Document:

Exhibit 4.06

 

PRINCIPAL
FINANCIAL GROUP, INC.

 

and

 

PRINCIPAL
FINANCIAL SERVICES, INC.,

 

as guarantor

 

to

 

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

 

as Trustee

 

SUBORDINATED
INDENTURE

Dated as of            

 

 

Table of Contents

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  
	
  Article One

  	
   

  
	
   

  	
   

  
	
  Definitions and Other Provisions of
  General Application

  	
   

  
	
   

  	
   

  
	
  Section 101.

  	
  Definitions

  	
  1

  
	
  Section 102.

  	
  Compliance Certificates and Opinions

  	
  10

  
	
  Section 103.

  	
  Form of Documents Delivered to Trustee

  	
  10

  
	
  Section 104.

  	
  Acts of Holders; Record Dates.

  	
  11

  
	
  Section 105.

  	
  Notices, Etc., to Trustee, Company and Subsidiary
  Guarantor

  	
  13

  
	
  Section 106.

  	
  Notice to Holders; Waiver

  	
  14

  
	
  Section 107.

  	
  Conflict with Trust Indenture Act

  	
  14

  
	
  Section 108.

  	
  Effect of Headings and Table of Contents

  	
  15

  
	
  Section 109.

  	
  Successors and Assigns

  	
  15

  
	
  Section 110.

  	
  Separability Clause

  	
  15

  
	
  Section 111.

  	
  Benefits of Indenture

  	
  15

  
	
  Section 112.

  	
  Governing Law; Waiver of Jury Trial

  	
  15

  
	
  Section 113.

  	
  Legal Holidays

  	
  15

  
	
  Section 114.

  	
  Computations

  	
  15

  
	
  Section 115.

  	
  Force Majeure

  	
  16

  
	
   

  	
   

  	
   

  
	
  Article Two

  	
   

  
	
   

  	
   

  
	
  Security Forms

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 201.

  	
  Forms Generally

  	
  16

  
	
  Section 202.

  	
  Form of Legend for Global Securities

  	
  17

  
	
  Section 203.

  	
  Form of Trustee’s Certificate of Authentication

  	
  17

  
	
   

  	
   

  	
   

  
	
  Article Three

  	
   

  
	
   

  	
   

  	
   

  
	
  The Securities

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 301.

  	
  Title; Terms

  	
  18

  
	
  Section 302.

  	
  Denominations

  	
  21

  
	
  Section 303.

  	
  Execution, Authentication, Delivery and Dating

  	
  21

  
	
  Section 304.

  	
  Temporary Securities

  	
  23

  
	
  Section 305.

  	
  Registration; Registration of Transfer and Exchange

  	
  23

  
	
  Section 306.

  	
  Mutilated, Destroyed, Lost and Stolen Securities

  	
  25

  
	
  Section 307.

  	
  Payment of Interest; Interest Rights Preserved

  	
  26

  
	
  Section 308.

  	
  Persons Deemed Owners

  	
  28

  
	
  Section 309.

  	
  Cancellation

  	
  28

  
	
  Section 310.

  	
  Computation of Interest

  	
  28

  
				

 

i

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 311.

  	
  CUSIP Numbers

  	
  29

  
	
   

  	
   

  	
   

  
	
  Article Four

  	
   

  
	
   

  	
   

  
	
  Satisfaction and Discharge

  	
   

  
	
   

  	
   

  
	
  Section 401.

  	
  Satisfaction and Discharge of Indenture

  	
  29

  
	
  Section 402.

  	
  Application of Trust Money

  	
  30

  
	
   

  	
   

  	
   

  
	
  Article Five

  	
   

  
	
   

  	
   

  	
   

  
	
  Remedies

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 501.

  	
  Events of Default

  	
  31

  
	
  Section 502.

  	
  Acceleration of Maturity; Rescission and Annulment

  	
  32

  
	
  Section 503.

  	
  Collection of Indebtedness and Suits for Enforcement
  by Trustee

  	
  33

  
	
  Section 504.

  	
  Trustee May File Proofs of Claim

  	
  34

  
	
  Section 505.

  	
  Trustee May Enforce Claims Without Possession
  of Securities

  	
  34

  
	
  Section 506.

  	
  Application of Money Collected

  	
  35

  
	
  Section 507.

  	
  Limitation on
  Suits

  	
  35

  
	
  Section 508.

  	
  Unconditional Right of Holders to Receive Principal,
  Premium and Interest

  	
  36

  
	
  Section 509.

  	
  Restoration of Rights and Remedies

  	
  36

  
	
  Section 510.

  	
  Rights and Remedies Cumulative

  	
  36

  
	
  Section 511.

  	
  Delay or Omission Not Waiver

  	
  37

  
	
  Section 512.

  	
  Control by Holders

  	
  37

  
	
  Section 513.

  	
  Waiver of Past Defaults

  	
  37

  
	
  Section 514.

  	
  Undertaking for Costs

  	
  37

  
	
  Section 515.

  	
  Waiver of Usury, Stay or Extension Laws

  	
  38

  
	
   

  	
   

  	
   

  
	
  Article Six

  	
   

  
	
   

  	
   

  	
   

  
	
  The Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 601.

  	
  Certain Duties and Responsibilities.

  	
  38

  
	
  Section 602.

  	
  Notice of Defaults

  	
  39

  
	
  Section 603.

  	
  Certain Rights of Trustee

  	
  40

  
	
  Section 604.

  	
  Not Responsible for Recitals or Issuance of
  Securities

  	
  42

  
	
  Section 605.

  	
  May Hold Securities

  	
  42

  
	
  Section 606.

  	
  Money Held in Trust

  	
  42

  
	
  Section 607.

  	
  Compensation and Reimbursement

  	
  42

  
	
  Section 608.

  	
  Disqualification; Conflicting Interests

  	
  43

  

 

ii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 609.

  	
  Corporate Trustee Required; Eligibility

  	
  43

  
	
  Section 610.

  	
  Resignation and Removal; Appointment of Successor

  	
  44

  
	
  Section 611.

  	
  Acceptance of Appointment by Successor.

  	
  45

  
	
  Section 612.

  	
  Merger, Conversion, Consolidation or Succession to
  Business

  	
  47

  
	
  Section 613.

  	
  Preferential Collection of Claims Against Company

  	
  47

  
	
  Section 614.

  	
  Appointment of Authenticating Agent

  	
  47

  
	
   

  	
   

  	
   

  
	
  Article Seven

  	
   

  
	
   

  	
   

  
	
  Holders’ Lists and Reports by
  Trustee and Company

  	
   

  
	
   

  	
   

  
	
  Section 701.

  	
  Company to Furnish Trustee Names and Addresses of
  Holders

  	
  49

  
	
  Section 702.

  	
  Preservation of Information; Communications to
  Holders

  	
  49

  
	
  Section 703.

  	
  Reports by Trustee

  	
  50

  
	
  Section 704.

  	
  Reports by Company

  	
  50

  
	
   

  	
   

  	
   

  
	
  Article Eight

  	
   

  
	
   

  	
   

  
	
  Consolidation, Merger, Conveyance,
  Transfer or Lease

  	
   

  
	
   

  	
   

  
	
  Section 801.

  	
  Company May Consolidate, Etc., Only on Certain
  Terms

  	
  51

  
	
  Section 802.

  	
  Successor Corporation Substituted

  	
  52

  
	
   

  	
   

  	
   

  
	
  Article Nine

  	
   

  
	
   

  	
   

  
	
  Supplemental Indentures

  	
   

  
	
   

  	
   

  
	
  Section 901.

  	
  Supplemental Indentures Without Consent of Holders

  	
  52

  
	
  Section 902.

  	
  Supplemental Indentures With Consent of Holders

  	
  54

  
	
  Section 903.

  	
  Execution of Supplemental Indentures

  	
  55

  
	
  Section 904.

  	
  Effect of Supplemental Indentures

  	
  55

  
	
  Section 905.

  	
  Conformity with Trust Indenture Act

  	
  56

  
	
  Section 906.

  	
  Reference in Securities to Supplemental Indentures

  	
  56

  
	
   

  	
   

  	
   

  
	
  Article Ten

  	
   

  
	
   

  	
   

  
	
  Covenants

  	
   

  
	
   

  	
   

  
	
  Section 1001.

  	
  Payment of Principal, Premium and Interest

  	
  56

  
	
  Section 1002.

  	
  Maintenance of Office or Agency

  	
  56

  
	
  Section 1003.

  	
  Money for Securities Payments to Be Held in Trust

  	
  57

  
	
  Section 1004.

  	
  Statement by Officers as to Default

  	
  58

  

 

iii

 

	
   

  	
  Page

  
	
   

  	
   

  
	
  Section 1005.

  	
  Existence

  	
  58

  
	
  Section 1006.

  	
  Payment of Taxes

  	
  58

  
	
  Section 1007.

  	
  Limitation on
  Liens

  	
  59

  
	
  Section 1008.

  	
  Waiver of Certain Covenants

  	
  59

  
	
  Section 1009.

  	
  Calculation of Original Issue Discount

  	
  59

  
	
   

  	
   

  	
   

  
	
  Article Eleven

  	
   

  
	
   

  	
   

  
	
  Redemption of Securities

  	
   

  
	
   

  	
   

  
	
  Section 1101.

  	
  Company’s Right of Redemption

  	
  60

  
	
  Section 1102.

  	
  Applicability of Article

  	
  60

  
	
  Section 1103.

  	
  Election to Redeem; Notice to Trustee

  	
  60

  
	
  Section 1104.

  	
  Selection by Trustee of Securities to Be Redeemed

  	
  60

  
	
  Section 1105.

  	
  Notice of Redemption

  	
  61

  
	
  Section 1106.

  	
  Deposit of Redemption Price

  	
  62

  
	
  Section 1107.

  	
  Securities Payable on Redemption Date

  	
  62

  
	
  Section 1108.

  	
  Securities Redeemed in Part

  	
  63

  
	
   

  	
   

  	
   

  
	
  Article Twelve

  	
   

  
	
   

  	
   

  
	
  Subordination of Securities

  	
   

  
	
   

  	
   

  
	
  Section 1201.

  	
  Securities Subordinate to Senior Indebtedness of the
  Company

  	
  63

  
	
  Section 1202.

  	
  Payment Over Proceeds Upon Dissolution, Etc

  	
  63

  
	
  Section 1203.

  	
  Prior Payment to Senior Indebtedness of the Company
  Upon Acceleration of Securities

  	
  65

  
	
  Section 1204.

  	
  No Payment When Senior Indebtedness of the Company
  in Default

  	
  65

  
	
  Section 1205.

  	
  Payment Permitted If No Default

  	
  66

  
	
  Section 1206.

  	
  Subrogation to Rights of Holders of Senior
  Indebtedness of the Company

  	
  66

  
	
  Section 1207.

  	
  Provisions Solely to Define Relative Rights

  	
  67

  
	
  Section 1208.

  	
  Trustee to Effectuate Subordination

  	
  67

  
	
  Section 1209.

  	
  No Waiver of Subordination Provisions

  	
  67

  
	
  Section 1210.

  	
  Notice to Trustee

  	
  68

  
	
  Section 1211.

  	
  Reliance on Judicial Order of Certificate of
  Liquidating Agent or Other Notices

  	
  68

  
	
  Section 1212.

  	
  Trustee Not Fiduciary for Holders of Senior
  Indebtedness of the Company

  	
  69

  
	
  Section 1213.

  	
  Rights of Trustee as Holder of
  Senior Indebtedness of the Company; Preservation of Trustee’s Rights

  	
  69

  
	
  Section 1214.

  	
  Article Applicable to Paying Agents

  	
  69

  

 

iv

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 1215.

  	
  Certain Conversions or Exchanges Deemed Payment

  	
  69

  
	
   

  	
   

  	
   

  
	
  Article Thirteen

  	
   

  
	
   

  	
   

  
	
  Subordination of Subsidiary
  Guarantee

  	
   

  
	
   

  	
   

  
	
  Section 1301.

  	
  Subsidiary Guarantee Subordinate to Senior Indebtedness
  of the Subsidiary Guarantor

  	
  70

  
	
  Section 1302.

  	
  Payment Over of Proceeds Upon Dissolution, Etc

  	
  70

  
	
  Section 1303.

  	
  Prior Payment to Senior
  Indebtedness of the Subsidiary Guarantor Upon Acceleration of Securities

  	
  72

  
	
  Section 1304.

  	
  No Payment When Senior Indebtedness of Subsidiary
  Guarantor in Default

  	
  72

  
	
  Section 1305.

  	
  Payment Permitted If No Default

  	
  73

  
	
  Section 1306.

  	
  Subrogation to Rights of Holders of Senior
  Indebtedness of the Subsidiary Guarantor

  	
  73

  
	
  Section 1307.

  	
  Provisions Solely to Define Relative Rights

  	
  74

  
	
  Section 1308.

  	
  Trustee to Effectuate Subordination

  	
  74

  
	
  Section 1309.

  	
  No Waiver of Subordination Provisions

  	
  75

  
	
  Section 1310.

  	
  Notice to Trustee

  	
  75

  
	
  Section 1311.

  	
  Reliance on Judicial Order of Certificate of
  Liquidating Agent or Other Notices

  	
  75

  
	
  Section 1312.

  	
  Trustee Not Fiduciary for Holders of Senior
  Indebtedness of the Subsidiary Guarantor

  	
  76

  
	
  Section 1313.

  	
  Rights of Trustee as Holder of
  Senior Indebtedness of the Subsidiary Guarantor; Preservation of Trustee’s
  Rights

  	
  76

  
	
  Section 1314.

  	
  Article Applicable to Paying Agents

  	
  77

  
	
  Section 1315.

  	
  Certain Conversions or Exchanges Deemed Payment

  	
  77

  
	
   

  	
   

  	
   

  
	
  Article Fourteen

  	
   

  
	
   

  	
   

  
	
  Defeasance and Covenant Defeasance

  	
   

  
	
   

  	
   

  
	
  Section 1401.

  	
  Company’s Option to Effect Defeasance or Covenant
  Defeasance

  	
  77

  
	
  Section 1402.

  	
  Defeasance and Discharge

  	
  77

  
	
  Section 1403.

  	
  Covenant Defeasance

  	
  78

  
	
  Section 1404.

  	
  Conditions to Defeasance or Covenant Defeasance

  	
  78

  
	
  Section 1405.

  	
  Deposited Money and Government
  Obligations to Be Held in Trust; Miscellaneous Provisions

  	
  80

  
	
  Section 1406.

  	
  Reinstatement

  	
  80

  
	
  Section 1407.

  	
  Qualifying Trustee

  	
  81

  
	
   

  	
   

  	
   

  
	
  Exhibit A:  Form of Security

  	
   

  

 

v

 

CERTAIN SECTIONS
OF THIS INDENTURE RELATING

TO SECTIONS 310 THROUGH 318,

INCLUSIVE OF THE TRUST INDENTURE ACT OF 1939:

 

	
  TRUST INDENTURE ACT SECTION

  	
   

  	
  INDENTURE SECTION

  
	
   

  	
   

  	
   

  
	
  SECTION 310(a)(1)

  	
   

  	
  609, 610

  
	
  (a)(2)

  	
   

  	
  609

  
	
  (a)(3)

  	
   

  	
  NOT APPLICABLE

  
	
  (a)(4)

  	
   

  	
  NOT APPLICABLE

  
	
  (a)(5)

  	
   

  	
  609

  
	
  (b)

  	
   

  	
  608, 610

  
	
  SECTION 311(a)

  	
   

  	
  613

  
	
  (b)

  	
   

  	
  613

  
	
  SECTION 312(a)

  	
   

  	
  701, 702

  
	
  (b)

  	
   

  	
  702

  
	
  (c)

  	
   

  	
  702

  
	
  SECTION 313(a)

  	
   

  	
  703

  
	
  (b)

  	
   

  	
  703

  
	
  (c)

  	
   

  	
  703

  
	
  (d)

  	
   

  	
  703

  
	
  SECTION 314(a)

  	
   

  	
  704

  
	
  (a)(4)

  	
   

  	
  101, 1004

  
	
  (b)

  	
   

  	
  NOT APPLICABLE

  
	
  (c)(1)

  	
   

  	
  102

  
	
  (c)(2)

  	
   

  	
  102

  
	
  (c)(3)

  	
   

  	
  NOT APPLICABLE

  
	
  (d)

  	
   

  	
  NOT APPLICABLE

  
	
  (e)

  	
   

  	
  102

  
	
  SECTION 315(a)

  	
   

  	
  601

  
	
  (b)

  	
   

  	
  602

  
	
  (c)

  	
   

  	
  601

  
	
  (d)

  	
   

  	
  601

  
	
  (e)

  	
   

  	
  514

  
	
  SECTION 316(a)

  	
   

  	
  101

  
	
  (a)(1)(a)

  	
   

  	
  502, 512

  
	
  (a)(1)(b)

  	
   

  	
  513

  
	
  (a)(2)

  	
   

  	
  NOT APPLICABLE

  
	
  (b)

  	
   

  	
  508

  
	
  (c)

  	
   

  	
  104

  
	
  SECTION 317(a)(1)

  	
   

  	
  503

  
	
  (a)(2)

  	
   

  	
  504

  

 

vi

 

	
  (b)

  	
   

  	
  1003

  
	
  SECTION 318(a)

  	
   

  	
  107

  

 

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

 

vii

 

SUBORDINATED INDENTURE,
dated as of
                          ,
between PRINCIPAL FINANCIAL GROUP, INC., a corporation duly organized and existing
under the laws of the State of Delaware (herein called the “Company”),
PRINCIPAL FINANCIAL SERVICES, INC., a corporation duly organized and existing
under the laws of the State of Iowa and a wholly-owned subsidiary of the
Company, as guarantor (herein called the “Subsidiary Guarantor”), each
having its principal office at 711 High Street, Des Moines, Iowa 50392, and THE BANK OF NEW YORK TRUST COMPANY, N.A.,
a national banking association incorporated and existing under the laws of the
United States of America, as Trustee (herein called the “Trustee”).

 

RECITALS OF THE
COMPANY AND THE SUBSIDIARY GUARANTOR

 

Each of the Company and
the Subsidiary Guarantor has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of the Company’s
unsecured subordinated debt securities in one or more series (the “Securities”)
of substantially the tenor hereinafter provided, and, if applicable, the
guarantee thereof by the Subsidiary Guarantor, on an unsecured subordinated
basis and subject to the limitations hereinafter provided, and to provide the
terms and conditions upon which the Securities are to be authenticated, issued
and delivered, and all things necessary to make the Securities, when executed
by the Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company, and, if applicable, any
guarantee, the valid obligation of the Subsidiary Guarantor, and to make this
Indenture a valid and legally binding agreement of the Company and, to the
extent applicable, the Subsidiary Guarantor, in accordance with its terms, have
been done.

 

NOW, THEREFORE, THIS
INDENTURE WITNESSETH:

 

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

 

ARTICLE ONE

 

Definitions
and Other Provisions of General Application

 

Section 101.                                Definitions.  For all purposes of this Indenture, except as
otherwise expressly provided or unless the context otherwise requires:

 

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

 

 

(2)                                  all
other terms used herein which are defined in the Trust Indenture Act, either
directly or by reference therein, have the meanings assigned to them therein;

 

(3)                                  all
accounting terms not otherwise defined herein have the meanings assigned to
them in accordance with generally accepted accounting principles, and, except
as otherwise herein expressly provided, the term “generally accepted accounting
principles” with respect to any computation required or permitted hereunder
shall mean such accounting principles as are generally accepted at the time of
such computation; provided, that when two or more principles are so
generally accepted, it shall mean that set of principles consistent with those
in use by the Company;

 

(4)                                  unless
the context otherwise requires, any reference to an “Article” or a “Section”
refers to an Article or a Section, as the case may be, of this Indenture;
and

 

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

 

“Act” when used with respect to any Holder, has the meaning
specified in Section 104.

 

“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 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.

 

“Authenticating Agent” means any Person authorized by the
Trustee pursuant to Section 614 to act on behalf of the Trustee to
authenticate Securities.

 

“Board of Directors” means the board of directors of the Company
or the Subsidiary Guarantor, as applicable, any duly authorized committee of
that board or any officer of the Company or the Subsidiary Guarantor, as
applicable, delegated the power of either the board of directors of the Company
or the Subsidiary Guarantor, as applicable, or any duly authorized committee of
that board.

 

“Board Resolution” means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company or the Subsidiary Guarantor,
as applicable, to have 

 

2

 

been
duly adopted by the Board of Directors and to be in full force and effect on
the date of such certification, and delivered to the Trustee.

 

“Business Day” means each Monday, Tuesday, Wednesday, Thursday
and Friday which is not a day on which the Corporate Trust Office, banking
institutions in New York, New York, Chicago, Illinois or Des Moines, Iowa, or
any Place of Payment are authorized or obligated by law or executive order to
close.

 

“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 instrument 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.

 

“Company” means the Person named as the “Company” in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter “Company”
shall mean such successor Person.

 

“Company Request” and “Company Order” mean, respectively,
a written request or order signed in the name of the Company by (i) its
Chairman, President, Chief Executive Officer, any Vice President or any other
person duly authorized from time to time by the Company or its Board of
Directors and (ii) its Treasurer, any Associate Treasurer, any
Director, Corporate Treasury, its Controller, its Secretary, any Assistant
Secretary or any other person duly authorized from time to time by the Company
or its Board of Directors, and delivered to the Trustee or, with respect to
Company Requests and Company Orders delivered pursuant to Sections 303, 304,
305 and 603, any other employee of the Company named in an Officers’
Certificate delivered to the Trustee.

 

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

 

“corporation” means a corporation, association, company,
joint-stock company or business trust.

 

“Covenant Defeasance” has the meaning specified in Section 1403.

 

“Defaulted Interest” has the meaning specified in Section 307.

 

“Defeasance” has the meaning specified in Section 1402.

 

3

 

“Depositary” means the clearing agency registered under the
Exchange Act that is designated by the Company in Section 301 to act as
depositary for any series of Securities with respect to such series (or any
successor to such clearing agency).

 

“Dollar” means the currency of the United States of America as
at the time of payment is legal tender for the payment of public and private
debts.

 

“Event of Default,” unless otherwise specified with respect to
Securities of a series pursuant to Section 301, has the meaning specified
in Section 501.

 

“Exchange Act” means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.

 

“Expiration Date” has the meaning specified in Section 104.

 

“Foreign Currency” means any currency issued (1) by the
government of one or more countries other than the United States of America or (2) by
any recognized confederation or association of such governments that is
reasonably acceptable to the Trustee.

 

“Global Security” means a Security that evidences all or part of
a series of Securities issued to the Depositary or its nominee for such series,
and registered in the name of such Depositary or its nominee and bearing the
legend set forth in Section 202.

 

“Governmental Authority” means any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or regulatory
body.

 

“Government Obligations” means, with respect to the Securities
of any series, securities which are (i) direct obligations of the
United States of America or (ii) obligations of a Person controlled
or supervised by and acting as an agency or instrumentality of the United
States of America the payment of which is unconditionally guaranteed by the
United States of America and which, in either case, are full faith and credit
obligations of the United States of America and are not callable or redeemable
at the option of the issuer thereof and shall also include a depository receipt
issued by a bank (as defined in Section 3(a)(2) of the Securities
Act) as custodian with respect to any such Government Obligation held by such
custodian for the account of the holder of such depository receipt; provided
that (except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository receipt from
any amount received by the custodian in respect of the Government Obligation or
the specific payment of interest on or principal of the Government Obligation
evidenced by such depository receipt.

 

“Holder” means a Person in whose name a Security is registered
in the Security Register.

 

4

 

“Indebtedness” of any Person means the principal of (and
premium, if any), and interest due on indebtedness of such Person, whether
outstanding on the date of this Indenture or thereafter created, incurred or
assumed, whether recourse is to all or a portion of the assets of such Person
and whether or not contingent which is (a) indebtedness for money
borrowed, and (b) any amendments, renewals, extensions,
modifications and refundings of any such indebtedness.  For the purposes of this definition, “indebtedness
for money borrowed” means (i) any obligation of, or any obligation
guaranteed by, such Person for the repayment of borrowed money, whether or not
evidenced by bonds, debentures, notes or other written instruments, (ii) any
obligation of, or any such obligation guaranteed by, such Person evidenced by
bonds, debentures, notes or similar written instruments, including obligations
assumed or incurred in connection with the acquisition of property, assets or
businesses (provided, however, that the deferred purchase price
of any property, assets or business shall not be considered Indebtedness if the
purchase price thereof is payable in full within 90 days from the date on which
such indebtedness was created), and (iii) any obligations of such
Person as lessee under leases required to be capitalized on the balance sheet
of the lessee under generally accepted accounting principles and leases of
property or assets made as part of any sale and lease-back transaction to which
such Person is a party.  Indebtedness
does not include trade accounts payable or accrued liabilities arising in the
ordinary course of business.

 

“Indenture” means this instrument as originally executed or as
it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
and shall include the terms of each particular series of Securities established
as contemplated by Section 301, including, for all purposes of this
instrument and any such supplemental indenture, the provisions of the Trust
Indenture Act that are deemed to be a part of and govern this instrument and
any such supplemental indenture, respectively.

 

“Interest Payment Date” means as to each series of Securities
the Stated Maturity of an installment of interest on such Securities.

 

“Interest Rate” means the rate of interest specified or
determined as specified in each Security as being the rate of interest payable
on such Security.

 

“Investment Company Act” means the Investment Company Act of
1940 and any statute successor thereto, in each case as amended from time to
time.

 

“Junior Subordinated Payment” has the meaning specified in Section 1202.

 

“Lien” means any mortgage, pledge, lien, security interest or
other encumbrance.

 

“Maturity” when used with respect to any Security, means the
date on which the principal of such Security or an installment of principal
becomes due and payable as 

 

5

 

provided
in the Securities or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.

 

“Notice of Default” means a written notice of the kind specified
in Section 501(3).

 

“Officers’ Certificate” means a certificate signed by (i) the
Chairman, President, Chief Executive Officer or any Vice President, and (ii) the
Treasurer, any Associate Treasurer, any Assistant Treasurer, the Controller,
the Secretary or any Assistant Secretary, of the Company or the Subsidiary
Guarantor, as applicable, and delivered to the Trustee.  One of the officers signing an Officers’
Certificate given pursuant to Section 1004 shall be the principal
executive, financial or accounting officer of the Company.

 

“Opinion of Counsel” means a written opinion of counsel, who may
be counsel for (and an employee of) the Company or the Subsidiary Guarantor, as
applicable.

 

“Original Issue Date” means the date of issuance specified as
such in each Security.

 

“Original Issue Discount Security” means any security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 502.

 

“Outstanding” when used with respect to Securities, means, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:

 

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

 

(2)                                  Securities
for whose payment or redemption money in the necessary amount has been
theretofore deposited with the Trustee or any Paying Agent (other than the
Company) in trust or set aside and segregated in trust by the Company (if the
Company shall act as its own Paying Agent) for the Holders of such Securities; provided
that, if such Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor satisfactory to the
Trustee has been made; and

 

(3)                                  Securities
which have been paid pursuant to Section 306 or in exchange for or in lieu
of which other Securities have been authenticated and delivered pursuant to
this Indenture, other than any such Securities in respect of which there shall
have been presented to the Trustee proof satisfactory to it that such
Securities are held by Holders in whose hands such Securities are valid,
binding and legal obligations of the Company;

 

6

 

provided,
however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (A) the principal amount of an
Original Issue Discount Security which shall be deemed to be Outstanding shall
be the amount of the principal thereof which would be due and payable as of
such date upon acceleration of the Maturity thereof to such date pursuant to Section 502,
(B) if, as of such date, the principal amount payable at the Stated
Maturity of a Security is not determinable, the principal amount of such
Security which shall be deemed to be Outstanding shall be the amount as
specified or determined as contemplated by Section 301, and (C) Securities
beneficially owned by the Company or any other obligor upon the Securities or
any Affiliate of the Company or of such other obligor shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the Trustee
shall be protected in conclusively relying upon any such request, demand,
authorization, direction, notice, consent, waiver or other action, only
Securities which a Responsible Officer of the Trustee knows to be so owned
shall be so disregarded.  Securities so
owned which have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Trustee the pledgee’s right so
to act with respect to such Securities and that the pledgee is not the Company
or any other obligor upon the Securities or any Affiliate of the Company or of
such other obligor.

 

“Paying Agent” means the Trustee or any other Person authorized
by the Company to pay the principal of or any premium or interest on any
Securities on behalf of the Company.

 

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

 

“Place of Payment” means, with respect to the Securities of any
series, the place or places where the principal of and any premium and interest
on the Securities of such series are payable as specified as contemplated by Section 301.

 

“Predecessor Security” of any particular Security means every
previous Security evidencing all or a portion of the same debt as that
evidenced by such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 306 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Security
shall be deemed to evidence the same debt as the mutilated, destroyed, lost or
stolen Security.

 

“Preferred Stock” shall mean any capital stock entitled by its
terms to a preference (a) as to dividends or (b) upon a
distribution of assets.

 

“Proceeding” has the meaning specified in Section 1202.

 

7

 

“Redemption Date” when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.

 

“Redemption Price” when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.

 

“Regular Record Date” for the interest payable on any Interest
Payment Date on the Securities of a series means, unless otherwise provided
pursuant to Section 301 with respect to Securities of a series, the date
which is fifteen days next preceding such Interest Payment Date (whether or not
a Business Day).

 

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

 

“Restricted Subsidiary” means Principal Life Insurance Company
and any other Subsidiary which is incorporated in any State of the United
States or in the District of Columbia and which is a regulated insurance
company principally engaged in one or more of the life, annuity, property and
casualty insurance businesses, provided that no such Subsidiary, other
than Principal Life Insurance Company, shall be a Restricted Subsidiary if (i) the
total assets of such Subsidiary are less than 10% of the total assets of the
Company and its consolidated Subsidiaries (including such Subsidiary), in each
case as set forth on the most recent fiscal year-end balance sheets of such
Subsidiary and the Company and its consolidated Subsidiaries, respectively, and
computed in accordance with generally accepted accounting principles, or (ii) in
the judgment of the Board of Directors, as evidenced by a Board Resolution,
such Subsidiary is not material to the financial condition of the Company and
its consolidated Subsidiaries taken as a whole.

 

“Securities” or “Security” means any debt securities or
debt security, as the case may be, authenticated and delivered under this
Indenture.

 

“Securities Act” means the Securities Act of 1933 and any
statute successor thereto, in each case as amended from time to time.

 

“Security Register” and “Security Registrar” have the
respective meanings specified in Section 305.

 

“Senior Indebtedness” means the principal of (and premium, if
any) and interest, if any (including interest accruing on or after the filing
of any petition in bankruptcy or for reorganization relating to the Company or
the Subsidiary Guarantor, as applicable, 

 

8

 

whether
or not such claim for post-petition interest is allowed in such proceeding), on
Indebtedness (of the Company or the Subsidiary Guarantor, as applicable),
whether incurred on or prior to the date of this Indenture or thereafter
incurred, unless, in the instrument creating or evidencing the same or pursuant
to which the same is outstanding or pursuant to the terms established pursuant
to Section 301 hereof, it is provided that such obligations are not
superior in right of payment to the Securities or to other Indebtedness which
is pari passu with, or subordinated to, the Securities.

 

“Special Record Date” for the payment of any Defaulted Interest
means a date fixed by the Trustee pursuant to Section 307.

 

“Stated Maturity” when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such installment of principal or interest is due and payable, in the case of
such principal or installment of principal, as such date may be extended or
shortened as provided pursuant to the terms of such Security.

 

“Subsidiary” means a corporation, partnership or other entity of
which, at the time of determination, more than 50% of the outstanding voting
stock or equivalent interest is owned, directly or indirectly, by the Company
or by one or more other Subsidiaries, or by the Company and one or more other
Subsidiaries.  For the purposes of this
definition, “voting stock” means stock which ordinarily has voting power for
the election of directors, whether at all times or only so long as no senior
class of stock has such voting power by reason of any contingency.

 

“Subsidiary Guarantee” when used with respect to the Securities
of or within any series, means a guarantee by the Subsidiary Guarantor, on an
unsecured subordinated basis, of the obligations of the Company under the
Securities, which guarantee may be included in an indenture or indentures
supplemental hereto; provided, however, that the Subsidiary
Guarantor may guarantee, on an unsecured subordinated basis, only obligations
of the Company under non-convertible Securities.

 

“Subsidiary Guarantor” means the Person named as the “Subsidiary
Guarantor” in the first paragraph of this instrument and its successors and
assigns.

 

“Trust Indenture Act” means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed; provided,
however, that in the event the Trust Indenture Act of 1939 is amended
after such date, “Trust Indenture Act” means, to the extent required by
any such amendment, the Trust Indenture Act of 1939 as so amended.

 

“Trustee” means the Person named as the “Trustee” in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable 

 

9

 

provisions
of this Indenture, and thereafter “Trustee” shall mean or include each Person
who is then a Trustee hereunder, and, if at any time there is more than one
such Person, “Trustee” as used with respect to the Securities of any series
shall mean the Trustee with respect to the Securities of that series.

 

“Vice President” when used with respect to the Company or the
Trustee, means any officer with a title of “Vice President”, “Senior Vice
President” or “Executive Vice President”.

 

Section 102.                                Compliance
Certificates and Opinions.  Upon any
application or request by the Company or the Subsidiary Guarantor to the
Trustee to take any action under any provision of this Indenture, the Company
or the Subsidiary Guarantor, as the case may be, shall furnish to the Trustee
such certificates and opinions as may be required under the Trust Indenture
Act.  Each such certificate or opinion
shall be given in the form of an Officers’ Certificate, if to be given by an
officer of the Company or the Subsidiary Guarantor, or an Opinion of Counsel,
if to be given by counsel, and shall comply with the requirements of the Trust
Indenture Act and any other requirements set forth in this Indenture.  In the case of an application or request as
to which the furnishing of such documents is specifically required by any
provision of this Indenture relating to such particular application or request,
no additional certificate or opinion need be furnished.

 

Every certificate or
opinion with respect to compliance with a condition or covenant provided for in
this Indenture (other than the certificates provided pursuant to Section 1004)
shall include:

 

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

 

(2)                                  a
brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions contained in such certificate or opinion
are based;

 

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

 

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

 

Section 103.                                Form of
Documents Delivered to Trustee.  In
any case where several matters are required to be certified by, or covered by
an opinion of, any specified Person, it is not necessary that all such matters
be certified by, or covered by the opinion 

 

10

 

of, only one such Person,
or that they be so certified or covered by only one document, but one such
Person may certify or give an opinion with respect to some matters and one or
more other such Persons as to other matters, and any such Person may certify or
give an opinion as to such matters in one or several documents.

 

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

 

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

 

Section 104.                                Acts of Holders;
Record Dates.

 

(a)                                  Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Indenture to be given, made or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent
duly appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company and
the Subsidiary Guarantor.  Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the “Act” of the Holders signing
such instrument or instruments.  Proof of
execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and (subject to Section 601)
conclusive and may be relied upon by the Trustee, the Company, the Subsidiary
Guarantor and any agent of the Trustee, the Company or the Subsidiary
Guarantor, if made in the manner provided in this Section.

 

(b)                                 The
fact and date of the execution by any Person of any such instrument or writing
may be proved by the affidavit of a witness of such execution or by a
certificate of any notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such
instrument or writing acknowledged to him the execution thereof.  Where such execution is by a Person acting in
a capacity 

 

11

 

other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority.

 

(c)                                  The
fact and date of the execution by any Person of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which the Trustee deems sufficient and in accordance with such
reasonable rules as the Trustee may determine.

 

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

 

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

 

(f)                                    The
Company may, but shall not be obligated to, set any day as a record date for
the purpose of determining the Holders of Outstanding Securities entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities, provided that the Company may
not set a record date for, and the provisions of this paragraph shall not apply
with respect to, the giving or making of any notice, declaration, request or
direction referred to in the next paragraph. 
If any record date is set pursuant to this paragraph, the Holders of
Outstanding Securities on such record date, and no other Holders, shall be
entitled to take the relevant action, whether or not such Holders remain
Holders after such record date; provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
(as defined below) by Holders of the requisite principal amount of Outstanding
Securities on such record date.  Nothing
in this paragraph shall be construed to prevent the Company from setting a new
record date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be cancelled and of no effect),
and nothing in this paragraph shall be construed to render ineffective any
action taken by Holders of the requisite principal amount of Outstanding
Securities on the date such action is taken. 
Promptly after any record date is set pursuant to this paragraph, the
Company, at its own expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be given to
the Trustee in writing and to each Holder of Securities in the manner set forth
in Section 106.

 

The Trustee may set any
day as a record date for the purpose of determining the Holders of Outstanding
Securities entitled to join in the giving or making of (i) any
Notice of Default, (ii) any declaration of acceleration, or any
recission or annulment of any such declaration, referred to in Section 502,
(iii) any request to institute proceedings 

 

12

 

referred to in Section 507(2) or
(iv) any direction referred to in Section 512.  If any record date is set pursuant to this
paragraph, the Holders of Outstanding Securities on such record date, and no
other Holders, shall be entitled to join in such notice, declaration, request
or direction, whether or not such Holders remain Holders after such record
date; provided that no such action shall be effective hereunder unless
taken on or prior to the applicable Expiration Date by Holders of the requisite
principal amount of Outstanding Securities on such record date.  Nothing in this paragraph shall be construed
to prevent the Trustee from setting a new record date for any action for which
a record date has previously been set pursuant to this paragraph (whereupon the
record date previously set shall automatically and with no action by any Person
be cancelled and of no effect), and nothing in this paragraph shall be
construed to render ineffective any action taken by Holders of the requisite
principal amount of Outstanding Securities on the date such action is taken.  Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company’s expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Securities in the manner set forth in Section 106.

 

With respect to any
record date set pursuant to this Section, the party hereto which sets such
record dates may designate any day as the “Expiration Date” and from time to
time may change the Expiration Date to any earlier or later day; provided
that no such change shall be effective unless notice of the proposed new
Expiration Date is given to the other party hereto in writing, and to each
Holder of Securities in the manner set forth in Section 106, on or prior
to the existing Expiration Date.  If an
Expiration Date is not designated with respect to any record date set pursuant
to this Section, the party hereto which set such record date shall be deemed to
have initially designated the 180th day after such record date as the
Expiration Date with respect thereto, subject to its right to change the
Expiration Date as provided in this paragraph. 
Notwithstanding the foregoing, no Expiration Date shall be later than
the 180th day after the applicable record date. 
Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Security may do so with regard
to all or any part of the principal amount of such Security or by one or more
duly appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.

 

Section 105.                                Notices,
Etc., to Trustee, Company and Subsidiary Guarantor.  Any request, demand, authorization,
direction, notice, consent, waiver or Act of Holders or other document provided
or permitted by this Indenture to be made upon, given or furnished to, or filed
with:

 

(1)                                  the
Trustee by any Holder or by the Company or by the Subsidiary Guarantor shall be
sufficient for every purpose hereunder if made, given, furnished or filed to or
with the Trustee in writing at its Corporate Trust Office;

 

13

 

(2)           the Company by the Trustee or by any
Holder shall be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first class, postage prepaid, to
the Company addressed to it at the address of its principal office specified in
the first paragraph of this instrument or at any other address previously
furnished in writing to the Trustee by the Company, Attention: [General
Counsel]; or

 

(3)           the Subsidiary Guarantor by the
Trustee or by any Holder shall be sufficient for every purpose hereunder
(unless otherwise herein expressly provided) if in writing and mailed, first
class, postage prepaid, to the Subsidiary Guarantor addressed to it at the
address of its principal office specified in the first paragraph of this
instrument or at any other address previously furnished in writing to the
Trustee by the Subsidiary Guarantor, Attention: 
[General Counsel].

 

None of the Company, the
Subsidiary Guarantor and the Trustee shall be deemed to have received any such
request, demand, authorization, direction, notice, consent, waiver or Act of
Holders unless given, furnished or filed as provided in this Section 105.

 

Section 106.           Notice to Holders; Waiver.  Where this Indenture provides for notice to
Holders of any event, such notice shall be sufficiently given (unless otherwise
herein expressly provided) if in writing and mailed, first class postage
prepaid, to each Holder affected by such event, at the address of such Holder
as it appears in the Security Register, not later than the latest date (if
any), and not earlier than the earliest date (if any), prescribed for the
giving of such notice.  In any case where
notice to Holders is given by mail, neither the failure to mail such notice,
nor any defect in any notice so mailed, to any particular Holder shall affect
the sufficiency of such notice with respect to other Holders.  Where this Indenture provides for notice in
any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice.  Waivers
of notice by Holders shall be filed with the Trustee, but such filing shall not
be a condition precedent to the validity of any action taken in reliance upon
such waiver.

 

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

 

Section 107.           Conflict with Trust Indenture Act.  If any provision hereof limits, qualifies or
conflicts with a provision of the Trust Indenture Act which is required under
such Act to be a part of and govern this Indenture, the latter provision shall
control.  If any provision of this
Indenture modifies or excludes any provision of the Trust Indenture Act which
may be so modified or excluded, the latter provision shall be deemed to apply
to this Indenture as so modified or to be excluded, as the case may be.

 

14

 

Section 108.           Effect of Headings and Table of
Contents.  The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.

 

Section 109.           Successors and Assigns.  All covenants and agreements in this
Indenture by the Company or the Subsidiary Guarantor shall bind their
respective successors and assigns, whether so expressed or not.

 

Section 110.           Separability Clause.  In case any provision in this Indenture or in
the Securities shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.

 

Section 111.           Benefits of Indenture.  Nothing in this Indenture or in the
Securities, express or implied, shall give to any Person, other than the
parties hereto, any Paying Agent and their successors and assigns, and the
Holders, any benefit or any legal or equitable right, remedy or claim under
this Indenture.

 

Section 112.           Governing Law; Waiver of Jury
Trial.  This Indenture and the
Securities shall be governed by and construed in accordance with the laws of
the State of New York, without regard to conflicts of laws principles thereof.

 

EACH OF THE COMPANY AND
THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THE INDENTURE, THE SECURITIES OR THE TRANSACTION
CONTEMPLATED HEREBY.

 

Section 113.           Legal Holidays.  In any case where any Interest Payment Date,
Redemption Date, Maturity or Stated Maturity of any Security shall not be a
Business Day, then (notwithstanding any other provision of this Indenture or of
the Securities (other than a provision of any Security which specifically
states that such provision shall apply in lieu of this Section)) payment of
interest or principal (and premium, if any) need not be made on such date, but
may be made on the next succeeding Business Day with the same force and effect
as if made on the Interest Payment Date or Redemption Date, or at the Maturity
or Stated Maturity, and no interest shall accrue for the period from and after
such Interest Payment Date, Redemption Date, Maturity or Stated Maturity, as
the case may be, if such payment is made or duly provided for on the next
succeeding Business Day, except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day.

 

Section 114.           Computations.  Unless otherwise specifically provided, the
certificate or opinion of any independent firm of public accountants of
recognized standing selected by the Board of Directors shall be conclusive
evidence of the 

 

15

 

correctness of any
computation made under the provisions of this Indenture.  The Company shall furnish to the Trustee upon
its request a copy of any such certificate or opinion.

 

Section 115.           Force Majeure.  In no event shall the Trustee be responsible
or liable for any failure or delay in the performance of its obligations
hereunder arising out of or caused by, directly or indirectly, forces beyond
its control, including, without limitation, strikes, work stoppages, accidents,
acts of war or terrorism, civil or military disturbances, nuclear or natural
catastrophes or acts of God, and interruptions, loss or malfunctions of
utilities, communications or computer (software and hardware) services; it
being understood that the Trustee shall use reasonable efforts which are
consistent with accepted practices in the banking industry to resume
performance as soon as practicable under the circumstances.

 

ARTICLE TWO

 

Security
Forms

 

Section 201.           Forms Generally.  The Securities of each series shall be
substantially in the form attached as Exhibit A, or in such other form or
forms as shall be established by or pursuant to a Board Resolution or in one or
more indentures supplemental hereto, in each case with such appropriate
provisions as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with applicable tax
laws or the rules of any securities exchange or Depositary therefor or as
may, consistently herewith, be determined by the officers executing such
Securities, as evidenced by their execution thereof.  If the form of Securities of any series is
established by action taken pursuant to a Board Resolution, a copy of an
appropriate record of such action shall be certified by the Secretary or an
Assistant Secretary of the Company and delivered to the Trustee at or prior to
the delivery of the Company Order contemplated by Section 303 with respect
to the authentication and delivery of such Securities.

 

The Trustee’s certificate
of authentication shall be substantially in the form set forth in this Article.

 

The definitive Securities
shall be printed, typewritten or produced in any other manner permitted by the rules of
any securities exchange on which the Securities may be listed, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.

 

The Securities of each
series will initially be issued in the form of one or more Global
Securities.  Each such Global Security
shall represent such of the Outstanding Securities of such series as shall be
specified therein and each shall provide that it shall 

 

16

 

represent the aggregate
amount of Outstanding Securities of such series from time to time endorsed
thereon and that the aggregate amounts of Outstanding Securities of such series
represented thereby may from time to time be reduced or increased, as
appropriate.  The Global Security or
Securities evidencing the Securities of a series (and all Securities issued in
exchange therefore) shall bear the legend indicated in Section 202.

 

Section 202.           Form of Legend for Global
Securities.  Every Global Security
authenticated and delivered hereunder shall, in addition to the provisions
contained in Exhibit A, bear a legend in substantially the following form:

 

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

 

THIS SECURITY IS A
GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF DTC OR A NOMINEE THEREOF.  THIS SECURITY MAY NOT BE EXCHANGED IN
WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS
SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN DTC OR SUCH NOMINEE, EXCEPT IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE INDENTURE.

 

Section 203.           Form of Trustee’s Certificate
of Authentication.  The Trustee’s
certificates of authentication shall be in substantially the following form:

 

17

 

Certificate of
Authentication

 

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

 

	
   

  	
  The Bank of New York Trust Company, 

  N.A., as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
					

 

ARTICLE THREE

 

The
Securities

 

Section 301.           Title; Terms.  The aggregate principal amount of Securities
which may be authenticated and delivered under this Indenture is unlimited.

