Document:

Exhibit 10.1

HEARST-ARGYLE
TELEVISION, INC.

AMENDED
AND RESTATED 1997 STOCK OPTION PLAN

WHEREAS, on August
28, 1997 the stockholders of Hearst-Argyle Television, Inc. adopted the
Hearst-Argyle Television, Inc 1997 Stock Option Plan; and

WHEREAS,
Hearst-Argyle Television, Inc. desires to amend and restate the Hearst-Argyle
Television, Inc 1997 Stock Option Plan as set forth herein and to adopt such
amendment and restatement as the resulting “Amended and Restated 1997 Stock
Option Plan”, subject to approval by the stockholders of Hearst-Argyle
Television, Inc. (the “Approval”).

1. Plan Name and Purpose. Following the
Approval, the 1997 Stock Option Plan, as amended and restated herein, shall be
known as the “Hearst-Argyle Television, Inc. Amended and Restated 1997 Stock
Option Plan”, hereinafter referred to as the “Plan.” The purposes of the Plan
are (i) to provide incentives for key employees and Non-Employee Directors (as
hereinafter defined) of Hearst-Argyle Television, Inc. (the “Company”), and its
subsidiary corporations (within the meaning of Section 424(f) of the Internal
Revenue Code of 1986, as amended, (the “Code”) and referred to herein as “Subsidiaries”)
by encouraging their ownership of Series A common stock, $0.01 par value, of
the Company (the “Stock”) and (ii) to aid the Company in retaining such key
employees and Non-Employee Directors, upon whose efforts the Company’s success
and future growth depends, and attracting other such employees and Non-Employee
Directors.

2. Administration. This Plan shall be
administered by the Company’s Board of Directors. Subject to the terms of this
Plan, the Board shall have plenary authority to determine the persons to whom
options are to be granted, the number of shares to be subject to each such
option, to determine the terms and provisions of any option agreements made
pursuant to the Plan, to modify such agreements, and to make all other
determinations that may be necessary or advisable for the administration of the
Plan. For purposes of administration, the Board, subject to the terms of this
Plan, shall have plenary authority to establish such rules and regulations,
make such determinations and interpretations, and take such other
administrative actions as it deems necessary or advisable. All determinations and
interpretations made by the Board shall be final, conclusive and binding on all
persons, including the holders of options granted under this Plan (“Optionees”)
and their legal representatives and beneficiaries.

The Board, in its
discretion, may delegate any or all of its authority, powers and discretion
under this Plan to the Compensation Committee (the “Committee”), and the Board
in its discretion may revest any or all such authority, powers and discretion
in itself at any time. The Committee shall be appointed from time to time by
the Board of Directors. The Board of Directors shall designate one of the
members of the Committee as its Chairman. The Committee shall hold its meetings
at such times and places as it may determine. A majority of its members shall
constitute a quorum. All determinations of the Committee shall be made by a
majority of its members. Any decision or determination reduced to writing and
signed by all members of the Committee shall be as effective as if it had been
made by a majority vote at a Committee meeting duly called and held. The
Committee may appoint a secretary (who need not be a member of the Committee).
No member of the Committee shall be liable for any act or omission with respect
to his or her service on the Committee, if he or she acts in good faith and in
a manner he or she reasonably believes to be in or not opposed to the best
interests of the Company.

With respect to
persons subject to Section 16 of the Securities Exchange Act of 1934, as
amended, or any successor statute (the “1934 Act”), transactions under the Plan
are intended to comply with all applicable conditions of Rule 16b-3 or its
successors under the 1934 Act (“Rule 16b-3”). To the extent any provision of
the Plan or action by the Board of Directors of the Committee fails to so
comply, it shall be deemed null and void, to the extent permitted by law.

3. Shares of Stock Available for Options. The
aggregate number of shares of Stock that may be issued under this Plan shall
equal 8,745,362, subject to any adjustments that may be made pursuant to
Section 5(g) hereof. Shares of Stock used for purposes of this Plan may be
either authorized or unissued shares, or previously issued shares, held in the
treasury of the Company, or both. Immediately upon the termination or
forfeiture of

 

 

any option granted under
this Plan (other than by reason of exercise or other cancellation for
consideration), any shares of Stock covered by such option shall be available
for grant as further options hereunder.

Unless
specifically defined otherwise, “Fully Diluted Shares” means, as of any date,
the sum of (i) the number of shares of Stock then outstanding (not including
any shares held in treasury) and (ii) without duplication, the number of shares
of Stock issuable upon conversion, exchange or exercise of all outstanding
securities, other obligations, options or warrants, convertible into,
exchangeable for or otherwise providing the right to acquire such shares.

4. Eligibility. Options under this Plan may
be granted to key employees and Non-Employee Directors of the Company or any
Subsidiary. In selecting persons to be granted options, the Board may take into
consideration any factors it may deem relevant, including its estimate of the
person’s present and potential contributions to the success of the Company and
its Subsidiaries. The maximum number of shares of Stock with respect to which
stock options may be granted in any one year to any employee shall not exceed
500,000.

5. Terms and Conditions of Options. The Board
shall, in its discretion, prescribe the terms and conditions of the options to
be granted hereunder, which terms and conditions need not be the same in each
case, subject to the following:

(a) Option
Agreement. Each option granted under this Plan shall be evidenced by
a written option agreement, which shall be executed by the Optionee and an
authorized officer of the Company and which shall contain such terms and
conditions as the Board shall deem appropriate, consistent with the terms of
this Plan.

(b) Option Price.
The price at which each share of Stock covered by an option granted under this
Plan may be purchased shall be determined by the Board and shall not be less
than the fair market value per share of Stock at the time of grant, subject to
the incentive stock option provisions set forth in Section 6. The date of the
grant of an option shall be the date specified by the Board in its grant of the
option.

(c) Option Period.
The period for exercise of an
option shall not exceed ten (10) years plus one day from the date of grant,
subject to the provisions of Sections 5(e), 5(h), 6, and the provisions of any
option agreement.

(d) Exercise of
Options. In order to exercise all or any portion of an option
granted under this Plan, the Optionee, or his or her representative, devisees
or heirs, as applicable, shall deliver to the Company written notice specifying
the number of shares of Stock to be purchased, together with (i) cash or a
certified or bank cashier’s check payable to the order of the Company, (ii)
shares of Company Stock having a fair market value equal to the purchase price
therefore or (iii) if approved by the Board in its discretion, a request that
payment be made by having shares of Stock withheld by the Company from the
shares otherwise to be received, with such withheld shares having an aggregate
fair market value on the date of exercise equal to the aggregate option
purchase price.  An Optionee shall have
none of the rights of a stockholder until the shares of Stock are issued to him
or her.  An option may not be exercised
for less than one hundred (100) shares of Stock, or the number of shares of
Stock remaining subject to such option, whichever is less.

(e) Effect of
Termination of Employment or Service as a Non-Employee Director.
Except as may be set forth in any option agreement, the following provisions of
this Section 5(e) shall govern the treatment of options upon the termination of
an Optionee’s employment or service as a non-employee director by the Company
and each of the Subsidiaries (hereinafter, the “Optionee’s Employment or
Service”):

(i) An option will automatically be forfeited and
unexercisable upon the termination of an Optionee’s Employment or Service if
such termination was for Cause (as defined below) or was voluntary by the
Optionee (other than voluntary termination in connection with the Optionee’s
retirement upon or after such Optionee reaches age 65 (“Retirement Age”).
Unless otherwise specifically defined in an Option Agreement, a termination
shall be for “Cause” if the Company (or a Subsidiary) terminates the Optionee’s
Employment or Service because (A) the Optionee is convicted of a crime that is
a felony (other than a traffic or moving violation); (B) the Optionee has
willfully and materially breached, habitually neglected or failed to perform
satisfactorily his or 

 

 2
 

 

her duties as an employee, consultant or non-employee director; or, (C)
the Optionee commits any material act or fraud or dishonesty during the course
of the Optionee’s Employment or Service.

(ii) If an Optionee’s Employment or Service is
terminated because of (A) the death of the Optionee or (B) the Disability (as
defined in subsection (v) below) of the Optionee, the Optionee, or his or her
representative, devisees or. heirs, as applicable, may exercise any options
granted under this Plan that are exercisable on the date the Optionee’s
Employment or Service so terminates at any time prior to thirty-six months from
the date of such termination.

(iii) If an Optionee’s Employment or Service is
terminated because of the retirement of the Optionee at or after the Optionee
reaches Retirement Age, then the Optionee may exercise any options granted
under this Plan that are exercisable on the date the Optionee’s Employment or
Service so terminates at any time prior to thirty-six months from the date of
such termination, subject to the incentive stock option provisions set forth in
Section 6.

(iv) If the Company terminates the Optionee’s
Employment or Service for any reason other than for Cause, then the Optionee,
or his or her representative, devisees or heirs, as applicable, may exercise
any options granted under this Plan that are exercisable on the date the
Optionee’s Employment or Service so terminates at any time prior to one year
from the date of such termination, subject to the incentive stock option
provisions set forth in Section 6. Notwithstanding the foregoing, if the
Optionee’s Employment or Service is terminated because the Optionee has become
an employee of another company that is affiliated with the Company, through
common ownership, common management or otherwise, then the options granted to
such Optionee under this Plan shall not be deemed to be terminated, but rather
shall continue in full force and effect as if the Optionee’s Employment or
Service had not been terminated.

(v) Unless otherwise specifically defined in an Option
Agreement, “Disability,” as such term is used herein, shall refer to the
Optionee becoming physically or mentally disabled (as determined in good faith
by the Board) so that Optionee is unable to perform Optionee’s duties which
Optionee is required to perform for a period of more than one hundred twenty
(120) consecutive days or more than one hundred eighty (180) days in the
aggregate during any calendar year.

(vi) If an Optionee’s Employment or Service is
terminated with the approval of the Board, the Board may, at its discretion,
accelerate or otherwise modify the vesting conditions applicable to any options
which are not exercisable on the date the Optionee’s Employment or Service
terminates, extend the period following termination of employment during which
any outstanding options may be exercised (but in no event beyond the original
exercise term of the grant), or modify the vesting terms and extend the
exercise term of the grant.

(vii) Nothing in this Plan or in any option granted
pursuant to this Plan (in the absence of an express provision to the contrary)
shall confer on any individual any right to continue in the employ of the
Company or any Subsidiary, to continue to serve as a member of the Board, or to
interfere in any way with the right of the Company to terminate his or her
Employment or Service at any time.

(f) Transferability
of Options. During the lifetime of an Optionee, options held by such
Optionee shall be exercisable only by the Optionee or his or her personal
representative in the event of the Optionee’s Disability. In the event of
Optionee’s death, options that remain exercisable under the terms of this Plan
and the applicable Option Agreements may be exercised by the Optionee’s representative,
devisees or heirs, as applicable. Options shall be transferable by will or the
laws of descent and distribution. Notwithstanding the foregoing, the Board may
permit an Optionee to transfer exercise rights to any outstanding non-qualified
stock options, provided such transfers are made to Permitted Transferees, as defined
herein, and are made without consideration, for bona fide estate planning
purposes. The Board shall establish whatever administrative criteria it deems
appropriate in reviewing and approving such transfer requests. For purposes of
this Section 5(f), “Permitted Transferees” shall mean a member of an Optionee’s
immediate family, trusts for the benefit of such immediate family members, and
partnerships in which the Optionee and/or such immediate family members are the
only partners. Immediate family members shall include an Optionee’s spouse,
descendants (children, grandchildren and more remote descendants), and shall
include step-children and relationships arising from legal adoption.

(g) Adjustments for
Change in Stock Subject to Plan and Other Events. Subject to any
more particular

 3
 

 

 

rights that the Board may grant to an Optionee under an Option
Agreement, in the event of a reorganization, recapitalization,
reclassification, stock split, stock dividend, combination of shares, merger,
consolidation, rights offering, or any other change in or event affecting the
corporate structure or Stock of the Company, the Board may make such
adjustments, if any, in the number of shares subject to this Plan and in the
number of shares covered by outstanding options and/or in the option price per
share as it deems appropriate and necessary to preserve the value of the
benefits provided hereunder.

(h) Acceleration of
Exercisabiity of Options Upon Occurrence of Certain Events. The
Board may provide, in an Option Agreement relating to any option granted
hereunder, that in connection with any Change of Control (as hereinafter
defined) of the Company, effective as of such date as the Board shall
determine, the exercisability of such option shall be accelerated and the
option may be immediately exercised to purchase all or any portion of the
shares of Stock subject to such option, or all or a portion of such option may
be terminated, as determined by the Board.

“Change of Control” shall mean (i) a merger or
consolidation in which the Company is a constituent corporation following which
securities of the surviving or resulting corporation possessing less than 50%
of the combined voting power of such corporation’s outstanding voting
securities (computed on either an actual or fully diluted basis) with respect
to matters submitted to a vote of the stockholders generally shall then be
owned in the aggregate by persons who prior thereto were stockholders of the
Company; (ii) a sale or transfer by the Company or any of its Subsidiaries of
all or substantially all of the consolidated assets of the Company and its
Subsidiaries to an entity that is not a Subsidiary of the Company; (iii) any “person”
(as such term is used in Sections 3(a)(9) or 13(d)(3) of the 1934 Act), other
than Excluded Persons, is or becomes the beneficial owner, directly or
indirectly, of securities of the Company representing more than 50% of the
combined voting power of the Company’s then outstanding voting securities with
respect to matters submitted to a vote of the stockholders generally; (iv) any “person”
other than Excluded Persons is or becomes the beneficial owner, directly or
indirectly, of securities of the Company representing more than 50% of the then
outstanding Stock; (v) at such time as any shares of Series B common stock,
$0.01 par value, of the Company are no longer outstanding, within any two-year
period, a majority of the Company’s Board of Directors is no longer composed of
persons who were directors at the beginning of such two-year period, unless the
continuing directors, together with the new directors who were approved by a
majority of the prior directors, constitute a majority of the Board; (vi) the
Company adopts a plan of dissolution or liquidation or liquidates or dissolves;
or (vii) any transaction or series of transactions which has a reasonable
likelihood or a purpose of producing, directly or indirectly, any of the
effects described in paragraph (a)(3)(ii) of Rule 13e-3 of the 1934 Act. The
term “Excluded Persons” means. each of (i) The Hearst Corporation or any other “Permitted
Transferee” (as defined in Article Four of the Company’s Amended and Restated
Certificate of Incorporation) and (ii) a trustee or other fiduciary holding
securities under any employee benefit plan of the Company.

Notwithstanding the foregoing, in no event shall any
option be exercisable after the date of termination of the exercise period of
such option specified in Section 5(c).

(i) Stock Legends.
Certificates evidencing shares of Stock issued under the Plan shall have
conspicuously noted thereon such restrictions on transferability as the Company
may require in order to ensure compliance with applicable federal and state
securities laws and regulations.

(j) Options for
Non-Employee Directors. Notwithstanding any provision herein to the
contrary, each Non-Employee Director of the Company shall be awarded options to
purchase 4,000 shares of Stock each year that such person continues to serve as
a director of the Company, and an additional 1,000 shares of Stock each year
that such person serves as a chairperson of a committee of the Board. The
initial grant to each Non-Employee Director shall have been made as of the
adoption of the 1997 Stock Option Plan (or as soon thereafter as is reasonably
practicable) and each subsequent annual grant shall be made on each anniversary
of the date of the initial grant for as long as such Non-Employee Director
continues to serve as a director of the Company or any of its Subsidiaries. All
such options granted to the Non-Employee Directors shall have an exercise price
equal to the fair market value of the Stock as of the date of grant (as
determined by the Board of Directors), shall become fully exercisable two (2)
years from the date of grant and shall expire ten (10) years from the date of
grant.

“Non-Employee Director”, as defined by Rule 16b-3
shall mean a director of the Company who (i) is 

 4
 

 

not currently an officer of the Company or a parent or subsidiary of
the Company, or otherwise currently employed by the Company or a parent or
subsidiary of the Company; (ii) does not receive compensation, either directly
or indirectly, from the Company or a parent or subsidiary of the Company, for
services rendered as a consultant or in any capacity other than as a director,
except for an amount that does not exceed the dollar amount for which
disclosure would be required pursuant to Item 404(a) of Regulation S-K; (iii)
does not possess an interest in any other transaction for which disclosure
would be required pursuant to Item 404(a) of Regulation S-K; and (iv) is not
engaged in a business relationship for which disclosure would be required
pursuant to Item 404(b) of Regulation S-K.

(k) Other Terms and
Conditions. The Board may impose such other terms and conditions,
not inconsistent with the terms hereof, on the grant or exercise of options, as
it deems advisable.

6. Provisions Applicable to Incentive Stock Options.
The Committee may, in its discretion, grant options under this Plan to eligible
employees which constitute “incentive stock options” (within the meaning of
Section 422(b) of the Code), provided,
however, that the following provisions shall be applicable to such
options (“Incentive Stock Options”):

(a) No Incentive Stock Option shall be exercisable
more than ten (10) years from the date of grant thereof.

(b) To the extent that the aggregate fair market value
(determined at the time the respective Incentive Stock Option is granted) of
Stock with respect to which Incentive Stock Options are exercisable for the
first time by an individual during any calendar year under all incentive stock
option plans for the Company and its Subsidiaries exceeds $100,000, such excess
Incentive Stock Options shall be treated as options which do not constitute
Incentive Stock Options.

(c) No Incentive Stock Option shall be granted to an
individual if, at the time the option is granted, such individual owns stock
possessing more than 10% of the total combined voting power of all classes of
stock, of the Company or of its Subsidiaries, unless (i) at the time such
option is granted the option price is at least 110% of the fair market value of
the Stock subject to the option, and (ii) such option by its terms is not
exercisable after the expiration of five (5) years from the date of grant.

(d) The purchase price of a share of Stock under an
Incentive Stock Option shall be no less than 100% of the fair market value of a
share of Stock as of the date such option is granted.

(e) An Incentive Stock Option shall be exercisable
only while the Optionee is an employee of the Company or a Subsidiary, or
within three (3) months after the date that the Optionee’s employment with the
Company is terminated for reasons other than death or Disability, for Cause, or
voluntary termination by the Optionee.

7. Amendment and Termination. Unless this
Plan previously shall have been terminated as hereinafter provided, this Plan
shall terminate on, and no option shall be granted hereunder, ten (10) years
from (i) the date the 1997 Stock Option Plan was adopted by the Board or (ii)
the date the 1997 Stock Option Plan was approved by the Company’s stockholders,
whichever is earlier; provided, however, that the Board may at any time prior
to that date terminate this Plan. The Board may at any time amend this Plan; provided, however, that an amendment shall
be subject to stockholder approval if such approval is required for favorable
treatment under Rule 16b-3 or the Code or is required by the rules of any
securities exchange or market system on which securities of the Company are
listed, reported or admitted to trading at the time such amendment is adopted.
No termination or amendment of this Plan may, without the consent of an
Optionee, adversely affect the rights of such Optionee under any option held by
such Optionee. Notwithstanding anything in this Section 7 to the contrary, this
Plan may from time to time be amended to satisfy or otherwise conform to the
conditions and requirements and provisions set forth in Rule 16b-3 or in any
successor role.

8. Withholding. It shall be a condition to
the obligation of the Company to issue shares of Stock upon exercise of an
option, that the Optionee (or any beneficiary or other person entitled to act
under the terms hereof) pay to the Company, upon its demand, such amount as may
be requested by the Company for the purpose of satisfying any liability to
withhold federal, state or local income or other taxes. Without limiting the
generality of the foregoing, Optionees may be given the opportunity to elect to
have shares of Stock acquired through exercise of the option withheld to
satisfy withholding tax obligations.

As
amended on September 21, 2006

 5Exhibit 4.1

Execution
Copy

 

 

CORPORATE OFFICE PROPERTIES,
L.P., as Issuer

CORPORATE OFFICE PROPERTIES
TRUST, as Guarantor

WELLS FARGO BANK, NATIONAL
ASSOCIATION, as Trustee

 

INDENTURE

Dated as of

September 18, 2006

3.50% Exchangeable Senior Notes due 2026

 

 

TABLE OF CONTENTS

 

	
  

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE 1             DEFINITIONS

  	
  1

  
	
  Section 1.01.

  	
  Definitions

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2             ISSUE, DESCRIPTION, EXECUTION,
  REGISTRATION AND TRANSFER OF NOTES

  	
  10

  
	
  Section 2.01.

  	
  Designation Amount and Issue of Notes

  	
  10

  
	
  Section 2.02.

  	
  Form of Notes

  	
  10

  
	
  Section 2.03.

  	
  Date and Denomination of Notes; Payments of Interest

  	
  11

  
	
  Section 2.04.

  	
  Execution of Notes

  	
  12

  
	
  Section 2.05.

  	
  Exchange and Registration of Transfer of Notes;
  Restrictions on Transfer

  	
  12

  
	
  Section 2.06.

  	
  Mutilated, Destroyed, Lost or Stolen Notes

  	
  17

  
	
  Section 2.07.

  	
  Temporary Notes

  	
  18

  
	
  Section 2.08.

  	
  Cancellation of Notes

  	
  18

  
	
  Section 2.09.

  	
  CUSIP Numbers

  	
  19

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3             REDEMPTION AND REPURCHASE OF
  NOTES

  	
  19

  
	
  Section 3.01.

  	
  Optional Redemption of Notes

  	
  19

  
	
  Section 3.02.

  	
  Notice of Optional Redemption; Selection of Notes

  	
  19

  
	
  Section 3.03.

  	
  Payment of Notes Called for Redemption by the Issuer

  	
  21

  
	
  Section 3.04.

  	
  Sinking Fund

  	
  21

  
	
  Section 3.05.

  	
  Repurchase of Notes at Option of the Noteholder on
  Specified Dates

  	
  21

  
	
  Section 3.06.

  	
  Repurchase at Option of Noteholders Upon a
  Fundamental Change

  	
  24

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4             PARTICULAR COVENANTS OF THE
  ISSUER

  	
  27

  
	
  Section 4.01.

  	
  Payment of Principal, Premium and Interest

  	
  27

  
	
  Section 4.02.

  	
  Maintenance of Ofice or Agency

  	
  27

  
	
  Section 4.03.

  	
  Appointments to Fill Vacancies in Trustee’s Office

  	
  28

  
	
  Section 4.04.

  	
  Provisions as to Paying Agent

  	
  28

  
	
  Section 4.05.

  	
  Existence

  	
  29

  
	
  Section 4.06.

  	
  Rule 144A Information Requirement

  	
  29

  
	
  Section 4.07.

  	
  Stay, Extension and Usury Laws

  	
  29

  
	
  Section 4.08.

  	
  Compliance Certificate

  	
  29

  
	
  Section 4.09.

  	
  Additional Interest Notice

  	
  29

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5             NOTEHOLDERS’ LISTS AND REPORTS BY
  THE ISSUER AND THE TRUSTEE

  	
  30

  
	
  Section 5.01.

  	
  Noteholders’ Lists

  	
  30

  

 

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  Section 5.02.

  	
  Preservation and Disclosure of Lists

  	
  30

  
	
  Section 5.03.

  	
  Reports by Trustee

  	
  30

  
	
  Section 5.04.

  	
  Reports by Issuer

  	
  30

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6             REMEDIES OF THE TRUSTEE AND
  NOTEHOLDERS ON AN EVENT OF DEFAULT

  	
  31

  
	
  Section 6.01.

  	
  Events of Default

  	
  31

  
	
  Section 6.02.

  	
  Payments of Notes on Default; Suit Therefor

  	
  33

  
	
  Section 6.03.

  	
  Application of Monies Collected by Trustee

  	
  34

  
	
  Section 6.04.

  	
  Proceedings by Noteholders

  	
  35

  
	
  Section 6.05.

  	
  Proceedings by Trustee

  	
  35

  
	
  Section 6.06.

  	
  Remedies Cumulative and Continuing

  	
  35

  
	
  Section 6.07.

  	
  Direction of Proceedings and Waiver of Defaults by
  Majority of Noteholders

  	
  36

  
	
  Section 6.08.

  	
  Notice of Defaults

  	
  36

  
	
  Section 6.09.

  	
  Undertaking to Pay Costs

  	
  36

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7             THE TRUSTEE

  	
  37

  
	
  Section 7.01.

  	
  Duties and Responsibilities of Trustee

  	
  37

  
	
  Section 7.02.

  	
  Reliance on Documents, Opinions, etc.

  	
  38

  
	
  Section 7.03.

  	
  No Responsibility for Recitals, etc.

  	
  39

  
	
  Section 7.04.

  	
  Trustee, Paying Agents, Exchange Agents or Registrar
  May Own Notes

  	
  39

  
	
  Section 7.05.

  	
  Monies to Be Held in Trust

  	
  39

  
	
  Section 7.06.

  	
  Compensation and Expenses of Trustee

  	
  39

  
	
  Section 7.07.

  	
  Officers’ Certificate as Evidence

  	
  40

  
	
  Section 7.08.

  	
  Conflicting Interests of Trustee

  	
  40

  
	
  Section 7.09.

  	
  Eligibility of Trustee

  	
  40

  
	
  Section 7.10.

  	
  Resignation or Removal of Trustee

  	
  40

  
	
  Section 7.11.

  	
  Acceptance by Successor Trustee

  	
  41

  
	
  Section 7.12.

  	
  Succession by Merger

  	
  42

  
	
  Section 7.13.

  	
  Preferential Collection of Claims

  	
  42

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8             THE NOTEHOLDERS

  	
  42

  
	
  Section 8.01.

  	
  Action by Noteholders

  	
  42

  
	
  Section 8.02.

  	
  Proof of Execution by Noteholders

  	
  43

  
	
  Section 8.03.

  	
  Absolute Owners

  	
  43

  

 

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  Section 8.04.

  	
  Issuer-owned Notes Disregarded

  	
  43

  
	
  Section 8.05.

  	
  Revocation of Consents; Future Holders Bound

  	
  43

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9             SUPPLEMENTAL INDENTURES

  	
  44

  
	
  Section 9.01.

  	
  Supplemental Indentures Without Consent of
  Noteholders

  	
  44

  
	
  Section 9.02.

  	
  Supplemental Indenture With Consent of Noteholders

  	
  45

  
	
  Section 9.03.

  	
  Effect of Supplemental Indenture

  	
  46

  
	
  Section 9.04.

  	
  Notation on Notes

  	
  46

  
	
  Section 9.05.

  	
  Evidence of Compliance of Supplemental Indenture to
  Be Furnished to Trustee

  	
  46

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10           CONSOLIDATION, MERGER, SALE,
  CONVEYANCE AND LEASE

  	
  46

  
	
  Section 10.01.

  	
  Issuer May Consolidate on Certain Terms

  	
  46

  
	
  Section 10.02.

  	
  Issuer Successor to Be Substituted

  	
  47

  
	
  Section 10.03.

  	
  Guarantor May Consolidate on Certain Terms

  	
  47

  
	
  Section 10.04.

  	
  Guarantor Successor to Be Substituted

  	
  48

  
	
  Section 10.05.

  	
  Assumption by Guarantor

  	
  48

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11           SATISFACTION AND DISCHARGE OF
  INDENTURE

  	
  48

  
	
  Section 11.01.

  	
  Discharge of Indenture

  	
  48

  
	
  Section 11.02.

  	
  Deposited Monies to Be Held in Trust by Trustee

  	
  49

  
	
  Section 11.03.

  	
  Paying Agent to Repay Monies Held

  	
  49

  
	
  Section 11.04.

  	
  Return of Unclaimed Monies

  	
  49

  
	
  Section 11.05.

  	
  Reinstatement

  	
  50

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12           IMMUNITY OF INCORPORATORS,
  SHAREHOLDERS, OFFICERS AND TRUSTEES

  	
  50

  
	
  Section 12.01.

  	
  Indenture and Notes Solely Corporate Obligations

  	
  50

  
	
   

  	
   

  	
   

  
	
  ARTICLE 13           EXCHANGE OF NOTES

  	
  50

  
	
  Section 13.01.

  	
  Exchange

  	
  50

  
	
  Section 13.02.

  	
  Exchange Procedures

  	
  53

  
	
  Section 13.03.

  	
  Adjustment of Exchange Rate

  	
  57

  
	
  Section 13.04.

  	
  Sufficient Shares to be Delivered

  	
  63

  
	
  Section 13.05.

  	
  Effect of Reclassification, Consolidation, Merger or
  Sale

  	
  63

  
	
  Section 13.06.

  	
  Certain Covenants

  	
  64

  
	
  Section 13.07.

  	
  Responsibility of Trustee

  	
  64

  
	
  Section 13.08.

  	
  Notice to Noteholders Prior to Certain Actions

  	
  65

  

 

 iii
 

 

 

	
  

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 13.09.

  	
  Shareholder Rights Plans

  	
  65

  
	
  Section 13.10.

  	
  Ownership Limit

  	
  65

  
	
  Section 13.11.

  	
  Tax Effect

  	
  66

  
	
  Section 13.12.

  	
  Taxes on Shares Issued

  	
  66

  
	
  Section 13.13.

  	
  Reservation of Shares, Shares to Be Fully Paid;
  Compliance with Governmental Requirements; Listing of Common shares

  	
  66

  
	
  Section 13.14.

  	
  Calculation in Respect of Notes

  	
  66

  
	
   

  	
   

  	
   

  
	
  ARTICLE 14           MEETINGS OF HOLDERS OF NOTES

  	
  66

  
	
  Section 14.01.

  	
  Purposes for Which Meetings May Be Called

  	
  67

  
	
  Section 14.02.

  	
  Call, Notice and Place of Meetings

  	
  67

  
	
  Section 14.03.

  	
  Persons Entitled to Vote at Meetings

  	
  67

  
	
  Section 14.04.

  	
  Quorum; Action

  	
  67

  
	
  Section 14.05.

  	
  Determination of Voting Rights; Conduct and
  Adjournment of Meetings

  	
  68

  
	
  Section 14.06.

  	
  Counting Votes and Recording Action of Meetings

  	
  68

  
	
   

  	
   

  	
   

  
	
  ARTICLE 15           GUARANTEE

  	
  69

  
	
  Section 15.01.

  	
  Guarantee

  	
  69

  
	
  Section 15.02.

  	
  Execution and Delivery of Guarantee

  	
  70

  
	
  Section 15.03.

  	
  Limitation of Guarantor’s Liability; Certain
  Bankruptcy Events

  	
  70

  
	
  Section 15.04.

  	
  Application of Certain Terms and Provisions to the
  Guarantor

  	
  70

  
	
   

  	
   

  	
   

  
	
  ARTICLE 16           MISCELLANEOUS PROVISIONS

  	
  71

  
	
  Section 16.01.

  	
  Provisions Binding on Issuer’s and Guarantor’s
  Successors

  	
  71

  
	
  Section 16.02.

  	
  Official Acts by Successor Corporation

  	
  71

  
	
  Section 16.03.

  	
  Addresses for Notices, etc.

  	
  71

  
	
  Section 16.04.

  	
  Governing Law

  	
  72

  
	
  Section 16.05.

  	
  Evidence of Compliance with Conditions Precedent,
  Certificates to Trustee

  	
  72

  
	
  Section 16.06.

  	
  Legal Holidays

  	
  72

  
	
  Section 16.07.

  	
  Trust Indenture Act

  	
  73

  
	
  Section 16.08.

  	
  No Security Interest Created

  	
  73

  
	
  Section 16.09.

  	
  Benefits of Indenture

  	
  73

  
	
  Section 16.10.

  	
  Table of Contents, Headings, etc.

  	
  73

  
	
  Section 16.11.

  	
  Authenticating Agent

  	
  73

  
	
  Section 16.12.

  	
  Execution in Counterparts

  	
  74

  

 

 iv
 

 

 

	
  

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 16.13.

  	
  Severability

  	
  74

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  Form of Note

  	
  A-1

  
				

 

 v
 

 

 

CROSS-REFERENCE TABLE*

	
  Trust Indenture Act

  	
   

  	
  Indenture Section

  
	
  310(a)(1)

  	
   

  	
  7.09

  
	
  (a)(2)

  	
   

  	
  7.09

  
	
  (a)(3)

  	
   

  	
  N.A.

  
	
  (a)(4)

  	
   

  	
  N.A.

  
	
  (a)(5)

  	
   

  	
  N.A.

  
	
  (b)

  	
   

  	
  7.08

  
	
  (c)

  	
   

  	
  N.A.

  
	
  311(a)

  	
   

  	
  7.13

  
	
  (b)

  	
   

  	
  7.13

  
	
  (c)

  	
   

  	
  N.A.

  
	
  312(a)

  	
   

  	
  5.01

  
	
  (b)

  	
   

  	
  5.02

  
	
  (c)

  	
   

  	
  5.02

  
	
  313(a)

  	
   

  	
  5.03

  
	
  (b)

  	
   

  	
  5.03

  
	
  (c)

  	
   

  	
  N.A.

  
	
  (d)

  	
   

  	
  5.03

  
	
  3 14(a)

  	
   

  	
  4.09, 5.04

  
	
  (b)

  	
   

  	
  N.A.

  
	
  (c)(1)

  	
   

  	
  N.A.

  
	
  (c)(2)

  	
   

  	
  N.A.

  
	
  (c)(3)

  	
   

  	
  N.A.

  
	
  (d)

  	
   

  	
  N.A.

  
	
  (e)

  	
   

  	
  N.A.

  
	
  (f)

  	
   

  	
  N.A.

  
	
  315(a)

  	
   

  	
  7.01

  
	
  (b)

  	
   

  	
  6.08

  
	
  (c)

  	
   

  	
  6.05

  
	
  (d)

  	
   

  	
  7.01

  
	
  (e)

  	
   

  	
  6.09

  
	
  3 16(a)(1)(A)

  	
   

  	
  6.07

  
	
  (a)(1)(B)

  	
   

  	
  6.07

  
	
  (a)(2)

  	
   

  	
  N.A.

  
	
  (b)

  	
   

  	
  N.A.

  
	
  (c)

  	
   

  	
  N.A.

  
	
  317(a)(1)

  	
   

  	
  N.A.

  
	
  (a)(2)

  	
   

  	
  N.A.

  
	
  (b)

  	
   

  	
  N.A.

  
	
  318(a)

  	
   

  	
  N.A.

  

 

N.A. means not
applicable.

*      This Cross-Reference Table is not part of
the Indenture.

 vi

 

INDENTURE

INDENTURE dated as of
September 18, 2006 among Corporate Office Properties, L.P., a Delaware limited
partnership (hereinafter called the “Issuer”),
Corporate Office Properties Trust, a Maryland real estate investment trust
(hereinafter called the “Guarantor” or,
in its capacity as general partner of the Issuer, the “General
Partner”), each having its principal office at 671 Columbia Gateway
Drive, Site 300, Columbia, Maryland 21046, and Wells Fargo Bank, National
Association, as trustee hereunder (hereinafter called the “Trustee”).

Each party agrees as
follows for the benefit of the other parties and for the equal and ratable
benefit of the holders of the Issuer’s 3.50% Exchangeable Senior Notes due 2026
(hereinafter called the Notes) guaranteed by the Guarantor.

