less than five
percent in aggregate principal amount of the Securities of that series
at the time Outstanding; or

(f) a decree or order by a court having jurisdiction in the premises
shall have been entered adjudging the Company or any Restricted
Subsidiary a bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization, arrangement, adjustment, composition,
liquidation, dissolution or winding-up of the Company or any Restricted
Subsidiary or any similar relief under any present or future federal or
state law or regulation, and such decree or order shall have continued
undischarged or unstayed for a period of ninety consecutive days: or a
decree or order of a court having jurisdiction in the premises for the
appointment of a receiver or trustee or assignee in bankruptcy or
insolvency or other similar official of the Company or any Restricted
Subsidiary or of its property, or for the winding-up or liquidation of
its affairs, shall have been entered, and such decree or order shall
have remained in force undischarged and unstayed for a period of ninety
consecutive days; or

(g) the Company or any Restricted Subsidiary shall institute
proceedings to be adjudicated a voluntary bankrupt, or shall consent to
the institution of a bankruptcy proceeding against it, or shall file a
petition or answer or consent seeking reorganization, arrangement.
adjustment, composition, liquidation, dissolution, winding-up or any
similar relief under any present or future federal or state law or
regulation, or shall consent to the filing of any such petition, or
shall consent to the appointment of or the taking possession by a
receiver or trustee or assignee in bankruptcy or insolvency or other
similar official of it or of its property, or shall make ap assignment
for the benefit of creditors, or shall admit in writing its inability
to pay its debts generally as they become due: or

(h) any other Event of Default provided pursuant to Section 3.01 as
part of the terms of and as applicable with respect to Securities of
that series:

29

 

then and in each and every such case, unless the principal of all the Securities
of such series shall have already become due and payable, either the Trustee or
the Holders of not less than twenty-five per cent m aggregate principal amount
of the Securities of such series then Outstanding here-under, by notice in
writing to the Company (and to the Trustee if given by Holders), may declare the
principal amount (or, if the Securities of that series are Original issue
Discount Securities, such portion of the principal amount as may be specified in
the terms of that Series) of all the Securities of such series and the interest
accrued thereon to be due and payable immediately, and upon any such declaration
the same shall become and shall be immediately due and payable, anything in this
Indenture or in the Securities of such series contained to the contrary
notwithstanding. This provision, however, is subject to the condition that if,
at any time after the principal amount (or, if the Securities of that series are
Original Issue Discount Securities, such portion of the principal amount as may
be specified in the terms of that series) of and accrued interest on the
Securities of any series shall have been so declared due and payable, and before
any judgment or decree for the payment of the moneys due shall have been
obtained or entered as hereinafter provided, the Company shall pay or shall
deposit with the Trustee a sum sufficient to pay all matured instalments of
interest upon all of the Securities of such series and the principal df and
premium, if any, on any and all Securities of such series which shall have
become due otherwise than by such declaration (with interest on overdue
instalments of interest to the extent that payment of such interest is
enforceable under applicable law and on such principal and premium, if any, at
the same rate per annum or Yield to Maturity (in the case of Original Issue
Discount Securities) as is borne by the Securities of such series to the date of
such payment or deposit) and the amount payable to the Trustee under Section
9.06, and any and all defaults under the Indenture with respect to the
Securities of such series, other than the nonpayment of principal of and accrued
interest on Securities of such series which shall have become due by such
declaration, shall have been remedied or waived-then and in every such case the
Holders of a majority in aggregate principal amount of the Securities of such
series then Outstanding, by written notice to the Company and to the Trustee,
may consent to the waiver of all defaults with respect to that series and
rescind and annul such declaration and its consequences; but no such waiver or
rescission and annulment shall extend to or shall affect any subsequent default,
or shall impair any fight consequent thereon.

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

     SECTION 8.02. The Company covenants that (1) in case default shall be
made in the payment of any instalment of interest on any of the Securities of
any series, as and when the same shall become due and payable, and such default
shall have continued for a period of thirty days, or (2) in case default shall
be made in the payment of the principal of and premium, if any, on any of the
Securities of any series as and when the same shall have become due and payable,
whether upon maturity of the Securities of that series or upon redemption or by
declaration-then, upon demand of the Trustee, the Company will pay to the
Trustee, for the benefit of the Holders of the Securities of that series, the
whole amount that then shall have become due and payable on all such Securities
of that series for principal and premium, if any, or interest, or both, as the
case may be, with interest at the same rate per annum or Yield to Maturity (in
the case of Original Issue Discount Securities) as is borne by the Securities of
that series upon the overdue principal and premium, if any, and (to the extent
that payment of such interest is enforceable under applicable law) on overdue
instalments of interest; and, in addition thereto, such further sums as

30

 

shall be sufficient to cover the costs and expenses of collection and the amount
payable to the Trustee under Section 9.06.

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

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

     No recovery of any such judgment by the Trustee and no levy of any
execution upon any such judgment upon any of the property of the Company shall
in any manner or to any extent, except as otherwise required by law, affect any
rights, powers or remedies of the Trustee hereunder or any rights, powers or
remedies of the Holders. but such rights, powers and remedies of the Trustee and
of the Holders shall continue unimpaired as before.

     In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor on the Securities of any
series under Federal bankruptcy laws or any other applicable law or in
connection with the insolvency of the Company or any such other obligor or m
case a receiver or trustee shall have been appointed for its property, or any
other judicial proceedings relative to the Company or any such other obligor,
its creditors or its property, the Trustee, irrespective of whether the
principal of the Securities of any series shall then be due and payable as
therein expressed or by declaration or otherwise and irrespective of whether the
Trustee shall have made any demand pursuant to the provisions of this Section
8.02, shall be entitled and empowered, by intervention in such proceedings or
otherwise, to file and prove a claim or claims for the whole amount of
principal, premium, if any, and interest (or, if the Securities of that series
are Original Issue Discount Securities, such portion of the principal amount as
may be specified in the terms of that series) owing and unpaid in respect of the
Securities of such series, and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee and of the
Holders allowed in any judicial proceeding relative to the Company or any other
obligor on the Securities of such series, its creditors, or its property, and to
collect and receive any moneys or other property payable or deliverable on any
such claims, and to distribute the same after the deduction of the amount
payable to the Trustee under Section 9.06; and each Holder hereby appoints the
Trustee the attorney-in-fact for such Holder for such purpose, whether or not
such Holder has filed a separate proof of claim in any such proceeding, and any
receiver, assignee or trustee in bankruptcy or reorganization or other similar
official is hereby authorized by each of the Holders to make such payments to
the Trustee (and each of the Holders hereby waives any right to receive such
payments except from the Trustee), and to pay to the Trustee any amount due it
under Section 9.06. 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 proceeding.

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     All rights of action and of asserting claims under this Indenture, or
under any of the Securities may be enforced by the Trustee without the
possession of any of the Securities, or the production thereof at any trial or
other proceeding relative thereto, and any such suit or proceeding instituted by
the Trustee shall be brought in its own name as trustee of an express trust, and
any recovery or judgment (except for any amounts payable to the Trustee pursuant
to the provisions of Section 9.06) shall be for the ratable benefit of the
Holders of the Securities in respect of which such action was taken.

     SECTION 8.03. Any moneys collected by the Trustee pursuant to Section
8.02, together with any other sums held by the Trustee hereunder (other than
sums held for the payment of a particular Security), shall be applied in the
order following, at the date or dates fixed by the Trustee for the distribution
of such moneys, and as regards the payments provided for in SECOND and THIRD
below upon presentation of the Securities in respect of which moneys have been
collected, and the notation thereon of the payment if only partially paid, and
upon surrender thereof if fully paid:

     FIRST: To the payment of costs and expenses of collection and of all
amounts payable to the Trustee under Section 9.06;

     SECOND: In case the principal and premium, if any, of the Outstanding
Securities in respect of which or for the benefit of which such moneys have been
collected shall not have become due and be unpaid, to the payment of interest in
default on such Securities, in the order of the maturity of the instalments of
such interest, with interest upon the overdue instalments of interest at the
same rate per annum or Yield to Maturity (in the case of Original Issue Discount
Securities) as is borne by the Securities of that series (to the extent that
such interest on overdue instalments of interest shall have been collected and
to the extent that payment of such interest is enforceable under applicable
law), such payments to be made ratably to the persons entitled thereto, without
discrimination or preference;

     THIRD: In case the principal of the Outstanding Securities in respect
of which or for the benefit of which moneys have been collected shall have
become due, by declaration or otherwise, to the payment of the whole amount then
owing and unpaid upon such Securities for principal and premium, if any, and
interest, with interest at the same rate per annum or Yield to Maturity (in the
case of Original Issue Discount Securities) as is borne by such Securities on
the overdue principal and premium, if any, and on overdue instalments of
interest (to the extent that such interest on overdue instalments of interest
shall have been collected and to the extent that payment of such interest is
enforceable under applicable law); and in the case such moneys shall be
insufficient to pay in full the whole amount so due and unpaid upon such
Securities, then to the payment of such principal and premium, if any, and
interest without preference or priority of principal and premium, if any, over
interest, or of interest over principal and premium, if any, or of any
instalment of interest over any other instalment of interest, or of any Security
of any series over any other Security of that series or any other series for
which it is Trustee, ratably to the aggregate of such principal and premium, if
any, and accrued and unpaid interest; and

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

     SECTION 8.04. No Holder of any Security of any series shall have any
right by virtue or by availing of any provision of this Indenture to institute
any suit, action or proceeding in equity

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or at law upon or under or with respect to this Indenture or for the appointment
of a receiver or trustee, or for any other remedy hereunder, unless such Holder
previously shall have given to the Trustee written notice of default and of the
continuance thereof, as hereinbefore provided, and unless also the Holders of
not less than twenty-five per cent in aggregate principal amount of the
Securities of that series then Outstanding shall have made written request upon
the Trustee to institute such action suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee for sixty days after its receipt of
such notice, request and offer of indemnity shall have neglected or refused to
institute any such action, suit or proceeding; it being understood and intended,
and being expressly covenanted by the taker and Holder of every Security with
every other taker and Holder and the Trustee, that no one or more Holders of
Securities shall have any right in any manner whatever by virtue or by availing
of any provision of this Indenture to affect, disturb or prejudice the rights of
any other Holders, or to obtain or seek to obtain priority over or preference to
any other such Holder, or to enforce any right under this Indenture, except in
the manner herein provided and for the equal, ratable and common benefit of all
such Holders.