 

The Securities may be
issued in one or more series.  There
shall be established in or pursuant to a Board Resolution, and set forth in an
Officers’ Certificate, or established in one or more indentures supplemental
hereto, prior to the issuance of Securities of a series:

 

(a)           the title of the securities of such
series, which shall distinguish the Securities of the series from all other
Securities;

 

(b)           the limit, if any, upon the aggregate
principal amount of the Securities of such series which may be authenticated
and delivered under this Indenture (except for Securities authenticated and
delivered upon registration or transfer of, or in exchange for, or in lieu of,
other Securities of the same series pursuant to Section 304, 305, 306, 906
or Section 1108 and except for any Securities which, pursuant to Section 303,
are deemed never to have been authenticated and delivered hereunder); provided,
however, that the authorized aggregate principal amount of such series
may be increased above such amount by a Board Resolution to such effect;

 

(c)           the Stated Maturity or Maturities on
which the principal of the Securities of such series is payable or the method
of determination thereof;

 

18

 

(d)           the rate or rates, if any, at which
the Securities of such series shall bear interest or the method of determining
such rate or rates, the Interest Payment Dates on which such interest shall be
payable, the right, if any, of the Company to defer or extend an Interest
Payment Date, the Regular Record Date (if other than as defined in this
Indenture) for the interest payable on any Interest Payment Date and the dates
from which interest shall accrue and the method of determining these dates;

 

(e)           the place or places where the
principal of (and premium, if any) and interest on the Securities of such
series shall be payable, the place or places where the Securities of such
series may be presented for registration of transfer or exchange, and the place
or places where notices and demands to or upon the Company in respect of the
Securities of such series may be made;

 

(f)            the period or periods within or the
date or dates on which, if any, the price or prices at which and the terms and
conditions upon which the Securities of such series may be redeemed or prepaid,
in whole or in part, at the option of the Company;

 

(g)           the obligation or the right, if any,
of the Company or the Subsidiary Guarantor, as applicable, to redeem, repay or
purchase the Securities of such series pursuant to any sinking fund,
amortization or analogous provisions or at the option of a Holder thereof and
the period or periods within which, the price or prices at which, the currency
or currencies (including currency unit or units) in which and the other terms
and conditions upon which Securities of the series shall be redeemed, repaid or
purchased, in whole or in part, pursuant to such obligation;

 

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

 

(i)            if other than Dollars, the currency
or currencies (including currency unit or units) in which the principal of (and
premium, if any) and interest, if any, on the Securities of the series shall be
payable, or in which the Securities of the series shall be denominated;

 

(j)            the additions, modifications or
deletions, if any, in the Events of Default or covenants of the Company or the
Subsidiary Guarantor set forth herein with respect to the Securities of such
series;

 

(k)           if other than the principal amount
thereof, the portion of the principal amount of Securities of such series that
shall be payable upon declaration of acceleration of the Maturity thereof;

 

19

 

(l)            the additions or changes, if any, to
this Indenture with respect to the Securities of such series as shall be
necessary to permit or facilitate the issuance of the Securities of such series
in bearer form, registrable or not registrable as to principal, and with or
without interest coupons;

 

(m)          any index or indices used to determine
the amount of payments of principal of and premium, if any, on the Securities
of such series or the manner in which such amounts will be determined;

 

(n)           the issuance of a temporary Global
Security representing all of the Securities of such series and the terms upon
which such temporary Global Security may be exchanged for definitive Securities
of such series;

 

(o)           whether the Securities of the series
shall be issued in whole or in part in the form of one or more Global
Securities and, in such case, the identity of the Depositary for such Global
Securities;

 

(p)           the appointment of any Paying Agent
or Agents for the Securities of such series;

 

(q)           the terms and conditions of any right
or obligation on the part of the Company, or any option on the part of the
Holders, to convert or exchange Securities of such series into cash or any
other securities or property of the Company or any other Person, and the
additions or changes, if any, to this Indenture with respect to the Securities
of such series to permit or facilitate such conversion or exchange;

 

(r)            the relative degree, if any, to
which the Securities of the series shall be senior to or be subordinated to
other series of Securities in right of payment, whether such other series of
Securities are Outstanding or not;

 

(s)           whether and under what circumstances
any or all of the provisions of this Indenture relating to the subordination of
the Securities (including the provisions of Article Twelve), or different
subordination provisions, including a different definition of “Senior
Indebtedness” will apply or cease to apply to Securities of the series;

 

(t)            provided the Securities of such
series are non-convertible, whether the Subsidiary Guarantor will guarantee, on
an unsecured subordinated basis, the obligations of the Company under the
Securities of such series and if so, the specific terms and form of such
Subsidiary Guarantee or Subsidiary Guarantees, any related modifications,
amendments, supplements or deletions of any of the terms of this Indenture, and
a statement that the Subsidiary Guarantor shall be an “obligor” as such term is
defined in and solely for purposes of the Trust Indenture 

 

20

 

Act and shall be required to comply with those
provisions of this Indenture compliance with which is required by an “obligor”
under the Trust Indenture Act; and

 

(u)           any other terms of the Securities of
such series or any related Subsidiary Guarantee (which terms shall not be
inconsistent with the provisions of the Trust Indenture Act, but may modify,
amend, supplement or delete any of the terms of this Indenture with respect to
such series), including any terms which may be required by or advisable under
United States laws or regulations or advisable (as determined by the Company)
in connection with the marketing of Securities of the series;

 

provided,
that if the Subsidiary Guarantor will guarantee the obligations of the Company
under the Securities of a series, such matters shall be established in one or
more indenture supplements hereto to which the Company, the Subsidiary
Guarantor and the Trustee shall be a party.

 

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

 

If any of the terms of
the series are established by action taken pursuant to a Board Resolution, a
copy of an appropriate record of such action shall be certified by the
Secretary or an Assistant Secretary of the Company and delivered to the Trustee
at or prior to the delivery of the Officers’ Certificate setting forth the
terms of the series.

 

Section 302.           Denominations.  The Securities of each series shall be in
registered form without coupons and shall be issuable in denominations of
$1,000 and any integral multiples thereof, unless otherwise specified as
contemplated by Section 301.

 

Section 303.           Execution, Authentication,
Delivery and Dating.  The Securities
shall be executed on behalf of the Company by its Chairman, President, Chief
Executive Officer or any Vice President. 
The signature of any of these officers on the Securities may be manual
or facsimile.

 

Securities bearing the
manual or facsimile signature of an individual who was at any time a proper
officer of the Company shall bind the Company, notwithstanding that such
individual has ceased to hold such office prior to the authentication and
delivery of such Securities or did not hold such office at the date of such
Securities.

 

At any time and from time
to time after the execution and delivery of this Indenture, the Company may
deliver Securities executed by the Company to the Trustee for authentication,
together with a Company Order for the authentication and delivery of 

 

21

 

such Securities, and the
Trustee in accordance with the Company Order shall authenticate and deliver
such Securities.

 

Notwithstanding the
provisions of the preceding paragraph, if all Securities of a series are not to
be originally issued at one time, it shall not be necessary to deliver the
Company Order otherwise required pursuant to such preceding paragraph at or
prior to the authentication of each Security of such series if such Company
Order is delivered at or prior to the authentication upon original issuance of
the first Security of such series to be issued.

 

Each Security shall be
dated the date of its authentication.

 

No Security shall be
entitled to any benefit under this Indenture or be valid or obligatory for any
purpose, unless there appears on such Security a certificate of authentication
substantially in the form provided for herein executed by the Trustee by the
manual signature of one of its authorized signatories, and such certificate
upon any Security shall be conclusive evidence, and the only evidence, that
such Security has been duly authenticated and delivered hereunder.  Notwithstanding the foregoing, if any
Security shall have been authenticated and delivered hereunder but never issued
and sold by the Company, and the Company shall deliver such Security to the
Trustee for cancellation as provided in Section 309, for all purposes of
this Indenture such Security shall be deemed never to have been authenticated
and delivered hereunder and shall never be entitled to the benefits of this
Indenture.

 

Minor typographical and
other minor errors in the text of any Security shall not affect the validity
and enforceability of such Security if it has been duly authenticated and
delivered by the Trustee.

 

The Company shall execute
and the Trustee shall authenticate and deliver one or more Global Securities
with respect to each series of Securities that (i) shall represent
an aggregate amount equal to the aggregate principal amount of the initially
issued Securities of such series, (ii) shall be registered in the
name of the Depositary or the nominee of the Depositary, (iii) shall
be delivered by the Trustee to the Depositary or pursuant to the Depositary’s
instruction and (iv) shall bear a legend substantially in the form
required in Section 202.

 

The Trustee shall have
the right to decline to authenticate and deliver any Securities under this Section if
the Trustee, being advised by counsel, determines in good faith that such
action may not lawfully be taken or if the Trustee in good faith shall
determine that such action would expose the Trustee to personal liability to existing
Holders.

 

The Depositary must, at
all times while it serves as such Depositary, be a clearing agency registered
under the Exchange Act, and any other applicable statute or regulation.  

 

22

 

Neither the Trustee nor
any agent shall have any responsibility for any actions taken or not taken by
the Depositary.

 

Section 304.           Temporary Securities.  Pending the preparation of definitive
Securities of any series, the Company may execute, and upon Company Order the
Trustee shall authenticate and deliver, temporary Securities which are printed,
typewritten or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities of any series in lieu
of which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities
may determine, as evidenced by their execution of such Securities.

 

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

 

Section 305.           Registration; Registration of
Transfer and Exchange.  The Company
shall cause to be kept at the Corporate Trust Office a register (the register
maintained in such office or in any other office or agency of the Company in a
Place of Payment being herein sometimes referred to as the “Security
Register”) in which, subject to such reasonable regulations as it may
prescribe, the Company shall  provide for
the registration of Securities and of transfers and exchanges of
Securities.  The Trustee is hereby
appointed “Security Registrar” for the purpose of registering Securities and
transfers of Securities as herein provided.

 

Upon surrender for registration
of transfer of any Security at the office or agency of the Company in a Place
of Payment, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of the same series of any authorized denominations and of a like
tenor and aggregate principal amount, of the same original Issue Date and
Stated Maturity and having the same terms.

 

Notwithstanding any other
provision of this Section, unless and until it is exchanged in whole or in part
for the individual Securities represented thereby, a Global Security
representing all or a portion of the Securities may not be transferred except
as a whole by the Depositary to a nominee of such Depositary, or by a nominee
of such 

 

23

 

Depositary to such
Depositary or another nominee of such Depositary, or by such Depositary or any
such nominee to a successor Depositary or nominee of such successor Depositary.

 

At the option of the
Holder, Securities may be exchanged for other Securities, of the same series of
any authorized denominations, of like tenor and aggregate principal amount, of
the same Original Issue Date and Stated Maturity and having the same terms,
upon surrender of the Securities to be exchanged at such office or agency.  Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.

 

If at any time the
Depositary notifies the Company that it is unwilling or unable to continue as
Depositary or if at any time the Depositary shall cease to be a clearing agency
registered under the Exchange Act as provided in Section 303, the Company
shall appoint a successor Depositary.  If
a successor Depositary is not appointed by the Company within 90 days after the
Company receives such notice or becomes aware of such ineligibility, the Company
will execute, and the Trustee, upon receipt of a Company Order for the
authentication and delivery of individual Securities, will authenticate and
make available for delivery, individual Securities in an aggregate principal
amount equal to the principal amount of the Global Security or Securities
representing the Securities in exchange for such Global Security or Securities.

 

The Company may at any
time and in its sole discretion (subject to the procedures of the Depositary)
determine that individual Securities issued in the form of one or more Global
Securities shall no longer be represented by such Global Security or
Securities.  In such event the Company
will execute, and the Trustee, upon receipt of a Company Order for the
authentication and delivery of individual Securities, will authenticate and
make available for delivery, individual Securities in an aggregate principal
amount equal to the principal amount of the Global Security or Securities
representing the Securities in exchange for such Global Security or Securities.

 

The Depositary may
surrender a Global Security in exchange in whole or in part for individual
Securities on such terms as are acceptable to the Company, the Trustee and such
Depositary.  Thereupon, the Company shall
execute, and the Trustee shall authenticate and make available for delivery,
without service charge:

 

(1)           to each Person specified by such
Depositary a new individual Security or Securities of any authorized
denomination as requested by such Person in aggregate principal amount equal to
and in exchange for such Person’s beneficial interest in the Global Security;
and

 

(2)           to such Depositary a new Global
Security in a denomination equal to the difference, if any, between the
principal amount of the surrendered Global 

 

24

 

Security and the
aggregate principal amount of individual Securities delivered to Holders
thereof.

 

Upon the exchange of a
Global Security for individual Securities in an aggregate principal amount
equal to the principal amount of such Global Security, such Global Security
shall be canceled by the Trustee. 
Individual Securities issued in exchange for a Global Security pursuant
to this Section shall be registered in such names and in such authorized
denominations as the Depositary for such Global Security, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee.  The Trustee shall
make available for delivery such individual Securities to the Persons in whose
names such Securities are so registered.

 

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

 

Every Security presented
or surrendered for registration of transfer or for exchange shall (if so
required by the Company or the Security Registrar) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed, by the Holder thereof or his
attorney duly authorized in writing.

 

No service charge shall
be made to a Holder for any registration of transfer or exchange of Securities,
but the Company may require payment 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 Securities, other than exchanges
pursuant to Section 304, 906 or 1108 not involving any transfer.

 

Neither the Company nor
the Trustee shall be required, pursuant to the provisions of this Section:  (i) to issue, register the
transfer of or exchange any Security of any series during a period beginning at
the opening of business 15 calendar days before the day of the mailing of a
notice of redemption of any such Securities selected for redemption of
Securities pursuant to Article Eleven and ending at the close of business
on the day of such mailing of notice of redemption; or (ii) to
register the transfer of or exchange any Security so selected for redemption in
whole or in part, except, in the case of any Security to be redeemed in part,
any portion thereof that is not redeemed.

 

Section 306.           Mutilated, Destroyed, Lost and Stolen
Securities.  If any mutilated
Security is surrendered to the Trustee together with such security or indemnity
as may be required by the Company or the Trustee to save each of them harmless,
the Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor a new Security of the same issue and series, of like tenor
and principal amount, having the same 

 

25

 

Original Issue Date and
Stated Maturity and bearing the same Interest Rate as such mutilated Security,
and bearing a number not contemporaneously outstanding.

 

If there shall be
delivered to the Company and to the Trustee (i) evidence to their
satisfaction of the destruction, loss or theft of any Security and (ii) such
security or indemnity as may be required by them to save each of them and any
agent of either of them harmless, then, in the absence of notice to the Company
or the Trustee that such Security has been acquired by a bona fide purchaser,
the issuing Company shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of the same issue and series of like tenor and
principal amount, having the same Original Issue Date and Stated Maturity and
bearing the same Interest Rate as such destroyed, lost or stolen Security, and
bearing a number not contemporaneously outstanding.

 

In case any such
mutilated, destroyed, lost or stolen Security has become or is about to become
due and payable, the Company in its discretion may, instead of issuing a new
Security, pay such Security.

 

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

 

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

 

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

 

Section 307.           Payment of Interest; Interest
Rights Preserved.  Interest on any
Security of any series which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest in respect of
Securities of such series.  The initial
payment of interest on any Security of any series which is issued between a
Regular Record Date and the related Interest Payment Date shall be payable as
provided in such Security or in the Board Resolution pursuant to Section 301
with respect to the related series of Securities.

 

26

 

Any interest on any
Security which is payable, but is not timely paid or duly provided for, on any
Interest Payment Date for Securities of such series (herein called “Defaulted
Interest”), shall forthwith cease to be payable to the registered Holder on
the relevant Regular Record Date by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in Clause (1) or (2) below:

 

(1)           The Company may elect to make payment
of any Defaulted Interest to the Persons in whose names the Securities of such
series in respect of which interest is in default (or their respective
Predecessor Securities) are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be fixed in
the following manner.  The Company shall
notify the Trustee in writing of the amount of Defaulted Interest proposed to
be paid on each Security and the date of the proposed payment, and at the same
time the Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit 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 15 days and not less than 10 days prior to the
date of the proposed payment and not less than 10 days after the receipt by the
Trustee of the notice of the proposed payment. 
The Trustee shall promptly notify the Company of such Special Record
Date and, in the name and at the expense of the Company, 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 of a
Security of such series at the address of such Holder as it appears in the
Security Register not less than 10 days prior to such Special Record 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
Securities of such series (or their respective Predecessor Securities) are
registered at the close of business on such Special Record Date and shall no
longer be payable pursuant to the following Clause (2).

 

(2)           The Company may make payment of any
Defaulted Interest on the Securities of any series in any other lawful manner
not inconsistent with the requirements of any securities exchange on which the
Securities of the series in respect of which interest is in default may be
listed, and upon such notice as may be required by such exchange (or by the
Trustee if the Securities are not listed), if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this Clause, such
manner of payment shall be deemed practicable by the Trustee.

 

27

 

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

 

Section 308.                               Persons Deemed Owners.  The Company, the Subsidiary Guarantor, the
Trustee and any agent of the Company, the Subsidiary Guarantor or the Trustee
may treat the Person in whose name any Security is registered as the owner of
such Security for the purpose of receiving payment of principal of and any
premium and (subject to Section 307) any interest on such Security or any
payment pursuant to any Subsidiary Guarantee of such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and none of the
Company, the Subsidiary Guarantor, the Trustee and any agent of the Company,
the Subsidiary Guarantor or the Trustee shall be affected by notice to the
contrary.

 

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

 

Section 309.                               Cancellation.  All Securities surrendered for payment,
redemption, registration of transfer or exchange shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee, and any such
Securities and Securities surrendered directly to the Trustee for any such
purpose shall be promptly cancelled by it. 
The Company may at any time deliver to the Trustee for cancellation any
Securities previously authenticated and delivered hereunder which the Company
may have acquired in any manner whatsoever, and may deliver to the Trustee (or
to any other Person for delivery to the Trustee) for cancellation any Securities
previously authenticated hereunder which the Company has not issued and sold,
and all Securities so delivered shall be promptly cancelled by the
Trustee.  No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture.  All cancelled Securities held by the Trustee
shall be disposed by the Trustee in accordance with its customary procedures or
as directed by a Company Order, and the Trustee shall deliver to the Company a
certificate evidencing the disposition of the cancelled Securities upon its
request therefor.  Acquisition by the
Company of any Security shall not operate as a redemption or satisfaction of
the indebtedness represented by such Security unless and until the same is
delivered to the Trustee for cancellation.

 

Section 310.                               Computation of
Interest.  Except as otherwise
specified as contemplated by Section 301 for Securities of any series,
interest on the Securities of each series shall be computed on the basis of a
360-day year consisting of twelve 30-day months.

 

28

 

Section 311.                               CUSIP Numbers.  The Company in issuing the Securities 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 Holders; provided
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Securities or as contained
in any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such redemption shall
not be affected by any defect in or omission of such numbers.  The Company will promptly notify the Trustee
in writing of any change in the “CUSIP” numbers.

 

ARTICLE FOUR

 

Satisfaction and Discharge

 

Section 401.                               Satisfaction and
Discharge of Indenture.  This
Indenture shall upon Company Request cease to be of further effect with respect
to Securities of a series (except as to any surviving rights of registration of
transfer or exchange of Securities herein expressly provided for) and the
Trustee at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture with respect to such
Securities, when:

 

(1)                                 either

 

(A)                              all
such Securities theretofore authenticated and delivered (other than (i) Securities
which have been destroyed, lost or stolen and which have been replaced or paid
as provided in Section 306 and (ii) Securities for whose
payment money has theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or discharged from
such trust, as provided in Section 1003) have been delivered to the
Trustee for cancellation; or

 

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

 

(i)                                     have
become due and payable, or

 

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

 

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

 

29

 

and the Company,
in the case of (i), (ii) or (iii) above, has deposited or caused to
be deposited with the Trustee as trust funds: 
(A) money; (B) Government Obligations which
through the scheduled payment of principal and interest in respect thereof in
accordance with their terms will provide, not later than one day before the due
date of any payment, money; or (C) a combination thereof, in each
case in an amount sufficient to pay and discharge, and which shall be applied
by the Trustee, to pay and discharge the entire indebtedness on such Securities
not theretofore delivered to the Trustee for cancellation, for principal (and
premium, if any) and interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated Maturity or
Redemption Date, as the case may be; provided, that the Trustee shall
have the right (but not the obligation) to require the Company to deliver to
the Trustee an opinion of a nationally recognized firm of independent public
accountants expressed in a written certification, or other evidence
satisfactory to the Trustee, as to the sufficiency of deposits made by the
Company pursuant to this Section;

 

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

 

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

 

The Company shall
pay and indemnify the Trustee against any tax, fee or other charge imposed on
or assessed against the Government Obligations deposited pursuant to Section 401
or the principal and interest received in respect thereof other than any such
tax, fee or other charge which by law is for the account of the Holders of
Outstanding Securities.

 

Notwithstanding
the satisfaction and discharge of this Indenture, the obligations of the
Company to the Trustee under Section 607 and the preceding paragraph, the
obligations of the Company to any Authenticating Agent under Section 614
and, if money and/or Government Obligations shall have been deposited with the
Trustee  pursuant to subclause (B) of
Clause (1) of this Section, the obligations of the Trustee under Section 402
and the last paragraph of Section 1003 shall survive such satisfaction and
discharge.

 

Section 402.                               Application of Trust
Money.  Subject to the provisions of
the last paragraph of Section 1003, all money and Government Obligations
deposited with the Trustee pursuant to Section 401 and all proceeds of
such Government Obligations and the interest thereon, shall be held in trust
and applied by it, in accordance with the provisions of the Securities of the
applicable series and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as its own Paying Agent)
as 

 

30

 

the Trustee may
determine, to the Persons entitled thereto, of the principal and any premium
and interest for whose payment such money and Government Obligations have been
deposited with the Trustee.

 

ARTICLE FIVE

 

Remedies

 

Section 501.                               Events of Default.  “Event of Default”, wherever used
herein with respect to the Securities of any series, means any one of the
following events (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):

 

(1)                                 default
in the payment of any interest upon any Security of that series when it becomes
due and payable, and such default continues for a period of 30 days; or

 

(2)                                 default
in the payment of the principal of or premium, if any, on any Security of that
series at its Maturity; or

 

(3)                                 default
in the performance, or breach, of any covenant or warranty of the Company in
this Indenture (other than a covenant or warranty a default in the performance
of which or the breach of which is specifically dealt with elsewhere in this
Section), and continuance of such default or breach for a period of 90 days
after there has been given, by registered or certified mail, to the Company by
the Trustee or to the Company and the Trustee by the Holders of at least 25% in
aggregate principal amount of the Outstanding Securities of that series a
written notice specifying such default or breach and requiring it to be remedied
and stating that such notice is a “Notice of Default” hereunder; or

 

(4)                                 the
entry of a decree or order by a court having jurisdiction in the premises
adjudging the Company bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization, arrangement, adjustment or composition of or
in respect of the Company under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law, or appointing a receiver,
liquidator, assignee, trustee, sequestrator (or other similar official) of the
Company or of any substantial part of its property or ordering the winding up
or liquidation of its affairs, and the continuance of any such decree or order
unstayed and in effect for a period of 90 consecutive days; or

 

(5)                                 the
institution by the Company of proceedings to be adjudicated bankrupt or
insolvent, or the consent by it to the institution of bankruptcy or insolvency
proceedings against it, or the filing by it of a petition or answer of 

 

31

 

consent seeking
reorganization or relief under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law, or the consent by it to the
filing of any such petition or to the appointment of a receiver, liquidator
assignee, trustee, sequestrator (or other similar official) of the Company or
of any substantial part of its property, or the making by it of an assignment
for the benefit of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due and its willingness to
be adjudicated bankrupt, or the taking of corporate action by the Company in
furtherance of any such action; or

 

(6)                                 any
other Event of Default specified with respect to Securities of that series as contemplated
in Section 301.

 

Section 502.                               Acceleration of
Maturity; Rescission and Annulment. 
If an Event of Default (other than an Event of Default specified in Section 501(4) or
Section 501(5)) with respect to Securities of any series at the time Outstanding
occurs and is continuing, then in every such case the Trustee or the Holders of
not less than 25% in aggregate principal amount of the Outstanding Securities
of that series may declare the principal amount (or, if the Securities of that
series are Original Issue Discount Securities, such portion of the principal
amount as may be specified in the terms of that series) of all of the
Securities of that series to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by Holders), and upon any
such declaration such principal amount (or specified amount) shall become
immediately due and payable, provided that the payment of principal and
interest on such Securities shall remain subordinated to the extent provided in
Article Twelve.  If an Event of
Default specified in Section 501(4) or Section 501(5) with
respect to Securities of a series at the time Outstanding occurs, the principal
amount of all the Securities of such series (or specified amount) shall
automatically, and without any declaration or other action on the part of the
Trustee or any Holder, become immediately due and payable.

 

At any time after
such a declaration of acceleration with respect to Securities of any series has
been made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article provided, the
Holders of not less than a majority in aggregate principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if:

 

(1)                                 the
Company has paid or deposited with the Trustee a sum sufficient to pay

 

(A)                             all
overdue interest on all Securities of that series,

 

(B)                               the
principal of, and premium, if any, on, any Securities of that series which have
become due otherwise than by such declaration of 

 

32

 

acceleration and
any interest thereon at the rate or rates borne by such Securities,

 

(C)                               to
the extent that payment of such interest is lawful, interest upon overdue
installments of interest at the rate or rates borne by or prescribed therefor
in such Securities, and

 

(D)                              all
sums paid or advanced by the Trustee hereunder and the reasonable compensation,
disbursements, advances and expenses of the Trustee, its agents and counsel;
and

 

(2)                                 all
Events of Default with respect to Securities of that series, other than the
non-payment of the principal (or a specified portion of the principal) of and interest
on Securities of that series which has become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 513.

 

No such rescission
shall affect any subsequent default or impair any right consequent thereon.

 

Section 503.                               Collection of
Indebtedness and Suits for Enforcement by Trustee.  The Company covenants that if:

 

(1)                                 default
is made in the payment of any interest on any Security when such interest
becomes due and payable and such default continues for a period of 30 days, or

 

(2)                                 default
is made in the payment of the principal or premium, if any, on any Security at
the Maturity thereof,

 

the Company will, upon demand of the Trustee, pay to
it, for the benefit of the Holders of such Securities, the whole amount then
due and payable on such Securities for principal, including any sinking fund
payment or analogous obligations (and premium, if any) and interest, including,
to the extent that payment of such interest shall be legally enforceable,
interest on any overdue principal or premium, if any, and on any overdue
interest, at the rate or rates prescribed therefor in such Securities, and, in
addition thereto, such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation,
disbursements, advances and expenses of the Trustee, its agents and counsel.

 

If the Company
fails to pay such amounts forthwith upon such demand, the Trustee, in its own
name and as trustee of an express trust, may institute a judicial proceeding
for the collection of the sums so due and unpaid, may prosecute such proceeding
to judgment or final decree and may enforce the same against the Company or any
other obligor upon the Securities and collect the moneys adjudged or decreed to
be 

 

33

 

payable in the
manner provided by law out of the property of the Company or any other obligor
upon the Securities, wherever situated.

 

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

 

Section 504.                               Trustee May File
Proofs of Claim.  In case of any
judicial proceeding relative to the Company (or any other obligor upon the
Securities), its property or its creditors:

 

(a)                                 the
Trustee shall be entitled and empowered, by intervention in such proceeding or
otherwise,

 

(i)                                    to
take any and all actions authorized under the Trust Indenture Act in order to
have claims of the Holders and the Trustee allowed in any such proceeding, and

 

(ii)                                 in
particular, the Trustee shall be authorized to collect and receive any moneys
or other property payable or deliverable on any such claims and to distribute
the same in accordance with Section 506; and

 

(b)                                any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee for distribution in accordance with
Section 506, and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, disbursements, advances and
expenses of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 607.

 

No provision of
this Indenture shall be deemed to authorize the Trustee to authorize or consent
to or accept or adopt on behalf of any Holder any plan of reorganization,
arrangement, adjustment or composition affecting the Securities or the rights
of any Holder thereof or to authorize the Trustee to vote in respect of the
claim of any Holder in any such proceeding; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors’ or
other similar committee.

 

Section 505.                               Trustee May Enforce
Claims Without Possession of Securities. 
All rights of action and claims under this Indenture or the Securities
may be prosecuted and 

 

34

 

enforced by the
Trustee without the possession of any of the Securities or the production thereof
in any proceeding relating thereto, and any such 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, disbursements, advances and expenses of the Trustee,
its agents and counsel, be for the ratable benefit of the Holders of the
Securities in respect of which such judgment has been recovered.

 

Section 506.                               Application of Money
Collected.  Any money or property
collected or to be applied by the Trustee with respect to a series of
Securities pursuant to this Article shall be applied in the following
order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money or property on account of principal or premium, if
any, or interest, upon presentation of the Securities and the notation thereon
of the payment if only partially paid and upon surrender thereof if fully paid:

 

FIRST:  To the payment of all amounts due the Trustee
and any predecessor Trustee under Section 607;

 

SECOND:  To the payment of the amounts then due and
unpaid upon such series of Securities for principal (and premium, if any) and
interest in respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind, according to
the amounts due and payable on such series of Securities for principal (and
premium, if any) and interest, respectively; and

 

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

 

Section 507.                               Limitation on Suits.  No Holder of any Securities of any series
shall have any right to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless:

 

(1)                                 such
Holder has previously given written notice to the Trustee of a continuing Event
of Default with respect to the Securities of that series;

 

(2)                                 the
Holders of not less than 25% in aggregate principal amount of the Outstanding
Securities of that series have made written request to the Trustee to institute
proceedings in respect of such Event of Default in its own name as Trustee
hereunder;

 

35

 

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

 

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

 

(5)                                 no
direction inconsistent with such written request has been given to the Trustee
during such 60-day period by the Holders of a majority in aggregate principal
amount of the Outstanding Securities of that series;

 

it being understood and
intended that no one or more of such Holders shall have any right in any manner
whatever by virtue of, or by availing of, any provision of this Indenture to
affect, disturb or prejudice the rights of any other of such Holders (it being
understood that the Trustee does not have an affirmative duty to ascertain
whether or not such actions or forbearances are unduly prejudicial to such
Holders), or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.

 

Section 508.                               Unconditional
Right of Holders to Receive Principal, Premium and Interest.  Notwithstanding any other provision in this
Indenture, the Holder of any Security shall have the right, which is absolute
and unconditional, to receive payment of the principal of (and premium, if any)
and (subject to Section 307) interest on such Security on the respective
Stated Maturities expressed in such Security (or, in the case of redemption, on
the Redemption Date) and to institute suit for the enforcement of any such
payment, and such rights shall not be impaired without the consent of such
Holder.

 

Section 509.                               Restoration
of Rights and Remedies.  If the
Trustee or any Holder has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company, the Subsidiary Guarantor, the Trustee and the Holders
shall be restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of the Trustee and the Holders
shall continue as though no such proceeding had been instituted.

 

Section 510.                               Rights
and Remedies Cumulative.  Except as
otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities in the last paragraph of Section 306,
no right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. 
The assertion or employment of any 

 

36

 

right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

 

Section 511.                               Delay
or Omission Not Waiver.  No delay or
omission of the Trustee or of any Holder of any Securities to exercise any
right or remedy accruing upon any Event of Default shall impair any such right
or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein.  Every right and
remedy given by this Article or by law to the Trustee or to the Holders
may be exercised from time to time, and as often as may be deemed expedient, by
the Trustee or by the Holders, as the case may be.

 

Section 512.                               Control
by Holders.  The Holders of a
majority in aggregate principal amount of the Outstanding Securities of any
series shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred on the Trustee, with respect to the Securities of such
series, provided that:

 

(1)                                 such
direction shall not be in conflict with any rule of law or with this
Indenture, involve the Trustee in personal liability or be unduly prejudicial
to the Holders of the Securities not joining in the action; and

 

(2)                                 the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.

 

Section 513.                               Waiver
of Past Defaults.  The Holders of not
less than a majority in aggregate principal amount of the Outstanding
Securities of any series may, on behalf of the Holders of all the Securities of
such series, waive any past default hereunder with respect to such series and
its consequences, except a default:

 

(1)                                 in
the payment of the principal of, or premium, if any, or interest on, any
Security of such series; or

 

(2)                                 in
respect of a covenant or provision hereof which under Article Nine cannot
be modified or amended without the consent of the Holder of each Outstanding
Security of such series affected.

 

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

 

Section 514.                               Undertaking
for Costs.  All parties to this
Indenture agree, and each holder of any Security by his acceptance thereof
shall be deemed to have agreed, that any court may in its discretion require, in
any suit for the enforcement of any right or 

 

37

 

remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, any party litigant in such suit to file an
undertaking to pay the costs of such suit, and that court may in its discretion
assess reasonable costs, including reasonable attorneys’ fees and expenses,
against any such party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant, in the
manner and to the extent provided in the Trust Indenture Act; provided,
that neither this Section nor the Trust Indenture Act shall be deemed to
authorize any court to require such an undertaking or to make such an
assessment in any suit instituted by the Company or by the Trustee, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% in principal amount of the Outstanding Securities of any series, or
any suit instituted by any Holder for the enforcement of the payment of the
principal of (or premium, if any) or interest on any Security on or after the
respective Stated Maturities expressed in such Security (or in the case of
redemption, on the Redemption Date).

 

Section 515.                               Waiver
of Usury, Stay or Extension Laws. 
Each of the Company and the Subsidiary Guarantor covenants (to the
extent that it may lawfully do so), that it will not at any time insist upon,
or plead, or in any manner whatsoever claim or take the benefit or advantage
of, any usury, stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and each of the Company and the Subsidiary Guarantor (to the extent
that it may lawfully do so), hereby expressly waives all benefit or advantage
of any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had been
enacted.

 

ARTICLE SIX

 

The Trustee

 

Section 601.                               Certain
Duties and Responsibilities.

 

(a)                                 Except
during the continuance of an Event of Default,

 

(i)                                    the
Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and

 

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

 

38

 

to determine
whether or not they conform to the requirements of this Indenture (but need not
confirm or investigate the accuracy of mathematical calculations or other facts
stated therein).

 

(b)                                In
case an Event of Default has occurred and is continuing, 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 his or her own
affairs.

 

(c)                                 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

 

(i)                                    this
Subsection shall not be construed to limit the effect of Subsection (a) of
this Section;

 

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

 

(iii)                              the
Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction of the Holders of a
majority in principal amount of the Outstanding Securities of any series,
determined as provided in Sections 101, 104 and 512, 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 with respect to the Securities of such series; and

 

(iv)                             no
provision of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.

 

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

 

Section 602.                               Notice
of Defaults.  If a default occurs
hereunder with respect to the Securities of a series, the Trustee within 90
days of such default shall give the Holders of such Securities notice of such
default as and to the extent provided by the Trust Indenture Act; provided,
however, that in the case of any default of the character specified in Section 501(3) with
respect to such Securities, no such notice to Holders shall be given until at
least 30 days after the occurrence thereof; and provided, further,

 

39

 

that the Trustee
may withhold notice to the Holders, of any default with respect to Securities
of a series (except any default of the character specified in Section 501(1) and
(2)), if and so long as the board of directors, the executive committee or a
trust committee of directors or Responsible Officers of the Trustee in good
faith determine that the withholding of the notice is in the interest of the
Holders of such Securities.  For the
purpose of this Section, the term “default” means any event which is, or after
notice or lapse of time or both would become, an Event of Default with respect
to the Securities of a series.

 

Section 603.                               Certain
Rights of Trustee.  Subject to the
provisions of Section 601:

 

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

 

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

 

(3)                                 whenever
in the administration of this Indenture the Trustee shall deem it desirable
that a matter be proved or established prior to taking, suffering or omitting
any action hereunder, the Trustee (unless other evidence be herein specifically
prescribed) may, in the absence of bad faith on its part, rely upon an Officers’
Certificate and may at its discretion secure such further evidence deemed
necessary or advisable, but shall in no case be bound to secure the same;

 

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

 

(5)                                 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, debenture, note, other
evidence of indebtedness or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Company, personally or by agent or attorney;

 

40

 

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

 

(7)                                 the
Trustee’s immunities and protections from liability and its rights to
compensation and indemnification in connection with the performance of its
duties under this Indenture shall extend to the Trustee’s officers, directors,
agents and employees and its services as Paying Agent, Security Registrar or
any other role assumed by the Trustee hereunder or to which it has been
appointed with respect to the Securities issued hereunder.  Such immunities and protections and right to
indemnification, together with the Trustee’s right to compensation, shall
survive the Trustee’s resignation or removal and final payment of the Securities;

 

(8)                                 the
Trustee is not required to give any bond or surety with respect to the
performance of its duties or the exercise of its powers under this Indenture;

 

(9)                                 the
Trustee shall not be deemed to have actual knowledge of any “default” or Event
of Default hereunder except (i) during any period it is serving as
Paying Agent for the Securities of a series, any Event of Default pursuant to Section 501(1) or
(2), or (ii) any default or Event of Default of which a Responsible
Officer shall have received written notification from the Company or the
Holders of at least 25% in aggregate principal amount of the Securities of the
series with respect to which such default or Event of Default has occurred and
is continuing or obtained “actual knowledge.” 
The term “actual knowledge” as used herein shall mean the actual
fact or statement of knowing by a Responsible Officer without independent
investigation with respect thereto.  The
term “default” as used in this Section 603 shall mean any event
which is, or after notice or lapse of time or both would become, an Event of
Default with respect to Securities of a series;

 

(10)                           the
Trustee shall be under no obligation to exercise any of the rights or powers
vested in it by this Indenture (other than the payment of debt service on the
Securities from moneys furnished to it pursuant hereto), whether at the request
or direction of the Holders or any other Person, pursuant to this Indenture or
otherwise, unless it shall have been offered indemnity or security satisfactory
to it against the fees, advances, costs, expenses and liabilities which might
be incurred by it in connection with the exercise of any such rights or powers;

 

(11)                           in
no event shall the Trustee be responsible or liable for special, indirect, or
consequential loss or damage of any kind whatsoever (including, but 

 

41

 

not limited to,
loss of profit) irrespective of whether the Trustee has been advised of the
likelihood of such loss or damage and regardless of the form of action; and

 

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

 

Notwithstanding
anything else herein contained, (i) the Trustee shall not be liable
for any error of judgment made in good faith by any officer of the Trustee and (ii) no
provision of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder or in the exercise of any of its rights or powers if it
believes the repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.

 

Section 604.                               Not
Responsible for Recitals or Issuance of Securities.  The recitals contained herein and in the
Securities, except the Trustee’s certificates of authentication, shall be taken
as the statements of the Company, and neither the Trustee nor any
Authenticating Agent assumes any responsibility for their correctness.  The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities.  Neither the Trustee nor any Authenticating
Agent shall be accountable for the use or application by the Company of
Securities or the proceeds thereof.

 

Section 605.                               May Hold
Securities.  The Trustee, any
Authenticating Agent, any Paying Agent, any Security Registrar or any other
agent of the Company, in its individual or any other capacity, may become the
owner or pledgee of Securities and, subject to Sections 608 and 613, may
otherwise deal with the Company with the same rights it would have if it were
not Trustee, Authenticating Agent, Paying Agent, Security Registrar or such
other agent.

 

Section 606.                               Money
Held in Trust.  Money held by the
Trustee in trust hereunder need not be segregated from other funds except to
the extent required by law.  The Trustee
shall be under no liability for interest on any money received by it hereunder
except as agreed with the Company herein or otherwise.

 

Section 607.                               Compensation
and Reimbursement.  The Company
agrees:

 

(1)                                 to
pay to the Trustee from time to time reasonable compensation for all services
rendered by it hereunder (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust);

 

42

 

(2)                                 except
as otherwise expressly provided herein, to reimburse the Trustee upon its
request for all reasonable expenses, disbursements and advances incurred or
made by the Trustee in accordance with any provision of this Indenture and
incurred or made without negligence, willful misconduct or bad faith of it or
of its agents or attorneys (including the reasonable compensation,
disbursements and expenses of its agents or attorneys);

 

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

 

(4)                                 without
limiting any rights available to the Trustee under applicable law, that when
the Trustee incurs expenses or renders services in connection with an Event of
Default specified in Section 501(4) or Section 501(5), the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable federal or state bankruptcy, insolvency or
other similar law.

 

Section 608.                               Disqualification;
Conflicting Interests.  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.  To the extent permitted by the Trust
Indenture Act, the Trustee shall not be deemed to have a conflicting interest
by virtue of being a trustee under this Indenture with respect to Securities of
more than one series, or by virtue of being a Trustee under this Indenture and
under [(i) the Indenture dated as
of October 11, 2006 between the Company and The Bank of New York, as
Trustee or (ii)                                           ].

 

Section 609.                               Corporate
Trustee Required; Eligibility.  The
Trustee shall at all times satisfy the requirements of Section 310(a) of
the Trust Indenture Act.  The Trustee
shall (i) be a corporation organized and doing business under the
laws of the United States of America, any State thereof or the District of
Columbia, (ii) be authorized under such laws to exercise corporate
trust powers, (iii) have a combined capital and surplus of at least
$50,000,000, and (iv) be subject to supervision or examination by
Federal or State authority.  If such
corporation files reports of condition at least annually, pursuant to law or to
the requirements of said supervising or examining authority, then for the
purposes 

 

43

 

of this Section,
the combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so filed.  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.  If at
any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article Six.  Neither the Company nor any Person directly
or indirectly controlling, controlled by or under common control with the
Company shall serve as Trustee for the Securities of any series issued
hereunder.

 

Section 610.                               Resignation
and Removal; Appointment of Successor. 
No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until
the acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.

 

The Trustee may
resign as Trustee at any time with respect to the Securities of one or more
series by giving written notice thereof to the Company.  If the instrument of acceptance by a
successor Trustee required by Section 611 shall not have been delivered to
the resigning Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may, at the expense of the Company, petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Securities of such series.

 

The Trustee may be
removed as Trustee hereunder at any time with respect to the Securities of any
series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Company.

 

If at any time an
instrument of acceptance by a successor Trustee required by Section 611
shall not have been delivered to the Trustee within 30 days after the date a
notice of removal is delivered to the Trustee, the Trustee being removed may,
at the expense of the Company, petition any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such
series.

 

If at any time:

 

(1)                                 the
Trustee shall fail to comply with Section 608 after written request therefor
by the Company or by any Holder who has been a bona fide Holder of a Security
for at least six months; or

 

(2)                                 the
Trustee shall cease to be eligible under Section 609 and shall fail to
resign after written request therefor by the Company or by any such Holder; or

 

44

 

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

 

then, in any such case, (A) the
Company by a Board Resolution may remove the Trustee, or (B) subject
to Section 514, any Holder who has been a bona fide Holder of a Security
for at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee or Trustees.

 

If the Trustee
shall resign, be removed or become incapable of acting, or if a vacancy shall
occur in the office of Trustee for any cause with respect to the Securities of
one or more series, the Company, by a Board Resolution, shall promptly appoint
a successor Trustee or Trustees with respect to the Securities of that or those
series and shall comply with the applicable requirements of Section 611.  If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
with respect to the Securities of any series shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities of such
series delivered to the Company and the retiring Trustee, the successor Trustee
so appointed shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 611, become the
successor Trustee with respect to the Securities of such series and to that
extent supersede the successor Trustee appointed by the Company.  If no successor Trustee with respect to the
Securities of any series shall have been so appointed by the Company or the
Holders and shall have accepted appointment in the manner required by Section 611,
any Holder who has been a bona fide Holder of a Security for at least six
months may, subject to Section 514, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.

 

The Company shall
give notice of each resignation and each removal of the Trustee with respect to
the Securities of any series and each appointment of a successor Trustee with
respect to the Securities of any series by mailing written notice of such event
by first class mail, postage prepaid, to the Holders of Securities of such
series as their names and addresses appear in the Security Register.  Each notice shall include the name of the
successor Trustee with respect to the Securities of such series and the address
of its Corporate Trust Office.

 

Section 611.                               Acceptance
of Appointment by Successor.

 

(a)                                 In
the case of the appointment hereunder of a successor Trustee with respect to
all Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring 

 

45

 

Trustee shall
become effective and such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee; but, on the request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder.

 

(b)                                In
case of the appointment hereunder of a successor Trustee with respect to the
Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of one or
more series shall execute and deliver an indenture supplemental hereto wherein
each successor trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Trustee all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of
that or those series to which the appointment of such successor Trustee
relates, (2) if the retiring Trustee is not retiring with respect
to all Securities, shall contain such provisions as shall be deemed necessary
or desirable to confirm that all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of that or those series as to
which the retiring Trustee is not retiring shall continue to be vested in the
retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts, and duties
of the retiring Trustee with respect to the Securities of that or those series
to which the appointment of such successor Trustee relates; but, on request of
the Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates.

 

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

 

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

 

46

 

Section 612.                               Merger,
Conversion, Consolidation or Succession to Business.  Any corporation into which the Trustee may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion 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, shall be the successor of the
Trustee hereunder, provided such corporation shall be otherwise qualified and
eligible under this Article, without the execution or filing of any paper or
any further act on the part of any of the parties hereto.  In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.

 

Section 613.                               Preferential
Collection of Claims Against Company. 
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims
against the Company (or any such other obligor).

 

Section 614.                               Appointment
of Authenticating Agent.  The Trustee
may appoint an Authenticating Agent or Agents with respect to one or more
series of Securities which shall be authorized to act on behalf of the Trustee
to authenticate Securities of such series issued upon original issue and upon
exchange, registration of transfer or partial redemption thereof or pursuant to
Section 306, and Securities so authenticated shall be entitled to the
benefits of this Indenture and shall be valid and obligatory for all purposes
as if authenticated by the Trustee hereunder. 
Wherever reference is made in this Indenture to the authentication and
delivery of Securities by the Trustee or the Trustee’s certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Trustee by an Authenticating
Agent.  Each Authenticating Agent shall
be acceptable to the Company and shall at all times be a corporation organized
and doing business under the laws of the United States of America, any State,
Territory or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by Federal or State authority.  If such Authenticating Agent files reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Authenticating Agent shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so filed.

 

If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect specified in this Section.

 

47

 

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

 

An
Authenticating Agent may resign at any time by giving written notice thereof to
the Trustee and to the Company.  The
Trustee may at any time terminate the agency of an Authenticating Agent by
giving written notice thereof to such Authenticating Agent and to the
Company.  Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 106 to all Holders of
Securities of the series with respect to which such Authenticating Agent will
serve.  Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent.

 

No
successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.

 

The
Company agrees to pay to each Authenticating Agent from time to time compensation
for its services under this Section as agreed to in writing between the
parties.

 

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

 

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

 

	
   

  	
  The Bank of New York Trust Company, 

  
	
   

  	
  N.A., as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   As Authenticating Agent

  

 

	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   Authorized Signatory

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
					

 

48

 

ARTICLE SEVEN

 

Holders’
Lists and Reports by Trustee and Company

 

Section 701.                                Company
to Furnish Trustee Names and Addresses of Holders.  The Company will furnish or cause to be
furnished to the Trustee:

 

(1)                                  semi-annually,
not more than 15 days after each Regular Record Date, a list, in such form as
the Trustee may reasonably require, of the names and addresses of the Holders
as of such Regular Record Date; and

 

(2)                                  at
such other times as the Trustee may request in writing, within 30 days after
the receipt by the Company of any such request, a list of similar form and
content as of a date not more than 15 days prior to the time such list is
furnished; provided, that no such list need be provided in any case to
the extent it would include names and addresses received by the Trustee in its
capacity as Security Registrar.

 

Section 702.                                Preservation
of Information; Communications to Holders. 
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar.  The Trustee may destroy any
list furnished to it as provided in Section 701 upon receipt of a new list
so furnished.

 

The
rights of Holders to communicate with other Holders with respect to their
rights under this Indenture or under the Securities, and the corresponding
rights and privileges of the Trustee, shall be as provided by the Trust
Indenture Act.

 

Every
Holder of Securities, by receiving and holding the same, agrees with the
Company and the Trustee that neither the Company 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 made pursuant to the Trust
Indenture Act.

 

49

 

Section 703.                                Reports
by Trustee.  The Trustee shall
transmit to Holders such reports 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.  If required by Section 313(a) of
the Trust Indenture Act, the Trustee shall, within 60 days after each May 15
following the date of this Indenture, deliver to Holders a brief report, dated
as of such May 15, which complies with the provisions of such Section 313(a).

 

A copy
of each such report shall, at the time of such transmission to Holders, be
filed by the Trustee with each stock exchange, if any, upon which any
Securities are listed, with the Commission and with the Company.  The Company will notify the Trustee whenever
any Securities are listed on any stock exchange and any delisting thereof.

 

Section 704.                                Reports
by Company.  The Company shall:

 

(1)                                  file
with the Trustee, within 15 days after the Company files the same with the
Commission, copies of the annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations prescribe) which
the Company may be required to file with the Commission pursuant to Section 13
or Section 15(d) of the Exchange Act; or, if the Company is not
required to file information, documents or reports pursuant to either of said
Sections, then it shall file with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the Commission,
such of the supplementary and periodic information, documents and reports which
may be required pursuant to Section 13 of the Exchange Act in respect of a
security listed and registered on a national securities exchange as may be
prescribed from time to time in such rules and regulations.  All reports, information and documents
described in this paragraph 704(1) and filed with the Commission pursuant
to its Electronic Data Gathering, Analysis and Retrieval (EDGAR) system or any
successor system shall be deemed to be filed with the Trustee.  The Company also shall at all times comply
with the provisions of Section 314(a) of the Trust Indenture Act;

 

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

 

(3)                                  transmit
by mail, to all Holders, as their names and addresses appear in the Security
Register, within 30 days after the filing thereof with the Trustee, such summaries
of any information, documents and reports required to 

 

50

 

be filed by the Company
pursuant to Clauses (1) and (2) of this Section as may be
required by rules and regulations prescribed from time to time by the
Commission.

 

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 Company’s compliance with any of
its covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers’ Certificates).

 

ARTICLE EIGHT

 

Consolidation,
Merger, Conveyance, Transfer or Lease

 

Section 801.                                Company
May Consolidate, Etc., Only on Certain Terms.