ARTICLE 1

DEFINITIONS

Section 1.01.                             Definitions.  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 that are defined in the Trust Indenture Act
(as defined below) or which are by reference therein defined in the Securities
Act (as defined below) (except as herein otherwise expressly provided or unless
the context otherwise requires) shall have the respective meanings assigned to
such terms in the Trust Indenture Act and in the Securities Act as in force at
the date of the execution of this Indenture. The words “herein,”
“hereof,” “hereunder”
and words of similar import refer to this Indenture as a whole and not to any
particular Article, Section or other Subdivision. The terms defined in this
Article include the plural as well as the singular.

“Additional
Interest” shall have the meaning specified for Registration Default
Damages in Section 7 of the Registration Rights Agreement (as defined below).

“Additional
Interest Notice” shall have the meaning specified in Section 4.09.

“Additional Notes”
shall have the meaning specified in Section 2.01.

“Additional
Fundamental Change Shares” shall have the meaning specified in
Section 13.11(a).

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

“Agent
Members” shall have the meaning specified in Section 2.05(b)(v).

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

“Benefited
Party” shall have the meaning specified in Section 15.01.

 

“Board of
Trustees” means the board of trustees of the General Partner or a
committee of such board duly authorized to act for it hereunder.

“Business Day”
means each Monday, Tuesday, Wednesday, Thursday and Friday, other than a day on
which banking institutions in The City of New York or in the city in which the
Corporate Trust Office or Paying Agent are located are authorized or obligated
by law or executive order to close.

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

“Cash
Percentage” shall have the meaning specified in Section 13.02(l).

“Cash
Percentage Notice” shall have the meaning specified in Section
13.02(l).

“Change of Control” means the occurrence at such time after
the original issuance of the Notes when any of the following has occurred:

(i)                                     a “person” or “group” within the meaning
of Section 13(d)(3) of the Exchange Act, files a Schedule TO or any schedule,
form or report under the Exchange Act disclosing that such person or group has
become the direct or indirect “beneficial owner,” as defined in Rule 13d-3
under the Exchange Act, of shares of Common Shares representing more than 50%
of the Voting Stock; or

(ii)                                  the first day on which a majority of the
members of the Board of Trustees does not consist of Continuing Trustees; or

(iii)                               a consolidation, merger or binding share
exchange, or any conveyance, transfer, sale, lease or other disposition of all
or substantially all of the Guarantor’s properties and assets to another
Person, other than:

(a)                                  any transaction (i) that does not result
in any reclassification, conversion, exchange or cancellation of Common Shares
and (ii) under which holders of the Guarantor’s Capital Stock immediately prior
to such transaction have the entitlement to exercise, directly or indirectly,
50% or more of the total Voting Stock of the continuing or surviving or
successor Person immediately after giving effect to such issuance; or

(b)                                 any merger, share exchange, transfer of
assets or similar transaction solely for the purpose of changing the Guarantor’s
jurisdiction of incorporation and resulting in a reclassification, conversion
or exchange of outstanding Common Shares, if at all, solely into shares of
beneficial interest, ordinary shares or American Depositary Shares of the
surviving entity or a direct or indirect parent of the surviving corporation;
or

(c)                                  any consolidation, merger, conveyance,
transfer, lease or other disposition with or into a Subsidiary, so long as such
merger, consolidation, conveyance, transfer, lease or other disposition is not
part of a plan or a series of transactions designed to or having the effect of
merging, consolidating with, or conveying, transferring, selling, leasing or
otherwise disposing of all or substantially all the Guarantor’s properties and
assets to, any other Person.

 2
 

 

The term “Person” includes any syndicate or group that would be
deemed to be a “person” under Section 13(d)(3) of the Exchange Act.

“Commission”
means the Securities and Exchange Commission, as from time to time constituted,
created under the Exchange Act, or, if at any time after the execution of this
Indenture such Commission is not existing and performing the duties now
assigned to it under the Trust Indenture Act, then the body performing such
duties at such time.

“Common
Shares” means, subject to Section 13.05, the common shares of
beneficial interest of the Guarantor, par value $0.01 per share, at the date of
this Indenture or shares of any class or classes resulting from any
reclassification or reclassifications thereof and that have no preference in
respect of dividends or of amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Guarantor and that
are not subject to redemption by the Guarantor; provided that if at any time
there shall be more than one such resulting class, the shares of each such
class then so issuable shall be substantially in the proportion which the total
number of shares of such class resulting from all such reclassifications bears
to the total number of shares of all such classes resulting from all such
reclassifications.

“Common Units”
means the common limited partnership units of the Issuer.

“Continuing Trustee” means a trustee who either was a member
of the Board of Trustees on the original issue date of the Notes or who becomes
a member of the Board of Trustees after that date and whose appointment,
election or nomination for election by the Guarantor’s shareholders is duly
approved by a majority of the Continuing Trustees on the Board of Trustees at
the time of such approval, either by specific vote or by approval of the proxy
statement issued by the Guarantor on behalf of the Board of Trustees in which
such individual is named as nominee for trustee.

“Corporate
Trust Office” or other similar term, means the designated office of
the Trustee at which, at any particular time, its corporate trust business as
it relates to this Indenture shall be administered, which office is, at the
date as of which this Indenture is dated, located at Wells Fargo Bank, National
Association, 608 2nd Avenue South, MAC N9303-120, Minneapolis, MN
55479, Attention: Corporate Trust Services, or at any other time at such other
address as the Trustee may designate from time to time by notice to the Issuer.

“CUSIP”
means the Committee on Uniform Securities Identification Procedures.

“Custodian”
means Wells Fargo Bank, National Association, as custodian with respect to the
Notes in global form, or any successor entity thereto.

“Daily
Exchange Value” means, for each of the 20 consecutive Trading Days
during the Observation Period, 0.05 times the product of (a) the applicable
Exchange Rate and (b) the Last Reported Sale Price of the Common Shares (or the
Reference Property, if applicable) on such day.

“Daily
Settlement Amount,” for each of the 20 Trading Days during the
Observation Period, shall consist of:

(i)                                     cash in an amount equal to the lower of
$50 and the Daily Exchange Value relating to such day); and

 3
 

 

(ii)                                  to the extent the Daily Exchange Value
exceeds $50, a number of Common Shares equal to the Daily Share Amount for such
Trading Day, subject to the Issuer’s right to deliver cash in lieu of all or a portion
of such Common Shares in accordance with Section 13.02(l) and subject to
7.02(m).

“Daily Share
Amount” shall mean, with respect to a Trading Day, an amount equal
to the following: (i) if the Daily Exchange Value for such Trading Day is equal
to or less than $50, then the Daily Share Amount with respect to such Trading
Day shall mean an amount equal to zero; and (ii) if the Daily Exchange Value
for such Trading Day exceeds $50, then the Daily Share Amount with respect to
such Trading Day shall mean a fraction (a) whose numerator is the excess of
such Daily Exchange Value over $50 and (b) whose denominator is the Last
Reported Sale Price per Common Share (or Reference Property, if applicable) on
such Trading Day.

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

“Defaulted
Interest” shall have the meaning specified in Section 2.03.

“Depositary”
means the clearing agency registered under the Exchange Act that is designated
to act as the Depositary for the Global Notes. DTC shall be the initial
Depositary, until a successor shall have been appointed and become such
pursuant to the applicable provisions of this Indenture, and thereafter, “Depositary” shall mean or include such successor.

“Distributed
Property” shall have the meaning specified in Section 13.03(c).

“Dividend
Threshold Amount” shall have the meaning specified in Section
13.03(d).

“DTC”
means The Depository Trust Company.

“Effective
Date” shall have the meaning specified in Section 13.01(g)(ii).

“Event of
Default” means any event specified in Section 6.01 as an Event of
Default.

“Ex Dividend
Date” means, (a) with respect to Section 13.01(e), the first date
upon which a sale of a Common Share does not automatically transfer the right
to receive the relevant dividend from the seller of the Common Shares to its
buyer, and (b) in all other cases, with respect to any issuance or distribution
on the Common Shares or any other equity security, the first date on which the
Common Shares or such other equity security trade on the applicable exchange or
in the applicable market, regular way, without the right to receive such
issuance or distribution.

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

“Exchange
Agent” means the exchange agent appointed by the Issuer to act as
set forth in Article 13, which, initially, shall be the Trustee.

“Exchange
Date” shall have the meaning specified in Section 13.02(c).

“Exchange
Notice” shall have the meaning specified in Section 13.02.

“Exchange
Obligation” shall have the meaning specified in Section 13.01(a).

“Exchange
Price” means as of any date $1,000 divided by the Exchange Rate as
of such date.

 4
 

 

“Exchange
Rate” shall have the meaning specified in Section 13.01(a).

“Exchange
Trigger Price” shall have the meaning specified in Section 13.01(c).

“Fundamental
Change”  means either a Change
of Control or a Termination of Trading.

“Fundamental
Change Issuer Notice” shall have the meaning specified in Section
3.06(b).

“Fundamental
Change Repurchase Date” shall have the meaning specified in Section
3.06(a).

“Fundamental
Change Repurchase Notice” shall have the meaning specified in
Section 3.06(a)(i).

“Fundamental
Change Repurchase Price” shall have the meaning specified in Section
3.06(a).

“Interest
Payment Date” means March 15 and September 15 of each year,
beginning on March 15, 2007.

“General
Partner” means the corporation named as the “General
Partner” in the first paragraph of this Indenture, and, subject to
the provisions of Article 10, shall include its successors and assigns.

“Global Note”
shall have the meaning specified in Section 2.02.

“Guarantee”
means the full and unconditional guarantee provided by the Guarantor in respect
of the Notes as made applicable to the Notes in accordance with the provisions
of Section 15.01 hereof.

“Guarantee
Obligations” shall have the meaning specified in Section 15.01.

“Guarantor”
means the corporation named as the “Guarantor” in
the first paragraph of this Indenture, and, subject to the provisions of
Article 10, shall include its successors and assigns.

“Indenture”
means this instrument as originally executed or, if amended or supplemented as
herein provided, as so amended or supplemented. “Initial Notes” shall have the
meaning specified in Section 2.01.

“Initial
Purchasers” means each of Banc of Americas Securities LLC, J.P.
Morgan Securities Inc. and Wachovia Capital Markets, LLC (each, an “Initial Purchaser”).

“interest”
means, when used with reference to the Notes, any interest payable under the
terms of the Notes, including Additional Interest, if any, payable under the
terms of the Registration Rights Agreement.

“Issuer”
means the limited partnership named as the “Issuer”
in the first paragraph of this Indenture, and, subject to the provisions of
Article 10, shall include its successors and assigns.

“Issuer Put
Right Notice” shall have the meaning specified in Section 3.05(c).

“Issuer Put
Right Notice Date” shall have the meaning specified in Section
3.05(c).

“Issuer
Repurchase Notice” shall have the meaning specified in Section
3.07(b).

 5
 

 

“Last
Reported Sale Price” means, with respect to the Common Shares or any
other security for which a Last Reported Sale Price must be determined, on any
date, the closing sale price per share of the Common Shares or unit of such
other security (or, if no closing sale price is reported, the average of the
last bid and last ask prices or, if more than one in either case, the average
of the average last bid and the average last ask prices) on such date as
reported in composite transactions for the principal U.S. securities exchange
on which the Common Shares or such other security is traded or quoted or, if
the Common Shares or such other security are not listed or quoted on a U.S.
national or regional securities exchange. 
If the Common Shares or such other security are not listed for trading
on a United States national or regional securities exchange or quoted on the
relevant date, the Last Reported Sale Price shall be the last quoted bid price
per Common Share or such other security in the over the counter market on the
relevant date, as reported by the National Quotation Bureau or similar
organization.  If the Common Shares or
such other security is not so quoted, the Last Reported Sale Price shall be the
average of the mid point of the last bid and ask prices for the Common Shares
or such other security on the relevant date from each of at least three
nationally recognized independent investment banking firms selected from time
to time by the Board of Trustees for that purpose.  The Last Reported Sale Price shall be
determined without reference to extended or after hours trading.

“Market
Disruption Event” means the occurrence or existence for more than a
one half hour period in the aggregate on any scheduled Trading Day for the
Common Shares of any suspension or limitation imposed on trading (by reason of
movements in price exceeding limits permitted by the applicable stock exchange
or otherwise) in the Common Shares or in any options, contracts or future
contracts relating to the Common Shares, and such suspension or limitation
occurs or exists at any time before 1:00 p.m. (New York City time) on such day.

“Maturity
Date” means September 15, 2026, unless the Notes are earlier
repurchased, exchanged or redeemed.

“Measurement
Period” shall have the meaning specified in Section 13.01(b).

“Merger Event”
shall have the meaning specified in Section 13.05.

“Notice of
Exchange” shall have the meaning specified in Section 13.02(c).

“Note”
or “Notes” means any Note or Notes, as the
case may be, authenticated and delivered under this Indenture, including the
Initial Notes, any Additional Notes and any Global Note.

“Note
Register” shall have the meaning specified in Section 2.05(a).

“Note
Registrar” shall have the meaning specified in Section 2.05(a).

“Noteholder”
or “Holder” as applied to any Note, or
other similar terms (but excluding the term “beneficial
holder”), means any Person in whose name at the time a particular
Note is registered on the Note Registrar’s books.

“Observation
Period” means the 20 consecutive Trading Day period beginning on and
including the second Trading Day after the related Exchange Date in respect of
such Note.

“Offering
Memorandum” means the Issuer’s and the Guarantor’s offering
memorandum dated September 12, 2006 relating to the Notes unconditionally
guaranteed by the Guarantor.

 6
 

 

“Officer”
means any person holding any of the following positions with the General
Partner: the Chairman of the Board, the Chief Executive Officer, the President,
any Vice President (whether or not designated by a number or numbers or word or
words added before or after the title “Vice President”),
the Chief Financial Officer, the Treasurer and the Secretary.

“Officers’
Certificate,” when used with respect to the Issuer, means a
certificate signed by any two Officers or by one such Officer and any Assistant
Treasurer or Assistant Secretary of the General Partner.

“Opinion of
Counsel” means an opinion in writing signed by legal counsel, who
may be an employee of or counsel to the Issuer, or other counsel reasonably
acceptable to the Trustee.

“outstanding”,
when used with reference to Notes and subject to the provisions of Section
8.04, means, as of any particular time, all Notes authenticated and delivered
by the Trustee under this Indenture, except:

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

(b)                                 Notes, or portions thereof, (i) for the
redemption or repurchase of which monies in the necessary amount shall have
been deposited in trust with the Trustee or with any Paying Agent (other than
the Issuer or the Guarantor) or (ii) which shall have been otherwise discharged
in accordance with Article 11;

(c)                                  Notes in lieu of which, or in
substitution for which, other Notes shall have been authenticated and delivered
pursuant to the terms of Section 2.06; and

(d)                                 Notes exchanged pursuant to Article 13,
and Notes paid or redeemed or repurchased pursuant to Article 3.

“Paying Agent”
shall have the meaning specified in Section 2.08.

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

“PORTAL
Market” means The PORTAL Market operated by the Nasdaq Stock Market
or any successor thereto.

“Predecessor
Note” of any particular Note means every previous Note evidencing
all or a portion of the same debt as that evidenced by such particular Note,
and, for the purposes of this definition, any Note authenticated and delivered
under Section 2.06 lieu of a lost, destroyed or stolen Note shall be deemed to
evidence the same debt as the lost, destroyed or stolen Note that it replaces.

“premium”
means any premium payable under the terms of the Notes.

“Purchase
Agreement” means the Purchase Agreement, dated as of September 12,
2006, among the Issuer, the Guarantor and the Initial Purchasers.

“Put Right
Repurchase Date” shall have the meaning assigned to it in Section
3.05(b).

“Put Right
Repurchase Notice” shall have the meaning assigned to it in Section
3.05(b)(i).

 7
 

 

“Put Right
Repurchase Price” shall have the meaning assigned to it in Section
3.05(b).

“Record Date,”
with respect to the payment of interest on any Interest Payment Date, shall
have the meaning specified in Section 2.03, and with respect to Section 13.04,
shall have the meaning specified in Section 13.04(f).

“Redemption
Date” means, with respect to any Note or portion thereof to be
redeemed in accordance with the provisions of Section 3.01 hereof, the date
fixed for such redemption in accordance with the provisions of Section 3.01
hereof.

“Redemption
Price” has the meaning provided in Section 3.01 hereof.

“Reference
Property” shall have the meaning specified in Section 13.05(b).

“Registration
Rights Agreement” means the Registration Rights Agreement, dated as
of September 18, 2006, among the Issuer, the Guarantor and the Initial
Purchasers, as amended from time to time in accordance with its terms.

“Responsible
Officer” shall mean, when used with respect to the Trustee, any
officer within the corporate trust department of the Trustee with direct
responsibility for the administration of this Indenture and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of such person’s knowledge of or familiarity with
the particular subject.

“Restricted
Securities” shall have the meaning specified in Section 2.05(c).

“Rule 144A”
means Rule 144A as promulgated under the Securities Act as it may be amended
from time to time hereafter.

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

“Stated
Maturity,” with respect to any Note or any installment of principal
thereof or interest thereon, means the date established by or pursuant to this
Indenture or such Note as the fixed date on which the principal of such Note or
such installment of principal or interest is due and payable.

“Share Price”
means the price paid per Common Share in connection with a Fundamental Change
pursuant to which Additional Shares shall be added to the Exchange Rate as set
forth in Section 13.01(e)(ii), which shall be equal to (i) if holders of Common
Shares receive only cash in such Fundamental Change, the cash amount paid per
Common Share and (ii) in all other cases, the average of the Last Reported Sale
Prices of the Common Shares over the five consecutive Trading Day period ending
on the Trading Day preceding the Effective Date of the Fundamental Change.

“Spin Off”
shall have the meaning specified in Section 13.03(c).

“Subsidiary”
means, with respect to any Person, (i) any corporation, association or other
business entity of which more than 50% of the total voting power of shares of
capital stock or other equity interest entitled (without regard to the
occurrence of any contingency) to vote in the election of trustees, managers or
trustees thereof is at the time owned or controlled, directly or indirectly, by
such Person or one or more of the other subsidiaries of that Person (or a
combination thereof) and (ii) any partnership (a) the sole general partner or
managing general partner of which is such Person or a subsidiary of such 

 8
 

 

Person or (b) the only
general partners of which are such Person or of one or more subsidiaries of
such Person (or any combination thereof).

“Termination of Trading” means the occurrence, at any time, of
the Common Shares of the Company (or other securities into which the Notes are
then exchangeable) being neither listed for trading nor quoted on a U.S.
national securities exchange.

“Third Party
Financial Institution” shall have the meaning specified in Section
13.01(b).

“Trading Day”
means a day during which (i) trading in Common Shares generally occurs, (ii)
there is no Market Disruption Event and (iii) a Last Reported Sale Price for
Common Shares (other than a Last Reported Sale Price referred to in the next to
last sentence of such definition) is available for such day; provided that if
the Common Shares is not admitted for trading or quotation on or by any
exchange, bureau or other organization referred to in the definition of Last
Reported Sale Price (excluding the next to last sentence of that definition),
Trading Date shall mean any Business Day.

“Trading
Price” with respect to the Notes, on any date of determination,
means the average of the secondary market bid quotations obtained by the
Trustee for $2.0 million principal amount of Notes at approximately 3:30 p.m.,
New York City time, on such determination date from three independent
nationally recognized securities dealers selected by the Issuer; provided that
if three such bids cannot reasonably be obtained by the Trustee, but two such
bids are obtained, then the average of the two bids shall be used, and if only
one such bid can reasonably be obtained by the Trustee, that one bid shall be
used.  If the Trustee cannot reasonably
obtain at least one bid for $2.0 million principal amount of Notes from a
nationally recognized securities dealer, then the Trading Price per $1,000
principal amount of Notes will be deemed to be less than 98% of the product of
the Last Reported Sale Price of the Common Shares and the Exchange Rate.

“Trigger
Event” shall have the meaning specified in Section 13.03(c).

“transfer”
shall have the meaning specified in Section 2.05(c).

“Trust
Indenture Act” means the Trust Indenture Act of 1939, as amended, as
it was in force at the date of this Indenture; provided that
if the Trust Indenture Act of 1939 is amended after the date hereof, the term “Trust Indenture Act” shall mean, to the extent required by
such amendment, the Trust Indenture Act of 1939 as so amended.

“Trustee”
means Wells Fargo Bank, National Association, and its successors and any
corporation resulting from or surviving any consolidation or merger to which it
or its successors may be a party and any successor trustee at the time serving
as successor trustee hereunder.

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

 9
 

 

ARTICLE 2

ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND TRANSFER OF
NOTES

Section 2.01.                             Designation
Amount and Issue of Notes. The Notes shall be designated as “3.50% Exchangeable Senior Notes due 2026.” Upon the
execution of this Indenture, and from time to time thereafter, Notes may be
executed by the Issuer and delivered to the Trustee for authentication, and the
Trustee shall thereupon authenticate and deliver Notes upon a written order of
the Issuer, such order signed by two Officers or by an Officer and either an
Assistant Treasurer of the General Partner or any Assistant Secretary of the
General Partner, without any further action by the Issuer hereunder.

The aggregate principal
amount of Notes which may be authenticated and delivered under this Indenture
is unlimited; provided that upon initial
issuance (including any issuance upon exercise of the Initial Purchasers’
option set forth in Section 2(b) of the Purchase Agreement), the aggregate
principal amount of Notes outstanding shall not exceed $200,000,000, except as
provided in Section 2.06. The Issuer may, without the consent of the Holders of
Notes, issue additional Notes (the “Additional Notes”)
from time to time in the future with the same terms and the same CUSIP number
as the Notes originally issued under this Indenture (the “Initial
Notes”) in an unlimited principal amount, provided that
such Additional Notes must be part of the same issue as and fungible with the
Initial Notes for United States federal income tax purposes. The Initial Notes
and any such Additional Notes will constitute a single series of debt
securities, and in circumstances in which this Indenture provides for the
Holders of Notes to vote or take any action, the Holders of Initial Notes and
the Holders of any such Additional Notes will vote or take that action as a
single class.

Section 2.02.                             Form of
Notes.  The Notes, the
Guarantee and the Trustee’s certificate of authentication to be borne by such
Notes shall be substantially in the form set forth in Exhibit A hereto. The
terms and provisions contained in the form of Note attached as Exhibit A hereto
shall constitute, and are hereby expressly made, a part of this Indenture and,
to the extent applicable, the Issuer and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and to
be bound thereby.

Any of the Notes may have
such letters, numbers or other marks of identification and such notations,
legends, endorsements or changes as the officers executing the same may approve
(execution thereof to be conclusive evidence of such approval) and as are not
inconsistent with the provisions of this Indenture, or as may be required by
the Custodian, the Depositary or by the National Association of Securities
Dealers, Inc. in order for the Notes to be tradable on The PORTAL Market or as may
be required for the Notes to be tradable on any other market developed for
trading of securities pursuant to Rule 144A or as may be required to comply
with any applicable law or with any rule or regulation made pursuant thereto or
with any rule or regulation of any securities exchange or automated quotation
system on which the Notes may be listed, or to conform to usage, or to indicate
any special limitations or restrictions to which any particular Notes are
subject.

So long as the Notes are
eligible for book-entry settlement with the Depositary, or unless otherwise
required by law, or otherwise contemplated by Section 2.05(b), all of the Notes
will be represented by one or more Notes in global form registered in the name
of the Depositary or the nominee of the Depositary (a “Global Note”).
The transfer and exchange of beneficial interests in any such Global Note shall
be effected through the Depositary in accordance with this Indenture and the
applicable procedures of the Depositary. Except as provided in Section 2.05(b),
beneficial owners of a Global Note shall not be entitled to have certificates
registered in their names, will not receive or be entitled to receive physical
delivery of certificates in definitive form and will not be considered Holders
of such Global Note.

 10
 

 

Any Global Note shall
represent such of the outstanding Notes as shall be specified therein and shall
provide that it shall represent the aggregate amount of outstanding Notes from
time to time endorsed thereon and that the aggregate amount of outstanding
Notes represented thereby may from time to time be increased or reduced to
reflect redemptions, repurchases, exchanges, or transfers permitted hereby. Any
endorsement of a Global Note to reflect the amount of any increase or decrease
in the amount of outstanding Notes represented thereby shall be made by the
Note Registrar or the Custodian, at the direction of the Trustee, in such
manner and upon instructions given by the Holder of such Notes in accordance
with this Indenture. Payment of principal of, interest on and premium, if any,
on any Global Note shall be made to the Holder of such Note.

Section 2.03.                             Date and
Denomination of Notes; Payments of Interest.  The Notes shall be issuable in registered
form without coupons in denominations of $1,000 principal amount and integral
multiples thereof. Each Note shall be dated the date of its authentication and
shall bear interest from the date specified on the face of the form of Note
attached as Exhibit A hereto. Interest on the Notes shall be computed on the
basis of a 360-day year consisting of twelve 30-day months.

The Person in whose name
any Note (or its Predecessor Note) is registered on the Note Register at 5:00
p.m., New York City time, on any Record Date with respect to any interest payment
date shall be entitled to receive the interest payable on such interest payment
date. Notwithstanding the foregoing, any Note or portion thereof surrendered
for exchange during the period from 5:00 p.m., New York City time, on the
Record Date for any interest payment date to 5:00 p.m., New York City time, on
the applicable interest payment date must be accompanied by payment, in
immediately available funds or other funds acceptable to the Issuer, of an
amount equal to the interest otherwise payable on such interest payment date on
the principal amount being exchanged; provided, however, that
no such payment need be made (1) if a Holder exchanges its Notes in connection
with a redemption and the Issuer has specified a Redemption Date that is after
a Record Date and on or prior to the Business Day immediately succeeding such
interest payment date, (2) if a Holder exchanges its Notes in connection with a
Fundamental Change and the Issuer has specified a Fundamental Change Repurchase
Date that is after a Record Date and on or prior to such interest payment date
or (3) to the extent of any overdue interest, if any overdue interest exists at
the time of exchange with respect to such Note. Interest shall be payable at
the office of the Issuer maintained by the Issuer for such purposes, which
shall initially be an office or agency of the Trustee. The Issuer shall pay
interest (i) on any Notes in certificated form by check mailed to the address
of the Person entitled thereto as it appears in the Note Register; provided, however, that a Holder of any Notes in
certificated form in the aggregate principal amount of more than $5.0 million
may specify by written notice to the Issuer that it pay interest by wire
transfer of immediately available funds to the account specified by the
Noteholder in such notice, or (ii) on any Global Note by wire transfer of
immediately available funds to the account of the Depositary or its nominee. If
a payment date is not a Business Day, payment shall be made on the next
succeeding Business Day, and no additional interest shall accrue thereon. The
term “Record Date” with respect to any
interest payment date shall mean the September 1 or March 1 preceding the
applicable September 15 or March 15 interest payment date, respectively.

Any interest on any Note
which is payable, but is not punctually paid or duly provided for, on any
September 15 or March 15 (herein called “Defaulted Interest”)
shall forthwith cease to be payable to the Noteholder registered as such on the
relevant Record Date, and such Defaulted Interest shall be paid by the Issuer,
at its election in each case, as provided in clause (a) or (b) below:

(a)                                  The Issuer
may elect to make payment of any Defaulted Interest to the Persons in whose
names the Notes (or their respective Predecessor Notes) are registered at 5:00
p.m., New York City time, on a special record date for the payment of such
Defaulted Interest, which shall be fixed in the following manner. The Issuer
shall notify the Trustee in writing of the amount of Defaulted Interest
proposed to be 

 11
 

 

paid on
each Note and the date of the proposed payment (which shall be not less than
twenty-five (25) calendar days after the receipt by the Trustee of such notice,
unless the Trustee shall consent to an earlier date), and at the same time the
Issuer shall deposit with the Trustee an amount of money equal to the aggregate
amount to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit on or prior to the
date of the proposed payment, such money when deposited to be held in trust for
the benefit of the Persons entitled to such Defaulted Interest as in this
clause provided. Thereupon the Trustee shall fix a special record date for the
payment of such Defaulted Interest which shall be not more than fifteen (15)
calendar days and not less than ten (10) calendar days prior to the date of the
proposed payment, and not less than ten (10) calendar days after the receipt by
the Trustee of the notice of the proposed payment (unless, the Trustee shall
consent to an earlier date). The Trustee shall promptly notify the Issuer of
such special record date and, in the name and at the expense of the Issuer,
shall cause notice of the proposed payment of such Defaulted Interest and the
special record date therefor to be mailed, first-class postage prepaid, to each
Holder at its address as it appears in the Note Register, not less than ten
(10) calendar days prior to such special record date (unless, the Trustee shall
consent to an earlier date). Notice of the proposed payment of such Defaulted
Interest and the special record date therefor having been so mailed, such
Defaulted Interest shall be paid to the Persons in whose names the Notes (or
their respective Predecessor Notes) are registered at 5:00 p.m., New York City
time, on such special record date and shall no longer be payable pursuant to
the following clause (b) of this Section 2.03.

(b)                                 The Issuer
may make payment of any Defaulted Interest in any other lawful manner not
inconsistent with the requirements of any securities exchange or automated
quotation system on which the Notes may be listed or designated for issuance,
and upon such notice as may be required by such exchange or automated quotation
system, if, after notice given by the Issuer to the Trustee of the proposed
payment pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.

Section 2.04.                             Execution of
Notes.  The Notes shall be
signed in the name and on behalf of the Issuer by the manual or facsimile
signature of an Officer. Only such Notes as shall bear thereon a certificate of
authentication substantially in the form set forth on the form of Note attached
as Exhibit A hereto, executed manually by the Trustee (or an authenticating
agent appointed by the Trustee as provided by Section 16.11), shall be entitled
to the benefits of this Indenture or be valid or obligatory for any purpose.
Such certificate by the Trustee (or such an authenticating agent) upon any Note
executed by the Issuer shall be conclusive evidence that the Note 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 who
shall have signed any of the Notes shall cease to be such Officer before the
Notes so signed shall have been authenticated and delivered by the Trustee, or
disposed of by the Issuer, such Notes nevertheless may be authenticated and
delivered or disposed of as though the person who signed such Notes had not
ceased to be such Officer, and any Note may be signed on behalf of the Issuer
by such persons as, at the actual date of the execution of such Note, shall be
the proper Officers, although at the date of the execution of such Note any
such person was not such an Officer.

Section 2.05.                             Exchange and
Registration of Transfer of Notes; Restrictions on Transfer.  (a) The Issuer shall cause to be kept at
the Corporate Trust Office a register (the register maintained in such office
and in any other office or agency of the Issuer designated pursuant to Section
4.02 being herein sometimes collectively referred to as the “Note Register”) in which, subject to such reasonable
regulations as it may prescribe, the Issuer shall provide for the registration
of Notes and of transfers of Notes. The Note Register shall be in written form
or in any form capable of being exchanged into written form within a reasonably
prompt period of time. The Trustee is hereby appointed “Note
Registrar” for the purpose of registering Notes and transfers of
Notes as herein provided. The Issuer may appoint one or more co-registrars in
accordance with Section 4.02.

 12
 

 

Upon surrender for
registration of transfer of any Note to the Note Registrar or any co-registrar,
and satisfaction of the requirements for such transfer set forth in this
Section 2.05, the Issuer shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Notes of any authorized denominations and of a like aggregate principal
amount and bearing such restrictive legends as may be required by this
Indenture.

Notes may be exchanged
for other Notes of any authorized denominations and of a like aggregate
principal amount, upon surrender of the Notes to be exchanged at any such office
or agency maintained by the Issuer pursuant to Section 4.02. Whenever any Notes
are so surrendered for exchange, the Issuer shall execute, and the Trustee
shall authenticate and deliver, the Notes which the Noteholder making the
exchange is entitled to receive bearing registration numbers not
contemporaneously outstanding.

All Notes issued upon any
registration of transfer or exchange of Notes shall be the valid obligations of
the Issuer, evidencing the same debt, and entitled to the same benefits under
this Indenture, as the Notes surrendered upon such registration of transfer or
exchange.

All Notes presented or
surrendered for registration of transfer or for exchange, redemption, or
repurchase shall (if so required by the Issuer or the Note Registrar) be duly
endorsed, or be accompanied by a written instrument or instruments of transfer
in form satisfactory to the Issuer, and the Notes shall be duly executed by the
Noteholder thereof or its attorney duly authorized in writing.

No service charge shall
be made to any Holder for any registration of, transfer or exchange of Notes,
but the Issuer may require payment by the Holder of a sum sufficient to cover
any tax, assessment or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Notes.

In the event of any
redemption in part, the Issuer shall not be required to: (i) issue or register
the transfer or exchange of any Note during a period beginning at the opening
of business 15 days before any selection of Notes for redemption and ending at
the close of business on the earliest date on which the relevant notice of
redemption is deemed to have been given to all Holders of Notes to be so
redeemed, or (ii) register the transfer or exchange of any Note so selected for
redemption, in whole or in part, except the unredeemed portion of any Note
being redeemed in part.

(a)                                  The
following provisions shall apply only to Global Notes:

(i)                                     Each Global
Note authenticated under this Indenture shall be registered in the name of the
Depositary or a nominee thereof and delivered to such Depositary or a nominee
thereof or Custodian therefor, and each such Global Note shall constitute a
single Note for all purposes of this Indenture.

(ii)                                  Notwithstanding
any other provision in this Indenture, no Global Note may be exchanged in whole
or in part for Notes registered, and no transfer of a Global Note in whole or
in part may be registered, in the name of any Person other than the Depositary
or a nominee thereof unless (1) the Depositary (x) has notified the Issuer that
it is unwilling or unable to continue as Depositary for such Global Note or (y)
has ceased to be a clearing agency registered under the Exchange Act, and a
successor depositary has not been appointed by the Issuer within ninety (90)
calendar days, (2) an Event of Default has occurred and is continuing or (3)
the Issuer, in its sole discretion, notifies the Trustee in writing that it no
longer wishes to have all the Notes represented by Global Notes. Any Global
Note exchanged pursuant to clause (1) or (2) above shall be so exchanged in
whole and not in part and any Global Note exchanged pursuant to clause (3)
above may be exchanged in whole or from time to time in part as directed by the
Issuer. Any 

 13
 

 

Note issued in exchange for a Global Note or any portion
thereof shall be a Global Note; provided that
any such Note so issued that is registered in the name of a Person other than
the Depositary or a nominee thereof shall not be a Global Note.

(iii)                               Notes issued
in exchange for a Global Note or any portion thereof pursuant to clause (ii)
above shall be issued in definitive, fully registered form, without interest
coupons, shall have an aggregate principal amount equal to that of such Global
Note or portion thereof to be so exchanged, shall be registered in such names
and be in such authorized denominations as the Depositary shall designate and
shall bear any legends required hereunder. Any Global Note to be exchanged in
whole shall be surrendered by the Depositary to the Trustee, as Note Registrar.
With regard to any Global Note to be exchanged in part, either such Global Note
shall be so surrendered for exchange or, if the Trustee is acting as Custodian
for the Depositary or its nominee with respect to such Global Note, the
principal amount thereof shall be reduced, by an amount equal to the portion
thereof to be so exchanged, by means of an appropriate adjustment made on the
records of the Trustee. Upon any such surrender or adjustment, the Trustee
shall authenticate and make available for delivery the Note issuable on such
exchange to or upon the written order of the Depositary or an authorized
representative thereof.