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

     SECTION 8.05. All rights, powers and remedies given by this Article
Eight to the Trustee or to the Holders shall, to the extent permitted by law, be
deemed cumulative and not exclusive of any thereof or of any other rights,
powers and remedies available to the Trustee or the Holders, by judicial
proceedings or otherwise, to enforce the performance or observance of the
covenants and agreements contained in this Indenture, and no delay or omission
of the Trustee or of any Holder to exercise any right, power or remedy accruing
upon any default occurring and continuing as aforesaid shall impair any such
right, power or remedy, or shall be construed to be a waiver of any such default
or an acquiescence therein; and, subject to the provisions of Section 8.04,
every right, power and remedy given by this Article Eight or by law to the
Trustee or to the Holders may be exercised from time to time, and as often as
shall be deemed expedient, by the Trustee or by the Holders.

     SECTION 8.06. The Holders of a majority in aggregate principal amount
of the Securities of any series at the time Outstanding shall have the right to
direct the time method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee with respect to the Securities of such series; provided however, that
subject to the provisions of Section 9.01 hereof, the Trustee shall have the
right to decline to follow any such direction if the Trustee after consulting
with counsel determines that the action so directed may not lawfully be taken,
or conflicts with the terms of this Indenture or the Securities of any series,
and the Trustee may take any other action deemed proper by the Trustee which is
not inconsistent with such direction. Prior to the declaration of the maturity
of the Securities of any series as provided in Section 8.01 hereof, the Holder
of a majority in aggregate principal amount of the Securities of that series at
the time Outstanding may on behalf of the Holders of an of the Securities of
that series consent to the waiver of any past default hereunder and its
consequences, except a default in the payment of interest, or premium, if any,
on, or the principal of, the Securities of such series. In the case of any such
waiver the Company, the Trustee and the Holders of the Securities of that series
shall be restored to their former positions and rights hereunder, respectively;
but no such waiver shall extend to any subsequent or

33

 

other default or impair any right consequent thereon.

SECTION 8.07. The Trustee shall, within ninety (90) days after the occurrence of
a default with respect to the Securities of any series, mail to all Holders of
Securities of that series, at the addresses of such Holders as they appear upon
the registry books of the Company for such series, notice of all defaults with
respect to Securities of that series known to the Trustee, unless such defaults
shall have been cured before the giving of such notice (the term “defaults” for
the purposes of this Section 8.07 being hereby defined to be the events
specified in clauses (a), (b), (c), (d), (e), (f) and (g) of Section 8.01, not
including any periods of grace provided therein and irrespective of the giving
of written notice as specified in clause (d) of Section 8.0 1 or any notice
pursuant to clause (d) of Section 8.01); provided that, in the case of any
default of the character specified in said clause (d) of Section 8.01, no such
notice shall be given until at least sixty (60) days after the occurrence
thereof, and provided that, except in the case of default in the payment of the
principal of or premium, if any, or interest on any of the Securities of such
series or in the making of any sinking fund payment with respect to such series,
the Trustee shall be protected in withholding such notice if and so long as the
board of directors, the executive committee or a trust committee of directors
and/or Responsible Officers of the Trustee in good faith determine that the
withholding of such notice is in the interests of the Holder of the Securities
of such series.

     SECTION 8.08. All parties to this Indenture agree, and each Holder of
any Security by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for any
action taken or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable attorneys’
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 8.08 shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder of the Securities of any series,
or group of such Holders, holding in the aggregate more than ten per cent in
principal amount of the Outstanding Securities of that series, or to any suit
instituted by any Holder for the enforcement of the payment of the principal of
and premium, if any, or interest on any Security, on or after the due date
expressed in such Security (or, in the case of redemption, on or after the
Redemption Date).

ARTICLE NINE.

CONCERNING THE TRUSTEE.

     SECTION 9.01. With respect to the Holders of any series of Securities
issued hereunder, the Trustee, prior to the occurrence of an Event of Default
with respect to the Securities of that series and after the curing of all Events
of Default which may have occurred with respect to that series, undertakes to
perform such duties and only such duties as are specifically set forth in this
Indenture. In case an Event of Default with respect to the Securities of a
series has occurred (which has not been cured or waived) the Trustee shall
exercise such of the rights and powers vested in it by this Indenture with
respect to such series, and use the same degree of care and skill in their
exercise, as a prudent man exercise, as a prudent man would exercise or use
under the circumstances in the conduct of his own affairs.

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

     (a) prior to the occurrence of an Event of Default with respect to the
Securities of a

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series and after the curing of all Events of Default with respect to such series
which may have occurred:

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

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

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

     (c) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the
Holders of not less than a majority in principal amount of the Securities of any
series at the time Outstanding relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Indenture.

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

     SECTION 9.02. Subject to the provisions of Section 9.01:

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

     (b) any request, direction, order or demand of or notice by
the Company mentioned herein shall be sufficiently evidenced by an
instrument signed in the name of the Company by the Chairman of the
Board, the President or any Vice-President and by the Treasurer, any
Assistant Treasurer, the Secretary or any Assistant Secretary (unless
other evidence in respect thereof be herein specifically prescribed);
and any resolution of the Board of Directors of the Company may be
evidenced to the Trustee by a copy thereof certified by the Secretary
or an Assistant Secretary of the Company;

     (c) the Trustee may consult with counsel and any advice of
such counsel or

35

 

any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or omitted by it hereunder in
good faith and in accordance with such advice or Opinion of Counsel;

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

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

     (f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent,
order, bond, debenture, or other paper or document, unless requested in
writing so to do by the Holders of twenty-five per cent in aggregate
principal amount of the Securities of any series affected then
Outstanding; provided, however, that if the payment within a reasonable
time to the Trustee of the costs, expenses or liabilities likely to be
incurred by it in the making of such investigation is, in the opinion
of the Trustee, not reasonably assured to the Trustee by the security
conferred upon it by the terms of this Indenture, the Trustee may
require reasonable indemnity against such costs, expenses or
liabilities as a condition to so proceeding; the reasonable expense for
such investigation shall be paid by the Company or, if paid by the
Trustee, shall be repaid by the Company upon demand; and

     (g) the Trustee may execute any of the trusts or powers 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 by it with
due care hereunder.

     SECTION 9.03. The recitals contained herein and in the Securities
(other than the certificate of authentication on the Securities) shall be taken
as the statements of the Company and the Trustee or any Authenticating Agent
assumes no responsibility for the correctness of the same. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Securities. The Trustee or any Authenticating Agent shall not be accountable for
the use or application by the Company of any of the Securities or of the
proceeds of such Securities.

     SECTION 9.04. The Trustee, any Authenticating Agent, Paying Agent or
Security registrar, in its individual or any other capacity, may become the
owner or pledgee of Securities with the rights it would have if it were not
Trustee, Authenticating Agent, Paying Agent or Security registrar.

     SECTION 9.05. Subject to the provisions of Section 14.04 hereof, all
moneys received by the Trustee shall, until used or applied as herein provided,
be held in trust for the purposes for which they were received, but need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any moneys received by it hereunder
except such as it may agree with the Company to pay thereon. So long as no Event
of Default shall have occurred and be continuing, all interest allowed on any
such moneys shall be paid from time to tune upon the written order of the
Company.

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     SECTION 9.06. The Company covenants and agrees to pay to the Trustee
from time to time, and the Trustee shall be entitled to, reasonable compensation
(which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust), and the Company will pay or
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in connection with
any action taken by it under any of the provisions of this Indenture (including
the reasonable compensation and the expenses and disbursements of its counsel
and of all persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from its negligence or bad faith. The
Company also covenants to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or bad faith
on the part of the Trustee and arising out of or in connection with the
acceptance or administration of this trust, including the costs and expenses of
defending itself against any claim of liability in the premises. The obligations
of the Company under this Section 9.06 to compensate and indemnify and hold
harmless the Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional indebtedness hereunder
and shall survive the satisfaction and discharge of this Indenture. Such
additional indebtedness shall be secured by a lien prior to that of the
Securities upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the benefit of the Holders of particular
Securities.

     SECTION 9.07. Subject to the provisions of Section 9.01, whenever in
the administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
omitting any action hereunder, such matter (unless other evidence in respect
thereof be herein specifically prescribed) may, in the absence of negligence or
bad faith on the part of the Trustee, be deemed to be conclusively proved and
established by an Officers’ Certificate, delivered to the Trustee, which, in the
absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken or omitted by it under the
provisions of this Indenture upon the faith thereof.

     SECTION 9.08. (a) If the Trustee has or shall acquire any conflicting
interest, as defined in this Section 9.0 8 with respect to the Securities of any
series, it shall, within ninety days after ascertaining that it has such
conflicting interest, either eliminate such conflicting interest or resign with
respect to the Securities of that series in the manner and with the effect
specified in Section 9.10.

     (b) In the event that the Trustee shall fail to comply with
the provisions of subsection (a) of this Section 9.08 with respect to
the Securities of any series, the Trustee shall, within ten days after
the expiration of such ninety-day period, transmit notice by mail of
such failure to the Holders of Securities of that series, at the
addresses of such Holders as they appear upon the registry books of the
Company for such series.