 

(a)                                  Subject
to Section 801(c), the Company shall not consolidate with or merge with or
into any other Person or convey, transfer or lease its assets substantially as
an entirety to any Person, and the Company shall not permit any Person to
consolidate with or merge with or into the Company, unless:

 

(1)                                  the
Company is the surviving corporation in a merger or consolidation; or

 

(2)                                  in
case the Company shall consolidate with or merge into another Person or convey,
transfer or lease its assets substantially as an entirety to any Person, the
Person formed by such consolidation or into which the Company is merged or the
Person which acquires by conveyance or transfer, or which leases, the assets of
the Company substantially as an entirety shall be a corporation, partnership,
trust or limited liability company, organized and validly existing under the
laws of the United States of America, any State thereof or the District of
Columbia and shall expressly assume, by an indenture supplemental hereto,
executed and delivered to the Trustee, the due and punctual payment of the
principal of and any premium and interest on all the Securities and the
performance or observance of every covenant of this Indenture on the part of
the Company to be performed or observed; and

 

(3)                                  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

 

(4)                                  the
Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that such consolidation, merger, 

 

51

 

conveyance, transfer or
lease and, if a supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article and that
all conditions precedent herein provided for relating to such transaction have
been complied with.

 

(b)                                 Subject
to Section 801(c), any indebtedness which becomes an obligation of the
Company or any Subsidiary as a result of any such transaction shall be treated
as having been incurred by the Company or such Subsidiary at the time of such
transaction.

 

(c)                                  The
provisions of Section 801(a) and (b) shall not be applicable to:

 

(1)                                  the
direct or indirect conveyance, transfer or lease of all or any portion of the
stock, assets or liabilities of any of the Company’s wholly owned Subsidiaries
to the Company or to other wholly owned Subsidiaries of the Company; or

 

(2)                                  any
recapitalization transaction, a change of control of the Company or a highly
leveraged transaction unless such transaction or change of control is
structured to include a merger or consolidation by the Company or the
conveyance, transfer or lease of the Company’s assets substantially as an
entirety.

 

Section 802.                                Successor
Corporation Substituted.  Upon any
consolidation of the Company with, or merger of the Company into, any other
Person or any conveyance, transfer or lease of the assets of the Company
substantially as an entirety in accordance with Section 801, the successor
Person formed by such consolidation or into which the Company is merged or to
which such conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor Person had been named
as the Company herein, and thereafter, except in the case of any lease, the
Company shall be relieved of all obligations and covenants under this Indenture
and the Securities and may be dissolved and liquidated.

 

In
case of any such consolidation, merger, conveyance, transfer or lease, such
changes in phraseology and form may be made in the Securities thereafter to be
issued as may be appropriate.

 

ARTICLE NINE

 

Supplemental
Indentures

 

Section 901.                                Supplemental
Indentures Without Consent of Holders. 
Without the consent of any Holders, the Company and, if applicable, the
Subsidiary Guarantor, in each case when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental hereto or, if applicable, 

 

52

 

into agreements
supplemental to any Subsidiary Guarantee, in form satisfactory to the Trustee,
for any of the following purposes:

 

(1)                                  to
evidence the succession of another Person to the Company and the assumption by
any such successor of the covenants of the Company herein and in the Securities
or, if applicable, to evidence the succession of another Person to the
Subsidiary Guarantor and the assumption by any such successor of the Subsidiary
Guarantor’s obligations under any Subsidiary Guarantee (in either case with such
changes herein and therein as may be necessary or advisable to reflect such
Person’s legal status, if such Person is not a corporation); or

 

(2)                                  to
convey, transfer, assign, mortgage or pledge any property to or with the
Trustee or to surrender any right or power herein conferred upon the Company;
or

 

(3)                                  to
provide for the issuance under this Indenture of Securities in bearer form
(including securities registrable as to principal only) and to provide for
exchangeability of such Securities for Securities issued hereunder in fully
registered form, and to make all appropriate changes for such purpose; or

 

(4)                                  to
establish the form or terms of Securities of any series as permitted by
Sections 201 or 301; or

 

(5)                                  to
add to the covenants of the Company or the Subsidiary Guarantor for the benefit
of the Holders of all Securities or any series of Securities (and if such
covenants are to be for the benefit of less than all series of Securities,
stating that such covenants are expressly being included solely for the benefit
of such series) or to surrender any right or power herein conferred upon the
Company or the Subsidiary Guarantor; or

 

(6)                                  to
add any additional Events of Default; or

 

(7)                                  to
secure the Securities; or

 

(8)                                  to
evidence and provide for the acceptance of appointment hereunder by a successor
Trustee with respect to the Securities of one or more series and to add to or
change any provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one Trustee
pursuant to the requirements of Section 611(b); or

 

(9)                                  to
cure any ambiguity, to correct or supplement any provision herein, in any
Securities or in any Subsidiary Guarantee, which may be defective or
inconsistent with any other provision herein, or to make any other provisions
with respect to matters or questions arising under this Indenture as the
Company 

 

53

 

and the Trustee may deem
necessary and desirable, provided that such action pursuant to this
Clause (9) shall not adversely affect the interests of the Holders of
Securities of any series in any material respect; or

 

(10)                            to
comply with the requirements of the Commission in order to effect or maintain
the qualification of this Indenture or any Subsidiary Guarantee under the Trust
Indenture Act or otherwise as necessary to comply with applicable law; or

 

(11)                            to
modify the provisions in Article Twelve of this Indenture with respect to
the subordination of Outstanding Securities of any series in a manner not
materially adverse to the Holders thereof; or

 

(12)                            to
make any change that does not adversely affect the rights of any Holder in any
material respect.

 

Section 902.                                Supplemental
Indentures With Consent of Holders. 
With the consent of the Holders of not less than a majority in principal
amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company, the
Subsidiary Guarantor and the Trustee, the Company and, if applicable, the
Subsidiary Guarantor, in each case when authorized by a Board Resolution, and
the Trustee may enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Indenture or of modifying in any manner the
rights of the Holders of Securities of such series under this Indenture and, if
applicable, the Subsidiary Guarantor and the Trustee may enter into an
agreement or agreements supplemental hereto to add to or to change or eliminate
any provisions of a Subsidiary Guarantee; provided, however, that
no such supplemental indenture shall, without the consent of the Holder of each
Outstanding Security affected thereby:

 

(1)                                  change
the Stated Maturity of the principal of, or any installment of interest payable
on, any Outstanding Security, or reduce the principal amount of or the rate of
interest thereon or any premium payable upon the redemption thereof, or reduce
the amount of principal of an Original Issue Discount Security that would be
due and payable upon redemption or would be provable in bankruptcy, or
adversely affect any right of repayment of the Holder of any Security or change
the Place of Payment or the coin or currency in which, any Outstanding Security
or the interest thereon is payable, or impair the right to institute suit for
the enforcement of any such payment on or after the Stated Maturity thereof
(or, in the case of redemption, on or after the Redemption Date); or

 

(2)                                  reduce
the percentage in principal amount of the Outstanding Securities of any series,
the consent of whose Holders is required for any such 

 

54

 

supplemental indenture,
or the consent of whose Holders is required for any waiver of compliance with
certain provisions of this Indenture or certain defaults hereunder and their
consequences or reduce the quorum or voting requirements provided for in this
Indenture; or

 

(3)                                  modify
any of the provisions of this Section, Section 513 or Section 1008,
except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent
of the Holder of each Outstanding Security affected thereby; provided,
however, that this clause shall not be deemed to require the consent of any
Holder with respect to changes in the references to “the Trustee” and
concomitant changes in this Section and Section 1008, or the deletion
of this proviso, in accordance with the requirements of Section 611 and
901(8); or

 

(4)                                  modify
the provisions of Article Twelve of this Indenture with respect to the
subordination of Outstanding Securities of any series in a manner materially
adverse to the Holders thereof.

 

A
supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture, or a supplemental agreement which changes or
eliminates any covenant or other provision of a Subsidiary Guarantee, which has
expressly been included solely for the benefit of one or more particular series
of Securities, or which modifies the rights of the Holders of Securities of
such series with respect to such covenant or other provision, shall be deemed
not to affect the rights under this Indenture of the Holders of Securities of
any other series.

 

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

 

Section 903.                                Execution
of Supplemental Indentures.  In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the
trusts created by this Indenture, the Trustee shall be provided with, and
(subject to Section 601) shall be fully protected in relying upon, an
Officers’ Certificate and an Opinion of Counsel each stating that the execution
of such supplemental indenture is authorized or permitted by this Indenture,
and that all conditions precedent have been complied with.  The Trustee may, but shall not be obligated
to, enter into any such supplemental indenture which affects the Trustee’s own
rights, duties, protections, privileges, indemnities, liabilities or immunities
under this Indenture or otherwise.

 

Section 904.                                Effect
of Supplemental Indentures.  Upon the
execution of any supplemental indenture under this Article, this Indenture
shall be modified in accordance therewith, and such supplemental indenture
shall form a part of this Indenture for all 

 

55

 

purposes; and every
Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.

 

Section 905.                                Conformity
with Trust Indenture Act.  Every
supplemental indenture executed pursuant to this Article shall conform to
the requirements of the Trust Indenture Act as then in effect.

 

Section 906.                                Reference
in Securities to Supplemental Indentures. 
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any
matter provided for in such supplemental indenture.  If the Company shall so determine, new
Securities of any series so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any such supplemental indenture may be
prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.

 

ARTICLE TEN

 

Covenants

 

Section 1001.                          Payment
of Principal, Premium and Interest. 
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of, premium, if
any, and interest on the Securities of that series in accordance with the terms
of such Securities and this Indenture.

 

Unless
otherwise specified as contemplated by Section 301, the Company shall pay
interest on overdue amounts at the rate set forth in the first paragraph of the
Securities, and it shall pay interest on overdue interest at the same rate (to
the extent that the payment of such interest shall be legally enforceable),
which interest on overdue interest shall accrue from the date such amounts
became overdue.

 

Section 1002.                          Maintenance
of Office or Agency.  The Company
will maintain in the Borough of Manhattan, The City of New York and each other
Place of Payment for any series, an office or agency where Securities of that
series may be presented or surrendered for payment, and an office or agency
where Securities may be surrendered for registration of transfer or exchange
and where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. 
The Company initially appoints the Trustee, acting through an affiliate
of its Corporate Trust Office, as its agent for said purposes.  The Company will give prompt written notice
to the Trustee of the location, and any change in the location, of any such
office or agency.  If at any time the
Company shall fail to maintain any such required office or agency or shall fail
to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office, and the Company hereby 

 

56

 

appoints the Trustee as
its agent to receive all such presentations, surrenders, notices and demands.

 

The
Company may also from time to time designate one or more other offices or
agencies where the Securities may be presented or surrendered for any or all
such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York and each other Place of Payment for
Securities of any series for such purposes. 
The Company will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other
office or agency.

 

Section 1003.                          Money
for Securities Payments to Be Held in Trust.  If the Company shall at any time act as its
own Paying Agent with respect to any series of Securities, it will, on or
before each due date of the principal of or premium, if any, or interest on any
of the Securities of such series, segregate and hold in trust for the benefit
of the Persons entitled thereto a sum sufficient to pay the principal, premium,
if any, and any interest so becoming due until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and will promptly notify
the Trustee of its action or failure so to act.

 

Whenever
the Company shall have one or more Paying Agents, it will, prior to each due
date of the principal of or interest on any Securities, deposit with a Paying
Agent a sum sufficient to pay the principal (and premium, if any) or interest
so becoming due, such sum to be held as provided by the Trust Indenture Act,
and (unless such Paying Agent is the Trustee) the Company will promptly notify
the Trustee of its action or failure so to act.

 

The
Company will cause each Paying Agent other than the Trustee to execute and
deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section, that such Paying
Agent will (1) comply with the provisions of the Trust Indenture
Act applicable to it as a Paying Agent, (2) give the Trustee notice
of any default by the Company (or any other obligor upon the Securities) in the
making of any payment of principal (and premium, if any) or interest, and (3) at
any time during the continuance of any such default, upon the written request
of the Trustee, forthwith pay to the Trustee all sums so held in trust by such
Paying Agent.

 

The
Company may at any time, for the purpose of obtaining the satisfaction and
discharge of this Indenture or for any other purpose, pay, or by Company Order
direct any Paying Agent to pay, to the Trustee all sums held in trust by the
Company or such Paying Agent, such sums to be held by the Trustee upon the same
trusts as those upon which such sums were held by the Company or such Paying
Agent; and, upon such 

 

57

 

payment by the Company or any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.

 

Any
money or U.S. Government Obligation (including the proceeds thereof and the
interest thereon) deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of, premium, if any,
or interest on any Security and remaining unclaimed for two years after such
principal, premium, if any, or interest has become due and payable shall be
paid to the Company at its option on Company Request (unless otherwise required
by mandatory provision of applicable escheat or abandoned or unclaimed property
law) or (if then held by the Company) shall (unless otherwise required by
mandatory provision of applicable escheat or abandoned or unclaimed property
law) be discharged from such trust; and the Holder of such Security shall
thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in a newspaper
published in the English language, customarily published on each Business Day
and of general circulation in the Borough of Manhattan, The City of New York,
notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid
to the Company.

 

Section 1004.                          Statement
by Officers as to Default.  The
Company will deliver to the Trustee, within 120 days after the end of each
fiscal year of the Company ending after the date hereof, an Officers’
Certificate covering the preceding fiscal year, stating whether or not, to the
best knowledge of the signers thereof, the Company is in default in the
performance and observance of any of the terms, provisions and conditions of
this Indenture (without regard to any period of grace or requirement of notice
provided hereunder) and, if the Company shall be in default, specifying all
such defaults and the nature and status thereof of which they may have
knowledge.

 

Section 1005.                          Existence.  Subject to Article Eight, the Company
will do or cause to be done all things necessary to preserve and keep in full
force and effect its legal existence, rights (charter and statutory) and
franchises; provided, however, that the Company shall not be
required to preserve any such right or franchise if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct
of the business of the Company and that the loss thereof is not disadvantageous
in any material respect to the Holders.

 

Section 1006.                          Payment
of Taxes.  The Company will pay or
discharge or cause to be paid or discharged, before the same shall become
delinquent, all taxes, assessments and governmental charges levied or imposed
upon the Company or any Restricted Subsidiary or upon the income, profits or
property of the Company or any Restricted 

 

58

 

Subsidiary, and lawful
claims for labor, materials and supplies, which, if unpaid, might by law become
a Lien upon the property of the Company or any Restricted Subsidiary; provided,
however, that the Company shall not be required to pay or discharge or
cause to be paid or discharged any such tax, assessment or governmental charge
whose amount, applicability or validity is being contested in good faith by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Securities.

 

Section 1007.                          Limitation
on Liens.  The Company will not, nor
will it permit any Restricted Subsidiary, directly or indirectly, to, create,
issue, assume, incur, or guarantee or become liable with respect to
indebtedness for money borrowed if such indebtedness is secured by a Lien on
any present or future common stock of any Restricted Subsidiary (whether such
shares of common stock are now owned or hereafter acquired) without in any such
case making or causing to be made effective a provision (and the Company
covenants that in any such case it shall make or cause to be made effective
such provision) whereby the Securities, will be secured equally and ratably
with, or prior to, such indebtedness or guarantee; it being understood that in
such event the Company may also so secure any other such indebtedness of the
Company or such Restricted Subsidiary entitled thereto, subject to any
applicable priority of payment.

 

Section 1008.                          Waiver
of Certain Covenants.  The Company
may omit in any particular instance to comply with any term, provision,
covenant or condition set forth in any covenant provided pursuant to Section 901(5) for
the benefit of the Holders or in any of Sections 1006 and 1007, with respect to
the Securities of any series if before or after the time for such compliance
the Holders of at least a majority in principal amount of the Outstanding
Securities of such series shall, by Act of such Holders, either waive such
compliance in such instance or generally waive compliance with such term,
provision or condition, but no such waiver shall extend to or affect such term,
provision or condition except to the extent so expressly waived, and, until
such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such term, provision or condition shall
remain in full force and effect.

 

Section 1009.                          Calculation
of Original Issue Discount.  The
Company shall file with the Trustee promptly at the end of each calendar year (i) a
written notice specifying the amount of original issue discount (including
daily rates and accrual periods) accrued on Outstanding Securities as of the
end of such year and (ii) such other specific information relating
to such original issue discount as may then be relevant under the Internal
Revenue Code of 1986, as amended from time to time.

 

59

 

ARTICLE ELEVEN

 

Redemption
of Securities

 

Section 1101.         Company’s Right of Redemption.  Unless otherwise specified as contemplated by
Section 301 with respect to the Securities of a particular series, and
notwithstanding any additional redemption rights that may be so specified, the
Company may, at its option, redeem the Securities of any series after their
date of issuance in whole or in part at any time and from time to time, subject
to the provisions of this Section 1101 and the other provisions of this Article Eleven.  Unless otherwise specified as contemplated by
Section 301 with respect to the Securities of a particular series, the
redemption price for any Security so redeemed shall be equal to 100% of the
principal amount of such Securities then Outstanding plus accrued and unpaid
interest up to, but excluding, the date fixed for redemption; provided, however,
that installments of accrued and unpaid interest whose Stated Maturity is on or
prior to the Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, registered as such at the close of
business on the relevant Regular Record Dates according to their terms and the
provisions of Section 307, unless otherwise so specified.

 

Section 1102.         Applicability of Article.  Redemption of Securities, as permitted or
required by any form of Security issued pursuant to this Indenture or the
documentation providing therefor, shall be made in accordance with such form of
Security or documentation and this Article Eleven; provided, however,
that if any provision of any such form of Security or documentation shall
conflict with any provision of this Article, the provision of such form of
Security or documentation shall govern. 
Except as otherwise set forth in the form of Security for such series or
such documentation, each Security shall be subject to partial redemption only
in the amount of $1,000 or integral multiples of $1,000.

 

Section 1103.         Election to Redeem; Notice to
Trustee.  The election of the Company
to redeem any Securities shall be evidenced by or pursuant to a Board
Resolution.  In case of any redemption at
the election of the Company of the Securities of a series, the Company shall,
at least 45 days but not more than 60 days prior to the Redemption Date fixed
by the Company (unless a shorter notice shall be satisfactory to the Trustee),
notify the Trustee of such Redemption Date, of the principal amount of
Securities to be redeemed and, if applicable, of the tenor of the Securities to
be redeemed.  In the case of any
redemption of Securities (a) prior to the expiration of any
restriction on such redemption provided in the terms of such Securities or (b) pursuant
to an election of the Company which is subject to a condition specified in the
terms of such Securities, the Company shall furnish the Trustee with an
Officers’ Certificate and an Opinion of Counsel evidencing compliance with such
restriction or condition.

 

Section 1104.         Selection by Trustee of Securities
to Be Redeemed.  If less than all the
Securities are to be redeemed (unless such redemption affects only a single
Security), 

 

60

 

the particular Securities
to be redeemed shall be selected not more than 45 days prior to the Redemption
Date by the Trustee, from the Outstanding Securities not previously called for
redemption, by such method as the Trustee in its sole discretion shall deem
fair and appropriate and which may provide for the selection for redemption of
a portion of the principal amount of any Security, provided that the
unredeemed portion of the principal amount of any Security shall be in an
authorized denomination (which shall not be less than the minimum authorized
denomination) for such Security.  If less
than all the Securities and of a specified tenor are to be redeemed (unless
such redemption affects only a single Security), the particular Securities to
be redeemed shall be selected not more than 45 days prior to the Redemption
Date by the Trustee, from the Outstanding Securities and specified tenor not
previously called for redemption in accordance with the preceding sentence.

 

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

 

The
provisions of the two preceding paragraphs shall not apply with respect to any
redemption affecting only a single Security, whether such Security is to be
redeemed in whole or in part.  In the
case of any such redemption in part, the unredeemed portion of the principal
amount of the Security shall be in an authorized denomination (which shall not
be less than the minimum authorized denomination) for such Security.

 

For
all purposes of this Indenture, unless the context otherwise requires, all
provisions relating to the redemption of Securities shall relate, in the case
of any Securities redeemed or to be redeemed only in part, to the portion of
the principal amount of such Securities which has been or is to be redeemed. If
the Company shall so direct, Securities registered in the name of the Company,
any Affiliate or any Subsidiary thereof shall not be included in the Securities
selected for redemption.

 

Section 1105.         Notice of Redemption.  Unless otherwise specified as contemplated by
Section 301 with respect to the Securities of a particular series, notice
of redemption shall be given by first class mail, postage prepaid, mailed not
less than 30 nor more than 60 days prior to the Redemption Date, to each Holder
of Securities to be redeemed, at its address appearing in the Security
Register.  Unless the Company defaults in
payment of the Redemption Price, on and after the Redemption Date, interest
shall cease to accrue on the Securities.

 

All
notices of redemption shall state:

 

(1)           the Redemption Date;

 

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

 

61

 

(3)           if less than all the Outstanding
Securities consisting of more than a single Security are to be redeemed, the
identification (and, in the case of partial redemption of any such Securities,
the principal amounts) of the particular Securities to be redeemed and, if less
than all the Outstanding Securities consisting of a single Security are to be
redeemed, the principal amount of the particular Security to be redeemed;

 

(4)           that on the Redemption Date the
Redemption Price will become due and payable upon each such Security to be
redeemed and, if applicable, that interest thereon will cease to accrue on and
after said date;

 

(5)           the place or places where each such
Security is to be surrendered for payment of the Redemption Price; and

 

(6)           the CUSIP numbers, if any.

 

Notice
of redemption of Securities to be redeemed at the election of the Company shall
be given by the Company or, at the Company’s request, by the Trustee in the
name and at the expense of the Company and shall be irrevocable. The notice if
mailed in the manner herein provided shall be conclusively presumed to have
been duly given, whether or not the Holder receives such notice.  In any case, a failure to give such notice by
mail or any defect in the notice to the Holder of any Security designated for
redemption as a whole or in part shall not affect the validity of the
proceedings for the redemption of any other Security.

 

Section 1106.         Deposit of Redemption Price.  Prior to 10:00 a.m. New York City time
on any Redemption Date, the Company shall deposit with the Trustee or with a
Paying Agent (or, if the Company is acting as its own Paying Agent, segregate
and hold in trust as provided in Section 1003) an amount of money
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) accrued interest on, all the Securities
which are to be redeemed on that date.

 

Section 1107.         Securities Payable on Redemption
Date.  Notice of redemption having
been given pursuant to Section 1105, the Securities to be so redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear or accrue any interest.  Upon surrender of any such Security for
redemption in accordance with said notice, such Security shall be paid by the
Company at the Redemption Price, together with any accrued but unpaid interest
to, but excluding, the Redemption Date; provided, however, that
installments of accrued and unpaid interest whose Stated Maturity is on or
prior to the Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, registered as such at the close of
business on the relevant Regular Record Dates according to their terms and the
provisions of Section 307, unless 

 

62

 

in connection with a
Redemption Date falling on an Interest Payment Date, the Securities of the
particular series provide that interest payable on an Interest Payment Date
that is a Redemption Date shall be paid to the Person to whom principal is
payable.

 

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

 

Section 1108.         Securities Redeemed in Part.  Any Security which is to be redeemed only in
part shall be surrendered at a Place of Payment therefor (with, if the Company
or the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company and the Trustee duly executed by,
the Holder thereof or his attorney duly authorized in writing), and the Company
shall execute, and the Trustee shall authenticate and deliver to the Holder of
such Security without service charge, a new Security or Securities of like
tenor, of any authorized denomination as requested by such Holder, in aggregate
principal amount equal to and in exchange for the unredeemed portion of the
principal of the Security so surrendered.

 

ARTICLE TWELVE

 

Subordination
of Securities

 

Section 1201.         Securities Subordinate to Senior
Indebtedness of the Company.  The
Company covenants and agrees, and each Holder of a Security, by its acceptance
thereof, likewise covenants and agrees, that, to the extent and in the manner
hereinafter set forth in this Article, the payment of the principal of (and
premium, if any) and interest on each and all of the Securities are hereby
expressly made subordinate and subject in right of payment to the prior payment
in full of all amounts then due and payable in respect of all Senior
Indebtedness of the Company. Each Holder, by its acceptance hereof, waives all
notice of acceptance of the subordination provisions contained herein by each
holder of Senior Indebtedness of the Company, whether now outstanding or
hereafter incurred and waives reliance by each such holder upon said
provisions.

 

Section 1202.         Payment Over Proceeds Upon
Dissolution, Etc.  Upon any payment
or distribution of assets to creditors upon any liquidation, dissolution,
winding up, reorganization, assignment for the benefit of creditors, marshaling
of assets or any bankruptcy, insolvency, debt restructuring or similar
proceedings in connection with the Company’s insolvency or bankruptcy (each
such event, if any, herein sometimes referred to as a “Proceeding”), the
holders of Senior Indebtedness of the Company shall be entitled to receive
payment in full of principal of (and premium, if any) and interest, if any, on
such Senior Indebtedness, or provision shall be made for such payment in cash
or cash equivalents or otherwise in a manner satisfactory to the holders of
such Senior Indebtedness, before the Holders of the Securities are entitled to
receive or retain any payment or distribution of any kind or character, whether
in cash, property or securities 

 

63

 

(including any payment or
distribution which may be payable or deliverable by reason of the payment of
any other Indebtedness of the Company (including any series of the Securities)
subordinated to the payment of the Securities, such payment or distribution
being hereinafter referred to as a “Junior Subordinated Payment”), on
account of principal of (or premium, if any) or interest on the Securities or
on account of the purchase or other acquisition of Securities by the Company or
any Subsidiary and to that end the holders of Senior Indebtedness of the
Company shall be entitled to receive, for application to the payment thereof,
any payment or distribution of any kind or character, whether in cash, property
or securities, including any Junior Subordinated Payment, which may be payable or
deliverable in respect of the Securities in any such Proceeding.

 

In the
event that, notwithstanding the foregoing provisions of this Section, the
Trustee or the Holder of any Security shall have received any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, including any Junior Subordinated Payment, before
all Senior Indebtedness of the Company is paid in full or payment thereof is
provided for in cash or cash equivalents or otherwise in a manner satisfactory
to the holders of such Senior Indebtedness, and if written notice thereof from
the Company or any holder of such Senior Indebtedness (or any trustee, agent or
representative therefor) shall, at least three Business Days prior to the time
of such payment or distribution, have been received by a Responsible Officer of
the Trustee or, as the case may be, such Holder, then and in such event such
payment or distribution shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee,
agent or other Person making payment or distribution of assets of the Company
for application to the payment of all Senior Indebtedness remaining unpaid, to
the extent necessary to pay all Senior Indebtedness of the Company in full,
after giving effect to any concurrent payment or distribution to or for the
holders of such Senior Indebtedness.

 

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

 

64

 

substantially as an entirety, as the case may be,
shall, as a part of such consolidation, merger, or sale comply with the
conditions set forth in Article Eight.

 

Section 1203.         Prior Payment to Senior Indebtedness
of the Company Upon Acceleration of Securities.  In the event that any Securities are declared
due and payable before their Stated Maturity, then and in such event the
holders of the Senior Indebtedness of the Company outstanding at the time such
Securities so become due and payable shall be entitled to receive payment in full
of all amounts due on or in respect of such Senior Indebtedness (including any
amounts due upon acceleration), or provision shall be made for such payment in
cash or cash equivalents or otherwise in a manner satisfactory to the holders
of such Senior Indebtedness, before the Holders of the Securities are entitled
to receive any payment or distribution of any kind or character, whether in
cash, properties or securities (including any Junior Subordinated Payment) by
the Company on account of the principal of (or premium, if any) or interest on
the Securities or on account of the purchase or other acquisition of Securities
by the Company or any Subsidiary; provided, however, that nothing
in this Section shall prevent the satisfaction of any sinking fund payment
in accordance with this Indenture or as otherwise specified as contemplated by Section 301
for the Securities of any series by delivering and crediting as contemplated by
Section 301 for the Securities of any series Securities which have been
acquired (upon redemption or otherwise) prior to such declaration of
acceleration.

 

In the
event that, notwithstanding the foregoing, the Company shall make any payment
to the Trustee or the Holder of any Security prohibited by the foregoing
provisions of this Section, and if written notice of such fact from the Company
or any holder of Senior Indebtedness of the Company (or any trustee, agent or
representative therefor) shall, at least three Business Days prior to the time
of such payment, have been received by a Responsible Officer of the Trustee or,
as the case may be, such Holder, then and in such event such payment shall be
paid over and delivered forthwith to the Company.

 

The
provisions of this Section shall not apply to any payment with respect to
which Section 1202 would be applicable.

 

Section 1204.         No Payment When Senior Indebtedness
of the Company in Default.  (a) In
the event and during the continuation of any default in the payment of
principal of (or premium, if any) or interest on any Senior Indebtedness of the
Company, or in the event that any event of default with respect to any such
Senior Indebtedness shall have occurred and be continuing and shall have
resulted in such Senior Indebtedness becoming or being declared due and payable
prior to the date on which it would otherwise have become due and payable,
unless and until such event of default shall have been cured or waived or shall
have ceased to exist and such acceleration shall have been rescinded or
annulled, or (b) in the event any judicial proceeding shall be
pending with respect to any such default in payment or such event of default,
then no 

 

65

 

payment or distribution
of any kind or character, whether in cash, properties or securities (including
any Junior Subordinated Payment) shall be made by the Company on account of
principal of (or premium, if any) or interest, if any, on the Securities or on
account of the purchase or other acquisition of Securities by the Company or
any Subsidiary; provided, however, that nothing in this Section shall
prevent the satisfaction of any sinking fund payment in accordance with this
Indenture or as otherwise specified as contemplated by Section 301 for the
Securities of any series by delivering and crediting pursuant to Section 1202
or as otherwise specified as contemplated by Section 301 for the
Securities of any series Securities which have been acquired (upon redemption
or otherwise) prior to such default in payment or event of default.

 

In the
event that, notwithstanding the foregoing, the Company shall make any payment
to the Trustee or the Holder of any Security prohibited by the foregoing
provisions of this Section, and if written notice thereof from the Company or
any holder of Senior Indebtedness of the Company (or any trustee, agent or
representative therefor) shall, at least three Business Days or prior to the
time of such payment, have been received by the Trustee or, as the case may be,
such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.

 

The
provisions of this Section shall not apply to any payment with respect to
which Section 1202 would be applicable.

 

Section 1205.         Payment Permitted If No Default.  Nothing contained in this Article or
elsewhere in this Indenture or in any of the Securities shall prevent (a) the
Company, at any time except during the pendency of any Proceeding referred to
in Section 1202 or under the conditions described in Sections 1203 and
1204, from making payments at any time of principal of (and premium, if any) or
interest on the Securities, or (b) the application by the Trustee
of any money or Government Obligations deposited with it hereunder to the
payment of or on account of the principal of (and premium, if any) or interest
on the Securities or the retention of such payment by the Holders, if, at least
three Business Days prior to the time of such application by the Trustee, a
Responsible Officer of the Trustee did not receive written notice from the
Company or any holder of Senior Indebtedness of the Company (or any trustee,
agent or representative therefor) that such payment would have been prohibited
by the provisions of this Article. 
Notwithstanding anything herein to the contrary, money or Government
Obligations held in trust pursuant to Section 402 shall not be subject to
the claims of the holders of Senior Indebtedness of the Company under this Article Twelve.

 

Section 1206.         Subrogation to Rights of Holders of
Senior Indebtedness of the Company. 
Subject to the payment in full of all Senior Indebtedness of the
Company, or the provision for such payment in cash or cash equivalents or
otherwise in a manner satisfactory to the holders of such Senior Indebtedness,
the Holders of the Securities shall be subrogated to the extent of the payments
or distributions made to the holders of such Senior Indebtedness pursuant to
the provisions of this Article (equally and ratably with 

 

66

 

the holders of all
indebtedness of the Company which by its express terms is subordinated to
Senior Indebtedness of the Company to substantially the same extent as the
Securities are subordinated to such Senior Indebtedness and is entitled to like
rights of subrogation by reason of any payments or distributions made to
holders of such Senior Indebtedness) to the rights of the holders of such
Senior Indebtedness to receive payments and distributions of cash, property and
securities applicable to the Senior Indebtedness of the Company until the principal
of (and premium, if any) and interest on the Securities shall be paid in
full.  For purposes of such subrogation
or assignment, no payments or distributions to the holders of the Senior
Indebtedness of the Company of any cash, property or securities to which the
Holders of the Securities or the Trustee would be entitled except for the
provisions of this Article, and no payments over pursuant to the provisions of
this Article to the holders of such Senior Indebtedness by Holders of the
Securities or the Trustee, shall, as among the Company, its creditors other
than holders of Senior Indebtedness of the Company, and the Holders of the
Securities, be deemed to be a payment or distribution by the Company to or on
account of such Senior Indebtedness.

 

Section 1207.         Provisions Solely to Define Relative
Rights.  The provisions of this Article are
and are intended solely for the purpose of defining the relative rights of the
Holders of the Securities on the one hand and the holders of Senior
Indebtedness of the Company on the other hand. 
Nothing contained in this Article or elsewhere in this Indenture or
in the Securities is intended to or shall (a) impair, as between
the Company and the Holders of the Securities, the obligations of the Company,
which are absolute and unconditional, to pay to the Holders of the Securities
the principal of (and premium, if any) and interest on the Securities as and
when the same shall become due and payable in accordance with their terms; or (b) affect
the relative rights against the Company of the Holders of the Securities and
creditors of the Company other than their rights in relation to the holders of
Senior Indebtedness of the Company; or (c) prevent the Trustee or
the Holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture including, without limitation,
filing and voting claims in any Proceeding, subject to the rights, if any,
under this Article of the holders of Senior Indebtedness of the Company to
receive cash, property and securities otherwise payable or deliverable to the
Trustee or such Holder.

 

Section 1208.         Trustee to Effectuate Subordination.  Each Holder of a Security by his or her
acceptance thereof authorizes and directs the Trustee on his or her behalf to
take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination provided in this Article and appoints the
Trustee his or her attorney-in-fact for any and all such purposes.

 

Section 1209.         No Waiver of Subordination
Provisions.  No right of any present
or future holder of any Senior Indebtedness of the Company to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or 

 

67

 

failure to act on the
part of the Company or by any act or failure to act, in good faith, by any such
holder, or by any noncompliance by the Company with the terms, provisions and
covenants of this Indenture, regardless of any knowledge thereof that any such
holder may have or be otherwise charged with.

 

Section 1210.         Notice to Trustee.  The Company shall give prompt written notice
to the Trustee of any fact known to the Company which would prohibit the making
of any payment to or by the Trustee in respect of the Securities.  Notwithstanding the provisions of this Article or
any other provision of this Indenture, the Trustee shall not be charged with
actual knowledge of the existence of any facts which would prohibit the making
of any payment to or by the Trustee in respect of the Securities, unless and
until a Responsible Officer of the Trustee shall have received written notice
thereof from the Company or a holder of Senior Indebtedness of the Company or
from any trustee, agent or representative therefor (whether or not the facts
contained in such notice are true); provided, however, that if
the Trustee shall not have received the notice provided for in this Section at
least three Business Days prior to the date upon which by the terms hereof any
monies may become payable for any purpose (including, without limitation, the
payment of the principal of (and premium, if any) or interest on any Security),
then, anything herein contained to the contrary notwithstanding, the Trustee
shall have full power and authority to receive such monies and to apply the
same to the purpose for which they were received and shall not be affected by
any notice to the contrary which may be received by it within three Business
Days prior to such date.

 

Section 1211.         Reliance on Judicial Order of
Certificate of Liquidating Agent or Other Notices.  Upon any payment or distribution of assets of
the Company referred to in this Article, the Trustee, subject to the provisions
of Article Six, and the Holders of the Securities shall be entitled to
rely upon any order or decree entered by any court of competent jurisdiction in
which such Proceeding is pending, or a certificate of the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee for the benefit
of creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or to the Holders of Securities, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Indebtedness and other indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this
Article.

 

The
Trustee shall be entitled to rely on the delivery to it of a written notice by
a Person representing himself to be a holder of Senior Indebtedness of the
Company (or an agent or representative of such holder or a trustee under any
indenture under which any instruments evidencing any such Senior Indebtedness
of the Company may have been issued) to establish that such notice has been
given by a holder of such Senior Indebtedness or such agent or representative
or trustee on behalf of such holder.  In
the event that the Trustee determines in good faith that further evidence is
required with 

 

68

 

respect to the right of any Person as a holder of
Senior Indebtedness of the Company to participate in any payment or
distribution pursuant to this Article Twelve, the Trustee may request such
Person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Indebtedness of the Company held by such Person, the
extent to which such Person is entitled to participate in such payment or
distribution and any other facts pertinent to the right of such Person under
this Article Twelve, and, if such evidence is not furnished, the Trustee
may defer any payment to such Person pending judicial determination as to the
right of such Person to receive such payment or distribution.

 

Section 1212.         Trustee Not Fiduciary for Holders of
Senior Indebtedness of the Company. 
The Trustee, in its capacity as trustee under this Indenture, shall not
be deemed to owe any fiduciary duty to the holders of Senior Indebtedness of the
Company and shall not be liable to any such holders if it shall in good faith
mistakenly pay over or distribute to Holders of Securities or to the Company or
to any other Person cash, property or securities to which any holders of Senior
Indebtedness of the Company shall be entitled by virtue of this Article or
otherwise.

 

With
respect to the holders of Senior Indebtedness of the Company, the Trustee
undertakes to perform or to observe only such of its covenants or obligations
as are specifically set forth in this Article and no implied covenants or
obligations with respect to holders of such Senior Indebtedness shall be read
into this Indenture against the Trustee.

 

Section 1213.         Rights of Trustee as Holder of
Senior Indebtedness of the Company; Preservation of Trustee’s Rights.  The Trustee or any Authenticating Agent in
its individual capacity shall be entitled to all the rights set forth in this Article with
respect to any Senior Indebtedness of the Company which may at any time be held
by it, to the same extent as any other holder of Senior Indebtedness of the
Company, and nothing in this Indenture shall deprive the Trustee or any
Authenticating Agent of any of its rights as such holder.

 

Nothing
in this Article shall apply to claims of, or payments to, the Trustee
under or pursuant to Section 607.

 

Section 1214.         Article Applicable to Paying
Agents.  In case at any time any
Paying Agent other than the Trustee shall have been appointed by the Company
and be then acting hereunder, the term “Trustee” as used in this Article shall
in such case (unless the context otherwise requires) be construed as extending
to and including such Paying Agent within its meaning as fully for all intents
and purposes as if such Paying Agent were named in this Article in addition
to or in place of the Trustee.

 

Section 1215.         Certain Conversions or Exchanges
Deemed Payment.  For the purposes of
this Article only, (a) the issuance and delivery of junior
securities upon

 

69

 

conversion or exchange of
Securities shall not be deemed to constitute a payment or distribution on
account of the principal of (or premium, if any) or interest on Securities or
on account of the purchase or other acquisition of Securities, and (b) the
payment, issuance or delivery of cash, property or securities (other than
junior securities) upon conversion or exchange of a Security shall be deemed to
constitute payment on account of the principal of such Security.  For the purposes of this Section, the term “junior
securities” means (i) shares of any stock of any class of the
Company and (ii) securities of the Company which are subordinated
in right of payment to all Senior Indebtedness of the Company which may be
outstanding at the time of issuance or delivery of such securities to
substantially the same extent as, or to a greater extent than, the Securities
are so subordinated as provided in this Article.

 

ARTICLE THIRTEEN

 

Subordination
of Subsidiary Guarantee

 

Section 1301.         Subsidiary Guarantee Subordinate to
Senior Indebtedness of the Subsidiary Guarantor.  The Subsidiary Guarantor covenants and
agrees, and each Holder of a Security, by its acceptance thereof, likewise
covenants and agrees, that, to the extent and in the manner hereinafter set
forth in this Article, all payments pursuant to each and any Subsidiary
Guarantee made by or on behalf of the Subsidiary Guarantor are hereby expressly
made subordinate in right of payment to the prior payment in full of all
amounts then due and payable in respect of all Senior Indebtedness of the
Subsidiary Guarantor. Each Holder, by its acceptance hereof, waives all notice
of acceptance of the subordination provisions contained herein by each holder
of Senior Indebtedness of the Subsidiary Guarantor, whether now outstanding or
hereafter incurred and waives reliance by each such holder upon said
provisions.

 

Section 1302.         Payment Over of Proceeds Upon
Dissolution, Etc.  Upon any payment
or distribution of assets to creditors upon any liquidation, dissolution, winding
up, reorganization, assignment for the benefit of creditors, marshaling of
assets or any bankruptcy, insolvency, debt restructuring or similar proceedings
in connection with the Subsidiary Guarantor’s insolvency or bankruptcy (each
such event, if any, herein sometimes referred to as a “Proceeding”), the
holders of Senior Indebtedness of the Subsidiary Guarantor shall be entitled to
receive payment in full of principal of (and premium, if any) and interest, if
any, on such Senior Indebtedness, or provision shall be made for such payment
in cash or cash equivalents or otherwise in a manner satisfactory to the
holders of such Senior Indebtedness, before the Holders of the Securities are
entitled to receive or retain any payment or distribution of any kind or
character, whether in cash, property or securities (including any payment or
distribution which may be payable or deliverable by reason of the payment of
any other Indebtedness of the Subsidiary Guarantor subordinated to the payment
of any Subsidiary Guarantee, such payment or distribution being hereinafter
referred to as a “Junior Subordinated 

 

70

 

Payment”),
on account of any payment pursuant to any Subsidiary Guarantee or on account of
the purchase or other acquisition of Securities by the Subsidiary Guarantor or
any Subsidiary and to that end the holders of Senior Indebtedness of the
Subsidiary Guarantor shall be entitled to receive, for application to the
payment thereof, any payment or distribution of any kind or character, whether
in cash, property or securities, including any Junior Subordinated Payment,
which may be payable or deliverable in respect of the Subsidiary Guarantee in
any such Proceeding.

 

In the
event that, notwithstanding the foregoing provisions of this Section, the
Trustee or the Holder of any Security shall have received any payment or
distribution of assets of the Subsidiary Guarantor of any kind or character,
whether in cash, property or securities, including any Junior Subordinated
Payment, before all Senior Indebtedness of the Subsidiary Guarantor is paid in
full or payment thereof is provided for in cash or cash equivalents or
otherwise in a manner satisfactory to the holders of such Senior Indebtedness,
and if written notice thereof from the Subsidiary Guarantor or any holder of
Senior Indebtedness of the Subsidiary Guarantor (or any trustee, agent or
representative therefor) shall, at least three Business Days prior to the time
of such payment or distribution, have been received by a Responsible Officer of
the Trustee or, as the case may be, such Holder, then and in such event such
payment or distribution shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee,
agent or other Person making payment or distribution of assets of the
Subsidiary Guarantor for application to the payment of all Senior Indebtedness
of the Subsidiary Guarantor remaining unpaid, to the extent necessary to pay
all such Senior Indebtedness in full, after giving effect to any concurrent
payment or distribution to or for the holders of Senior Indebtedness of the
Subsidiary Guarantor.

 

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

 

71

 

case may be, shall, as a part of such consolidation,
merger, or sale comply with any conditions set forth any applicable
supplemental indenture.

 

Section 1303.         Prior Payment to Senior Indebtedness
of the Subsidiary Guarantor Upon Acceleration of Securities.  In the event that any Securities are declared
due and payable before their Stated Maturity, then and in such event the
holders of the Senior Indebtedness of the Subsidiary Guarantor outstanding at
the time such Securities so become due and payable shall be entitled to receive
payment in full of all amounts due on or in respect of such Senior Indebtedness
(including any amounts due upon acceleration), or provision shall be made for
such payment in cash or cash equivalents or otherwise in a manner satisfactory
to the holders of such Senior Indebtedness, before the Holders of the
Securities are entitled to receive any payment or distribution of any kind or
character, whether in cash, properties or securities (including any Junior
Subordinated Payment) by the Subsidiary Guarantor on account of any payment
pursuant to any Subsidiary Guarantee or on account of the purchase or other
acquisition of Securities by the Subsidiary Guarantor or any Subsidiary; provided,
however, that nothing in this Section shall prevent the
satisfaction of any sinking fund payment in accordance with this Indenture or
as otherwise specified as contemplated by Section 301 for the Securities
of any series by delivering and crediting as contemplated by Section 301
for the Securities of any series Securities which have been acquired (upon
redemption or otherwise) prior to such declaration of acceleration.

 

In the
event that, notwithstanding the foregoing, the Subsidiary Guarantor shall make
any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if written notice of such fact from
the Subsidiary Guarantor or any holder of Senior Indebtedness of the Subsidiary
Guarantor (or any Trustee, agent or representative therefor) shall, at least
three Business Days prior to the time of such payment, have been received by a
Responsible Officer of the Trustee or, as the case may be, such Holder, then
and in such event such payment shall be paid over and delivered forthwith to
the Subsidiary Guarantor.

 

The
provisions of this Section shall not apply to any payment with respect to
which Section 1302 would be applicable.

 

Section 1304.         No Payment When Senior Indebtedness
of Subsidiary Guarantor in Default.  (a) In
the event and during the continuation of any default in the payment of
principal of (or premium, if any) or interest on any Senior Indebtedness of the
Subsidiary Guarantor, or in the event that any event of default with respect to
any Senior Indebtedness of the Subsidiary Guarantor shall have occurred and be
continuing and shall have resulted in such Senior Indebtedness becoming or
being declared due and payable prior to the date on which it would otherwise
have become due and payable, unless and until such event of default shall have
been cured or waived or shall have ceased to exist and such acceleration shall
have been rescinded or annulled, or (b) in the event any judicial
proceeding shall be pending with respect to any such default in payment or such

 

72

 

event of default, then no
payment or distribution of any kind or character, whether in cash, properties
or securities (including any Junior Subordinated Payment) shall be made by the
Subsidiary Guarantor on account of any payment pursuant to any Subsidiary
Guarantee or on account of the purchase or other acquisition of Securities by
the Subsidiary Guarantor or any Subsidiary; provided, however,
that nothing in this Section shall prevent the satisfaction of any sinking
fund payment in accordance with this Indenture or as otherwise specified as
contemplated by Section 301 for the Securities of any series by delivering
and crediting pursuant to Section 1302 or as otherwise specified as
contemplated by Section 301 for the Securities of any series Securities
which have been acquired (upon redemption or otherwise) prior to such default
in payment or event of default.

 

In the
event that, notwithstanding the foregoing, the Subsidiary Guarantor shall make
any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if written notice thereof from the
Subsidiary Guarantor or any holder of Senior Indebtedness of the Subsidiary Guarantor
(or any trustee, agent or representative therefor) shall, at least three
Business Days or prior to the time of such payment, have been received by the
Trustee or, as the case may be, such Holder, then and in such event such
payment shall be paid over and delivered forthwith to the Subsidiary Guarantor.

 

The
provisions of this Section shall not apply to any payment with respect to
which Section 1302 would be applicable.

 

Section 1305.         Payment Permitted If No Default.  Nothing contained in this Article or
elsewhere in this Indenture or in any of the Securities or any Subsidiary
Guarantee shall prevent (a) the Subsidiary Guarantor, at any time
except during the pendency of any Proceeding referred to in Section 1302
or under the conditions described in Section 1303 and Section 1304,
from making payments at any time pursuant to any Subsidiary Guarantee, or (b) the
application by the Trustee of any money or Government Obligations deposited
with it hereunder to the payment of or on account of any payment pursuant to
any Subsidiary Guarantee or the retention of such payment by the Holders, if,
at least three Business Days prior to the time of such application by the
Trustee, a Responsible Officer of the Trustee did not receive written notice
from the Subsidiary Guarantor or any holder of Senior Indebtedness of the
Subsidiary Guarantor (or any trustee, agent or representative therefor) that
such payment would have been prohibited by the provisions of this Article.  Notwithstanding anything herein to the
contrary, money or Government Obligations held in trust pursuant to Section 402
shall not be subject to the claims of the holders of Senior Indebtedness of the
Subsidiary Guarantor under this Article Thirteen.