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

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

(vi)                              At such time
as all interests in a Global Note have been redeemed, repurchased, exchanged,
or canceled for Notes in certificated form, such Global Note shall, upon
receipt thereof, be canceled by the Trustee in accordance with standing
procedures and instructions existing between the Depositary and the Custodian.
At any time prior to such cancellation, if any interest in a Global Note is
redeemed, repurchased, exchanged, or canceled for Notes in certificated form,
the principal amount of such Global Note shall, in accordance with the standing
procedures and instructions existing between the Depositary and the Custodian,
be appropriately reduced, and an endorsement shall be made on such Global Note,
by the Note Registrar or the Custodian, at the direction of the Trustee, to
reflect such reduction.

(b)                                 Every Note
(and all securities issued in exchange therefor or in substitution thereof)
that bears or is required under this Section 2.05(c) to bear the legend set
forth in this Section 2.05(c) (the “Restricted Notes Legend”),
and any Common Shares that bears or is required under this Section 2.05(c) to
bear the Common Shares legend set forth in this Section 2.05(c) (the “Common shares Legend”) (collectively, the “Restricted Securities”) shall be subject to the restrictions
on transfer set forth in this Section 2.05(c) (including those set forth in the
legends below) unless such restrictions on transfer shall be waived by written
consent of the Issuer, and the Holder of each such Restricted Security, by such
Note

 14
 

 

Holder’s
acceptance thereof, agrees to be bound by all such restrictions on transfer. As
used in this Section 2.05(c), the term “transfer” means
any sale, pledge, loan, transfer or other disposition whatsoever of any
Restricted Security or any interest therein.

Until the Maturity Date
for the Notes any certificate evidencing a Restricted Security shall bear a
legend in substantially the following form, or unless otherwise agreed by the
Issuer in writing, with written notice thereof to the Trustee:

NEITHER THIS SECURITY NOR THE
COMMON SHARES OF BENEFICIAL INTEREST ISSUABLE ON EXCHANGE OF THIS SECURITY HAVE
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS
SECURITY NOR THE COMMON SHARES OF BENEFICIAL INTEREST ISSUABLE ON EXCHANGE OF
THIS SECURITY, NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY,
BY ITS ACCEPTANCE HEREOF, (1) REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL
BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”)); (2)
AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS
PURCHASED SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY OR ANY
COMMON SHARES OF BENEFICIAL INTEREST ISSUABLE ON EXCHANGE OF THIS SECURITY,
PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THIS
SECURITY UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR
PROVISION), ONLY (A) TO CORPORATE OFFICE PROPERTIES, L.P. (THE “ISSUER”), (B)
UNDER A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT (AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER),
(C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE UNDER RULE 144A, IN
COMPLIANCE WITH RULE 144A TO A PERSON IT REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A OR (D) UNDER ANOTHER AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER’S
AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER UNDER CLAUSE
(D) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR
OTHER INFORMATION SATISFACTORY TO EACH OF THEM; AND (3) AGREES THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

THIS LEGEND WILL BE REMOVED ON
THE EARLIER OF THE TRANSFER OF THIS SECURITY UNDER CLAUSE 2(B) ABOVE OR ON ANY
TRANSFER OF THIS SECURITY UNDER RULE 144 UNDER THE SECURITIES ACT (OR ANY
SUCCESSOR PROVISION).

 15

 

Until the expiration of
the holding period applicable to sales thereof under Rule 144(k) under the
Securities Act (or any successor provision), any certificate evidencing any
stock certificate representing Common Shares issued upon exchange of any Note, shall
bear a Common Shares Legend unless such Common Shares has been sold pursuant to
a registration statement that has been declared effective under the Securities
Act (and which continues to be effective at the time of such transfer) or
pursuant to Rule 144 under the Securities Act or any similar provision then in
force, or unless otherwise agreed by the Issuer in writing, with written notice
thereof to the Trustee:

THIS SECURITY HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS
SECURITY, NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED,
SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN
THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR
NOT SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS
ACCEPTANCE HEREOF, (1) REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER”
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”)); (2) AGREES ON
ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED
SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE
EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THIS SECURITY UNDER
RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), ONLY (A) TO
CORPORATE OFFICE PROPERTIES, L.P. (THE “ISSUER”), (B) UNDER A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH
CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER), (C) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE UNDER RULE 144A, IN COMPLIANCE WITH RULE
144A TO A PERSON IT REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A OR (D) UNDER ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S
RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER UNDER CLAUSE (D) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM; AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND.

THIS LEGEND WILL BE REMOVED ON
THE EARLIER OF THE TRANSFER OF THIS SECURITY UNDER CLAUSE 2(B) ABOVE OR ON ANY
TRANSFER OF THIS SECURITY UNDER RULE 144 UNDER THE SECURITIES ACT (OR ANY
SUCCESSOR PROVISION).

Any such Common Shares as
to which such restrictions on transfer shall have expired in accordance with
their terms or as to which the conditions for removal of the Common shares
Legend set forth therein have been satisfied may, upon surrender of the
certificates representing such Common Shares for exchange in accordance with
the procedures of the transfer agent for the Common shares, be 

 16
 

 

exchanged for a new
certificate or certificates for a like number of Common Shares, which shall not
bear the Common shares Legend required by this Section 2.05(c).

(c)                                  By its
acceptance of any Note bearing the Restricted Notes Legend, each Holder of such
Note acknowledges the restrictions on transfer of such Note set forth in this
Indenture and in the Restricted Notes Legend and agrees that it will transfer
such Note only as provided in this Indenture and as permitted by applicable
law.

(d)                                 Any
Restricted Securities purchased or owned by the Issuer or any Affiliate thereof
may not be resold by the Issuer or such Affiliate unless registered under the
Securities Act or resold pursuant to an exemption from the registration
requirements of the Securities Act in a transaction which results in such Notes
or Common shares, as the case may be, no longer being “restricted securities”
(as defined under Rule 144).

(e)                                  The Trustee
shall have no responsibility or obligation to any Agent Members or any other
Person with respect to the accuracy of the books or records, or the acts or
omissions, of the Depositary or its nominee or of any participant or member
thereof, with respect to any ownership interest in the Notes or with respect to
the delivery to any Agent Member or other Person (other than the Depositary) of
any notice (including any notice of redemption) or the payment of any amount,
under or with respect to such Notes. All notices and communications to be given
to the Noteholders and all payments to be made to Noteholders under the Notes
shall be given or made only to or upon the order of the registered Noteholders
(which shall be the Depositary or its nominee in the case of a Global Note).
The rights of beneficial owners in any Global Note shall be exercised only
through the Depositary subject to the customary procedures of the Depository. The
Trustee may rely and shall be fully protected in relying upon information
furnished by the Depositary with respect to its Agent Members.

The Trustee shall have no
obligation or duty to monitor, determine or inquire as to compliance with any
restrictions on transfer imposed under this Indenture or under applicable law
with respect to any transfer of any interest in any Note (including any
transfers between or among Agent Members in any Global Indenture) other than to
require delivery of such certificates and other documentation or evidence as
are expressly required by, and to do so if and when expressly required by, the
terms of this Indenture, and to examine the same to determine substantial
compliance as to form with the express requirements hereof.

Section 2.06.                             Mutilated,
Destroyed, Lost or Stolen Notes. 
In case any Note shall become mutilated or be destroyed, lost or stolen,
the Issuer in its discretion may execute, and upon its written request the
Trustee or an authenticating agent appointed by the Trustee shall authenticate
and make available for delivery, a new Note, bearing a number not
contemporaneously outstanding, in exchange and substitution for the mutilated
Note, or in lieu of and in substitution for the Note so destroyed, lost or
stolen. In every case, the applicant for a substituted Note shall furnish to
the Issuer, to the Trustee and, if applicable, to such authenticating agent
such security or indemnity as may be required by them to save each of them
harmless for any loss, liability, cost or expense caused by or connected with
such substitution, and, in every case of destruction, loss or theft, the
applicant shall also furnish to the Issuer, to the Trustee and, if applicable,
to such authenticating agent evidence to their satisfaction of the destruction,
loss or theft of such Note and of the ownership thereof.

Following receipt by the
Trustee or such authenticating agent, as the case may be, of satisfactory
security or indemnity and evidence, as described in the preceding paragraph,
the Trustee or such authenticating agent may authenticate any such substituted
Note and make available for delivery such Note. Upon the issuance of any
substituted Note, the Issuer may require the payment by the Holder of a sum
sufficient to cover any tax, assessment or other governmental charge that may
be imposed in relation 

 17
 

 

thereto and any other
expenses connected therewith. In case any Note which has matured or is about to
mature or has been called for redemption or has been properly tendered for
repurchase on a Fundamental Change Repurchase Date (and not withdrawn) or has
been tendered for repurchase on a Repurchase Date (and not withdrawn), as the
case may be, or is to be exchanged pursuant to this Indenture, shall become
mutilated or be destroyed, lost or stolen, the Issuer may, instead of issuing a
substitute Note, pay or authorize the payment of or exchange or authorize the
exchange of the same (without surrender thereof except in the case of a
mutilated Note), as the case may be, if the applicant for such payment or
exchange shall furnish to the Issuer, to the Trustee and, if applicable, to
such authenticating agent such security or indemnity as may be required by them
to save each of them harmless for any loss, liability, cost or expense caused
by or in connection with such substitution, and, in every case of destruction,
loss or theft, the applicant shall also furnish to the Issuer, the Trustee and,
if applicable, any Paying Agent or Exchange Agent evidence to their
satisfaction of the destruction, loss or theft of such Note and of the
ownership thereof.

Every substitute Note
issued pursuant to the provisions of this Section 2.06 by virtue of the fact
that any Note is destroyed, lost or stolen shall constitute an additional
contractual obligation of the Issuer, whether or not the destroyed, lost or
stolen Note shall be found at any time, and shall be entitled to all the
benefits of (but shall be subject to all the limitations set forth in) this
Indenture equally and proportionately with any and all other Notes duly issued
hereunder. To the extent permitted by law, all Notes shall be held and owned
upon the express condition that the foregoing provisions are exclusive with
respect to the replacement or payment or exchange or redemption or repurchase
of mutilated, destroyed, lost or stolen Notes and shall preclude any and all
other rights or remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement or payment or
exchange or redemption or repurchase of negotiable instruments or other
securities without their surrender.

Section 2.07.                             Temporary
Notes.  Pending the
preparation of Notes in certificated form, the Issuer may execute and the
Trustee or an authenticating agent appointed by the Trustee shall, upon the
written request of the Issuer, authenticate and deliver temporary Notes
(printed or lithographed). Temporary Notes shall be issuable in any authorized
denomination, and substantially in the form of the Notes in certificated form,
but with such omissions, insertions and variations as may be appropriate for
temporary Notes, all as may be determined by the Issuer. Every such temporary
Note shall be executed by the Issuer and authenticated by the Trustee or such
authenticating agent upon the same conditions and in substantially the same
manner, and with the same effect, as the Notes in certificated form. Without
unreasonable delay, the Issuer will execute and deliver to the Trustee or such
authenticating agent Notes in certificated form and thereupon any or all
temporary Notes may be surrendered in exchange therefor, at each office or
agency maintained by the Issuer pursuant to Section 4.02 and the Trustee or
such authenticating agent shall authenticate and make available for delivery in
exchange for such temporary Notes an equal aggregate principal amount of Notes
in certificated form. Such exchange shall be made by the Issuer at its own
expense and without any charge therefor. Until so exchanged, the temporary
Notes shall in all respects be entitled to the same benefits and subject to the
same limitations under this Indenture as Notes in certificated form
authenticated and delivered hereunder.

Section 2.08.                             Cancellation
of Notes.  All Notes
surrendered for the purpose of payment, redemption, repurchase, exchange or
registration of transfer shall, if surrendered to the Issuer or any paying
agent to whom Notes may be presented for payment (the “Paying Agent”)
or Exchange Agent, which shall initially be the Trustee, or any Note Registrar,
be surrendered to the Trustee and promptly canceled by it or, if surrendered to
the Trustee, shall be promptly canceled by it and no Notes shall be issued in
lieu thereof except as expressly permitted by any of the provisions of this
Indenture. The Trustee shall dispose of such canceled Notes in accordance with
its customary procedures. If the Issuer shall acquire any of the Notes, such
acquisition shall not operate as a redemption, repurchase or satisfaction of 

 18
 

 

the
indebtedness represented by such Notes unless and until the same are delivered
to the Trustee for cancellation.

Section 2.09.                             CUSIP
Numbers.  The Issuer in
issuing the Notes may use “CUSIP” numbers
(if then generally in use), and, if so, the Trustee shall use “CUSIP” numbers in notices of redemption as a convenience to
Noteholders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Notes or as contained in any notice of a redemption
and that reliance may be placed only on the other identification numbers
printed on the Notes, and any such redemption shall not be affected by any
defect in or omission of such numbers. The Issuer will promptly notify the
Trustee of any change in the “CUSIP” numbers.

ARTICLE 3

REDEMPTION AND REPURCHASE OF NOTES

Section 3.01.                             Optional
Redemption of Notes. 
(a) The Issuer shall have the right to redeem the Notes for cash,
in whole or in part, (i) prior to September 20, 2011, if the Issuer determines
it is necessary to redeem the Notes in order to preserve the Guarantor’s status
as a real estate investment trust and (ii) at any time or from time to time, on
or after September 20, 2011, in each case upon the notice set forth in Section
3.02 at a redemption price (“Redemption Price”)
equal to 100% of the principal amount of the Notes to be redeemed plus unpaid
interest, if any, accrued thereon to, but excluding, the Redemption Date; provided, however that if
the Redemption Date falls after a Record Date and on or prior to the
corresponding interest payment date, the Issuer will pay the full amount of
accrued and unpaid interest, if any, on such interest payment date to the
Holder of record at the close of business on the corresponding Record Date
(instead of the Holder surrendering its Notes for redemption) and the
Redemption Price shall be equal to 100% of the principal amount of the Notes to
be redeemed. In connection with any redemption by the Issuer pursuant to clause
(i) in this Section 3.01(a), the Issuer shall provide the Trustee with an
Officers’ Certificate evidencing that the Board of Trustees has, in good faith,
made the determination that it is necessary to redeem the Notes in order to
preserve the Guarantor’s status as a real estate investment trust.

(b)                                 The Issuer
shall not redeem the Notes pursuant to Section 3.01(a) until it has made at
least 10 semi-annual interest payments (including the interest payments on
March 15, 2007 through September 15, 2011) in the full amount required by this
Indenture and the Notes.

Section 3.02.                             Notice of
Optional Redemption; Selection of Notes.  In case the Issuer shall desire to exercise
the right to redeem all or, as the case may be, any part of the Notes pursuant
to Section 3.01, it shall fix a date for redemption and it or, at its written
request received by the Trustee not fewer than five (5) Business Days prior (or
such shorter period of time as may be acceptable to the Trustee) to the date
the notice of redemption is to be delivered, the Trustee in the name of and at
the expense of the Issuer, shall deliver or cause to be delivered a notice of
such redemption not fewer than thirty (30) calendar days nor more than sixty
(60) calendar days prior to the Redemption Date to each Holder of Notes so to
be redeemed in whole or in part at its last address as the same appears on the
Note Register; provided that if the Issuer makes
such request of the Trustee, it shall, together with such request, also give
written notice of the Redemption Date to the Trustee, provided
further that the text of the notice shall be prepared by the Issuer.
Such delivering shall be by first class mail or, in the case of book-entry
Notes, by electronic transmission. The notice, if delivered 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 by electronic transmission or any defect in the notice
to the Holder of any Note designated for redemption as a whole or in part shall
not affect the validity of the proceedings for the redemption of any other
Note. Concurrently with the delivering of any such notice of redemption, the 

 19
 

 

Issuer
shall issue a press release announcing such redemption, the form and content of
which press release shall be determined by the Issuer in its sole discretion.
The failure to issue any such press release or any defect therein shall not
affect the validity of the redemption notice or any of the proceedings for the
redemption of any Note called for redemption.

Each such notice of
redemption shall specify: (i) the aggregate principal amount of Notes to be
redeemed, (ii) the CUSIP number or numbers of the Notes being redeemed, (iii)
the Redemption Date (which shall be a Business Day), (iv) the Redemption Price
at which Notes are to be redeemed, (v) the place or places of payment and that
payment will be made upon presentation and surrender of such Notes, (iv) that
interest accrued and unpaid to, but excluding, the Redemption Date will be paid
as specified in said notice, and that on and after said date interest thereon
or on the portion thereof to be redeemed will cease to accrue, (vii) that the
Holder has a right to exchange the Notes called for redemption, (viii) the
Exchange Rate on the date of such notice and (ix) the time and date on which the
right to exchange such Notes or portions thereof pursuant to this Indenture
will expire. If fewer than all the Notes are to be redeemed, the notice of
redemption shall identify the Notes to be redeemed (including CUSIP numbers, if
any). In case any Note 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
Note, a new Note or Notes in principal amount equal to the unredeemed portion
thereof will be issued.

Whenever any Notes are to
be redeemed, the Issuer will give the Trustee written notice of the Redemption
Date, together with an Officers’ Certificate as to the aggregate principal
amount of Notes to be redeemed, not fewer than thirty (30) calendar days (or
such shorter period of time as may be acceptable to the Trustee) prior to the
Redemption Date.

On or prior to the
Redemption Date specified in the notice of redemption given as provided in this
Section 3.02, the Issuer will deposit with the Paying Agent (or, if the Issuer
is acting as its own Paying Agent, set aside, segregate and hold in trust as
provided in Section 4.04) an amount of money in immediately available funds
sufficient to redeem on the Redemption Date all the Notes (or portions thereof)
so called for redemption (other than those theretofore surrendered for
exchange) at the appropriate Redemption Price; provided that
if such payment is made on the Redemption Date, it must be received by the Paying
Agent, by 11:00 a.m., New York City time, on such date. The Issuer shall be
entitled to retain any interest, yield or gain on amounts deposited with the
Paying Agent pursuant to this Section 3.02 in excess of amounts required
hereunder to pay the Redemption Price. If any Note called for redemption is
exchanged pursuant hereto prior to such Redemption Date, any money deposited
with the Paying Agent or so segregated and held in trust for the redemption of
such Note shall be paid to the Issuer or, if then held by the Issuer, shall be
discharged from such trust.

If less than all of the
outstanding Notes are to be redeemed, the Trustee shall select the Notes or
portions thereof of the Global Note or the Notes in certificated form to be
redeemed (in principal amounts of $1,000 or multiples thereof) by lot, on a pro
rata basis or by another method the Trustee deems fair and appropriate (in such
manner as complies with any applicable laws and regulations). If any Note
selected for redemption is submitted for exchange in part after such selection,
the portion of such Note submitted for exchange shall be deemed (so far as may
be possible) to be the portion to be selected for redemption. The Notes (or
portions thereof) so selected for redemption shall be deemed duly selected for
redemption for all purposes hereof, notwithstanding that any such Note is
submitted for exchange in part before the mailing of the notice of redemption.

Upon any redemption of
less than all of the outstanding Notes, the Issuer and the Trustee may (but
need not), solely for purposes of determining the pro rata allocation among
such Notes that are unexchanged and outstanding at the time of redemption,
treat as outstanding any Notes surrendered for 

 20
 

 

exchange during the
period of fifteen (15) calendar days preceding the mailing of a notice of
redemption and may (but need not) treat as outstanding any Note authenticated
and delivered during such period in exchange for the unexchanged portion of any
Note exchanged in part during such period.

Section 3.03.                             Payment of
Notes Called for Redemption by the Issuer.  If notice of redemption has been given as
provided in Section 3.02, the Notes or portion of Notes with respect to which
such notice has been given shall, unless exchanged pursuant to the terms hereof,
become due and payable on the Redemption Date and at the place or places stated
in such notice at the Redemption Price, and unless the Issuer shall default in
the payment of such Notes at the Redemption Price, interest on the Notes or
portion of Notes so called for redemption shall cease to accrue on and after
the Redemption Date and, after 5:00 p.m., New York City time, on the second
Business Day immediately preceding the Redemption Date (unless the Issuer shall
default in the payment of the Redemption Price) such Notes shall cease to be
exchangeable pursuant to this Indenture and, except as provided in Section 7.05
and Section 11.02, to be entitled to any benefit or security under this
Indenture, and the Holders thereof shall have no right in respect of such Notes
except the right to receive the Redemption Price thereof. On presentation and
surrender of such Notes at a place of payment in said notice specified, the
said Notes or the specified portions thereof shall be paid and redeemed by the
Issuer at the Redemption Price, together with interest accrued thereon to, but
excluding, the Redemption Date.

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

Section 3.04.                             Sinking Fund.  There shall be no sinking fund provided for
the Notes.

Section 3.05.     Repurchase
of Notes at Option of the Noteholder on Specified Dates.

(a)          At the
option of the Holder thereof, Notes shall be repurchased by the Issuer in
accordance with the provisions of the Notes on September 15, 2011,
September 15, 2016 or September 15, 2021 (each, a “Put Right Repurchase Date”) at a repurchase price per Note
equal to 100% of the aggregate principal amount of the Notes being repurchased,
together with any accrued and unpaid interest up to, but not including, such
Put Right Repurchase Date (the “Put Right Repurchase Price”).

Repurchases of Notes by
the Issuer pursuant to this Section 3.05 shall be made, at the option of
the Holder thereof, upon:

(i)                                     delivery to
the Trustee (or other Paying Agent appointed by the Issuer) by the Noteholder
of a written notice of purchase (a “Put Right Repurchase
Notice”) in the form set forth on the reverse of the Note at any
time from the opening of business on the date that is 25 Business Days prior to
the applicable Put Right Repurchase Date until the Close of Business on the
fifth Business Day prior to such Put Right Repurchase Date stating:

(A)      if certificated, the certificate
numbers of the Notes to be delivered for repurchase;

(B)        the portion of the principal amount
of the Notes to be repurchased, which must be $1,000 or an integral multiple
thereof; and

 21
 

 

(C)        that the Notes are to be repurchased
as of the applicable Put Right Repurchase Date pursuant to the terms and
conditions specified in the Notes and in this Indenture; and

(ii)                                  delivery of
such Note to the Paying Agent prior to, on or after the Put Right Repurchase
Date (together with all necessary endorsements) at the offices of the Paying
Agent, such delivery being a condition to receipt by the Noteholder of the Put
Right Repurchase Price therefor, which shall be so paid pursuant to this
Section 3.05 only if the Note so delivered to the Paying Agent shall
conform in all respects to the description thereof in the related Put Right
Repurchase Notice, as determined by the Issuer.

The Issuer shall
repurchase from the Holder thereof, pursuant to this Section 3.05, a
portion of a Note if the principal amount of such portion is $1,000 or an
integral multiple of $1,000.  Provisions
of this Indenture that apply to the repurchase of all of a Note also apply to
the repurchase of such portion of such Note.

Any repurchase by the
Issuer contemplated pursuant to the provisions of this Section 3.05 shall
be consummated by the delivery of the consideration to be received by the
Noteholder promptly following the later of the Put Right Repurchase Date and
the time of delivery of the Note.

The Trustee (or other
Paying Agent appointed by the Issuer) shall promptly notify the Issuer of the
receipt by it of any Put Right Repurchase Notice or written notice of withdrawal
thereof in accordance with the provisions of Section 3.05(e).

Any Note that is to be
repurchased only in part shall be surrendered to the Trustee (with, if the
Issuer or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Issuer and the Trustee duly executed by
the Holder thereof or his attorney duly authorized in writing), and the Issuer
shall execute, and the Trustee shall authenticate and make available for
delivery to the Holder of such Note without service charge, a new Note or
Notes, containing identical terms and conditions, each in an authorized
denomination in aggregate principal amount equal to and in exchange for the
unrepurchased portion of the principal of the Note so surrendered.

(b)         In
connection with any purchase of Notes pursuant to this Section 3.05, the
Issuer shall give written notice of the Put Right Repurchase Date to the
Noteholders (the “Issuer Put Right Notice”).

The Issuer Put Right
Notice shall be sent by first-class mail to the Trustee and to each
Noteholder that has delivered a Put Right Repurchase Notice within 10 Business
Days of receipt of such Put Right Notice, or, if a shorter period, at least two
Business Days prior to any Put Right Repurchase Date (the “Issuer Put
Right Notice Date”).  Each
Issuer Put Right Notice shall include a form of Put Right Repurchase Notice to
be completed by a Noteholder and shall state:

(i)                                     the Put
Right Repurchase Price and the Exchange Price;

(ii)                                  the name and
address of the Paying Agent and the Exchange Agent;

(iii)                               that Notes
as to which a Put Right Repurchase Notice has been given may be exchanged in
accordance with Article 7 only if the applicable Put Right Repurchase
Notice has been withdrawn in accordance with the terms of this Indenture;

(iv)                              that Notes
must be surrendered to the Paying Agent to collect payment;

 22
 

 

(v)                                 that the Put
Right Repurchase Price for any Note as to which a Put Right Repurchase Notice
has been given and not withdrawn will be paid promptly following the later of
the Put Right Repurchase Date and the time of surrender of such Note as
described in subclause (iv) above;

(vi)                              the
procedures the Noteholder must follow to exercise rights under this Section
3.05 and a brief description of those rights;

(vii)                           briefly, the
exchange rights of the Notes;

(viii)                        the
procedures for withdrawing a Put Right Repurchase Notice (including pursuant to
the terms of Section 3.05(e));

(ix)                                that, unless
the Issuer defaults in making payment on Notes for which a Put Right Repurchase
Notice has been submitted, interest on the Notes in respect of which a Put
Right Repurchase Notice has been delivered and not withdrawn will cease to
accrue on the Put Right Repurchase Date; and

(x)                                   the CUSIP
number of the Notes.

If any of the Notes are to
be redeemed in the form of a Global Note, the Issuer shall modify such notice
to the extent necessary to accord with the procedures of the Depositary
applicable to redemptions.

At the Issuer’s request,
the Trustee shall give such Issuer Put Right Notice in the Issuer’s name and at
the Issuer’s expense; provided, however, that, in all cases, the text of such Issuer Put
Right Notice shall be prepared by the Issuer.

(c)          Upon receipt
by the Trustee (or other Paying Agent appointed by the Issuer) of the Put Right
Repurchase Notice specified in Section 3.05(b)(i), the Holder of the Note
in respect of which such Put Right Repurchase Notice was given shall (unless
such Put Right Repurchase Notice is withdrawn as specified in Section 3.05(e))
thereafter be entitled to receive solely the Put Right Repurchase Price with
respect to such Note.  Such Put Right
Repurchase Price shall be paid to such Holder, subject to receipt of funds by
the Paying Agent, promptly following the later of (x) the Put Right
Repurchase Date with respect to such Note (provided the conditions in Section
3.05(b) have been satisfied) and (y) the time of delivery of such Note to
the Paying Agent by the Holder thereof in the manner required by Section
3.05(b)(i).  Notes in respect of which a
Put Right Repurchase Notice has been given by the Holder thereof may not be
exchanged pursuant to Article 8 on or after the date of the delivery of
such Put Right Repurchase Notice, unless such Put Right Repurchase Notice has
first been validly withdrawn as specified in Section 3.05(e).

(d)         A Put Right
Repurchase Notice may be withdrawn by means of a written notice of withdrawal
delivered to the office of the Paying Agent in accordance with the Put Right
Repurchase Notice at any time prior to 10:00 a.m. New York City time on
the fourth business on the Business Day prior to the Put Right Repurchase Date
specifying:

(i)                                     if
certificated Notes have been issued, the certificate numbers of the withdrawn
Notes;

(ii)                                  the
principal amount of the Notes with respect to which such notice of withdrawal
is being submitted; and

 23
 

 

(iii)                               the
principal amount, if any, of such Notes that remains subject to the original
Put Right Repurchase Notice, which portion must be in principal amounts of
$1,000 or an integral multiple of $1,000;

provided, however, that
if the Notes are not in certificated form, the notice must comply with
appropriate procedures of the Depositary.

A written notice of
withdrawal of a Put Right Repurchase Notice shall be in the form set forth in
the preceding paragraph.

Upon receipt of a written
notice of withdrawal, the Paying Agent shall promptly return to the Holders
thereof any Notes in respect of which a Put Right Repurchase Notice has been
withdrawn in accordance with the provisions of this Section 3.05(e).

(e)          There shall
be no repurchase of any Notes pursuant to this Section 3.05 if there has
occurred (prior to, on or after, as the case may be, the giving, by the Holders
of such Notes, of the required Put Right Repurchase Notice) and is continuing
an Event of Default with respect to the Notes (other than a default in the
payment of the Put Right Repurchase Price with respect to such Notes).  The Paying Agent will promptly return to the
respective Holders thereof any Notes held by it during the continuance of an Event
of Default with respect to Notes (other than a default in the payment of the
Put Right Repurchase Price with respect to such Notes), in which case, upon
such return, the Put Right Repurchase Notice with respect thereto shall be
deemed to have been withdrawn.

(f)            Prior to
11:00 a.m. (New York City time) on the Put Right Repurchase Date, the
Issuer shall deposit with the Trustee (or other Paying Agent appointed by the
Issuer or if the Issuer is acting as its own Paying Agent, set aside, segregate
and hold in trust in accordance with the terms of the Original Indenture as
modified by this Indenture) an amount (in immediately available funds if
deposited on such Business Day) sufficient to pay the aggregate Put Right
Repurchase Price of all the Notes or portions thereof which are to be purchased
as of the Put Right Repurchase Date.  The
manner in which the deposit required by this Section 3.05(g) is made by the
Issuer shall be at the option of the Issuer; provided
that such deposit shall be made in a manner such that the Trustee or a Paying
Agent shall have immediately available funds on the Put Right Repurchase Date.

If the Trustee (or other
Paying Agent appointed by the Issuer) holds, in accordance with the terms
hereof, money sufficient to pay the Put Right Repurchase Price of any Note,
then, on the Put Right Repurchase Date, such Note will cease to be Outstanding
and the rights of the Holder in respect thereof shall terminate (other than the
right to receive the Put Right Repurchase Price as aforesaid).

To the extent that the
aggregate amount of cash deposited by the Issuer pursuant to this Section
3.05(g) exceeds the aggregate Put Right Repurchase Price of the Notes or
portions thereof that the Issuer is obligated to purchase, then promptly after
the Put Right Repurchase Date the Trustee or a Paying Agent, as the case may
be, shall return any such excess cash to the Issuer.

Section 3.06.     Repurchase
at Option of Noteholders Upon a Fundamental Change.

(a)          If a
Fundamental Change occurs at any time, then each Noteholder shall have the
right, at such Noteholder’s option, to require the Issuer to repurchase all of
such Noteholder’s Notes or any portion thereof that is a multiple of $1,000
principal amount, for cash on the date (the “Fundamental
Change Repurchase Date”) specified by the Issuer that is not less
than 20 Business Days and not more than 35 Business Days after the date of the
Fundamental Change Issuer Notice (as defined below) at a repurchase price equal
to 100% of the principal amount thereof, together with accrued and unpaid
interest 

 24
 

 

thereon to, but
excluding, the Fundamental Change Repurchase Date (the “Fundamental
Change Repurchase Price”).

Repurchases of Notes
under this Section 3.06 shall be made, at the option of the Holder thereof,
upon:

(i)                                     delivery to
the Trustee (or other Paying Agent appointed by the Issuer) by a Noteholder of
a duly completed notice (the “Fundamental Change
Repurchase Notice”) in the form set forth on the reverse of the Note
prior to the Close of Business on the Fundamental Change Repurchase Date; and

(ii)                                  delivery or
book-entry transfer of the Notes to the Trustee (or other Paying Agent
appointed by the Issuer) at any time after delivery of the Fundamental Change
Repurchase Notice (together with all necessary endorsements) at the Corporate
Trust Office of the Trustee (or other Paying Agent appointed by the Issuer),
such delivery being a condition to receipt by the Noteholder of the Fundamental
Change Repurchase Price therefor; provided that
such Fundamental Change Repurchase Price shall be so paid pursuant to this
Section 3.06 only if the Note so delivered to the Trustee (or other Paying
Agent appointed by the Issuer) shall conform in all respects to the description
thereof in the related Fundamental Change Repurchase Notice.  The Fundamental Change Repurchase Notice
shall state:

(A)      if certificated, the certificate
numbers of Notes to be delivered for repurchase;

(B)        the portion of the principal amount
of Notes to be repurchased, which must be $1,000 or an integral multiple thereof;
and

(C)        that the Notes are to be repurchased
by the Issuer pursuant to the applicable provisions of the Notes and this
Indenture.

Any repurchase by the
Issuer contemplated pursuant to the provisions of this Section 3.06 shall be
consummated by the delivery of the consideration to be received by the
Noteholder promptly following the later of the Fundamental Change Repurchase
Date and the time of the book-entry transfer or delivery of the Note.

The Trustee (or other
Paying Agent appointed by the Issuer) shall promptly notify the Issuer of the
receipt by it of any Fundamental Change Repurchase Notice or written notice of
withdrawal thereof in accordance with the provisions of Section 3.06(c).

Any Note that is to be
repurchased only in part shall be surrendered to the Trustee (with, if the
Issuer or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Issuer and the Trustee duly executed by
the Holder thereof or his attorney duly authorized in writing), and the Issuer
shall execute, and the Trustee shall authenticate and make available for
delivery to the Holder of such Note without service charge, a new Note or
Notes, containing identical terms and conditions, each in an authorized
denomination in aggregate principal amount equal to and in exchange for the
unrepurchased portion of the principal of the Note so surrendered.

Notwithstanding the
foregoing, Holders shall not have the right to require the Company to
repurchase the Notes upon a Change of Control described in clause (3) of the
definition thereof if more than 90% of the consideration in the transaction or
transactions constituting such Change of Control consists of shares of common
stock traded or quoted or to be traded or quoted immediately following 

 25
 

 

such Change of Control on
a U.S. national securities exchange, and, as a result of such transaction or
transactions, the Notes become exchangeable into such common stock (and any
rights attached thereto).

(b)         On or before
the twentieth day after the occurrence of any Fundamental Change, the Issuer
shall provide to all Noteholders of record and the Trustee and Paying Agent a
notice (the “Fundamental Change Issuer Notice”)
of the occurrence of such Fundamental Change and of the repurchase right at the
option of the Noteholders arising as a result thereof.  Such delivering shall be by electronic
delivery or first class mail. 
Simultaneously with providing such Fundamental Change Issuer Notice, the
Issuer shall publish a notice containing the information included therein once
in a newspaper of general circulation in The City of New York or publish such
information on the Issuer’s website or through such other public medium as the
Issuer may use at such time.

Each Fundamental Change
Issuer Notice shall specify:

(i)                                     the events
causing the Fundamental Change;

(ii)                                  the date of
the Fundamental Change;

(iii)                               that the
Noteholder must exercise the repurchase right on or prior to the Close of
Business on the Fundamental Change Repurchase Date;

(iv)                              the
Fundamental Change Repurchase Price;

(v)                                 the
Fundamental Change Repurchase Date;

(vi)                              the name and
address of the Paying Agent and the Exchange Agent;

(vii)                           the
applicable Exchange Rate and any adjustments to the applicable Exchange Rate;

(viii)                        that the
Notes with respect to which a Fundamental Change Repurchase Notice has been
delivered by a Noteholder may be exchanged only if the Noteholder withdraws the
Fundamental Change Repurchase Notice in accordance with the terms of this
Indenture; and

(ix)                                the
procedures that Noteholders must follow to require the Issuer to repurchase
their Notes.