     (c) For the purposes of this Section 9.08 the Trustee shall be
deemed to have a conflicting interest with respect to the Securities of
any series if

     (1) the Trustee is trustee under this Indenture with respect
to the Outstanding Securities of any series other than that series, or
is trustee under another indenture under which any other securities, or
certificates of interest or participation in any other securities, of
the Company are outstanding, unless such other indenture is a
collateral trust indenture under which the only collateral consists of
Securities issued under this Indenture, provided that there shall be
excluded from the operation of this paragraph (a) this Indenture with
respect to the Securities of any series other than that series and (b)
so

37

 

long as the Securities shall not have become secured pursuant to
Section 6.03 of this Indenture, in the indenture dated as of April 1,
1971 between the Company and Manufacturers Hanover Trust Company,
Trustee, under which the Company’s 7.70% Sinking Fund Debentures due
April 1, 1991 are outstanding (but only so long as such 7.70% Sinking
Fund Debentures due April 1, 1991 shall not have become secured
pursuant to Section 4.03 or Section 11.01 of the indenture under which
they were issued), the indenture dated as of December 1, 1981 between
the Company and Manufacturers Hanover Trust Company, Trustee, under
which the company’s 15% Sinking Fund Debentures due December 1, 1991
shall not have become secured pursuant to Section 4.03 or Section 11.01
of the indenture under which they were issued), the indenture dated as
of September 1, 1982 between the Company and Manufacturers Hanover
Trust Company, Trustee, under which the Company’s 11 3/8% Sinking Fund
Debentures due November 15, 1994 and the Company’s 10% Notes due
December 31, 1995 are outstanding (but only so long as such 11 3/8%
Sinking Fund Debentures due November 15, 1994 or such 10% Notes due
December 31, 1995 shall not have become secured pursuant to Section
6.03 or Section 13.01 of the indenture under which they were issued),
and the indenture dated as of September 15, 1981 between Bear Creek
Capital Corporation (an affiliate of the Company) and Manufacturers
Hanover Trust Company and T.C. Crane, Trustees, under which Bear Creek
Capital Corporation’s 9 7/8% Secured Noes, Series A due November 1,
2000 and 14 7/8% Secured Notes, Series B due November 1, 2000 are
outstanding and (c) any other indenture or indentures under which other
securities, or certificates of interest or participation in other
securities, of the Company are outstanding if *I) this Indenture and
such other indenture or indentures are wholly unsecured and such other
indenture or indentures are hereafter qualified under the Trust
Indenture Act of 1939, unless the Securities and Exchange commission
shall have found and declared by order pursuant to subsection (b) of
Section 305 or subsection (c) of Section 307 of the Trust Indenture Act
of 1939 that differences exist between the provisions of this Indenture
with respect to Securities of that series and one or more other series
or the provisions of such other indenture or indentures which are so
likely to involve a material conflict of interest as to make it
necessary in the public interest or for the protection of investors to
disqualify the Trustee from acting as such under this Indenture with
respect to the Securities of that series and such other series or under
one of such indentures, or (ii) the Company shall have sustained the
burden of proving. on application to the Securities and Exchange
Commission and after opportunity for hearing thereon, that the
trusteeship under this Indenture with respect to the Securities of that
series and such other series or such other indenture or indentures is
not so likely to involve a material conflict of interest as to make it
necessary in the public interest or for the protection of investors to
disqualify the Trustee from acting as such under this Indenture with
respect to the Securities of that series and such other series or under
one of such indentures;

     (2) the Trustee or any of its directors or executive officers
is an obligor upon the Securities of any series or an underwriter for
the Company;

     (3) the Trustee directly or indirectly controls or is directly
or indirectly controlled by or is under direct or indirect common
control with the Company or an underwriter for the Company;

     (4) the Trustee or any of its directors or executive officers
is a director, officer, partner, employee, appointee, or representative
of the Company, or of an underwriter (other than the Trustee itself)
for the Company who is currently engaged in the business

38

 

of underwriting, except that (A) one individual may be a director
and/or an executive officer of the Trustee and a director and/or an
executive officer of the Company, but may not be at the same time an
executive officer of both the Trustee and the Company; (B) if and so
long as the number of directors of the Trustee in office is more than
nine, one additional individual may be a director and/or an executive
officer of the Trustee and a director of the Company; and (C) the
Trustee may be designated by the Company or by an underwriter for the
Company to act in the capacity of transfer agent. Registrar, custodian,
paying agent, fiscal agent, escrow agent, or depositary, or in any
other similar capacity, on subject to the provisions of paragraph (I)
of this subsection (c), to act as trustee whether under an indenture or
otherwise;

     (5) ten per cent or more of the voting securities of the
Trustee is beneficially owned either by the Company or by any director,
partner or executive officer thereof, or twenty per cent or more of
such voting securities is beneficially owned, collectively, by any two
or more of such persons; or ten per cent or more of the voting
securities of the Trustee is beneficially owned either by an
underwriter for the Company or by any director, partner or executive
officer thereof, or is beneficially owned, collectively, by any two or
more such persons;

     (6) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, (A) five per
cent or more of the voting securities, or ten per cent or more of any
other class of security, of the Company, not including the Securities
issued under this Indenture and securities issued under any other
indenture under which the Trustee is also trustee, or (B) ten per cent
or more of any class of security of an underwriter for the Company;

     (7) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, five per
cent or more of the voting securities of any person who, to the
knowledge of the Trustee, owns ten per cent or more of the voting
securities of, or controls directly or indirectly or is under direct or
indirect common control with the Company;

     (8) the Trustee is the beneficial owner of, or holds as
collateral security for an obligation which is in default, ten per cent
or more of any class of security of any person who, to the knowledge of
the Trustee, owns fifty per cent or more of the voting securities of
the Company; or

     (9) the Trustee owns on May I5 in any calendar year, in the
capacity of executor, administrator, testamentary or inter vivos
trustee, guardian, committee or conservator, or in any other similar
capacity, an aggregate of twenty-five per cent or more of the voting
securities, or of any class of security, of any person, the beneficial
ownership of a specified percentage of which would have constituted a
conflicting interest under paragraph (6), (7), or (8) of this
subsection. As to any such securities of which the Trustee acquired
ownership through becoming executor, administrator, or testamentary
trustee of an estate which included them, the provisions of the
preceding sentence shall not apply, for a period of two years from the
date of such acquisition, to the extent that such securities included
in such estate do not exceed twenty-five per cent of such voting
securities or twenty-five per cent of any such class of security.
Promptly after May 15, in each calendar year, the Trustee shall make a
check of its holdings of such securities in any of the above-mentioned
capacities as of such May 15. If the Company fails to make payment in
full of principal of or interest on any of the Securities

39

 

when and as the same becomes due and payable and such failure continues
for thirty days thereafter the Trustee shall make a prompt check of its
holdings or such securities in any of the above-mentioned capacities as
of the date of the expiration of such thirty-day period, and after such
date, notwithstanding the foregoing provisions of this paragraph (9),
all such securities so held by the Trustee, with sole or joint control
over such securities vested in it, shall, but only so long as such
failure shall continue, be considered as though beneficially owned by
the Trustee for the purposes of paragraphs (6), (7), and (8) of this
subsection (C).

     The specification of percentages in paragraphs (5) to (9), inclusive,
of this subsection (c) shall not be construed as indicating that the ownership
of such percentages of the securities of a person is or is not necessary or
sufficient to constitute direct or indirect control for the purposes of
paragraph (3) or (7) of this subsection (c).

     For the purposes of paragraphs (6), (7), (8), and (9) of this
subsection (c) only, (A) the terms “security” and “securities” shall include
only such securities as are generally known as corporate securities, but shall
not include any note or other evidence of indebtedness issued to evidence an
obligation to repay moneys lent to a person by one or more banks, trust
companies or banking firms, or any certificate of interest or participation in
any such note or evidence of indebtedness; (B) an obligation shall be deemed to
be in default when a default in payment of principal shall have continued for
thirty days or more and shall not have been cured; and (C) the Trustee shall not
be deemed to be the owner or holder of (i) any security which it holds as
collateral security (as trustee or otherwise) for an obligation which is not in
default as defined in clause (B) above; or (ii) any security which it holds as
collateral security under this Indenture irrespective of any default hereunder,
or (iii) any security which it holds as agent for collection, or as custodian,
escrow agent, or depositary, or in any similar representative capacity.

     Except as above provided, the word “security” or “securities” as used
in this Indenture shall mean any note, stock. treasury stock, bond, debenture,
evidence of indebtedness, certificate of interest or participation in any
profit-sharing agreement, collateral trust certificate, pre-organization
certificate or subscription, transferable share, investment contract,
voting-trust certificate, certificate of deposit for a security, fractional
undivided interest in oil, gas, or other mineral rights, or, in general, any
interest or instrument commonly known as a “security”, or any certificate of
interest or participation in a temporary or interim certificate for, receipt
for, guarantee of, or warrant or right to subscribe to or purchase, any of the
foregoing.

     (d) For the purposes of this Section 9.08

     (1) The term “underwriter” when used with reference to the
Company shall mean every person, who, within three years prior, to the
time as of which the determination is made, has purchased from the
Company with a view to, or has offered or sold for the Company in
connection with, the distribution of any security of the Company
outstanding at such time, or has participated or has had a direct or
indirect participation in any such undertaking, or has participated or
has had a participation in the direct or indirect underwriting of any
such undertaking, but such term shall not include a person whose
interest was limited to a commission from tin underwriter or dealer not
in excess of the usual and customary distributors’ or sellers’
commission.

     (2) The term “director” shall mean any director of a
corporation or any individual performing similar functions with respect
to any organization whether incorporated or unincorporated.

40

 

     (3) The term “person” shall mean an individual, a corporation,
a partnership, an association, a joint-stock company, a trust, an
unincorporated organization, or a government or political subdivision
thereof. As used in this paragraph, the term “trust’ shall include only
a trust where the interest or interests of the beneficiary or
beneficiaries are evidenced by a security.

     (4) The term “voting security” shall mean any security
presently entitling the owner or holder thereof to vote in the
direction pr management of the affairs of a person, or any security
issued under or pursuant to any trust, agreement or arrangement whereby
a trustee or trustees or agent or agents for the owner or holder of
such security are presently entitled to vote in the direction or
management of the affairs of a person.

     (5) The term “Company” shall mean any obligor upon the
Securities.

     (6) The term “executive officer” shall mean the president,
every vice-president, every trust officer, the cashier, the secretary,
and the treasurer of a corporation and any individual customarily
performing similar functions with respect to any organization whether
incorporated or unincorporated, but shall not include the chairman of
the board of directors.

     The percentages of voting securities and other securities specified in
this Section 9.08 shall be calculated in accordance with the following
provisions:

     (A) A specified percentage of the voting securities of the Trustee the
Company or any other person referred to in this Section 9.08 (each of whom is
referred to as a “person” in this paragraph) means such amount of the
outstanding voting securities of such person as entities the holder or holders
thereof to cast such specified percentage of the aggregate votes which the
holders of all the outstanding voting securities of such person are entitled to
cast in the direction or management or the affairs of such person.