 

Section 1306.         Subrogation to Rights of Holders of
Senior Indebtedness of the Subsidiary Guarantor.  Subject to the payment in full of all Senior
Indebtedness of the Subsidiary Guarantor, or the provision for such payment in
cash or cash equivalents or 

 

73

 

otherwise in a manner
satisfactory to the holders of such Senior Indebtedness, the Holders of the
Securities shall be subrogated to the extent of the payments or distributions
made to the holders of such Senior Indebtedness pursuant to the provisions of
this Article (equally and ratably with the holders of all indebtedness of
the Subsidiary Guarantor which by its express terms is subordinated to Senior
Indebtedness of the Subsidiary Guarantor to substantially the same extent as
the Subsidiary Guarantee is subordinated to such Senior Indebtedness and is
entitled to like rights of subrogation by reason of any payments or
distributions made to holders of such Senior Indebtedness) to the rights of the
holders of such Senior Indebtedness to receive payments and distributions of
cash, property and securities applicable to such Senior Indebtedness until all
payments due pursuant to the Subsidiary Guarantee shall be paid in full.  For purposes of such subrogation or
assignment, no payments or distributions to the holders of the Senior
Indebtedness of the Subsidiary Guarantor of any cash, property or securities to
which the Holders of the Securities or the Trustee would be entitled except for
the provisions of this Article, and no payments over, pursuant to the
provisions of this Article, to the holders of Senior Indebtedness of the
Subsidiary Guarantor by Holders of the Securities or the Trustee, shall, as
among the Subsidiary Guarantor, its creditors other than holders of its Senior
Indebtedness, and the Holders of the Securities, be deemed to be a payment or
distribution by the Subsidiary Guarantor to or on account of its Senior
Indebtedness.

 

Section 1307.         Provisions Solely to Define Relative
Rights.  The provisions of this Article are
and are intended solely for the purpose of defining the relative rights of the
Holders of the Securities on the one hand and the holders of Senior
Indebtedness of the Subsidiary Guarantor on the other hand.  Nothing contained in this Article or
elsewhere in this Indenture or in the Securities or in any Subsidiary Guarantee
is intended to or shall (a) impair, as between the Subsidiary
Guarantor and the Holders of the Securities, the obligations of the Subsidiary
Guarantor, which are absolute and unconditional, to pay to the Holders of the
Securities any payment pursuant to any Subsidiary Guarantee as and when the
same shall become due and payable in accordance with its terms; or (b) affect
the relative rights against the Subsidiary Guarantor of the Holders of the
Securities and creditors of the Subsidiary Guarantor other than their rights in
relation to the holders of Senior Indebtedness of the Subsidiary Guarantor; or (c) prevent
the Trustee or the Holder of any Security from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture or any
Subsidiary Guarantee including, without limitation, filing and voting claims in
any Proceeding, subject to the rights, if any, under this Article of the
holders of Senior Indebtedness of the Subsidiary Guarantor to receive cash,
property and securities otherwise payable or deliverable to the Trustee or such
Holder.

 

Section 1308.         Trustee to Effectuate Subordination.  Each Holder of a Security by his or her
acceptance thereof authorizes and directs the Trustee on his or her behalf to
take such action as may be necessary or appropriate to acknowledge or
effectuate the 

 

74

 

subordination provided in
this Article and appoints the Trustee his or her attorney-in-fact for any
and all such purposes.

 

Section 1309.         No Waiver of Subordination
Provisions.  No right of any present
or future holder of any Senior Indebtedness of the Subsidiary Guarantor to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the
Subsidiary Guarantor or by any act or failure to act, in good faith, by any
such holder, or by any noncompliance by the Subsidiary Guarantor with the
terms, provisions and covenants of this Indenture or any Subsidiary Guarantee,
regardless of any knowledge thereof that any such holder may have or be
otherwise charged with.

 

Section 1310.         Notice to Trustee.  The Subsidiary Guarantor shall give prompt
written notice to the Trustee of any fact known to the Subsidiary Guarantor
which would prohibit the making of any payment to or by the Trustee in respect
of any Subsidiary Guarantee. 
Notwithstanding the provisions of this Article or any other
provision of this Indenture or any Subsidiary Guarantee, the Trustee shall not
be charged with actual knowledge of the existence of any facts which would
prohibit the making of any payment to or by the Trustee in respect of any
Subsidiary Guarantee, unless and until a Responsible Officer of the Trustee
shall have received written notice thereof from the Subsidiary Guarantor or a
holder of Senior Indebtedness of the Subsidiary Guarantor or from any trustee,
agent or representative therefor (whether or not the facts contained in such
notice are true); provided, however, that if the Trustee shall
not have received the notice provided for in this Section at least three
Business Days prior to the date upon which by the terms hereof any monies may
become payable for any purpose (including, without limitation, the payment of the
principal of (and premium, if any) or interest on any Security), then, anything
herein contained to the contrary notwithstanding, the Trustee shall have full
power and authority to receive such monies and to apply the same to the purpose
for which they were received and shall not be affected by any notice to the
contrary which may be received by it within three Business Days prior to such
date.

 

Section 1311.         Reliance on Judicial Order of
Certificate of Liquidating Agent or Other Notices.  Upon any payment or distribution of assets of
the Subsidiary Guarantor referred to in this Article, the Trustee, subject to
the provisions of Article Six, and the Holders of the Securities shall be
entitled to rely upon any order or decree entered by any court of competent
jurisdiction in which such Proceeding is pending, or a certificate of the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders of Securities, for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Indebtedness and other indebtedness of
the Subsidiary Guarantor, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent thereto or to
this Article.

 

75

 

The
Trustee shall be entitled to rely on the delivery to it of a written notice by
a Person representing himself to be a holder of Senior Indebtedness of the
Subsidiary Guarantor (or an agent or representative of such holder or a trustee
under any indenture under which any instruments evidencing any such Senior
Indebtedness may have been issued) to establish that such notice has been given
by a holder of such Senior Indebtedness or such agent or representative or
trustee on behalf of such holder.  In the
event that the Trustee determines in good faith that further evidence is required
with respect to the right of any Person as a holder of Senior Indebtedness of
the Subsidiary Guarantor to participate in any payment or distribution pursuant
to this Article Thirteen, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Senior Indebtedness of the Subsidiary Guarantor held by such Person, the extent
to which such Person is entitled to participate in such payment or distribution
and any other facts pertinent to the right of such Person under this Article Thirteen,
and, if such evidence is not furnished, the Trustee may defer any payment to
such Person pending judicial determination as to the right of such Person to
receive such payment or distribution.

 

Section 1312.         Trustee Not Fiduciary for Holders of
Senior Indebtedness of the Subsidiary Guarantor.  The Trustee, in its capacity as trustee under
this Indenture, shall not be deemed to owe any fiduciary duty to the holders of
Senior Indebtedness of the Subsidiary Guarantor and shall not be liable to any
such holders if it shall in good faith mistakenly pay over or distribute to
Holders of Securities or to the Subsidiary Guarantor or to any other Person
cash, property or securities to which any holders of Senior Indebtedness of the
Subsidiary Guarantor shall be entitled by virtue of this Article or
otherwise.

 

With
respect to the holders of Senior Indebtedness of the Subsidiary Guarantor, the
Trustee undertakes to perform or to observe only such of its covenants or
obligations as are specifically set forth in this Article and no implied
covenants or obligations with respect to holders of such Senior Indebtedness
shall be read into this Indenture against the Trustee.

 

Section 1313.         Rights of Trustee as Holder of
Senior Indebtedness of the Subsidiary Guarantor; Preservation of Trustee’s
Rights.  The Trustee or any
Authenticating Agent in its individual capacity shall be entitled to all the
rights set forth in this Article with respect to any Senior Indebtedness
of the Subsidiary Guarantor which may at any time be held by it, to the same
extent as any other holder of such Senior Indebtedness, and nothing in this
Indenture shall deprive the Trustee or any Authenticating Agent of any of its
rights as such holder.

 

Nothing
in this Article shall apply to claims of, or payments to, the Trustee
under or pursuant to Section 607.

 

76

 

Section 1314.         Article Applicable to Paying
Agents.  In case at any time any
Paying Agent other than the Trustee shall have been appointed by the Company
and be then acting hereunder, the term “Trustee” as used in this Article shall
in such case (unless the context otherwise requires) be construed as extending
to and including such Paying Agent within its meaning as fully for all intents
and purposes as if such Paying Agent were named in this Article in
addition to or in place of the Trustee.

 

Section 1315.         Certain Conversions or Exchanges
Deemed Payment.  For the purposes of
this Article only, (a) the issuance and delivery of junior
securities upon conversion or exchange of Securities shall not be deemed to
constitute a payment or distribution on account of the principal of (or
premium, if any) or interest on Securities or on account of the purchase or
other acquisition of Securities, and (b) the payment, issuance or
delivery of cash, property or securities (other than junior securities) upon
conversion or exchange of a Security shall be deemed to constitute payment on
account of the principal of such Security. 
For the purposes of this Section, the term “junior securities” means (i) shares
of any stock of any class of the Company and (ii) securities of the
Company which are subordinated in right of payment to all Senior Indebtedness
which may be outstanding at the time of issuance or delivery of such securities
to substantially the same extent as, or to a greater extent than, the
Securities are so subordinated as provided in this Article.

 

ARTICLE FOURTEEN

 

Defeasance
and Covenant Defeasance

 

Section 1401.         Company’s Option to Effect
Defeasance or Covenant Defeasance. 
The Company may elect, at its option at any time, to have Section 1402
or Section 1403 applied to any Securities upon compliance with the
conditions set forth below in this Article. 
Any such election shall be evidenced by a Board Resolution.

 

Section 1402.         Defeasance and Discharge.  Upon the Company’s exercise of its option (if
any) to have this Section applied to any Securities, the Company shall be
deemed to have been discharged from its obligations with respect to such
Securities as provided in this Section on and after the date the
conditions set forth in Section 1404 are satisfied (hereinafter called “Defeasance”).  For this purpose, such Defeasance means that
the Company shall be deemed to have paid and discharged the entire indebtedness
represented by such Securities and to have satisfied all its other obligations
under such Securities and this Indenture insofar as such Securities are
concerned (and the Trustee, at the expense of the Company and upon Company
Request, shall execute proper instruments acknowledging the same), subject to
the following, which shall survive until otherwise terminated or discharged
hereunder: (1) the Company’s obligations with respect to such
Securities under Sections 304, 305, 306, 1002 and 1003; (2) the
rights, powers, trusts, duties and immunities of the Trustee hereunder,
including but not limited to those enumerated under Sections 601, 603 and
607; and (3) this Article. 
Subject to 

 

77

 

compliance with this
Article, the Company may exercise its option (if any) to have this Section applied
to any Securities notwithstanding the prior exercise of its option (if any) to
have Section 1403 applied to such Securities.

 

Section 1403.         Covenant Defeasance.  Upon the Company’s exercise of its option (if
any) to have this Section applied to any Securities (1) the
Company shall be released from its obligations under Section 801, Sections
1006 and 1007, and any covenants provided pursuant to 901(5) for the
benefit of the Holders of such Securities; and (2) the occurrence
of any event specified in Sections 501(3) (with respect to any of Section 801,
Sections 1006 and 1007, and any such covenants provided pursuant to Section 901(5))
shall be deemed not to be or result in an Event of Default, in each case with
respect to such Securities as provided in this Section on and after the
date the conditions set forth in Section 1405 are satisfied (hereinafter
called “Covenant Defeasance”). 
For this purpose, such Covenant Defeasance means that, with respect to
such Securities, the Company may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
specified Section (to the extent so specified in the case of Section 501(3)),
whether directly or indirectly by reason of any reference elsewhere herein to
any such Section or by reason of any reference in any such Section to
any other provision herein or in any other document, but the remainder of this
Indenture and such Securities shall be unaffected thereby.

 

Notwithstanding
any Covenant Defeasance with respect to Section 801, any Person that would
otherwise have been required to assume the obligations of the Company pursuant
to said Section shall be required, as a condition to any merger,
consolidation, conveyance, transfer or lease contemplated thereby, to assume
the obligations of the Company to the Trustee under Sections 607 and 1205.

 

Section 1404.         Conditions to Defeasance or Covenant
Defeasance.  The following shall be
the conditions to the application of Section 1402 or Section 1403 to
any Securities:

 

(1)           The Company shall irrevocably have
deposited or caused to be deposited with the Trustee (or another trustee which
satisfies the requirements contemplated by Section 609 and agrees to
comply with the provisions of this Article applicable to it) as trust
funds in trust for the purpose of making the following payments, specifically
pledged as security for, and dedicated solely to, the benefits of the Holders
of such Securities, (A) money, or (B) Government
Obligations which through the scheduled payment of principal and interest in
respect thereof in accordance with their terms will provide, not later than one
day before the due date of any payment, money, or (C) a combination
thereof, in each case in an amount sufficient to pay and discharge, and which
shall be applied by the Trustee (or any such other qualifying trustee) to pay
and discharge, the principal of and any premium and interest on such Securities
due on or before the respective Stated Maturities or on the Redemption Date, in
accordance with the 

 

78

 

terms of this Indenture
and such Securities; provided, that the Trustee shall have the right
(but not the obligation) to require the Company to deliver to the Trustee an
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification, or other evidence satisfactory to the
Trustee, as to the sufficiency of deposits made by the Company pursuant to this
Section.

 

(2)           In the event of an election to have Section 1402
apply to any Securities, the Company shall have delivered to the Trustee an
Opinion of Counsel stating that (A) the Company has received from,
or there has been published by, the Internal Revenue Service a ruling or (B) since
the date of this instrument, there has been a change in the applicable Federal
income tax law, in the case of either (A) or (B) to the effect that,
and based thereon such opinion shall confirm that, the Holders of such
Securities will not recognize gain or loss for Federal income tax purposes as a
result of the deposit, Defeasance and discharge to be effected with respect to
such Securities and will be subject to Federal income tax on the same amount,
in the same manner and at the same times as would be the case if such deposit,
Defeasance and discharge were not to occur.

 

(3)           In the event of an election to have Section 1403
apply to any Securities, the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that the Holders of such Securities will not
recognize gain or loss for Federal income tax purposes as a result of the
deposit and Covenant Defeasance to be effected with respect to such Securities
and will be subject to Federal income tax on the same amount, in the same
manner and at the same times as would be the case if such deposit and Covenant
Defeasance were not to occur.

 

(4)           No event which is, or after notice or
lapse of time or both would become, an Event of Default with respect to such
Securities or any other Securities shall have occurred and be continuing at the
time of such deposit or, with regard to any such event specified in Sections
501(4) and (5), at any time on or prior to the 90th day after
the date of such deposit (it being understood that this condition shall not be
deemed satisfied until after such 90th day).

 

(5)           Such Defeasance or Covenant
Defeasance shall not result in a breach or violation of, or constitute a
default under, any indenture or other agreement or instrument for borrowed
money to which the Company is a party or by which it is bound.

 

(6)           Such Defeasance or Covenant
Defeasance shall not result in the trust arising from such deposit constituting
an investment company within the meaning of the Investment Company Act unless
such trust shall be registered under the Investment Company Act or exempt from
registration thereunder.

 

79

 

(7)           If such Securities are to be redeemed
prior to Stated Maturity (other than from mandatory sinking fund payments or
analogous payments), notice of such redemption shall have been duly given
pursuant to this Indenture or provision therefor satisfactory to the Trustee
shall have been made.

 

(8)           The Company shall have delivered to
the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating
that all conditions precedent with respect to such Defeasance or Covenant
Defeasance have been complied with.

 

Section 1405.         Deposited Money and Government
Obligations to Be Held in Trust; Miscellaneous Provisions.  Subject to the provisions of the last
paragraph of Section 1003, all money and Government Obligations (including
the proceeds thereof and the interest thereon) deposited with the Trustee or
other qualifying trustee (solely for purposes of this Section and Section 1406,
the Trustee and any such other trustee are referred to collectively as the “Trustee”)
pursuant to Section 1404 in respect of any Securities shall be held in
trust and applied by the Trustee, in accordance with the provisions of such
Securities and this Indenture, to the payment, either directly or through any
such Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Holders of such Securities, of all sums due and
to become due thereon in respect of principal and any premium and interest, but
money so held in trust need not be segregated from other funds except to the
extent required by law.

 

The
Company shall pay and indemnify the Trustee against any tax, fee or other
charge imposed on or assessed against the Government Obligations deposited
pursuant to Section 1404 or the principal and interest received in respect
thereof other than any such tax, fee or other charge which by law is for the
account of the Holders of Outstanding Securities.

 

Anything
in this Article to the contrary notwithstanding, the Trustee shall deliver
or pay to the Company from time to time upon Company Request any money or
Government Obligations held by it as provided in Section 1404 with respect
to any Securities which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee or in the opinion of such other Persons delivered to
the Trustee as shall be reasonably satisfactory to the Trustee (which may be
the same opinion delivered to the Trustee under Section 1404(1)), are in
excess of the amount thereof which would then be required to be deposited to
effect the Defeasance or Covenant Defeasance, as the case may be, with respect
to such Securities.

 

Section 1406.         Reinstatement.  If the Trustee or the Paying Agent is unable
to apply any money in accordance with this Article with respect to any
Securities by reason of any order or judgment of any court or Governmental
Authority enjoining, restraining or otherwise prohibiting such application,
then the obligations under this Indenture and 

 

80

 

such Securities from
which the Company has been discharged or released pursuant to Section 1402
or 1403 shall be revived and reinstated as though no deposit had occurred
pursuant to this Article with respect to such Securities, until such time
as the Trustee or Paying Agent is permitted to apply all money held in trust
pursuant to Section 1405 with respect to such Securities in accordance
with this Article; provided, however, that if the Company makes
any payment of principal of or any premium or interest on any such Security following
such reinstatement of its obligations, the Company shall be subrogated to the
rights (if any) of the Holders of such Securities to receive such payment from
the money so held in trust.

 

Section 1407.         Qualifying Trustee.  Any trustee appointed pursuant to Section 1404
for the purpose of holding trust funds deposited pursuant to that Section shall
be appointed under an agreement in form acceptable to the Trustee and shall
provide to the Trustee a certificate of such trustee, upon which certificate the
Trustee shall be entitled to conclusively rely, that all conditions precedent
provided for herein to the related Defeasance or Covenant Defeasance have been
complied with.  In no event shall the
Trustee be liable for any acts or omissions of said trustee.

 

* * *

 

81

 

This
instrument may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.

 

IN
WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed as of the day and year first above written.

 

 

	
   

  	
  PRINCIPAL FINANCIAL GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PRINCIPAL FINANCIAL SERVICES,

  
	
   

  	
  INC., as guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE BANK OF NEW YORK TRUST

  
	
   

  	
  COMPANY, N.A.,

  
	
   

  	
  as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

82

 

EXHIBIT A

 

[SPECIMEN BOND]

 

(FORM OF FACE
OF SECURITY)

 

[If
the Security is an Original Issue Discount Security, insert — For purposes of Section 1271
of the United States Internal Revenue Code of 1986, as amended, the issue price
of this security is      % of its principal amount and the
Issue Date is
                            .]

 

PRINCIPAL
FINANCIAL GROUP, INC. 

[Title of Security]

 

CUSIP:                           

 

	
  No.         

  	
  $                   

  

 

PRINCIPAL
FINANCIAL GROUP, INC., a corporation organized and existing under the laws of
Delaware (hereinafter called the “Company”, which term includes any
successor corporation under the Indenture hereinafter referred to), for value
received, hereby promises to pay to [Insert if Global Security — Cede &
Co.], or registered assigns, the principal sum of
                      
Dollars on                           
[If the Security is to bear interest prior to Maturity, insert — , and to pay
interest thereon from
                          
or from the most recent Interest Payment Date to which interest has been paid
or duly provided for, semi-annually on
                    
and                     
in each year, commencing
                    ,
at the rate of      % per annum, on the basis of a 360-day
year consisting of twelve 30-day months, until the principal hereof is paid or
duly provided for or made available for payment] [(If applicable insert — , and
(to the extent that the payment of such interest shall be legally enforceable)
at the rate of     % per annum on any overdue principal and
premium and on any overdue installment of interest)].

 

[If
the Security is to bear interest prior to Maturity, insert — 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
Security (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest, which shall be the date
which is fifteen days (whether or not a Business Day) next preceding such
Interest Payment Date.  Any such interest
not so punctually paid or duly provided for will forthwith cease to be payable
to the Holder on such Regular Record Date and may either be paid to the person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities of this series not less than 10 days prior to
such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the 

 

A-1

 

Securities of this series may be listed, and upon such
notice as may be required by such exchange, all as more fully provided in said
Indenture.]

 

[If
the Security is not to bear interest prior to Maturity, insert — The principal
of this Security shall not bear interest except in the case of a default in
payment of principal upon acceleration, upon redemption or at Stated Maturity
and in such case the overdue principal of this Security shall bear interest at
the rate of       % per annum (to the extent that
the payment of such interest shall be legally enforceable), which shall accrue
from the date of such default in payment to the date payment of such principal
has been made or duly provided for. 
Interest on any overdue principal shall be payable on demand.  Any such interest on any overdue principal
that is not so paid on demand shall bear interest at the rate of
    % per annum (to the extent that the payment of such
interest shall be legally enforceable), which shall accrue from the date of
such demand for payment to the date payment of such interest has been made or
duly provided for, and such interest shall also be payable on demand.]

 

The
indebtedness evidenced by this Security is, to the extent provided in the
Indenture, subordinate and subject in right of payments to the prior payment in
full of all Senior Indebtedness, and this Security is issued subject to the
provisions of the Indenture with respect thereto.  Each Holder of this Security by accepting the
same, (a) agrees to and shall be bound by such provisions, (b) authorizes
and directs the Trustee on its behalf to take such actions as may be necessary
or appropriate to effectuate the subordination so provided and (c) appoints
the Trustee its attorney-in-fact for any and all such purposes.  Each Holder hereof, by its acceptance hereof,
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such holder upon
said provisions.

 

Payment
of the principal of (and premium, if any) and [if applicable, insert — any
interest] on this Security will be made at the office or agency of the Company
maintained for that purpose in The City of New York, 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 [if applicable, insert —; provided, however,
that at the option of the Company payment of interest may be made by check mailed
to the address of the Person entitled thereto as such address shall appear in
the Security Register].

 

Reference
is hereby made to the further provisions of this Security set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.

 

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

 

A-2

 

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

 

 

	
   

  	
  PRINCIPAL FINANCIAL GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

CERTIFICATE OF
AUTHENTICATION

 

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

 

 

	
   

  	
  THE BANK OF NEW YORK TRUST

  
	
   

  	
  COMPANY, N.A.,

  
	
   

  	
  as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated:

  	
   

  

 

A-3

 

FORM OF
REVERSE OF SECURITY

 

This
Security is one of a duly authorized issue of securities of the Company
designated as its
                    
due 20     (herein called the “Securities”), issued
and to be issued in one or more series under a Subordinated Indenture, dated as
of
                  
as supplemented and amended from time to time by
                              
(herein called the “Indenture”), between the Company, Principal
Financial Services, Inc., as guarantor (herein called the “Subsidiary
Guarantor”) and The Bank of New York Trust Company, N.A., as Trustee
(herein called the “Trustee”, which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Subsidiary Guarantor, the Trustee and the Holders of the Securities and of the
terms upon which the Securities are, and are to be, authenticated and
delivered.  This Security is one of the
series designated on the face hereof [if applicable insert — limited in
aggregate principal amount to
$                      ].

 

All
terms used in this Security that are defined in the Indenture shall have the
meaning assigned to them in the Indenture.

 

[If
applicable, insert — The Securities of this series are subject to redemption
upon not less than 30 nor more than 60 days’ notice by mail at any time [on or
after
                                  ],
as a whole or in part, at the election of the Company.  The Redemption Price for any Security so
redeemed shall be equal to 100% of the principal amount of such Securities then
Outstanding plus accrued and unpaid interest up to but not including the date
fixed for redemption.  In the event of
redemption of this Security in part only, a new Security or Securities of this
series for the unredeemed portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.]

 

[Installments
of accrued and unpaid interest whose Stated Maturity is on or prior to the
Redemption Date will be payable to the Holders of the Securities of this
series, or one or more Predecessor Securities, registered as such at the close
of business on the relevant Regular Record Dates according to their terms.]

 

The
Indenture contains provisions for satisfaction, discharge and defeasance of the
entire indebtedness on this security, upon compliance by the Company with
certain conditions set forth therein.

 

[If
the Security is not an Original Issue Discount Security, — If an Event of
Default with respect to Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due
and payable in the manner and with the effect provided in the Indenture.] [If
the security is an Original Issue Discount Security, — If an Event of Default
with respect to Securities of this series shall occur and be continuing, an
amount of principal of the Securities of this series may be 

 

A-4

 

declared due and payable in the manner and with the
effect provided in the Indenture.  Such
amount shall be equal to — insert formula for determining the amount.

 

Upon
payment of the amount of principal so declared due and payable [if applicable
insert— and of interest on any overdue principal and overdue interest (in each
case to the extent that the payment of such interest shall be legally
enforceable)], all of the Company’s obligations in respect of the payment of
the principal of and interest, if any, on the Securities of this series shall
terminate.]

 

[If
the securities of this series are not guaranteed by the Subsidiary Guarantor,
insert — The Subsidiary Guarantor shall not guarantee the obligations of the
Company under this Security.] [If the securities of this series are guaranteed
by the Subsidiary Guarantor, insert — The Subsidiary Guarantor shall guarantee
the obligations of the Company under this Security, subject to the terms,
conditions and limitations provided in the Indenture.]

 

The
Indenture permits, with certain exceptions as therein provided, the amendment
thereof and the modification of the rights and obligations of the Company and
the rights of the Holders of the Securities of each series to be affected under
the Indenture at any time by the Company and the Trustee with the consent of
the Holders of a majority in principal amount of the Securities at the time
Outstanding of each series to be affected. 
The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of such
series, to waive compliance by the Company with certain provisions of the Indenture
and certain past defaults under the Indenture and their consequences.  Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.

 

No
reference herein to the Indenture and no provision of this Security or of the
Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.

 

As
provided in the Indenture and subject to certain limitations therein set forth,
the transfer of this Security is registrable in the Security Register, upon
surrender of this Security for registration of transfer at the office or agency
of the Company in any place where the principal of (and premium, if any) and
interest on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this 

 

A-5

 

series, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.

 

The
Securities of this series are issuable only in registered form without coupons
in denominations of
$             and
any integral multiple thereof.  As provided
in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal
amount of Securities of this series of a different authorized denomination, as
requested by the Holder surrendering the same.

 

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

 

The
Company, the Trustee and any agent of the Company or the Trustee may treat the Person
in whose name this Security is registered as the owner hereof for all purposes,
whether or not this Security be overdue, and neither the Company, the Trustee
nor any such agent shall be affected by notice to the contrary.

 

THIS
SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.

 

EACH
OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THE INDENTURE, THIS SECURITY OR THE
TRANSACTION CONTEMPLATED HEREBY.

 

A-6Exhibit 4.07

 

PRINCIPAL
FINANCIAL GROUP, INC.

 

and

 

PRINCIPAL
FINANCIAL SERVICES, INC.,

 

as guarantor

 

to

 

WILMINGTON TRUST
COMPANY,

 

as Trustee

 

 

JUNIOR
SUBORDINATED INDENTURE

 

Dated as of         

 

	
   

  
	
   

  	
  Table of
  Contents

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
   

  	
  Article One

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Definitions and other Provisions of General
  Application

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 101.

  	
  Definitions

  	
  1

  
	
  Section 102.

  	
  Compliance Certificate and Opinions

  	
  10

  
	
  Section 103.

  	
  Forms of Documents Delivered to
  Trustee

  	
  11

  
	
  Section 104.

  	
  Acts of Holders

  	
  12

  
	
  Section 105.

  	
  Notices, Etc. to Trustee, Company
  and Subsidiary Guarantor

  	
  13

  
	
  Section 106.

  	
  Notice to Holders; Waiver

  	
  13

  
	
  Section 107.

  	
  Conflict With Trust Indenture Act

  	
  14

  
	
  Section 108.

  	
  Effect of Headings and Table of
  Contents

  	
  14

  
	
  Section 109.

  	
  Successors and Assigns

  	
  14

  
	
  Section 110.

  	
  Separability Clause

  	
  14

  
	
  Section 111.

  	
  Benefits of Indenture

  	
  14

  
	
  Section 112.

  	
  Governing Law

  	
  14

  
	
  Section 113.

  	
  Non-Business Days

  	
  14

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Two

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Security Forms

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 201.

  	
  Forms Generally

  	
  14

  
	
  Section 202.

  	
  Form of Face of Security

  	
  15

  
	
  Section 203.

  	
  Form of Reverse of Security

  	
  19

  
	
  Section 204.

  	
  Additional Provisions Required in
  Global Security

  	
  21

  
	
  Section 205.

  	
  Form of Trustee’s Certificate
  of Authentication

  	
  22

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Three

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  The Securities

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 301.

  	
  Title and Terms

  	
  22

  
	
  Section 302.

  	
  Denominations

  	
  25

  
	
  Section 303.

  	
  Execution, Authentication, Delivery
  and Dating

  	
  25

  
	
  Section 304.

  	
  Temporary Securities

  	
  27

  
	
  Section 305.

  	
  Registration, Transfer and Exchange

  	
  27

  
	
  Section 306.

  	
  Mutilated, Destroyed, Lost and
  Stolen Securities

  	
  29

  
	
  Section 307.

  	
  Payment of Interest; Interest
  Rights Preserved

  	
  30

  
	
  Section 308.

  	
  Persons Deemed Owners

  	
  31

  

 

i

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 309.

  	
  Cancellation

  	
  31

  
	
  Section 310.

  	
  Computation of Interest

  	
  32

  
	
  Section 311.

  	
  Deferrals of Interest Payments

  	
  32

  
	
  Section 312.

  	
  Right of Set-Off

  	
  33

  
	
  Section 313.

  	
  Agreed Tax Treatment

  	
  33

  
	
  Section 314.

  	
  Extension of Stated Maturity;
  Adjustment of Stated Maturity Upon an Exchange

  	
  33

  
	
  Section 315.

  	
  CUSIP Numbers

  	
  34

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Four

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Satisfaction and Discharge

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 401.

  	
  Satisfaction and Discharge of
  Indenture

  	
  34

  
	
  Section 402.

  	
  Application of Trust Money

  	
  35

  
	
  Section 403.

  	
  Satisfaction, Discharge and
  Defeasance of Securities of Any Series

  	
  35

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Five

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Remedies

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 501.

  	
  Events of Default

  	
  37

  
	
  Section 502.

  	
  Acceleration of Maturity;
  Rescission and Annulment

  	
  38

  
	
  Section 503.

  	
  Collection of Indebtedness and
  Suits for Enforcement by Trustee

  	
  40

  
	
  Section 504.

  	
  Trustee May File Proofs of
  Claim

  	
  40

  
	
  Section 505.

  	
  Trustee May Enforce Claim
  Without Possession of Securities

  	
  41

  
	
  Section 506.

  	
  Application of Money Collected

  	
  41

  
	
  Section 507.

  	
  Limitation
  on Suits

  	
  42

  
	
  Section 508.

  	
  Unconditional Right of Holders to
  Receive Principal, Premium and Interest

  	
  43

  
	
  Section 509.

  	
  Restoration of Rights and Remedies

  	
  43

  
	
  Section 510.

  	
  Rights and Remedies Cumulative

  	
  43

  
	
  Section 511.

  	
  Delay or Omission Not Waiver

  	
  43

  
	
  Section 512.

  	
  Control by Holders

  	
  44

  
	
  Section 513.

  	
  Waiver of Past Defaults

  	
  44

  
	
  Section 514.

  	
  Undertaking for Costs

  	
  45

  
	
  Section 515.

  	
  Waiver of Stay or Extension Laws

  	
  45

  

 

ii

	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Six

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  The Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 601.

  	
  Certain Duties and Responsibilities

  	
  46

  
	
  Section 602.

  	
  Notice of Defaults

  	
  47

  
	
  Section 603.

  	
  Certain Rights of Trustee

  	
  47

  
	
  Section 604.

  	
  Not Responsible for Recitals or
  Issuance of Securities

  	
  48

  
	
  Section 605.

  	
  May Hold Securities

  	
  48

  
	
  Section 606.

  	
  Money Held in Trust

  	
  49

  
	
  Section 607.

  	
  Compensation and Reimbursement

  	
  49

  
	
  Section 608.

  	
  Disqualification; Conflicting
  Interests

  	
  50

  
	
  Section 609.

  	
  Corporate Trustee Required;
  Eligibility

  	
  50

  
	
  Section 610.

  	
  Resignation and Removal;
  Appointment of Successor

  	
  51

  
	
  Section 611.

  	
  Acceptance of Appointment by
  Successor

  	
  52

  
	
  Section 612.

  	
  Merger, Conversion, Consolidation
  or Succession to Business

  	
  53

  
	
  Section 613.

  	
  Preferential Collection of Claims
  Against Company

  	
  53

  
	
  Section 614.

  	
  Appointment of Authenticating Agent

  	
  54

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Seven

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Holders’ Lists and Reports by Trustee and Company

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 701.

  	
  Company to Furnish Trustee Names
  and Addresses of Holders

  	
  55

  
	
  Section 702.

  	
  Preservation of Information,
  Communications to Holders

  	
  56

  
	
  Section 703.

  	
  Reports by Trustee

  	
  56

  
	
  Section 704.

  	
  Reports by Company

  	
  56

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Eight

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Consolidation, Merger, Conveyance, Transfer or Lease

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 801.

  	
  Company May Consolidate, Etc.,
  Only on Certain Terms

  	
  57

  
	
  Section 802.

  	
  Successor Corporation Substituted

  	
  58

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Nine

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Supplemental Indentures

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 901.

  	
  Supplemental Indentures Without
  Consent of Holders

  	
  59

  
	
  Section 902.

  	
  Supplemental Indentures With
  Consent of Holders

  	
  60

  
	
  Section 903.

  	
  Execution of Supplemental
  Indentures

  	
  62

  
	
  Section 904.

  	
  Effect of Supplemental Indentures

  	
  62

  
	
  Section 905.

  	
  Conformity with Trust Indenture Act

  	
  62

  

 

iii

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 906.

  	
  Reference in Securities to
  Supplemental Indentures

  	
  62

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Ten

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Covenants

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 1001.

  	
  Payment of Principal, Premium and
  Interest

  	
  63

  
	
  Section 1002.

  	
  Maintenance of Office or Agency

  	
  63

  
	
  Section 1003.

  	
  Money for Security Payments to be
  Held in Trust

  	
  63

  
	
  Section 1004.

  	
  Payment of Taxes and Other Claims

  	
  65

  
	
  Section 1005.

  	
  Statement as to Compliance

  	
  65

  
	
  Section 1006.

  	
  Waiver of Certain Covenants

  	
  65

  
	
  Section 1007.

  	
  Additional Sums

  	
  65

  
	
  Section 1008.

  	
  Additional Covenants

  	
  66

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Eleven

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Redemption of Securities

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 1101.

  	
  Applicability of This Article

  	
  67

  
	
  Section 1102.

  	
  Election to Redeem; Notice to
  Trustee

  	
  67

  
	
  Section 1103.

  	
  Selection of Securities to be
  Redeemed

  	
  67

  
	
  Section 1104.

  	
  Notice of Redemption

  	
  68

  
	
  Section 1105.

  	
  Deposit of Redemption Price

  	
  69

  
	
  Section 1106.

  	
  Payment of Securities Called for
  Redemption

  	
  69

  
	
  Section 1107.

  	
  Company’s Right of Redemption

  	
  69

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Twelve

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Subordination of Securities

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 1201.

  	
  Securities Subordinate to Senior
  Indebtedness of the Company

  	
  72

  
	
  Section 1202.

  	
  Payment Over of Proceeds Upon
  Dissolution, Etc

  	
  72

  
	
  Section 1203.

  	
  Prior Payment to Senior
  Indebtedness of the Company Upon Acceleration of Securities

  	
  73

  
	
  Section 1204.

  	
  No Payment When Senior Indebtedness
  of the Company in Default

  	
  74

  
	
  Section 1205.

  	
  Payment Permitted If No Default

  	
  75

  
	
  Section 1206.

  	
  Subrogation to Rights of Holders of
  Senior Indebtedness of the Company

  	
  75

  
	
  Section 1207.

  	
  Provisions Solely to Define
  Relative Rights

  	
  76

  
	
  Section 1208.

  	
  Trustee to Effectuate Subordination

  	
  76

  
	
  Section 1209.

  	
  No Waiver of Subordination
  Provisions

  	
  76

  
	
  Section 1210.

  	
  Notice to Trustee

  	
  76

  

 

iv

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 1211.

  	
  Reliance on Judicial Order or
  Certificate of Liquidating Agent or other Notices

  	
  77

  
	
  Section 1212.

  	
  Trustee Not Fiduciary for Holders
  of Senior Indebtedness of the Company

  	
  78

  
	
  Section 1213.

  	
  Rights of Trustee as Holder of
  Senior Indebtedness of the Company; Preservation of Trustee’s Rights

  	
  78

  
	
  Section 1214.

  	
  Article Applicable to Paying
  Agents

  	
  78

  
	
  Section 1215.

  	
  Certain Conversions or Exchanges
  Deemed Payment

  	
  78

  
	
   

  	
   

  	
   

  
	
   

  	
  Article Thirteen

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Subordination of Subsidiary Guarantee

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 1301.

  	
  Subsidiary Guarantee Subordinate to
  Senior Indebtedness of the Subsidiary Guarantor

  	
  79

  
	
  Section 1302.

  	
  Payment Over of Proceeds Upon
  Dissolution, Etc

  	
  79

  
	
  Section 1303.

  	
  Prior Payment to Senior
  Indebtedness of the Subsidiary Guarantor Upon Acceleration of Securities

  	
  80

  
	
  Section 1304.

  	
  No Payment When Senior Indebtedness
  of Subsidiary Guarantor in Default

  	
  81

  
	
  Section 1305.

  	
  Payment Permitted If No Default

  	
  82

  
	
  Section 1306.

  	
  Subrogation to Rights of Holders of
  Senior Indebtedness of the Subsidiary Guarantor

  	
  82

  
	
  Section 1307.

  	
  Provisions Solely to Define
  Relative Rights

  	
  83

  
	
  Section 1308.

  	
  Trustee to Effectuate Subordination

  	
  83

  
	
  Section 1309.

  	
  No Waiver of Subordination
  Provisions

  	
  83

  
	
  Section 1310.

  	
  Notice to Trustee

  	
  84

  
	
  Section 1311.

  	
  Reliance on Judicial Order or
  Certificate of Liquidating Agent or Other Notices

  	
  84

  
	
  Section 1312.

  	
  Trustee Not Fiduciary for Holders
  of Senior Indebtedness of the Subsidiary Guarantor

  	
  85

  
	
  Section 1313.

  	
  Rights of Trustee as Holder of
  Senior Indebtedness of the Subsidiary Guarantor; Preservation of Trustee’s
  Rights

  	
  85

  
	
  Section 1314.

  	
  Article Applicable to Paying
  Agents

  	
  85

  
	
  Section 1315.

  	
  Certain Conversions or Exchanges
  Deemed Payment

  	
  85

  
	
   

  	
   

  	
   

  
	
  Annex
  A — Form of Trust Agreement

  	
   

  
	
   

  	
   

  
	
  Annex
  B — Form of Amended and Restated Trust Agreement

  	
   

  
	
   

  	
   

  
	
  Annex
  C — Form of Guarantee Agreement

  	
   

  

 

v

 

PRINCIPAL
FINANCIAL GROUP, INC.

 

Reconciliation
and tie between the Trust Indenture Act of 1939 (including cross-references to
provisions of Sections 310 to and including 317 which, pursuant to Section 318(c) of
the Trust Indenture Act of 1939, as amended by the Trust Reform Act of 1990,
are a part of and govern the Indenture whether or not physically contained
therein) and the Indenture.

 

	
  TRUST INDENTURE ACT SECTION

  	
   

  	
  INDENTURE SECTION

  
	
   

  	
   

  	
   

  
	
  Section 310(a)(1)

  	
   

  	
  609

  
	
  (a)(2)

  	
   

  	
  609

  
	
  (a)(3)

  	
   

  	
  Not Applicable

  
	
  (a)(4)

  	
   

  	
  Not Applicable

  
	
  (a)(5)

  	
   

  	
  609

  
	
  (b)

  	
   

  	
  608, 610

  
	
  (c)

  	
   

  	
  Not Applicable

  
	
   

  	
   

  	
   

  
	
  Section 311(a)

  	
   

  	
  613

  
	
  (b).

  	
   

  	
  613

  
	
  (b)(2)

  	
   

  	
  703(a)

  
	
   

  	
   

  	
   

  
	
  Section 312(a)

  	
   

  	
  701, 702(a)

  
	
  (b)

  	
   

  	
  702(b)

  
	
  (c)

  	
   

  	
  702(c)

  
	
   

  	
   

  	
   

  
	
  Section 313(a)

  	
   

  	
  703(a)

  
	
  (b)

  	
   

  	
  703(b)

  
	
  (c)

  	
   

  	
  703(a), 703(b)

  
	
  (d)

  	
   

  	
  703(c)

  
	
   

  	
   

  	
   

  
	
  Section 314(a)(1)

  	
   

  	
  704

  
	
  (a)(2)

  	
   

  	
  704

  
	
  (a)(3)

  	
   

  	
  704

  
	
  (a)(4)

  	
   

  	
  1006

  
	
  (b)

  	
   

  	
  Not Applicable

  
	
  (c)(1)

  	
   

  	
  102

  
	
  (c)(2)

  	
   

  	
  102

  
	
  (c)(3)

  	
   

  	
  Not Applicable

  
	
  (d)

  	
   

  	
  Not Applicable

  
	
  (e)

  	
   

  	
  102

  
	
  (f)

  	
   

  	
  Not Applicable

  

 

vi

 

	
  Section 315(a)

  	
   

  	
  601(a)

  
	
  (b)

  	
   

  	
  602, 703(a)

  
	
  (c)

  	
   

  	
  601(b)

  
	
  (d)

  	
   

  	
  601(c)

  
	
  (d)(1)

  	
   

  	
  601(a)

  
	
  (d)(2)

  	
   

  	
  601(c)

  
	
  (d)(3)

  	
   

  	
  601(c)

  
	
  (e)

  	
   

  	
  514

  
	
   

  	
   

  	
   

  
	
  Section 316(a)

  	
   

  	
  101

  
	
  (a)(1)(A)

  	
   

  	
  512

  
	
  (a)(1)(B)

  	
   

  	
  513

  
	
  (a)(2)

  	
   

  	
  Not Applicable

  
	
  (b)

  	
   

  	
  508

  
	
  (c)

  	
   

  	
  104(f)

  
	
   

  	
   

  	
   

  
	
  Section 317(a)(1)

  	
   

  	
  503

  
	
  (a)(2)

  	
   

  	
  504

  
	
  (b)

  	
   

  	
  1003

  
	
   

  	
   

  	
   

  
	
  Section 318(a)

  	
   

  	
  107

  

 

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

 

vii

 

JUNIOR
SUBORDINATED INDENTURE, dated as of           ,
         between PRINCIPAL FINANCIAL
GROUP, INC., a Delaware corporation (hereinafter called the “Company”)
PRINCIPAL FINANCIAL SERVICES, INC., an Iowa corporation and wholly-owned
subsidiary of the Company, as guarantor (hereinafter called the “Subsidiary
Guarantor”), each having its principal office at 711 High Street, Des
Moines, Iowa 50392, and WILMINGTON
TRUST COMPANY, a Delaware banking corporation duly organized and
existing under the laws of the State of Delaware, as trustee (hereinafter
called the “Trustee”).

 

RECITALS OF THE
COMPANY AND THE SUBSIDIARY GUARANTOR

 

Each
of the Company and the Subsidiary Guarantor has duly authorized the execution
and delivery of this Indenture to provide for the issuance from time to time of
the Company’s unsecured junior subordinated debt securities in series
(hereinafter called the “Securities”) of substantially the tenor
hereinafter provided, including, without limitation, Securities issued to
evidence loans made to the Company of the proceeds from the issuance from time
to time by one or more statutory trusts (each a “Principal Trust”, and
collectively, the “Principal Trusts”) of preferred trust interests in
such Trusts (the “Preferred Securities”) and common interests in such
Trusts (the “Common Securities”), and, if applicable, the guarantee
thereof by the Subsidiary Guarantor, on an unsecured junior subordinated basis
and subject to the limitations hereinafter provided, and to provide the terms
and conditions upon which the Securities are to be authenticated, issued and
delivered.

 

All
things necessary to make the Securities, when executed by the Company and
authenticated and delivered hereunder and duly issued by the Company, the valid
obligations of the Company, and, if applicable, any guarantee, the valid obligation
of the Subsidiary Guarantor, and to make this Indenture a valid agreement of
the Company and, to the extent applicable, the Subsidiary Guarantor, in
accordance with their and its terms, have been done.

 

NOW
THEREFORE, THIS INDENTURE WITNESSETH:

 

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

 

ARTICLE ONE

 

Definitions and other
Provisions of General Application

 

Section 101     Definitions.  For all purposes of this Indenture, except as
otherwise expressly provided or unless the context otherwise requires:

 

 

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

 

(2)           All other terms used herein which are
defined in the Trust Indenture Act, either directly or by reference therein,
have the meanings assigned to them therein;

 

(3)           All accounting terms not otherwise
defined herein have the meanings assigned to them in accordance with generally
accepted accounting principles, and the term “generally accepted accounting
principles” with respect to any computation required or permitted hereunder
shall mean such accounting principles which are generally accepted at the date
or time of such computation; provided, that when two or more principles are so
generally accepted, it shall mean that set of principles consistent with those
in use by the Company; and

 

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

 

Certain terms, used
principally in Article Six, are defined in that Article.

 

“Act”, when used
with respect to any Holder, has the meaning specified in Section 104.

 

“Additional Interest”
means the interest, if any, that shall accrue on any interest on the Securities
of any series that is in arrears for more than one interest payment period or
not paid during any Extension Period, which in either case shall accrue at the
rate per annum specified or determined as specified in such Security.

 

“Additional Sums”
has the meaning specified in Section 1007.

 

“Additional Taxes”
means the sum of additional taxes, duties and other governmental charges to
which a Principal Trust has become subject from time to time as a result of a
Tax Event.

 

“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; provided, however, that an Affiliate of the Company shall
not be deemed to include any Principal Trust to which Securities have been
issued.  For the purposes of this
definition, “control” when used with respect to any specified Person means the
power to direct 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.

 

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“Authenticating Agent”
means any Person authorized by the Trustee pursuant to Section 614 to act
on behalf of the Trustee to authenticate Securities of one or more series.

 

“Board of Directors”
means the board of directors of the Company or the Subsidiary Guarantor, as
applicable, any duly authorized committee of that board or any officer of the
Company or the Subsidiary Guarantor, delegated the power of either the board of
directors of the Company or the Subsidiary Guarantor, as applicable, or any
committee of that board duly authorized to act hereunder.

 

“Board Resolution”
means a copy of a resolution certified by the Secretary, the Corporate
Secretary or an Assistant Secretary of the Company or the Subsidiary Guarantor,
as applicable, to have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such certification, and delivered to the
Trustee.

 

“Business Day”
means any day other than (i) a Saturday or Sunday or (ii) a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed or (iii) a day
on which the Corporate Trust Office of the Trustee, or, with respect to the
Securities of a series issued to a Principal Trust, the principal office of the
Property Trustee under the related Trust Agreement, is closed for business.

 

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

 

“Common Securities”
has the meaning specified in the first recital of this Indenture.

 

“Company” means
the Person named as the “Company” in the first paragraph of this instrument
until a successor corporation shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter “Company” shall mean such
successor corporation.

 

“Company Request”
and “Company Order” mean, respectively, the written request or order
signed in the name of the Company by the Chairman, President, Chief Executive
Officer, a Vice President or any other person duly authorized from time to time
by the Company or its Board of Directors, and by the Treasurer, an Associate
Treasurer, a Director, Corporate Treasury, the Controller, the Secretary, the
Corporate Secretary, an Assistant Secretary of the Company or any other person
duly authorized from time to time by the Company or its Board of Directors, and
delivered to the Trustee or, with respect to Company Requests and Company
Orders delivered pursuant to Sections 303, 

 

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304, 305 and 603, any other employee of the Company
named in an Officer’s Certificate delivered to the Trustee.

 

“Corporate Trust
Office” means the principal office of the Trustee at which at any
particular time its corporate trust business shall be administered.

 

“Corporation”
includes corporations, associations, companies and business trusts.

 

“Current Value”
has the meaning specified in Section 1107.

 

“Defaulted Interest”
has the meaning specified in Section 307.

 

“Depositary”
means, with respect to the Securities of any series issuable or issued in whole
or in part in the form of one or more Global Securities, the Person designated
as Depositary by the Company pursuant to Section 301 with respect to such
series (or any successor thereto).

 

“Discounted Remaining
Fixed Amount Payments” has the meaning specified in Section 1107.

 

“Discounted Swap
Equivalent Payments” has the meaning specified in Section 1107.