No failure of the Issuer
to give the foregoing notices and no defect therein shall limit the Noteholders’
repurchase rights or affect the validity of the proceedings for the repurchase
of the Notes pursuant to this Section 3.06.

(c)          A
Fundamental Change Repurchase Notice may be withdrawn by means of a written
notice of withdrawal delivered to the Paying Agent in accordance with the
Fundamental Change Issuer Notice at any time prior to the Close of Business on
the Business Day prior to the Fundamental Change Repurchase Date, specifying:

(i)                                     the
principal amount of the Notes with respect to which such notice of withdrawal
is being submitted;

(ii)                                  if
certificated Notes have been issued, the certificate numbers of the withdrawn
Notes; and

 26
 

 

(iii)                               the
principal amount, if any, of such Notes that remains subject to the original
Fundamental Change Repurchase Notice, which portion must be in principal
amounts of $1,000 or an integral multiple of $1,000;

provided, however, that
if the Notes are not in certificated form, the notice must comply with
appropriate procedures of the Depositary.

(d)         On or prior
to 11:00 a.m. (New York City time) on the second Business Day prior to the
Fundamental Change Repurchase Date, the Issuer will deposit with the Trustee
(or other Paying Agent appointed by the Issuer or if the Issuer is acting as
its own Paying Agent, set aside, segregate and hold in trust in accordance with
the Original Indenture) an amount of money sufficient to repurchase on the
Fundamental Change Repurchase Date all of the Notes to be repurchased on such
date at the Fundamental Change Repurchase Price.  Subject to receipt of funds and/or Notes by
the Trustee (or other Paying Agent appointed by the Issuer), payment for Notes
surrendered for repurchase (and not withdrawn) prior to the Close of Business
on the Fundamental Change Repurchase Date will be made promptly after the later
of (x) the Fundamental Change Repurchase Date with respect to such Note
(provided the Noteholder has satisfied the conditions to the payment of the
Fundamental Change Repurchase Price in Section 3.06), and (y) the time of
book-entry transfer or the delivery of such Note to the Trustee (or other
Paying Agent appointed by the Issuer) by the Holder thereof in the manner
required by Section 3.06 by mailing checks for the amount payable to the
Holders of such Notes entitled thereto as they shall appear in the Note
Register, provided, however,
that payments to the Depositary shall be made by wire transfer of immediately
available funds to the account of the Depositary or its nominee.  The Trustee shall, promptly after such
payment and upon written demand by the Issuer, return to the Issuer any funds
in excess of the Fundamental Change Repurchase Price.

(e)          If the
Trustee (or other Paying Agent appointed by the Issuer) holds money or
securities sufficient to repurchase on the Fundamental Change Repurchase Date
all the Notes or portions thereof that are to be purchased as of the second
Business Day prior to the Fundamental Change Repurchase Date, then on and after
the Fundamental Change Repurchase Date (i) such Notes will cease to be
Outstanding, (ii) interest will cease to accrue on such Notes, and
(iii) all other rights of the Holders of such Notes will terminate,
whether or not book-entry transfer of the Notes has been made or the
Notes have been delivered to the Trustee or Paying Agent, other than the right
to receive the Fundamental Change Repurchase Price upon delivery of the Notes.

ARTICLE 4

PARTICULAR COVENANTS OF THE ISSUER

Section 4.01.                             Payment of
Principal, Premium and Interest. 
The Issuer covenants and agrees that it will duly and punctually pay or
cause to be paid when due the principal of (including the Redemption Price upon
redemption or the repurchase price upon repurchase, in each case pursuant to
Article 3), and premium, if any, and interest on each of the Notes at the
places, at the respective times and in the manner provided herein and in the
Notes.

Section 4.02.                             Maintenance
of Office or Agency. 
The Issuer will maintain an office or agency, where the Notes may be
surrendered for registration of transfer or exchange or for presentation for
payment or for exchange, redemption or repurchase and where notices and demands
to or upon the Issuer in respect of the Notes and this Indenture may be served.
As of the date of this Indenture, such office shall be the Corporate Trust
Office and, at any other time, at such other address as the Trustee may
designate from time to time by notice to the Issuer. The Issuer will give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency not designated or appointed by the 

 27
 

 

Trustee. If at any time
the Issuer shall fail to maintain any such required office or agency or shall
fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office.

The Issuer may also from
time to time designate co-registrars and one or more offices or agencies where
the Notes may be presented or surrendered for any or all such purposes and may
from time to time rescind such designations. The Issuer will give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.

The Issuer hereby
initially designates the Trustee as Paying Agent, Note Registrar, Custodian and
Exchange Agent and the Corporate Trust Office shall be considered as one such
office or agency of the Issuer for each of the aforesaid purposes.

So long as the Trustee is
the Note Registrar, the Trustee agrees to deliver, or cause to be delivered,
the notices set forth in Section 7.10 and the third paragraph of Section 7.11.
If co-registrars have been appointed in accordance with this Section, the
Trustee shall deliver such notices only to the Issuer and the Holders of Notes
it can identify from its records.

Section 4.03.                             Appointments
to Fill Vacancies in Trustee’s Office.  The Issuer, whenever necessary to avoid or
fill a vacancy in the office of Trustee, will appoint, upon the terms and
conditions and otherwise as provided in Section 7.10, a Trustee, so that there
shall at all times be a Trustee hereunder.

Section 4.04.                             Provisions
as to Paying Agent. 
(a) If the Issuer shall appoint a Paying Agent other than the
Trustee, or if the Trustee shall appoint such a Paying Agent, the Issuer will
cause such Paying Agent to execute and deliver to the Trustee an instrument in
which such agent shall agree with the Trustee, subject to the provisions of
this Section 4.04:

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

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

(iii)                               that at any
time during the continuance of an Event of Default, upon request of the
Trustee, it will forthwith pay to the Trustee all sums so held in trust.

The Issuer shall, on or
before each due date of the principal of, premium, if any, or interest on the
Notes, deposit with the Paying Agent a sum (in funds which are immediately
available on the due date for such payment) sufficient to pay such principal, premium,
if any, or interest and (unless such Paying Agent is the Trustee) the Issuer
will promptly notify the Trustee of any failure to take such action; provided that if such deposit is made on the due date, such
deposit shall be received by the Paying Agent by 11:00 a.m. New York City time,
on such date.

(b)                                 If the
Issuer shall act as its own Paying Agent, it will, on or before each due date
of the principal of, premium, if any, or interest on the Notes, set aside,
segregate and hold in trust for the benefit of the Holders of the Notes a sum
sufficient to pay such principal, premium, if any, and interest so becoming due
and will promptly notify the Trustee of any failure to take such action and of
any failure by 

 28
 

 

the Issuer (or any other
obligor under the Notes) to make any payment of the principal of, premium, if
any, or interest on the Notes when the same shall become due and payable.

(c)                                  Anything in
this Section 4.04 to the contrary notwithstanding, the Issuer 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 the Issuer or any Paying Agent hereunder as required by this Section
4.04, such sums to be held by the Trustee upon the trusts herein contained and
upon such payment by the Issuer or any Paying Agent to the Trustee, the Issuer
or such Paying Agent shall be released from all further liability with respect
to such sums.

(d)                                 Anything in
this Section 4.04 to the contrary notwithstanding, the agreement to hold sums
in trust as provided in this Section 4.04 is subject to Section 11.02 and
Section 11.03.

The Trustee shall not be
responsible for the actions of any other Paying Agents (including the Issuer if
acting as its own Paying Agent) and shall have no control of any funds held by
such other Paying Agents.

Section 4.05.                             Existence.  Subject to Article 10, each of the Issuer and
the Guarantor will do or cause to be done all things necessary to preserve and
keep in full force and effect its existence and rights (charter and statutory);
provided that neither the Issuer nor the
Guarantor shall be required to preserve any such right if the Issuer or the
Guarantor, as applicable, shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Issuer or the Guarantor,
as applicable, and that the loss thereof is not disadvantageous in any material
respect to the Noteholders.

Section 4.06.                             Rule 144A
Information Requirement. 
If so required by Rule 144A the Guarantor and the Issuer will promptly
furnish to the Holders, beneficial owners and prospective purchasers of the
Notes and of any Common shares delivered upon exchange of the Notes, upon their
request, the information required to be delivered pursuant to Rule 144A(d)(4)
to facilitate the resale of the Notes and the Common shares pursuant to Rule
144A.

Section 4.07.                             Stay,
Extension and Usury Laws. 
The Issuer covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law or other law
which would prohibit or forgive the Issuer from paying all or any portion of
the principal, premium, if any, or interest on the Notes as contemplated
herein, wherever enacted, now or at any time hereafter in force, or which may
affect the covenants or the performance of this Indenture and the Issuer (to
the extent it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power as
though no such law had been enacted.

Section 4.08.                             Compliance
Certificate.  Within one
hundred twenty (120) calendar days after the end of each fiscal year of the
Issuer, the Issuer and the Guarantor shall deliver to the Trustee a certificate
signed by any of the principal executive officer, principal financial officer
or principal accounting officer of the Issuer and the Guarantor, as the case
may be, stating whether or not the signer has knowledge of any default under
this Indenture, and, if so, specifying each default and the nature and the
status thereof.

The Issuer will deliver
to the Trustee, promptly upon becoming aware of (i) any default in the
performance or observance of any covenant, agreement or condition contained in
this Indenture, or (ii) any Event of Default (or any Event of Default on other
Issuer non-recourse debt), an Officers’ Certificate specifying with
particularity such default or Event of Default and further stating what action
the Issuer has taken, is taking or proposes to take with respect thereto.

 29

 

Any notice required to be
given under this Section 4.08 shall be delivered to a Responsible Officer of
the Trustee at its Corporate Trust Office.

Section 4.09.                             Additional
Interest Notice. 
In the event that the Issuer is required to pay Additional Interest to
Holders of Notes pursuant to the Registration Rights Agreement, the Issuer will
provide written notice (“Additional Interest Notice”)
to the Trustee of its obligation to pay Additional Interest no later than
fifteen (15) calendar days prior to the proposed interest payment date for
Additional Interest, and the Additional Interest Notice shall set forth the
amount of Additional Interest to be paid by the Issuer on such interest payment
date. The Trustee shall not at any time be under any duty or responsibility to
any Holder of Notes to determine the Additional Interest, or with respect to
the nature, extent or calculation of the amount of Additional Interest when
made, or with respect to the method employed in such calculation of the
Additional Interest.

ARTICLE 5

NOTEHOLDERS’ LISTS AND REPORTS BY THE ISSUER AND THE TRUSTEE

Section 5.01.                             Noteholders’
Lists.  The Issuer covenants
and agrees that it will furnish or cause to be furnished to the Trustee,
semiannually, not more than fifteen (15) calendar days after each March 15 and
September 15 of each year beginning with March 15, 2007, and at such other
times as the Trustee may reasonably request in writing, within thirty (30)
calendar days after receipt by the Issuer of any such request (or such lesser
time as the Trustee may reasonably request in order to enable it to timely
provide any notice to be provided by it hereunder), a list in such form as the
Trustee may reasonably require of the names and addresses of the Holders of
Notes as of a date not more than fifteen (15) calendar days (or such other date
as the Trustee may reasonably request in order to so provide any such notices)
prior to the time such information is furnished, except that no such list need
be furnished by the Issuer to the Trustee so long as the Trustee is acting as
the sole Note Registrar.

Section 5.02.                             Preservation
and Disclosure of Lists. 
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and addresses of the
Holders of Notes contained in the most recent list furnished to it as provided
in Section 5.01 or maintained by the Trustee in its capacity as Note Registrar
or co-registrar in respect of the Notes, if so acting. The Trustee may destroy
any list furnished to it as provided in Section 5.01 upon receipt of a new list
so furnished.

(b)                                 The rights
of Noteholders to communicate with other Holders of Notes with respect to their
rights under this Indenture or under the Notes, and the corresponding rights
and duties of the Trustee, shall be as provided by the Trust Indenture Act.

(c)                                  Every
Noteholder agrees with the Issuer and the Trustee that neither the Issuer nor
the Trustee nor any agent of either of them shall be held accountable by reason
of any disclosure of information as to names and addresses of Holders of Notes
made pursuant to the Trust Indenture Act.

Section 5.03.                             Reports by
Trustee.  (a) Within
sixty (60) calendar days after September 15 of each year beginning with
September 15, 2007, the Trustee shall transmit to Holders of Notes such reports
dated as of September 15 of the year in which such reports are made concerning
the Trustee and its actions under this Indenture as may be required pursuant to
the Trust Indenture Act at the times and in the manner provided pursuant
thereto. In the event that no events have occurred under the applicable
sections of the Trust Indenture Act the Trustee shall be under no duty or
obligation to provide such reports.

(b)                                 A copy of
such report shall, at the time of such transmission to Holders of Notes, be
filed by the Trustee with each stock exchange and automated quotation system,
if any, upon which the Notes 

 30
 

 

are
listed and with the Issuer. The Issuer will promptly notify the Trustee in
writing if the Notes are listed on any stock exchange or automated quotation
system or de-listed therefrom.

Section 5.04.                             Reports by
Issuer. Whether or not the Issuer is subject to Section 13 or 15(d)
of the Exchange Act and for so long as any Notes are outstanding, within the
time periods required by the applicable rules and regulations of the
Commission, the Issuer will furnish to the Holders of the Notes, or cause the
Trustee to furnish to Trustee and the Holders of the Notes, (1) all quarterly
and annual reports that would be required to be filed with the Commission on
Forms 10-Q and 10-K if the Issuer or the Guarantor were required to file such
reports; and (2) all current reports that would be required to be filed with
the Commission on Form 8-K if the Issuer or the Guarantor were required to file
such reports. Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee’s receipt of such
shall not constitute constructive notice of any information contained therein
or determinable from information contained therein, including the Issuer’s
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on an Officers’ Certificate).

ARTICLE 6

REMEDIES OF THE TRUSTEE AND NOTEHOLDERS ON AN EVENT OF DEFAULT

Section 6.01.                             Events of
Default.  In case one or more
of the following (“Events of Default”)
(whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body) shall have occurred and be continuing:

(a)                                  default for
thirty (30) days in the payment of any installment of interest under the Notes;
or

(b)                                 default in the
payment of the principal amount or any repurchase price or Redemption Price due
with respect to the Notes, when the same becomes due and payable; or

(c)                                  the Issuer
fails to deliver cash, Common shares or a combination of cash and Common shares
within fifteen (15) days after the due date upon an exchange of Notes, together
with any cash due in lieu of fractional shares; or

(d)                                 the Issuer
fails to comply with any of the Issuer’s other agreements contained in the
Notes or this Indenture upon receipt by the Issuer of notice of such default by
the Trustee or by Holders of not less than 25% in aggregate principal amount of
the Notes then outstanding and the Issuer fails to cure (or obtain a waiver of)
such default within sixty (60) days after the Issuer receives such notice; or

(e)                                  a default by
the Issuer, Guarantor or any of their subsidiaries in the payment when due,
after the expiration of any applicable grace period, of principal of, or
premium, if any, or interest on, recourse indebtedness for money borrowed in
the aggregate principal amount then outstanding of $30.0 million or more, or
acceleration of the Issuer’s or the Guarantor’s subsidiaries’ indebtedness for
money borrowed in such aggregate principal amount or more so that it becomes
due and payable before the date on which it would otherwise have become due and
payable, if such default is not cured or waived, or such acceleration is not
rescinded, within 60 days after notice to the Issuer by the Trustee or to the
Issuer and the Trustee by holders at least 25% in the aggregate principal
amount of the Notes then outstanding, in accordance with this Indenture; or

(f)                                    the Issuer
fails to provide on a timely basis an Issuer Repurchase Notice after the
occurrence of a Fundamental Change as provided in Section 3.05(b) and Section
3.07(b); or

 31
 

 

(g)                                 the Issuer,
the Guarantor or any of its Significant Subsidiaries pursuant to or under or
within meaning of any Bankruptcy Law:

(i)                                     commences a
voluntary case or proceeding seeking liquidation, reorganization or other relief
with respect to the Issuer, the Guarantor or a Significant Subsidiary or its
debts or seeking the appointment of a trustee, receiver, liquidator, custodian
or other similar official of the Issuer, the Guarantor or a Significant
Subsidiary or any substantial part of the property of the Issuer, the Guarantor
or a Significant Subsidiary; or

(ii)                                  consents, in
the context of any bankruptcy proceedings as specified in subparagraph (i) of
this section, to any such relief or to the appointment of or taking possession
by any such official in an involuntary case or other proceeding commenced
against the Issuer, the Guarantor or a Significant Subsidiary; or

(iii)                               consents, in
the context of any bankruptcy proceedings as specified in subparagraph (i) of
this section, ,to the appointment of a custodian of it or for all or
substantially of its property; or

(iv)                              makes a
general assignment for the benefit of creditors; or

(h)                                 an
involuntary case or other proceeding shall be commenced against the Issuer, the
Guarantor or any of its Significant Subsidiaries seeking liquidation,
reorganization or other relief with respect to the Issuer, the Guarantor or a
Significant Subsidiary or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of the Issuer, the
Guarantor or a Significant Subsidiary or any substantial part of the property
of the Issuer, the Guarantor or a Significant Subsidiary, and such involuntary
case or other proceeding shall remain undismissed and unstayed for a period of
thirty (30) calendar days; or

(i)                                     a court of
competent jurisdiction enters an order or decree under any Bankruptcy Law that:

(i)                                     is for
relief against the Issuer, the Guarantor or any of its Significant Subsidiaries
in an involuntary case or proceeding; or

(ii)                                  appoints a
trustee, receiver, liquidator, custodian or other similar official of the
Issuer, the Guarantor or a Significant Subsidiary or any substantial part of
the property of the Issuer, the Guarantor or a Significant Subsidiary; or

(iii)                               orders the
liquidation of the Issuer, the Guarantor or a Significant Subsidiary; and, in
each case in this clause (i), the order or decree remains unstayed and in effect
for thirty (30) calendar days;

then, and in each and
every such case (other than an Event of Default specified in Section 6.01(g),
6.01(h) and 6.01(i) with respect to the Issuer), unless the principal of all of
the Notes shall have already become due and payable, either the Trustee or the
Holders of at least twenty-five percent (25%) in aggregate principal amount of
the Notes then outstanding, by notice in writing to the Issuer (and to the
Trustee if given by Noteholders), may declare the principal amount of and
premium, if any, and interest accrued and unpaid on all the Notes to be
immediately due and payable, and upon any such declaration the same shall be
immediately due and payable.

 32
 

 

If an Event of Default
specified in Section 6.01(g), 6.01(h) or 6.01(i) occurs with respect to the
Issuer, the principal amount of and premium, if any, and interest accrued and
unpaid on all the Notes shall be immediately and automatically due and payable
without necessity of further action.

If, at any time after the
principal amount of and premium, if any, and interest on the Notes shall have
been so declared due and payable, and before any judgment or decree for the
payment of the monies due shall have been obtained or entered as hereinafter
provided, Holders of a majority in aggregate principal amount of the Notes then
outstanding on behalf of the Holders of all of the Notes then outstanding, by
written notice to the Issuer and to the Trustee, may waive all defaults or
Events of Default and rescind and annul such declaration and its consequences,
subject in all respects to Section 6.07, if: (a) the rescission would not
conflict with any judgment or decree of a court of competent jurisdiction; (b)
all Events of Default, other than the nonpayment of the principal amount and any
accrued and unpaid interest that have become due solely because of such
acceleration, have been cured or waived; (c) interest on overdue installments
of interest (to the extent that payment of such interest is lawful) and on
overdue principal, which has become due otherwise than by such declaration of
acceleration, has been paid; and (d) the Issuer has paid the Trustee its
reasonable compensation and reimbursed the Trustee for its expenses,
disbursements and advances pursuant to Section 7.06. No such rescission and
annulment shall extend to or shall affect any subsequent default or Event of
Default, or shall impair any right consequent thereon. The Issuer shall notify
in writing a Responsible Officer of the Trustee, promptly upon becoming aware
thereof, of any Event of Default, as provided in Section 4.08.

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

Section 6.02.                             Payments of
Notes on Default; Suit Therefor. 
The Issuer covenants that in the case of an Event of Default pursuant to
Section 6.01(a) or 6.01(b), upon demand of the Trustee, the Issuer will pay to
the Trustee, for the benefit of the Holders of the Notes, (i) the whole amount
that then shall be due and payable on all such Notes for principal and premium,
if any, or interest, as the case may be, with interest upon the overdue
principal and premium, if any, and (to the extent that payment of such interest
is enforceable under applicable law) upon the overdue installments of accrued
and unpaid interest at the rate borne by the Notes, plus 1%, from the required
payment date and, (ii) in addition thereto, any amounts due the Trustee under
Section 7.06. Until such demand by the Trustee, the Issuer may pay the
principal of and premium, if any, and interest on the Notes to the registered
Holders, whether or not the Notes are overdue.

In case the Issuer 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 Issuer or any other obligor on the Notes and collect in the manner
provided by law out of the property of the Issuer or any other obligor on the
Notes wherever situated the monies adjudged or decreed to be payable.

In case there shall be
pending proceedings for the bankruptcy or for the reorganization of the Issuer
or any other obligor on the Notes under any Bankruptcy Law, or any other
applicable law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been appointed
for or taken possession of the Issuer or such other obligor, the property

 33
 

 

of the Issuer or such
other obligor, or in the case of any other judicial proceedings relative to the
Issuer or such other obligor upon the Notes, or to the creditors or property of
the Issuer or such other obligor, the Trustee, irrespective of whether the
principal of the Notes 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 6.02, 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, accrued and unpaid interest in respect of the Notes, and, in case of any
judicial proceedings, to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee and of the Noteholders allowed in such judicial proceedings relative to
the Issuer or any other obligor on the Notes, its or their creditors, or its or
their property, and to collect and receive any monies or other property payable
or deliverable on any such claims, and to distribute the same after the
deduction of any amounts due the Trustee under Section 7.06, and to take any
other action with respect to such claims, including participating as a member
of any official committee of creditors, as it reasonably deems necessary or
advisable, unless prohibited by law or applicable regulations, and any
receiver, assignee or trustee in bankruptcy or reorganization, liquidator,
custodian or similar official is hereby authorized by each of the Noteholders
to make such payments to the Trustee, and, in the event that the Trustee shall
consent to the making of such payments directly to the Noteholders, to pay to
the Trustee any amount due it for reasonable compensation, expenses, advances
and disbursements, including counsel fees and expenses incurred by it up to the
date of such distribution. To the extent that such payment of reasonable
compensation, expenses, advances and disbursements out of the estate in any
such proceedings shall be denied for any reason, payment of the same shall be
secured by a lien on, and shall be paid out of, any and all distributions,
dividends, monies, securities and other property which the Holders of the Notes
may be entitled to receive in such proceedings, whether in liquidation or under
any plan of reorganization or arrangement or otherwise.

All rights of action and
of asserting claims under this Indenture, or under any of the Notes, may be
enforced by the Trustee without the possession of any of the Notes, 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 of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Notes.

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

Section 6.03.                             Application
of Monies Collected by Trustee. 
Any monies collected by the Trustee pursuant to this Article 6, shall be
applied, in the following order, at the date or dates fixed by the Trustee for
the distribution of such monies, upon presentation of the several Notes, and
stamping thereon the payment, if only partially paid, and upon surrender
thereof, if fully paid:

FIRST:  To the payment of all amounts due the Trustee
under Section 7.06;

SECOND:  In case the principal of the outstanding
Notes shall not have become due and be unpaid, to the payment of accrued and
unpaid interest, if any, on the Notes in default in the order of the maturity
of the installments of such interest, with interest (to the extent that such
interest has been collected by the Trustee) as provided in Section 6.02 upon
the overdue installments of interest at the annual rate of 1% above then
applicable interest rate, such payments to be made ratably to the Persons
entitled thereto;

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THIRD:  In case the principal of the outstanding
Notes shall have become due, by declaration or otherwise, and be unpaid to the
payment of the whole amount then owing and unpaid upon the Notes for principal
and premium, if any, and interest, with interest on the overdue principal and
premium, if any, and (to the extent that such interest has been collected by
the Trustee) upon overdue installments of accrued and unpaid interest, as
provided in Section 6.02, and in case such monies shall be insufficient to pay
in full the whole amounts so due and unpaid upon the Notes, then to the payment
of such principal and premium, if any, and interest without preference or
priority of principal and premium, if any, over interest, or of interest over
principal and premium, if any, or of any installment of interest over any other
installment of interest, or of any Note over any other Note, 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 Issuer or any other Person lawfully entitled thereto.

Section 6.04.                             Proceedings
by Noteholders. 
No Holder of any Note shall have any right by virtue of or by reference
to any provision of this Indenture to institute any suit, action or proceeding
in equity or at law upon or under or with respect to this Indenture, or for the
appointment of a receiver, trustee, liquidator, custodian or other similar
official, or for any other remedy hereunder, except in the case of a default in
the payment of principal, premium, if any, or interest on the Notes, unless (a)
such Holder previously shall have given to the Trustee written notice of an
Event of Default and of the continuance thereof, as hereinbefore provided, (b)
the Holders of at least twenty-five percent (25%) in aggregate principal amount
of the Notes 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 security or indemnity as
it may require against the costs, liabilities or expenses to be incurred
therein or thereby, (c) the Trustee for sixty (60) calendar days after its
receipt of such notice, request and offer of indemnity, shall have neglected or
refused to institute any such action, suit or proceeding and (d) no direction
inconsistent with such written request shall have been given to the Trustee
pursuant to Section 6.07; it being understood and intended, and being expressly
covenanted by the taker and Holder of every Note with every other taker and
Holder and the Trustee, that no one or more Holders of Notes shall have any
right in any manner whatever by virtue of or by reference to any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holder
of Notes, or to obtain or seek to obtain priority over or preference to any
other such Holder, or to enforce any right under this Indenture, except in the
manner herein provided and for the equal, ratable and common benefit of all
Holders of Notes (except as otherwise provided herein). For the protection and
enforcement of this Section 6.04, each and every Noteholder and the Trustee
shall be entitled to such relief as can be given either at law or in equity.

Notwithstanding any other
provision of this Indenture and any provision of any Note, the right of any
Holder of any Note to receive payment of the principal of (including the
Redemption Price or repurchase price upon redemption or repurchase pursuant to
Article 3) and premium, if any, and accrued interest on such Note, on or after
the respective due dates expressed in such Note or in the event of redemption
or repurchase, or to institute suit for the enforcement of any such payment on
or after such respective dates against the Issuer shall not be impaired or
affected without the consent of such Holder.

Anything contained in
this Indenture or the Notes to the contrary notwithstanding, the Holder of any
Note, without the consent of either the Trustee or the Holder of any other
Note, in its own behalf and for its own benefit, may enforce, and may institute
and maintain any proceeding suitable to enforce, its rights of exchange as
provided herein.

Section 6.05.                             Proceedings
by Trustee.  In case of an
Event of Default, the Trustee may, in its discretion, proceed to protect and
enforce the rights vested in it by this Indenture by such appropriate 

 35
 

 

judicial proceedings as
are necessary to protect and enforce any of such rights, either by suit in
equity or by action at law or by proceeding in bankruptcy or otherwise, whether
for the specific enforcement of any covenant or agreement contained in this
Indenture or in aid of the exercise of any power granted in this Indenture, or
to enforce any other legal or equitable right vested in the Trustee by this
Indenture or by law.

Section 6.06.                             Remedies
Cumulative and Continuing. 
All powers and remedies given by this Article 6 to the Trustee or to the
Noteholders shall, to the extent permitted by law, be deemed cumulative and not
exclusive of any thereof or of any other powers and remedies available to the
Trustee or the Holders of the Notes, by judicial proceedings or otherwise, to
enforce the performance or observance of the covenants and agreements contained
in this Indenture, and no delay or omission of the Trustee or of any Holder of
any of the Notes to exercise any right or power accruing upon any default or
Event of Default occurring and continuing as aforesaid shall impair any such
right or power, or shall be construed to be a waiver of any such default or any
acquiescence therein, and, subject to the provisions of Section 6.04, every
power and remedy given by this Article 6 or by law to the Trustee or to the
Noteholders may be exercised from time to time, and as often as shall be deemed
expedient, by the Trustee or by the Noteholders.

Section 6.07.                             Direction of
Proceedings and Waiver of Defaults by Majority of Noteholders.  The Holders of not less than a majority in
aggregate principal amount of the Notes 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; provided that (a) such direction shall not be in conflict with any
rule of law or with the terms of this Indenture, (b) the Trustee may take any
other action which is not inconsistent with such direction, (c) the Trustee may
decline to take any action that would benefit some Noteholders to the detriment
of other Noteholders and (d) the Trustee may decline to take any action that
would involve the Trustee in personal liability.

The Holders of a majority
in aggregate principal amount of the Notes at the time outstanding may, on
behalf of the Holders of all of the Notes, waive any past default or Event of
Default hereunder and its consequences except (i) a
default in the payment of the principal of (including the Redemption Price or
repurchase price upon redemption or repurchase pursuant to Article 3), premium,
if any, or interest on the Notes, (ii) a failure by the Issuer to exchange any
Notes as required by this Indenture, (iii) a default in the payment of the Redemption
Price on the Redemption Date pursuant to Article 3, (iv) a default in the
payment of the repurchase price on the Fundamental Change Repurchase Date or
the Repurchase Date pursuant to Article 3 or (v) a default in respect of a
covenant or provisions hereof which under Article 9 cannot be modified or
amended without the consent of the Holders of all Notes then outstanding or
each Note affected thereby.

Upon any such waiver, the
Issuer, the Trustee and the Holders of the Notes shall be restored to their
former positions and rights hereunder; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon. Whenever any default or Event of Default hereunder shall have been
waived as permitted by this Section 6.07, said default or Event of Default
shall for all purposes of the Notes and this Indenture be deemed to have been
cured and to be not continuing; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.

Section 6.08.                             Notice of
Defaults.  The Trustee shall,
within ninety (90) calendar days after a Responsible Officer of the Trustee has
knowledge of the occurrence of a default, mail to all Noteholders, as the names
and addresses of such Holders appear upon the Note Register, notice of all
defaults known to a Responsible Officer, unless such defaults shall have been
cured or waived before the giving of such notice; provided
that except in the case of default in the payment of the principal of
(including the 

 36
 

 

Redemption Price or
repurchase price upon redemption or repurchase pursuant to Article 3), or
interest on any of the Notes, the Trustee shall be protected in withholding
such notice if and so long as a trust committee of trustees and/or Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interest of the Noteholders.

Section 6.09.                             Undertaking
to Pay Costs.  All parties
to this Indenture agree, and each Holder of any Note by its acceptance thereof
shall be deemed to have agreed, that any court may, in its discretion, require,
in any suit for the enforcement of any right or remedy under this Indenture, or
in any suit against the Trustee for any action taken or omitted by it as
Trustee, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit and that such court may in its discretion assess
reasonable costs, including reasonable attorneys’ fees and expenses, against
any party litigant in such suit, having due regard to the merits and good faith
of the claims or defenses made by such party litigant; provided
that the provisions of this Section 6.09 (to the extent permitted by law) shall
not apply to any suit instituted by the Trustee, to any suit instituted by any
Noteholder, or group of Noteholders, holding in the aggregate more than ten
percent in principal amount of the Notes at the time outstanding determined in
accordance with Section 8.04, or to any suit instituted by any Noteholder for
the enforcement of the payment of the principal of (including the Redemption
Price or repurchase price upon redemption or repurchase pursuant to Article 3),
or interest on any Note on or after the due date expressed in such Note or to
any suit for the enforcement of the right to exchange any Note in accordance
with the provisions of Article 13.

ARTICLE 7

THE TRUSTEE

Section 7.01.                             Duties and
Responsibilities of Trustee. 
The Trustee, prior to the occurrence of an Event of Default and after
the curing or waiver of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Indenture. In case an Event of Default has occurred (which has
not been cured or waived), the Trustee shall exercise such of the rights and
powers vested in it by this Indenture, and use the same degree of care and
skill in their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of its own affairs.

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

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

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

(ii)                                  in the
absence of bad faith and willful misconduct on the part of the Trustee, the
Trustee may conclusively rely as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Trustee and conforming to the requirements of this
Indenture; but, in the case of any such certificates or opinions which by any
provisions hereof are specifically required to be furnished to the Trustee, the
Trustee shall be 

 37
 

 

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 and/or and Opinion of Counsel,
unless the Trustee was negligent in ascertaining the pertinent facts;

(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 written direction of the Holders of not
less than a majority in principal amount of the Notes at the time outstanding
determined as provided in Section 8.04 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;

(d)                                 whether or
not therein provided, every provision of this Indenture relating to the conduct
or affecting the liability of, or affording protection to, the Trustee shall be
subject to the provisions of this Section;

(e)                                  the Trustee
shall not be liable in respect of any payment (as to the correctness of amount,
entitlement to receive or any other matters relating to payment) or notice
effected by the Issuer or any Paying Agent (other than the Trustee) or any
records maintained by any co-registrar (other than the Trustee) with respect to
the Notes;

(f)                                    if any party
fails to deliver a notice relating to an event the fact of which, pursuant to
this Indenture, requires notice to be sent to the Trustee, the Trustee may
conclusively rely on its failure to receive such notice as reason to act as if
no such event occurred unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless the Trustee has otherwise received written notice
thereof; and

(g)                                 the Trustee
shall not be deemed to have knowledge of any Event of Default hereunder unless
a Responsible Officer of the Trustee has actual knowledge thereof or unless the
Trustee shall have been notified in writing of such Event of Default by the
Issuer or a Holder of Notes.

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 adequate
indemnity against such risk or liability is not reasonably assured to it.

Section 7.02.                             Reliance on
Documents, Opinions, etc. 
Except as otherwise provided in Section 7.01:

(a)                                  the Trustee
may conclusively rely and shall be protected in acting upon any resolution,
certificate, statement, instrument, opinion, report, notice, request, consent,
order, bond, note, coupon or other paper or document (whether in its original
or facsimile form) believed by it in good faith to be genuine and to have been
signed or presented by the proper party or parties;

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

 38
 

 

(c)                                  the Trustee
may consult with counsel of its own selection and any advice or 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 reliance on
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
Noteholders pursuant to the provisions of this Indenture, unless such
Noteholders shall have offered to the Trustee reasonable security or indemnity
reasonably satisfactory to it against the costs, expenses and liabilities which
may be incurred therein or thereby;

(e)                                  the Trustee
shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, note or other paper or document, but
the Trustee may make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Issuer, personally or by agent or attorney;

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

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

(h)                                 the rights,
privileges, protections, immunities and benefits given to the Trustee,
including, without limitation, its right to be indemnified, are extended to,
and shall be enforceable by, the Trustee in each of its capacities hereunder,
and each agent, custodian and other Person employed to act hereunder;

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

(j)                                     any
permissive right or authority granted to the Trustee shall not be construed as
a mandatory duty.

Section 7.03.                             No
Responsibility for Recitals, etc. 
The recitals contained herein and in the Notes (except in the Trustee’s
certificate of authentication) shall be taken as the statements of the Issuer,
and the Trustee 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 Notes. The Trustee shall not be accountable for the use or
application by the Issuer of any Notes or the proceeds of any Notes
authenticated and delivered by the Trustee in conformity with the provisions of
this Indenture.