     (B) A specified percentage of a class of securities of a person means
such percentage of the aggregate amount of securities of the class outstanding.

     (C) The term “amount”, when used in regard to securities, means the
principal amount if relating to evidences of indebtedness, the number of shares
if relating to capital shares, and the number of units if relating to any other
kind of security.

     (D) The term “outstanding” means issued and not held by or for the
account of the issuer. The following securities shall not be deemed outstanding
within the meaning of this definition:

(i) securities of an issuer held in a sinking fund relating to
securities of the issuer of the same class;

(ii) securities of an issuer held in a sinking fund relating to another
class of securities of the issuer, if the obligation evidenced by such
other class of securities is not in default as to principal or interest
or otherwise;

(iii) securities pledged by the issuer thereof as security for an
obligation of the issuer not in default as to principal or interest or
otherwise; and

41

 

(iv) securities held in escrow if placed in escrow by the issuer
thereof;

     provided, however, that any voting securities of an issuer shall be
deemed outstanding if any person other than the issuer is entitled to exercise
the voting rights thereof.

     (E) A security shall be deemed to be of the same class as another
security if both securities confer upon the holder or holders thereof
substantially the same rights and privileges; provided, however, that, in the
case of secured evidences of indebtedness, all of which are issued under a
single indenture, differences in the interest rates or maturity dates of various
series thereof shall not be deemed sufficient to constitute such series
different classes; and provided, further, that, in the case of unsecured
evidences of indebtedness, differences in the interest rates or maturity dates
thereof shall not be deemed sufficient to constitute them securities of
different classes, whether or not they are issued under a single indenture.

     SECTION 9.09. The Trustee hereunder shall at all times be a corporation
organized and doing business under the laws of the United States or any State or
Territory thereof or of the District of Columbia, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least Twenty Million Dollars ($20,000,000), subject to supervision or
examination by Federal, State, Territorial, or District of Columbia authority
and having its principal office and place of business in The City of New York,
if there be such a corporation having its principal office and place of business
in said City willing and able to act as Trustee on reasonable and customary
terms. If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purposes of this Section 9.09, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 9.09, the Trustee shall resign immediately in the
manner and with the effect specified in Section 9.10.

     SECTION 9.10. (a) The Trustee, or any trustee or trustees hereafter appointed,
may at any time resign with respect to one or more or all series of Securities
by giving written notice of such resignation to the Company and by mailing
notice thereof to the Holders of Securities of such series at their addresses as
they shall appear on the registry books of the Company for such series. Upon
receiving such notice of resignation, the Company shall promptly appoint a
successor trustee with respect to the Securities of such series by written
instrument, in duplicate, executed by order of the Board of Directors of the
Company, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor trustee. If no successor trustee with
respect to the Securities of such series shall have been so appointed and have
accepted appointment within thirty days after the mailing of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee, or any Holder who has
been a bona tide Holder of a Security or Securities of such series for at least
six months may, subject to the provisions of Section 8.08, on behalf of himself
and all others similarly situated, petition any such court for the appointment
of a successor trustee. Such court may thereupon, after such notice, if any, as
it may deem proper and prescribe, appoint a successor trustee.

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

(1) the Trustee shall fail to comply with the provisions of subsection
(a) of Section 9.08 after written request therefor by the Company or
any Holder who has been a bona tide

42

 

Holder of a Security or Securities for at least six months, or

(2) the Trustee shall cease to be eligible in accordance with the
provisions of Section 9.09 and shall fail to resign after written
request therefor by the Company or by any such Holder, or

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

     then, in any such case, the Company may remove the Trustee with respect
to all Securities and appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors of the Company, one copy
of which instrument shall be delivered to the Trustee so removed and one copy to
the successor trustee, or, subject to the provisions of Section 8.08, any Holder
who has been a bona fide Holder of a Security or Securities for at least six
months may, on behalf of himself and all others similarly situated, petition any
court of competent jurisdiction for the removal of the Trustee with respect to
all Securities and the appointment of a successor trustee. Such court may
thereupon alter such notice. if any, as it may deem proper and prescribe, remove
the Trustee and appoint a successor trustee.

     (c) The Holders of a majority in aggregate principal amount of the
Securities of any series at the time Outstanding may at any time remove the
Trustee with respect to such series and appoint a successor trustee with respect
to such series by the delivery to the Trustee so removed, to the successor
trustee and to the Company of the evidence provided for in Section 10.01 of the
action in that regard taken by the Holders.

     (d) Any resignation or removal of the Trustee and any appointment of a
successor trustee pursuant to any of the provisions of this Article Nine shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 9.11.

     SECTION 9.11. (a) Any successor trustee appointed as provided in
Section 9.10 with respect to the Securities of all series shall execute,
acknowledge and deliver to the Company and to its predecessor trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor trustee shall become effective and such successor
trustee, without any further act. deed or conveyance, shall become vested with
all the rights, powers, duties and obligations of its predecessor hereunder,
with like effect as if originally named as Trustee herein; but, nevertheless, on
the written request of the Company or the successor trustee, the trustee ceasing
to act shall, upon payment of any amounts then due it pursuant to the provisions
of Section 9.06, execute and deliver an instrument transferring to such
successor trustee all the rights and powers of the trustee so ceasing to act.

     (b) In case of the appointment hereunder of a successor trustee with
respect to the Securities of one or more (but not all) series, the Company, the
predecessor trustee and each successor trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary desirable to transfer and confirm
to, and to vest in. each successor trustee all the rights, powers, trusts and
duties of the predecessor trustee with respect to the Securities of that or
those series to which the appointment of such successor trustee relates, (2) if
the predecessor trustee is not retiring with respect to the Securities of all
series for which it is the trustee hereunder, shall contain such provisions as
shall be deemed

43

 

necessary or desirable to confirm that all the rights, powers, trusts and duties
of the predecessor trustee with respect to the Securities of that or those
series as to which the predecessor trustee is not retiring shall continue to be
vested in the predecessor trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such trustees co-trustees of the same trust and that each such
trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such trustee; and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the predecessor trustee shall become effective to the extent provided
therein and each such successor trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the predecessor trustee with respect to the Securities of that or those
series to which the appointment of such successor trustee relates: but, on the
request of the Company or any successor trustee, such predecessor trustee shall
duly assign, transfer and deliver to such successor trustee all property and
money held by such predecessor trustee hereunder with respect to the Securities
of that or those series to which the appointment of such successor trustee
relates.

     (c) Upon request of any such successor trustee, the Company shall
execute any and all instruments in writing for more fully and certainly vesting
in and confirming to such successor trustee all such rights, powers and trusts
referred to in subsection (a) or (b) of this Section 9.11, as the case may be.
Any trustee ceasing to act shall, nevertheless retain the lien, if any, provided
for in Section 9.06 upon all property or funds held or collected by such
trustee.

     No successor trustee shall accept appointment as provided in this
Section 9.11 unless at the time of such acceptance such successor trustee shall
be qualified under the provisions of Section 9.08 and eligible under the
provisions of Section 9.09.

     Upon acceptance of appointment by a successor trustee as provided in
this Section 9.11, the Company shall mail notice of the succession of such
trustee hereunder to the Holders of the Securities of any applicable series at
their addresses as they shall appear on the registry books of the Company for
such series. If the Company fails so to mail such notice within ten days after
acceptance of appointment by the successor trustee, the successor trustee shall
cause such notice to be so mailed at the expense of the Company.

     SECTION 9.12. Any corporation into which the Trustee may be merged or
convened or with which it may be consolidated or any corporation resulting from
any merger, conversion or consolidation to which the Trustee shall be a party,
or any corporation succeeding to the corporate trust business of the Trustee,
shall be the successor of the Trustee hereunder without the execution or filing
of any paper or any further act on the pan of any of the parties hereto. In any
such case such successor, unless it is the same corporation, shall forthwith
make a report to Holders of the character required by paragraph (1) of
subsection (a) of Section 7.04, in the manner provided in said Section 7.04.

     In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Securities of any series with
respect to which the appointment of such successor trustee relates shall have
been authenticated but not delivered, any such successor to the Trustee may
adopt the certificate of authentication of any predecessor Trustee, and deliver
such Securities so authenticated; and in case at that time any of the Securities
of any series with respect to which the appointment of such successor trustee
relates shall not have been authenticated, such successor to the Trustee may
authenticate such Securities either in the name of any predecessor hereunder or
in the name of such successor to the Trustee; and in all such cases such
certificates

44

 

shall have the full force which it is anywhere in the Securities of such series
or in this Indenture provided that the certificate of the Trustee shall have;
provided, however, that the right to adopt the certificate of authentication of
any predecessor Trustee or authenticate Securities of any series in the name of
any predecessor Trustee shall apply only to its successor or successors by
merger, conversion or consolidation.

     SECTION 9.13. (a) Subject to the provisions of subsection (b) of this
Section 9.13, if the Trustee shall be or shall become a creditor, directly or
indirectly, secured or unsecured, of the Company or any other obligation on the
Securities within four months prior to a default, as defined in subsection (c)
of this Section 9.13, or subsequent to such default, then, unless and until such
default shall be cured, the Trustee shall set apart and hold in a special
account for the benefit of the Trustee individually, the Holders or the
Securities and the holders of other indenture securities (as defined in
subsection (c) of this Section 9.13).

     (1) an amount equal to any and all reductions in the amount due and
owing upon any claim of the Trustee as such creditor in respect of principal or
interest, effected after the beginning of such four months’ period and valid as
against the Company and its other creditors, except any such reduction resulting
from the receipt or disposition of any property described in paragraph (2) of
this subsection (a), or from the exercise of any right of set-off which the
Trustee could have exercised if a petition in bankruptcy had been filed by or
against the Company upon the date of such default; and

     (2) all property received by the Trustee in respect of any claim as
such creditor, either as security therefor, or in satisfaction or composition
thereof, or otherwise, after the beginning of such four months’ period, or an
amount equal to the proceeds of any such property, if disposed of; subject,
however, to the rights, if any, of the Company and its other creditors in such
property or such proceeds.