 

“Dollar” means the
currency of the United States of America as at the time of payment is legal
tender for the payment of public and private debts.

 

“Event of Default”,
unless otherwise specified in the supplemental indenture creating a series of
Securities, has the meaning specified in Section 501

 

“Extension Period”
has the meaning specified in Section 311.

 

“Foreign Currency”
means any currency issued by the government of one or more countries other than
the United States of America or by any recognized confederation or association
of such governments.

 

“Global Security”
means a Security in the form prescribed in Section 204 evidencing all or
part of a series of Securities, issued to the Depositary or its nominee for
such series, and registered in the name of such Depositary or its nominee.

 

“Government
Obligations” means, with respect to the Securities of any series,
securities which are (i) direct obligations of the United States of
America or (ii) obligations of a Person controlled or supervised by
and acting as an agency or instrumentality of the United States of America the
payment of which is unconditionally guaranteed by the United States of America
and which, in either case, are full faith and credit obligations of the United
States of America and are not callable or redeemable at 

 

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the option of the issuer thereof and shall also
include a depository receipt issued by a bank (as defined in Section 3(a)(2) of
the Securities Act of 1933, as amended) as custodian with respect to any such
Government Obligation or a specific payment of interest on or principal of any
such Government Obligation held by such custodian for the account of the holder
of such depository receipt; provided that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depository receipt from any amount received by the
custodian in respect of the Government Obligation or the specific payment of
interest on or principal of the Government Obligation evidenced by such
depository receipt.

 

“Holder” means a
Person in whose name a Security is registered in the Securities Register.

 

“Indebtedness” of
any Person means the principal of (and premium, if any) and interest due on
indebtedness of such Person, whether outstanding on the date of this Indenture
or thereafter created, incurred or assumed, whether recourse is to all or a
portion of the assets of such Person and whether or not contingent which is (i) indebtedness
for money borrowed, and (ii) any amendments, renewals, extensions,
modifications and refundings of any such indebtedness.  For the purposes of this definition, “indebtedness
for money borrowed” means (a) any obligation of, or any obligation
guaranteed by, such Person for the repayment of borrowed money, whether or not
evidenced by bonds, debentures, notes or other written instruments, (b) any
obligation of, or any such obligation guaranteed by, such Person evidenced by
bonds, debentures, notes or similar written instruments, including obligations
assumed or incurred in connection with the acquisition of property, assets or
businesses (provided, however, that the deferred purchase price of
any property, assets or business shall not be considered Indebtedness if the
purchase price thereof is payable in full within 90 days from the date on which
such indebtedness was created), and (c) any obligations of such
Person as lessee under leases required to be capitalized on the balance sheet
of the lessee under generally accepted accounting principles and leases of
property or assets made as part of any sale and lease-back transaction to which
such Person is a party.  Indebtedness
does not include trade accounts payable or accrued liabilities arising in the
ordinary course of business.

 

“Indenture” means
this instrument as originally executed or as it may from time to time be
supplemented or amended by one or more indentures supplemental hereto entered
into pursuant to the applicable provisions hereof, and shall include the terms
of each particular series of Securities established as contemplated by Section 301.

 

“Interest Payment Date”
means, as to each series of Securities, the Stated Maturity of an installment
of interest on such Securities.

 

“Interest Rate”
means the rate of interest specified or determined as specified in each
Security as being the rate of interest payable on such Security.

 

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“Investment Company
Event” means, in respect of a Principal Trust, the occurrence of a change
in law or regulation or a change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority (a “Change in 1940 Act Law”) to the effect that such Principal
Trust is or will be considered an “investment company” that is required to be
registered under the 1940 Act, which Change in 1940 Act Law becomes effective
on or after the date of original issuance of the Preferred Securities of such
Principal Trust.

 

“Junior Subordinated
Payment” has the meaning specified in Section 1202.

 

“Lien” means any
mortgage, pledge, lien, security interest or other encumbrance.

 

“Maturity” when
used with respect to any Security means the date on which the principal of such
Security becomes due and payable as therein or herein provided, whether at the
Stated Maturity or by declaration of acceleration, call for redemption or
otherwise.

 

“1940 Act” means
the Investment Company Act of 1940, as amended.

 

“Officers’ Certificate”
means a certificate signed by the (i) Chairman, President, Chief
Executive Officer or any Vice President, and (ii) the Treasurer,
any Associate Treasurer, any Assistant Treasurer, the Controller, the Secretary,
the Corporate Secretary or any Assistant Secretary of the Company or the
Subsidiary Guarantor, as applicable, and delivered to the Trustee.

 

“Opinion of Counsel”
means a written opinion of counsel, who may be counsel for the Company or the
Subsidiary Guarantor, as applicable.

 

“Original Issue Date”
means the date of issuance specified as such in each Security.

 

“Original Issue
Discount Security” means any security which provides for an amount less
than the principal amount thereof to be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 502.

 

“Outstanding”
means, as of the date of determination, all Securities theretofore
authenticated and delivered under this Indenture, except:  (i) Securities theretofore canceled
by the Trustee or delivered to the Trustee for cancellation; (ii) Securities
for whose payment money in the necessary amount has been theretofore deposited
with the Trustee or any Paying Agent in trust for the Holders of such
Securities; provided that, if such Securities are to be redeemed, notice
of such redemption has been duly given pursuant to this Indenture or provision
therefore satisfactory to the Trustee has been made; and (iii) Securities
in substitution for or in lieu of which other Securities have been
authenticated and delivered or which have been paid pursuant to Section 306,
unless 

 

6

 

proof satisfactory to the Trustee is presented that
any such Securities are held by Holders in whose hands such Securities are
valid, binding and legal obligations of the Company; provided, however,
that in determining whether the Holders of the requisite principal amount of
Outstanding Securities have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Securities owned by the Company
or any other obligor upon the Securities or any Affiliate of the Company or
such other obligor shall be disregarded and deemed not to be outstanding,
except that, in determining whether the Trustee shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Securities which the Trustee knows to be so owned shall be so
disregarded.  Securities so owned which
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee’s right so to act
with respect to such Securities and that the pledgee is not the Company or any
other obligor upon the Securities or any Affiliate of the Company or such other
obligor.  Upon request of the Trustee,
the Company shall furnish to the Trustee promptly an Officers’ Certificate
listing and identifying all Securities, if any, known by the Company to be
owned or held by or for the account of the Company, or any other obligor on the
Securities or any Affiliate of the Company or such obligor, and, subject to the
provisions of Section 601, 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 Securities not listed therein are Outstanding for the
purpose of any such determination.

 

“Paying Agent”
means the Trustee or any Person authorized by the Company to pay the principal
of or interest on any Securities on behalf of the Company.

 

“Person” means any
individual, corporation, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization or government or any agency or
political subdivision thereof.

 

“Place of Payment”
means, with respect to the Securities of any series, the place or places where
the principal of (and premium, if any) and interest on the Securities of such
series are payable pursuant to Section 301 or 311.

 

“Predecessor Security”
of any particular Security means every previous Security evidencing all or a
portion of the same debt as that evidenced by such particular Security; and,
for the purposes of this definition, any security authenticated and delivered
under Section 306 in lieu of a lost, destroyed or stolen Security shall be
deemed to evidence the same debt as the lost, destroyed or stolen Security.

 

“Preferred Securities”
has the meaning specified in the first recital of this Indenture.

 

“Principal Guarantee”
means the guarantee by the Company of distributions on the Preferred Securities
of a Principal Trust to the extent provided in the Principal 

 

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Guarantee Agreement, substantially in the form
attached hereto as Annex C, or substantially in such form as may be specified
as contemplated by Section 301 with respect to the Securities of any
series, in each case as amended from time to time.

 

“Principal Guarantee
Agreement” means the Guarantee Agreement executed and delivered by the
Company and Wilmington Trust Company, as trustee, contemporaneously with the
execution and delivery of the Trust Agreement, for the benefit of the holders
of the Preferred Securities, as amended from time to time.

 

“Principal Trust”
has the meaning specified in the first recital of this Indenture.

 

“Proceeding” has
the meaning specified in Section 1202.

 

“Property Trustee”
means, in respect of any Principal Trust, the commercial bank or trust company
identified as the “Property Trustee” in the related Trust Agreement, solely in
its capacity as Property Trustee of such Principal Trust under such Trust
Agreement and not in its individual capacity, or its successor in interest in
such capacity, or any successor property trustee appointed as therein provided.

 

“Regular Record Date”
for the interest payable on any Interest Payment Date with respect to the
Securities of a series means, unless otherwise provided pursuant to Section 301
with respect to Securities of a series, the date which is fifteen days next
preceding such Interest Payment Date (whether or not a Business Day).

 

“Responsible Officer”
when used with respect to the Trustee, means any officer of the Trustee
assigned by the Trustee from time to time to administer its corporate trust
matters.

 

“Restricted Subsidiary”
means Principal Life Insurance Company and any other Subsidiary which is
incorporated under the laws of any state of the United States or the District
of Columbia and which is a regulated insurance company principally engaged in
one or more of the life, annuity, property and casualty insurance businesses, provided
that no such Subsidiary, other than Principal Life Insurance Company, shall be
a Restricted Subsidiary if (i) the total assets of such Subsidiary
are less than 10% of the total assets of the Company and its consolidated
Subsidiaries (including such Subsidiary), in each case as set forth on the most
recent fiscal year-end balance sheets of such Subsidiary and the Company and
its consolidated Subsidiaries, respectively, and computed in accordance with
generally accepted accounting principles, or (ii) in the judgment
of the Board of Directors, as evidenced by a Board Resolution, such Subsidiary
is not material to the financial condition of the Company and its consolidated
Subsidiaries taken as a whole.

 

“Securities” or “Security”
means any debt securities or debt security, as the case may be, authenticated
and delivered under this Indenture.

 

8

 

“Securities Register”
and “Securities Registrar” have the respective meanings specified in Section 305.

 

“Senior Indebtedness”
means the principal of (and premium, if any) and interest, if any (including
interest accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Company or the Subsidiary Guarantor, as
applicable, whether or not such claim for post-petition interest is allowed in
such proceeding), on Indebtedness (of the Company or the Subsidiary Guarantor,
as applicable), whether incurred on or prior to the date of this Indenture or
thereafter incurred, unless, in the instrument creating or evidencing the same
or pursuant to which the same is outstanding or pursuant to the terms
established pursuant to Section 301 hereof, it is provided that such
obligations are not superior in right of payment to the Securities or to other
Indebtedness which is pari passu with, or subordinated to, the Securities.

 

“Special Event”
means a Tax Event or an Investment Company Event.

 

“Special Record Date”
for the payment of any Defaulted Interest means a date fixed by the Trustee
pursuant to Section 307.

 

“Stated Maturity”
when used with respect to any Security or any installment of principal thereof
or interest thereon means the date specified in such Security as the date on
which the principal of such Security or such installment of interest is due and
payable.

 

“Subsidiary” means
any corporation of which, at the time of determination, the Company and/or one
or more Subsidiaries owns or controls directly or indirectly more than 50% of
the outstanding shares of voting stock. 
For purposes of this definition, “voting stock” means stock which has
voting power for the election of directors, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.

 

“Subsidiary Guarantee”
when used with respect to the Securities of or within any series, means a
guarantee by the Subsidiary Guarantor, on a junior subordinated basis, of the
obligations of the Company under the Securities, which guarantee may be included
in an indenture or indentures supplemental hereto; provided, however,
that the Subsidiary Guarantor may guarantee, on a junior subordinated basis,
only obligations of the Company under non-convertible securities.

 

“Subsidiary Guarantor”
means the Person named as the “Subsidiary Guarantor” in the first paragraph of
this instrument and its successors and assigns.

 

“Tax Event” means
the receipt by a Principal Trust of an Opinion of Counsel experienced in such
matters to the effect that, as a result of any amendment to, or change
(including any announced prospective change) in, the laws (or any regulations
thereunder) of the United States or any political subdivision or taxing
authority thereof or 

 

9

 

therein affecting taxation, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
such pronouncement or decision is announced on or after the date of issuance of
the Preferred Securities of such Principal Trust, there is more than an
insubstantial risk that (i) the Principal Trust is, or will be
within 90 days of the date thereof, subject to United States Federal income tax
with respect to income received or accrued on the corresponding series of
Securities, (ii) interest payable by the Company on the
corresponding series of Securities is not, or within 90 days of the date
thereof, will not be, deductible, in whole or in part, for United States Federal
income tax purposes or (iii) the Principal Trust is, or will be
within 90 days of the date thereof, subject to more than a de minimis amount of
other taxes, duties or other governmental charges.

 

“Trust Agreement”
means the Trust Agreement substantially in the form attached hereto as Annex A,
as amended by the form of Amended and Restated Trust Agreement substantially in
the form attached hereto as Annex B, or substantially in such form as may be
specified as contemplated by Section 301 with respect to the Securities of
any series, in each case as amended from time to time.

 

“Trustee” means
the Person named as the “Trustee” in the first paragraph of this instrument
until a successor Trustee shall have become such pursuant to the applicable
provisions of this Indenture, and thereafter “Trustee” shall mean or include
each Person who is then a Trustee hereunder and, if at any time there is more
than one such Person, “Trustee” as used with respect to the Securities of any
series shall mean the Trustee with respect to Securities of that series.

 

“Trust Indenture Act”
means the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbb), as
amended and as in effect on the date as of this Indenture, except as provided
in Section 905.

 

“Vice President”
when used with respect to the Company, means any vice president, whether or not
designated by a number or a word or words added before or after the title “vice
president.”

 

Section 102            Compliance Certificate and
Opinions.  Upon any application or
request by the Company or the Subsidiary Guarantor to the Trustee to take any
action under any provision of this Indenture, the Company or the Subsidiary
Guarantor, as the case may be, shall furnish to the Trustee an Officers’
Certificate stating that all conditions precedent (including covenants,
compliance with which constitutes a condition precedent), if any, provided for
in this Indenture relating to the proposed action have been complied with and
an Opinion of Counsel stating that in the opinion of such counsel all such conditions
precedent (including covenants compliance with which constitute a condition
precedent), if any, have been complied with, except that in the case of any
such application or request as to which the furnishing of such documents is
specifically 

 

10

 

required by any provision of this Indenture relating
to such particular application or request, no additional certificate or opinion
need be furnished.

 

Every certificate or
opinion with respect to compliance with a condition or covenant provided for in
this Indenture (other than the certificates provided pursuant to Section 1006)
shall include:

 

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

 

(2)           a
brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions contained in such certificate or opinion
are based;

 

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

 

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

 

Section 103            Forms of Documents Delivered to
Trustee.  In any case where several
matters are required to be certified by, or covered by an opinion of, any
specified Person, it is not necessary that all such matters be certified by, or
covered by the opinion of, only one such Person, or that they be so certified
or covered by only one document, but one such Person may certify or give an
opinion with respect to some matters and one or more other such Persons as to
other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents.

 

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

 

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

 

11

 

Section 104            Acts of Holders.

 

(a)           Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture
to be given to or taken by Holders may be embodied in and evidenced by one or
more instruments of substantially similar tenor signed by such Holders in
person or by an agent duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments is or are delivered to the Trustee, and, where it is
hereby expressly required, to the Company and the Subsidiary Guarantor.  Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the “Act” of the Holders signing such instrument or instruments.  Proof of execution of any such instrument or
of a writing appointing any such agent shall be sufficient for any purpose of
this Indenture and (subject to Section 601) conclusive in favor of the
Trustee, the Company, the Subsidiary Guarantor and any agent of the Trustee,
the Company or the Subsidiary Guarantor, if made in the manner provided in this
Section.

 

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

 

(c)           The fact and date of the execution by
any Person of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner which the Trustee
deems sufficient and in accordance with such reasonable rules as the
Trustee may determine.

 

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

 

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

 

(f)            The Company may, but shall not be
obligated to, fix a record date for the purpose of determining the Holders
entitled to take any action under this Indenture by vote or consent.  Except as otherwise provided herein, such
record date shall be the later of 30 days prior to the first solicitation of
such consent or vote or the date of the most recent list of Securityholders
furnished to the Trustee pursuant to Section 701 prior to 

 

12

 

such solicitation. 
If a record date is fixed, those persons who were Securityholders at
such record date (or their duly designated proxies), and only those persons,
shall be entitled to take such action by vote or consent or to revoke any vote
or consent previously given, whether or not such persons continue to be Holders
after such record date, provided, however, that unless such vote
or consent is obtained from the Holders (or their duly designated proxies) of
the requisite principal amount of Outstanding Securities prior to the date
which is the 120th day after such record date, any such vote or consent
previously given shall automatically and without further action by any Holder
be canceled and of no further effect.

 

Section 105            Notices, Etc. to Trustee, Company
and Subsidiary Guarantor.  Any request,
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given
or furnished to, or filed with, (1) the Trustee by any Holder or by
the Company or by the Subsidiary Guarantor shall be sufficient for every
purpose hereunder if made, given, furnished or filed in writing to or with the
Trustee at its Corporate Trust office, (2) the Company by the
Trustee or by any Holder shall be sufficient for every purpose (except as
otherwise provided in Section 501 hereof) hereunder if in writing and
mailed, first class, postage prepaid, to the Company addressed to it at the
address of its principal office specified in the first paragraph of this
instrument or at any other address previously furnished in writing to the
Trustee by the Company or (3) the Subsidiary Guarantor by the
Trustee or by any Holder shall be sufficient for every purpose (except as
otherwise provided in Section 501 hereof) hereunder if in writing and
mailed, first class, postage prepaid, to the Subsidiary Guarantor addressed to
it at the address of its principal office specified in the first paragraph of
this instrument or at any other address previously furnished in writing to the
Trustee by the Subsidiary Guarantor. 
None of the Company, the Subsidiary Guarantor nor the Trustee shall be
deemed to have received any such request, demand, authorization, direction,
notice, consent, waiver or Act of Holders unless given, furnished or filed as
provided in this Section 105.

 

Section 106            Notice to Holders; Waiver.  Where this Indenture provides for notice to
Holders of any event, such notice shall be sufficiently given (unless otherwise
herein expressly provided) if in writing and mailed, first class postage
prepaid, to each Holder affected by such event, at the address of such Holder
as it appears in the Securities Register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving of such notice.  In any case where notice to Holders is given
by mail, neither the failure to mail such notice, nor any defect in any notice
so mailed, to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders.  Where this
Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice.  Waivers of notice by Holders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.

 

13

 

Section 107            Conflict With Trust Indenture Act.  If any provision of this Indenture limits,
qualifies or conflicts with the duties imposed by any of Sections 310 to 317,
inclusive, of the Trust Indenture Act through operation of Section 318(c) thereof,
such imposed duties shall control.

 

Section 108            Effect of Headings and Table of
Contents.  The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.

 

Section 109            Successors and Assigns.  All covenants and agreements in this
Indenture by the Company or the Subsidiary Guarantor shall bind their
respective successors and assigns, whether so expressed or not.

 

Section 110            Separability Clause.  In case any provision in this Indenture or in
the Securities shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.

 

Section 111            Benefits of Indenture.  Nothing in this Indenture or in the
Securities, express or implied, shall give to any Person, other than the
parties hereto, any Paying Agent and their successors and assigns and the
Holders of the Securities, any benefit or any legal or equitable right, remedy
or claim under this Indenture.

 

Section 112            Governing Law.  This Indenture and the Securities shall be
governed by and construed in accordance with the laws of the State of New York.

 

Section 113            Non-Business Days.  In any case where any Interest Payment Date
or Stated Maturity of any Security shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or the Securities)
payment of interest or principal need not be made on such date, but may be made
on the next succeeding Business Day and no interest shall accrue for the period
from and after such Interest Payment Date or Stated Maturity, as the case may
be, until the next succeeding Business Day, in each case with the same force
and effect as if made on the Interest Payment Date or at the Stated Maturity,
except that, if such Business Day is in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day.

 

ARTICLE TWO

 

Security Forms

 

Section 201            Forms Generally.  The Securities of each series and the Trustee’s
certificate of authentication shall be in substantially the forms set forth in
this Article, or in such other form or forms as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental
hereto, in each case with such appropriate 

 

14

 

insertions,
omissions, substitutions and other variations as are required or permitted by
this Indenture and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with applicable tax laws or the rules of any securities
exchange or as may, consistently herewith, be determined by the officers
executing such securities, as evidenced by their execution of the
Securities.  If the form of Securities of
any series is established by action taken pursuant to a Board Resolution, a
copy of an appropriate record of such action shall be certified by the
Secretary or an Assistant Secretary of the Company and delivered to the Trustee
at or prior to the delivery of the Company Order contemplated by 303 with
respect to the authentication and delivery of such Securities.

 

The Trustee’s
certificates of authentication shall be substantially in the form set forth in
this Article.

 

The definitive Securities
shall be printed, lithographed or engraved or produced by any combination of
these methods, if required by any securities exchange on which the Securities
may be listed, on a steel engraved border or steel engraved borders or may be
produced in any other manner permitted by the rules of any securities
exchange on which the Securities may be listed, all as determined by the
officers executing such Securities, as evidenced by their execution of such
securities.

 

Section 202            Form of Face of Security.  [If the Security is a Global Security, insert
— This Security is a Global Security within the meaning of the Indenture
hereinafter referred to and is registered in the name of The Depository Trust
Company (the “Depository”) or a nominee of the Depository.  This Security is exchangeable for Securities
registered in the name of a person other than the Depository or its nominee
only in the limited circumstances described in the Indenture and no transfer of
this Security (other than a transfer of this Security as a whole by the
Depository to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository) may be registered except
in limited circumstances.

 

Unless this Security is
presented by an authorized representative of The Depository Trust Company (55
Water Street, New York) to Principal Financial Group, Inc. or its agent
for registration of transfer, exchange or payment, and any Security issued is
registered in the name of Cede & Co. or such other name as requested
by an authorized representative of The Depository Trust Company and any payment
hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]  If the Security is an Original Issue Discount
Security, insert — This Security was issued with original issue discount for
United States Federal income tax purposes. 
For further information, please contact [name, title and address or
telephone number of a representative of the Company].

 

15

 

PRINCIPAL
FINANCIAL GROUP, INC.

(Title of Security)

 

	
  No.          

  	
   

  	
  $                 

  

 

PRINCIPAL FINANCIAL
GROUP, INC., a corporation organized and existing under the laws of Delaware
(hereinafter called the “Company”, which term includes any successor
corporation under the Indenture hereinafter referred to), for value received,
hereby promises to pay to               ,
or registered assigns, the principal sum of             
Dollars on                 ,[;
provided that the Company may (i) change the maturity date
upon the occurrence of an exchange of the Securities for the Trust Securities
subject to certain conditions set forth in Section 314 of the Indenture,
which changed maturity date shall in no case be earlier than           ,
or later than           , and
(ii) extend the maturity date subject to certain conditions
specified in Section 314 of the Indenture, which extended maturity date
shall in no case be later than       
,].  The Company further promises
to pay interest on said principal sum from             ,
       or from the most recent interest payment
date (each such date, an “Interest Payment Date”) on which interest has
been paid or duly provided for, [monthly] [quarterly] [semi-annually] [if
applicable, insert-(subject to deferral as set forth herein)] in arrears on
[insert applicable Interest Payment Dates] of each year, commencing             ,
      , at the rate of       %
per annum, until the principal hereof shall have become due and payable, [if
applicable, insert- plus Additional Interest, if any,] until the principal
hereof is paid or duly provided for or made available for payment [if
applicable, insert- and on any overdue principal and (without duplication and
to the extent that payment of such interest is enforceable under applicable
law) on any overdue installment of interest at the rate of       %
per annum, compounded [monthly] [quarterly] [annually].  The amount of interest payable for any period
will be computed on the basis of twelve 30-day months and a 360-day year.  The amount of interest payable for any
partial period shall be computed on the basis of the number of days elapsed in
a 360-day year of twelve 30-day months. 
In the event that any date on which interest is payable on this Security
is not a Business Day, then a payment of the interest payable on such date will
be made on the next succeeding day which is a Business Day (and without any
interest or other payment in respect of any such delay), except that, if such
Business Day is in the next succeeding calendar year, such payment shall be
made on the immediately preceding Business Day, in each case with the same
force and effect as if made on the date the payment was originally
payable.  A “Business Day” shall
mean any day other than a day on which banking institutions in the City of New
York are authorized or required by law or executive order to remain closed or a
day on which the Corporate Trust Office of the Trustee [if applicable, insert;
or the principal office of the Property Trustee under the Trust Agreement
hereinafter referred to for Principal Capital     ,] is
closed for business.  The interest
installment 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 Security (or one or more Predecessor Securities, as defined
in the Indenture) is registered at the close of business on the Regular Record
Date 

 

16

 

for such interest installment, which shall be the
[[insert Regular Record Dates] (whether or not a Business Day)] [close of
business on the Business Day] next preceding such Interest Payment Date.  Any such interest installment not so
punctually paid or duly provided for shall forthwith cease to be payable to the
Holder on such Regular Record Date and may either be paid to the Person in
whose name this Security (or one or more Predecessor Securities) is registered
at the close of business on a Special Record Date for the payment of such
Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to
Holders of Securities of this series not less than 10 days prior to such
Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Securities of this series may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture.

 

[If applicable, insert-
The Company shall have the right at any time during the term of this Security,
from time to time, to defer the payment of interest otherwise due and payable
on such Security for up to      consecutive [months]
[quarters] with respect to each deferral period (each an “Extension Period”),
during which periods the Company shall have the right to make no or partial
payments of interest on any Interest Payment Date, and at the end of which the
Company shall pay all interest then accrued and unpaid (together with
Additional Interest thereon to the extent permitted by applicable law); [provided
that [during any such Extension Period, the Company will not, and will not
permit any Subsidiary of the Company to (i) declare or pay any
dividends or distributions or redeem, purchase, acquire or make a liquidation
payment with respect to, any of the Company’s outstanding capital stock or (ii) make
any payment of principal, interest or premium, if any, on or repay, repurchase
or redeem any debt security or guarantee that ranks pari passu with or junior
in interest to this Security (other than (a) dividends or
distributions in common stock of the Company, (b) redemptions or
purchases of any rights pursuant to the Company’s Rights Plan, or any successor
to such Rights Plan, and the declaration of a dividend of such rights in the
future, and (c) payments under any Principal Guarantee (as defined
in the Indenture))]  [insert other
applicable provisions].]  Prior to the
termination of any such Extension Period, the Company may further defer payment
of interest, provided that the Company may not defer payment of interest
beyond the Maturity of this Security. 
Upon the termination of any such Extension Period and upon the payment
of all accrued and unpaid interest and any Additional Interest then due, the
Company may select a new Extension Period, subject to the above
requirements.  No interest shall be due
and payable during an Extension Period except at the end thereof.  The Company shall give the Holder of this
Security and the Trustee notice of its selection of an Extension Period at
least one Business Day prior to the Interest Payment Date [if applicable,
insert- the earlier of (i) the date the Distributions on the
Preferred Securities are payable or (ii) the date the
Administrative Trustees are required to give notice to the New York Stock
Exchange or other applicable self-regulatory organization or to holders of such
Preferred Securities of the record date or the date such Distributions are
payable, but in any event not less than one Business Day prior to such record
date.

 

17

 

Payment of the principal
of (and premium, if any) and interest on this Security will be made at the
office or agency of the Company maintained for that purpose in the United
States, 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 [if
applicable, insert-; provided, however, that at the option of the
Company payment of interest may be made (i) by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Securities Register or (ii) by wire transfer in immediately
available funds at such place and to such account as may be designated by the
Person entitled thereto as specified in the Securities Register].

 

The indebtedness
evidenced by this Security is, to the extent provided in the Indenture,
subordinate and subject in right of payments to the prior payment in full of
all Senior Indebtedness of the Company, and this Security is issued subject to
the provisions of the Indenture with respect thereto.  Each Holder of this Security, by accepting
the same, (a) agrees to and shall be bound by such provisions, (b) authorizes
and directs the Trustee on his behalf to take such actions as may be necessary
or appropriate to effectuate the subordination so provided and (c) appoints
the Trustee his attorney-in-fact for any and all such purposes.  Each Holder hereof, by his acceptance hereof,
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness of the
Company, whether now outstanding or hereafter incurred, and waives reliance by
each such holder upon said provisions.

 

Reference is hereby made
to the further provisions of this Security set forth on the reverse hereof,
which further provisions shall for all purposes have the same effect as if set
forth at this place.

 

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

 

IN WITNESS WHEREOF, the
Company has caused this instrument to be duly executed under its corporate
seal.

 

	
  Dated:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PRINCIPAL FINANCIAL GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  

 

18

 

Section 203            Form of Reverse of Security.  This Security is one of a duly authorized
issue of securities of the Company, (herein called the “Securities”),
issued and to be issued in one or more series under a Junior Subordinated
Indenture, dated as of               ,
         (herein called the “Indenture”),
between the Company, Principal Financial Services, Inc. as guarantor
(herein called the “Subsidiary Guarantor”) and Wilmington Trust Company,
as Trustee (herein called the “Trustee”, which term includes any
successor trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Trustee,
the Company, the Subsidiary Guarantor and the Holders of the Securities, and of
the terms upon which the Securities are, and are to be, authenticated and
delivered.  This Security is one of the
series designated on the face hereof[, limited in aggregate principal amount to
$            ].

 

All terms used in this
Security that are defined in the Indenture [if applicable, insert- or in the
Trust Agreement, dated                   ,
as amended (the “Trust Agreement”), among Principal Financial Group, Inc.
as Depositor, and the Trustees named therein, for Principal Capital     ,]
shall have the meanings assigned to them in the Indenture [if applicable,
insert- or the Trust Agreement, as the case may be].

 

[If applicable, insert-
The Company may, at its option, subject to the terms and conditions of Article Eleven
of the Indenture, redeem this Security after its date of issuance in whole or
in part at any time and from time to time, without premium or penalty, at a
redemption price equal to the accrued and unpaid interest [if applicable,
insert-, including Additional Interest, if any,] to the date fixed for
redemption, plus the greater of (a) the principal amount thereof
and (b) an amount equal to [for Securities bearing interest at a
fixed rate:  the Discounted Remaining
Fixed Amount Payments] [for Securities bearing interest determined by a
floating rate:  the Discounted Swap
Equivalent Payments].

 

[If applicable, insert-
If a Special Event in respect of a Principal Trust shall occur and be
continuing, the Company may, at its option, redeem the corresponding series of
Securities on any date falling within 90 days of the occurrence of such Special
Event, in whole but not in part, subject to the provisions of Section 1107
and the other provisions of Article Eleven of the Indenture.  The redemption price for any Security so
redeemed shall be equal to 100% of the principal amount thereof plus accrued
and unpaid interest, including Additional Interest, if any, to the date fixed
for redemption.]

 

[Installments of accrued
and unpaid interest whose Stated Maturity is on or prior to the Redemption Date
will be payable to the Holders of the Securities of this series, or one or more
Predecessor Securities, registered as such at the close of business on the
relevant Regular Record Dates according to their terms.]

 

19

 

In the event of
redemption of this Security in part only, a new Security or Securities of this
series for the unredeemed portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.

 

[If the Security is not
an Original Issue Discount Security, - If an Event of Default with respect to
Securities of this series shall occur and be continuing, the principal of the
Securities of this series may be declared due and payable in the manner, with
the effect and subject to the conditions provided in the Indenture.] [If the security
is an Original Issue Discount Security, - If an Event of Default with respect
to Securities of this series shall occur and be continuing, an amount of
principal of the Securities of this series may be declared due and payable in
the manner, with the effect and subject to the conditions provided in the
Indenture.  Such amounts shall be equal
to - insert formula for determining the amount. 
Upon payment (i) of the amount of principal so declared due
and payable and (ii) of interest on any overdue principal and
overdue interest (in each case to the extent that the payment of such interest
shall be legally enforceable), all of the Company’s obligations in respect of
the payment of the principal of and interest, if any, on the Securities of this
series shall terminate.]

 

The Indenture contains
provisions for satisfaction, discharge and defeasance at any time of the entire
indebtedness of this Security upon compliance by the Company with certain
conditions set forth in the Indenture.

 

The Indenture permits, with
certain exceptions as therein provided, the amendment thereof and the
modification of the rights and obligations of the Company and the rights of the
Holders of the Securities of each series to be affected under the Indenture at
any time by the Company and the Trustee with the consent of the Holders of a
majority in principal amount of the Securities of each series at the time
Outstanding of each series to be affected. 
The Indenture also contains provisions permitting Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences.  Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.

 

No reference herein to
the Indenture and no provision of this Security or of the Indenture shall alter
or impair the obligation of the Company, which is absolute and unconditional,
to pay the principal of (and premium, if any) and interest on this Security at
the times, place and rate, and in the coin or currency, herein prescribed.

 

As provided in the
Indenture and subject to certain limitations therein set forth, the transfer of
this Security is registrable in the Securities Register, upon surrender of this

 

20

 

Security for registration of transfer at the office or
agency of the Company maintained under Section 1002 of the Indenture duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Securities Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Securities of this series, of authorized denominations and for the
same aggregate principal amount, will be issued to the designated transferee or
transferees.  No service charge shall be
made for any such registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.

 

Prior to due presentment
of this Security for registration of transfer, the Company, the Trustee and any
agent of the Company or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes, whether or not
this Security be overdue, and neither the Company, the Trustee nor any such
agent shall be affected by notice to the contrary.

 

The Securities of this
series are issuable only in registered form without coupons in denominations of
$         and any integral multiple
thereof.  As provided in the Indenture
and subject to certain limitations therein set forth, Securities of this series
are exchangeable for a like aggregate principal amount of Securities of such
series of a different authorized denomination, as requested by the Holder
surrendering the same.

 

[If applicable, insert-
The Company and, by its acceptance of this Security or a beneficial interest
therein, the Holder of, and any Person that acquires a beneficial interest in,
this Security agree that for United States Federal, state and local tax
purposes it is intended that this Security constitute indebtedness.]

 

THE INDENTURE AND THIS
SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.

 

Section 204            Additional Provisions Required in
Global Security.  Any Global Security
issued hereunder shall, in addition to the provisions contained in Sections 202
and 203 bear a legend in substantially the following form:

 

“This Security is a
Global Security within the meaning of the Indenture hereinafter referred to and
is registered in the name of a Depositary or a nominee of a Depositary.  This Security is exchangeable for Securities
registered in the name of a person other than the Depositary or its nominee
only in the limited circumstances described in the Indenture and may not be
transferred except as a whole by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary.”

 

21

 

Section 205            Form of Trustee’s
Certificate of Authentication.  This
is one of the Securities referred to in the within mentioned Indenture.

 

 

	
   

  	
  Wilmington Trust Company, as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
					

 

ARTICLE THREE

 

The Securities

 

Section 301            Title and Terms.  The aggregate principal amount of Securities
which may be authenticated and delivered under this Indenture is unlimited.

 

The Securities may
be issued in one or more series.  There
shall be established in or pursuant to a Board Resolution, and set forth in an
Officers’ Certificate, or established in one or more indentures supplemental
hereto, prior to the issuance of Securities of a series:

 

(A)          the title of the Securities of such
series, which shall distinguish the Securities of the series from all other
Securities;

 

(B)           the limit, if any, upon the aggregate
principal amount of the Securities of such series which may be authenticated
and delivered under this Indenture (except for Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu of,
other Securities of the same series pursuant to Section 304, 305, 306, 906
or 1106); provided, however, that the authorized aggregate
principal amount of such series may be increased above such amount by a Board
Resolution to such effect;

 

(C)           the Stated Maturity or Maturities on
which the principal of the Securities of such series is payable or the method
of determination thereof;

 

(D)          the rate or rates, if any, at which
the Securities of such series shall bear interest, if any, the rate or rates
and extent to which Additional Interest, if any, shall be payable in respect of
any Securities of such series, the Interest Payment Dates on which such
interest shall be payable, the right, pursuant to Section 311 or as
otherwise set forth therein, of the Company to defer or extend 

 

22

 

an Interest Payment Date, and the Regular Record Date
for the interest payable on any Interest Payment Date or the method by which
any of the foregoing shall be determined;

 

(E)           the place or places where the
principal of (and premium, if any) and interest on the Securities of such
series shall be payable, the place or places where the Securities of such
series may be presented for registration of transfer or exchange, and the place
or places where notices and demands to or upon the Company in respect of the
Securities of such series may be made;

 

(F)           the period or periods within or the
date or dates on which, if any, the price or prices at which and the terms and
conditions upon which the Securities of such series may be redeemed, in whole
or in part, at the option of the Company;

 

(G)           the obligation or the right, if any,
of the Company or the Subsidiary Guarantor, as applicable, to redeem, repay or
purchase the Securities of such series pursuant to any sinking fund,
amortization or analogous provisions or at the option of a Holder thereof and
the period or periods within which, the price or prices at which, the currency
or currencies (including currency unit or units) in which and the other terms
and conditions upon which Securities of the series shall be redeemed, repaid or
purchased, in whole or in part, pursuant to such obligation;

 

(H)          the denominations in which any
Securities of such series shall be issuable, if other than denominations of $25
and any integral multiple thereof;

 

(I)            if other than Dollars, the currency
or currencies (including currency unit or units) in which the principal of (and
premium, if any) and interest, if any, on the Securities of the series shall be
payable, or in which the Securities of the series shall be denominated;

 

(J)            the additions, modifications or
deletions, if any, in the Events of Default or covenants of the Company or the
Subsidiary Guarantor set forth herein with respect to the Securities of such
series;

 

(K)          if other than the principal amount
thereof, the portion of the principal amount of Securities of such series that
shall be payable upon declaration of acceleration of the Maturity thereof;

 

(L)           the additions or changes, if any, to
this Indenture with respect to the Securities of such series as shall be
necessary to permit or facilitate the issuance of the Securities of such series
in bearer form, registrable or not registrable as to principal, and with or
without interest coupons;

 

23

 

(M)         any index or indices used to determine
the amount of payments of principal of and premium, if any, on the Securities
of such series or the manner in which such amounts will be determined;

 

(N)          the issuance of a temporary Global
Security representing all of the Securities of such series and exchange of such
temporary Global Security for definitive Securities of such series;

 

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

 

(P)           the appointment of any Paying Agent
or Agents for the Securities of such series;

 

(Q)          the terms of any right to convert or
exchange Securities of such series into any other securities or property of the
Company, and the additions or changes, if any, to this Indenture with respect
to the Securities of such series to permit or facilitate such conversion or
exchange;

 

(R)           the form or forms of the Trust
Agreement, Amended and Restated Trust Agreement and Guarantee Agreement, if
different from the forms attached hereto as Annexes A, B and C, respectively;

 

(S)           the relative degree, if any, to which
the Securities of the series shall be senior to or be subordinated to other
series of Securities in right of payment, whether such other series of
Securities are Outstanding or not;

 

(T)           whether and under what circumstances
any or all of the provisions of this Indenture relating to the subordination of
the Securities (including the provisions of Article Twelve), or different
subordination provisions, including a different definition of “Senior
Indebtedness” will apply or cease to apply to Securities of such series;

 

(U)          provided the Securities of such
series are non-convertible, whether the Subsidiary Guarantor will guarantee, on
an unsecured junior subordinated basis, the obligations of the Company under
the Securities of such series and if so, the specific terms and form of such
Subsidiary Guarantee or Subsidiary Guarantees, any related modifications,
amendments, supplements or deletions of any of the terms of this Indenture, and
a statement that the Subsidiary Guarantor shall be an “obligor” as such term is
defined in and solely for purposes of the Trust Indenture Act and shall be
required to comply with those provisions of this 

 

24

 

Indenture compliance with which is required by an “obligor”
under the Trust Indenture Act; and

 

(V)           any other terms of the Securities of
such series or any related Subsidiary Guarantee (which terms shall not be
inconsistent with the provisions of the Trust Indenture Act, but may modify,
amend, supplement or delete any of the terms of this Indenture with respect to
such series), including any terms which may be required by or advisable under
United States laws or regulations or advisable (as determined by the Company)
in connection with the marketing of Securities of the series; 

 

provided,
that if the Subsidiary Guarantor will guarantee the obligations of the Company
under the Securities of a series, such matters shall be established in one or
more indenture supplements hereto to which the Company, the Subsidiary
Guarantor and the Trustee shall be a party.

 

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

 

If any of the terms of
the series are established by action taken pursuant to a Board Resolution, a
copy of an appropriate record of such action shall be certified by the
Secretary or an Assistant Secretary of the Company and delivered to the Trustee
at or prior to the delivery of the Officers’ Certificate setting forth the
terms of the series.

 

Section 302            Denominations.  The Securities of each series shall be in
registered form without coupons and shall be issuable in denominations of $25
and any integral multiple thereof, unless otherwise specified as contemplated
by Section 301.

 

Section 303            Execution, Authentication,
Delivery and Dating.  The Securities
shall be executed on behalf of the Company by its President or one of its Vice
Presidents.  The signature of any of
these officers on the Securities may be manual or facsimile.

 

Securities bearing the
manual or facsimile signature of an individual who was at any time a proper
officer of the Company shall bind the Company, notwithstanding that such
individual has ceased to hold such office prior to the authentication and
delivery of such Securities or did not hold such office at the date of such
Securities.  At any time and from time to
time after the execution and delivery of this Indenture, the Company may
deliver Securities executed by the Company to the Trustee for
authentication.  Securities may be
authenticated on original issuance from time to time and delivered pursuant to
such procedures acceptable to the Trustee (“Procedures”) as may be
specified from time to time by Company Order. 
Procedures may authorize authentication and delivery 

 

25

 

pursuant to oral instructions of the Company or a duly
authorized agent, which instructions shall be promptly confirmed in writing.

 

Prior to the delivery of
a Security in any such form to the Trustee for authentication, the Company
shall deliver to the Trustee the following:

 

(A)          A Company Order requesting the Trustee’s
authentication and delivery of all or a portion of the Securities of such
series, and if less than all, setting forth procedures for such authentication;

 

(B)           The Board Resolution by or pursuant
to which such form of Security has been approved, and the Board Resolution, if
any, by or pursuant to which the terms of the Securities of such series have
been approved, and, if pursuant to a Board Resolution, an Officers’ Certificate
describing the action taken;

 

(C)           An Officers’ Certificate dated the
date such certificate is delivered to the Trustee, stating that all conditions
precedent provided for in this Indenture relating to the authentication and delivery
of Securities in such form and with such terms have been complied with; and

 

(D)          An Opinion of Counsel stating that (i) the
form of such Securities has been duly authorized and approved in conformity
with the provisions of this Indenture; (ii) the terms of such
Securities have been duly authorized and determined in conformity with the
provisions of this Indenture, or, if such terms are to be determined pursuant
to Procedures, when so determined such terms shall have been duly authorized
and determined in conformity with the provisions of this Indenture; and (iii) Securities
in such form when completed by appropriate insertions and executed and
delivered by the Company to the Trustee for authentication in accordance with
this Indenture, authenticated and delivered by the Trustee in accordance with
this Indenture within the authorization as to aggregate principal amount
established from time to time by the Board of Directors and sold in the manner
specified in such opinion of Counsel, will be the legal, valid and binding
obligations of the Company entitled to the benefits of this Indenture, subject
to applicable bankruptcy, reorganization, insolvency and similar laws generally
affecting creditors’ rights, to general equitable principles except as enforcement
thereof may be limited by (A) requirements that a claim with
respect to any Securities denominated other than in Dollars (or a Foreign
Currency or currency unit judgment in respect of such claim) be converted into
Dollars at a rate of exchange prevailing on a date determined pursuant to
applicable law or (B) governmental authority to limit, delay or
prohibit the making of payments in Foreign Currencies or currency units or
payments outside the United States and subject to such other qualifications as
such counsel shall conclude do not materially affect the rights of Holders of
such Securities;

 

26

 

provided,
however, that the Trustee shall be entitled to receive the documents
referred to in Clauses (b), (c) and (d) above only at or prior to the
first request of the Company to the Trustee to authenticate Securities of such
series.

 

Each Security shall be
dated the date of its authentication.

 

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

 

Section 304            Temporary Securities.  Pending the preparation of definitive
Securities of any series, the Company may execute, and upon Company Order the
Trustee shall authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any
denomination, substantially of the tenor of the definitive Securities of such
series in lieu of which they are issued and with such appropriate insertions,
omissions, substitutions and other variations as the officers executing such
Securities may determine, as evidenced by their execution of such Securities.

 

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

 

Section 305            Registration, Transfer and
Exchange.  The Company shall cause to
be kept at the Corporate Trust Office of the Trustee a register in which,
subject to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of Securities and of transfers of Securities.  Such register is herein sometimes referred to
as the “Securities Register.”  The
Trustee is hereby appointed “Securities Registrar” for the purpose of
registering Securities and transfers of Securities as herein provided.

 

Upon surrender for
registration of transfer of any Security at the office or agency of the Company
designated for that purpose the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one 

 

27

 

or more new Securities of the same series of any
authorized denominations, of a like aggregate principal amount, of the same
original Issue Date and Stated Maturity and having the same terms.

 

At the option of the
Holder, Securities may be exchanged for other Securities of the same series of
any authorized denominations, of a like aggregate principal amount, of the same
Original Issue Date and Stated Maturity and having the same terms, upon
surrender of the Securities to be exchanged at such office or agency.  Whenever any securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.

 

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

 

Every Security presented
or surrendered for transfer or exchange shall (if so required by the Company or
the Securities Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company and the Securities
Registrar, duly executed by the Holder thereof or his attorney duly authorized
in writing.

 

No service charge shall
be made to a Holder for any transfer or exchange of Securities, but the Company
may require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any transfer or exchange of
Securities, other than exchanges pursuant to Section 304, 906 or 1106.

 

Notwithstanding any of
the foregoing, any Global Security of a series shall be exchangeable pursuant
to this Section 305 for Securities registered in the names of Persons
other than the Depositary for such Security or its nominee only if (i) such
Depositary notifies the Company that it is unwilling or unable to continue as
Depositary for such Global Security or if at any time such Depositary ceases to
be a clearing agency registered under the Securities Exchange Act of 1934, as
amended, (ii) the Company executes and delivers to the Trustee a
Company Order that such Global Security shall be so exchangeable or (iii) there
shall have occurred and be continuing an Event of Default with respect to the
Securities of such series.  Any Global
Security that is exchangeable pursuant to the preceding sentence shall be
exchangeable for Securities registered in such names as such Depositary shall
direct.

 

Notwithstanding any other
provision in this Indenture, a Global Security may not be transferred except as
a whole by the Depositary with respect to such Global Security to a nominee of
such Depositary or by a nominee of such Depositary to such Depositary or another
nominee of such Depositary.

 

28

 

Neither the Company nor
the Trustee shall be required, pursuant to the provisions of this Section, (a) to
issue, transfer or exchange any Security of any series during a period
beginning at the opening of business 15 calendar days before the day of
selection for redemption of Securities pursuant to Article Eleven and
ending at the close of business on the day of mailing of notice of redemption
or (b) to transfer or exchange any Security so selected for
redemption in whole or in part, except, in the case of any Security to be
redeemed in part, any portion thereof not to be redeemed.

 

Section 306            Mutilated, Destroyed, Lost and
Stolen Securities.  If any mutilated
Security is surrendered to the Trustee together with such security or indemnity
as may be required by the Company or the Trustee to save each of them harmless,
the Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor a new Security of the same issue and series of like tenor and
principal amount, having the same Original Issue Date and Stated Maturity and
bearing the same Interest Rate as such mutilated Security, and bearing a number
not contemporaneously outstanding.

 

If there shall be
delivered to the Company and to the Trustee (i) evidence to their
satisfaction of the destruction, loss or theft of any Security, and (ii) such
security or indemnity as may be required by them to save each of them harmless,
then, in the absence of notice to the Company or the Trustee that such Security
has been acquired by a bona fide purchaser, the issuing Company shall execute
and upon its request the Trustee shall authenticate and deliver, in lieu of any
such destroyed, lost or stolen Security, a new Security of the same issue and
series of like tenor and principal amount, having the same Original Issue Date
and Stated Maturity and bearing the same Interest Rate as such destroyed, lost
or stolen Security, and bearing a number not contemporaneously outstanding.

 

In case any such
mutilated, destroyed, lost or stolen Security has become or is about to become
due and payable, the Company in its discretion may, instead of issuing a new
Security, pay such Security.

 

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

 

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

 

29

 

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

 

Section 307            Payment
of Interest; Interest Rights Preserved. 
Interest on any Security of any series which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date, shall be
paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest in respect of Securities of such series, except that, unless
otherwise provided in the Securities of such series, interest payable on the
Stated Maturity of a Security shall be paid to the Person to whom principal is
paid.  The initial payment of interest on
any Security of any series which is issued between a Regular Record Date and
the related Interest Payment Date shall be payable as provided in such Security
or in the Board Resolution pursuant to Section 301 with respect to the
related series of Securities.