Section 7.04.                             Trustee,
Paying Agents, Exchange Agents or Registrar May Own Notes.  The Trustee, any Paying Agent, the Exchange
Agent or Note Registrar, in its individual or any other capacity, may become
the owner or pledgee of Notes with the same rights it would have if it were not
Trustee, Paying Agent, Exchange Agent or Note Registrar.

 39
 

 

Section 7.05.                             Monies to Be
Held in Trust.  Subject to
the provisions of Section 11.02, all monies received by the Trustee shall,
until used or applied as herein provided, be held in trust for the purposes for
which they were received. Money held by the Trustee in trust hereunder need not
be segregated from other funds except to the extent required by law. Except as
otherwise provided herein, the Trustee shall be under no liability for interest
on any money received by it hereunder except as may be agreed in writing from
time to time by the Issuer and the Trustee.

Section 7.06.                             Compensation
and Expenses of Trustee. 
The Issuer covenants and agrees to pay to the Trustee from time to time,
and the Trustee shall be entitled to, such compensation for all services
rendered by it hereunder in any capacity (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust) as mutually agreed to from time to time in writing between the Issuer
and the Trustee, and the Issuer will pay or reimburse the Trustee upon its
request for all reasonable expenses, disbursements and advances reasonably
incurred or made by the Trustee in accordance with any of the provisions of
this Indenture (including the reasonable compensation and the reasonable
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, willful misconduct, recklessness or bad faith. The Issuer also
covenants to indemnify the Trustee and any predecessor Trustee (or any officer,
director or employee of the Trustee), in any capacity under this Indenture and
any authenticating agent for, and to hold them harmless against, any and all
loss, liability, damage, claim or reasonable expense including taxes (other
than taxes based on the income of the Trustee) incurred without negligence,
willful misconduct, recklessness or bad faith on the part of the Trustee or
such officers, directors, employees or authenticating agent, as the case may
be, and arising out of or in connection with the acceptance or administration
of this trust or in any other capacity hereunder, including the reasonable
costs and expenses of defending themselves against any claim (whether asserted
by the Issuer, any Holder or any other Person) of liability in the premises.
The obligations of the Issuer under this Section 7.06 to compensate or
indemnify the Trustee and to pay or reimburse the Trustee for reasonable
expenses, disbursements and advances shall be secured by a lien prior to that
of the Notes 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
Notes. The obligation of the Issuer under this Section shall survive the
satisfaction and discharge of this Indenture.

When the Trustee and its
agents and any authenticating agent incur expenses or render services after an
Event of Default specified in Section 6.0 1(g), 6.01(h) or 6.01(i) with respect
to the Issuer occurs, the expenses and the compensation for the services are
intended to constitute reasonable expenses of administration under any
bankruptcy, insolvency or similar laws.

Section 7.07.                             Officers’
Certificate as Evidence. 
Except as otherwise provided in Section 7.01, 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 gross
negligence, bad faith, recklessness or willful misconduct on the part of the
Trustee, be deemed to be conclusively proved and established by an Officers’
Certificate delivered to the Trustee.

Section 7.08.                             Conflicting
Interests of Trustee. 
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.

Section 7.09.                             Eligibility
of Trustee.  There shall
at all times be a Trustee hereunder which shall be a Person that is eligible
pursuant to the Trust Indenture Act to act as such and has a combined capital
and surplus of at least $50 million (or if such Person is a member of a bank
holding company system, its 

 40
 

 

bank holding company
shall have a combined capital and surplus of at least $50 million). If such
Person publishes reports of condition at least annually, pursuant to law or to
the requirements of any supervising or examining authority, then for the
purposes of this Section the combined capital and surplus of such Person shall
be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section 7.09, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article.

Section 7.10.                             Resignation
or Removal of Trustee. 
(a) The Trustee may at any time resign by giving written notice of
such resignation to the Issuer and to the Holders of Notes. Upon receiving such
notice of resignation, the Issuer shall promptly appoint a successor trustee by
written instrument, in duplicate, executed by order of the Board of Trustees,
one copy of which instrument shall be delivered to the resigning Trustee and
one copy to the successor trustee. If no successor trustee shall have been so
appointed and have accepted appointment sixty (60) calendar days after the
mailing of such notice of resignation to the Noteholders, the resigning Trustee
may, upon ten Business Days’ notice to the Issuer and the Noteholders, appoint
a successor identified in such notice or may petition, at the expense of the
Issuer, any court of competent jurisdiction for the appointment of a successor
trustee, or, if any Noteholder who has been a bona fide holder of a Note or
Notes for at least six months may, subject to the provisions of Section 6.09,
on behalf of itself 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:

(i)                                     the Trustee
shall fail to comply with Section 7.08 after written request therefor by the
Issuer or by any Noteholder who has been a bona fide holder of a Note or Notes
for at least six months; or

(ii)                                  the Trustee
shall cease to be eligible in accordance with the provisions of Section 7.09
and shall fail to resign after written request therefor by the Issuer or by any
such Noteholder; or

(iii)                               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 Issuer may remove the Trustee upon 30 days written notice and appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Trustees, 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 6.09, any Noteholder who has been a bona fide holder of a
Note or Notes for at least six months may, on behalf of itself and all others
similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor trustee; provided that if no successor Trustee shall have been
appointed and have accepted appointment sixty (60) calendar days after either
the Issuer or the Noteholders has removed the Trustee, or the Trustee resigns,
the Trustee so removed may petition, at the expense of the Issuer, any court of
competent jurisdiction for an appointment of a successor trustee. Such court
may thereupon, after such notice, if any, as it may deem proper and prescribe,
remove the Trustee and appoint a successor trustee.

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(c)                                  Any
resignation or removal of the Trustee and appointment of a successor trustee
pursuant to any of the provisions of this Section 7.10 shall become effective
upon acceptance of appointment by the successor trustee as provided in Section
7.11.

(d)                                 Notwithstanding
the replacement of the Trustee pursuant to this Section, the Issuer’s
obligations under Section 7.06 shall continue for the benefit of the retiring
Trustee.

Section 7.11.                             Acceptance
by Successor Trustee. 
Any successor trustee appointed as provided in Section 7.10 shall
execute, acknowledge and deliver to the Issuer 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 Issuer or of the successor trustee,
the trustee ceasing to act shall, upon payment of any amount then due it
pursuant to the provisions of Section 7.06, execute and deliver an instrument
transferring to such successor trustee all the rights and powers of the trustee
so ceasing to act. Upon request of any such successor trustee, the Issuer shall
execute any and all instruments in writing for more fully and certainly vesting
in and confirming to such successor trustee all such rights and powers. Any
trustee ceasing to act shall, nevertheless, retain a lien upon all property and
funds held or collected by such trustee as such, except for funds held in trust
for the benefit of Holders of particular Notes, to secure any amounts then due
it pursuant to the provisions of Section 7.06.

No successor trustee
shall accept appointment as provided in this Section 7.11 unless, at the time
of such acceptance, such successor trustee shall be qualified under the
provisions of Section 7.08 and be eligible under the provisions of Section
7.09.

Upon acceptance of
appointment by a successor trustee as provided in this Section 7.11, the Issuer
(or the former trustee, at the written direction of the Issuer) shall deliver
or cause to be delivered notice of the succession of such trustee hereunder to
the Holders of Notes at their addresses as they shall appear on the Note
Register. If the Issuer fails to deliver such notice within ten (10) calendar
days after acceptance of appointment by the successor trustee, the successor
trustee shall cause such notice to be delivered at the expense of the Issuer.

Section 7.12.                             Succession
by Merger.  Any
corporation into which the Trustee may be merged or exchanged or with which it
may be consolidated, or any corporation resulting from any merger, exchange or
consolidation to which the Trustee shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of the
Trustee (including any trust created by this Indenture), shall be the successor
to the Trustee hereunder without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided
that in the case of any corporation succeeding to all or substantially all of
the corporate trust business of the Trustee, such corporation shall be
qualified under the provisions of Section 7.08 and eligible under the
provisions of Section 7.09.

In case at the time such
successor to the Trustee shall succeed to the trusts created by this Indenture,
any of the Notes shall have been authenticated but not delivered, any such
successor to the Trustee may adopt the certificate of authentication of any
predecessor trustee or authenticating agent appointed by such predecessor
trustee, and deliver such Notes so authenticated; and in case at that time any
of the Notes shall not have been authenticated, any successor to the Trustee or
any authenticating agent appointed by such successor trustee may authenticate
such Notes in the name of the successor trustee; and in all such cases such
certificates shall have the full force that is provided in the Notes or in this
Indenture; provided that the right to adopt the
certificate of authentication of any predecessor Trustee 

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or authenticate Notes in
the name of any predecessor Trustee shall apply only to its successor or
successors by merger, exchange or consolidation.

Section 7.13.                             Preferential
Collection of Claims. 
If and when the Trustee shall be or become a creditor of the Issuer (or
any other obligor upon the Notes), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of the claims
against the Issuer (or any such other obligor).

ARTICLE 8

THE NOTEHOLDERS

Section 8.01.                             Action by
Noteholders.  Whenever in
this Indenture it is provided that the Holders of a specified percentage in
aggregate principal amount of the Notes may take any action (including the
making of any demand or request, the giving of any notice, consent or waiver or
the taking of any other action), the fact that at the time of taking any such
action, the Holders of such specified percentage have joined therein may be
evidenced (a) by any instrument or any number of instruments of similar tenor
executed by Noteholders in person or by agent or proxy appointed in writing, or
(b) by the record of the Holders of Notes voting in favor thereof at any meeting
of Noteholders, or (c) by a combination of such instrument or instruments and
any such record of such a meeting of Noteholders. Whenever the Issuer or the
Trustee solicits the taking of any action by the Holders of the Notes, the
Issuer or the Trustee may fix in advance of such solicitation a date as the
Record Date for determining Holders entitled to take such action. The Record
Date, if any, shall be not more than fifteen (15) calendar days prior to the
date of commencement of solicitation of such action.

Section 8.02.                             Proof of
Execution by Noteholders. 
Subject to the provisions of Sections 7.01 and 7.02, proof of the
execution of any instrument by a Noteholder or its agent or proxy shall be
sufficient if made in accordance with such reasonable rules and regulations as
may be prescribed by the Trustee or in such manner as shall be satisfactory to
the Trustee. The holding of Notes shall be proved by the registry of such Notes
or by a certificate of the Note Registrar.

Section 8.03.                             Absolute
Owners.  The Issuer, the
Trustee, any Paying Agent, any exchange agent and any Note Registrar may deem
the Person in whose name such Note shall be registered upon the Note Register
to be, and may treat it as, the absolute owner of such Note (whether or not
such Note shall be overdue and notwithstanding any notation of ownership or
other writing thereon made by any Person other than the Issuer or any Note
Registrar) for the purpose of receiving payment of or on account of the
principal of (including the Redemption Price or repurchase price upon
redemption or repurchase pursuant to Article 3), premium, if any, and interest
on such Note, for exchange of such Note and for all other purposes; and neither
the Issuer nor the Trustee nor any Paying Agent nor any exchange agent nor any
Note Registrar shall be affected by any notice to the contrary. All such
payments so made to any Holder for the time being, or upon its order, shall be
valid, and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability for monies payable upon any such Note.

Section 8.04.                             Issuer-owned
Notes Disregarded. 
In determining whether the Holders of the requisite aggregate principal
amount of Notes have concurred in any direction, consent, waiver or other
action under this Indenture, Notes which are owned by the Issuer or any other
obligor on the Notes or any Affiliate of the Issuer or any other obligor on the
Notes shall be disregarded and deemed not to be outstanding for the purpose of
any such determination; provided that
for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, consent, waiver or other action, only Notes
which a Responsible Officer knows are so owned shall be so disregarded. Notes
so owned which have been pledged in good faith may be regarded as outstanding
for the purposes of this Section 

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8.04 if the pledgee shall
establish to the satisfaction of the Trustee the pledgee’s right to vote such
Notes and that the pledgee is not the Issuer, any other obligor on the Notes or
any Affiliate of the Issuer or any such other obligor. In the case of a dispute
as to such right, any decision by the Trustee taken upon the advice of counsel
shall be full protection to the Trustee. Upon request of the Trustee, the Issuer
shall furnish to the Trustee promptly an Officers’ Certificate listing and
identifying all Notes, if any, known by the Issuer to be owned or held by or
for the account of any of the above described Persons, and, subject to Section
7.01, the Trustee shall be entitled to accept such Officers’ Certificate as
conclusive evidence of the facts therein set forth and of the fact that all
Notes not listed therein are outstanding for the purpose of any such
determination.

Section 8.05.                             Revocation
of Consents; Future Holders Bound. 
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 8.01, of the taking of any action by the Holders of the
percentage in aggregate principal amount of the Notes specified in this
Indenture in connection with such action, any Holder of a Note which is shown
by the evidence to be included in the Notes the Holders of which have consented
to such action may, by filing written notice with the Trustee at its Corporate
Trust Office and upon proof of holding as provided in Section 8.02, revoke such
action so far as concerns such Note. Except as aforesaid, any such action taken
by the Holder of any Note shall be conclusive and binding upon such Holder and
upon all future Holders and owners of such Note and of any Notes issued in
exchange or substitution therefor, irrespective of whether any notation in
regard thereto is made upon such Note or any Note issued in exchange or
substitution therefor.

ARTICLE 9

SUPPLEMENTAL INDENTURES

Section 9.01.                             Supplemental
Indentures Without Consent of Noteholders.  The Issuer, when authorized by the
resolutions of the Board of Trustees, the Guarantor and the Trustee may, from
time to time, and at any time enter into an indenture or indentures
supplemental without the consent of the Holders of the Notes hereto for one or
more of the following purposes:

(a)                                  to evidence
a successor to the Issuer as obligor or to the Guarantor as guarantor under
this Indenture;

(b)                                 to add to
the covenants of the Issuer or the Guarantor for the benefit of the Holders of
the Notes or to surrender any right or power conferred upon the Issuer or the
Guarantor in this Indenture or in the Notes;

(c)                                  to add
Events of Default for the benefit of the Holders of the Notes;

(d)                                 to amend or
supplement any provisions of this Indenture; provided that
no amendment or supplement shall materially adversely affect the interests of
the Holders of any Notes then outstanding, or to impose extra burdens or
responsibilities upon the Trustee without its prior consent;

(e)                                  to secure
the Notes;

(f)                                    to provide
for the acceptance of appointment of a successor Trustee or facilitate the
administration of the trusts under this Indenture by more than one Trustee;

(g)                                 to cure any
ambiguity, defect or inconsistency in this Indenture; provided that
this action shall not adversely affect the interests of the Holders of the
Notes in any material respect;

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(h)                                 to
supplement any of the provisions of this Indenture to the extent necessary to
permit or facilitate defeasance and discharge of any of the Notes; provided that the action shall not adversely affect the
interests of the Holders of the Notes in any material respect;

(i)                                     to modify
this Indenture and the Notes to increase the Exchange Rate or reduce the
Exchange Price; provided that the increase or
reduction, as the case may be, is in accordance with the terms of the Notes or
will not adversely affect the interests of the Holders of the Notes; or

(j)                                     upon receipt
of an Officers’ Certificate stating that a provision in the “Description of Notes”
included in the Offering Memorandum related to the Initial Notes is intended to
be a verbatim recitation of a provision of this Indenture, any Guarantee or the
Notes, to conform the text of the Indenture, such Guarantee or the Notes to
such provision of the “Description of Notes”.

Upon the written request
of the Issuer, accompanied by a copy of the resolutions of the Board of
Trustees certified by the General Partner’s Secretary or Assistant Secretary
authorizing the execution of any supplemental indenture, the Trustee is hereby
authorized to join with the Issuer and the Guarantor in the execution of any
such supplemental indenture, to make any further appropriate agreements and
stipulations that may be therein contained and to accept the conveyance, transfer
and assignment of any property thereunder, but the Trustee shall not be
obligated to, but may in its discretion, enter into any supplemental indenture
that affects the Trustee’s own rights, duties or immunities under this
Indenture or otherwise.

Any supplemental
indenture authorized by the provisions of this Section 9.01 may be executed by
the Issuer, the Guarantor and the Trustee without the consent of the Holders of
any of the Notes at the time outstanding, notwithstanding any of the provisions
of Section 9.02.

In addition, without the
consent of any holder of the Notes, the Guarantor, or a subsidiary thereof, may
directly assume the due and punctual payment of the principal of, any premium
and interest on all the Notes and the performance of every covenant of the
Indenture on the part of the Issuer to be performed or observed.  Upon any assumption, the Guarantor or the
subsidiary shall succeed to, and be substituted for and may exercise every
right and power of, the Issuer under the indenture with the same effect as if
the Guarantor or the subsidiary had been the issuer of the Notes and the Issuer
shall be released from all obligations and covenants with respect to the
Notes.  No assumption shall be permitted unless
the Guarantor has delivered to the Trustee (1) an officers’ certificate and an
opinion of counsel, stating, among other things, that the guarantee and all
other covenants of the Guarantor in the Indenture remain in full force and
effect and (2) an opinion of independent counsel that the holders of the Notes
shall have no materially adverse U.S. federal tax consequences as a result of
the assumption, and that, if any Notes are then listed on the New York Stock
Exchange, that the Notes shall not be de-listed as a result of the assumption.

Section 9.02.                             Supplemental
Indenture With Consent of Noteholders.  With the consent (evidenced as provided in
Article 8) of the Holders of not less than a majority in aggregate principal
amount of the Notes at the time outstanding, the Issuer, when authorized by the
resolutions of the Board of Trustees, the Guarantor 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 any
supplemental indenture or modifying in any manner the rights of the Holders of
the Notes; provided that no such supplemental
indenture shall, without the consent of the Holder of each Note:

(a)                                  change the Stated
Maturity of the principal of or any installment of interest on the Notes,
reduce the principal amount of, or the rate or amount of interest on, or any
premium payable on 

 45
 

 

redemption of, the Notes,
or adversely affect any right of repayment of the Holder of the Notes, change
the place of payment, or the coin or currency, for payment of principal of or
interest on any Note or impair the right to institute suit for the enforcement
of any payment on or with respect to the Notes;

(b)                                 reduce the
percentage in principal amount of the outstanding Notes necessary to modify or
amend this Indenture, to waive compliance with certain provisions of this
Indenture or certain defaults and their consequences provided in this
Indenture, or to reduce the requirements of quorum or change voting
requirements set forth in this Indenture;

(c)                                  modify or
affect in any manner adverse to the Holders the terms and conditions of the
obligations of the Guarantor in respect of the due and punctual payments of
principal and interest;

(d)                                 modify any
of this Section 9.02 or Section 6.07 or any of the provisions relating to the
waiver of certain past defaults or certain covenants, except to increase the
required percentage to effect the action or to provide that certain other
provisions may not be modified or waived without the consent of the Holders of
the Notes;

(e)                                  modify the
provisions of Section 3.05 in a manner adverse to the Holders of the Notes,
including the Issuer’s obligation to repurchase the Notes following a
Fundamental Change; or

(f)                                    adversely
affect the Holders’ rights contained in Section 3.06 and Section 13.01 of this
Indenture.

Upon the written request
of the Issuer, accompanied by a copy of the resolutions of the Board of
Trustees certified by the General Partner’s Secretary or Assistant Secretary
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of Noteholders as aforesaid,
the Trustee shall join with the Issuer and the Guarantor 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 Noteholders under this Section 9.02 to approve the
particular form of any proposed supplemental indenture, but it shall be
sufficient if such consent shall approve the substance thereof.

Section 9.03.                             Effect of
Supplemental Indenture. 
Any supplemental indenture executed pursuant to the provisions of this
Article 9 shall comply with the Trust Indenture Act, as then in effect,
provided that this Section 9.03 shall not require such supplemental indenture
or the Trustee to be qualified under the Trust Indenture Act prior to the time,
if ever, such qualification is in fact required under the terms of the Trust
Indenture Act or the Indenture has been qualified under the Trust Indenture
Act, nor shall it constitute any admission or acknowledgment by any party to
such supplemental indenture that any such qualification is required prior to
the time, if ever, such qualification is in fact required under the terms of
the Trust Indenture Act or the Indenture has been qualified under the Trust
Indenture Act. Upon the execution of any supplemental indenture pursuant to the
provisions of this Article 9, this Indenture shall be and be deemed to be
modified and amended in accordance therewith and the respective rights,
limitation of rights, obligations, duties and immunities under this Indenture
of the Trustee, the Issuer and the Holders of Notes 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.

 46
 

 

Section 9.04.                             Notation on
Notes.  Notes authenticated
and delivered after the execution of any supplemental indenture pursuant to the
provisions of this Article 9 may bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If the
Issuer or the Trustee shall so determine, new Notes so modified as to conform,
in the opinion of the Trustee and the Board of Trustees, to any modification of
this Indenture contained in any such supplemental indenture may, at the Issuer’s
expense, be prepared and executed by the Issuer, authenticated by the Trustee
(or an authenticating agent duly appointed by the Trustee pursuant to Section
16.11) and delivered in exchange for the Notes then outstanding, upon surrender
of such Notes then outstanding.

Section 9.05.                             Evidence of
Compliance of Supplemental Indenture to Be Furnished to Trustee.  Prior to entering into any supplemental
indenture pursuant to this Article 9, the Trustee shall be provided with an
Officers’ Certificate and an Opinion of Counsel as conclusive evidence that any
supplemental indenture executed pursuant hereto complies with the requirements
of this Article 9 and is otherwise authorized or permitted by this Indenture.

ARTICLE 10

CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

Section 10.01.                       Issuer May
Consolidate on Certain Terms. 
Nothing contained in this Indenture or in the Notes shall prevent any
consolidation or merger of the Issuer with or into any other Person or Persons
(whether or not affiliated with the Issuer), or successive consolidations or
mergers in which either the Issuer will be the continuing entity or the Issuer
or its successor or successors shall be a party or parties, or shall prevent
any sale, conveyance, transfer or lease of all or substantially all of the
property of the Issuer, to any other Person (whether or not affiliated with the
Issuer); provided, however,
that the following conditions are met:

(a)                                  the Issuer
shall be the continuing entity, or the successor entity (if other than the
Issuer) formed by or resulting from any consolidation or merger or which shall
have received the transfer of assets shall be an entity organized under the
laws of the United States and shall expressly assume payment of the principal
of and interest on all of the Notes and the due and punctual performance and
observance of all of the covenants and conditions in this Indenture;

(b)                                 if as a
result of such transaction the Notes become exchangeable into common stock or
other securities issued by a third party, such third party fully and
unconditionally guarantees all obligations under the Notes and this Indenture;

(c)                                  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 occurred and be continuing; and

(d)                                 either the
Issuer or the successor Person, in either case, shall have delivered to the
Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that
such consolidation, merger, sale, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such transaction, such
supplemental indenture comply with this Article 10 and that all conditions
precedent herein provided for relating to such transaction have been complied
with.

No such consolidation,
merger, sale, conveyance, transfer or lease shall be permitted by this Section
10.01 unless prior thereto the Guarantor shall have delivered to the Trustee a
Guarantor’s Officers’ Certificate and an Opinion of Counsel, each stating that
the Guarantor’s obligations hereunder shall remain in full force and effect
thereafter.

 47

 

Section 10.02.        Issuer
Successor to Be Substituted.  Upon
any consolidation by the Issuer with or merger of the Issuer into any other
Person or any sale, conveyance, transfer or lease of all or substantially all
of the properties and assets of the Issuer to any Person in accordance with
Section 10.01, the successor Person formed by such consolidation or into which
the Issuer is merged or to which such sale, conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Issuer under this Indenture with the same effect as if such
successor Person had been named as the Issuer herein, and thereafter, except in
the case of a lease, the predecessor Person shall be released from all
obligations and covenants under this Indenture and the Notes.

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

Section 10.03.        Guarantor
May Consolidate on Certain Terms. 
Nothing contained in this Indenture or in the Notes shall prevent any
consolidation or merger of the Guarantor with or into any other Person or
Persons (whether or not affiliated with the Guarantor), or successive
consolidations or mergers in which either the Guarantor will be the continuing
entity or the Guarantor or its successor or successors shall be a party or
parties, or shall prevent any sale, conveyance, transfer or lease of all or
substantially all of the property of the Guarantor, to any other Person
(whether or not affiliated with the Guarantor); provided,
however, that:

(a)           the
Guarantor shall be the continuing entity, or the successor entity (if other
than the Guarantor) formed by or resulting from any consolidation or merger or
which shall have received the transfer of assets shall be an entity organized
under the laws of the United States and shall expressly assume the obligations
of the Guarantor under the Guarantee and the due and punctual performance and
observance of all of the covenants and conditions in this Indenture;

(b)           if as a
result of such transaction the Notes become exchangeable into common stock or
other securities issued by a third party, such third party fully and unconditionally
guarantees all obligations under the Notes and this Indenture;

(c)           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

(d)           each of
the Guarantor and the successor Person has delivered to the Trustee an Officers’
Certificate of the Guarantor and an Opinion of Counsel, each stating that such
consolidation, sale, merger, conveyance, transfer or lease and such
supplemental indenture comply with this Article 10 and that all conditions
precedent herein provided for relating to such transaction have been complied
with.

Section 10.04.        Guarantor
Successor to Be Substituted.  Upon
any consolidation or merger or any sale, conveyance, transfer or lease of all
or substantially all of the properties and assets of the Guarantor to any
Person in accordance with Section 10.04, the successor Person formed by such
consolidation or into which the Guarantor is merged or to which such sale,
conveyance, transfer or lease is made shall succeed to, and be substituted for,
and may exercise every right and power of, the Guarantor under this Indenture
with the same effect as if such successor Person had been named as the Guarantor
herein, and thereafter, except in the case of a lease, the predecessor Person
shall be released from all obligations and covenants under this Indenture.

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

Section 10.05.        Assumption
by Guarantor.  The Guarantor, or a
Subsidiary thereof, may directly assume, by an indenture supplemental hereto, executed
and delivered to the Trustee, in form satisfactory to the Trustee, the due and
punctual payment of the principal of, any premium and interest on all the Notes
and the performance of every covenant of this Indenture on the part of the
Issuer to be performed or observed. Upon any such assumption, the Guarantor or
such Subsidiary shall succeed to, and be substituted for and may exercise every
right and power of, the Issuer under this Indenture with the same effect as if
the Guarantor or such Subsidiary had been named as the Issuer herein and the
Issuer shall be released from all obligations and covenants with respect to the
Notes. No such assumption shall be permitted unless the Guarantor has delivered
to the Trustee (i) an Officers’ Certificate of the Guarantor and an Opinion of
Counsel, each stating that such assumption and supplemental indenture comply
with this Article 10, and that all conditions precedent herein provided for
relating to such transaction have been complied with and that, in the event of
assumption by a Subsidiary, the Guarantee and all other covenants of the
Guarantor herein remain in full force and effect and (ii) an opinion of
independent counsel that the Holders of Notes shall have no materially adverse
United States federal tax consequences as a result of such assumption, and
that, if any Notes are then listed on the New York Stock Exchange, that such
Notes shall not be delisted as a result of such assumption.

ARTICLE 11

SATISFACTION AND DISCHARGE OF INDENTURE

Section 11.01.        Discharge
of Indenture.  This Indenture shall
cease to be of further effect (except as to any surviving rights of exchange,
registration of transfer or exchange of Notes herein expressly provided for and
except as further provided below), and the Trustee, on demand of and at the
expense of the Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when (a) either: (1) all Notes
theretofore authenticated and delivered (other than (i) Notes which have been
destroyed, lost or stolen and which have been replaced or paid as provided in
Section 11.04 and (ii) Notes for whose payment money has theretofore been
deposited in trust and thereafter repaid to the Issuer as provided in Section
11.04) have been delivered to the Trustee for cancellation; or (2) all such
Notes not theretofore delivered to the Trustee for cancellation (i) have become
due and payable, whether at the Maturity Date, Repurchase Date or Fundamental
Change Repurchase Date or upon exchange or otherwise, or (ii) are to be called
for redemption 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
Issuer, and the Issuer, in the case of clause (1) or (2) above, has irrevocably
deposited or caused to be irrevocably deposited with the Trustee a Paying Agent
or the Exchange Agent (other than the Issuer or any of its Affiliates), as
applicable, as trust funds in trust cash and/or Common Shares (as applicable
under the terms of the Indenture) in an amount sufficient to pay and discharge
the entire indebtedness on such Notes not theretofore delivered to the Trustee
for cancellation, for principal and interest to the date of such deposit (in
the case of Notes which have become due and payable) or to the Maturity Date,
Redemption Date, Repurchase Date or Fundamental Change Repurchase Date, as the
case may be; provided, however, that there
shall not exist, on the date of such deposit, a default or Event of Default; provided, further, that such deposit shall not result in a
breach or violation of, or constitute a default under, this Indenture or any
other agreement or instrument to which the Issuer is a party or to which the
Issuer is bound; (b) the Issuer has paid or caused to be paid all other sums
payable hereunder by the Issuer; and (c) the Issuer 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.

 49
 

 

Notwithstanding the
satisfaction and discharge of this Indenture, the obligations of the Issuer to
the Trustee under Section 7.06 shall survive and, if money shall have been
deposited with the Trustee pursuant to subclause (2) of clause (a) of this
Section, the provisions of Sections 2.05, 2.06, 2.07, 3.05, 3.06, 5.01, Article
13 and this Article 11, shall survive until the Notes have been paid in full.

Section 11.02.        Deposited
Monies to Be Held in Trust by Trustee. 
Subject to Section 11.04, all monies deposited with the Trustee pursuant
to Section 7.05 shall be held in trust for the sole benefit of the Noteholders,
and such monies shall be applied by the Trustee to the payment, either directly
or through any Paying Agent (including the Issuer if acting as its own Paying
Agent), to the Holders of the particular Notes for the payment or redemption of
which such monies have been deposited with the Trustee, of all sums due and to
become due thereon for principal, premium, if any, and interest. All moneys
deposited with the Trustee pursuant to Section 7.05 (and held by it or any
Paying Agent) for the payment of Notes subsequently exchanged shall be returned
to the Issuer upon request. The Trustee is not responsible to anyone for
interest on any deposited funds except as agreed in writing.

Section 11.03.        Paying
Agent to Repay Monies Held.  Subject
to the provisions of Section 11.04, the Trustee or a Paying Agent shall hold in
trust, for the benefit of the Noteholders, all money deposited with it pursuant
to Section 11.01 and shall apply the deposited money in accordance with this
Indenture and the Notes to the payment of the principal of (including the
Redemption Price or repurchase price upon redemption or repurchase pursuant to
Article 3) and interest on the Notes.

Section 11.04.        Return
of Unclaimed Monies.  The Trustee and
each Paying Agent shall pay to the Issuer upon request any money held by them
for the payment of principal or interest that remains unclaimed for two years after
a right to such money has matured; provided, however, that
the Trustee or such Paying Agent, before being required to make any such
payment, may, at the expense of the Issuer, either publish in a newspaper of
general circulation in The City of New York, or cause to be mailed to each
Holder entitled to such money, notice that such money remains unclaimed and
that after a date specified therein, which shall be at least thirty (30)
calendar days from the date of such mailing or publication, any unclaimed balance
of such money then remaining will be repaid to the Issuer. After payment to the
Issuer, Holders entitled to money must look to the Issuer for payment as
general creditors unless an applicable abandoned property law designates
another person, and the Trustee and each Paying Agent shall be relieved of all
liability with respect to such money.

Section 11.05.        Reinstatement.  If the Trustee or the Paying Agent is unable
to apply any money in accordance with Section 11.02 by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Issuer’s obligations under this
Indenture and the Notes shall be revived and reinstated as though no deposit
had occurred pursuant to Section 11.01 until such time as the Trustee or the
Paying Agent is permitted to apply all such money in accordance with Section
11.02; provided that if the Issuer makes any
payment of principal of or interest on any Note following the reinstatement of
its obligations, the Issuer shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money held by the Trustee or Paying
Agent.

ARTICLE 12

IMMUNITY OF INCORPORATORS, SHAREHOLDERS, OFFICERS AND TRUSTEES

Section 12.01.        Indenture
and Notes Solely Corporate Obligations. 
Except as otherwise expressly provided in Article 15, no recourse for
the payment of the principal of (including the Redemption Price or repurchase
price upon redemption or repurchase pursuant to Article 3) or, premium, if any,
or interest on any Note, or for any claim based thereon or otherwise in respect
thereof, and no recourse under or upon any obligation, covenant or agreement of
the Issuer in this Indenture or in any 

 50
 

 

supplemental
indenture or in any Note, or because of the creation of any indebtedness
represented thereby, shall be had against any incorporator, shareholder,
partner, member, manager, employee, agent, officer, trustee or subsidiary, as
such, past, present or future, of the General Partner, the Issuer or any of the
Issuer’s subsidiaries or of any successor thereto, either directly or through
the Issuer or any of the Issuer’s subsidiaries or any successor thereto,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being expressly
understood that all such liability is hereby expressly waived and released as a
condition of, and as a consideration for, the execution of this Indenture and
the issue of the Notes.

ARTICLE 13

EXCHANGE OF NOTES

Section 13.01.        Exchange.

(a)   Subject to
the conditions described in clauses (b) through (f) below and to Section
13.10, and upon compliance with the provisions of this Article 7, a
Noteholder shall have the right, at such Noteholder’s option, to exchange all
or any portion (if the portion to be exchanged is $1,000 principal amount or an
integral multiple thereof) of such Notes at any time prior to the Close of
Business on the scheduled Trading Day immediately preceding September 20, 2011
at a rate (the “Exchange Rate”) of Common Shares
(subject to adjustment by the Issuer as provided in Section 13.03) per $1,000
principal amount Note (the “Exchange Obligation”)
under the circumstances and during the periods set forth below.  On and after September 20, 2011, regardless
of the conditions described in clause (b) through (f) below, upon
compliance with the provisions of this Article 7 and subject to Section
13.10, a Noteholder shall have the right, at such Noteholder’s option, to
exchange all or any portion (if the portion to be exchanged is $1,000 principal
amount or an integral multiple thereof) of such Note at any time prior to the
Close of Business on the scheduled Trading Day immediately preceding the
Maturity Date.

(b)   A
Noteholder shall have the right, at such Noteholder’s option, to exchange its
Notes prior to September 20, 2011, during the five Business Day period
immediately after any 10 consecutive Trading Day period (the “Measurement Period”) in which the Trading Price per $1,000
principal amount of Notes for each day of such Measurement Period was less than
98% of the product of the Last Reported Sale Price of the Common Shares on such
date and the Exchange Rate on such date, all as determined by the Trustee
(except the Trading Price).  The Trustee
shall have no obligation to determine the Trading Price of the Notes.  The Issuer shall request that a third-party
nationally recognized financial institution authorized to do business in the
United States of America other than the Trustee (the “Third-Party
Financial Institution”), determine the Trading Price of the Notes
and provide such determination to both the Issuer and the Trustee in writing; provided that the Issuer shall have no obligation to make
such request unless a Noteholder or group of Noteholders representing at least
$1,000,000 aggregate principal amount of Notes provides the Issuer with
reasonable evidence that the Trading Price per $1,000 principal amount of the
Notes would be less than 98% of the product of the Last Reported Sale Price at
such time and the then-applicable Exchange Rate, at which time the Issuer
shall instruct the Third-Party Financial Institution to determine the
Trading Price of the Notes beginning on the next Trading Day and on each
successive Trading Day until the Trading Price per $1,000 principal amount of
the Notes is greater than or equal to 98% of the product of the Last Reported
Sale Price on such date and the then-applicable Exchange Rate.  If the Trading Price condition set forth
above has been met, the Issuer shall so notify the Noteholders.  If at any time after the Trading Price
condition set forth above has been met, the Trading Price per $1,000 principal
amount of Notes is greater than 98% of the product of the Last Reported Sale
Price on such date and the then-applicable Exchange Rate, the Issuer
shall so notify the Noteholders.