     Nothing herein contained, however, shall affect the right of the
Trustee

     (A) to retain for its own account (i) payments made on account of any
such claim by any person (other than the Company) who is liable thereon, and
(ii) the proceeds of the bona fide sale of any such claim by the Trustee to a
third person, and (iii) distributions made in cash. securities, or other
property in respect of claims filed against the Company in bankruptcy or
receivership or in proceedings for reorganization pursuant to the Federal
bankruptcy laws or applicable State law;

     (B) to realize, for its own account, upon any property held by it as
security for any such claim, if such property was so held prior to the beginning
of such four months’ period;

     (C) to realize, for its own account. but only to the extent of the
claim hereinafter mentioned, upon any property held by it as security for any
such claim, if such claim was created after the beginning of such four months’
period and such property was received as security therefor simultaneously with
the creation thereof, and if the Trustee shall sustain the burden of proving
that at the time such property was so received the Trustee had no reasonable
cause to believe that a default, as defined in subsection (c) of this Section
9.13, would occur within four months; or

     (D) to receive payment on any claim referred to in paragraph (B) or
(C), against the release of any property held as security for such claim as
provided in such paragraph (B) or (C),

45

 

as the case may be, to the extent of the fair value of such property.

     For the purposes of paragraphs (B), (C) and (D), property substituted
after the beginning of such four months’ period for property held as security at
the time of such substitution shall, to the extent of the fair value of the
property released. have the same status as the property released, and, to the
extent that any claim referred to in any of such paragraphs is created in
renewal of or in substitution for or for the purpose of repaying or refunding
any preexisting claim of the Trustee as such creditor, such claim shall have the
same status as such preexisting claim.

     If the Trustee shall be required to account, the funds and property
held in such special account and the proceeds thereof shall be apportioned
between the Trustee, the Holders and the holders of other indenture securities
in such manner that the Trustee, the Holders and the holders of other indenture
securities realize, as a result of payments from such special account and
payments of dividends on claims filed against the Company in bankruptcy or
receivership or in proceedings for reorganization pursuant to the Federal
bankruptcy laws or applicable State law, the same percentage of their respective
claims, figured before crediting to the claim of the Trustee anything on account
of the receipt by it from the Company of the funds and property in such special
account and before crediting to the respective claims of the Trustee, the
Holders and the holders of other indenture securities dividends on claims filed
against the Company in bankruptcy or receivership or in proceedings for
reorganization pursuant to the Federal bankruptcy laws or applicable State law,
but after crediting thereon receipts on account of the indebtedness represented
by their respective claims from all sources other than from such dividends and
from the funds and property so held in such special account As used in this
paragraph with respect to any claim, the term “dividends” shall include any
distribution with respect to such claim, in bankruptcy or receivership or in
proceedings for reorganization pursuant to the Federal bankruptcy laws or
applicable State law, whether such distribution is made in cash, securities, or
other property, but shall not include any such distribution with respect to the
secured portion, if any, of such claim. The court in which such bankruptcy,
receivership, or proceeding for reorganization is pending shall have
jurisdiction (i) to apportion between the Trustee, the Holders, and the holders
of other indenture securities in accordance with the provisions of this
paragraph, the funds and property held in such special account and the proceeds
thereof, or (ii) in lieu of such apportionment, in whole or in part, to give to
the provisions of this paragraph due consideration in determining the fairness
of the distributions to be made to the Trustee, the Holders and the holders of
other indenture securities with respect to their respective claims; in which
event it shall not be necessary to liquidate or to appraise the value of any
securities or other property held in such special account or as security for any
such claim, or to make a specific allocation of such distributions as between
the secured and unsecured portions of such claims, or otherwise to apply the
provisions of this paragraph as a mathematical formula.
Any Trustee who has resigned or been removed after the beginning of such four
months’ period shall be subject to the provisions of this subsection (a) as
though such resignation or removal had not occurred. If any Trustee has resigned
or been removed prior to the beginning of such four months’ period, it shall be
subject to the provisions of this subsection (a) if and only if the following
conditions exist:

(i) the receipt of property or reduction of claim which would have
given rise to the obligation to account, if such Trustee had continued
as Trustee, occurred after the beginning of such four months’ period;
and

(ii) such receipt of property or reduction of claim occurred within
four months after such resignation or removal.

46

 

     (b) There shall be excluded from the operation of subsection (a) of
this Section 9.13 a creditor relationship arising from

     (1) the ownership or acquisition of securities issued under any
indenture, or any security or securities having a maturity of one year or more
at the time of acquisition by the Trustee;

     (2) advances authorized by a receivership or bankruptcy court of
competent jurisdiction, or by this Indenture, for the purpose of preserving any
property which shall at any time be subject to the lien of this Indenture or of
discharging tax liens or other prior liens or encumbrances thereon, if notice of
such advance and of the circumstances surrounding the making thereof is given to
the Holders at the time and in the manner provided in Section 7.04;

     (3) disbursements made in the ordinary course of business in the
capacity of trustee under an indenture, transfer agent, registrar, custodian,
paying agent, fiscal agent or depositary, or other similar capacity;

     (4) an indebtedness created as a result of services rendered or
premises rented; or an indebtedness created as a result of goods or securities
sold in a cash transaction as defined in subsection (c) of this Section 9.13;

     (5) the ownership of stock or of other securities of a corporation
organized under the provisions of Section 25( a) of the Federal Reserve Act, as
amended, which is directly or indirectly a creditor of the Company; or

     (6) the acquisition, ownership, acceptance or negotiation of any
drafts, bills of exchange, acceptances or obligations which fall within the
classification of self-liquidating paper as defined in subsection (c) of this
Section 9.13.

(c) As used in this Section 9.13:

     (1) The term “default” shall mean any failure to make payment in full
of the principal of or interest upon any of the Securities or upon the other
indenture securities when and as such principal or interest becomes due and
payable;

     (2) The term “other indenture securities” shall mean securities upon
which the Company is an obligor (as defined in the Trust Indenture Act of 1939)
outstanding under any other indenture (A) under which the Trustee is also
trustee, (B) which contains provisions substantially similar to the provisions
of this Section 9.13; and (C) under which a default exists at the time of the
apportionment of the funds and property held in said special account;

     (3) The term “cash transaction” shall mean any transaction in which
full payment for goods or securities sold is made within seven days after
delivery of the goods or securities in currency or in checks or other orders
drawn upon banks or bankers and payable upon demand;

     (4) The term “self-liquidating paper” shall mean any draft, bill of
exchange, acceptance or obligation which is made, drawn, negotiated or incurred
by the Company for the purpose of financing the purchase, processing,
manufacture, shipment, storage or sale of goods, wares or merchandise and which
is secured by documents evidencing title to, possession of or a lien upon, the
goods, wares or merchandise or the receivables or proceeds arising from the sale
of the goods, wares or merchandise previously constituting the security,
provided the security is received by the Trustee simultaneously with the
creation of the creditor relationship with the Company arising

47

 

from the making, drawing, negotiating or incurring of the draft, bill of
exchange, acceptance or obligation; and

     (5) The term “Company” shall mean any obligor upon the Securities.

     SECTION 9.14. At any time when any of the Securities remain Outstanding
the Trustee may appoint an Authenticating Agent or Agents with respect to one or
more series of Securities which shall be authorized to act on behalf of the
Trustee to authenticate Securities of such series issued upon exchange,
registration of transfer or partial redemption thereof or pursuant to Section
3.07, and Securities so authenticated shall be entitled to the benefits of this
Indenture and shall be valid and obligatory for all purposes as if authenticated
by the Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the Trustee’s
certificate of authentication such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be a corporation organized and doing business
under the laws of the United States of America, any State thereof or the
District of Columbia, authorized under such laws to act as Authenticating Agent,
having a combined capital and surplus of not less than $20,000,000 and subject
to supervision or examination by Federal or State authority. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus
asset forth in its most recent report of condition so published. If at any time
an Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.

     Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.

     An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders of
Securities of the series with respect to which such Authenticating Agent will
serve, as their names and addresses appear in the register for such Securities.
Any successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.

     The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be

48

 

reimbursed for such payments pursuant to the provisions of Section 9.06.

     If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee’s certificate of authentication, an alternate
certificate of authentication in the following form:

     If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee’s certificate of authentication, an alternate
certificate of authentication in the following form:

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

	 	 	 	 	 	 	 
	 	 	MANUFACTURERS HANOVER TRUST COMPANY
	 	 
	 	 	 	 	As
Trustee
	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 

As Authenticating Agent
	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 

Authorized Officer
	 	 

ARTICLE TEN.

CONCERNING THE HOLDERS.

     SECTION 10.01. Whenever in this Indenture it is provided that the
Holders of a specified percentage or a majority in aggregate principal amount of
the Securities of any series may take any action (including the making of any
demand or request, the giving of any direction, notice, consent or waiver or the
taking of any other action) the fact that at the time of taking any such action
the Holders of such specified percentage or majority have joined therein may be
evidenced (a) by any instrument or any number of instruments of similar tenor
executed by such Holders in person or by agent or proxy appointed in writing, or
(b) by the record of such Holders voting in favor thereof at any meeting of such
Holders duly called and held in accordance with the provisions of Article
Eleven, or (c) by a combination of such instrument or instruments and any such
record of such a meeting of such Holders.

     SECTION 10.02. Subject to the provisions of Sections 9.01, 9.02 and
11.05, proof of the execution of any instrument by a Holder or his agent or
proxy and proof of the holding by any person of any of the Securities shall be
sufficient if made in the following manner:

     (a) The fact and date of the execution by any such person of any
instrument may be proved by the certificate of any notary public or other
officer authorized to take acknowledgments of deeds to be recorded in the
jurisdiction in which he acts, that the person executing such instrument
acknowledged to him the execution thereof, or by an affidavit of a witness to
such execution sworn to before any such notary or other such officer. The fact
and date of the execution of any such instrument may also be proved in any other
reasonable manner which the Trustee may deem sufficient. Such certificate or
affidavit shall also constitute sufficient proof of the authority of the person
executing any instrument in cases where Securities are not held by individuals.