 

Any
interest on any Security which is payable, but is not timely paid or duly
provided for, on any Interest Payment Date for Securities of such series
(herein called “Defaulted Interest”), shall forthwith cease to be
payable to the registered Holder on the relevant Regular Record Date by virtue
of having been such Holder, and such Defaulted Interest may be paid by the
Company, at its election in each case, as provided in Clause (1) or (2) below:

 

(1)           The
Company may elect to make payment of any Defaulted Interest to the Persons in
whose names the Securities of such series in respect of which interest is in
default (or their respective Predecessor Securities) are registered at the
close of business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner.  The Company shall notify the Trustee in
writing of the amount of Defaulted Interest proposed to be paid on each
Security and the date of the proposed payment, and at the same time the Company
shall deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit 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 15 days and not less than 10 days prior to the date of
the proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment.  The Trustee shall promptly notify the Company
of such Special Record Date and, in the name and at the expense of the Company,
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 of a Security of such series at 

 

30

 

the address of such Holder as it appears in the
Securities Register not less than 10 days prior to such Special Record
Date.  The Trustee may, in its
discretion, in the name and at the expense of the Company, cause a similar
notice to be published at least once in a newspaper, customarily published in
the English language on each Business Day and of general circulation in the
[Borough of Manhattan, The City of New York], but such publication shall not be
a condition precedent to the establishment of such Special Record Date.  Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been mailed as
aforesaid, such Defaulted Interest shall be paid to the Persons in whose names
the Securities of such series (or their respective Predecessor Securities) are
registered on such Special Record Date and shall no longer be payable pursuant
to the following Clause (2).

 

(2)           The
Company may make payment of any Defaulted Interest in any other lawful manner
not inconsistent with the requirements of any securities exchange on which the
Securities of the series in respect of which interest is in default may be
listed and, upon such notice as may be required by such exchange (or by the
Trustee if the Securities are not listed), if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this Clause, such
payment shall be deemed practicable by the Trustee.

 

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

 

Section 308            Persons
Deemed Owners.  The Company, the
Subsidiary Guarantor, the Trustee and any agent of the Company, the Subsidiary
Guarantor or the Trustee may treat the Person in whose name any Security is
registered as the owner of such Security for the purpose of receiving payment
of principal of and (subject to Section 307) interest on such Security or
any payment pursuant to any Subsidiary Guarantee of such Security and for all
other purposes whatsoever, whether or not such Security be overdue, and none of
the Company, the Subsidiary Guarantor, the Trustee and any agent of the
Company, the Subsidiary Guarantor or the Trustee shall be affected by notice to
the contrary.

 

Section 309            Cancellation.  All Securities surrendered for payment,
redemption, transfer or exchange shall, if surrendered to any Person other than
the Trustee, be delivered to the Trustee, and any such Securities and
Securities surrendered directly to the Trustee for any such purpose shall be
promptly canceled by it.  The Company may
at any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in
any manner whatsoever, and all Securities so delivered shall be promptly
canceled by the Trustee.  No Securities
shall be authenticated in lieu of or in exchange for any Securities canceled as

 

31

 

provided in this Section, except as expressly
permitted by this Indenture.  All
canceled Securities shall be disposed of by the Trustee as directed by a
Company Order and the Trustee shall deliver to the Company a certificate
evidencing the disposition of the cancelled securities.

 

Section 310            Computation
of Interest.  Except as otherwise
specified as contemplated by Section 301 for Securities of any series,
interest on the Securities of each series shall be computed on the basis of a
360-day year of twelve 30-day months and interest on the Securities of each
series for any partial period shall be computed on the basis of the number of
days elapsed in a 360-day year of twelve 30-day months.

 

Section 311            Deferrals
of Interest Payments.  If specified
as contemplated by Section 301 with respect to the Securities of a particular
series, the Company shall have the right, at any time during the term of such
series, from time to time to defer the payment of interest otherwise due and
payable on such Securities for such period or periods as may be specified as
contemplated by Section 301 (each, an “Extension Period”) during
which periods the Company shall have the right to make no or partial payments
of interest on any Interest Payment Date, and at the end of such Extension
Period the Company shall pay all interest then accrued and unpaid thereon
(together with Additional Interest thereon, if any, at the rate specified for
the Securities of such series to the extent permitted by applicable law), provided,
however, that, unless otherwise specified with respect to Securities of
such series pursuant to Section 301, during any such Extension Period, the
Company shall not, and shall cause any Subsidiary not to, (i) declare
or pay any dividends or distributions on, or redeem, purchase, acquire or make
a liquidation payment with respect to, any of the Company’s capital stock, or (ii) make
any payment of principal, interest or premium, if any, on or repay, repurchase
or redeem any debt securities or guarantees that rank pari  passu
with or junior in interest to the Securities of such series (other than (a) dividends
or distributions in common stock of the Company, (b) redemptions or
purchases of any rights pursuant to the Company’s Rights Plan, or any successor
to such Rights Plan, and the declaration of a dividend of such rights in the
future, and (c) payments under any Principal Guarantee).  Prior to the termination of any such
Extension Period, the Company may further defer payment of interest, provided
that the Company may not defer payment of interest beyond the Maturity of such
Securities.  Upon termination of any
Extension Period and upon the payment of all accrued and unpaid interest and
any Additional Interest then due, the Company may select a new Extension
Period, subject to the above requirements. 
No interest shall be due and payable during an Extension Period, except
at the end thereof.  The Company shall
give the Holders of the Securities of such series and the Trustee notice of its
selection of such Extension Period at least one Business Day prior to the
Interest Payment Date or, with respect to the Securities of a series issued to
a Principal Trust, prior to the earlier of (i) the date the
Distributions on the Preferred Securities of such Principal Trust are payable
or (ii) the date the Administrative Trustees of such Principal Trust
are required to give notice to the New York Stock Exchange or other 

 

32

 

applicable self-regulatory organization or to holders
of such Preferred Securities of the record date or the date such Distributions
are payable, but in any event not less than one Business Day prior to such
record date.

 

The
Trustee shall promptly give notice of the Company’s selection of such Extension
Period to the Holders of the outstanding Securities of such series.

 

Section 312            Right
of Set-Off.  With respect to the
Securities of a series issued to a Principal Trust, notwithstanding anything to
the contrary in the Indenture, the Company shall have the right to set-off any
payment it is otherwise required to make thereunder in respect of any such
Security to the extent the Company has theretofore made, or is concurrently on
the date of such payment making, a payment under the Principal Guarantee
relating to such Security or a payment to any Holder of a corresponding series
of Preferred Securities in connection with a suit instituted pursuant to Section 508.

 

Section 313            Agreed
Tax Treatment.  Each Security issued
hereunder shall provide that the Company and, by its acceptance of a Security
or a beneficial interest therein, the Holder of, and any Person that acquires a
beneficial interest in, such Security agree that for United States Federal,
state and local tax purposes it is intended that such Security constitute
indebtedness.

 

Section 314            Extension
of Stated Maturity; Adjustment of Stated Maturity Upon an Exchange.  If specified as contemplated by Section 202
with respect to the Securities of a particular series, the Company shall have
the right to (a) change the Maturity Date of the Securities of such
series upon the liquidation of a Principal Trust and the exchange of such
Securities for the Preferred Securities of such Principal Trust and (b) extend
the Stated Maturity for the Securities of such series; provided, that at
time any election to extend the Maturity Date is made and at the time of such
extension, (i) the Company is not in bankruptcy, otherwise
insolvent or in liquidation, (ii) the Company is not in default in
the payment of any interest or principal on the Securities of such series and
no deferred interest payments thereon have accrued, (iii) the
applicable Principal Trust is not in arrears on payments of Distributions on
its Preferred Securities and no deferred Distributions thereon are accumulated,
(iv) the Securities are rated not less than [BBB- by Standard &
Poor’s Ratings Services or Baa3 by Moody’s Investors Service, Inc.] or the
equivalent by any other nationally recognized statistical rating organization
and (v) the extended Stated Maturity is no later than the 49th
anniversary of the initial issuance of the Preferred Securities of the
applicable Principal Trust; provided, further, that, if the
Company exercises its right to liquidate the Principal Trust and exchange the
Securities of such series for the Preferred Securities of such Principal Trust
as specified in clause (a) above, any changed Stated Maturity of the
Securities of such series shall be no earlier than the date that is five years
after the issuance of the Preferred Securities and no later than the date 30
years (plus an extended term of up to an additional 19 years if the above-

 

33

 

referenced conditions are satisfied) after the date of
the initial issuance of the Preferred Securities of the applicable Principal
Trust.

 

Section 315            CUSIP
Numbers.  The Company in issuing the
Securities 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
Holders; that any such notice may state that no representation is made as to
the correctness of such numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.

 

ARTICLE FOUR

 

Satisfaction and
Discharge

 

Section 401            Satisfaction
and Discharge of Indenture.  This
Indenture shall cease to be of further effect with respect to Securities of a
series (except as to (i) any surviving rights of transfer,
substitution and exchange of Securities, (ii) rights hereunder of
Holders to receive payments of principal of (and premium, if any) and interest
on such Securities and other rights, duties and obligations of the Holders as
beneficiaries hereof with respect to the amounts, if any, so deposited with the
Trustee and (iii) the rights and obligations of the Trustee
hereunder), and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments acknowledging satisfaction and discharge of
this Indenture with respect to such Securities, when

 

(1)           either

 

(A)          all
such Securities theretofore authenticated and delivered (other than (i) Securities
which have been destroyed, lost or stolen and which have been replaced or paid
as provided in Section 306 and (ii) Securities for whose
payment money has theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or discharged from
such trust, as provided in Section 1003) have been delivered to the
Trustee for cancellation; or

 

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

 

(i)  have
become due and payable, or

 

(ii)  will
become due and payable at their Stated Maturity within one year, and the
Company, in the case of (i) or (ii) above, has deposited or caused to
be deposited with the Trustee as trust funds in trust for such purpose an
amount in the currency or 

 

34

 

currencies in which the
Securities of such series are payable sufficient to pay and discharge the
entire indebtedness on such Securities not theretofore delivered to the Trustee
for cancellation, for principal (and premium, if any) and interest (including
any Additional Interest) to the date of such deposit (in the case of Securities
which have become due and payable) or to the Stated Maturity;

 

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

 

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

 

Notwithstanding
the satisfaction and discharge of this Indenture, the obligations of the
Company to the Trustee under Section 607 and, if money shall have been
deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the obligations of the Trustee under Section 402 and the
last paragraph of Section 1003 shall survive.

 

Section 402            Application
of Trust Money.  Subject to the
provisions of the last paragraph of Section 1003, all money deposited with
the Trustee pursuant to Section 401 or money or Government Obligations
deposited with the Trustee pursuant to Section 403, or received by the
Trustee in respect of Government Obligations deposited with the Trustee
pursuant to Section 403, shall be held in trust and applied by it, in
accordance with the provisions of the Securities of the applicable series and
this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money or obligations have been
deposited with or received by the Trustee; provided, however,
such moneys need not be segregated from other funds except to the extent
required by law.

 

Section 403            Satisfaction,
Discharge and Defeasance of Securities of Any Series.  Unless otherwise provided in the Board
Resolution adopted pursuant to Section 301 establishing the terms of the
Securities of any series, the Company shall be deemed to have paid and
discharged the entire indebtedness on all the Outstanding Securities of any
such series and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of such
indebtedness, when

 

(1)           with
respect to all Outstanding Securities of such series,

 

(A)          the
Company has irrevocably deposited or caused to be irrevocably deposited with
the Trustee as trust funds in trust for such 

 

35

 

purpose an amount
sufficient to pay and discharge the entire indebtedness on all Outstanding
Securities of such series for principal (and premium, if any) and interest
(including any Additional Interest) to the Stated Maturity or any Redemption
Date as contemplated by the penultimate paragraph of this Section 403, as
the case may be; or

 

(B)           the
Company has irrevocably deposited or caused to be irrevocably deposited with
the Trustee as obligations in trust for such purpose an amount of Government
Obligations as will, in the written opinion of independent public accountants
delivered to the Trustee, together with predetermined and certain income to
accrue thereon, without consideration of any reinvestment thereof, be sufficient
to pay and discharge when due the entire indebtedness on all Outstanding
Securities of such series for principal (and premium, if any) and interest
(including any Additional Interest) to the Stated Maturity or any Redemption
Date as contemplated by the penultimate paragraph of this Section 403, as
the case may be; and

 

(2)           the
Company has paid or caused to be paid all other sums payable with respect to
the Outstanding Securities of such series; and

 

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

 

Any
deposits with the Trustee referred to in Section 403(1) above shall
be irrevocable and shall be made under the terms of an escrow trust agreement
in form and substance reasonably satisfactory to the Trustee.  If any Outstanding Securities of such series
are to be redeemed prior to their Stated Maturity, whether pursuant to any
optional redemption provisions or in accordance with any mandatory sinking fund
requirement, the applicable escrow trust agreement shall provide therefor and
the Company shall make such arrangements as are satisfactory to the Trustee for
the giving of notice of redemption by the Trustee in the name, and at the
expense, of the Company.  If the
Securities of such series are not to become due and payable at their Stated
Maturity or upon call for redemption within one year of the date of deposit,
then the Company shall give, not later than the date of such deposit, notice of
such deposit to the Holders of Securities of such series.

 

Upon
the satisfaction of the conditions set forth in this Section 403 with
respect to all the Outstanding Securities of any series, the terms and
conditions of such series, including the terms and conditions with respect
thereto set forth in this Indenture, shall no longer be binding upon, or
applicable to, the Company; provided, that the Company shall not be
discharged from any payment obligations in respect of Securities of such series

 

36

 

which are deemed
not to be Outstanding under clause (iii) of the definition thereof if
such obligations continue to be valid obligations of the Company under
applicable law.

 

ARTICLE FIVE

 

Remedies

 

Section 501            Events
of Default.  “Event of Default”,
wherever used herein with respect to the Securities of any series, means any
one of the following events (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):

 

(1)           default
in the payment of any interest upon any Security of that series, including any
Additional Interest in respect thereof, when it becomes due and payable, and
continuance of such default for a period of 30 days (subject to the deferral of
any due date in the case of an Extension Period); or

 

(2)           default
in the payment of the principal of (or premium, if any, on) any Security of
that series at its Maturity; or

 

(3)           default
in the performance, or breach, of any covenant or warranty of the Company in
this Indenture (other than a covenant or warranty a default in whose
performance or whose breach is elsewhere in this Section specifically
dealt with), and continuance of such default or breach for a period of 90 days
after there has been given, by registered or certified mail, to the Company by
the Trustee or to the Company and the Trustee by the Holders of at least 25% in
principal amount of the Outstanding Securities of that series a written notice
specifying such default or breach and requiring it to be remedied; or

 

(4)           the
entry of a decree or order by a court having jurisdiction in the premises
adjudging the Company a bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization, arrangement, adjustment or composition of or
in respect of the Company under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law, or appointing a receiver,
liquidator, assignee, trustee, sequestrator (or other similar official) of the
Company or of any substantial part of its property or ordering the winding up
or liquidation of its affairs, and the continuance of any such decree or order
unstayed and in effect for a period of 60 consecutive days; or

 

(5)           the
institution by the Company of proceedings to be adjudicated a bankrupt or
insolvent, or the consent by it to the institution of bankruptcy or insolvency
proceedings against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under any applicable Federal or State 

 

37

 

bankruptcy, insolvency, reorganization or other
similar law, or the consent by it to the filing of any such petition or to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or
other similar official) of the Company or of any substantial part of its
property, or the making by it of an assignment for the benefit of creditors, or
the admission by it in writing of its inability to pay its debts generally as
they become due and its willingness to be adjudicated a bankrupt, or the taking
of corporate action by the Company in furtherance of any such action; or

 

(6)           any
other Event of Default with respect to Securities of that series.

 

Section 502            Acceleration
of Maturity; Rescission and Annulment. 
If an Event of Default (other than an Event of Default specified in Section 501(4) or
501(5)) with respect to Securities of any series at the time Outstanding occurs
and is continuing, then and in every such case the Trustee or the Holders of
not less than 25% in principal amount of the Outstanding Securities of that
series may declare the principal amount (or, if the Securities of that series
are Original Issue Discount Securities, such portion of the principal amount as
may be specified in the terms of that series) of all the Securities of that
series to be due and payable immediately, by a notice in writing to the Company
(and to the Trustee if given by Holders), provided that, in the case of
the Securities of a series issued to a Principal Trust, if upon an Event of
Default, the Trustee or the Holders of not less than 25% in principal amount of
the Outstanding Securities of that series fail to declare the principal of all
the Securities of that series to be immediately due and payable, the holders of
at least 25% in aggregate liquidation amount of the corresponding series of
Preferred Securities then outstanding shall have such right by a notice in
writing to the Company and the Trustee; and upon any such declaration such
principal amount (or specified amount) of and the accrued interest (including
any Additional Interest) on all the Securities of such series shall become
immediately due and payable, provided that the payment of principal and
interest (including any Additional Interest) on such Securities shall remain
subordinated to the extent provided in Article Twelve.  If an Event of Default specified in Section 501(4) or
501(5) with respect to Securities at the time Outstanding occurs, the
principal amount on all the Securities shall automatically, and without any
declaration or other action on the part of the Trustee or any Holder, become
immediately due and payable.

 

At any
time after such a declaration of acceleration with respect to Securities of any
series has been made and before a judgment or decree for payment of the money
due has been obtained by the Trustee as hereinafter in this Article provided,
the Holders of a majority in principal amount of the Outstanding Securities of
that series, by written notice to the Company and the Trustee, may rescind and
annul such declaration and its consequences if:

 

(1)           the
Company has paid or deposited with the Trustee a sum sufficient to pay

 

38

 

(A)          all
overdue installments of interest (including any Additional Interest) on all
Securities of that series,

 

(B)           the
principal of (and premium, if any, on) any Securities of that series which have
become due otherwise than by such declaration of acceleration and interest
thereon at the rate borne by the Securities,

 

(C)           to
the extent that payment of such interest is lawful, interest upon overdue
installments of interest at the rate borne by the Securities, and

 

(D)          all
sums paid or advanced by the Trustee hereunder and the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel;
and

 

(2)           all
Events of Default with respect to Securities of that series, other than the
non-payment of the principal of Securities of that series which has become due
solely by such acceleration, have been cured or waived as provided in Section 513.

 

No
such rescission shall affect any subsequent default or impair any right
consequent thereon.

 

Upon
receipt by the Trustee of written notice declaring such an acceleration, or
rescission and annulment thereof, with respect to Securities of a series all or
part of which is represented by a Global Security, a record date shall be
established for determining Holders of Outstanding Securities of such series
entitled to join in such notice, which record date shall be at the close of
business on the day the Trustee receives such notice.  The Holders on such record date, or their
duly designated proxies, and only such Persons, shall be entitled to join in
such notice, whether or not such Holders remain Holders after such record date;
provided, that, unless such declaration of acceleration, or rescission
and annulment, as the case may be, shall have become effective by virtue of the
requisite percentage having joined in such notice prior to the day which is 90
days after such record date, such notice of declaration of acceleration, or
rescission and annulment, as the case may be, shall automatically and without
further action by any Holder be canceled and of no further effect.  Nothing in this paragraph shall prevent a
Holder, or a proxy of a Holder, from giving, after expiration of such 90-day
period, a new written notice of declaration of acceleration, or rescission and
annulment thereof, as the case may be, that is identical to a written notice
which has been canceled pursuant to the proviso to the preceding sentence, in
which event a new record date shall be established pursuant to the provisions
of this Section 502.

 

39

 

Section 503            Collection
of Indebtedness and Suits for Enforcement by Trustee.  The Company covenants that if:

 

(1)           default
is made in the payment of any installment of interest (including any Additional
Interest) on any Security when such interest becomes due and payable and such
default continues for a period of 30 days, or

 

(2)           default
is made in the payment of the principal of (and premium, if any, on) any
Security at the Maturity thereof,

 

the
Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal, including any sinking fund payment or analogous
obligations (and premium, if any) and interest (including any Additional
Interest), including, to the extent that payment of such interest shall be
lawful, interest on any overdue principal (and premium if any) and on any
overdue installments of interest (including any Additional Interest) at the
rate borne by the Securities; and, in addition thereto, all amounts owing the
Trustee under Section 607.

 

If the
Company fails to pay such amounts forthwith upon such demand, the Trustee, in
its own name and as trustee of an express trust, may institute a judicial
proceeding for the collection of the sums so due and unpaid, and may prosecute
such proceeding to judgment or final decree, and may enforce the same against
the Company or any other obligor upon the Securities and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company or any other obligor upon the Securities, wherever
situated.

 

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

 

Section 504            Trustee
May File Proofs of Claim.  In
case of the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon the Securities or
the property of the Company or of such other obligor or their creditors:

 

(a)           the
Trustee (irrespective of whether the principal of the Securities of any series
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for 

 

40

 

the payment of overdue principal (and premium, if any)
or interest (including any Additional Interest)) shall be entitled and
empowered, by intervention in such proceeding or otherwise,

 

(i)            to
file and prove a claim for the whole amount of principal (and premium, if any)
and interest (including any Additional Interest) owing and unpaid in respect to
the Securities and to file such other papers or documents as may be necessary
or advisable and to take any and all actions as are authorized under the Trust
Indenture Act in order to have the claims of the Holders and any predecessor to
the Trustee under Section 607 and of the Holders allowed in any such
judicial proceedings; and

 

(ii)           and
in particular, the Trustee shall be authorized to collect and receive any
moneys or other property payable or deliverable on any such claims and to
distribute the same in accordance with Section 506; and

 

(b)           any
custodian, receiver, assignee, trustee, liquidator, sequestrator (or other
similar official) in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee for distribution in accordance with
Section 506, and in the event that the Trustee shall consent to the making
of such payments directly to the Holders, to pay to the Trustee any amount due
to it and any predecessor Trustee under Section 607.

 

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

 

Section 505            Trustee
May Enforce Claim Without Possession of Securities.  All rights of action and claims under this
Indenture or the Securities may be prosecuted and enforced by the Trustee
without the possession of any of the Securities or the production thereof in
any proceeding relating thereto, and any such 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 all the
amounts owing the Trustee and any predecessor Trustee under Section 607,
its agents and counsel, be for the ratable benefit of the Holders of the
Securities in respect of which such judgment has been recovered.

 

Section 506            Application
of Money Collected.  Any money or
property collected or to be applied by the Trustee with respect to a series of
Securities pursuant to this Article shall be applied in the following
order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money or property on account of principal (or premium, if
any) or interest (including any Additional Interest), upon presentation of the 

 

41

 

Securities and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:

 

FIRST:  To the payment of all amounts due the Trustee
and any predecessor Trustee under Section 607;

 

SECOND:  To the payment of the amounts then due and
unpaid upon such series of Securities for principal (and premium, if any) and
interest (including any Additional Interest), in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such series
of Securities for principal (and premium, if any) and interest (including any
Additional Interest), respectively; and

 

THIRD:  The balance, if any, to the Person or Persons
entitled thereto.

 

Section 507            Limitation
on Suits.  No Holder of any
Securities of any series shall have any right to institute any proceeding,
judicial or otherwise, with respect to this Indenture or for the appointment of
a receiver, assignee, trustee, liquidator, sequestrator (or other similar
official) or for any other remedy hereunder, unless:

 

(1)           such
Holder has previously given written notice to the Trustee of a continuing Event
of Default with respect to the Securities of that series;

 

(2)           the
Holders of not less than 25% in principal amount of the Outstanding Securities
of that series shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default in its own name as Trustee
hereunder;

 

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

 

(4)           
the Trustee for 60 days after its receipt of such notice, request and offer of
indemnity has failed to institute any such proceeding; and

 

(5)           no
direction inconsistent with such written request has been given to the Trustee
during such 60-day period by the Holders of a majority in principal amount of
the Outstanding Securities of that series; it being understood and intended
that no one or more of such Holders shall have any right in any manner whatever
by virtue of, or by availing of, any provision of this Indenture to affect,
disturb or prejudice the rights of any other Holders of Securities, or to
obtain or to seek to obtain priority or preference over any other of such
Holders or to enforce 

 

42

 

any right under this
Indenture, except in the manner herein provided and for the equal and ratable
benefit of all such Holders.

 

Section 508            Unconditional
Right of Holders to Receive Principal, Premium and Interest.  Notwithstanding any other provision in this
Indenture, the Holder of any Security shall have the right which is absolute
and unconditional to receive payment of the principal of (and premium, if any)
and (subject to Section 307) interest (including any Additional Interest)
on such Security on the respective Stated Maturities expressed in such Security
and to institute suit for the enforcement of any such payment, and such right
shall not be impaired without the consent of such Holder.  In the case of Securities of a series issued
to a Principal Trust, any holder of the corresponding series of Preferred
Securities shall have the right, upon the occurrence of an Event of Default
described in Section 501(1) or 501(2) hereof, to institute a
suit directly against the Company for enforcement of payment to such Holder of
principal of (premium, if any) and (subject to Section 307) interest
(including any Additional Interest) on the Securities having a principal amount
equal to the aggregate liquidation preference of the Preferred Securities of
the corresponding series held by such Holder.

 

Section 509            Restoration
of Rights and Remedies.  If the
Trustee or any Holder has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case the Company, the Subsidiary Guarantor,
the Trustee and the Holders shall, subject to any determination in such
proceeding, be restored severally and respectively to their former positions
hereunder, and thereafter all rights and remedies of the Trustee and the
Holders shall continue as though no such proceeding had been instituted.

 

Section 510            Rights
and Remedies Cumulative.  Except as
otherwise provided in the last paragraph of Section 306, no right or
remedy herein conferred upon or reserved to the Trustee or to the Holders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise.  The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.

 

Section 511            Delay
or Omission Not Waiver.  Except as
otherwise provided in the last paragraph of Section 306, no delay or
omission of the Trustee or of any Holder of any Security to exercise any right
or remedy accruing upon any Event of Default shall impair any such right or
remedy or constitute a waiver of any such Event of Default or an acquiescence
therein.

 

43

 

Every
right and remedy given by this Article or by law to the Trustee or to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.

 

Section 512            Control
by Holders.  The Holders of a
majority in principal amount of the Outstanding Securities of any series shall
have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on the Trustee, with respect to the Securities of such series, provided
that:

 

(1)           such
direction shall not be in conflict with any rule of law or with this
Indenture,

 

(2)           the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction, and

 

(3)           subject
to the provisions of Section 601, the Trustee shall have the right to
decline to follow such direction if the Trustee in good faith shall, by a
Responsible Officer or Officers of the Trustee, determine that the proceeding
so directed would be unjustly prejudicial to the Holders not joining in any
such direction or would involve the Trustee in personal liability.

 

Upon
receipt by the Trustee of any written notice directing the time, method or
place of conducting any such proceeding or exercising any such trust or power,
with respect to Securities of a series all or part of which is represented by a
Global Security, a record date shall be established for determining Holders of
Outstanding Securities of such series entitled to join in such notice, which
record date shall be at the close of business on the day the Trustee receives
such notice.  The Holders on such record
date, or their duly designated proxies, and only such Persons, shall be
entitled to join in such notice, whether or not such Holders remain Holders
after such record date; provided, that, unless the Holders of a majority
in principal amount of the Outstanding Securities of such series shall have
joined in such notice prior to the day which is 90 days after such record date,
such notice shall automatically and without further action by any Holder be
canceled and of no further effect. 
Nothing in this paragraph shall prevent a Holder, or a proxy of a
Holder, from giving, after expiration of such 90-day period, a new notice
identical to a notice which has been canceled pursuant to the proviso to the
preceding sentence, in which event a new record date shall be established
pursuant to the provisions of this Section 512.

 

Section 513            Waiver
of Past Defaults.  The Holders of not
less than a majority in principal amount of the Outstanding Securities of any
series may on behalf of the Holders of all the Securities of such series waive
any past default hereunder with respect to such series and its consequences,
except a default:

 

44

 

(1)           in
the payment of the principal of (or premium, if any) or interest (including any
Additional Interest) on any Security of such series, or

 

(2)           in
respect of a covenant or provision hereof which under Article Nine cannot
be modified or amended without the consent of the Holder of each Outstanding
Security of such series affected.

 

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

 

Section 514            Undertaking
for Costs.  All parties to this
Indenture agree, and each Holder of any Security by his acceptance thereof
shall be deemed to have agreed, that any court may in its discretion require,
in any suit for the enforcement of any right or remedy under this Indenture, or
in any suit against the Trustee for any action taken or omitted by it as
Trustee, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit, and that such court may in its discretion assess
reasonable costs, including reasonable attorneys’ fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this Section shall
not apply to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in
principal amount of the Outstanding Securities of any series, or to any suit
instituted by any Holder for the enforcement of the payment of the principal of
(or premium, if any) or interest (including any Additional Interest) on any
Security on or after the respective Stated Maturities expressed in such
Security.

 

Section 515            Waiver
of Stay or Extension Laws.  Each of
the Company and the Subsidiary Guarantor covenants (to the extent that it may
lawfully do so) that it will not at any time insist upon, or plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay or
extension law wherever enacted, now or at any time hereafter in force, which
may affect the covenants or the performance of this Indenture; and each of the
Company and the Subsidiary Guarantor (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution of any power herein
granted to the Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.

 

45

 

ARTICLE SIX

 

The Trustee

 

Section 601            Certain
Duties and Responsibilities.

 

(a)           Except
during the continuance of an Event of Default,

 

(1)           the
Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and

 

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

 

(b)           In
case an Event of Default has occurred and is continuing, 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 his own affairs.

 

(c)           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:

 

(1)           this
Subsection shall not be construed to limit the effect of Subsection (a) of
this Section;

 

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

 

(3)           the
Trustee shall not be liable with respect to any action taken or omitted to be
taken by it in good faith in accordance with the direction of Holders pursuant
to Section 512 relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or 

 

46

 

power conferred upon the Trustee, under this Indenture with respect to
the Securities of such series.

 

(d)           No
provision of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder, or in the exercise of any of its rights or powers, if
there shall be reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.

 

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

 

Section 602            Notice
of Defaults.  Within 90 days after
actual knowledge by a Responsible Officer of the Trustee of the occurrence of
any default hereunder with respect to the Securities of any series, the Trustee
shall transmit by mail to all Holders of Securities of such series, as their
names and addresses appear in the Securities Register, notice of such default
hereunder known to the Trustee, unless such default shall have been cured or
waived; provided, however, that, except in the case of a default
in the payment of the principal of (or premium, if any) or interest (including
any Additional Interest) on any Security of such series, the Trustee shall be
protected in withholding such notice if and so long as the board of directors,
the executive committee or a trust committee of directors and/or Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders of Securities of such series; and provided,
further, that, in the case of any default of the character specified in Section 501(3),
no such notice to Holders of Securities of such series shall be given until at
least 30 days after the occurrence thereof. 
For the purpose of this Section, the term “default” means any event
which is, or after notice or lapse of time or both would become, an Event of
Default with respect to Securities of such series.

 

Section 603            Certain
Rights of Trustee.  Subject to the
provisions of Section 601:

 

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

 

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

 

47

 

(C)           whenever
in the administration of this Indenture the Trustee shall deem it desirable
that a matter be proved or established prior to taking, suffering or omitting
any action hereunder, the Trustee (unless other evidence be herein specifically
prescribed) may, in the absence of bad faith on its part, rely upon an Officers’
Certificate;

 

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

 

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

 

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

 

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

 

Section 604            Not
Responsible for Recitals or Issuance of Securities.  The recitals contained herein and in the
Securities, except the Trustee’s certificates of authentication, shall be taken
as the statements of the Company, and the Trustee assumes no responsibility for
their correctness.  The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Securities.  The Trustee shall not be
accountable for the use or application by the Company of the Securities or the
proceeds thereof.

 

Section 605            May Hold
Securities.  The Trustee, any Paying
Agent, Securities Registrar or any other agent of the Company, in its
individual or any other capacity, may become the owner or pledgee of Securities
and, subject to Sections 608 and 613, may 

 

48

 

otherwise deal with the Company with the same rights
it would have if it were not Trustee, Paying Agent, Securities Registrar or
such other agent.

 

Section 606            Money
Held in Trust.  Money held by the
Trustee in trust hereunder need not be segregated from other funds except to
the extent required by law.  The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.

 

Section 607            Compensation
and Reimbursement.  The Company
agrees:

 

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

 

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

 

(3)           to
indemnify the Trustee (including in its individual capacity) and its officers,
directors and employees for, and to hold it harmless against, any loss,
liability or expense (including the reasonable compensation and the expenses
and disbursements of its agents and counsel) incurred without negligence or bad
faith, arising out of or in connection with the acceptance or administration of
this trust or the performance of its duties hereunder, including the reasonable
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder.  This indemnification shall
survive the termination of this Agreement.

 

To
secure the Company’s payment obligations in this Section, the Company and the
Holders agree that the Trustee shall have a lien prior to the Securities on all
money or property held or collected by the Trustee.  Such lien shall survive the satisfaction and
discharge of this Indenture.

 

When
the Trustee incurs expenses or renders services after an Event of Default
specified in Section 501(4) or 501(5) occurs, the expenses and
the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Reform Act of 1978 or a successor statute.

 

49

 

Section 608            Disqualification;
Conflicting Interests.  The Trustee
for the Securities of any series issued hereunder shall be subject to the
provisions of Section 310(b) of the Trust Indenture Act.  Nothing herein shall prevent the Trustee from
filing with the Commission the application referred to in the second to last
paragraph of Section 310(b) of the Trust Indenture Act.  To the extent permitted by the Trust
Indenture Act, the Trustee shall not be deemed to have a conflicting interest
by virtue of being a trustee under this Indenture with respect to Securities of
more than one series, or by virtue of being a Trustee under this Indenture and
under [(i) the Indenture dated as
of October 11, 2006 between the Company and the Bank of New York, as
Trustee or (ii)                                       ].

 

Section 609            Corporate
Trustee Required; Eligibility.  There
shall at all times be a Trustee hereunder which shall be:

 

(A)          a
corporation organized and doing business under the laws of the United States of
America or of any State, Territory or the District of Columbia, authorized
under such laws to exercise corporate trust powers and subject to supervision
or examination by Federal, State, Territorial or District of Columbia
authority, or

 

(B)           a
corporation or other Person organized and doing business under the laws of a
foreign government that is permitted to act as Trustee pursuant to a rule,
regulation or order of the Commission, authorized under such laws to exercise
corporate trust powers, and subject to supervision or examination by authority
of such foreign government or a political subdivision thereof substantially
equivalent to supervision or examination applicable to United States
institutional trustees,

 

in
either case having a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by Federal or State authority.  If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then, for the purpose of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published.  If at any time
the Trustee shall cease to be eligible in accordance with the provisions of
this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article. 
Neither the Company nor any Person directly or indirectly controlling,
controlled by or under common control with the Company shall serve as Trustee
for the Securities of any series issued hereunder.

 

50

 

Section 610            Resignation
and Removal; Appointment of Successor.

 

(a)           No
resignation or removal of the Trustee and no appointment of a successor Trustee
pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee under Section 611.

 

(b)           The
Trustee may resign at any time with respect to the Securities of one or more
series by giving written notice thereof to the Company.  If an instrument of acceptance by a successor
Trustee shall not have been delivered to the Trustee within 30 days after the
giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee with
respect to the Securities of such series.

 

(c)           The
Trustee may be removed at any time with respect to the Securities of any series
by Act of the Holders of a majority in principal amount of the Outstanding
Securities of such series, delivered to the Trustee and to the Company.

 

(d)           If
at any time:

 

(1)           the
Trustee shall fail to comply with Section 608 after written request
therefor by the Company or by any Holder who has been a bona fide Holder of a
Security for at least six months, or

 

(2)           the
Trustee shall cease to be eligible under Section 609 and shall fail to
resign after written request therefor by the Company or by any such Holder, or

 

(3)           the
Trustee shall become incapable of acting or shall be adjudged 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, (i) the Company by Board Resolution may remove
the Trustee, or (ii) subject to Section 514, any Holder who
has been a bona fide Holder of a Security for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.

 

(e)           If
the Trustee shall resign, be removed or become incapable of acting, or if a
vacancy shall occur in the office of Trustee for any cause with respect to the
Securities of one or more series, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee with respect to the Securities of that or
those series.  If, within one year after
such resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any series shall be
appointed by Act of 

 

51

 

the Holders of a majority in principal amount of the
Outstanding Securities of such series delivered to the Company and the retiring
Trustee, the successor Trustee so appointed shall, forthwith upon its
acceptance of such appointment, become the successor Trustee with respect to
the Securities of such series and supersede the successor Trustee appointed by
the Company.  If no successor Trustee
with respect to the Securities of any series shall have been so appointed by
the Company or the Holders and accepted appointment in the manner hereinafter
provided, any Holder who has been a bona fide Holder of a Security for at least
six months may, subject to Section 514, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.

 

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

 

Section 611            Acceptance
of Appointment by Successor.

 

(a)           In
case of the appointment hereunder of a successor Trustee with respect to all
Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder.

 

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

 

52

 

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

 

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

 

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

 

Section 612            Merger,
Conversion, Consolidation or Succession to Business.  Any corporation into which the Trustee may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion 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, shall be the successor of the
Trustee hereunder, provided such corporation shall be otherwise qualified and
eligible under this Article, without the execution or filing of any paper or
any further act on the part of any of the parties hereto.  In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated, and in case
any Securities shall not have been authenticated, any successor to the Trustee
may authenticate such Securities either in the name of any predecessor Trustee
or in the name of such successor Trustee, and in all cases the certificate of
authentication shall have the full force which it is provided anywhere in the
Securities or in this Indenture that the certificate of the Trustee shall have.

 

Section 613            Preferential
Collection of Claims Against Company. 
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor upon the 

 

53

 

Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims
against the Company (or any such other obligor).

 

Section 614            Appointment
of Authenticating Agent.  The Trustee
may appoint an Authenticating Agent or Agents with respect to one or more
series of Securities which shall be authorized to act on behalf of the Trustee
to authenticate Securities of such series issued upon original issue and upon
exchange, registration of transfer or partial redemption thereof, and
Securities so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder.  Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee’s certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent.  Each
Authenticating Agent shall be acceptable to the Company and shall at all times
be a corporation organized and doing business under the laws of the United
States of America, or of any State, Territory or the District of Columbia,
authorized under such laws to act as Authenticating Agent, having a combined
capital and surplus of not less than $50,000,000 and subject to supervision or
examination by Federal or State authority. 
If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section the combined
capital and surplus of such Authenticating Agent shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published.  If at any time
an Authenticating Agent shall cease to be eligible in accordance with the provisions
of this Section, such Authenticating Agent shall resign immediately in the
manner and with the effect specified in this Section.

 

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

 

An
Authenticating Agent may resign at any time by giving written notice thereof to
the Trustee and to the Company.  The
Trustee may at any time terminate the agency of an Authenticating Agent by
giving written notice thereof to such Authenticating Agent and to the Company.  Upon receiving such a notice of resignation
or upon such a termination, or in case at any time such Authenticating Agent
shall cease to be eligible in accordance with the provisions of this Section,
the Trustee may appoint a successor Authenticating Agent which shall be
acceptable to the Company and shall give notice of such appointment in the
manner provided in Section 106 to all Holders of Securities of 

 

54

 

the series with
respect to which such Authenticating Agent will serve.  Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all the
rights, powers and duties of its predecessor hereunder, with like effect as if
originally named as an Authenticating Agent. 
No successor Authenticating Agent shall be appointed unless eligible
under the provision of this Section.

 

The
Trustee agrees to pay to each Authenticating Agent from time to time reasonable
compensation for its services under this Section, and the Trustee shall be
entitled to be reimbursed for such payments, subject to the provisions of Section 607.

 

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

 

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

 

 

	
   

  	
  Wilmington Trust Company, as Trustee

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  As Authenticating Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
					

 

ARTICLE SEVEN

Holders’ Lists and Reports by Trustee and Company

 

Section 701            Company
to Furnish Trustee Names and Addresses of Holders.  The Company will furnish or cause to be
furnished to the Trustee:

 

(A)          semi-annually,
not more than 15 days after February 15 and August 15, a list, in
such form as the Trustee may reasonably require, of the names and addresses of
the Holders as of such February 1 and August 1, and

 

(B)           at
such other times as the Trustee may request in writing, within 30 days after
the receipt by the Company of any such request, a list of similar form 

 

55

 

and content as of a date not more than 15 days prior
to the time such list is furnished, excluding from any such list names and
addresses received by the Trustee in its capacity as Securities Registrar.

 

Section 702            Preservation
of Information, Communications to Holders.

 

(a)           The
Trustee shall preserve, in as current a form as is reasonably practicable, the
names and addresses of Holders contained in the most recent list furnished to
the Trustee as provided in Section 701 and the names and addresses of
Holders received by the Trustee in its capacity as Securities Registrar.  The Trustee may destroy any list furnished to
it as provided in Section 701 upon receipt of a new list so furnished.

 

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

 

(c)           Every
Holder of Securities, by receiving and holding the same, agrees with the
Company and the Trustee that neither the Company nor the Trustee nor any agent
of either of them shall be held accountable by reason of the disclosure of
information as to the names and addresses of the Holders made pursuant to the
Trust Indenture Act.

 

Section 703            Reports
by Trustee.

 

(a)           The
Trustee shall transmit to Holders such reports 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.

 

(b)           Reports
so required to be transmitted at stated intervals of not more than 12 months shall
be transmitted no later than July 15 in each calendar year, commencing
with the first July 15 after the first issuance of Securities under this
Indenture.

 

(c)           A
copy of each such report shall, at the time of such transmission to Holders, be
filed by the Trustee with each stock exchange upon which the Securities are
listed and also with the Commission.  The
Company will notify the Trustee whenever the Securities are listed on any stock
exchange.

 

Section 704            Reports
by Company.  The Company shall:

 

(1)           file
with the Trustee and with the Commission, and transmit to Holders, such
information, documents and other reports, and such summaries thereof, as may be
required pursuant to the Trust Indenture Act at the times and in the manner
provided in the Trust Indenture Act; provided that any such 

 

56

 

information, documents or reports required to be filed
with the Commission pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 shall be filed with the Trustee within 15
days after the same is filed with the Commission.  Notwithstanding that the Company may not be
required to remain subject to the reporting requirements of Section 13 or
15(d) of the Securities Exchange Act of 1934, the Company shall file with
the Trustee and the Commission, in accordance with rules and regulations
prescribed from time to time by the Commission, such of the supplementary and
periodic information, documents and reports which may be required pursuant to Section 13
of the Exchange Act in respect of a security listed and registered on a
national securities exchange as may be prescribed from time to time in such rules and
regulations.  All reports, information
and documents described in this paragraph 704(1) and filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
(EDGAR) system or any successor system shall be deemed to be filed with the
Trustee.  The Company also shall at all
times comply with the provisions of Section 314(a) of the Trust
Indenture Act;

 

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

 

(3)           transmit
by mail, to all Holders, as their names and addresses appear in the Security
Register, within 30 days after the filing thereof with the Trustee, such
summaries of any information, documents and reports required to be filed by the
Company pursuant to Clauses (1) and (2) of this Section as may
be required by rules and regulations prescribed from time to time by the
Commission.

 

ARTICLE EIGHT

Consolidation, Merger, Conveyance, Transfer or Lease

 

Section 801            Company
May Consolidate, Etc., Only on Certain Terms.  The Company shall not consolidate with or
merge into any other corporation or convey, transfer or lease its properties
and assets substantially as an entirety to any Person, and no Person shall
consolidate with or merge into the Company or convey, transfer or lease its
properties and assets substantially as an entirety to the Company, unless:

 

(1)           in
case the Company shall consolidate with or merge into another corporation or
convey, transfer or lease its properties and assets substantially as an
entirety to any Person, the corporation formed by such consolidation or into
which the Company is merged or the Person which acquires by conveyance or 

 

57

 

transfer, or which leases, the properties and assets
of the Company substantially as an entirety shall be a corporation organized
and existing under the laws of the United States of America or any State or the
District of Columbia, and shall expressly 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 (and premium, if any)
and interest (including any Additional Interest) on all the Securities and the
performance of every covenant of this Indenture on the part of the Company to
be performed or observed;

 

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

 

(3)           in
the case of the Securities of a series issued to a Principal Trust, such
consolidation, merger, conveyance, transfer or lease is permitted under the
related Trust Agreement and Principal Guarantee and does not give rise to any
breach or violation of the related Trust Agreement or Principal Guarantee; and

 

(4)           the
Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel each stating that such consolidation, merger, conveyance, transfer or
lease and any such supplemental indenture complies with this Article and
that all conditions precedent herein provided for relating to such transaction
have been complied with; and the Trustee, subject to Section 601, may rely
upon such Officers’ Certificate and opinion of Counsel as conclusive evidence
that such transaction complies with this Section 801.

 

Section 802            Successor
Corporation Substituted.  Upon any
consolidation or merger by the Company with or into any other corporation, or
any conveyance, transfer or lease by the Company of its properties and assets
substantially as an entirety to any Person in accordance with Section 801,
the successor corporation formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
corporation had been named as the Company herein; and in the event of any such
conveyance, transfer or lease the Company shall be discharged from all
obligations and covenants under the Indenture and the Securities and may be
dissolved and liquidated.

 

Such
successor corporation may cause to be signed, and may issue either in its own
name or in the name of the Company, any or all of the Securities issuable
hereunder which theretofore shall not have been signed by the Company and
delivered to the Trustee; and, upon the order of such successor corporation
instead of the Company and subject to all the terms, conditions and limitations
in this Indenture prescribed, the Trustee shall authenticate and shall deliver
any Securities which previously shall have 

 

58

 

been signed and
delivered by the officers of the Company to the Trustee for authentication
pursuant to such provisions and any Securities which such successor corporation
thereafter shall cause to be signed and delivered to the Trustee on its behalf
for the purpose pursuant to such provisions. 
All the Securities so issued shall in all respects have the same legal
rank and benefit under this Indenture as the Securities theretofore or
thereafter issued in accordance with the terms of this Indenture as though all
of such Securities had been issued at the date of the execution hereof.

 

In
case of any such consolidation, merger, sale, conveyance or lease, such changes
in phraseology and form may be made in the Securities thereafter to be issued
as may be appropriate.

 

ARTICLE NINE

 

Supplemental Indentures

 

Section 901            Supplemental
Indentures Without Consent of Holders. 
Without the consent of any Holders, the Company and, if applicable, the
Subsidiary Guarantor, in each case when authorized by a Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental hereto or, if applicable, into agreements supplemental
to any Subsidiary Guarantee, in form satisfactory to the Trustee, for any of
the following purposes:

 

(1)           to
evidence the succession of another Person to the Company, and the assumption by
any such successor of the covenants of the Company herein and in the Securities
or, if applicable, to evidence the succession of another Person to the
Subsidiary Guarantor and the assumption by any such successor of the Subsidiary
Guarantor’s obligations under any Subsidiary Guarantee (in either case with
such changes herein and therein as may be necessary or advisable to reflect
such Person’s legal status, if such Person is not a corporation); or

 

(2)           to
convey, transfer, assign, mortgage or pledge any property to or with the
Trustee or to surrender any right or power herein conferred upon the Company;
or

 

(3)           to
establish the form or terms of Securities of any series as permitted by
Sections 201 or 301; or

 

(4)           to
add to the covenants of the Company or the Subsidiary Guarantor for the benefit
of the Holders of all or any series of Securities (and if such covenants are to
be for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such series)
or to surrender any right or power herein conferred upon the Company or the
Subsidiary Guarantor; or

 

59

 

(5)           to
add any additional Events of Default; or

 

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

 

(7)           to
cure any ambiguity, to correct or supplement any provision herein, in any
Securities or in any Subsidiary Guarantee, which may be inconsistent with any
other provision herein, or to make any other provisions with respect to matters
or questions arising under this Indenture, provided that such action pursuant
to this clause (7) shall not materially adversely affect the interest
of the Holders of Securities of any series or, in the case of the Securities of
a series issued to a Principal Trust and for so long as any of the
corresponding series of Preferred Securities shall remain outstanding, the
holders of such Preferred Securities; or

 

(8)           to
evidence and provide for the acceptance of appointment hereunder by a successor
Trustee with respect to the Securities of one or more series and to add to or
change any of the provisions of this Indenture as shall be necessary to provide
for or facilitate the administration of the trusts hereunder by more than one
Trustee, pursuant to the requirements of Section 611(b); or

 

(9)           to
comply with the requirements of the Commission in order to effect or maintain
the qualification of this Indenture or any Subsidiary Guarantee under the Trust
Indenture Act or otherwise as necessary to comply with applicable law.