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(c)   A
Noteholder shall have the right, at such Noteholder’s option, to exchange Notes
during any calendar quarter after the quarter ended September 30, 2006,
and only during such calendar quarter, if the Last Reported Sale Price for the
Common Shares for at least 20 Trading Days during the period of 30 consecutive
Trading Days ending on the last Trading Day of the previous calendar quarter
exceeds 130% of the Exchange Price (the “Exchange Trigger Price”)
on such last Trading Day, which Exchange Price shall be subject to adjustment
in accordance with this Article 7. 
The Issuer shall employ a Third-Party Financial Institution to
determine at the beginning of each calendar quarter whether the Notes are
exchangeable as a result of the price of Common Shares, and such Third-Party
Financial Institution shall notify the Issuer and Trustee of its determination.

(d)   In the
event that the Issuer has delivered a notice of redemption in accordance with
Section 1104 of the Original Indenture and Section 3.03 of this
Indenture to the Noteholders, a Noteholder may exchange Notes at any time prior
to the Close of Business on the second Business Day immediately preceding the
corresponding Redemption Date; provided, however, that a Noteholder who has delivered a Fundamental
Change Repurchase Notice with respect to a Note may not exchange such Note
until the Noteholder has withdrawn the Fundamental Change Repurchase Notice in
accordance with the terms of the Note and this Indenture.

(e)           (i)  In
the event that the Issuer or the Guarantor elects to:

(A)  distribute
to all or substantially all holders of Common Shares rights entitling them to
purchase, for a period expiring within 60 days after the Record Date for
such distribution, Common Shares at a price less than the Last Reported Sale
Price of the Common Shares for the Trading Day immediately preceding the
declaration date of such distribution; or

(B)   distribute
to all or substantially all holders of Common Shares, assets or debt securities
of the Issuer or the Guarantor or rights to purchase the Issuer’s or the
Guarantor’s securities, which distribution has a per share value (as determined
by the Board of Trustees) exceeding 15% of the Last Reported Sale Price of the
Common Shares on the day immediately preceding the date of declaration of such
distribution,

then, in either case, Noteholders may surrender the Notes for exchange
at any time on and after the date that the Issuer provides notice to Noteholders
referred to in the next sentence until the earlier of the Close of Business on
the Business Day immediately preceding the Ex-Dividend Date for such
distribution or the date the Issuer announces that such distribution will not
take place.  The Issuer shall notify
Noteholders of any distribution referred to in either clause (A) or
clause (B) above and of the resulting exchange right no later than the
tenth Business Day prior to the Ex-Dividend Date for such distribution.

(ii)           If
the Issuer is a party to any transaction or event that constitutes a
Fundamental Change, a Noteholder may surrender Notes for exchange at any time
from and after the 30th scheduled Trading Day prior to the anticipated
Effective Date of such transaction or event until the related Fundamental
Change Repurchase Date and, upon such surrender in connection with a
Fundamental Change occurring prior to September 20, 2011, the Noteholder shall
be entitled to the increase in the Exchange Rate, if any, specified in Section
13.01(g).  The Issuer shall give notice
to all record Noteholders and the Trustee no later than 30 scheduled Trading
Days prior to the anticipated Effective Date of such transaction and issue a
press release of the Fundamental Change no later than 45 scheduled Trading Days
prior to the anticipated effective date of the Fundamental Change.

(iii)          If
the Guarantor is a party to a consolidation, merger, binding share exchange
(including, without limitation, by way of a recapitalization, relcassification
or change of the 

 52
 

 

Common Shares (other than changes
resulting from a subdivision or combination))or sale or conveyance of all or
substantially all of its properties and assets, in each case pursuant to which
the Common Shares would be converted into cash, securities and/or other
property, then the Noteholders shall have the right to exchange Notes at any
time beginning 15 calendar days prior to the date announced by the Issuer as
the anticipated effective date of the transaction and until and including the
date that is 15 calendar days after the date that is the effective date of such
transaction; provided such transaction does
not otherwise constitute a Fundamental Change to which the provisions of
Section 13.01(e)(ii) shall apply.  The
Issuer will notify Noteholders at least 20 calendar days prior to the
anticipated effective date of such transaction. 
If the Board of Trustees determines the anticipated effective date of
the transaction, such determination shall be conclusive and binding on the
Noteholders.

(f)    The Notes
shall be exchangeable at any time beginning on the first Business Day after any
30 consecutive Trading Day period during which Common Shares are not listed or
quoted on a U.S. national securities exchange.

(g)   (i)  If
a Noteholder elects to exchange Notes in connection with a Fundamental Change
that occurs prior to September 20, 2011, the Exchange Rate applicable to
each $1,000 principal amount of Notes so exchanged shall be increased by an
additional number of Common Shares (the “Additional Shares”)
as described below.  Settlement of Notes
tendered for exchange to which Additional Shares shall be added to the Exchange
Rate as provided in this subsection shall be settled pursuant to Section 13.02
below, as applicable.  For purposes of
this Section 13.01(g), an exchange shall be deemed to be “in connection with” a
Fundamental Change to the extent that the related exchange notice is delivered
during the time period beginning on the 30th Trading Day prior to the
anticipated Effective Date of such Fundamental Change and ending on the related
Fundamental Change Repurchase Date, inclusive (regardless of whether the
provisions of clauses (b), (c), (d), (e) or (f) of this Section 13.01
shall apply to such exchange).  Such
exchange notice shall indicate that the Noteholder has elected to exchange
Notes in connection with a Fundamental Change; provided,
however, that the failure to so indicate
shall not in any way affect the Exchange Obligation or the right of such
Noteholder to receive Additional Shares in connection with such exchange.

(ii)           The
number of Additional Shares by which the Exchange Rate will be increased shall
be determined by reference to the table attached as Schedule A hereto,
based on the date on which the Fundamental Change occurs or becomes effective
(the “Effective Date”), and the Share Price;
provided, that if the Share Price is
between two Share Price amounts in the table or the Effective Date is between
two Effective Dates in the table, the number of Additional Shares shall be
determined by a straight-line interpolation between the number of
Additional Shares set forth for the next higher and next lower Share Price
amounts and the two nearest Effective Dates, as applicable, based on a 365-day
year; provided further that if (1) the
Share Price is greater than $120.00 per Common Share (subject to adjustment in
the same manner as set forth in Section 13.03), no Additional Shares will be
added to the Exchange Rate, and (2) the Share Price is less than $45.25
per share (subject to adjustment in the same manner as set forth in Section
13.03), no Additional Shares will be added to the Exchange Rate.  Notwithstanding the foregoing, in no event
will the total number of Common Shares issuable upon exchange exceed 22.0962
shares per $1,000 principal amount of Notes (subject to adjustment in the same
manner as set forth in Section 13.03).

(iii)          The
Share Prices set forth in the first row of the table in Schedule A hereto
shall be adjusted as of any date on which the Exchange Rate of the Notes is
adjusted.  The adjusted Share Prices
shall equal the Share Prices applicable immediately prior to such adjustment, 

 53
 

 

multiplied by a fraction, the
numerator of which is the Exchange Rate in effect immediately prior to the
adjustment giving rise to the Share Price adjustment and the denominator of
which is the Exchange Rate as so adjusted. 
The number of Additional Shares within the table shall be adjusted in
the same manner as the Exchange Rate as set forth in Section 13.03 (other than
by operation of an adjustment to the Exchange Rate by adding Additional
Shares).

Section 13.02.        Exchange
Procedures.

(a)   Subject to
Section 13.02(b) and Section 13.11, the Issuer will satisfy the Exchange
Obligation with respect to each $1,000 principal amount of Notes validly
tendered for exchange in cash, fully paid Common Shares or a combination
thereof, as applicable, by delivering, on the third Trading Day immediately
following the last day of the related Observation Period, cash, Common Shares
or a combination thereof, as applicable, equal to the sum of the Daily
Settlement Amounts for each of the 20 Trading Days during the related
Observation Period; provided that
(i) the Issuer will deliver cash in lieu of fractional Common Shares as
set forth pursuant to clause (m) below; (ii) if the Issuer elects to
settle an exchange of notes only in Common Shares, such settlement will occur
as soon as practicable after the Issuer notifies the Noteholders that it has
chosen such method of settlement, but in any event within three Business Days
of the relevant Exchange Date; and (iii) the Issuer will inform exchanging
Noteholders by notice to the Trustee no later than two Trading Days beginning
on and including the Exchange Date if the Issuer elects to pay cash upon
exchange of the Notes and will specify in such notice the amount or percentage
of Notes for which cash will be paid; provided that
the Issuer may provide that the Specified Amount or Specified Percentage for
any Trading Day will not be in excess of the Daily Exchange Value.  The Daily Settlement Amounts shall be
determined by the Issuer promptly following the last day of the Observation
Period.

(b)   Notwithstanding
Section 13.02(a), the Issuer shall satisfy the Exchange Obligation with respect
to each $1,000 principal amount of Notes tendered for exchange to which
Additional Shares shall be added to the Exchange Rate as set forth in Section
13.01(g) pursuant to this clause (b).

(i)            If
the last day of the applicable Observation Period related to Notes surrendered
for exchange is prior to the third Trading Day preceding the Effective Date of
the Fundamental Change, the Issuer will satisfy the related Exchange Obligation
with respect to each $1,000 principal amount of Notes tendered for exchange as
described in Section 13.02(b)(ii) by delivering the amount of cash, Common
Shares or a combination thereof, as applicable (based on the Exchange Rate, but
without regard to the number of Additional Shares to be added to the Exchange
Rate pursuant to Section 13.01(g)) on the third Trading Day immediately
following the last day of the applicable Observation Period.  As soon as practicable following the
Effective Date of the Fundamental Change, the Issuer will deliver the increase
in such amount of cash and Reference Property deliverable in lieu of Common
Shares, if any, as if the Exchange Rate had been increased by such number of
Additional Shares during the related Observation Period (and based upon the
related Last Reported Sale Prices during such Observation Period).  If such increased amount of cash and shares,
if any, results in an increase to the amount of cash to be paid to Noteholders,
the Issuer will pay such increase in cash, and if such increased amount results
in an increase to the number of Common Shares, the Issuer will deliver such
increase by delivering Reference Property based on such increased number of
shares.

(ii)           If
the last day of the applicable Observation Period related to Notes surrendered
for exchange is on or following the third scheduled Trading Day preceding the
Effective Date of such Fundamental Change, the Issuer will satisfy the Exchange
Obligation with respect to each $1,000 principal amount of Notes tendered for
exchange as described in Section 13.01(e)(i) (based on the Exchange Rate as
increased by the Additional Shares pursuant to Section 13.01(g) 

 54
 

 

above) on the later to occur of
(x) the Effective Date of the Fundamental Change and (y) the third
Trading Day immediately following the last day of the applicable Observation
Period.

(c)   Before any
holder of a Note shall be entitled to exchange the same as set forth above,
such holder shall (1) in the case of a Global Note, comply with the
procedures of the Depositary in effect at that time and, if required, pay funds
equal to interest payable on the next Interest Payment Date to which such holder
is not entitled as set forth in Section 13.02(i) and, if required, pay all
taxes or duties, if any, and (2) in the case of a Note issued in
certificated form, (a) complete and manually sign and deliver an
irrevocable written notice to the Exchange Agent in the form on the reverse of
such certificated Note (or a facsimile thereof) (a “Notice of
Exchange”) at the office of the Exchange Agent and shall state in
writing therein the principal amount of Notes to be exchanged and the name or
names (with addresses) in which such holder wishes the certificate or
certificates for any Common Shares, if any, to be delivered upon settlement of
the Exchange Obligation to be registered, (b) surrender such Notes, duly
endorsed to the Issuer or in blank (and accompanied by appropriate endorsement
and transfer documents), at the office of the Exchange Agent, (c) if
required, pay funds equal to interest payable on the next Interest Payment Date
to which such holder is not entitled as set forth in Section 13.02(i), and (d) if
required, pay all taxes or duties, if any. 
A Note shall be deemed to have been exchanged immediately prior to the
Close of Business on the Trading Day (the “Exchange Date”)
that the Noteholder has complied with the requirements set forth in this Section
13.02(c).

No Notice of Exchange
with respect to any Notes may be tendered by a holder thereof if such holder
has also tendered a Put Right Repurchase Notice or a Fundamental Change
Repurchase Notice and not validly withdrawn such Put Right Repurchase Notice or
Fundamental Change Repurchase Notice in accordance with the applicable
provisions of Section 8.01 or 8.02, as the case may be.

If more than one Note
shall be surrendered for exchange at one time by the same holder, the Exchange
Obligation with respect to such Notes, if any, that shall be payable upon
exchange shall be computed on the basis of the aggregate principal amount of
the Notes (or specified portions thereof to the extent permitted thereby) so
surrendered.

(d)   Delivery of
the amounts owing in satisfaction of the Exchange Obligation shall be made by
the Issuer in no event later than the date specified in Section 13.02(a),
except to the extent specified in Section 13.02(b).  The Issuer shall make such delivery by paying
the cash amount owed to the Exchange Agent or to the Holder of the Note
surrendered for exchange, or such Holder’s nominee or nominees, and by issuing,
or causing to be issued, and delivering to the Exchange Agent or to such
Holder, or such Holder’s nominee or nominees, certificates or a book-entry
transfer through the Depositary for the number of full Common Shares to which
such Holder shall be entitled as part of such Exchange Obligation (together
with any cash in lieu of fractional shares).

(e)   In case any
Note shall be surrendered to the Trustee for partial exchange (along with, if
the Issuer or the Trustee so requires, due endorsements from such Holder, or
written instruments of transfer in form satisfactory to the Issuer and the
Trustee duly executed by the Holder thereof or his attorney-in-fact),
the Issuer shall execute and the Trustee shall authenticate and deliver to or
upon the written order of the Holder of the Note so surrendered, without charge
to such Holder, a new Note or Notes containing identical terms and conditions
to the Outstanding Notes in authorized denominations in an aggregate principal
amount equal to the unexchanged portion of the surrendered Note.

(f)    If a
Noteholder submits a Note for exchange, the Issuer shall pay all documentary,
stamp and other duties, if any, which may be imposed by the United States or
any political subdivision thereof or taxing authority thereof or therein with
respect to the issuance of Common Shares, if any, upon the exchange.  However, the Noteholder shall pay any such
tax that is due because the Noteholder requests 

 55
 

 

any
Common Shares to be issued in a name other than the Noteholder’s name.  The Exchange Agent may refuse to deliver the
certificates representing the Common Shares being issued in a name other than
the Noteholder’s name until the Trustee receives a sum sufficient to pay any
tax which will be due because the shares are to be issued in a name other than
the Noteholder’s name.  The Exchange
Agent may refuse to deliver the certificates representing the Common Shares
being issued in a name other than the holder’s name until the Trustee receives
a sum sufficient to pay any tax which will be due because the shares are to be
issued in a name other than the holder’s name. 
Nothing herein shall preclude any tax withholding required by law or
regulations.

(g)   Except as
provided in Section 13.03, no adjustment shall be made for dividends on any
shares issued upon the exchange of any Note as provided in this Article.

(h)   Upon the
exchange of an interest in a Global Note, the Trustee shall make a notation on
such Global Note as to the reduction in the principal amount represented
thereby.  The Issuer shall notify the
Trustee in writing of any exchange of Notes effected through any Exchange Agent
other than the Trustee.

(i)    Upon exchange,
a Noteholder will not receive any separate cash payment for accrued and unpaid
interest, except as set forth below.  The
Issuer’s settlement of its Exchange Obligation as described above shall be
deemed to satisfy its obligation to pay the principal amount of the Note and
accrued and unpaid interest to, but not including, the Exchange Date.  As a result, accrued and unpaid interest to,
but not including, the Exchange Date shall be deemed to be paid in full rather
than cancelled, extinguished or forfeited. 
Notwithstanding the preceding sentence, if Notes are exchanged after the
Close of Business on a Record Date, Holders of such Notes as of the Close of
Business on the Record Date will receive the interest payable on such Notes on
the corresponding Interest Payment Date notwithstanding the exchange.  Notes surrendered for exchange during the
period from the Close of Business on any regular Record Date to the opening of
business on the corresponding Interest Payment Date must be accompanied by
payment of an amount equal to the interest payable on the Notes so exchanged; provided, however, that
no such payment need be made (1) if the Issuer has called the Notes for
redemption or (2) to the extent of any overdue interest existing at the
time of exchange with respect to such Note. 
Except as described above, no payment or adjustment will be made for
accrued interest on exchanged Notes.

(j)    The Person
in whose name the certificate for any Common Shares issued upon exchange is
registered shall be treated as a holder of such Common Shares of record on and
after the Exchange Date; provided, however, that no surrender of Notes on any date when the
share transfer books of the Issuer shall be closed shall be effective to
constitute the Person or Persons entitled to receive the Common Shares upon
such exchange as the record holder or holders of such Common Shares on such
date, but such surrender shall be effective to constitute the Person or Persons
entitled to receive such Common Shares as the record holder or holders thereof
for all purposes at the Close of Business on the next succeeding day on which
such share transfer books are open; such exchange shall be at the Exchange Rate
in effect on the date that such Notes shall have been surrendered for exchange,
as if the share transfer books of the Issuer had not been closed.  Upon exchange of Notes, such Person shall no
longer be a Noteholder.

(k)   Notwithstanding
any other provision of the Notes, no Noteholder shall be entitled to exchange
such Notes for Common Shares if and to the extent that the Issuer has not
received such Common Shares from the Guarantor. 
If the Issuer is unable to deliver shares to any Noteholder as described
above, the Issuer will at the Issuer’s option either pay cash to such
Noteholder in lieu of the Common Shares otherwise deliverable, or issue to such
Noteholder a number of the Issuer’s Common Units equal to the shortfall in the
number of Common Shares otherwise deliverable, with such Common Units having
all the rights and privileges provided in the Issuer’s declaration of trust as
in effect on the date of issuance of such Common Units including the right by,
and at the Guarantor’ election, to have 

 56
 

 

such
units redeemed for cash in an amount equal to the fair market value of an equal
number of Common Shares or for an equal number of Common Shares.

(l)            The
Issuer may elect to pay cash to the Noteholders in lieu of all or a portion of
the Common Shares otherwise issuable pursuant to this Article 7. In such event,
on any day prior to the first Trading Day of the applicable Observation Period,
the Issuer shall specify a percentage of the Daily Share Amount that shall be
settled in cash (the “Cash Percentage”)
and the amount of cash that the Issuer shall pay in respect of each Trading Day
in the applicable Observation Period will equal the product of: (1) the Cash
Percentage, (2) the Daily Share Amount for such Trading Day and (3) the Last
Reported Sale Price for Common Shares for such Trading Day (provided that after
the consummation of a Fundamental Change in which the consideration is
comprised entirely of cash, the amount used in this clause (3) shall be the
cash price per share received by holders of the Common Shares in such
Fundamental Change). The number of Common Shares that the Issuer shall deliver
in respect of each Trading Day in the applicable Observation Period will be a
percentage of the Daily Share Amount equal to 100% minus the Cash Percentage.
Upon making a determination that a percentage of the Daily Share Amount will be
settled in cash, the Issuer shall promptly notify Noteholders of such Cash
Percentage by notifying the Trustee (the “Cash Percentage Notice”).
If the Issuer does not specify a Cash Percentage by the close of business on
the Trading Day prior to the scheduled first Trading Day of the applicable
Observation Period, the Issuer shall settle 100% of the Daily Share Amount for
each Trading Day in the applicable Observation Period with Common Shares; provided, however, that
the Issuer shall pay cash in lieu of fractional shares otherwise issuable upon
exchange of Notes. The Issuer at its option, may revoke any Cash Percentage
Notice by notifying the Trustee; provided, that
the Issuer shall revoke such notice by the close of business on the Trading Day
prior to the scheduled first Trading Day of the applicable Observation Period.

(m)  No
fractional Common Shares shall be issued upon exchange of any Note or
Notes.  If more than one Note shall be
surrendered for exchange at one time by the same Noteholder, the number of full
shares that shall be issued upon exchange thereof shall be computed on the
basis of the aggregate principal amount of the Notes (or specified portions
thereof) so surrendered.  Instead of any
fractional Common Share that would otherwise be issued upon exchange of any
Note or Notes (or specified portions thereof), the Issuer shall pay a cash
adjustment in respect of such fraction (calculated to the nearest one-100th
of a share) in an amount equal to the same fraction of the Last Reported Sale
Price of the Common Shares on the last day of the applicable Observation
Period.

Section 13.03.        Adjustment
of Exchange Rate.  The Exchange Rate
shall be adjusted from time to time by the Issuer as follows:

(a)   In case the
Guarantor shall issue Common Shares as a dividend or distribution to holders of
the outstanding Common Shares, or shall effect a subdivision into a greater
number of Common Shares or combination into a lower number of Common Shares,
the Exchange Rate shall be adjusted based on the following formula:

	
  ER’

  	
  =

  	
  ER0

  	
  x

  	
  OS’

  
	
   

  	
   

  	
   

  	
   

  	
  OS0

  

 

Where

	
  ER0

  	
  =

  	
  the Exchange Rate in effect immediately prior to
  such event;

  
	
   

  	
   

  	
   

  
	
  ER’

  	
  =

  	
  the Exchange Rate in effect immediately after such
  event;

  
	
   

  	
   

  	
   

  
	
  OS0

  	
  =

  	
  the number of Common Shares outstanding immediately
  prior to such event; and

  

 

 57
 

 

 

	
  OS’

  	
  =

  	
  the number of Common
  Shares outstanding immediately after such event.

  

 

Such adjustment shall
become effective immediately after 9:00 a.m., New York City time, on the
Business Day following the Record Date fixed for such determination.  If any dividend or distribution of the type
described in this Section 13.03(a) is declared but not so paid or made, or the
outstanding Common Shares are not subdivided or combined, as the case may be,
the Exchange Rate shall be immediately readjusted, effective as of the date the
Board of Trustees determines not to pay such dividend or distribution, or
subdivide or combine the outstanding Common Shares, as the case may be, to the
Exchange Rate that would then be in effect if such dividend, distribution,
subdivision or combination had not been declared.

(b)   In case the
Guarantor shall issue to all or substantially all holders of its outstanding
Common Shares rights, warrants or convertible securities entitling them (for a
period expiring within 60 calendar days after the issuance thereof) to
subscribe for or purchase Common Shares at a price per share less than the Last
Reported Sale Price of the Common Shares on the Business Day immediately
preceding the date of announcement of such issuance, the Exchange Rate shall be
adjusted based on the following formula:

	
  ER’

  	
  =

  	
  ER0

  	
  x

  	
  OS0 + X

  
	
   

  	
   

  	
   

  	
   

  	
  OS0 + Y

  

 

where

	
  ER0

  	
  =

  	
  the Exchange Rate in effect immediately prior to
  such event;

  
	
   

  	
   

  	
   

  
	
  ER’

  	
  =

  	
  the Exchange Rate in effect immediately after such
  event;

  
	
   

  	
   

  	
   

  
	
  OS0

  	
  =

  	
  the number of Common Shares outstanding immediately
  prior to such event;

  
	
   

  	
   

  	
   

  
	
  X

  	
  =

  	
  the total number of Common Shares issuable pursuant
  to such rights, warrants or convertible securities; and

  
	
   

  	
   

  	
   

  
	
  Y

  	
  =

  	
  the number of Common Shares equal to the aggregate
  price payable to exercise such rights, warrants or convertible securities divided
  by the average of the Last Reported Sale Prices of Common Shares over the 10
  consecutive Trading Day period ending on the Business Day immediately
  preceding the Record Date (or, if later, the Ex-Dividend Date) for the
  issuance of such rights, warrants or convertible securities.

  

 

Such adjustment shall be
successively made whenever any such rights, warrants or convertible securities
are issued and shall become effective immediately after 9:00 a.m., New
York City time, on the Business Day following the date fixed for such
determination.  If such rights, warrants
or convertible securities are not so exercised prior to their expiration, the
Exchange Rate shall again be adjusted to be the Exchange Rate that would then be
in effect if such Record Date for such distribution had not been fixed.

In determining whether
any rights, warrants or convertible securities entitle the holders to subscribe
for or purchase Common Shares at less than such Last Reported Sale Price, and
in determining the aggregate offering price of such Common Shares, there shall
be taken into account any consideration received by the Guarantor for such
rights, warrants or convertible securities and any amount payable on exercise
or exchange thereof, the value of such consideration, if other than cash, to be
determined by the Board of Trustees.

 58
 

 

(c)   In case the
Guarantor shall, by dividend or otherwise, distribute to all or substantially
all holders of its Common Shares any class of beneficial interest of the
Guarantor (other than Common Shares as covered by Section 13.03(a)), evidences
of its indebtedness or other assets or property of the Guarantor (including
securities, but excluding dividends, distributions, rights and warrants covered
by Section 13.03(a), Section 13.03(b) or Section 13.03(d) and distributions
described below in this paragraph (c) with respect to Spin-Offs)
(any of such shares of beneficial interest, indebtedness, or other asset or
property hereinafter in this Section 13.03(c) called the “Distributed
Property”), then, in each such case the Exchange Rate shall be
adjusted based on the following formula:

	
  ER’

  	
  =

  	
  ER0

  	
  x

  	
  SP0

  
	
   

  	
   

  	
   

  	
   

  	
  SP0 – FMV

  

 

Where

	
  ER0

  	
  =

  	
  the Exchange Rate in effect immediately prior to
  such distribution;

  
	
   

  	
   

  	
   

  
	
  ER’

  	
  =

  	
  the Exchange Rate in effect immediately after such
  distribution;

  
	
   

  	
   

  	
   

  
	
  SP0

  	
  =

  	
  the average of the Last Reported Sale Prices of the
  Common Shares over the 10 consecutive Trading Day period ending on the
  Business Day immediately preceding the Record Date for such distribution (or,
  if earlier, the Ex-Dividend Date); and

  
	
   

  	
   

  	
   

  
	
  FMV

  	
  =

  	
  the fair market value (as determined by the Board of
  Trustees) of the shares of beneficial interest, evidences of indebtedness,
  assets or property distributed with respect to each outstanding Common Share
  on the Record Date for such distribution (or, if earlier, the Ex-Dividend
  Date).

  

 

Such adjustment shall
become effective immediately prior to 9:00 a.m., New York City time, on
the Business Day following the date fixed for the determination of shareholders
entitled to receive such distribution; provided that
if the then fair market value (as so determined) of the portion of the
Distributed Property so distributed applicable to one Common Share is equal to
or greater than SP0 as
set forth above, in lieu of the foregoing adjustment, adequate provision shall
be made so that each Noteholder shall have the right to receive, for each
$1,000 principal amount of Notes upon exchange, the amount of Distributed
Property such Noteholder would have received had such Noteholder owned a number
of Common Shares equal to the Exchange Rate on the Record Date.  If such dividend or distribution is not so
paid or made, the Exchange Rate shall again be adjusted to be the Exchange Rate
that would then be in effect if such dividend or distribution had not been
declared.  If the Board of Trustees
determines the fair market value of any distribution for purposes of this
Section 13.03(c) by reference to the actual or when issued trading market for
any securities, it must in doing so consider the prices in such market over the
same period used in determining SP0 above.

With respect to an
adjustment pursuant to this Section 13.03(c) where there has been a payment of
a dividend or other distribution on the Common Shares of or other beneficial
interests in the Guarantor, or on any class or series of stock of or similar
beneficial interest in or relating to a Subsidiary or other business unit
thereof (a “Spin-Off”), the Exchange
Rate in effect immediately before 5:00 p.m., New York City time, on the
Record Date fixed for determination of shareholders entitled to receive the
distribution will be increased based on the following formula:

	
  ER’

  	
  =

  	
  ER0

  	
  x

  	
  FMV0 + MP0

  
	
   

  	
   

  	
   

  	
   

  	
  MP0

  

 59
 

 

Where

	
  ER0

  	
  =

  	
  the Exchange Rate in
  effect immediately prior to such distribution;

  
	
   

  	
   

  	
   

  
	
  ER’

  	
  =

  	
  the Exchange Rate in
  effect immediately after such distribution;

  
	
   

  	
   

  	
   

  
	
  FMV0

  	
  =

  	
  the average of the Last
  Reported Sale Prices of the beneficial interests distributed to holders of
  Common Shares applicable to one Common Share over the first 10 consecutive
  Trading Day period after the effective date of the Spin-Off; and

  
	
   

  	
   

  	
   

  
	
  MP0

  	
  =

  	
  the average of the Last
  Reported Sale Prices of Common Shares over the first 10 consecutive Trading
  Day period after the effective date of the Spin-Off.

  

 

Such adjustment shall
occur on the tenth Trading Day from, and including, the effective date of the
Spin-Off; provided that in respect of any
exchange within the 10 Trading Days following any Spin-Off, references
within this paragraph (c) to 10 days shall be deemed replaced with such
lower number of Trading Days as have elapsed between such Spin-Off and
the Exchange Date in determining the applicable Exchange Rate.

Rights or warrants
distributed by the Guarantor to all holders of Common Shares, entitling the
holders thereof to subscribe for or purchase shares of the Guarantor’s
beneficial interests, including Common Shares (either initially or under
certain circumstances), which rights or warrants, until the occurrence of a
specified event or events (“Trigger Event”):  (i) are deemed to be transferred with
such Common Shares; (ii) are not exercisable; and (iii) are also
issued in respect of future issuances of Common Shares, shall be deemed not to
have been distributed for purposes of this Section 13.03(c) (and no adjustment
to the Exchange Rate under this Section 13.03(c) will be required) until the
occurrence of the earliest Trigger Event, whereupon such rights and warrants
shall be deemed to have been distributed and an appropriate adjustment (if any
is required) to the Exchange Rate shall be made under this Section
13.03(c).  If any such right or warrant,
including any such existing rights or warrants distributed prior to the date of
this Indenture, are subject to events, upon the occurrence of which such rights
or warrants become exercisable to purchase different securities, evidences of
indebtedness or other assets, then the date of the occurrence of any and each
such event shall be deemed to be the date of distribution and Record Date with
respect to new rights or warrants with such rights (and a termination or
expiration of the existing rights or warrants without exercise by any of the
holders thereof).  In addition, in the
event of any distribution (or deemed distribution) of rights or warrants, or
any Trigger Event or other event (of the type described in the preceding
sentence) with respect thereto that was counted for purposes of calculating a
distribution amount for which an adjustment to the Exchange Rate under this
Section 13.03 was made, (1) in the case of any such rights or warrants
that shall all have been redeemed or repurchased without exercise by any
holders thereof, the Exchange Rate shall be readjusted upon such final
redemption or repurchase to give effect to such distribution or Trigger Event,
as the case may be, as though it were a cash distribution, equal to the per
share redemption or repurchase price received by a holder or holders of Common
Shares with respect to such rights or warrants (assuming such holder had
retained such rights or warrants), made to all holders of Common Shares as of
the date of such redemption or repurchase, and (2) in the case of such
rights or warrants that shall have expired or been terminated without exercise
by any holders thereof, the Exchange Rate shall be readjusted as if such rights
and warrants had not been issued.

For purposes of this
Section 13.03(c), Section 13.03(a) and Section 13.03(b), any dividend or
distribution to which this Section 13.03(c) is applicable that also includes
Common Shares to which Section 13.03(a) applies or rights or warrants to
subscribe for or purchase Common Shares to which Section 13.03(b) applies (or both),
shall be deemed instead to be (1) a dividend or distribution of the
evidences of indebtedness, assets or shares of beneficial interests other than
such Common Shares or 

 60
 

 

rights or
warrants to which Section 13.03(c) applies (and any Exchange Rate adjustment
required by this Section 13.03(c) with respect to such dividend or distribution
shall then be made) immediately followed by (2) a dividend or distribution
of such Common Shares or such rights or warrants (and any further Exchange Rate
adjustment required by Section 13.03(a) and Section 13.03(b) with respect to
such dividend or distribution shall then be made), except (A) the Record
Date of such dividend or distribution shall be substituted as “the Record Date”
and “the date fixed for such determination” within the meaning of Section
13.03(a) and Section 13.03(b) and (B) any Common Shares included in such
dividend or distribution shall not be deemed “outstanding immediately prior to
such event” within the meaning of Section 13.03(a).

(d)   In case the
Guarantor shall pay a dividend or make a distribution consisting exclusively of
cash to all or substantially all holders of its Common Shares to the extent
that the aggregate of all such cash dividends or distributions paid in any
quarter exceeds the Dividend Threshold Amount for such quarter, the Exchange
Rate shall be adjusted based on the following formula:

	
  ER’

  	
  =

  	
  ER0

  	
  x

  	
  SP0 – T

  
	
   

  	
   

  	
   

  	
   

  	
  SP0 – C

  

 

Where

	
  ER0

  	
  =

  	
  the Exchange Rate in effect immediately prior to the
  Record Date for such distribution;

  
	
   

  	
   

  	
   

  
	
  ER’

  	
  =

  	
  the Exchange Rate in effect immediately after the
  Record Date for such distribution;

  
	
   

  	
   

  	
   

  
	
  SP0

  	
  =

  	
  the average of the Last Reported Sale Prices of the
  Common Shares over the period of 10 consecutive Trading Days ending the
  Business Day immediately preceding the Record Date (as defined in
  clause (f) of this Section) for such distribution (or, if earlier, the
  Ex-Dividend date relating to such distribution); and

  
	
   

  	
   

  	
   

  
	
  T

  	
  =

  	
  the dividend threshold amount (“Dividend
  Threshold Amount”), which amount shall initially be $0.28 per
  quarter and which shall be appropriately adjusted from time to time for any
  share dividends on, or subdivisions or combinations of, Common Shares; provided,
  that if an Exchange Rate adjustment is required to be made as a result of a
  distribution that is not a quarterly dividend either in whole or in part, the
  Dividend Threshold Amount shall be deemed to be zero; and

  
	
   

  	
   

  	
   

  
	
  C

  	
  =

  	
  the amount in cash per share that the Guarantor
  distributes to holders of Common Shares.

  

 

Such adjustment shall
become effective immediately after 5:00 p.m., New York City time, on the
Record Date for such dividend or distribution; provided
that if the portion of the cash so distributed applicable to one Common Share
is equal to or greater than SP0 above, in lieu of the foregoing adjustment,
adequate provision shall be made so that each Noteholder shall have the right
to receive upon exchange of a Note (or any portion thereof) the amount of cash
such Noteholder would have received had such Noteholder owned a number of
shares equal to the Exchange Rate on the Record Date.  If such dividend or distribution is not so
paid or made, the Exchange Rate shall again be adjusted to be the Exchange Rate
that would then be in effect if such dividend or distribution had not been
declared.