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     (b) The holding of Securities shall be proved by the registry books of
the Company or by a certificate of the registrar thereof.

     The Trustee may require such additional proof of any matter referred to
in this Section 10.02 as it shall deem necessary.

     The record of any Holders’ meeting shall be proved in the manner
provided in Section 11.06.

     SECTION 10.03. Prior to due presentment for registration of transfer of
any Security the Company, the Trustee, any Paying Agent and any Security
registrar may deem and treat the person in whose name any Security shall be
registered upon the registry books of the Company as the absolute owner of such
Security (whether or not such Security shall be overdue and notwithstanding any
notation of ownership or other writing thereon made by anyone other than the
Company or any Security registrar) for the purpose of receiving payment of or on
account of the principal of and premium, if any, and, subject to Section 3.08,
interest on such Security and for all other purposes; and neither the Company
nor the Trustee nor any Paying Agent nor any Security registrar shall be
affected by any notice to the contrary. All such payments so made to any such
registered Holder for the time being, or upon his order, shall be valid, and. to
the extent of the sum or sums so paid, effectual to satisfy and discharge the
liability for moneys payable upon any such Security.

     SECTION 10.04. In determining whether the Holders of the requisite
aggregate principal amount of Securities of any series have concurred in any
demand, direction, request, notice, consent, waiver or other action under this
Indenture, Securities which are owned by the Company or any other obligor on the
Securities or by any person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company or any other obligor
on the Securities shall be disregarded and deemed not to be Outstanding for the
purpose of any such determination, provided that for the purpose of determining
whether the Trustee shall be protected in relying on any such demand, direction,
request, notice, consent, waiver or other action, only Securities which the
Trustee knows are so owned shall be disregarded. Securities so owned which have
been pledged in good faith may be regarded as Outstanding for the purposes of
this Section 10.04, if the pledgee shall establish to the satisfaction of the
Trustee the pledgee’s right to vote such Securities and that the pledgee is not
the Company nor any other obligor on the Securities or a person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company or any such other obligor. In case of a dispute as to
such right, any decision by the Trustee taken upon and in accordance with the
advice of counsel shall be full protection to the Trustee.

     SECTION 10.05. At any time prior to (but not after) the evidencing to
the Trustee, as provided in Section 10.01, of the taking of any action by the
Holders of a majority or the percentage in aggregate principal amount of the
Securities of a series specified in this Indenture in connection with such
action, any Holder of a Security which is shown by the evidence to be included
in the Securities the Holders of which have consented to such action may, by
filing written notice with the Trustee at its Principal Office and upon proof of
holding as provided in Section 10.02, revoke such action so far as concerns such
Security. Except as aforesaid any such action taken by the Holder of any
Security shall be conclusive and binding upon such Holder and upon all future
Holders and owners of such Security and of any Security issued in exchange
therefor or in lieu thereof, irrespective of whether or not any notation in
regard thereto is made upon such Security. Any action taken by the Holders of a
majority or the percentage in aggregate principal amount of the Securities of a
series specified in this Indenture in connection with such

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action shall be conclusively binding upon the Holders of all the Securities of
such series.

ARTICLE ELEVEN.

HOLDERS’ MEETINGS.

     SECTION 11.01 A meeting of Holders of Securities of any series may be
called at any time and from time to time pursuant to the provisions of this
Article Eleven for any of the following purposes:

     (1) to give any notice to the Company or to the Trustee, or to give any
directions to the Trustee, or to consent to the waiving of any default hereunder
and its consequences, or to take any other action authorized to be taken by
Holders pursuant to any of the provisions of Article Eight:

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

     (3) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 12.02: or

     (4) to take any other action authorized to be taken by or on behalf of
the Holders of a majority or any specified aggregate principal amount of the
Securities of such series under any other provisions of this Indenture or under
applicable law.

     SECTION 11.02. The Trustee may at any time call a meeting of Holders of
Securities of any series to take any action specified in Section 11.01 to be
held at such time and at such place in the Borough of Manhattan, The City of New
York, as the Trustee shall determine. Notice of every meeting of the Holders of
Securities of any series, setting forth the time and the place of such meeting
and in general terms the action proposed to be taken at such meeting, shall be
mailed to the Holders of such Securities at their addresses as they shall appear
on the registry books of the Company for such series. Such notice shall be
mailed not less than twenty nor more than one hundred and eighty days prior to
the date fixed for the meeting.

SECTION 11.03. In case at any time the Company, pursuant to a resolution of its
Board of Directors, or the Holders of at least ten per cent in aggregate
principal amount of the Securities of any series then Outstanding shall have
requested the Trustee to call a meeting of Holders of such series by written
request setting forth in reasonable detail the action proposed to be taken at
the meeting, and the Trustee shall not have mailed such notice within twenty
days after receipt of such request, then the Company or such Holders of
Securities in the amount above specified may determine the time and the place in
said Borough of Manhattan for such meeting and may call such meeting to take any
action authorized in Section 11.01. by giving notice thereof as provided in
Section 11.02.

     SECTION 11.04. To be entitled to vote at any meeting or Holders a
person shall be (a) a Holder of one or more Securities with respect to which
such meeting is being held or (b) a person appointed by an instrument in writing
as proxy for such a Holder. The only persons who shall be entitled to be present
or to speak at any meeting of Holders shall be the persons entitled to vote at
such meeting and their counsel and any representatives of the Trustee and its
counsel and any representatives of the Company and its counsel.

     SECTION 11.05. Notwithstanding any other provisions of this Indenture,
the Trustee

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may make such reasonable regulations as it may deem advisable for any meeting of
Holders, in regard to proof of the holding of Securities and of the appointment
of proxies, and in regard to the appointment and duties of inspectors of votes,
the submission and examination of proxies, certificates and other evidence of
the right to vote, and such other matters concerning the conduct of the meeting
as it shall think fit. Except as otherwise permitted or required by any such
regulations, the holding of Securities shall be proved in the manner specified
in Section 10.02 and the appointment of any proxy shall be proved in the manner
specified in said Section 10.02 or by having the signature of the person
executing the proxy witnessed or guaranteed by any trust company, bank or
bankers or member firm of the New York Stock Exchange satisfactory to the
Trustee.

     The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Holders as provided in Section 11.03, in which case the Company or
the Holders calling the meeting, as the case may be, shall in like manner
appoint a temporary chairman. A permanent chairman and a permanent secretary of
the meeting shall be elected by a majority vote of the meeting, irrespective of
the principal amount of their respective holdings.

     Subject to the provisions of Section 10.04, at any meeting each Holder
of Securities with respect to which such meeting is being held or proxy therefor
shall be entitled to one vote for each $1,000 (or such other amount as may be
established pursuant to Section 3.01 as the minimum authorized denomination for
Securities of such series) principal amount (in the case of Original Issue
Discount Securities, such principal amount to be determined as provided in the
definition of “Outstanding”) of Securities held by him or represented by him at
the meeting; provided, however, that no vote shall be cast or counted at any
meeting in respect of any Security challenged as not Outstanding and ruled by
the chairman of the meeting to be not Outstanding. The chairman of the meeting
shall have no right to vote other than by virtue of Securities held by him or
instruments in writing as aforesaid duly designating him as the person to vote
on behalf of other such Holders. Any meeting of Holders duly called pursuant to
the provisions of Section 11.02 or 11.03 may be adjourned from time to time, and
the meeting may be held as so adjourned without further notice.

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

     SECTION 11.06. The vote upon any resolution submitted to any meeting of
Holders of Securities with respect to which such meeting is being held shall be
by written ballots on which shall be subscribed the signatures of such Holders
or of their representatives by proxy and the serial number or numbers of the
Securities held or represented by them. The permanent chairman of the meeting
shall appoint two inspectors of votes who shall count all votes cast at the
meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in duplicate of all
votes cast at the meeting. A record in duplicate of the proceedings of each
meeting of Holders shall be prepared by the secretary of the meeting and there
shall be attached to said record the original reports of the inspectors of votes
on any vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was mailed as provided in Section 11.02; provided,
however, that in case at any such meeting the Holders shall have voted

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to remove the Trustee and to appoint a successor pursuant to the provisions of
Section 9.10(c), the record of the proceedings of such meeting shall be prepared
in triplicate. The record shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one copy of the record shall
be delivered to the Company and another copy thereof to the Trustee (to be
preserved by the Trustee); and if at such meeting a successor trustee shall have
been appointed by vote of the Holders, a third copy of the record shall be
delivered to such successor trustee.

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

     SECTION 11.07. Nothing in this Article Eleven contained shall be deemed
or construed to authorize or permit, by reason of any call of a meeting of
Holders or any rights expressly or impliedly conferred hereunder to make such
call, any hindrance or delay in the exercise of any right or rights conferred
upon or reserved to the Trustee or to the Holders under any of the provisions of
this Indenture or of the Securities.

ARTICLE TWELVE.

SUPPLEMENTAL INDENTURES.

     SECTION 12.01. In addition to such indenture or indentures supplemental
hereto for which provision is made elsewhere in this Indenture, the Company,
when authorized by a resolution of its Board of Directors, and the Trustee may
from time to time and at any time enter into an indenture or indentures
supplemental hereto for one or more of the following purposes:

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

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

     (c) to add to or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of Securities
in bearer form, registrable or not registrable as to principal, and with or
without interest coupons;

     (d) to change or eliminate any of the provisions of this Indenture,
provided that any change or elimination shall become effective only when there
is no Security Outstanding of any series created prior to the execution of such
supplemental indenture which is entitled to the

53

 

benefit of such provisions;

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

     (f) to secure the Securities of any series pursuant to the requirements
of Section 6.04 or otherwise;

     (g) to establish the form or terms of Securities of any series as
permitted by Sections 2.01 and 3.01;

     (h) to modify, amend or supplement this Indenture in such a manner as
to permit the qualification of any indenture supplemental hereto under the Trust
Indenture Act of 1939 as then in effect except that nothing herein contained
shall permit or authorize the inclusion in any indenture supplemental hereto of
the provisions referred to in Section 316(a)(2) of such Act; and

     (i) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective or
inconsistent with any other provision contained herein or in any supplemental
indenture, or to make such other provisions in regard to matters or questions
arising under this Indenture which shall not be inconsistent with the provisions
of this Indenture and which shall not adversely affect in any material respect
the interests of any Holders of the Securities.