 

Section 902            Supplemental
Indentures With Consent of Holders. 
With the consent of the Holders of not less than a majority in principal
amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company, the
Subsidiary Guarantor and the Trustee, the Company and, if applicable, the
Subsidiary Guarantor, in each case when authorized by a Board Resolution, and
the Trustee may enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders of Securities of such series under this
Indenture and, if applicable, the Subsidiary Guarantor and the Trustee may
enter into an agreement or agreements supplemental hereto to add to or to
change or eliminate any provisions of a Subsidiary Guarantee; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,

 

(1)           except
to the extent permitted by Section 311 or as otherwise specified as
contemplated by Section 301 with respect to the extension of the 

 

60

 

interest payment period of the Securities of any
series, change the Stated Maturity of the principal of, or any installment of
interest (including any Additional Interest) on, any Security, or reduce the
principal amount thereof or the rate of interest thereon or reduce any premium
payable upon the redemption thereof, or reduce the amount of principal of an
Original Issue Discount Security that would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section 502,
or change the place of payment where, or the coin or currency in which, any
Security or interest thereon is payable, or impair the right to institute suit
for the enforcement of any such payment on or after the Stated Maturity thereof
(or, in the case of redemption, on or after the date fixed for redemption
thereof), or

 

(2)           reduce
the percentage in principal amount of the Outstanding Securities of any series,
the consent of whose Holders is required for any such supplemental indenture,
or the consent of whose Holders is required for any waiver (of compliance with
certain provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture, or

 

(3)           modify
any of the provisions of this Section, Section 513 or Section 1006,
except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent of
the Holder of each Security affected thereby; or

 

(4)           modify
the provisions in Article Twelve of this Indenture with respect to the
subordination of Outstanding Securities of any series in a manner adverse to
the Holders thereof;

 

provided
that, in the case of the Securities of a series issued to a Principal Trust, so
long as any of the corresponding series of Preferred Securities remains
outstanding, no such amendment shall be made that adversely affects the holders
of such Preferred Securities, and no termination of this Indenture shall occur,
and no waiver of any Event of Default or compliance with any covenant under
this Indenture shall be effective, without the prior consent of the holders of
at least a majority of the aggregate liquidation preference of such Preferred
Securities then outstanding unless and until the principal (and premium, if
any) of the Securities of such series and all accrued and unpaid interest
(including any Additional Interest) thereon have been paid in full; and provided
further that in the case of the Securities of a series issued to a
Principal Trust, so long as any of the corresponding series of Preferred
Securities remain outstanding, no amendment shall be made to Section 508
of this Indenture without the prior consent of the holders of each Preferred
Security then outstanding unless and until the principal (and premium, if any)
of the Securities of such series and all accrued and (subject to Section 307)
unpaid interest (including any Additional Interest) thereon have been paid in
full.

 

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

 

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

 

Section 903            Execution
of Supplemental Indentures.  In
executing or accepting the additional trusts created by any supplemental
indenture permitted by this Article or the modifications thereby of the
trusts created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 601) shall be fully protected in relying upon, an
Officers’ Certificate and an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture, and
that all conditions precedent have been complied with.  The Trustee may, but shall not be obligated
to, enter into any such supplemental indenture which affects the Trustee’s own
rights, duties or immunities under this Indenture or otherwise.

 

Section 904            Effect
of Supplemental Indentures.  Upon the
execution of any supplemental indenture under this Article, this Indenture
shall be modified in accordance therewith, and such supplemental indenture
shall form a part of this Indenture for all purposes; and every Holder of
Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.

 

Section 905            Conformity
with Trust Indenture Act.  Every
supplemental indenture executed pursuant to this Article shall conform to
the requirements of the Trust Indenture Act as then in effect.

 

Section 906            Reference
in Securities to Supplemental Indentures. 
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any
matter provided for in such supplemental indenture.  If the Company shall so determine, new
Securities of any series so modified as to conform, in the opinion of the
Trustee and the Board of Directors, to any such supplemental indenture may be
prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.

 

62

 

ARTICLE TEN

Covenants

 

Section 1001          Payment
of Principal, Premium and Interest. 
The Company covenants and agrees for the benefit of each series of
securities that it will duly and punctually pay the principal of (and premium,
if any) and interest on the Securities of that series in accordance with the
terms of such Securities and this Indenture.

 

Section 1002          Maintenance
of Office or Agency.  The Company
will maintain in each Place of Payment for any series, an office or agency
where Securities of that series may be presented or surrendered for payment and
an office or agency where Securities may be surrendered for transfer or
exchange and where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served. 
The Company initially appoints the Trustee, acting through its Corporate
Trust Office, as its agent for said purposes. 
The Company will give prompt written notice to the Trustee of any change
in the location of any such office or agency. 
If at any time the Company shall fail to maintain such 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 of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.

 

The
Company may also from time to time designate one or more other offices or
agencies where the Securities may be presented or surrendered for any or all of
such purposes, and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in each
Place of Payment for Securities of any series for such purposes.  The Company will give prompt written notice
to the Trustee of any such designation and any change in the location of any
such office or agency.

 

Section 1003          Money
for Security Payments to be Held in Trust. 
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of (and premium, if any) or interest on any of the Securities of such
series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal (and premium, if any) or interest
so becoming due until such sums shall be paid to such Persons or otherwise
disposed of as herein provided, and will promptly notify the Trustee of its
failure so to act.

 

Whenever
the Company shall have one or more Paying Agents, it will, prior to each due
date of the principal of or interest on any Securities, deposit with a Paying
Agent a sum sufficient to pay the principal (and premium, if any) or interest
so becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal 

 

63

 

and premium (if
any) or interest, and (unless such Paying Agent is the Trustee) the Company
will promptly notify the Trustee of its failure so to act.

 

The
Company will cause each Paying Agent other than the Trustee to execute and
deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section, that such Paying
Agent will:

 

(1)           hold
all sums held by it for the payment of the principal of (and premium, if any)
or interest on Securities in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise disposed of
as herein provided;

 

(2)           give
the Trustee notice of any default by the Company (or any other obligor upon the
Securities) in the making of any payment of principal (and premium, if any) or
interest;

 

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

 

(4)           comply
with the provisions of the Trust Indenture Act applicable to it as a Paying
Agent.

 

The
Company may at any time, for the purpose of obtaining the satisfaction and
discharge of this Indenture or for any other purpose, pay, or by Company Order
direct any Paying Agent to pay, to the Trustee all sums held in trust by the
Company or such Paying Agent, such sums to be held by the Trustee upon the same
trusts as those upon which such sums were held by the Company or such Paying
Agent; and, upon such payment by the Company or any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.

 

Any
money deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of (and premium, if any) or
interest on any Security and remaining unclaimed for two years after such
principal (and premium, if any) or interest has become due and payable shall
(unless otherwise required by mandatory provision of applicable escheat or
abandoned or unclaimed property law) be paid on Company Request to the Company,
or (if then held by the Company) shall (unless otherwise required by mandatory
provision of applicable escheat or abandoned or unclaimed property law) be
discharged from such trust; and the Holder of such Security shall thereafter,
as an unsecured general creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such
trust money, and all liability of the Company as trustee thereof, shall
thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in a 

 

64

 

newspaper
published in the English language, customarily published on each Business Day
and of general circulation in the [Borough of Manhattan, The City of New York],
notice that such money remains unclaimed and that, after a date specified
therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid
the Company.

 

Section 1004          Payment
of Taxes and Other Claims.  The
Company will pay or discharge or cause to be paid or discharged, before the
same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Restricted
Subsidiary or upon the income, profits or property of the Company or any
Restricted Subsidiary, and (2) all lawful claims for labor,
materials and supplies which, if unpaid, might by law become a lien upon the
property of the Company or any Restricted Subsidiary; provided, however,
that the Company shall not be required to pay or discharge or cause to be paid
or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.

 

Section 1005          Statement
as to Compliance.  The Company shall
deliver to the Trustee, within 120 days after the end of each calendar year of
the Company ending after the date hereof, an Officers’ Certificate covering the
preceding fiscal year, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance, observance or
fulfillment of or compliance with any of the terms, provisions, covenants and
conditions of this Indenture, and if the Company shall be in default,
specifying all such defaults and the nature and status thereof of which they
may have knowledge.  For the purpose of
this Section 1005, compliance shall be determined without regard to any
grace period or requirement of notice provided pursuant to the terms of this
Indenture.

 

Section 1006          Waiver
of Certain Covenants.  The Company
may omit in any particular instance to comply with any covenant or condition
set forth in Section 1004 or as specified as contemplated by Section 301
with respect to the Securities of any series, if before or after the time for
such compliance the Holders of at least a majority in principal amount of the
Outstanding Securities of such series shall, by Act of such Holders, either
waive such compliance in such instance or generally waive compliance with such
covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company in respect of any
such covenant or condition shall remain in full force and effect.

 

Section 1007          Additional
Sums.  In the case of the Securities
of a series issued to a Principal Trust, except as otherwise specified as
contemplated by Section 301, in the event that (i) a Principal
Trust is the Holder of all of the Outstanding Securities of such series, (ii) a
Tax Event in respect of such Principal Trust shall have occurred and be
continuing and (iii) the Company shall not have (i) redeemed
the Securities of such series 

 

65

 

pursuant to Section 1107(b) or (ii) terminated
such Principal Trust pursuant to section 902(b) of the related Trust
Agreement, the Company shall pay to such Principal Trust (and its permitted
successors or assigns under the related Trust Agreement) for so long as such Principal
Trust (or its permitted successor or assignee) is the registered holder of any
Securities of such series, such additional amounts as may be necessary in order
that the amount of distributions (including any Additional Amounts (as defined
in the Trust Agreement)) then due and payable by such Principal Trust on the
related Preferred Securities and Common Securities that at any time remain
outstanding in accordance with the terms thereof shall not be reduced as a
result of any Additional Taxes (the “Additional Sums”); provided
that, if this Indenture has not been qualified under the Trust Indenture Act,
the Company shall be required to pay such Additional Sums until this Indenture
is so qualified.  Whenever in this
Indenture or the Securities there is a reference in any context to the payment
of principal of or interest on the Securities, such mention shall be deemed to
include mention of the payments of the Additional Sums provided for in this
paragraph to the extent that, in such context, Additional Sums are, were or
would be payable in respect thereof pursuant to the provisions of this
paragraph and express mention of the payment of Additional Sums (if applicable)
in any provisions hereof shall not be construed as excluding Additional Sums in
those provisions hereof where such express mention is not made, provided,
however, that the extension of an interest payment period pursuant to Section 311
of the Securities shall not extend the payment of any Additional Sums that may
be due and payable during such interest payment period.

 

Section 1008          Additional
Covenants.  The Company covenants and
agrees with each Holder of Securities of a series issued to a Principal Trust
that it will not, and it will not permit any Subsidiary of the Company to, (a) declare
or pay any dividends or distributions on, or redeem, purchase, acquire or make
a liquidation payment with respect to, any shares of the Company’s capital
stock, or (b) make any payment of principal, interest or premium,
if any, on or repay, repurchase or redeem any debt securities that rank pari
passu with or junior to the Securities of such series or make any
guarantee payments with respect to the foregoing (other than (a) dividends
or distributions in common stock of the Company, (b) redemptions or
purchases of any rights pursuant to the Company’s Rights Plan, or any successor
to such Rights Plan, and the declaration of a dividend of such rights in the
future, and (c) payments under any Principal Guarantee) if at such
time (i) there shall have occurred any event of which the Company
has actual knowledge that (a) with the giving of notice or the
lapse of time or both, would constitute an Event of Default hereunder and (b) in
respect of which the Company shall not have taken reasonable steps to cure, (ii) the
Company shall be in default with respect to its payment of any obligations
under the related Principal Guarantee or (iii) the Company shall
have given notice of its selection of an Extension Period as provided herein
and shall not have rescinded such notice, or such period, or any extension
thereof, shall be continuing.

 

66

 

The
Company also covenants with each Holder of Securities of a series issued to a
Principal Trust (i) to maintain directly or indirectly 100%
ownership of the Common Securities of such Principal Trust; provided, however,
that any permitted successor of the Company hereunder may succeed to the
Company’s ownership of such Common Securities, (ii) not to
voluntarily terminate, wind-up or liquidate such Principal Trust, except (a) in
connection with a distribution of the Securities of such series to the holders
of Preferred Securities in liquidation of such Principal Trust or (b) in
connection with certain mergers, consolidations or amalgamations permitted by
the related Trust Agreement and (iii) to use its reasonable
efforts, consistent with the terms and provisions of such Trust Agreement, to
cause such Principal Trust to remain a business trust and not to be classified
as an association taxable as a corporation for United States federal income tax
purposes.

 

ARTICLE ELEVEN

 

Redemption of
Securities

 

Section 1101          Applicability
of This Article.  Redemption of
Securities (whether by operation of a sinking fund or otherwise) as permitted
or required by any form of Security issued pursuant to this Indenture shall be
made in accordance with such form of Security and this Article; provided,
however, that if any provision of any such form of Security shall
conflict with any provision of this Article, the provision of such form of
Security shall govern.  Except as
otherwise set forth in the form of Security for such series, each Security
shall be subject to partial redemption only in the amount of $25 or, in the
case of the Securities of a series issued to a Principal Trust, $25, or
integral multiples thereof.

 

Section 1102          Election
to Redeem; Notice to Trustee.  The
election of the Company to redeem any Securities shall be evidenced by or
pursuant to a Board Resolution.  In case
of any redemption at the election of the Company of less than all of the
Securities of any particular series and having the same terms, the Company
shall, not less than 30 nor more than 60 days prior to the date fixed for
redemption (unless a shorter notice shall be satisfactory to the Trustee),
notify the Trustee of such date and of the principal amount of Securities of
that series to be redeemed.  In the case
of any redemption of Securities prior to the expiration of any restriction on
such redemption provided in the terms of such Securities, the Company shall
furnish the Trustee with an Officers’ Certificate and an Opinion of Counsel
evidencing compliance with such restriction.

 

Section 1103          Selection
of Securities to be Redeemed.  If
less than all the Securities of a particular series and having the same terms
are to be redeemed, the Trustee shall select, not more than 60 days prior to
the date fixed for redemption, in such manner as in its sole discretion it
shall deem appropriate and fair, the Securities or portions thereof of such
series to be redeemed.  The Trustee shall
promptly notify the 

 

67

 

Company in writing of the Securities selected for
partial redemption and the principal amount thereof to be redeemed.  For all purposes of this Indenture, unless
the context otherwise requires, all provisions relating to the redemption of
Securities shall relate, in the case of any Security redeemed or to be redeemed
only in part, to the portion of the principal amount of such Security which has
been or is to be redeemed.  If the
Company shall so direct, Securities registered in the name of the Company, any
Affiliate or any Subsidiary thereof shall not be included in the Securities
selected for redemption.

 

Section 1104          Notice
of Redemption.  Unless otherwise
specified as contemplated by Section 301 with respect to Securities of a
particular series, notice of redemption shall be given by first-class mail,
postage prepaid, mailed not later than the thirtieth day, and not earlier than
the sixtieth day, prior to the date fixed for redemption, to each Holder of
Securities to be redeemed, at the address of such Holder as it appears in the
Securities Register.

 

With
respect to Securities of each series to be redeemed, each notice of redemption
shall state:

 

(A)          the
date fixed for redemption for Securities of such series;

 

(B)           the
redemption price at which Securities of such series are to be redeemed;

 

(C)           if
less than all Outstanding Securities of such particular series and having the
same terms are to be redeemed, the identification (and, in the case of partial
redemption, the respective principal amounts) of the particular Securities to
be redeemed;

 

(D)          that
on the date fixed for redemption, the redemption price at which such Securities
are to be redeemed will become due and payable upon each such Security or
portion thereof, and that interest thereon, if any, shall cease to accrue on
and after said date;

 

(E)           the
place or places where such Securities are to be surrendered for payment of the
redemption price at which such Securities are to be redeemed; and

 

(F)           that
the redemption is for a sinking fund, if such is the case.

 

Notice
of redemption of Securities to be redeemed at the election of the Company shall
be given by the Company or, at the Company’s request, by the Trustee in the
name and at the expense of the Company. 
The notice if mailed in the manner herein provided shall be conclusively
presumed to have been duly given, whether or not the Holder receives such
notice.  In any case, a failure to give
such notice by mail or any defect in 

 

68

 

the notice to the
Holder of any Security designated for redemption as a whole or in part shall
not affect the validity of the proceedings for the redemption of any other
Security.

 

Section 1105          Deposit
of Redemption Price.  Prior to the
redemption date specified in the notice of redemption given as provided in Section 1104,
the Company will deposit with the Trustee or with one or more paying agents an
amount of money sufficient to redeem on the redemption date all the Securities
so called for redemption at the applicable redemption price.

 

Section 1106          Payment
of Securities Called for Redemption. 
If any notice of redemption has been given as provided in Section 1104,
the Securities or portion of Securities with respect to which such notice has
been given shall become due and payable on the date and at the place or places
stated in such notice at the applicable redemption price.  On presentation and surrender of such
Securities at a place of payment in said notice specified, the said securities
or the specified portions thereof shall be paid and redeemed by the Company at
the applicable redemption price.

 

Upon
presentation of any Security redeemed in part only, the Company shall execute
and the Trustee shall authenticate and deliver to the Holder thereof, at the
expense of the Company, a new Security or Securities of the same series, of
authorized denominations, in aggregate principal amount equal to the unredeemed
portion of the Security so presented and having the same Original Issue Date,
Stated Maturity and terms.  If a Global
Security is so surrendered, such new Security will also be a new Global
Security.

 

Section 1107          Company’s
Right of Redemption.

 

(a)           Unless
otherwise specified as contemplated by Section 301 with respect to the
Securities of a particular series and notwithstanding any additional redemption
rights that may be so specified, the Company may, at its option, redeem the
Securities of any series after their date of issuance in whole or in part at
any time and from time to time, subject to the provisions of this clause (a) and
the other provisions of this Article Eleven.  Unless otherwise specified as contemplated by
Section 301 with respect to the Securities of a particular series, the
redemption price for any Security so redeemed pursuant to this clause (a) shall
equal any accrued and unpaid interest, including any Additional Interest, to
the date fixed for redemption, plus the greater of (a) the principal
amount thereof and (b) an amount equal to (i) in
respect of the Securities of any series bearing interest at a fixed rate, the
Discounted Remaining Fixed Amount Payments or (ii) in respect of
the Securities of any series bearing interest determined by reference to a
floating rate, the Discounted Swap Equivalent Payments.  The Company shall not redeem the Securities
in part unless all accrued and unpaid interest (including any Additional
Interest) has been paid in full on all Securities Outstanding for all interest
periods terminating on or prior to the date fixed for redemption.  For purposes of this clause (a), the
following terms shall have the meanings set forth below:

 

69

 

“Discounted
Remaining Fixed Amount Payments” means, in respect of a Security of any
series bearing interest at a fixed rate, an amount equal to the sum of the
Current Values of the amounts of interest and principal that would have been
payable by the Company pursuant to the terms of such Security on each Interest
Payment Date after the date fixed for redemption pursuant to this Section 1107
and at the Stated Maturity of the final payment of principal thereof (taking
into account any required sinking fund payments but otherwise assuming that the
Company had not redeemed such Security prior to such Stated Maturity).

 

“Current
Value” means, in respect of any amount, the present value of that amount on
the date fixed for redemption pursuant to this Section 1107 after
discounting that amount on a basis corresponding to the interest period of the
Securities to be redeemed from the originally scheduled date for payment on the
basis of the Treasury Rate, all computed in accordance with generally accepted
financial practice.

 

“Treasury
Rate” means a per annum rate (expressed as a decimal and, in the case of
United States Treasury bills, converted to a per annum yield) determined on the
date fixed for redemption pursuant to this Section 1107 to be the per
annum rate equal to the semiannual bond equivalent yield to maturity adjusted,
in the case of Securities having monthly or quarterly Interest Payment Dates,
to reflect monthly or quarterly compounding in accordance with generally
accepted financial practice for United States Treasury securities maturing at
the Stated Maturity of the final payment of principal of any series of
Securities redeemed pursuant to this Section 1107, as determined (i) by
reference to the weekly average yield to maturity for United States Treasury
securities maturing on such Stated Maturity as reported in the most recent
Statistical Release H.15(519) of the Board of Governors of the Federal Reserve,
or (ii) if no such weekly average yield is so reported, by
interpolation between the most recent weekly average yields to maturity for two
series of United States Treasury securities, (a) one maturing as
close as possible to, but earlier than, such Stated Maturity and (b) the
other maturing as close as possible to, but later than, such Stated Maturity,
in each case as published in the most recent Statistical Release H.15(519) of
the Board of Governors of the Federal Reserve.

 

“Discounted
Swap Equivalent Payments” means, in respect of a Security of any series
bearing interest determined by reference to a floating rate, an amount equal to
the sum of (i) the Current Value of the amount of principal that
would have been payable by the Company pursuant to the terms of such Security
at the Stated Maturity of the final payment of the principal thereof (taking into
effect any required sinking fund payments but otherwise assuming that the
Company had not redeemed such Security prior to such Stated Maturity) and (ii) the
sum of the Current Values of the fixed rate payments that Reference
Market-Makers would require to be paid by an assumed fixed rate payer having
the same credit standing as the Company against floating rate payments to be
made by such Reference Market-Makers equal to the interest payments on the
Security

 

70

 

being redeemed
(taking into effect any required sinking fund payments but otherwise assuming
the Company had not redeemed such Security prior to such Stated Maturity) under
an interest rate swap agreement documented under standard forms of the International
Swap Dealers Association, Inc., and having a notional principal amount
equal to the principal amount of such Security, a termination date set at the
Stated Maturity of such Security and payment dates for both fixed and floating
rate payers set at each Interest Payment Date of such Security.  The Trustee (or its agent) will request each
Reference Market-Maker to provide its quotation of such fixed rate payments to
the extent practicable as of the same time (without regard to different time
zones) on a date that is no more than five Business Days prior to the date on
which the notice of redemption required by Section 1104 is first mailed to
the Holders of the Securities being redeemed. 
If more than three such quotations are provided, the fixed rate payments
will be the arithmetic mean of the dollar equivalent of such quotations without
regard to the quotations having the highest and lowest values.  If exactly three such quotations are
provided, the fixed rate payments will be the quotation remaining after
disregarding the quotations having the highest and lowest values.

 

“Reference
Market-Makers” means four leading dealers in the market for interest rate
swaps selected by the Trustee (or its agent) in good faith from among dealers
of the highest credit standing which satisfy all the criteria that the Trustee
(or its agent) applies generally at the time in deciding whether to offer or to
make an extension of credit or, if quotations from four such leading dealers
are not reasonably obtainable, three such leading dealers.

 

(b)           In the case of the Securities of a
series issued to a Principal Trust, except as otherwise specified as
contemplated by Section 301, if a Special Event in respect of such
Principal Trust shall occur and be continuing, the Company may, at its option,
redeem the Securities of such series, in whole but not in part, subject to the
provisions of this clause (b) and the other provisions of this Article Eleven.  The redemption price for any Security so
redeemed pursuant to this clause (b) shall be equal to 100% of the
principal amount of such Securities then Outstanding plus accrued and unpaid
interest, including any Additional Interest, to the date fixed for redemption.

 

Notwithstanding
any other provision of this Article Eleven, installments of accrued and
unpaid interest whose Stated Maturity is on or prior to the Redemption Date
will be payable to the Holders of the series of Securities to be redeemed, or
one or more Predecessor Securities, registered as such at the close of business
on the relevant Regular Record Dates according to their terms and the
provisions of Section 307, unless otherwise so specified or unless in
connection with a Redemption Date falling on an Interest Payment Date, the
Securities of the particular series provide that interest payable on an
Interest Payment Date that is a Redemption Date shall be paid to the person to
whom principal is payable.

 

71

 

ARTICLE TWELVE

 

Subordination of
Securities

 

Section 1201          Securities Subordinate to Senior
Indebtedness of the Company.  The
Company covenants and agrees, and each Holder of a Security, by its acceptance
thereof, likewise covenants and agrees, that, to the extent and in the manner
hereinafter set forth in this Article, the payment of the principal of (and
premium, if any) and interest (including any Additional Interest) on each and
all of the Securities are hereby expressly made subordinate and subject in
right of payment to the prior payment in full of all amounts then due and
payable in respect of all Senior Indebtedness of the Company.  Each Holder, by its acceptance hereof, waives
all notice of acceptance of the subordination provisions contained herein by
each holder of Senior Indebtedness of the Company, whether now outstanding or
hereafter incurred and waives reliance by each such holder upon said
provisions.

 

Section 1202          Payment Over of Proceeds Upon
Dissolution, Etc.  Upon any payment
or distribution of assets to creditors upon any liquidation, dissolution,
winding up, reorganization, assignment for the benefit of creditors, marshaling
of assets or any bankruptcy, insolvency, debt restructuring or similar
proceedings in connection with the Company’s insolvency or bankruptcy (each
such event, if any, herein sometimes referred to as a “Proceeding”), the
holders of Senior Indebtedness of the Company shall be entitled to receive
payment in full of principal of (and premium, if any) and interest, if any, on
such Senior Indebtedness, or provision shall be made for such payment in cash
or cash equivalents or otherwise in a manner satisfactory to the holders of
such Senior Indebtedness, before the Holders of the Securities are entitled to
receive or retain any payment or distribution of any kind or character, whether
in cash, property or securities (including any payment or distribution which
may be payable or deliverable by reason of the payment of any other
Indebtedness of the Company (including any series of the Securities)
subordinated to the payment of the Securities, such payment or distribution
being hereinafter referred to as a “Junior Subordinated Payment”), on
account of principal of (or premium, if any) or interest (including any
Additional Interest) on the Securities or on account of the purchase or other
acquisition of Securities by the Company or any Subsidiary and to that end the
holders of Senior Indebtedness of the Company shall be entitled to receive, for
application to the payment thereof, any payment or distribution of any kind of
character, whether in cash, property or securities, including any Junior
Subordinated Payment, which may be payable or deliverable in respect of the
Securities in any such Proceeding.

 

In the
event that, notwithstanding the foregoing provisions of this Section, the
Trustee or the Holder of any Security shall have received any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, including any Junior Subordinated Payment, before
all Senior Indebtedness of the 

 

72

 

Company is paid in
full or payment thereof is provided for in cash or cash equivalents or
otherwise in a manner satisfactory to the holders of such Senior Indebtedness,
and if written notice thereof from the Company or any holder of such Senior
Indebtedness (or any trustee, agent or 
representative therefor) shall, at least three Business Days prior to
the time of such payment or distribution, have been received by a Responsible
Officer of the Trustee or, as the case may be, such Holder, then and in such
event such payment or distribution shall be paid over or delivered forthwith to
the trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee,
agent or other Person making payment or distribution of assets of the Company
for application to the payment of all Senior Indebtedness of the Company
remaining unpaid, to the extent necessary to pay all Senior Indebtedness of the
Company in full, after giving effect to any concurrent payment or distribution
to or for the holders of such Senior Indebtedness.

 

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

 

Section 1203          Prior Payment to Senior
Indebtedness of the Company Upon Acceleration of Securities.  In the event that any Securities are declared
due and payable before their Stated Maturity, then and in such event the
holders of the Senior Indebtedness of the Company outstanding at the time such
Securities so become due and payable shall be entitled to receive payment in
full of all amounts due on or in respect of such Senior Indebtedness (including
any amounts due upon acceleration), or provision shall be made for such payment
in cash or cash equivalents or otherwise in a manner satisfactory to the
holders of Senior Indebtedness of the Company, before the Holders of the
Securities are entitled to receive any payment or distribution of any kind or
character, whether in cash, properties or securities (including any Junior
Subordinated Payment) by the Company on account of the principal of (or
premium, if any) or interest (including any Additional Interest) on the
Securities or on account of the purchase or other 

 

73

 

acquisition of Securities by the Company or any
Subsidiary; provided, however, that nothing in this Section shall
prevent the satisfaction of any sinking fund payment in accordance with this
Indenture or as otherwise specified as contemplated by Section 301 for the
Securities of any series by delivering and crediting as contemplated by Section 301
for the Securities of any series Securities which have been acquired (upon
redemption or otherwise) prior to such declaration of acceleration.

 

In the
event that, notwithstanding the foregoing, the Company shall make any payment
to the Trustee or the Holder of any Security prohibited by the foregoing
provisions of this Section, and if written notice of such fact from the Company
or any holder of Senior Indebtedness of the Company (or any trustee, agent
or  representative therefor) shall, at
least three Business Days prior to the time of such payment, have been received
by a Responsible Officer of the Trustee or, as the case may be, such Holder,
then and in such event such payment shall be paid over and delivered forthwith
to the Company.

 

The
provisions of this Section shall not apply to any payment with respect to
which Section 1202 would be applicable.

 

Section 1204          No
Payment When Senior Indebtedness of the Company in Default.

 

(a)           In the event and during the
continuation of any default in the payment of principal of (or premium, if any)
or interest on any Senior Indebtedness of the Company, or in the event that any
event of default with respect to any Senior Indebtedness of the Company shall
have occurred and be continuing and shall have resulted in such Senior
Indebtedness becoming or being declared due and payable prior to the date on
which it would otherwise have become due and payable, unless and until such
event of default shall have been cured or waived or shall have ceased to exist
and such acceleration shall have been rescinded or annulled, or (b) in
the event any judicial proceeding shall be pending with respect to any such
default in payment or such event of default, then no payment or distribution of
any kind or character, whether in cash, properties or securities (including any
Junior Subordinated Payment) shall be made by the Company on account of
principal of (or premium, if any) or interest (including any Additional
Interest), if any, on the Securities or on account of the purchase or other
acquisition of Securities by the Company or any Subsidiary; provided, however,
that nothing in this Section shall prevent the satisfaction of any sinking
fund payment in accordance with this Indenture or as otherwise specified as
contemplated by Section 301 for the Securities of any series by delivering
and crediting pursuant to Section 1202 or as otherwise specified as
contemplated by Section 301 for the Securities of any series Securities
which have been acquired (upon redemption or otherwise) prior to such default
in payment or event of default.

 

74

 

In the
event that, notwithstanding the foregoing, the Company shall make any payment
to the Trustee or the Holder of any Security prohibited by the foregoing
provisions of this Section, and if written notice thereof from the Company or
any holder of Senior Indebtedness of the Company (or any trustee, agent or  representative therefor) shall, at least
three Business Days or prior to the time of such payment, have been received by
the Trustee or, as the case may be, such Holder, then and in such event such
payment shall be paid over and delivered forthwith to the Company.

 

The
provisions of this Section shall not apply to any payment with respect to
which Section 1202 would be applicable.

 

Section 1205          Payment Permitted If No Default.  Nothing contained in this Article or
elsewhere in this Indenture or in any of the Securities shall prevent (a) the
Company, at any time except during the pendency of any Proceeding referred to
in Section 1202 or under the conditions described in Sections 1203 and
1204, from making payments at any time of principal of (and premium, if any) or
interest on the Securities, or (b) the application by the Trustee
of any money or Government Obligations deposited with it hereunder to the
payment of or on account of the principal of (and premium, if any) or interest
(including any Additional Interest) on the Securities or the retention of such
payment by the Holders, if, at least three Business Days prior to the time of
such application by the Trustee, a Responsible Officer of the Trustee did not
receive written notice from the Company or any holder of Senior Indebtedness of
the Company (or any trustee, agent or representative therefor) that such
payment would have been prohibited by the provisions of this Article.  Notwithstanding anything herein to the
contrary, money or Government Obligations held in trust pursuant to Section 402
shall not be subject to the claims of the holders of Senior Indebtedness of the
Company under this Article Twelve.

 

Section 1206          Subrogation to Rights of Holders of
Senior Indebtedness of the Company. 
Subject to the payment in full of all Senior Indebtedness of the
Company, or the provision for such payment in cash or cash equivalents or
otherwise in a manner satisfactory to the holders of such Senior Indebtedness,
the Holders of the Securities shall be subrogated to the extent of the payments
or distributions made to the holders of such Senior Indebtedness pursuant to
the provisions of this Article (equally and ratably with the holders of
all indebtedness of the Company which by its express terms is subordinated to
Senior Indebtedness of the Company to substantially the same extent as the
Securities are subordinated to such Senior Indebtedness and is entitled to like
rights of subrogation by reason of any payments or distributions made to holders
of such Senior Indebtedness) to the rights of the holders of such Senior
Indebtedness to receive payments and distributions of cash, property and
securities applicable to the Senior Indebtedness of the Company until the
principal of (and premium, if any) and interest on the Securities shall be paid
in full.  For purposes of such
subrogation or assignment, no payments or distributions to the holders of the
Senior Indebtedness of the Company of 

 

75

 

any cash, property or securities to which the Holders
of the Securities or the Trustee would be entitled except for the provisions of
this Article, and no payments over pursuant to the provisions of this Article to
the holders of such Senior Indebtedness by Holders of the Securities or the
Trustee, shall, as among the Company, its creditors other than holders of
Senior Indebtedness of the Company, and the Holders of the Securities, be
deemed to be a payment or distribution by the Company to or on account of such
Senior Indebtedness.

 

Section 1207          Provisions Solely to Define
Relative Rights.  The provisions of
this Article are and are intended solely for the purpose of defining the
relative rights of the Holders of the Securities on the one hand and the
holders of Senior Indebtedness of the Company on the other hand.  Nothing contained in this Article or
elsewhere in this Indenture or in the Securities is intended to or shall (a) impair,
as between the Company and the Holders of the Securities, the obligations of
the Company, which are absolute and unconditional, to pay to the Holders of the
Securities the principal of (and premium, if any) and interest (including any
Additional Interest) on the Securities as and when the same shall become due
and payable in accordance with their terms; or (b) affect the
relative rights against the Company of the Holders of the Securities and
creditors of the Company other than their rights in relation to the holders of
Senior Indebtedness of the Company; or (c) prevent the Trustee or
the Holder of any Security from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture including, without limitation,
filing and voting claims in any Proceeding, subject to the rights, if any,
under this Article of the holders of Senior Indebtedness of the Company to
receive cash, property and securities otherwise payable or deliverable to the
Trustee or such Holder.

 

Section 1208          Trustee to Effectuate Subordination.  Each Holder of a Security by his or her
acceptance thereof authorizes and directs the Trustee on his or her behalf to
take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination provided in this Article and appoints the
Trustee his or her attorney-in-fact for any and all such purposes.

 

Section 1209          No Waiver of Subordination
Provisions.  No right of any present
or future holder of any Senior Indebtedness of the Company to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance
by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof that any such holder may have or be
otherwise charged with.

 

Section 1210          Notice to Trustee.  The Company shall give prompt written notice
to the Trustee of any fact known to the Company which would prohibit the making
of any payment to or by the Trustee in respect of the Securities.  Notwithstanding the provisions of this Article or
any other provision of this Indenture, the Trustee shall not be charged 

 

76

 

with knowledge of the existence of any facts which
would prohibit the making of any payment to or by the Trustee in respect of the
Securities, unless and until a Responsible Officer of the Trustee shall have
received written notice thereof from the Company or a holder of Senior
Indebtedness of the Company or from any trustee, agent or representative
therefor (whether or not the facts contained in such notice are true); provided,
however, that if the Trustee shall not have received the notice provided
for in this Section at least three Business Days prior to the date upon
which by the terms hereof any monies may become payable for any purpose
(including, without limitation, the payment of the principal of (and premium,
if any) or interest (including any Additional Interest) on any Security), then,
anything herein contained to the contrary notwithstanding, the Trustee shall
have full power and authority to receive such monies and to apply the same to
the purpose for which they were received and shall not be affected by any
notice to the contrary which may be received by it within three Business Days
prior to such date.

 

Section 1211          Reliance on Judicial Order or
Certificate of Liquidating Agent or other Notices.  Upon any payment or distribution of assets of
the Company referred to in this Article, the Trustee, subject to the provisions
of Article Six, and the Holders of the Securities shall be entitled to
rely upon any order or decree entered by any court of competent jurisdiction in
which such Proceeding is pending, or a certificate of the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee for the benefit of
creditors, agent or other Person making such payment or distribution, delivered
to the Trustee or to the Holders of Securities, for the purpose of ascertaining
the Persons entitled to participate in such payment or distribution, the
holders of the Senior Indebtedness and other indebtedness of the Company, the
amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article.

 

The
Trustee shall be entitled to rely on the delivery to it of a written notice by
a Person representing himself to be a holder of Senior Indebtedness of the
Company (or an agent or representative of such holder or a trustee under any
indenture under which any instruments evidencing any such Senior Indebtedness
of the Company may have been issued) to establish that such notice has been
given by a holder of such Senior Indebtedness or such agent or representative
or trustee on behalf of such holder.  In
the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness of the Company to participate in any payment or distribution
pursuant to this Article Twelve, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of Senior Indebtedness of the Company held by such Person, the extent to which
such Person is entitled to participate in such payment or distribution and any
other facts pertinent to the right of such Person under this Article Twelve,
and, if such evidence is not furnished, the Trustee may defer any payment to
such Person pending 

 

77

 

judicial
determination as to the right of such Person to receive such payment or
distribution.

 

Section 1212          Trustee Not Fiduciary for Holders
of Senior Indebtedness of the Company. 
The Trustee, in its capacity as trustee under this Indenture, shall not
be deemed to owe any fiduciary duty to the holders of Senior Indebtedness of
the Company and shall not be liable to any such holders if it shall in good
faith mistakenly pay over or distribute to Holders of Securities or to the
Company or to any other Person cash, property or securities to which any
holders of Senior Indebtedness of the Company shall be entitled by virtue of
this Article or otherwise.

 

Section 1213          Rights of Trustee as Holder of
Senior Indebtedness of the Company; Preservation of Trustee’s Rights.  The Trustee in its individual capacity shall
be entitled to all the rights set forth in this Article with respect to
any Senior Indebtedness of the Company which may at any time be held by it, to
the same extent as any other holder of Senior Indebtedness of the Company, and
nothing in this Indenture shall deprive the Trustee of any of its rights as
such holder.

 

Nothing
in this Article shall apply to claims of, or payments to, the Trustee
under or pursuant to Section 607.

 

Section 1214          Article Applicable to Paying
Agents.  In case at any time any
Paying Agent other than the Trustee shall have been appointed by the Company
and be then acting hereunder, the term “Trustee” as used in this Article shall
in such case (unless the context otherwise requires) be construed as extending
to and including such Paying Agent within its meaning as fully for all intents
and purposes as if such Paying Agent were named in this Article in
addition to or in place of the Trustee.

 

Section 1215          Certain Conversions or Exchanges
Deemed Payment.  For the purposes of
this Article only, (a) the issuance and delivery of junior
securities upon conversion or exchange of Securities shall not be deemed to
constitute a payment or distribution on account of the principal of (or premium,
if any) or interest (including any Additional Interest) on Securities or on
account of the purchase or other acquisition of Securities, and (b) the
payment, issuance or delivery of cash, property or securities (other than
junior securities) upon conversion or exchange of a Security shall be deemed to
constitute payment on account of the principal of such security.  For the purposes of this Section, the term “junior
securities” means (i) shares of any stock of any class of the
Company and (ii) securities of the Company which are subordinated
in right of payment to all Senior Indebtedness of the Company which may be
outstanding at the time of issuance or delivery of such securities to
substantially the same extent as, or to a greater extent than, the Securities
are so subordinated as provided in this Article.

 

78

 

ARTICLE THIRTEEN

 

Subordination of
Subsidiary Guarantee

 

Section 1301          Subsidiary Guarantee Subordinate to
Senior Indebtedness of the Subsidiary Guarantor.  The Subsidiary Guarantor covenants and
agrees, and each Holder of a Security, by its acceptance thereof, likewise
covenants and agrees, that, to the extent and in the manner hereinafter set
forth in this Article, all payments pursuant to each and any Subsidiary
Guarantee made by or on behalf of the Subsidiary Guarantor are hereby expressly
made subordinate in right of payment to the prior payment in full of all
amounts then due and payable in respect of all Senior Indebtedness of the
Subsidiary Guarantor.  Each Holder, by
its acceptance hereof, waives all notice of acceptance of the subordination
provisions contained herein by each holder of Senior Indebtedness of the
Subsidiary Guarantor, whether now outstanding or hereafter incurred and waives
reliance by each such holder upon said provisions.

 

Section 1302          Payment Over of Proceeds Upon
Dissolution, Etc.  Upon any payment
or distribution of assets to creditors upon any liquidation, dissolution,
winding up, reorganization, assignment for the benefit of creditors, marshaling
of assets or any bankruptcy, insolvency, debt restructuring or similar
proceedings in connection with the Subsidiary Guarantor’s insolvency or
bankruptcy (each such event, if any, herein sometimes referred to as a “Proceeding”),
the holders of Senior Indebtedness of the Subsidiary Guarantor shall be
entitled to receive payment in full of principal of (and premium, if any) and
interest, if any, on such Senior Indebtedness, or provision shall be made for
such payment in cash or cash equivalents or otherwise in a manner satisfactory
to the holders of such Senior Indebtedness, before the Holders of the
Securities are entitled to receive or retain any payment or distribution of any
kind or character, whether in cash, property or securities (including any
payment or distribution which may be payable or deliverable by reason of the
payment of any other Indebtedness of the Subsidiary Guarantor subordinated to
the payment of any Subsidiary Guarantee, such payment or distribution being
hereinafter referred to as a “Junior Subordinated Payment”), on account
of any payment pursuant to any Subsidiary Guarantee or on account of the
purchase or other acquisition of Securities by the Subsidiary Guarantor or any
Subsidiary and to that end the holders of Senior Indebtedness of the Subsidiary
Guarantor shall be entitled to receive, for application to the payment thereof,
any payment or distribution of any kind or character, whether in cash, property
or securities, including any Junior Subordinated Payment, which may be payable
or deliverable in respect of the Subsidiary Guarantee in any such Proceeding.

 

In the
event that, notwithstanding the foregoing provisions of this Section, the
Trustee or the Holder of any Security shall have received any payment or
distribution of assets of the Subsidiary Guarantor of any kind or character,
whether in cash, property or securities, including any Junior Subordinated
Payment, before all Senior Indebtedness of 

 

79

 

the Subsidiary
Guarantor is paid in full or payment thereof is provided for in cash or cash
equivalents or otherwise in a manner satisfactory to the holders of such Senior
Indebtedness, and if written notice thereof from the Subsidiary Guarantor or
any holder of Senior Indebtedness of the Subsidiary Guarantor (or any trustee,
agent or  representative therefor) shall,
at least three Business Days prior to the time of such payment or distribution,
have been received by a Responsible Officer of the Trustee or, as the case may
be, such Holder, then and in such event such payment or distribution shall be
paid over or delivered forthwith to the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee, agent or other Person making payment
or distribution of assets of the Subsidiary Guarantor for application to the
payment of all Senior Indebtedness of the Subsidiary Guarantor remaining
unpaid, to the extent necessary to pay all such Senior Indebtedness in full,
after giving effect to any concurrent payment or distribution to or for the
holders of Senior Indebtedness of the Subsidiary Guarantor.

 

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

 

Section 1303          Prior Payment to Senior
Indebtedness of the Subsidiary Guarantor Upon Acceleration of Securities.  In the event that any Securities are declared
due and payable before their Stated Maturity, then and in such event the
holders of the Senior Indebtedness of the Subsidiary Guarantor outstanding at
the time such Securities so become due and payable shall be entitled to receive
payment in full of all amounts due on or in respect of such Senior Indebtedness
(including any amounts due upon acceleration), or provision shall be made for
such payment in cash or cash equivalents or otherwise in a manner satisfactory
to the holders of such Senior Indebtedness, before the Holders of the
Securities are entitled to receive any payment or distribution of any kind or
character, whether in cash, properties or securities (including any Junior
Subordinated Payment) by 

 

80

 

the Subsidiary Guarantor on account of any payment
pursuant to any Subsidiary Guarantee or on account of the purchase or other
acquisition of Securities by the Subsidiary Guarantor or any Subsidiary;
provided, however, that nothing in this Section shall prevent the
satisfaction of any sinking fund payment in accordance with this Indenture or
as otherwise specified as contemplated by Section 301 for the Securities
of any series by delivering and crediting as contemplated by Section 301
for the Securities of any series Securities which have been acquired (upon
redemption or otherwise) prior to such declaration of acceleration.

 

In the
event that, notwithstanding the foregoing, the Subsidiary Guarantor shall make
any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if written notice of such fact from
the Subsidiary Guarantor or any holder of Senior Indebtedness of the Subsidiary
Guarantor (or any trustee, agent or representative therefor) shall, at least
three Business Days prior to the time of such payment, have been received by a
Responsible Officer of the Trustee or, as the case may be, such Holder, then
and in such event such payment shall be paid over and delivered forthwith to the
Subsidiary Guarantor.

 

The
provisions of this Section shall not apply to any payment with respect to
which Section 1302 would be applicable.

 

Section 1304          No Payment When Senior Indebtedness
of Subsidiary Guarantor in Default.  (a) In
the event and during the continuation of any default in the payment of
principal of (or premium, if any) or interest on any Senior Indebtedness of the
Subsidiary Guarantor, or in the event that any event of default with respect to
any Senior Indebtedness of the Subsidiary Guarantor shall have occurred and be
continuing and shall have resulted in such Senior Indebtedness becoming or
being declared due and payable prior to the date on which it would otherwise
have become due and payable, unless and until such event of default shall have
been cured or waived or shall have ceased to exist and such acceleration shall
have been rescinded or annulled, or (b) in the event any judicial
proceeding shall be pending with respect to any such default in payment or such
event of default, then no payment or distribution of any kind or character,
whether in cash, properties or securities (including any Junior Subordinated
Payment) shall be made by the Subsidiary Guarantor on account of any payment
pursuant to any Subsidiary Guarantee or on account of the purchase or other
acquisition of Securities by the Subsidiary Guarantor or any Subsidiary; provided,
however, that nothing in this Section shall prevent the
satisfaction of any sinking fund payment in accordance with this Indenture or
as otherwise specified as contemplated by Section 301 for the Securities
of any series by delivering and crediting pursuant to Section 1302 or as
otherwise specified as contemplated by Section 301 for the Securities of
any series Securities which have been acquired (upon redemption or otherwise)
prior to such default in payment or event of default.

 

81

 

In the
event that, notwithstanding the foregoing, the Subsidiary Guarantor shall make
any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if written notice thereof from the
Subsidiary Guarantor or any holder of Senior Indebtedness of the Subsidiary
Guarantor (or any trustee, agent or representative therefor) shall, at least
three Business Days prior to the time of such payment, have been received by
the Trustee or, as the case may be, such Holder, then and in such event such
payment shall be paid over and delivered forthwith to the Subsidiary Guarantor.

 

The
provisions of this Section shall not apply to any payment with respect to
which Section 1302 would be applicable.

 

Section 1305          Payment Permitted If No Default.  Nothing contained in this Article or
elsewhere in this Indenture or in any of the Securities or any Subsidiary
Guarantee shall prevent (a) the Subsidiary Guarantor, at any time
except during the pendency of any Proceeding referred to in Section 1302
or under the conditions described in Sections 1303 and 1304, from making
payments at any time pursuant to any Subsidiary Guarantee, or (b) the
application by the Trustee of any money or Government Obligations deposited
with it hereunder to the payment of or on account of any payment pursuant to
any Subsidiary Guarantee or the retention of such payment by the Holders, if,
at least three Business Days prior to the time of such application by the
Trustee, a Responsible Officer of the Trustee did not receive written notice
from the Subsidiary Guarantor or any holder of Senior Indebtedness of the
Subsidiary Guarantor (or any trustee, agent or representative therefor) that
such payment would have been prohibited by the provisions of this Article.  Notwithstanding anything herein to the
contrary, money or Government Obligations held in trust pursuant to Section 402
shall not be subject to the claims of the holders of Senior Indebtedness of the
Subsidiary Guarantor under this Article Thirteen.