For the avoidance of
doubt, for purposes of this Section 13.03(d), in the event of any
reclassification of the Common Shares, as a result of which the Notes become exchangeable
into more 

 61
 

 

than one class of Common
Shares, if an adjustment to the Exchange Rate is required pursuant to this
Section 13.03(d), references in this Section to one Common Share or Last
Reported Sale Price of one Common Share shall be deemed to refer to a unit or
to the price of a unit consisting of the number of shares of each class of
Common Shares into which the Notes are then exchangeable equal to the number of
shares of such class issued in respect of one Common Share in such reclassification.  The above provisions of this paragraph shall
similarly apply to successive reclassifications.

(e)   In case the
Guarantor or any of its Subsidiaries makes a payment in respect of a tender
offer or exchange offer for all or any portion of the Common Shares, to the
extent that the cash and value of any other consideration included in the
payment per Common Share exceeds the Last Reported Sale Price of the Common
Shares on the Trading Day next succeeding the last date on which tenders or
exchanges may be made pursuant to such tender or exchange offer (as it may be
amended), the Exchange Rate shall be increased based on the following formula:

	
  ER’

  	
  =

  	
  ER0

  	
  x

  	
  AC + (SP’ x OS’)

  
	
   

  	
   

  	
   

  	
   

  	
  SP’ x OS0

  

 

Where

	
  ER0

  	
  =

  	
  the Exchange Rate in effect immediately prior to the
  adjustment relating to such event;

  
	
   

  	
   

  	
   

  
	
  ER’

  	
  =

  	
  the new Exchange Rate taking such event into
  account;

  
	
   

  	
   

  	
   

  
	
  AC

  	
  =

  	
  the aggregate value of all cash and any other
  consideration (as determined by the Board of Trustees) paid or payable for
  shares purchased in such tender or exchange offer;

  
	
   

  	
   

  	
   

  
	
  OS0

  	
  =

  	
  the number of Common Shares outstanding immediately
  prior to the date such tender or exchange offer expires;

  
	
   

  	
   

  	
   

  
	
  OS’

  	
  =

  	
  the number of Common Shares outstanding immediately
  after the date such tender or exchange offer expires (after giving effect to
  the purchase or exchange of common Shares pursuant to such tender or exchange
  offer); and

  
	
   

  	
   

  	
   

  
	
  SP’

  	
  =

  	
  the average of the Last Reported Sale Prices of
  Common Shares over the 10 consecutive Trading Day period commencing on the
  Trading Day next succeeding the date such tender or exchange offer expires,

  

 

such adjustment to become
effective immediately prior to the opening of business on the day following the
last date on which tenders or exchanges may be made pursuant to such tender or
exchange offer.  If the Issuer is
obligated to purchase shares pursuant to any such tender or exchange offer, but
the Issuer is permanently prevented by applicable law from effecting all or any
such purchases or all or any portion of such purchases are rescinded, the
Exchange Rate shall again be adjusted to be the Exchange Rate that would then
be in effect if such tender or exchange offer had not been made or had only
been made in respect of the purchases that had been effected.  No adjustment to the Exchange Rate will be
made if the application of the foregoing formula would result in a decrease in
the Exchange Rate.

(f)    For
purposes of this Section 13.03 the term “Record Date” shall mean, with
respect to any dividend, distribution or other transaction or event in which
the holders of Common Shares have the right to receive any cash, securities or
other property or in which the Common Shares (or other applicable 

 62
 

 

security)
is exchanged for or exchanged into any combination of cash, securities or other
property, the date fixed for determination of shareholders entitled to receive
such cash, securities or other property (whether such date is fixed by the
Board of Trustees or by statute, contract or otherwise).

(g)   In addition
to those required by clauses (a), (b), (c), (d), and (e) of this Section
13.03, and to the extent permitted by applicable law and subject to the
applicable rules of the New York Stock Exchange, the Issuer from time to time
may increase the Exchange Rate by any amount for a period of at least
20 days if the Board of Trustees determines that such increase would be in
the Issuer’s best interest.  In addition,
the Issuer may also (but is not required to) increase the Exchange Rate to
avoid or diminish any income tax to holders of Common Shares or rights to
purchase Common Shares in connection with any dividend or distribution of
shares (or rights to acquire shares) or similar event.  Whenever the Exchange Rate is increased
pursuant to the preceding sentence, the Issuer shall mail to the Holder of each
Note at his last address appearing on the Note Register provided for in
Section 2.05 a notice of the increase at least five days prior to the date
the increased Exchange Rate takes effect, and such notice shall state the
increased Exchange Rate and the period during which it will be in effect.

(h)   All
calculations and other determinations under this Article 7 shall be made
by the Issuer and shall be made to the nearest cent or to the nearest 0.00001
of a share, as the case may be.  No
adjustment shall be made for the Guarantor’s issuance of Common Shares or any
securities convertible into or exchangeable for Common Shares, or the right to
purchase Common Shares or such convertible or exchangeable securities, other
than as provided in this Section 13.03. 
No adjustment shall be made to the Exchange Rate unless such adjustment
would require a change of at least 1% in the Exchange Rate then in effect at
such time.  The Issuer shall carry
forward any adjustments that are less than 1% of the Exchange Rate and make
such carried forward adjustments, regardless of whether the aggregate
adjustment is less than 1% within one year of the first such adjustment carried
forward, upon a Fundamental Change, upon any call of the Notes for redemption
or upon maturity.

(i)    Whenever
the Exchange Rate is adjusted as herein provided, the Issuer shall promptly
file with the Trustee and any Exchange Agent other than the Trustee an Officers’
Certificate setting forth the Exchange Rate after such adjustment and setting
forth a brief statement of the facts requiring such adjustment.  The Trustee and Exchange Agent may
conclusively rely on the accuracy of the Exchange Rate adjustment provided by
the Issuer.  Unless and until a
Responsible Officer of the Trustee shall have received such Officers’
Certificate, the Trustee shall not be deemed to have knowledge of any
adjustment of the Exchange Rate and may assume without inquiry that the last
Exchange Rate of which it has knowledge is still in effect.  Promptly after delivery of such certificate,
the Issuer shall prepare a notice of such adjustment of the Exchange Rate
setting forth the adjusted Exchange Rate and the date on which each adjustment
becomes effective and shall mail such notice of such adjustment of the Exchange
Rate to the Holder of each Note at his last address appearing on the Note
Register provided for in Section 2.05 of this Indenture, within 30 days of
the effective date of such adjustment. 
Failure to deliver such notice shall not affect the legality or validity
of any such adjustment.

(j)    For
purposes of this Section 13.03, the number of Common Shares at any time
outstanding shall not include shares held in the treasury of the Guarantor but
shall include shares issuable in respect of scrip certificates issued in lieu
of fractions of Common Shares.

Section 13.04.        Sufficient
Shares to be Delivered.  To the
extent the Issuer elects to deliver Common Shares, and subject to Section
13.02(k), the Issuer shall provide, free from preemptive rights, sufficient
Common Shares to provide for exchange of the Notes from time to time as such
Notes are presented for exchange.

 63

 

Section
13.05.        Effect of
Reclassification, Consolidation, Merger or Sale. If any of the following
events occur, namely (i) any reclassification or change of the outstanding
Common Shares (other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a split,
subdivision or combination), (ii) any consolidation, merger or combination
of the Guarantor with another Person, or (iii) any sale or conveyance of
all or substantially all of the property and assets of the Guarantor to any
other Person, in either case as a result of which holders of Common Shares
shall be entitled to receive cash, securities or other property or assets with
respect to or in exchange for such Common Shares (any such event a “Merger Event”), then:

(a)   the Issuer shall execute with the Trustee a
supplemental indenture (which shall comply with the Trust Indenture Act as in
force at the date of execution of such supplemental indenture if such
supplemental indenture is then required to so comply) providing for the
exchange and settlement of the Notes as set forth in this Indenture. Such
supplemental indenture shall provide for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article
and the Trustee may conclusively rely on the determination by the Issuer of the
equivalency of such adjustments.

If, in the case of any Merger Event, the Reference
Property includes shares of stock or other securities and assets of a
corporation other than the successor or purchasing corporation, as the case may
be, in such reclassification, change, consolidation, merger, combination, sale
or conveyance, then such supplemental indenture shall also be executed by such
other corporation and shall contain such additional provisions to protect the
interests of the Noteholders as the Board of Trustees shall reasonably consider
necessary by reason of the foregoing, including to the extent required by the
Board of Trustees and practicable the provisions providing for the repurchase
rights set forth in Article 8 herein.

In the event the Issuer shall execute a supplemental
indenture pursuant to this Section 13.06, the Issuer shall file with the
Trustee an Officers’ Certificate briefly stating the kind or amount of cash,
securities or property or asset that will constitute the Reference Property
after any such Merger Event, any adjustment to be made with respect thereto,
and the Trustee shall promptly mail notice thereof to all Noteholders.

(b)   Notwithstanding the provisions of Section
13.02(a) and Section 13.02(b), and subject to the provisions of Section 13.01,
at the effective time of such Merger Event, the right to exchange each $1,000
principal amount of Notes will be changed to a right to exchange such Note by
reference to the kind and amount of cash, securities or other property or
assets that a holder of a number of Common Shares equal to the Exchange Rate
immediately prior to such transaction would have owned or been entitled to
receive (the “Reference Property”) such that
from and after the effective time of such transaction, a Noteholder will be
entitled thereafter to exchange its Notes into cash (up to the aggregate
principal amount thereof) and the same type (and in the same proportion) of
Reference Property, based on the Daily Settlement Amounts of Reference Property
in an amount equal to the applicable Exchange Rate, as described under Section
13.02(a) or Section 13.02(b), as applicable. For purposes of determining the
constitution of Reference Property, the type and amount of consideration that a
holder of Common Shares would have been entitled to in the case of
reclassifications, consolidations, mergers, sales or conveyance of assets or
other transactions that cause the Common Shares to be converted into the right
to receive more than a single type of consideration (determined based in part
upon any form of shareholder election) will be deemed to be the weighted
average of the types and amounts of consideration received by the holders of
Common Shares that affirmatively make such an election. The Issuer shall not
become a party to any such transaction unless its terms are consistent with the
preceding. None of the foregoing provisions shall affect the right of a
Noteholder to exchange its Notes in accordance with the provisions of this
Article 8 prior to the effective time of such Merger Event.

 64
 

 

(c)   The Issuer shall cause notice of the
execution of such supplemental indenture to be mailed to each Noteholder, at
his address appearing on the Note Register provided for in Section 2.06,
within 30 days after execution thereof. Failure to deliver such notice shall
not affect the legality or validity of such supplemental indenture.

(d)   The above provisions of this Section shall
similarly apply to successive Merger Events.

Section
13.06.        Certain Covenants. The
Issuer covenants that all Common Shares delivered upon exchange of Notes will
be fully paid and non-assessable by the Guarantor and free from all
taxes, liens and changes with respect to the issue thereof.

Section
13.07.        Responsibility of Trustee.
The Trustee and any other Exchange Agent shall not at any time be under any
duty or responsibility to any Noteholder to determine the Exchange Rate or
whether any facts exist which may require any adjustment of the Exchange Rate,
or with respect to the nature or extent or calculation of any such adjustment
when made, or with respect to the method employed, or herein or in any
supplemental indenture provided to be employed, in making the same. The Trustee
and any other Exchange Agent shall not be accountable with respect to the
validity or value (or the kind or amount) of any Common Shares, or of any
securities or property, which may at any time be issued or delivered upon the
exchange of any Note; and the Trustee and any other Exchange Agent make no
representations with respect thereto. Neither the Trustee nor any Exchange
Agent shall be responsible for any failure of the Issuer to transfer or deliver
any Common Shares or certificates therefor or other securities or property or
cash upon the surrender of any Note for the purpose of exchange or to comply
with any of the duties, responsibilities or covenants of the Issuer contained
in this Article.

Without limiting
the generality of the foregoing, neither the Trustee nor any Exchange Agent
shall be under any responsibility to determine the correctness of any
provisions contained in any supplemental indenture entered into pursuant to
Section 13.05 relating either to the kind or amount of shares of stock or
securities or property (including cash) receivable by Noteholders upon the
exchange of their Notes after any event referred to in such Section 13.05 or to
any adjustment to be made with respect thereto, but, subject to the provisions
of Article 6 of the Original Indenture, may accept as conclusive evidence
of the correctness of any such provisions, and shall be protected in relying
upon, the Officers’ Certificate with respect thereto.

Section
13.08.        Notice to Noteholders
Prior to Certain Actions.

In case:

(a)   the Guarantor shall declare a dividend (or
any other distribution) on its Common Shares that would require an adjustment
in the Exchange Rate pursuant to Section 13.03; or

(b)   the Guarantor shall authorize the granting to
all of the holders of its Common Shares of rights or warrants to subscribe for
or purchase any share of any class or any other rights or warrants;

(c)   of any reclassification of the Common Shares
(other than a subdivision or combination of outstanding Common Shares, or a
change in par value, or from par value to no par value, or from no par value to
par value), or of any consolidation or merger to which the Guarantor is a party
and for which approval of any shareholders of the Guarantor is required, or of
the sale or transfer of all or substantially all of the assets of the
Guarantor; or

(d)   of the voluntary or involuntary dissolution,
liquidation or winding-up of the Guarantor,

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the Issuer shall cause to be filed with the Trustee
and to be mailed to each Noteholder at his address appearing on the Note Register
as promptly as possible but in any event at least 10 days prior to the
applicable date specified in clause (x) or (y) below, as the case may be,
a notice stating (x) the date on which a record is to be taken for the
purpose of such dividend, distribution or rights or warrants, or, if a record
is not to be taken, the date as of which the holders of Common Shares of record
to be entitled to such dividend, distribution or rights are to be determined,
or (y) the date on which such reclassification, consolidation, merger,
sale, transfer, dissolution, liquidation or winding-up is expected to
become effective or occur, and the date as of which it is expected that holders
of Common Shares of record shall be entitled to exchange their Common Shares
for securities or other property deliverable upon such reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding-up.
Failure to give such notice, or any defect therein, shall not affect the
legality or validity of such dividend, distribution, reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding-up.

Section
13.09.        Shareholder Rights Plans.
Upon exchange of the Notes, the Noteholders shall receive, in addition to any
Common Shares issuable upon such exchange, the associated rights issued under
any shareholder rights plan that the Guarantor adopts. If, and only if, the
Noteholders receive rights under such shareholder rights plans as described in
the preceding sentence upon exchange of their Notes, then no other adjustment
pursuant to this Article 7 shall be made in connection with such
shareholder rights plans.

Section
13.10.        Ownership Limit. Notwithstanding
any other provision of this Indenture or the Notes, no Noteholder shall be
entitled to exchange such Notes for Common Shares to the extent that receipt of
such shares would cause such Noteholder (together with such Noteholder’s
affiliates) to exceed the applicable ownership limit contained in the Amended
and Restated Articles of Incorporation of the Guarantor as then in effect.

Section
13.11.        Tax Effect. In
certain circumstances, a Noteholder may be deemed to have received a
constructive dividend or a payment of additional interest subject to U.S.
federal income tax as a result of an Exchange Rate adjustment or the failure to
make an Exchange Rate adjustment. In such event, the Issuer may set-off any
U.S. federal withholding tax that it is required to pay with respect to any
such constructive distribution or payment against cash payments of interest on
the Notes.

Section
13.12.        Taxes on Shares Issued.
The issue of stock certificates, if any, on exchange of Notes shall be made
without charge to the exchanging Noteholder for any documentary, stamp or
similar issue or transfer tax in respect of the issue thereof. The Issuer shall
not, however, be required to pay any such tax which may be payable in respect
of any transfer involved in the issue and delivery of stock in any name other
than that of the holder of any Note exchanged, and the Issuer shall not be
required to issue or deliver any such stock certificate unless and until the
Person or Persons requesting the issue thereof shall have paid to the Issuer
the amount of such tax or shall have established to the satisfaction of the
Issuer that such tax has been paid.

Section
13.13.        Reservation of Shares,
Shares to Be Fully Paid; Compliance with Governmental Requirements; Listing of
Common shares. The Guarantor shall provide, free from preemptive rights,
out of its authorized but unissued shares or shares held in treasury,
sufficient Common Shares to provide for the exchange of the Notes as required
by this Indenture from time to time as such Notes are presented for exchange.

The Guarantor covenants that all Common Shares which
may be issued upon exchange of Notes will upon issue be fully paid and
non-assessable by the Guarantor and free from all taxes, liens and charges with
respect to the issue thereof.

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The Guarantor covenants that, if any Common Shares to
be provided for the purpose of exchange of Notes hereunder require registration
with or approval of any governmental authority under any federal or state law
before such shares may be validly issued upon exchange, the Guarantor shall, as
expeditiously as possible secure such registration or approval, as the case may
be.

The Guarantor further covenants that, if at any time
the Common shares shall be listed on The New York Stock Exchange or any other
national or regional securities exchange or automated quotation system, the
Guarantor will, if permitted by the rules of such exchange or automated
quotation system, list and keep listed, so long as the Common shares shall be
so listed on such exchange or automated quotation system, all the Common shares
issuable upon exchange of the Notes; provided that
if the rules of such exchange or automated quotation system permit the
Guarantor to defer the listing of such Common shares until the first exchange
of the Notes in accordance with the provisions of this Indenture, the Guarantor
covenants to list such Common shares issuable upon exchange of the Notes in
accordance with the requirements of such exchange or automated quotation system
at such time.

Section
13.14.        Calculation in Respect of
Notes. Except as otherwise specifically stated herein or in the Notes, all
calculations to be made in respect of the Notes shall be the obligation of the
Issuer. All calculations made by the Issuer or its agent as contemplated
pursuant to the terms hereof and of the Notes shall be made in good faith and
be final and binding on the Notes and the Holders of the Notes absent manifest
error. The Issuer shall provide a schedule of calculations to the Trustee, and
the Trustee shall be entitled to rely upon the accuracy of the calculations by
the Issuer without independent verification. The Trustee shall forward
calculations made by the Issuer to any Holder of Notes upon request.

ARTICLE
14

MEETINGS
OF HOLDERS OF NOTES

Section
14.01.        Purposes for Which
Meetings May Be Called. A meeting of Holders of Notes may be called at any
time and from time to time pursuant to this Article 14 to make, give or take
any request, demand, authorization, direction, notice, consent, waiver or other
act provided by this Indenture to be made, given or taken by Holders of Notes.

Section
14.02.        Call, Notice and Place of
Meetings. (a) The Trustee may at any time call a meeting of Holders of
Notes for any purpose specified in Section 14.01, to be held at such time and
at such place in The City of New York, New York as the Trustee shall determine.
Notice of every meeting of Holders of Notes, setting forth the time and the
place of such meeting and in general terms the action proposed to be taken at
such meeting, shall be given, in the manner provided in Section 16.03, not less
than 21 nor more than 180 days prior to the date fixed for the meeting.

(b)           In case at any time the Issuer, the
Guarantor or the Holders of at least 10% in principal amount of the Outstanding
Notes shall have requested the Trustee to call a meeting of the Holders of
Notes for any purpose specified in Section 14.01, by written request setting
forth in reasonable detail the action proposed to be taken at the meeting, and
the Trustee shall not have mailed notice of or made the first publication of
the notice of such meeting within 21 days after receipt of such request or
shall not thereafter proceed to cause the meeting to be held as provided
herein, then the Issuer, the Guarantor, if applicable, or the Holders of Notes
in the amount above specified, as the case may be, may determine the time and
the place in the City of New York, New York, for such meeting and may call such
meeting for such purposes by giving notice thereof as provided in clause (a) of
this Section.

Section
14.03.        Persons Entitled to Vote
at Meetings. To be entitled to vote at any meeting of Holders of Notes, a
Person shall be (a) a Holder of one or more Outstanding Notes, or (b) a Person

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appointed by an instrument in writing
as proxy for a Holder or Holders of one or more Outstanding Notes by such
Holder or Holders. The only Persons who shall be entitled to be present or to
speak at any meeting of Holders of Notes shall be the Persons entitled to vote
at such meeting and their counsel, any representatives of the Trustee and its
counsel, any representatives of the Guarantor and its counsel and any
representatives of the Issuer and its counsel.

Section
14.04.        Quorum; Action. The
Persons entitled to vote a majority in principal amount of the Outstanding
Notes shall constitute a quorum for a meeting of Holders of Notes; provided, however, that if any action is to be taken at the
meeting with respect to a consent or waiver which may be given by the Holders
of not less than a specified percentage in principal amount of the Outstanding
Notes, the Persons holding or representing the specified percentage in
principal amount of the Outstanding Notes will constitute a quorum. In the
absence of a quorum within 30 minutes after the time appointed for any such
meeting, the meeting shall, if convened at the request of Holders of Notes, be
dissolved. In any other case the meeting may be adjourned for a period of not
less than 10 days as determined by the chairman of the meeting prior to the
adjournment of such meeting. In the absence of a quorum at any such adjourned
meeting, such adjourned meeting may be further adjourned for a period of not
less than 10 days as determined by the chairman of the meeting prior to the
adjournment of such adjourned meeting. Notice of the reconvening of any
adjourned meeting shall be given as provided in Section 14.02, except that such
notice need be given only once not less than five days prior to the date on
which the meeting is scheduled to be reconvened. Notice of the reconvening of
an adjourned meeting shall state expressly the percentage, as provided above,
of the principal amount of the Outstanding Notes which shall constitute a
quorum.

Except as limited by the proviso to Section 9.02, any
resolution presented to a meeting or adjourned meeting duly reconvened at which
a quorum is present as aforesaid may be adopted only by the affirmative vote of
the Holders of a majority in principal amount of the Outstanding Notes; provided, however, that, except as limited by the proviso to
Section 9.02, any resolution with respect to any request, demand,
authorization, direction, notice, consent, waiver or other action which this
Indenture expressly provides may be made, given or taken by the Holders of a
specified percentage, which is less than a majority, in principal amount of the
Outstanding Notes may be adopted at a meeting or an adjourned meeting duly
reconvened and at which a quorum is present as aforesaid by the affirmative
vote of the Holders of such specified percentage in principal amount of the
Outstanding Notes.

Any resolution passed or decision taken at any meeting
of Holders of Notes duly held in accordance with this Section 14.04 shall be
binding on all the Holders of Notes, whether or not such Holders were present
or represented at the meeting.

Section
14.05.        Determination of Voting
Rights; Conduct and Adjournment of Meetings. (a) Notwithstanding any
other provisions of this Indenture, the Trustee may make such reasonable
regulations as it may deem advisable for any meeting of Holders of Notes in
regard to proof of the holding of Notes and of the appointment of proxies and
in regard to the appointment and duties of inspectors of votes, the submission
and examination of proxies, certificates and other evidence of the right to
vote, and such other matters concerning the conduct of the meeting as it shall
deem appropriate. Except as otherwise permitted or required by any such
regulations, the holding of Notes shall be proved in the manner specified in
Section 8.03 and the appointment of any proxy shall be proved in the manner
specified in Section 8.01.

(b)           The Trustee shall, by an instrument
in writing, appoint a temporary chairman of the meeting, unless the meeting
shall have been called by the Issuer or by Holders of Notes as provided in
Section 14.02(b), in which case the Issuer, the Guarantor or the Holders of
Notes calling the meeting, as the case may be, shall in like manner appoint a
temporary chairman. A permanent chairman and a

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permanent secretary of the meeting
shall be elected by vote of the Persons entitled to vote a majority in
principal amount of the Outstanding Notes of such series represented at the
meeting.

(c)           At any meeting, each Holder of a Note
or proxy shall be entitled to one vote for each $1,000 principal amount of
Notes held or represented by him; provided, however, that no vote shall be cast
or counted at any meeting in respect of any Note challenged as not Outstanding
and ruled by the chairman of the meeting to be not Outstanding. The chairman of
the meeting shall have no right to vote, except as a Holder of a Note or proxy.

(d)           Any meeting of Holders of Notes duly
called pursuant to Section 14.02 at which a quorum is present may be adjourned
from time to time by Persons entitled to vote a majority in principal amount of
the Outstanding Notes represented at the meeting; and the meeting may be held
as so adjourned without further notice.

Section
14.06.        Counting Votes and
Recording Action of Meetings. The vote upon any resolution submitted to any
meeting of Holders of Notes shall be by written ballots on which shall be
subscribed the signatures of the Holders of Notes or of their representatives
by proxy and the principal amounts and serial numbers of the Outstanding Notes
held or represented by them. The permanent chairman of the meeting shall
appoint two inspectors of votes who shall count all votes cast at the meeting
for or against any resolution and who shall make and file with the secretary of
the meeting their verified written reports in triplicate of all votes cast at
the meeting. A record, at least in triplicate, of the proceedings of each
meeting of Holders of Notes shall be prepared by the secretary of the meeting
and there shall be attached to said record the original reports of the
inspectors of votes on any vote by ballot taken thereat and affidavits by one
or more persons having knowledge of the facts setting forth a copy of the
notice of the meeting and showing that said notice was given as provided in
Section 14.02 and, if applicable, Section 14.04. Each copy shall be signed and
verified by the affidavits of the permanent chairman and secretary of the
meeting and one such copy shall be delivered to the Issuer and the Guarantor,
and another to the Trustee to be preserved by the Trustee, the latter to have
attached thereto the ballots voted at the meeting. Any record so signed and
verified shall be conclusive evidence of the matters therein stated.

ARTICLE
15

GUARANTEE

Section
15.01.        Guarantee. By its
execution hereof, the Guarantor acknowledges and agrees that it receives
substantial benefits from the Issuer and that the Guarantor is providing its
Guarantee for good and valuable consideration, including, without limitation,
such substantial benefits. Accordingly, subject to the provisions of this
Article 15, the Guarantor hereby unconditionally guarantees to each Holder of a
Note authenticated and delivered by the Trustee and its successors and assigns
that: (i) the principal of (including the Redemption Price or repurchase price
upon redemption or repurchase pursuant to Article 3), premium, if any, and
interest and Additional Interest, if any, on the Notes shall be duly and
punctually paid in full when due, whether at the Maturity Date, upon
acceleration, upon redemption, upon a repurchase, upon repurchase due to a
Fundamental Change or otherwise, and interest on overdue principal, premium, if
any, Additional Interest, if any, and (to the extent permitted by law) interest
on any interest, if any, on the Notes and all other obligations of the Issuer
to the Holders or the Trustee hereunder or under the Notes (including fees,
expenses or other) shall be promptly paid in full or performed, all in
accordance with the terms hereof; and (ii) in case of any extension of time of
payment or renewal of any Notes or any of such other obligations, the same
shall be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at the Maturity Date, by
acceleration, call for redemption, upon repurchase, upon repurchase due to a
Fundamental Change or otherwise, subject,

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however, in the case of clauses (i)
and (ii) above, to the limitations set forth in Section 15.03 hereof
(collectively, the “Guarantee Obligations”).

Subject to the provisions of this Article 15, the
Guarantor hereby agrees that its Guarantee hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Notes or this
Indenture, the absence of any action to enforce the same, any waiver or consent
by any Holder of the Notes with respect to any thereof, the entry of any
judgment against the Issuer, any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of the Guarantor. The Guarantor hereby waives and relinquishes: (a) any
right to require the Trustee, the Holders or the Issuer (each, a “Benefited Party”) to proceed against the Issuer or any other
Person or to proceed against or exhaust any security held by a Benefited Party
at any time or to pursue any other remedy in any secured party’s power before
proceeding against the Guarantor; (b) any defense that may arise by reason of
the incapacity, lack of authority, death or disability of any other Person or
Persons or the failure of a Benefited Party to file or enforce a claim against
the estate (in administration, bankruptcy or any other proceeding) of any other
Person or Persons; (c) demand, protest and notice of any kind (except as
expressly required by this Indenture), including but not limited to notice of
the existence, creation or incurring of any new or additional indebtedness or
obligation or of any action or non-action on the part of the Guarantor, the
Issuer, any Benefited Party, any creditor of the Guarantor or the Issuer or on
the part of any other Person whomsoever in connection with any obligations the
performance of which are hereby guaranteed; (d) any defense based upon an
election of remedies by a Benefited Party, including but not limited to an
election to proceed against the Guarantor for reimbursement; (e) any defense
based upon any statute or rule of law which provides that the obligation of a
surety must be neither larger in amount nor in other respects more burdensome
than that of the principal; (f) any defense arising because of a Benefited
Party’s election, in any proceeding instituted under the Bankruptcy Law, of the
application of Section 1111(b)(2) of the Bankruptcy Code; and (g) any defense
based on any borrowing or grant of a security interest under Section 364 of the
Bankruptcy Code. The Guarantor hereby covenant that, except as otherwise
provided therein, the Guarantee shall not be discharged except by payment in
full of all Guarantee Obligations, including the principal, premium, if any,
and interest on the Notes and all other costs provided for under this Indenture
or as provided in Article 7.

If any Holder or the Trustee is required by any court
or otherwise to return to either the Issuer or the Guarantor, or any trustee or
similar official acting in relation to either the Issuer or the Guarantor, any
amount paid by the Issuer or the Guarantor to the Trustee or such Holder, the
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect. The Guarantor agrees that it shall not be entitled to any
right of subrogation in relation to the Holders in respect of any Guarantee
Obligations hereby until payment in full of all such obligations guaranteed
hereby. The Guarantor agrees that, as between it, on the one hand, and the
Holders of Notes and the Trustee, on the other hand, (x) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6
hereof for the purposes hereof, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Guarantee
Obligations, and (y) in the event of any acceleration of such obligations as
provided in Article 6 hereof, such Guarantee Obligations (whether or not due
and payable) shall forthwith become due and payable by the Guarantor for the
purpose of the Guarantee.

Section
15.02.        Execution and Delivery of
Guarantee. To evidence the Guarantee set forth in Section 15.01 hereof, the
Guarantor agrees that a notation of the Guarantee substantially in the form
included in Exhibit A hereto shall be endorsed on each Note authenticated and
delivered by the Trustee and that this Indenture shall be executed on behalf of
the Guarantor by an officer of the Guarantor.

The Guarantor agrees that the Guarantee set forth in
this Article 15 shall remain in full force and effect and apply to all the
Notes notwithstanding any failure to endorse on each Note a notation of the
Guarantee.

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If an officer whose facsimile signature is on a Note
or a notation of Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which the Guarantee is endorsed, the Guarantee shall
be valid nevertheless.

The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Guarantee set forth in this Indenture on behalf of the Guarantor.

Section
15.03.        Limitation of Guarantor’s
Liability; Certain Bankruptcy Events. (a) The Guarantor, and by its
acceptance hereof each Holder, hereby confirms that it is the intention of all
such parties that the Guarantee Obligations of the Guarantor pursuant to its
Guarantee not constitute a fraudulent transfer or conveyance for purposes of
any Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform
Fraudulent Transfer Act or any similar federal or state law. To effectuate the
foregoing intention, the Holders and the Guarantor hereby irrevocably agree
that the Guarantee Obligations of the Guarantor under this Article 15 shall be
limited to the maximum amount as shall, after giving effect to all other
contingent and fixed liabilities of the Guarantor, result in the Guarantee
Obligations of the Guarantor under the Guarantee not constituting a fraudulent
transfer or conveyance.

(b)           The Guarantor hereby covenants and
agrees, to the fullest extent that it may do so under applicable law, that in
the event of the insolvency, bankruptcy, dissolution, liquidation or
reorganization of the Issuer, the Guarantor shall not file (or join in any
filing of), or otherwise seek to participate in the filing of, any motion or
request seeking to stay or to prohibit (even temporarily) execution on the
Guarantee and hereby waives and agrees not to take the benefit of any such stay
of execution, whether under Section 362 or 105 of the Bankruptcy Law or
otherwise.

Section
15.04.        Application of Certain
Terms and Provisions to the Guarantor. (a) For purposes of any
provision of this Indenture which provides for the delivery by the Guarantor of
an Officers’ Certificate and/or an Opinion of Counsel, the definitions of such
terms in Section 1.01 hereof shall apply to the Guarantor as if references
therein to the Issuer or the General Partner, as applicable, were references to
the Guarantor.

(b)           Any request, direction, order or
demand which by any provision of this Indenture is to be made by the Guarantor
shall be sufficient if evidenced as described in Section 16.03 hereof as if
references therein to the Issuer were references to the Guarantor.

(c)           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 Notes to or on the Guarantor may be given or
served as described in Section 16.03 hereof as if references therein to the
Issuer were references to the Guarantor.

(d)           Upon any demand, request or
application by the Guarantor to the Trustee to take any action under this
Indenture, the Guarantor shall furnish to the Trustee such certificates and
opinions as are required in Section 16.05 hereof as if all references therein
to the Issuer were references to the Guarantor.

ARTICLE
16

MISCELLANEOUS
PROVISIONS

Section
16.01.        Provisions Binding on
Issuer’s and Guarantor’s Successors. All the covenants, stipulations,
promises and agreements by the Issuer or Guarantor contained in this Indenture
shall bind their respective successors and assigns whether so expressed or not.

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Section
16.02.        Official Acts by
Successor Corporation. 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 Issuer shall and may be done and performed with
like force and effect by the like board, committee or officer of any Person
that shall at the time be the lawful sole successor of the Issuer or Guarantor.

Section
16.03.        Addresses for Notices,
etc. 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
Notes on the Issuer or Guarantor shall be in writing and shall be deemed to
have been sufficiently given or made, for all purposes, if given or served by
being deposited postage prepaid by registered or certified mail in a post office
letter box, or sent by overnight courier, or sent by telecopier transmission
addressed as follows:

To Issuer:

Corporate Office
Properties, L.P.

671 Columbia Gateway Drive,

Suite 300, Columbia, Maryland 21046

Telecopier No.: (443) 285–7650

Attention: General Counsel

To Guarantor:

Corporate Office
Properties Trust

671 Columbia Gateway Drive,

Suite 300, Columbia, Maryland 21046

Telecopier No.: (443) 285–7650

Attention: General Counsel

Any notice, direction, request or demand hereunder to
or upon the Trustee shall be deemed to have been sufficiently given or made,
for all purposes, if given or served by being deposited, postage prepaid, by
registered or certified mail in a post office letter box, or sent by overnight
courier, or sent by telecopier transmission addressed as follows:

Wells Fargo Bank,
National Association

608 2nd Avenue South, MAC N9303-120

Minneapolis, MN 55479

Telecopier No.: (612) 667-9825

Attention: Corporate Trust Services

The Trustee, by notice to the Issuer, may designate
additional or different addresses for subsequent notices or communications.

Any notice or communication mailed to a Noteholder
shall be delivered via electronic transmission or mailed by first class mail,
postage prepaid, at such Noteholder’s address as it appears on the Note
Register and shall be sufficiently given to such Noteholder if so mailed within
the time prescribed.

Failure to deliver a notice or communication to a
Noteholder or any defect in it shall not affect its sufficiency with respect to
other Noteholders. If a notice or communication is mailed in the manner
provided above, it is duly given, whether or not the addressee receives it.

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Section
16.04.        Governing Law. This
Indenture shall be governed by, and construed in accordance with, the laws of
the State of New York without regard to conflict of law principles that would
result in the application of any laws other than the laws of the State of New
York.