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

     Any supplemental indenture authorized by the provisions of this Section
12.01 may be executed by the Company and the Trustee without the consent of the
Holders of any of the Securities at the time Outstanding, notwithstanding any of
the provisions of Section 12.02.

     SECTION 12.02. With the consent (evidenced as provided in Section
10.01) of the Holders of not less than a majority in aggregate principal amount
of the Outstanding Securities of each series affected by such supplemental
indenture, the Company, when authorized by a resolution of its Board of
Directors, and the Trustee may from time to time and at any time enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Indenture or of any supplemental indenture or modifying in any manner the
rights of the Holders of the Securities of each such series; provided, however,
that no such supplemental indenture shall (i) change the stated maturity date of
any Security, or reduce the rate or change the time of payment of interest
thereon, or reduce the principal amount thereof or any premium thereon, or make
the principal thereof or interest or premium thereon payable in any coin or
currency other than that provided in the Securities, or reduce the amount of the
principal of an Original Issue Discount Security that would be due and payable
upon an acceleration of the maturity thereof pursuant to Section 8.01 or the
amount thereof provable in bankruptcy pursuant to Section 8.02, without the
consent of the Holder of such Security, or (ii) reduce the aforesaid percentage
of Securities, the Holders of

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which are required to consent to any such supplemental indenture, without the
consent of the Holders of all Securities affected thereby then Outstanding. A
supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has been included solely for the benefit of
one or more particular series of Securities, or which modifies the rights of
Holders of Securities of such series with respect to such covenant or other
provision, shall be deemed not to affect the rights under this Indenture of the
Holders of Securities of any other series.

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

     It shall not be necessary for the consent of the Holders under this
Section 12.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.

     Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section 12.02, the
Company shall mail a notice, setting forth in general terms the substance of
such supplemental indenture, to the Holders of each Security of each series
affected thereby at their addresses as they shall appear on the registry books
of the Company. Any failure of the Company so to give such notice, or any defect
therein, shall not, however, in any way impair or affect the validity of any
such supplemental indenture.

     SECTION 12.03. Upon the execution of any supplemental indenture pursuant
to the provisions of this Article Twelve this Indenture shall be and be deemed
to be modified and amended in accordance therewith and the respective rights,
limitations of rights, obligations, duties and immunities under this Indenture
of the Trustee, the Company and the Holders shall thereafter be determined,
exercised and enforced hereunder subject in all respects to such modifications
and amendments, and all the terms and conditions of any such supplemental
indenture shall be and be deemed to be part of the terms and conditions of this
Indenture for any and all purposes.

     SECTION 12.04. Securities authenticated and delivered after the
execution of any supplemental indenture pursuant to the provisions of this
Article Twelve may bear a notation in form approved by the Trustee as to any
matter provided for in such supplemental indenture. If the Company or the
Trustee shall so determine, new Securities of any series so modified as to
conform, in the opinion of the Trustee and the Board of Directors of the
Company, to any modification of this Indenture contained in any such
supplemental indenture may be prepared by the Company, authenticated by the
Trustee and delivered in exchange for the Securities of such series then
Outstanding without charge to the Holders thereof. The Company or the Trustee
may require the Outstanding Securities of such series to be presented for
notation or exchange as aforesaid, if either of them shall see fit to do so.

     SECTION 12.05. Any indenture supplemental hereto entered into pursuant
to any provision of this Indenture shall conform with the Trust Indenture Act of
1939 as then in effect.

     SECTION 12.06. Subject to the provisions of Section 9.01, the Trustee
may receive an

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Opinion of Counsel as conclusive evidence that any supplemental indenture
executed pursuant to the provisions of this Indenture complies with the
requirements of this Indenture.

ARTICLE THIRTEEN.

CONSOLIDATION, MERGER AND SALE.

SECTION 13.01. Nothing contained in this Indenture or the Securities shall
prevent any consolidation or merger of the Company with or into any corporation
or corporations (including any Subsidiary), or any consolidation or merger of
any other corporation (including any Subsidiary) with or into the Company, or
successive consolidations or mergers in which the Company or its successor or
successors shall be a party or parties or shall prevent any sale or conveyance
of the properties and assets of the Company as an entirety or substantially as
an entirety to any other person (including, any Subsidiary), or the acquisition
by the Company by purchase or otherwise of all or any part of the properties and
assets of any other person (including any Subsidiary), provided that in the case
of any consolidation of the Company with, or merger of the Company into, any
corporation or corporations. or any sale or conveyance of the properties and
assets of the Company as an entirety or substantially as an entirety:

     (1) the corporation formed by such consolidation or into which the
Company is merged or the person which acquires by conveyance or transfer the
properties and assets of the Company as an entirety or substantially as an
entirety shall expressly assume, by an indenture supplemental hereto, executed
and delivered to the Trustee, in form satisfactory to the Trustee, the
performance of the Securities and every covenant of this Indenture on the part
of the Company to be performed or observed;

     (2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time or both would become
an Event of Default, shall have happened and be continuing: and

     (3) the Company shall have delivered to the Trustee an Officers
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger, sale or conveyance and such supplemental indenture comply with this
Article and that all conditions precedent herein provided for relating to such
transaction have been complied with.

     SECTION 13.02. Upon any consolidation or merger, or any conveyance or
transfer of the properties and assets of the Company as an entirety or
substantially as an entirety, in accordance with the proviso in Section 13.01,
the successor corporation formed by such consolidation or into which the Company
is merged or the person to which such conveyance or transfer is made 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 successor
corporation or person had been named as the Company, and thereafter, the
predecessor shall be relieved of all obligations and covenants under this
Indenture or the Securities, as the case may be.

ARTICLE FOURTEEN.

SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS.

     SECTION 14.01. This Indenture shall, upon written order of the Company
signed by the Chairman of the Board, the President or any Vice President and by
the Treasurer or any Assistant

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Treasurer of the Company, cease to be of further effect (except as to any
surviving rights of registration of transfer or. exchange of Securities herein
expressly provided for), and the Trustee, at the expense of the Company, shall
execute proper instruments acknowledging satisfaction and discharge of this
Indenture, when

     (1) either

(A) all Securities theretofore authenticated and delivered (other than
(i) Securities which have been destroyed lost or stolen and which have
been replaced or paid as provided in Section 3.07 and (ii) Securities
for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter repaid to
the Company or discharged from such trust, as provided in Section
6.06(d)) have been delivered to the Trustee for cancellation; or

(B) all such Securities not theretofore delivered to the Trustee for
cancellation

     (i) have become due and payable, or

     (ii) will become due and payable at their stated maturity
within one year, or

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

and the Company, in the case of (i), (ii) or (iii) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the purpose
an amount sufficient to pay and discharge the entire indebtedness on such
Securities not theretofore delivered to the Trustee for cancellation, for
principal (and premium, if any) and interest to the date of such deposit (in the
case of Securities which have become due and payable) or to the stated maturity
or Redemption Date, as the case may be;

     (2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and

     (3) the Company has delivered to the Trustee an Officers’ Certificate
and an Opinion of Counsel each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.

     Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 9.06, the obligations of
the Trustee to any Authenticating Agent under Section 9.14 and if money shall
have been deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the obligations of the Trustee under Sections 14.02 and 14.04
shall survive.

     SECTION 14.02. Subject to the provisions of Section 14.04, all money
deposited with the Trustee pursuant to Section 14.01 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the persons entitled thereto, of the principal, premium, if any
and interest for whose payment such money has been deposited with the Trustee.

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     SECTION 14.03. Upon the satisfaction and discharge of this Indenture all
moneys then held by any Paying Agent under the provisions of this Indenture
shall, upon demand of the Company, be repaid to it and thereupon such Paying
Agent shall be released from all further liability with respect to such moneys.

     SECTION 14.04. Any moneys deposited with the Trustee not applied but
remaining unclaimed by the Holders of the Securities of any series for two years
after the date upon which the principal of and premium, if any, or interest on
such Securities shall have become due and payable shall be repaid to the Company
by the Trustee on demand: and the Holder of any such Securities entitled to
receive such payment shall thereafter look only to the Company for the payment
thereof: provided, however, that the Trustee, before being required to make any
such repayment, may at the expense of the Company mail first-class postage
prepaid to each Holder of such Securities or cause to be published once a week
for two successive weeks (in each case on any day of the week) in a newspaper
printed in the English language and customarily published on each business day
and of general circulation in each Place of Payment with respect to such
Securities, a notice that said moneys have not been so applied and that after a
date named therein (which shall be not less than 30 days after such mailing or
the first such publication, as the case may be) any unclaimed balance of said
moneys then remaining will be returned to the Company.

ARTICLE FIFTEEN.

DEFEASANCE AND COVENANT DEFEASANCE.

     SECTION 15.01. If pursuant to Section 3.01 provision is made for either or
both of (a) defeasance of the Securities of a series under Section 15.02 or (b)
covenant defeasance of the Securities of a series under Section 15.03, then the
provisions of such Section or Sections, as the case may be, together with the
other provisions of this Article Fifteen, shall be applicable to the Securities
of such series, and the Company may at its option by resolution of its Board of
Directors, at any time, with respect to the Securities of such series, elect to
have either Section 15.02 (if applicable) or Section 15.03 (if applicable) be
applied to the Outstanding Securities of such series upon compliance with the
conditions set forth below in this Article.

     SECTION 15.02. Upon the Company’s exercise of the above option applicable
to this Section, the Company shall be deemed to have been discharged from its
obligations with respect to the Outstanding Securities of such series on the
date the conditions set forth below are satisfied (hereinafter, “defeasance”).
For this purpose, such defeasance means that the Company shall be deemed to have
paid and discharged the entire indebtedness represented by the Outstanding
Securities of such series and to have satisfied all its other obligations under
such Securities and this Indenture insofar as such Securities are concerned (and
the Trustee. at the expense. of the Company, shall execute proper instruments
acknowledging the same), except for the following which shall survive until
otherwise terminated or discharged hereunder: (A) the rights of Holders of
Outstanding Securities of such series to receive, solely from the trust fund
described in Section 15.04 and as more fully set forth in such Section, payments
in respect of the principal of, and premium, if any, and interest on such
Securities when such payments are due, (B) the Company’s obligations with
respect to such Securities under Sections 3.05, 3.06, 3.07, 6.02 and 6.06(b),
and 9.06(C) the rights, powers, trusts, duties, and immunities of the Trustee
hereunder and (D) this Article. Subject to compliance with this Article, the
Company may exercise its option under Section 15.02 notwithstanding the prior
exercise of its option under Section 15.03 with respect to the Securities of
such series.