Section
16.05.        Evidence of Compliance
with Conditions Precedent, Certificates to Trustee. Upon any application or
demand by the Issuer to the Trustee to take any action under any of the
provisions of this Indenture, the Issuer 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, if requested by the Trustee, 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 statement or opinion contained in such certificate
or opinion is based; (3) a statement that, in the opinion of such person, such
person has made such examination or investigation as is necessary to enable
such person to express an informed opinion as to whether or not such covenant
or condition has been complied with; and (4) a statement as to whether or not,
in the opinion of such person, such condition or covenant has been complied
with; provided, however,
that with respect to matters of fact an Opinion of Counsel may rely on an
Officers’ Certificate or certificates of public officials.

Section
16.06.        Legal Holidays. In
any case in which the Maturity Date of interest on or principal of the Notes or
the Redemption Date or Repurchase Date of any Note will not be a Business Day,
then payment of such interest on or principal of the Notes 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 Maturity Date or the Redemption Date or
Repurchase Date, and no interest shall accrue for the period from and after
such date.

Section
16.07.        Trust Indenture Act. This
Indenture is hereby made subject to, and shall be governed by, the provisions
of the Trust Indenture Act required to be part of and to govern indentures
qualified under the Trust Indenture Act; provided that
this Section 16.07 shall not require this Indenture or the Trustee to be
qualified under the Trust Indenture Act prior to the time such qualification is
in fact required under the terms of the Trust Indenture Act, nor shall it
constitute any admission or acknowledgment by any party to the Indenture that
any such qualification is required prior to the time such qualification is in
fact required under the terms of the Trust Indenture Act. If any provision
hereof limits, qualifies or conflicts with another provision hereof which is
required to be included in an indenture qualified under the Trust Indenture
Act, such required provision shall control.

Section
16.08.        No Security Interest
Created. Nothing in this Indenture or in the Notes, expressed or implied,
shall be construed to constitute a security interest under the Uniform
Commercial Code or similar legislation, as now or hereafter enacted and in
effect, in any jurisdiction in which property of the Issuer or its subsidiaries
is located.

Section
16.09.        Benefits of Indenture.
Nothing in this Indenture or in the Notes, express or implied, shall give to
any Person, other than the parties hereto, any Paying Agent, any authenticating
agent, any Note Registrar and their successors hereunder and the Holders of
Notes any benefit or any legal or equitable right, remedy or claim under this
Indenture.

Section 16.10.        Table of Contents, Headings, etc.
The table of contents and the titles and headings of the Articles and Sections
of this Indenture have been inserted for convenience of reference

 73
 

 

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
16.11.        Authenticating Agent.
The Trustee may appoint an authenticating agent that shall be authorized to act
on its behalf, and subject to its direction, in the authentication and delivery
of Notes in connection with the original issuance thereof and transfers and
exchanges of Notes hereunder, including under Sections 2.04, 2.05, 2.06, 2.07,
3.03, 3.05 and 3.06, as fully to all intents and purposes as though the
authenticating agent had been expressly authorized by this Indenture and those
Sections to authenticate and deliver Notes. For all purposes of this Indenture,
the authentication and delivery of Notes by the authenticating agent shall be
deemed to be authentication and delivery of such Notes “by the Trustee” and a
certificate of authentication executed on behalf of the Trustee by an
authenticating agent shall be deemed to satisfy any requirement hereunder or in
the Notes for the Trustee’s certificate of authentication. Such authenticating
agent shall at all times be a Person eligible to serve as trustee hereunder
pursuant to Section 7.09.

Any corporation into which any authenticating agent
may be merged or exchanged or with which it may be consolidated, or any
corporation resulting from any merger, consolidation or exchange to which any
authenticating agent shall be a party, or any corporation succeeding to the
corporate trust business of any authenticating agent, shall be the successor of
the authenticating agent hereunder, if such successor corporation is otherwise
eligible under this Section 16.11, without the execution or filing of any paper
or any further act on the part of the parties hereto or the authenticating
agent or such successor corporation.

Any authenticating agent may at any time resign by
giving written notice of resignation to the Trustee and to the Issuer. The
Trustee may at any time terminate the agency of any authenticating agent by
giving written notice of termination to such authenticating agent and to the
Issuer. Upon receiving such a notice of resignation or upon such a termination,
or in case at any time any authenticating agent shall cease to be eligible
under this Section, the Trustee shall either promptly appoint a successor
authenticating agent or itself assume the duties and obligations of the former
authenticating agent under this Indenture and, upon such appointment of a
successor authenticating agent, if made, shall give written notice of such
appointment of a successor authenticating agent to the Issuer and shall mail
notice of such appointment of a successor authenticating agent to all Holders
of Notes as the names and addresses of such Holders appear on the Note
Register.

The Issuer agrees to pay to the authenticating agent
from time to time such reasonable compensation for its services as shall be
agreed upon in writing between the Issuer and the authenticating agent.

The provisions of Sections 7.02, 7.03, 7.04 and 8.03
and this Section 16.11 shall be applicable to any authenticating agent.

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

Section
16.13.        Severability. In case
any provision in this Indenture or in the Notes shall be invalid, illegal or
unenforceable, then (to the extent permitted by law) the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.

Wells Fargo Bank, National Association, hereby accepts
the trusts in this Indenture declared and provided, upon the terms and
conditions herein above set forth.

 74
 

 

IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed.

	
   

  	
  CORPORATE OFFICE PROPERTIES,
  L.P.

  
	
   

  	
  By:

  	
   Corporate Office Properties Trust 

  
	
   

  	
   

  	
  Its Sole General
  Partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Roger A.
  Waesche, Jr.

  	
   

  
	
   

  	
   

  	
  Name: Roger A.
  Waesche, Jr.

  
	
   

  	
   

  	
  Title: Executive
  Vice President

  
	
   

  	
   

  
	
   

  	
  CORPORATE OFFICE
  PROPERTIES TRUST,

  
	
   

  	
   

  	
   as Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Roger A.
  Waesche, Jr.

  	
   

  
	
   

  	
   

  	
  Name: Roger A.
  Waesche, Jr.

  
	
   

  	
   

  	
  Title: Executive
  Vice President

  
	
   

  	
   

  
	
   

  	
  WELLS FARGO
  BANK, NATIONAL ASSOCIATION,

  
	
   

  	
   

  	
  as Trustee

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lynn
  M.Steiner

  	
   

  
	
   

  	
   

  	
  Name: Lynn M.
  Steiner

  
	
   

  	
   

  	
  Title: Vice
  President

  
									

 

 75

 

SCHEDULE
A

	
   

  	
   

  	
  Stock Price

  	
   

  
	
  Effective Date

  	
   

  	
  $45.25

  	
   

  	
  $50.00

  	
   

  	
  $54.30

  	
   

  	
  $55.00

  	
   

  	
  $60.00

  	
   

  	
  $65.00

  	
   

  	
  $70.00

  	
   

  	
  $75.00

  	
   

  	
  $80.00

  	
   

  	
  $85.00

  	
   

  	
  $90.00

  	
   

  	
  $95.00

  	
   

  	
  $100.00

  	
   

  	
  $110.00

  	
   

  	
  $120.00

  	
   

  
	
  18-Sep-06

  	
   

  	
  3.68

  	
   

  	
  2.66

  	
   

  	
  2.01

  	
   

  	
  1.93

  	
   

  	
  1.44

  	
   

  	
  1.10

  	
   

  	
  0.87

  	
   

  	
  0.70

  	
   

  	
  0.58

  	
   

  	
  0.49

  	
   

  	
  0.43

  	
   

  	
  0.37

  	
   

  	
  0.33

  	
   

  	
  0.27

  	
   

  	
  0.22

  	
   

  
	
  20-Sep-07

  	
   

  	
  3.68

  	
   

  	
  2.50

  	
   

  	
  1.83

  	
   

  	
  1.73

  	
   

  	
  1.24

  	
   

  	
  0.91

  	
   

  	
  0.69

  	
   

  	
  0.54

  	
   

  	
  0.44

  	
   

  	
  0.37

  	
   

  	
  0.31

  	
   

  	
  0.27

  	
   

  	
  0.24

  	
   

  	
  0.19

  	
   

  	
  0.16

  	
   

  
	
  20-Sep-08

  	
   

  	
  3.68

  	
   

  	
  2.40

  	
   

  	
  1.69

  	
   

  	
  1.59

  	
   

  	
  1.08

  	
   

  	
  0.77

  	
   

  	
  0.56

  	
   

  	
  0.43

  	
   

  	
  0.35

  	
   

  	
  0.29

  	
   

  	
  0.25

  	
   

  	
  0.22

  	
   

  	
  0.19

  	
   

  	
  0.16

  	
   

  	
  0.13

  	
   

  
	
  20-Sep-09

  	
   

  	
  3.68

  	
   

  	
  2.17

  	
   

  	
  1.40

  	
   

  	
  1.30

  	
   

  	
  0.79

  	
   

  	
  0.49

  	
   

  	
  0.32

  	
   

  	
  0.22

  	
   

  	
  0.17

  	
   

  	
  0.14

  	
   

  	
  0.12

  	
   

  	
  0.10

  	
   

  	
  0.09

  	
   

  	
  0.07

  	
   

  	
  0.06

  	
   

  
	
  20-Sep-10

  	
   

  	
  3.68

  	
   

  	
  1.84

  	
   

  	
  0.95

  	
   

  	
  0.85

  	
   

  	
  0.35

  	
   

  	
  0.12

  	
   

  	
  0.03

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  
	
  20-Sep-11

  	
   

  	
  3.68

  	
   

  	
  0.95

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  	
  0.00

  	
   

  

 

 

EXHIBIT A

[Include only for Global Notes]

[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW
YORK) (THE “DEPOSITARY,” WHICH TERM INCLUDES
ANY SUCCESSOR DEPOSITARY FOR THE CERTIFICATES) TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT HEREIN IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]

[Include only for Notes
that are Restricted Securities]

NEITHER THIS SECURITY NOR THE COMMON SHARES OF
BENEFICIAL INTEREST ISSUABLE ON EXCHANGE OF THIS SECURITY HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE
SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR
THE COMMON SHARES OF BENEFICIAL INTEREST ISSUABLE ON EXCHANGE OF THIS SECURITY,
NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, SUCH REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE
HEREOF, (1) REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”)); (2) AGREES ON ITS OWN
BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED
SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY OR ANY COMMON
SHARES OF BENEFICIAL INTEREST ISSUABLE ON EXCHANGE OF THIS SECURITY, PRIOR TO
THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THIS SECURITY UNDER
RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), ONLY (A) TO
CORPORATE OFFICE PROPERTIES, L.P. (THE “ISSUER”), (B) UNDER A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH
CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER), (C) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE UNDER RULE 144A, IN COMPLIANCE WITH RULE
144A TO A PERSON IT REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER
TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A OR (D) UNDER ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S
RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER UNDER CLAUSE (D) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM; AND (3) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND.

 

THIS LEGEND WILL BE REMOVED ON THE EARLIER OF THE
TRANSFER OF THIS SECURITY UNDER CLAUSE 2(B) ABOVE OR ON ANY TRANSFER OF THIS
SECURITY UNDER RULE 144 UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION).

[Include only for Common Shares that are Restricted
Securities]

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES
LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY, NOR ANY INTEREST
OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
SUCH REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, (1)
REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT (“RULE 144A”)); (2) AGREES ON ITS OWN BEHALF AND
ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO
OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE EXPIRATION OF THE
HOLDING PERIOD APPLICABLE TO SALES OF THIS SECURITY UNDER RULE 144(k) UNDER THE
SECURITIES ACT (OR ANY SUCCESSOR PROVISION), ONLY (A) TO CORPORATE OFFICE
PROPERTIES, L.P. (THE “ISSUER”), (B) UNDER A REGISTRATION STATEMENT THAT HAS
BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH CONTINUES TO BE
EFFECTIVE AT THE TIME OF SUCH TRANSFER), (C) FOR SO LONG AS THE SECURITIES ARE
ELIGIBLE FOR RESALE UNDER RULE 144A, IN COMPLIANCE WITH RULE 144A TO A PERSON
IT REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A OR (D)
UNDER ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER UNDER CLAUSE (D) TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH
OF THEM; AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS
SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

THIS LEGEND WILL BE REMOVED ON THE EARLIER OF THE
TRANSFER OF THIS SECURITY UNDER CLAUSE 2(B) ABOVE OR ON ANY TRANSFER OF THIS
SECURITY UNDER RULE 144 UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION).

 3
 

 

CORPORATE OFFICE PROPERTIES, L.P.

3.50% EXCHANGEABLE SENIOR
NOTES DUE 2026

	
  REGISTERED

  	
  PRINCIPAL AMOUNT

  
	
  No.:

  	
  $200,000,000

  
	
  CUSIP No.:
  22003BAA4

  	
   

  

 

CORPORATE OFFICE PROPERTIES, L.P., a Delaware limited
partnership (hereinafter called the “Issuer,” which
term shall include any successor under the Indenture hereinafter referred to),
for value received, hereby promises to pay to Cede & Co., or registered
assigns, upon presentation, the principal sum of $[175,000,000] on September
15, 2026 and to pay interest on the outstanding principal amount thereon from
September 18, 2006 or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, semi-annually in arrears on March
15 and September 15 in each year, commencing on March 15, 2007, at the rate of
3.50% per annum, until the entire principal hereof is paid or made available
for payment.  The Notes will be fully and
unconditionally guaranteed by Corporate Office Properties Trust (the “Guarantor”), on a senior unsecured basis, in accordance with
the provisions of Article 16 of the
Indenture (as defined below).

The interest so payable, and punctually paid or duly
provided for on any Interest Payment Date will, as provided in the Indenture,
be paid to the Person in whose name this Note is registered at the Close of
Business on the Record Date for such interest which shall be the March 1 or
September 1, as the case may be, next preceding such Interest Payment
Date.  Payment of the principal of and
interest on this Note will be made at the office of the Issuer maintained by
the Issuer for such purposes, which shall initially be an office or agency of
the Trustee, or elsewhere as provided in the Indenture, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided,
however, that at the option of the
Issuer, payment of interest may be made by (i) check mailed to the address of
the Person entitled thereto as such address shall appear in the Security
Register or (ii) transfer to an account of the Person entitled thereto located
inside the United States.

Each Note of this series is one of a duly authorized
issue of securities of the Issuer (herein called the “Notes”),
issued under an Indenture, dated as of September 18, 2006 (the “Indenture”), between the Issuer, the Guarantor and Wells
Fargo Bank, National Association, as trustee (herein called the “Trustee”). Reference is hereby made to the Indenture for a
statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Issuer, the Trustee and the Holders of the Notes
and of the terms upon which the Notes are, and are to be, authenticated and
delivered.  This Note is one of the
series designated on the first page hereof, initially limited in aggregate
principal amount to $[200,000,000], subject to the Issuer’s right to increase
the aggregate principal amount of such series from time to time.

In case an Event of Default, as defined in the
Indenture, shall have occurred and be continuing, the principal of and interest
on all Notes may be declared, and upon said declaration shall become, due and
payable, in the manner, with the effect and subject to the conditions provided
in the Indenture.

As provided in and subject to the provisions of the
Indenture, unless the principal of all of the Notes of this series at the time
Outstanding shall already have become due and payable, the Holder of this Note
shall not have the right to institute any proceeding with respect to the
Indenture or for the appointment of a receiver or trustee or for any other
remedy thereunder, unless such Holder shall have previously given the Trustee
written notice of a continuing Event of Default with respect to the Notes of
this series, the Holders of not less than 25% in principal amount of the Notes
of this series at the time Outstanding shall have made written request to the
Trustee to institute proceedings in respect of such

 4
 

 

Event of Default as Trustee and offered the Trustee
reasonable indemnity and the Trustee shall not have received from the Holders
of a majority in principal amount of Notes of this series at the time
Outstanding a direction inconsistent with such request, and the Trustee shall
have failed to institute any such proceeding for 60 days after receipt of such
notice, request and offer of indemnity. 
The foregoing shall not apply to any suit instituted by the Holder of
this Note for the enforcement of any payment of principal hereof or any
interest on or after the respective due dates expressed herein.

Prior to September 20, 2011, the Issuer may not redeem
the Notes except to preserve the Guarantor’s status as a real estate investment
trust as described in Section 3.01 of the Indenture.  Subject to the terms and conditions of the
Indenture, on or after September 20, 2011, the Issuer shall have the right to
redeem the Notes, in whole or from time to time in whole or part, at a price
equal to 100% of the principal amount of the Notes being redeemed, plus accrued
and unpaid interest. The Issuer shall not redeem the Notes until it has made at
least 10 semi-annual interest payments (including the interest payments on
March 15, 2007 through September 15, 2011) in the full amount required by this
Indenture and the Notes.   Any such
redemption shall be upon at least 30 days’ and no more than 60 days’ notice to
Holders of the Notes.

Subject to the terms and conditions of the Indenture,
the Issuer will make all payments and deliveries in respect of the Fundamental
Change Repurchase Price, the Put Right Repurchase Price, the redemption price
and the principal amount on the Maturity Date, as the case may be, to the
Holder who surrenders a Note to a Paying Agent to collect such payments in
respect of the Note.  The Issuer will pay
cash amounts in money of the United States that at the time of payment is legal
tender for payment of public and private debts.

The Indenture contains provisions permitting the
Issuer and the Trustee in certain circumstances, without the consent of the
Holders of the Notes, and in other circumstances, with the consent of the
Holders of not less than a majority in aggregate principal amount of the Notes
at the time Outstanding, evidenced as in the Indenture provided, to execute
supplemental indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of the Indenture or of any supplemental
indenture or modifying in any manner the rights of the Holders of the
Notes.  It is also provided in the
Indenture that the Holders of a majority in aggregate principal amount of the
Notes at the time Outstanding may on behalf of the Holders of all of the Notes
waive any past default or Event of Default under the Indenture and its
consequences except as provided in the Indenture.  Any such consent or waiver by the Holder of
this Note (unless revoked as provided in the Indenture) shall be conclusive and
binding upon such Holder and upon all future Holders and owners of this Note
and any Notes which may be issued in exchange or substitution hereof,
irrespective of whether or not any notation thereof is made upon this Note or
such other Notes.

No reference herein to the Indenture and no provision
of this Note or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
accrued and unpaid interest on this Note at the place, at the respective times,
at the rate and in the lawful money herein prescribed.

The Notes are issuable in registered form without
coupons in denominations of $1,000 principal amount and integral multiples
thereof.  At the office or agency of the
Issuer referred to on the face hereof, and in the manner and subject to the
limitations provided in the Indenture, without payment of any service charge
but with payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration or exchange of
Notes, Notes may be exchanged for a like aggregate principal amount of Notes of
other authorized denominations.

The Notes are not subject to redemption through the
operation of any sinking fund.

 5
 

 

Upon the occurrence of a Fundamental Change, the
Holder has the right, at such Holder’s option, to require the Issuer to
repurchase all of such Holder’s Notes or any portion thereof (in principal
amounts of $1,000 or integral multiples thereof) on the Fundamental Change
Repurchase Date at a price equal to 100% of the principal amount of the Notes
such Holder elects to require the Issuer to repurchase, together with accrued
and unpaid interest to but excluding the Fundamental Change Repurchase
Date.  The Issuer or, at the written
request of the Issuer, the Trustee shall mail to all Holders of record of the
Notes a notice of the occurrence of a Fundamental Change and of the repurchase
right arising as a result thereof on or before the twentieth day after the
occurrence of any Fundamental Change.

On September 15, 2011, September 15, 2016 or
September 15, 2021, the Holder has the right, at such Holder’s option, to
require the Issuer to repurchase all of such Holder’s Notes or any portion thereof
(in principal amounts of $1,000 or integral multiples thereof) at a price equal
to 100% of the principal amount of the Notes such Holder elects to require the
Issuer to repurchase, together with accrued and unpaid interest to but
excluding the Put Right Repurchase Date. 
Holders shall submit their Notes for repurchase to the Paying Agent at
any time from the opening of business on the date that is 25 Business Days
prior to the applicable Put Right Repurchase Date until the Close of Business
on the fifth Business Day prior to the Put Right Repurchase Date.

Subject to the provisions of the Indenture, the Holder
has the right, at its option, to exchange all or any portion (if the portion to
be exchanged is $1,000 principal amount or an integral multiple thereof) of
such Notes at any time prior to the Close of Business on the scheduled Trading
Day immediately preceding September 20, 2011, into cash, Common Shares or a
combination thereof, in each case at the Exchange Rate specified in the
Indenture, as adjusted from time to time as provided in the Indenture.  The initial Exchange Rate is 18.4162 Common
Shares for each $1,000 principal amount of Notes.  No fractional Common Shares will be issued
upon any exchange, but an adjustment in cash will be paid to the Holder, as
provided in the Indenture, in respect of any fraction of a share which would
otherwise be issuable upon the surrender of any Note or Notes for
exchange.  No adjustment shall be made
for dividends or any shares issued upon exchange of such Note except as
provided in the Indenture.

Upon due presentment for registration of transfer of
this Note at the office or agency of the Company, a new Note or Notes of
authorized denominations for an equal aggregate principal amount will be issued
to the transferee in exchange thereof, subject to the limitations provided in
the Indenture, without charge except for any tax, assessments or other
governmental charge imposed in connection therewith.

The Issuer, the Trustee, any Authenticating Agent, any
Paying Agent, any Exchange Agent and any Security Registrar may deem and treat
the registered Holder hereof as the absolute owner of this Note (whether or not
this Note shall be overdue and notwithstanding any notation of ownership or
other writing hereon), for the purpose of receiving payment hereof, or on
account hereof, for the exchange hereof and for all other purposes, and neither
the Issuer nor the Trustee nor any other Authenticating Agent nor any Paying
Agent nor any other Exchange Agent nor any Security Registrar shall be affected
by any notice to the contrary.  All
payments made to or upon the order of such registered Holder shall, to the
extent of the sum or sums paid, satisfy and discharge liability for monies
payable on this Note.

No recourse for the payment of the principal of, or
accrued and unpaid interest on, this Note, or for any claim based hereon or
otherwise in respect hereof, and no recourse under or upon any obligation,
covenant or agreement of the Issuer in the Indenture or any indenture supplemental
thereto or in any Note, or because of the creation of any indebtedness
represented thereby, shall be had against any incorporator, shareholder,
employee, agent, officer, director, trustee or subsidiary, as such, past,
present or future, of the Issuer or of any successor corporation, either
directly or through the Issuer or any successor corporation, whether by virtue
of any constitution, statute or rule of law or by the enforcement of any
assessment or

 6
 

 

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

Terms used in this Note and defined in the Indenture
are used herein as therein defined. 
Customary abbreviations may be used in the name of a Holder or an
assignee, such as TEN COM (=tenants in common), TENANT (=tenants by the
entireties), JT TEN (=joint tenants with right of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform gift to Minors
Act).

THE INDENTURE AND THE NOTES, INCLUDING THIS NOTE
(WHICH SHALL BE DEEMED A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW
YORK), SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.

Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has caused
“CUSIP” numbers to be printed on the Notes of this series as a convenience to
the Holders of such Notes.  No
representation is made as to the correctness or accuracy of such CUSIP numbers
as printed on the Notes, and reliance may be placed only on the other
identification numbers printed hereon.

No Holder of Notes shall be entitled to exchange such
Notes for Common Shares to the extent that receipt of such Common Shares would
cause such Holder (together with such Holder’s affiliates) to exceed the
applicable ownership limit contained in the Amended and Restated Articles of
Incorporation of the Guarantor as then in effect.

[This
space intentionally left blank.]

 7

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

IN WITNESS WHEREOF, the Issuer has caused this
instrument to be duly executed by the undersigned officer.

	
  

  	
  CORPORATE OFFICE PROPERTIES, L.P.

  
	
   

  	
   

  	
  By: Corporate Office Properties Trust, its general

  partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
    Name:

  
	
   

  	
   

  	
    Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CORPORATE OFFICE PROPERTIES TRUST

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
					

 

TRUSTEE’S CERTIFICATE OF
AUTHENTICATION:

This is one of the
Notes of the series designated therein referred to in the within-mentioned
Indenture.

WELLS FARGO BANK,
NATIONAL ASSOCIATION, as Trustee

	
  By:

  	
   

  	
   

  
	
   

  	
    Authorized Officer

  

 

 A-1
 

 

GUARANTEE

The Guarantor listed below (hereinafter referred to as
the “Guarantor,” which term includes any
successors or assigns under the Indenture, dated the date hereof, among the
Guarantor, the Issuer (defined below) and Wells Fargo Bank, National
Association, as trustee (the “Indenture”),
has irrevocably and unconditionally guaranteed on a senior basis the Guarantee
Obligations (as defined in Section 15.01 of the Indenture), which include (i)
the due and punctual payment of the principal of, premium, if any, and interest
and Additional Interest, if any, on the 3.50% Exchangeable Senior Notes due
2026 (the “Notes”) of Corporate Office
Properties, L.P., a Delaware limited partnership (the “Issuer”),
whether at maturity, by acceleration, call for redemption, upon a repurchase or
otherwise, the due and punctual payment of interest on the overdue principal
and premium, if any, and (to the extent permitted by law) interest on any
interest on the Notes, and the due and punctual performance of all other
obligations of the Issuer, to the Holders of the Notes or the Trustee all in
accordance with the terms set forth in Article 15 of the Indenture, and (ii) in
case of any extension of time of payment or renewal of any Notes or any such
other obligations, that the same shall be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
maturity, by acceleration, call for redemption, upon a repurchase or otherwise.

The obligations of the Guarantor to the Holders of the
Notes and to the Trustee pursuant to this Guarantee and the Indenture are
expressly set forth in Article 15 of the Indenture and reference is hereby made
to such Indenture for the precise terms of this Guarantee.

No past, present or future trustee, officer, employee,
incorporator or shareholder (direct or indirect) of the Guarantor (or any such
successor entity), as such, shall have any liability for any obligations of the
Guarantor under this Guarantee or the Indenture or for any claim based on, in
respect of, or by reason of, such obligations or their creation.

The Guarantor hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of merger or
bankruptcy of the Issuer, any right to require a proceeding first against the
Issuer, the benefit of discussion, protest or notice with respect to the Notes
and all demands whatsoever.

This is a continuing Guarantee and shall remain in
full force and effect and shall be binding upon the Guarantor and its
successors and assigns until full and final payment of all of the Issuer’s
obligations under the Notes and Indenture or until legally discharged in
accordance with the Indenture and shall inure to the benefit of the successors
and assigns of the Trustee and the Holders of the Notes, and, in the event of
any transfer or assignment of rights by any Holder of the Notes or the Trustee,
the rights and privileges herein conferred upon that party shall automatically
extend to and be vested in such transferee or assignee, all subject to the
terms and conditions hereof. This is a Guarantee of payment and performance and
not of collectibility.

This Guarantee shall not
be valid or obligatory for any purpose until the certificate of authentication
on the Note upon which this Guarantee is noted shall have been executed by the
Trustee under the Indenture by the manual or facsimile signature of one of its
authorized officers.

The obligations of the
Guarantor under this Guarantee shall be limited to the extent necessary to
insure that it does not constitute a fraudulent conveyance under applicable
law.

THE TERMS OF ARTICLE 15
OF THE INDENTURE ARE INCORPORATED HEREIN BY REFERENCE. Capitalized terms used
herein have the same meanings given in the Indenture unless otherwise
indicated.

 A-2
 

 

IN WITNESS WHEREOF, the Guarantor has caused this
instrument to be duly executed.

Dated: September 18, 2006

	
   

  	
  CORPORATE OFFICE PROPERTIES
  TRUST

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 A-3
 

 

EXCHANGE NOTICE

TO:         CORPORATE OFFICE PROPERTIES, L.P.

WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee

The undersigned registered owner of this Note hereby
irrevocably exercises the option to exchange this Note, or the portion thereof
(which is $1,000 or a multiple thereof) below designated, into cash and, if
applicable, Common Shares, cash, or a combination thereof, as the case may be,
at the election of the Issuer, in accordance with the terms of the Indenture
referred to in this Note, and directs that the Common Shares, if any, issuable
and deliverable upon such exchange, together with any check in payment for
cash, if any, payable upon exchange or for fractional shares and any

Notes representing any unexchanged principal amount
hereof, be issued and delivered to the registered holder hereof unless a
different name has been indicated below. Capitalized terms used herein but not
defined shall have the meanings ascribed to such terms in the Indenture. If
shares or any portion of this Note not exchanged are to be issued in the name
of a person other than the undersigned, the undersigned will provide the
appropriate information below and pay all transfer taxes payable with respect
thereto. Any amount required to be paid by the undersigned on account of
interest accompanies this Note.

The undersigned registered owner of this Note hereby
certifies that it or the Person on whose behalf the Notes are being exchanged
is a qualified institutional buyer within the meaning of Rule 144A under the
Securities Act of 1933, as amended.

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature(s)

  
	
   

  	
   

  
	
   

  	
  Signature(s)
  must be guaranteed by an “eligible guarantor
  institution” meeting the requirements of the Note Registrar, which
  requirements include membership or participation in the Security Transfer
  Agent Medallion Program (“STAMP”) or
  such other “signature guarantee program” as
  may be determined by the Note Registrar in addition to, or in substitution
  for, STAMP, all in accordance with the Securities Exchange Act of 1934, as
  amended.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature
  Guarantee

  

 

 A-4
 

 

Fill in the registration of Common Shares, if any, if
to be issued, and Notes if to be delivered, and the person to whom cash and
payment for fractional shares is to be made, if to be made, other than to and
in the name of the registered holder:

	
  Please print name and
  address

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  (Name)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (Street Address)

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  (City, State and
  Zip Code)

  	
   

  
	
   

  	
   

  
	
  Principal amount
  to be exchanged (if less than all):

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Social Security
  or Other Taxpayer Identification Number:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
				

 

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

 A-5
 

 

REPURCHASE NOTICE

TO:         CORPORATE OFFICE PROPERTIES, L.P.

WELLS FARGO BANK, NATIONAL ASSOCIATION

The undersigned registered owner of this Note hereby
irrevocably acknowledges receipt of a notice from Corporate Office Properties,
L.P. (the “Issuer”) regarding the right of
Holders to elect to require the Issuer to repurchase the Notes and requests and
instructs the Issuer to repay the entire principal amount of this Note, or the
portion thereof (which is $1,000 or an integral multiple thereof) below
designated, in cash, in accordance with the terms of the Indenture at the price
of 100% of such entire principal amount or portion thereof, together with
accrued and unpaid interest to, but excluding, the Repurchase Date or the
Fundamental Change Repurchase Date, as the case may be, to the registered holder
hereof. Capitalized terms used herein but not defined shall have the meanings
ascribed to such terms in the Indenture. The Notes shall be repurchased by the
Issuer as of the Put Right Repurchase Date or the Fundamental Change Repurchase
Date, as the case may be, pursuant to the terms and conditions specified in the
Indenture.

NOTICE: The above
signatures of the holder(s) hereof must correspond with the name as written
upon the face of the Note in every particular without alteration or enlargement
or any change whatever. Note Certificate Number (if applicable):

Principal amount to be
repurchased (if less than all, must be $1,000 or whole multiples thereof):  

Social Security or Other Taxpayer Identification
Number:                                      

	
  Dated: 

  	
   

  	
   

  	
   

  
	
   

  	
  

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature(s)

  
	
   

  	
   

  
	
   

  	
  Signature(s)
  must be guaranteed by an “eligible guarantor
  institution” meeting the requirements of the Note Registrar, which
  requirements include membership or participation in the Security Transfer
  Agent Medallion Program (“STAMP”) or
  such other “signature guarantee program” as
  may be determined by the Note Registrar in addition to, or in substitution
  for, STAMP, all in accordance with the Securities Exchange Act of 1934, as
  amended.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature
  Guarantee

  

 

 A-6
 

 

ASSIGNMENT

For value received                                                
hereby sell(s) assign(s) and transfer(s) unto                                                
(Please insert social security or other Taxpayer Identification Number of
assignee) the within Note, and hereby irrevocably constitutes and appoints                                                        
attorney to transfer said Note on the books of the Issuer, with full power of
substitution in the premises.

In connection with any transfer of the Note, the
undersigned confirms that such Note is being transferred:

o                                    To Corporate Office Properties, L.P., Corporate Office
Properties Trust or a subsidiary of Corporate Office Properties, L.P.; or

o                                    To a “qualified institutional
buyer” in compliance with Rule 144A under the Securities Act of
1933, as amended.

Unless one of the boxes is
checked, the Trustee will refuse to register any of the Notes evidenced by this
certificate in the name of any person other than the registered holder thereof.

	
  Dated: 

  	
   

  	
   

  	
   

  
	
   

  	
  

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature(s)

  
	
   

  	
   

  
	
   

  	
  Signature(s)
  must be guaranteed by an “eligible guarantor
  institution” meeting the requirements of the Note Registrar, which
  requirements include membership or participation in the Security Transfer
  Agent Medallion Program (“STAMP”) or
  such other “signature guarantee program” as
  may be determined by the Note Registrar in addition to, or in substitution
  for, STAMP, all in accordance with the Securities Exchange Act of 1934, as
  amended.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature
  Guarantee

  

 

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

 A-7
 

 

ASSIGNMENT

For value received                                                           
hereby sell(s) assign(s) and transfer(s) unto                                                           
(Please insert social security or other Taxpayer Identification Number of
assignee)                                                           
Common Shares, and hereby irrevocably constitutes and appoints                                                           
attorney to transfer said Common Shares on the books of the Issuer, with full
power of substitution in the premises.

In connection with any transfer of the Common Shares
prior to the expiration of the holding period applicable to sales thereof under
Rule 144(k) under the Securities Act (or any successor provision) (other than
any transfer pursuant to a registration statement that has been declared
effective under the Securities Act), the undersigned confirms that such Common
Shares are being transferred:

o                                    To Corporate Office Properties, L.P., Corporate Office
Properties Trust or a subsidiary of Corporate Office Properties, L.P.; or

o                                    Pursuant to and in compliance with Rule 144 under the
Securities Act of 1933, as amended; or

o                                    To a person the undersigned reasonably believes is a
qualified institutional buyer that is purchasing for its own account or for the
account of another qualified institutional buyer and to whom notice is given
that the transfer is being made in reliance on Rule 144A, all in compliance
with Rule 144A (if available); or

o                                    Pursuant to a Registration Statement which has been
declared effective under the Securities Act of 1933, as amended, and which
continues to be effective at the time of transfer.

Unless one of the boxes is
checked, the Transfer Agent will refuse to register any of the Common Shares
evidenced by this certificate in the name of any person other than the
registered holder thereof.

 A-8
 

 

[Include Schedule I only for a Global Note]

SCHEDULE OF INCREASES OR
DECREASES IN NOTE

The initial principal amount of this Global Note is                                 
($                           ).
The following increases or decreases in part of this Note have been made:

	
  Date

  	
   

  	
  Amount of

  Increase in

  Principal

  Amount of this

  Note

  	
   

  	
  Amount of

  Decrease in

  Principal

  Amount of this

  Note

  	
   

  	
  Principal

  Amount of this

  Note following

  such Increase or

  Decrease

  	
   

  	
  Signature of Authorized

  Officer or Trustee

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

r

 A-9

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