     SECTION 15.03. Upon the Company’s exercise of the above option applicable
to this

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Section, the Company shall be released from its obligations under Section 6.04
with respect to the Outstanding Securities of such series on and after the date
the conditions set forth below are satisfied (hereinafter, “covenant
defeasance”). For this purpose, such covenant defeasance means that, with
respect to the Outstanding Securities of such series, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in such Section, whether directly or indirectly by reason
of any reference elsewhere herein to such Section or by reason of any reference
in such Section to any other provision herein or in any other document and such
omission to comply shall not constitute an Event of Default under Section
8.01(d), but the remainder of this Indenture and such Securities shall be
unaffected thereby.

     SECTION 15.04. The following shall be the conditions to application of
either Section 15.02 or Section 15.03 to the Outstanding Securities of such

series:

     (1) the Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements of
Section 9.09 who shall agree to comply with the provisions of this Article
Fifteen applicable to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of such Securities, (A) money in an amount, or
(B) Eligible Obligations and/or U.S. Government Obligations which through the
scheduled payment of principal and interest in respect thereof in accordance
with their terms will provide, not later than one day before the due date of any
payment, money in an amount, or (C) a combination thereof, sufficient. in the
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, to pay
and discharge, and which shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge, (i) the principal of (and premium, if any, on)
and each instalment of principal of and premium, if any and interest on the
Outstanding Securities of such series on the stated maturity of such principal
or instalment of principal or interest and (ii) any mandatory sinking fund
payments or analogous payments applicable to the Outstanding Securities of such
series on the day on which such payments are due and payable in accordance with
the terms of this Indenture and or such Securities.

     (2)No Event of Default with respect to the Securities of such series shall
have occurred and be continuing on the date of such deposit.

     (3)Such defeasance or covenant defeasance shall not constitute a default
(after the expiration of any periods of grace or the giving of notice or both)
under this Indenture with respect to Securities of any other series or under any
other agreement or instrument to which the Company is a party or by which it is
bound.

     (4)Such defeasance or covenant defeasance shall be effected in compliance
with any additional terms, conditions or limitations which may be
imposed on the Company in connection therewith pursuant to Section 3.01.

     (5) The Company shall have delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the defeasance under Section 15.02 or
the covenant defeasance under Section 15.03 (as the case may be) have been
complied with.

     Notwithstanding the foregoing, if an Event of Default specified in
Sections 8.01(f) and 8.01(g), or an event which with lapse of time would become
such an Event of Default, shall occur during the period ending on the 91st day
after the date of the deposit referred to in Section 15.04(I), then, effective
upon such occurrence, the defeasance or covenant defeasance and such

59

 

deposit shall be rescinded and annulled, and the Company, the Trustee and the
Holders of the Securities of such series shall be restored to their former
positions.

     SECTION 15.05. Subject to the provisions of Section 14.04, all money and
Eligible Obligations and U.S. Government Obligations (including the proceeds
thereof) deposited with the Trustee (or other qualifying trustee-collectively
for purposes of this Section 15.05, the “Trustee”) pursuant to Section 15.04 in
respect of the Outstanding Securities of such series shall be held in trust and
applied by the Trustee, in accordance with the provisions of such Securities and
this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of such Securities of all sums due and to become due
thereon in respect of principal and premium, if any and interest, but such money
need not be segregated from other funds except to the extent required by law.

     The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the money, Eligible Obligations or
U.S. Government Obligations deposited pursuant to Section 15.04 or the principal
and interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the Outstanding
Securities of such series.

     Anything in this Article Fifteen to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money. Eligible Obligations or U.S. Government Obligations
held by it as provided in Section 15.04 which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, are in excess of the amount
thereof which would then be required to be deposited to effect an equivalent
defeasance or covenant defeasance.

ARTICLE SIXTEEN

MISCELLANEOUS PROVISIONS

     SECTION 16.01. All the covenants, stipulations, promises and agreements
contained in this Indenture by or on behalf of the Company shall bind
its successors and assigns, whether so expressed or not.

     SECTION 16.02. Any act or proceeding by any provision of this Indenture
authorized or required to be done or performed by any board, committee or
officer of the Company shall and may be done and performed with like force and
effect by the like board, committee or officer of any corporation that shall at
the time be the lawful sole successor of the Company.

     SECTION 16.03. Any notice or demand which by any provision of this
Indenture is required or permitted to be given or served by the Trustee or by
the Holders of Securities on the Company may be given or served by being
deposited postage prepaid in a post office of the United States of America or in
a United States post-office letter box addressed (until another address is filed
by the Company with the Trustee), as follows: Southern Natural Gas Company, P.O.
Box 2563, Birmingham, Alabama 35202, Attention: Vice President-Finance. Any
notice, direction request or demand by any Holder to or upon the Trustee shall
be deemed to have been sufficiently given or made, for all purposes, if given or
made in writing at the Principal Office of the Trustee. Any notice required to
be mailed to a Holder by the Company or the Trustee pursuant to any of the
provisions of this Indenture shall be deemed to be properly mailed by being
deposited postage prepaid in a post office of the United States of America or in
a United States post-office letter box addressed to such Holder at the address
of such Holder as shown on the

60

 

registry books of the Company.

     SECTION 16.04. This Indenture and each Security shall be deemed to be a
contract made under the laws of the State of New York, and for all purposes
shall be construed in accordance with the laws of said State.

     SECTION 16.05. Upon any application or demand by the Company to the
Trustee to take any action under any of the provisions of this Indenture, the
Company shall furnish to the Trustee an Officers’ Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with and an Opinion of Counsel stating that
in the opinion of such counsel all such conditions precedent have been complied
with.

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

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

     Any certificate or opinion of an officer of the Company or of counsel
may be based, in so far as it relates to accounting matters, upon a certificate
or opinion of, or representations by, an accountant or firm of accountants,
unless such officer or counsel, as the case may be, knows, or in the exercise of
reasonable care should know that the certificate or opinion or representations
with respect to the accounting matters upon which his certificate or opinion is
based are erroneous.

     SECTION 16.06 Nothing in this Indenture or in the Securities, expressed
or implied, shall give or be construed to give to any person, firm or
corporation other than the parties hereto, any Paying Agent and the Holders of
the Securities any legal or equitable right remedy or claim under or in respect
of this Indenture or under any covenant, condition or provision herein
contained; all its covenants, conditions and provisions being for the sole
benefit of the parties hereto, any Paying Agent and of the Holders of the
Securities.

61

 

     SECTION 16.07. If and to the extent that any provision of this
Indenture limits, qualifies or conflicts with another provision included in this
Indenture which is required to be included in this Indenture by any of Sections
310 to 317, inclusive, of the Trust Indenture Act of 1939, such required
provision shall control.

     SECTION 16.08. This Indenture may be executed in any number of
counterparts, each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.

     SECTION 16.09. The Table of Contents and the titles and headings of the
Articles of this Indenture have been inserted for convenience of reference only,
are not to be considered a part hereof, and shall in no way modify or restrict
any of the terms or provisions hereof.

     SECTION 16.10. 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 16.11. In any case where any interest payment date, Redemption
Date or date of maturity of any Security shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of interest or principal, and premium, if any, need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the interest payment date or Redemption Date, or at the
date of maturity, provided that no interest shall accrue for the period from and
after such interest payment date, Redemption Date or date of maturity, as the
case may be.

     SECTION 16.12. No recourse under or upon any obligation, covenant or
agreement of this Indenture, or of any Security, or for any claim based thereon
or otherwise in respect thereof, shall be had against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor corporation, either directly or through the Company;
it being expressly understood that this Indenture and the obligations issued
hereunder are solely corporate obligations, and that no such personal liability
whatever shall attach to, or is or shall be incurred by, the incorporators,
stockholders, officers or directors, as such, of the Company or of any successor
corporation or any of them, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or agreements
contained in this Indenture or in any of the Securities or implied therefrom;
and that any and all such personal liability of every name and nature of, and
any and all such rights and claims against, every such incorporator,
stockholder, officer or director, because of the creation of the indebtedness
hereby authorized, or under or by reason of the obligations, covenants or
agreements contained in this Indenture or in any of the Securities or implied
therefrom, are hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Indenture and the issue of such
Securities.

MANUFACTURERS HANOVER TRUST COMPANY hereby accepts the trust in this Indenture
declared and provided upon the terms and conditions hereinabove set forth.

62

 

In Witness Whereof, Southern Natural Gas Company has caused this Indenture to be
signed in its name and acknowledged by its Chairman of the Board, its President,
one of its Vice Presidents or its Assistant Treasurer, and its corporate seal to
be affixed hereunto, and the same to be attested by its Secretary or one of its
Assistant Secretaries; and Manufacturers Hanover Trust Company has caused this
Indenture to be signed in its name and acknowledged by one of its Vice
Presidents or Assistant Vice Presidents, and its corporate seal to be affixed
hereunto, and the same to be attested by one of its Assistant Secretaries.

Executed and delivered as of the day and year first written above.

	 	 	 	 	 	 	 	 	 
	 	 	 	 	SOUTHERN NATURAL GAS COMPANY	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By
	 	/s/ John M. Musgrove
 

          Treasurer
	 	 
	Attest:

	 	/s/ R. David Hendrickson
 

          Secretary
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	[SEAL]
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	MANUFACTURERS HANOVER TRUST COMPANY	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By
	 	/s/ D.A. Ursitti
 

	 	 
	 

	 	 	 	 	 	           Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	Attest:

	 	/s/ William B. Dodge
 

          Assistant Vice President
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	[Seal]
	 	 	 	 	 	 	 	 

63

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