 

Section 1306          Subrogation to Rights of Holders of
Senior Indebtedness of the Subsidiary Guarantor.  Subject to the payment in full of all Senior
Indebtedness of the Subsidiary Guarantor, or the provision for such payment in
cash or cash equivalents or otherwise in a manner satisfactory to the holders
of such Senior Indebtedness, the Holders of the Securities shall be subrogated
to the extent of the payments or distributions made to the holders of such
Senior Indebtedness pursuant to the provisions of this Article (equally
and ratably with the holders of all indebtedness of the Subsidiary Guarantor
which by its express terms is subordinated to Senior Indebtedness of the
Subsidiary Guarantor to substantially the same extent as the Subsidiary
Guarantee is subordinated to such Senior Indebtedness and is entitled to like
rights of subrogation by reason of any payments or distributions made to
holders of such Senior Indebtedness) to the rights of the holders of such
Senior Indebtedness to receive payments and distributions of cash, property and
securities applicable to such Senior Indebtedness until all payments due
pursuant to the Subsidiary Guarantee shall be paid in full.  For purposes 

 

82

 

of such subrogation or assignment, no payments or
distributions to the holders of the Senior Indebtedness of the Subsidiary
Guarantor of any cash, property or securities to which the Holders of the
Securities or the Trustee would be entitled except for the provisions of this
Article, and no payments over pursuant to the provisions of this Article to
the holders of Senior Indebtedness of the Subsidiary Guarantor by Holders of
the Securities or the Trustee, shall, as among the Subsidiary Guarantor, its
creditors other than holders of its Senior Indebtedness, and the Holders of the
Securities, be deemed to be a payment or distribution by the Subsidiary
Guarantor to or on account of its Senior Indebtedness.

 

Section 1307          Provisions Solely to Define
Relative Rights.  The provisions of this
Article are and are intended solely for the purpose of defining the
relative rights of the Holders of the Securities on the one hand and the
holders of Senior Indebtedness of the Subsidiary Guarantor on the other
hand.  Nothing contained in this Article or
elsewhere in this Indenture or in the Securities or in any Subsidiary Guarantee
is intended to or shall (a) impair, as between the Subsidiary
Guarantor and the Holders of the Securities, the obligations of the Subsidiary
Guarantor, which are absolute and unconditional, to pay to the Holders of the
Securities any payment pursuant to any Subsidiary Guarantee as and when the
same shall become due and payable in accordance with its terms; or (b) affect
the relative rights against the Subsidiary Guarantor of the Holders of the
Securities and creditors of the Subsidiary Guarantor other than their rights in
relation to the holders of Senior Indebtedness of the Subsidiary Guarantor; or (c) prevent
the Trustee or the Holder of any Security from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture or any
Subsidiary Guarantee including, without limitation, filing and voting claims in
any Proceeding, subject to the rights, if any, under this Article of the
holders of Senior Indebtedness of the Subsidiary Guarantor to receive cash,
property and securities otherwise payable or deliverable to the Trustee or such
Holder.

 

Section 1308          Trustee to Effectuate Subordination.  Each Holder of a Security by his or her
acceptance thereof authorizes and directs the Trustee on his or her behalf to
take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination provided in this Article and appoints the
Trustee his or her attorney-in-fact for any and all such purposes.

 

Section 1309          No Waiver of Subordination
Provisions.  No right of any present
or future holder of any Senior Indebtedness of the Subsidiary Guarantor to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the
Subsidiary Guarantor or by any act or failure to act, in good faith, by any
such holder, or by any noncompliance by the Subsidiary Guarantor with the
terms, provisions and covenants of this Indenture or any Subsidiary Guarantee,
regardless of any knowledge thereof that any such holder may have or be
otherwise charged with.

 

83

 

Section 1310          Notice to Trustee.  The Subsidiary Guarantor shall give prompt
written notice to the Trustee of any fact known to the Subsidiary Guarantor
which would prohibit the making of any payment to or by the Trustee in respect
of any Subsidiary Guarantee. 
Notwithstanding the provisions of this Article or any other
provision of this Indenture or any Subsidiary Guarantee, the Trustee shall not
be charged with knowledge of the existence of any facts which would prohibit
the making of any payment to or by the Trustee in respect of any Subsidiary
Guarantee, unless and until a Responsible Officer of the Trustee shall have
received written notice thereof from the Subsidiary Guarantor or a holder of
Senior Indebtedness of the Subsidiary Guarantor or from any trustee, agent or
representative therefor (whether or not the facts contained in such notice are
true); provided, however, that if the Trustee shall not have
received the notice provided for in this Section at least three Business
Days prior to the date upon which by the terms hereof any monies may become
payable for any purpose (including, without limitation, the payment of the
principal of (and premium, if any) or interest (including any Additional
Interest) on any Security), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive
such monies and to apply the same to the purpose for which they were received
and shall not be affected by any notice to the contrary which may be received
by it within three Business Days prior to such date.

 

Section 1311          Reliance on Judicial Order or
Certificate of Liquidating Agent or Other Notices.  Upon any payment or distribution of assets of
the Subsidiary Guarantor referred to in this Article, the Trustee, subject to
the provisions of Article Six, and the Holders of the Securities shall be
entitled to rely upon any order or decree entered by any court of competent
jurisdiction in which such Proceeding is pending, or a certificate of the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders of Securities, for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Indebtedness of the Subsidiary
Guarantor and other indebtedness of the Subsidiary Guarantor, the amount
thereof or payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article.

 

The
Trustee shall be entitled to rely on the delivery to it of a written notice by
a Person representing himself to be a holder of Senior Indebtedness of the
Subsidiary Guarantor (or an agent or representative of such holder or a trustee
under any indenture under which any instruments evidencing any such Senior
Indebtedness may have been issued) to establish that such notice has been given
by a holder of such Senior Indebtedness or such agent or representative or
trustee on behalf of such holder.  In the
event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness of the Subsidiary Guarantor to participate in any payment or
distribution pursuant to this Article Thirteen, the Trustee may request
such Person to furnish evidence to the reasonable satisfaction of 

 

84

 

the Trustee as to
the amount of Senior Indebtedness of the Subsidiary Guarantor held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the right of such
Person under this Article Thirteen, and, if such evidence is not
furnished, the Trustee may defer any payment to such Person pending judicial determination
as to the right of such Person to receive such payment or distribution.

 

Section 1312          Trustee Not Fiduciary for Holders
of Senior Indebtedness of the Subsidiary Guarantor.  The Trustee, in its capacity as trustee under
this Indenture, shall not be deemed to owe any fiduciary duty to the holders of
Senior Indebtedness of the Subsidiary Guarantor and shall not be liable to any
such holders if it shall in good faith mistakenly pay over or distribute to
Holders of Securities or to the Subsidiary Guarantor or to any other Person
cash, property or securities to which any holders of Senior Indebtedness of the
Subsidiary Guarantor shall be entitled by virtue of this Article or
otherwise.

 

Section 1313          Rights of Trustee as Holder of
Senior Indebtedness of the Subsidiary Guarantor; Preservation of Trustee’s
Rights.  The Trustee in its
individual capacity shall be entitled to all the rights set forth in this Article with
respect to any Senior Indebtedness of the Subsidiary Guarantor which may at any
time be held by it, to the same extent as any other holder of such Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder.

 

Nothing
in this Article shall apply to claims of, or payments to, the Trustee under
or pursuant to Section 607.

 

Section 1314          Article Applicable to Paying
Agents.  In case at any time any
Paying Agent other than the Trustee shall have been appointed by the Company
and be then acting hereunder, the term “Trustee” as used in this Article shall
in such case (unless the context otherwise requires) be construed as extending
to and including such Paying Agent within its meaning as fully for all intents
and purposes as if such Paying Agent were named in this Article in
addition to or in place of the Trustee.

 

Section 1315          Certain Conversions or Exchanges
Deemed Payment.  For the purposes of
this Article only, (a) the issuance and delivery of junior
securities upon conversion or exchange of Securities shall not be deemed to
constitute a payment or distribution on account of the principal of (or
premium, if any) or interest (including any Additional Interest) on Securities
or on account of the purchase or other acquisition of Securities, and (b) the
payment, issuance or delivery of cash, property or securities (other than
junior securities) upon conversion or exchange of a Security shall be deemed to
constitute payment on account of the principal of such Security.  For the purposes of this Section, the term “junior
securities” means (i) shares of any stock of any class of the
Company and (ii) securities of the Company which are subordinated
in right of payment to all Senior Indebtedness which may be outstanding at the
time of issuance or delivery 

 

85

 

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

 

*    *    *    *

 

This
instrument may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.

 

86

 

IN
WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed
as of the day and year first above written.

 

 

	
   

  	
  PRINCIPAL FINANCIAL GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PRINCIPAL FINANCIAL SERVICES,

  
	
   

  	
  INC., as guarantor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WILMINGTON TRUST COMPANY, as

  
	
   

  	
  Trustee

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

87

 

ANNEX A

 

FORM OF TRUST AGREEMENT

 

This
TRUST AGREEMENT, dated as of                   ,
200  , between Principal Financial Group, Inc., a Delaware
corporation, as “Depositor” and                   ,
a                         
as “Trustee”.  The Depositor and the
Trustee hereby agree as follows:

 

1.             The
trust created hereby shall be known as                   ,
in which name the Trustee, or the Depositor to the extent provided herein, may
conduct the business of the Trust, make and execute contracts, and sue and be
sued.

 

2.             The
Depositor hereby assigns, transfers, conveys and sets over to the Trustee the
sum of $10.  The Trustee hereby
acknowledges receipt of such amount in trust from the Depositor, which amount
shall constitute the initial trust estate. 
The Trustee hereby declares that it will hold the trust estate in trust
for the Depositor.  It is the intention
of the parties hereto that the Trust created hereby constitute a statutory
trust under Chapter 38 of Title 12 of the Delaware Code, 12 Del. C. Section 3801
et  seq.  (the “Statutory
Trust Act”), and that this document constitutes the governing instrument of
the Trust.  The Trustee is hereby
authorized and directed to execute and file a certificate of trust with the
Delaware Secretary of State in accordance with the provisions of the Statutory
Trust Act.

 

3.             The
Depositor and the Trustee will enter into an amended and restated Trust
Agreement, satisfactory to each such party and substantially in the form
included as an exhibit to the 1933 Act Registration Statement (as defined
below), to provide for the contemplated operation of the Trust created hereby
and the issuance of the Preferred Securities and Common Securities referred to
therein.  Prior to the execution and
delivery of such amended and restated Trust Agreement, the Trustee shall not
have any duty or obligation hereunder or with respect to the trust estate, and
the Depositor shall take or cause to be taken any action as may be required to
obtain any licenses, consents or approvals required by applicable law or
otherwise.  Notwithstanding the
foregoing, the Trustee may take all actions requested by the Depositor which
the Depositor deems necessary, convenient or incidental to effect the
transactions contemplated herein.  Except
as otherwise expressly required by Section 2 herein, the Trustee shall not
have any duty or obligation under or in connection with this Trust Agreement or
any document contemplated hereby, including, without limitation, with respect
to the administration of the Trust, and no implied duties or obligations shall
be inferred from or read into this Trust Agreement against or with respect to
the Trustee.  The Trustee has no duty or
obligation to supervise or monitor the performance of, or compliance with this
Trust Agreement, by the Depositor or any other beneficiaries, any agents or
attorneys-in-fact of the Depositor, or any other trustee of the Trust.  The Trustee shall not be liable for the acts
or omissions of the Depositor or any other beneficiaries, any agents or
attorneys-in-fact of the Depositor, or any other trustee of the Trust nor shall
the Trustee be liable for 

 

 

any act or omission by it in good faith in accordance with the directions
of the Depositor.  The right of the
Trustee to perform any discretionary act enumerated herein shall not be
construed as a duty.

 

4.             The
Depositor is hereby authorized, (i) to file with the Securities and
Exchange Commission (the “Commission”) and execute, in each case on
behalf of the Trust, (a) the Registration Statement on Form S-3
(the “1933 Act Registration Statement”), including any pre-effective or
post-effective amendments to such 1933 Act Registration Statement (including
the prospectus and the exhibits contained therein), relating to the
registration under the Securities Act of 1933, as amended, of the Preferred
Securities of the Trust and certain other securities and (b) a
Registration Statement on Form 8-A (the “1934 Act Registration Statement”)
(including all pre-effective and post-effective amendments thereto) relating to
the registration of the Preferred Securities of the Trust under Section 12(b) of
the Securities Exchange Act of 1934, as amended; (ii) to file with
the New York Stock Exchange (the “Exchange”) and execute on behalf of
the Trust a listing application and all other applications, statements,
certificates, agreements and other instruments as shall be necessary or
desirable to cause the Preferred Securities to be listed on the Exchange; (iii) to
file and execute on behalf of the Trust such applications, reports, surety
bonds, irrevocable consents, appointments of attorney for service of process
and other papers and documents as shall be necessary or desirable to register
the Preferred Securities under the securities or “Blue Sky” laws, and to obtain
any permits under the insurance laws of such jurisdictions as the Depositor, on
behalf of the Trust, may deem necessary or desirable and (iv) to
execute on behalf of the Trust one or more Underwriting Agreements with one or
more underwriters relating to the offering of the Preferred Securities.  In the event that any filing referred to in
clauses (i), (ii) and (iii) above is required by
the rules and regulations of the Commission, the Exchange or state
securities or blue sky laws, to be executed on behalf of the Trust by a
Trustee, the Depositor and any Trustee appointed pursuant to Section 6
hereof are hereby authorized to join in any such filing and to execute on
behalf of the Trust any and all of the foregoing.  In connection with all of the foregoing, the
Depositor hereby constitutes and appoints                   ,
                
and                   ,
and each of them, as its true and lawful attorneys-in-fact and agents, with
full power of substitution and resubstitution, for the Depositor or in the
Depositor’s name, place and stead, in any and all capacities, to sign any and
all amendments (including post-effective amendments) to the 1933 Act
Registration Statement and the 1934 Act Registration Statement and to file the
same, with all exhibits thereto, and other documents in connection therewith,
with the Commission, granting unto said attorneys-in-fact and agents full power
and authority to do and perform each and every act and thing requisite and
necessary to be done in connection therewith, as fully to all intents and
purposes as the Depositor might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or their
respective substitute or substitutes, shall do or cause to be done by virtue
hereof.

 

2

 

5.             The
Trustee is authorized to take such action or refrain from taking such action
under this Trust Agreement as it may be directed in writing by the Depositor
from time to time; provided, however, that the Trustee shall not be required to
take or refrain from taking any such action if it shall have determined, or
shall have been advised by counsel, that such performance is likely to involve
the Trustee in personal liability or is contrary to the terms of this Trust
Agreement or of any document contemplated hereby to which the Trust or the
Trustee is a party or is otherwise contrary to law.  If at any time the Trustee determines that it
requires or desires guidance regarding the application of any provision of this
Trust Agreement or any other document, or regarding compliance with any
direction it received hereunder, then the Trustee may deliver a notice to the
Depositor requesting written instructions as to the course of action desired by
the Depositor, and such instructions by or on behalf of the Depositor shall
constitute full and complete authorization and protection for actions taken and
other performance by the Trustee in reliance thereon.  Until the Trustee has received such
instructions after delivering such notice, it may refrain from taking any
action with respect to the matters described in such notice.

 

6.             The
Depositor hereby agrees to (i) reimburse the Trustee for all
reasonable expenses (including reasonable fees and expenses of counsel and
other experts), (ii) indemnify, defend and hold harmless the
Trustee and the officers, directors, employees and agents of the Trustee
(collectively, including the Trustee in its individual capacity, the “Indemnified
Persons”) from and against any and all losses, damages, liabilities,
claims, actions, suits, costs, expenses, disbursements (including the
reasonable fees and expenses of counsel), taxes and penalties of any kind and
nature whatsoever (collectively, “Expenses”), to the extent that such
Expenses arise out of or are imposed upon or asserted at any time against such
Indemnified Persons with respect to the performance of this Trust Agreement,
the creation, operation, administration or termination of the Trust, or the
transactions contemplated hereby; provided, however, that the
Depositor shall not be required to indemnify an Indemnified Person for Expenses
to the extent such Expenses result from the willful misconduct, bad faith or
gross negligence of such Indemnified Person, and (iii) advance to
each such Indemnified Person Expenses (including reasonable fees and expenses
of counsel) incurred by such Indemnified Person, in defending any claim,
demand, action, suit or proceeding prior to the final disposition of such
claim, demand, action, suit or proceeding upon receipt by the Depositor of an
undertaking, by or on behalf of such Indemnified Person, to repay such amount
if it shall be determined that such Indemnified Person is not entitled to be
indemnified therefor under this Section 6. 
The obligations of the Depositor under this Section 6 shall survive
the resignation or removal of any Trustee, shall survive the termination of
this Trust Agreement, except by amendment and restatement of this Trust
Agreement, and shall survive the transfer by the Depositor of any or all of its
interest in the Trust.

 

7.             This
Trust Agreement may be executed in one or more counterparts.

 

3

 

8.             The
number of Trustees initially shall be one (1) and thereafter the number of
Trustees shall be such number as shall be fixed from time to time by a written
instrument signed by the Depositor which may increase or decrease the number of
Trustees; provided, however, that to the extent required by the
Statutory Trust Act, one Trustee shall either be a natural person who is a
resident of the State of Delaware or, if not a natural person, an entity which
has its principal place of business in the State of Delaware and otherwise
meets the requirements of applicable Delaware law.  Subject to the foregoing, the Depositor is
entitled to appoint or remove without cause any Trustee at any time.  The Trustee may resign upon thirty days’
prior notice to the Depositor.

 

9.             This
Trust Agreement shall be governed by, and construed in accordance with, the
laws of the State of Delaware (without regard to conflict of laws of
principles).

 

IN
WITNESS WHEREOF, the parties hereto have caused this Trust Agreement to be duly
executed as of the day and year first above written.

 

 

	
   

  	
  PRINCIPAL FINANCIAL GROUP, INC., 

  
	
   

  	
  as Depositor

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [                                                                                                      ],

  
	
   

  	
  as Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

4

 

ANNEX B

 

FORM OF
AMENDED AND RESTATED

TRUST AGREEMENT

 

among

 

PRINCIPAL
FINANCIAL GROUP, INC.,

as Depositor,

 

[                            ],

as Property Trustee and Delaware Trustee,

 

and

 

THE ADMINISTRATIVE
TRUSTEES NAMED HEREIN

 

dated as of

 

[                            ]

 

 

Table of Contents

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  
	
  ARTICLE I

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Defined Terms

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 101.

  	
   

  	
  Definitions

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Establishment of the Trust

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 201.

  	
   

  	
  Name

  	
   

  	
  11

  
	
  Section 202.

  	
   

  	
  Office of the Delaware Trustee;
  Principal Place of Business

  	
   

  	
  11

  
	
  Section 203.

  	
   

  	
  Initial Contribution of Trust
  Property; Organizational Expenses

  	
   

  	
  11

  
	
  Section 204.

  	
   

  	
  Issuance of the Preferred
  Securities

  	
   

  	
  11

  
	
  Section 205.

  	
   

  	
  Subscription and Purchase of
  Debentures; Issuance of the Common Securities

  	
   

  	
  12

  
	
  Section 206.

  	
   

  	
  Declaration of Trust

  	
   

  	
  12

  
	
  Section 207.

  	
   

  	
  Authorization to Enter into Certain
  Transactions

  	
   

  	
  12

  
	
  Section 208.

  	
   

  	
  Assets of Trust

  	
   

  	
  16

  
	
  Section 209.

  	
   

  	
  Title to Trust Property

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Payment Account

  
	
   

  
	
  Section 301.

  	
   

  	
  Payment Account

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Distributions; Redemption

  
	
   

  
	
  Section 401.

  	
   

  	
  Distributions

  	
   

  	
  17

  
	
  Section 402.

  	
   

  	
  Redemption

  	
   

  	
  18

  
	
  Section 403.

  	
   

  	
  Subordination of Common Securities

  	
   

  	
  20

  
	
  Section 404.

  	
   

  	
  Payment Procedures

  	
   

  	
  21

  
	
  Section 405.

  	
   

  	
  Tax Returns and Reports

  	
   

  	
  21

  
	
  Section 406.

  	
   

  	
  Payment of Taxes, Duties, Etc. of
  the Trust

  	
   

  	
  21

  
	
  Section 407.

  	
   

  	
  Payments under Indenture

  	
   

  	
  21

  

 

i

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  
	
  ARTICLE V

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Trust Securities Certificates

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 501.

  	
   

  	
  Initial Ownership

  	
   

  	
  22

  
	
  Section 502.

  	
   

  	
  The Trust Securities Certificates

  	
   

  	
  22

  
	
  Section 503.

  	
   

  	
  Delivery of Trust Securities
  Certificates

  	
   

  	
  22

  
	
  Section 504.

  	
   

  	
  Registration of Transfer and
  Exchange of Preferred Securities Certificates

  	
   

  	
  22

  
	
  Section 505.

  	
   

  	
  Mutilated, Destroyed, Lost or
  Stolen Trust Securities Certificates

  	
   

  	
  23

  
	
  Section 506.

  	
   

  	
  Persons Deemed Securityholders

  	
   

  	
  24

  
	
  Section 507.

  	
   

  	
  Access to List of Securityholders’
  Names and Addresses

  	
   

  	
  24

  
	
  Section 508.

  	
   

  	
  Maintenance of Office or Agency

  	
   

  	
  24

  
	
  Section 509.

  	
   

  	
  Appointment of Paying Agent

  	
   

  	
  24

  
	
  Section 510.

  	
   

  	
  Ownership of Common Securities by
  Depositor

  	
   

  	
  25

  
	
  Section 511.

  	
   

  	
  Book-Entry Preferred Securities
  Certificates; Common Securities Certificate

  	
   

  	
  25

  
	
  Section 512.

  	
   

  	
  Notices to Clearing Agency

  	
   

  	
  26

  
	
  Section 513.

  	
   

  	
  Definitive Preferred Securities
  Certificates

  	
   

  	
  26

  
	
  Section 514.

  	
   

  	
  Rights of Securityholders

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Acts of Securityholders; Meetings; Voting

  
	
   

  
	
  Section 601.

  	
   

  	
  Limitations on Voting Rights

  	
   

  	
  28

  
	
  Section 602.

  	
   

  	
  Notice of Meetings

  	
   

  	
  29

  
	
  Section 603.

  	
   

  	
  Meetings of Preferred
  Securityholders

  	
   

  	
  29

  
	
  Section 604.

  	
   

  	
  Voting Rights

  	
   

  	
  29

  
	
  Section 605.

  	
   

  	
  Section 6.5 Proxies, etc

  	
   

  	
  29

  
	
  Section 606.

  	
   

  	
  Securityholder Action by Written
  Consent

  	
   

  	
  30

  
	
  Section 607.

  	
   

  	
  Record Date for Voting and Other
  Purposes

  	
   

  	
  30

  
	
  Section 608.

  	
   

  	
  Acts of Securityholders

  	
   

  	
  30

  
	
  Section 609.

  	
   

  	
  Inspection of Records

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Representations and Warranties

  
	
   

  
	
  Section 701.

  	
   

  	
  Representations and Warranties of
  the Bank, the Property Trustee and the Delaware Trustee

  	
   

  	
  31

  
	
  Section 702.

  	
   

  	
  Representations and Warranties of
  Depositor

  	
   

  	
  34

  

 

ii

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  The Trustees

  
	
   

  
	
  Section 801.

  	
   

  	
  Certain Duties and Responsibilities

  	
   

  	
  34

  
	
  Section 802.

  	
   

  	
  Notice of Defaults

  	
   

  	
  36

  
	
  Section 803.

  	
   

  	
  Certain Rights of Property Trustee

  	
   

  	
  36

  
	
  Section 804.

  	
   

  	
  Not Responsible for Recitals or
  Issuance of Securities

  	
   

  	
  38

  
	
  Section 805.

  	
   

  	
  May Hold Securities

  	
   

  	
  39

  
	
  Section 806.

  	
   

  	
  Compensation; Indemnity; Fees

  	
   

  	
  39

  
	
  Section 807.

  	
   

  	
  Corporate Property Trustee Required;
  Eligibility of Trustees

  	
   

  	
  40

  
	
  Section 808.

  	
   

  	
  Conflicting Interests

  	
   

  	
  40

  
	
  Section 809.

  	
   

  	
  Co-Trustees and Separate Trustee

  	
   

  	
  40

  
	
  Section 810.

  	
   

  	
  Resignation and Removal;
  Appointment of Successor

  	
   

  	
  42

  
	
  Section 811.

  	
   

  	
  Acceptance of Appointment by
  Successor

  	
   

  	
  43

  
	
  Section 812.

  	
   

  	
  Merger, Conversion, Consolidation
  or Succession to Business

  	
   

  	
  44

  
	
  Section 813.

  	
   

  	
  Preferential Collection of Claims
  Against Depositor or Trust

  	
   

  	
  44

  
	
  Section 814.

  	
   

  	
  Reports by Property Trustee

  	
   

  	
  45

  
	
  Section 815.

  	
   

  	
  Reports to the Property Trustee

  	
   

  	
  45

  
	
  Section 816.

  	
   

  	
  Evidence of Compliance with
  Conditions Precedent

  	
   

  	
  45

  
	
  Section 817.

  	
   

  	
  Number of Trustees

  	
   

  	
  46

  
	
  Section 818.

  	
   

  	
  Delegation of Power

  	
   

  	
  46

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dissolution, Liquidation and Merger

  
	
   

  
	
  Section 901.

  	
   

  	
  Dissolution Upon Expiration Date

  	
   

  	
  47

  
	
  Section 902.

  	
   

  	
  Early Dissolution

  	
   

  	
  47

  
	
  Section 903.

  	
   

  	
  Termination

  	
   

  	
  47

  
	
  Section 904.

  	
   

  	
  Liquidation

  	
   

  	
  48

  
	
  Section 905.

  	
   

  	
  Mergers, Consolidations,
  Amalgamations or Replacements of the Trust

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Miscellaneous Provisions

  
	
   

  
	
  Section 1001.

  	
   

  	
  Limitation of Rights of
  Securityholders

  	
   

  	
  50

  
	
  Section 1002.

  	
   

  	
  Amendment

  	
   

  	
  50

  
	
  Section 1003.

  	
   

  	
  Separability

  	
   

  	
  52

  
	
  Section 1004.

  	
   

  	
  Governing Law

  	
   

  	
  52

  
	
  Section 1005.

  	
   

  	
  Payments Due on Non-Business Day

  	
   

  	
  52

  

 

iii

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1006.

  	
   

  	
  Successors

  	
   

  	
  52

  
	
  Section 1007.

  	
   

  	
  Headings

  	
   

  	
  52

  
	
  Section 1008.

  	
   

  	
  Reports, Notices and Demands

  	
   

  	
  52

  
	
  Section 1009.

  	
   

  	
  Agreement Not to Petition

  	
   

  	
  53

  
	
  Section 1010.

  	
   

  	
  Trust Indenture Act; Conflict with
  Trust Indenture Act

  	
   

  	
  53

  
	
  Section 1011.

  	
   

  	
  Acceptance of Terms of Trust
  Agreement, Guarantee and Indenture

  	
   

  	
  54

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A

  	
   

  	
  Certificate of Trust

  	
   

  	
   

  
	
  Exhibit B

  	
   

  	
  Form of
  Certificate Depository Agreement

  	
   

  	
   

  
	
  Exhibit C

  	
   

  	
  Form of Common
  Securities Certificate

  	
   

  	
   

  
	
  Exhibit D

  	
   

  	
  Form of Expense
  Agreement

  	
   

  	
   

  
	
  Exhibit E

  	
   

  	
  Form of Preferred
  Securities

  	
   

  	
   

  
							

 

iv

 

	
  Certain Sections
  of this Trust Agreement relating to

  
	
  Sections 310
  through 318 of the

  
	
  Trust Indenture
  Act of 1939:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TRUST INDENTURE ACT SECTION

  	
   

  	
  TRUST AGREEMENT SECTION

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 310(a)(1)

  	
   

  	
   

  	
   

  	
  807

  
	
  (a)(2)

  	
   

  	
   

  	
   

  	
  807

  
	
  (a)(3)

  	
   

  	
   

  	
   

  	
  809

  
	
  (a)(4)

  	
   

  	
   

  	
   

  	
  2.7(1)(b)

  
	
  (b)

  	
   

  	
   

  	
   

  	
  808

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 311(a)

  	
   

  	
   

  	
   

  	
  813

  
	
  (b)

  	
   

  	
   

  	
   

  	
  813

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 312(a)

  	
   

  	
   

  	
   

  	
  507

  
	
  (b)

  	
   

  	
   

  	
   

  	
  507

  
	
  (c)

  	
   

  	
   

  	
   

  	
  507

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 313(a)

  	
   

  	
   

  	
   

  	
  814(1)

  
	
  (a)(4)

  	
   

  	
   

  	
   

  	
  8.14(2)

  
	
  (b)

  	
   

  	
   

  	
   

  	
  8.14(2)

  
	
  (c)

  	
   

  	
   

  	
   

  	
  1008

  
	
  (d)

  	
   

  	
   

  	
   

  	
  814(3)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 314(a)

  	
   

  	
   

  	
   

  	
  815

  
	
  (b)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
	
  (c)(1)

  	
   

  	
   

  	
   

  	
  816

  
	
  (c)(2)

  	
   

  	
   

  	
   

  	
  816

  
	
  (c)(3)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
	
  (d)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
	
  (e)

  	
   

  	
   

  	
   

  	
  101, 816

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 315(a)

  	
   

  	
   

  	
   

  	
  801(1), 803(1)

  
	
  (b)

  	
   

  	
   

  	
   

  	
  802, 1008

  
	
  (c)

  	
   

  	
   

  	
   

  	
  801(1)

  
	
  (d)

  	
   

  	
   

  	
   

  	
  801, 803

  
	
  (e)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 316(a)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
	
  (a)(1)(A)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
	
  (a)(1)(B)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
	
  (a)(2)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
											

 

v

 

	
  (b)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
	
  (c)

  	
   

  	
   

  	
   

  	
  607

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 317(a)(1)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
	
  (a)(2)

  	
   

  	
   

  	
   

  	
  Not Applicable

  
	
  (b)

  	
   

  	
   

  	
   

  	
  509

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 318

  	
   

  	
   

  	
   

  	
  1010

  

 

NOTE:  This
reconciliation and tie sheet shall not, for any purpose, be deemed to be a part
of the Trust Agreement.

 

vii

 

AMENDED
AND RESTATED TRUST AGREEMENT, dated as of                       ,
200  , among (i) Principal Financial Group, Inc., a
Delaware corporation (including any successors or assigns, the “Depositor”),
(ii)                                               ,
a                           
duly organized and existing under the laws of the State of Delaware, as
property trustee and Delaware trustee (in each such capacity, the “Property
Trustee” and “Delaware Trustee,” respectively, and, in its separate
corporate capacity and not in its capacity as Property Trustee or Delaware
Trustee, the “Bank”), (iii)                     ,
an individual, and                     ,
an individual, each of whose address is c/o Principal Financial Group, Inc.,
711 High Street, Des Moines, Iowa 50392 (each an “Administrative Trustee”
and collectively the “Administrative Trustees”) (the Property Trustee,
the Delaware Trustee and the Administrative Trustees referred to collectively
as the “Trustees”) and (iv) the several Holders, as hereinafter
defined.

 

W  I  T  N  E  S  S  E  T  H:

 

WHEREAS,
the Depositor and the Delaware Trustee have heretofore duly declared and
established a statutory trust pursuant to the Delaware Statutory Trust Act by
the entering into of that certain Trust Agreement, dated as of                   ,
200  , (the “Original Trust Agreement”), and by the execution
and filing by the Delaware Trustee with the Secretary of State of the State of
Delaware of the Certificate of Trust, filed on               ,
200  , attached as Exhibit A; and

 

WHEREAS,
the parties thereto desire to amend and restate the Original Trust Agreement in
its entirety as set forth herein to provide for, among other things, (i) the
issuance of the Common Securities by the Trust to the Depositor, (ii) the
issuance and sale of the Preferred Securities by the Trust pursuant to the
Underwriting Agreement, (iii) the acquisition by the Trust from the
Depositor of all of the right, title and interest in the Debentures and (iv) the
appointment of the Administrative Trustees;

 

NOW
THEREFORE, in consideration of the agreements and obligations set forth herein
and for other good and valuable consideration, the sufficiency of which is
hereby acknowledged, each party, for the benefit of the other party and for the
benefit of the Securityholders, hereby amends and restates the Original Trust
Agreement in its entirety and agrees as follows:

 

ARTICLE ONE

 

Defined Terms

 

Section 101            Definitions.  For all purposes of this Trust Agreement,
except as otherwise expressly provided or unless the context otherwise
requires:

 

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

 

 

(b)           all other terms used herein that are
defined in the Trust Indenture Act, either directly or by reference therein,
have the meanings assigned to them therein;

 

(c)           unless the context otherwise
requires, any reference to an “Article” or a “Section” refers to an Article or
a Section, as the case may be, of this Trust Agreement; and

 

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

 

“Act”
has the meaning specified in Section 608.

 

“Additional
Amount” means, with respect to Trust Securities of a given Liquidation
Amount and/or a given period, the amount of Additional Interest (as defined in
the Indenture) paid by the Depositor on a Like Amount of Debentures for such
period.

 

“Administrative
Trustee” means each of                     
and                     ,
solely in his capacity as Administrative Trustee of the Trust not in his
individual capacity, or such Administrative Trustee’s successor in interest in
such capacity, or any successor trustee appointed as herein provided.

 

“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 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.

 

“Bank”
has the meaning specified in the preamble to this Trust Agreement.

 

“Bankruptcy
Event” means, with respect to any Person:

 

(a)           the entry of a decree or order by a
court having jurisdiction in the premises judging such Person a bankrupt or
insolvent, or approving as properly filed a petition seeking reorganization,
arrangement, adjudication or composition of or in respect of such Person under
any applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law, or appointing a receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) of such Person or of any substantial part
of its property or ordering the winding up or liquidation of its affairs, and
the continuance of any such decree or order unstayed and in effect for a period
of 60 consecutive days; or

 

2

 

(b)           the institution by such Person of
proceedings to be adjudicated a bankrupt or insolvent, or the consent by it to
the institution of bankruptcy or insolvency proceedings against it, or the
filing by it of a petition or answer or consent seeking reorganization or relief
under any applicable Federal or State bankruptcy, insolvency, reorganization or
other similar law, or the consent by it to the filing of any such petition or
to the appointment of a receiver, liquidator, assignee, trustee, sequestrator
(or similar official) of such Person or of any substantial part of its
property, or the making by it of an assignment for the benefit of creditors, or
the admission by it in writing of its inability to pay its debts generally as
they become due and its willingness to be adjudicated a bankrupt, or the taking
of corporate action by such Person in furtherance of any such action.

 

“Bankruptcy
Laws” has the meaning specified in Section 1009.

 

“Board
Resolution” means a copy of a resolution certified by the Secretary or an
Assistant Secretary of the Depositor to have been duly adopted by the Depositor’s
Board of Directors, or such committee of the Board of Directors or officers of
the Depositor to which authority to act on behalf of the Board of Directors has
been delegated, and to be in full force and effect on the date of such
certification, and delivered to the Trustee.

 

“Book
Entry Preferred Securities Certificates” means a beneficial interest in the
Preferred Securities Certificates, ownership and transfers of which shall be made
through book entries by a Clearing Agency as described in Section 511.

 

“Business
Day” means a day other than (a) a Saturday or Sunday, (b) a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed, or (c) a day
on which the Property Trustee’s Corporate Trust Office or the Corporate Trust
Office of the Debenture Trustee is closed for business.

 

“Certificate
Depository Agreement” means the agreement among the Trust, the Depositor and
The Depository Trust Company, as the initial Clearing Agency, dated as of the
Closing Date, relating to the Trust Certificates, substantially in the form
attached as Exhibit B, as the same may be amended and supplemented from
time to time.

 

“Clearing
Agency” means an organization registered as a “clearing agency” pursuant to
Section 17A of the Securities Exchange Act of 1934, as amended.  The Depository Trust Company will be the
initial Clearing Agency.

 

“Clearing
Agency Participant” means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency
effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.

 

3

 

“Closing
Date” means the First Time of Delivery as defined in the Underwriting
Agreement, which date is also the date of execution and delivery of this Trust
Agreement.

 

“Code”
means the Internal Revenue Code of 1986, as amended.

 

“Commission”
means the Securities and Exchange Commission, as from time to time constituted,
created under the Securities Exchange Act of 1934, as amended, or, if at any
time after the execution of this instrument 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
Security” means an undivided beneficial interest in the assets of the
Trust, having a Liquidation Amount of $25 and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.

 

“Common
Securities Certificate” means a certificate evidencing ownership of Common
Securities, substantially in the form attached as Exhibit C.

 

“Corporate
Trust Office” means (i) in the case of the Property Trustee,
the principal office of the Property Trustee, which as of the Closing Date is
located in                           ,
Delaware; and (ii) in the case of the Debenture Trustee, the
principal office of the Debenture Trustee, which as of the Closing Date is
located in                           ,
Delaware.

 

“Debenture
Event of Default” means an “Event of Default” as defined in the Indenture.

 

“Debenture
Redemption Date” means, with respect to any Debentures to be redeemed under
the Indenture, the date fixed for redemption under the Indenture.

 

“Debentures”
means the $       aggregate principal amount of
the Depositor’s     % Junior Subordinated Deferrable
Interest Debentures, Series     , issued pursuant to
the Indenture.

 

“Debenture
Trustee” means                     ,
a                             
organized under the laws of the State of Delaware and any successor thereto,
not in its individual capacity but solely in its capacity as trustee.

 

“Definitive
Preferred Securities Certificates” means either or both (as the context
requires) of (a) Preferred Securities Certificates issued in
certificated, fully registered form as provided in Section 511(1) and
(b) Preferred Securities Certificates issued in certificated, fully
registered form as provided in Section 513.

 

4

 

“Delaware
Statutory Trust Act” means Chapter 38 of Title 12 of the Delaware Code, 12
Del. C. (S) 3801, et  seq., as it may be amended from time to
time.

 

“Delaware
Trustee” means the commercial bank or trust company identified as the “Delaware
Trustee” in the preamble to this Trust Agreement solely in its capacity as
Delaware Trustee of the Trust and not in its individual capacity, or its successor
in interest in such capacity, or any successor trustee appointed as herein
provided.

 

“Depositor”
has the meaning specified in the preamble to this Trust Agreement.

 

“Distribution
Date” has the meaning specified in Section 401(1).

 

“Distributions”
means amounts payable in respect of the Trust Securities as provided in Section 401.

 

“Event
of Default” means any one of the following events (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):

 

(a)           the occurrence of a Debenture Event
of Default; or

 

(b)           default by the Trust in the payment
of any Distribution when it becomes due and payable, and continuation of such
default for a period of 30 days; or

 

(c)           default by the Trust in the payment
of any Redemption Price of any Trust Security when it becomes due and payable;
or

 

(d)           default in the performance, or
breach, in any material respect, of any covenant or warranty of the Trustees in
this Trust Agreement (other than a covenant or warranty a default in whose
performance or breach is dealt with in clause (b) or (c),
above) and continuation of such default or breach for a period of 60 days after
there has been given, by registered or certified mail, to the defaulting
Trustee or Trustees by the Holders of at least 10% in Liquidation Amount of the
Outstanding Preferred Securities a written notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a “Notice
of Default” hereunder; or

 

(e)           the occurrence of a Bankruptcy Event
with respect to the Property Trustee and the failure by the Depositor to
appoint a successor Property Trustee within 60 days thereof.

 

5

 

“Expense
Agreement” means the Agreement as to Expenses and Liabilities between the
Depositor and the Trust, substantially in the form attached as Exhibit D,
as amended from time to time.

 

“Expenses”
has the meaning specified in Section 806(3).

 

“Expiration
Date” has the meaning specified in Section 901.

 

“Grantor
Trust Event” has the meaning specified in Section 902(2).

 

“Guarantee”
means the Guarantee Agreement executed and delivered by the Depositor and                     ,
as trustee, contemporaneously with the execution and delivery of this Trust
Agreement, for the benefit of the holders of the Preferred Securities, as
amended from time to time.

 

“Indenture”
means the Junior Subordinated Indenture, dated as of                          ,
200  , as supplemented by a Supplemental Indenture No.       
dated as of                          ,
          , between the
Depositor and the Debenture Trustee, as trustee, as amended or supplemented
from time to time.

 

“Independent
Legal Counsel” has the meaning specified in Section 608.

 

“Investment
Company Event” means the occurrence of a change in law or regulation or a
change in interpretation or application of law or regulation by any legislative
body, court, governmental agency or regulatory authority (a “Change in 1940
Act Law”) to the effect that the Trust is or will be considered an “investment
company” that is required to be registered under the 1940 Act, which Change in
1940 Act Law becomes effective on or after the date of original issuance of the
Preferred Securities under this Trust Agreement.

 

“Lien”
means any lien, pledge, charge, encumbrance, mortgage, deed of trust, adverse
ownership interest, hypothecation, assignment, security interest or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever.

 

“Like
Amount” means (a) with respect to a redemption of Trust
Securities, Trust Securities having a Liquidation Amount equal to the principal
amount of Debentures to be contemporaneously redeemed in accordance with the
Indenture the proceeds of which will be used to pay the Redemption Price of
such Trust Securities, and (b) with respect to a distribution of
Debentures to Holders of Trust Securities in connection with a dissolution or
liquidation of the Trust, Debentures having a principal amount equal to the
Liquidation Amount of the Trust Securities of the Holder to whom such
Debentures are distributed.

 

6

 

“Liquidation
Amount” means the stated amount of $25 per Trust Security.

 

“Liquidation
Date” means each Date on which Debentures are to be distributed to Holders
of Trust Securities in connection with a termination and liquidation of the
Trust pursuant to Section 904(1).

 

“Liquidation
Distribution” has the meaning specified in Section 904(4).

 

“1940
Act” means the Investment Company Act of 1940, as amended.

 

“Officers’
Certificate” means a certificate signed by the Chairman, President, Chief
Executive Officer or a Vice President, and by the Treasurer, an Associate
Treasurer, an Assistant Treasurer, the Controller, the Secretary or an
Assistant Secretary, of the Depositor, and delivered to the appropriate
Trustee.  One of the officers signing an
Officers’ Certificate given pursuant to Section 806 shall be the principal
executive, financial or accounting officer of the Depositor.  Any Officers’ Certificate delivered with
respect to compliance with a condition or covenant provided for in this Trust
Agreement shall include:

 

(a)           a statement that each officer signing
the Officers’ Certificate has read the covenant or condition and the
definitions relating thereto;

 

(b)           a brief statement of the nature and
scope of the examination or investigation undertaken by each officer in
rendering the Officers’ Certificate;

 

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

 

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

 

“Opinion
of Counsel” means a written opinion of counsel, who may be counsel for the
Trust, the Property Trustee or the Depositor, but not an employee of any
thereof, and who shall be acceptable to the Property Trustee.

 

“Original
Trust Agreement” has the meaning specified in the recitals to this Trust
Agreement.

 

“Outstanding”,
when used with respect to Preferred Securities, means, as of the date of
determination, all Preferred Securities theretofore executed and delivered
under this Trust Agreement, except:

 

7

 

(a)           Preferred Securities theretofore
cancelled by the Administrative Trustees or delivered to the Administrative
Trustees for cancellation;

 

(b)           Preferred Securities for whose
payment or redemption money in the necessary amount has been theretofore
deposited with the Property Trustee or any Paying Agent for the Holders of such
Preferred Securities; provided that, if such Preferred Securities are to
be redeemed, notice of such redemption has been duly given pursuant to this
Trust Agreement; and

 

(c)           Preferred Securities which have been
paid or in exchange for or in lieu of which other Preferred Securities have
been executed and delivered pursuant to Section 505;

 

provided,
however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Preferred Securities owned by the Depositor, any Trustee or any Affiliate of
the Depositor or any Trustee shall be disregarded and deemed not to be
Outstanding, except that (a) in determining whether any Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Preferred Securities that such
Trustee knows to be so owned shall be so disregarded and (b) the
foregoing shall not apply at any time when all of the outstanding Preferred
Securities are owned by the Depositor, one or more of the Trustees and/or any
such Affiliate.  Preferred Securities so
owned which have been pledged in good faith may be regarded as Outstanding if
the pledgee establishes to the satisfaction of the Administrative Trustees the
pledgee’s right so to act with respect to such Preferred Securities and that
the pledgee is not the Depositor or any Affiliate of the Depositor.

 

“Owner”
means each Person who is the beneficial owner of a Book Entry Preferred
Securities Certificate as reflected in the records of the Clearing Agency or,
if a Clearing Agency Participant is not the Owner, then as reflected in the
records of a Person maintaining an account with such Clearing Agency (directly
or indirectly, in accordance with the rules of such Clearing Agency).

 

“Paying
Agent” means any paying agent or co-paying agent appointed pursuant to Section 509
and shall initially be the Property Trustee.

 

“Payment
Account” means a segregated non-interest-bearing corporate trust account
maintained by the Property Trustee with the Bank in its trust department for
the benefit of the Securityholders in which all amounts paid in respect of the
Debentures will be held and from which the Property Trustee shall make payments
to the Securityholders in accordance with Section 401.

 

8

 

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

 

“Preferred
Security” means an undivided beneficial interest in the assets of the
Trust, having a Liquidation Amount of $25 and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.

 

“Preferred
Securities Certificate” means a certificate evidencing ownership of
Preferred Securities, substantially in the form attached as Exhibit E.

 

“Property
Trustee” means the commercial bank or trust company identified as the “Property
Trustee” in the preamble to this Trust Agreement solely in its capacity as
Property Trustee of the Trust and not in its individual capacity, or its
successor in interest in such capacity, or any successor property trustee
appointed as herein provided.

 

“Redemption
Date” means, with respect to any Trust Security to be redeemed, the date
fixed for such redemption by or pursuant to this Trust Agreement; provided that
each Debenture Redemption Date and the stated maturity of the Debentures shall
be a Redemption Date for a Like Amount of Trust Securities.

 

“Redemption
Price” means, with respect to any Trust Security, the Liquidation Amount of
such Trust Security, plus accumulated and unpaid Distributions to the date of
redemption, plus the related amount of the premium, if any, paid by the
Depositor upon the concurrent redemption of a Like Amount of Debentures,
allocated on a pro rata basis (based on Liquidation Amounts) among the Trust
Securities.

 

“Relevant
Trustee” shall have the meaning specified in Section 810.

 

“Responsible
Officer” means, with respect to the Property Trustee or Delaware Trustee,
any officer within the Corporate Trust Office of the Property Trustee or
Delaware Trustee with direct responsibility for the administration of this
Trust Agreement, including any vice-president, any assistant vice president, any
assistant secretary, the treasurer, any assistant treasurer, any trust officer
or other officer of the Corporate Trust Office of the Property Trustee or
Delaware Trustee customarily performing functions similar to those performed by
any of the above designated officers and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of that officer’s knowledge of and familiarity with the
particular subject.

 

“Securities
Register” and “Securities Registrar” have the respective meanings
specified in Section 504.

 

9

 

“Securityholder”
or “Holder” means a Person in whose name a Trust Security or Securities
is registered in the Securities Register; any such Person shall be deemed to be
a beneficial owner within the meaning of the Delaware Statutory Trust Act.

 

“Special Event”
has the meaning specified in Section 902(2).

 

“Tax Event” means
the receipt by the Trust of an Opinion of Counsel experienced in such matters
to the effect that, as a result of any amendment to, or change (including any
announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein affecting taxation, or as a result of any official administrative
pronouncement or judicial decision interpreting or applying such laws or
regulations, which amendment or change is effective or such pronouncement or
decision is announced on or after the date of issuance of the Preferred
Securities under this Trust Agreement, there is more than an insubstantial risk
that (i) the Trust is, or will be within 90 days after the date
thereof, subject to United States Federal income tax with respect to income
received or accrued on the Debentures, (ii) interest payable by the
Depositor on the Debentures is not, or within 90 days after the date thereof,
will not be, deductible, in whole or in part, for United States Federal income
tax purposes or (iii) the Trust is, or will be within 90 days after
the date thereof, subject to more than a de minimis amount of other taxes,
duties, assessments or other governmental charges.

 

“Trust” means the
Delaware statutory trust created and continued hereby and identified on the
cover page to this Trust Agreement.

 

“Trust Agreement”
means this Amended and Restated Trust Agreement, as the same may be modified,
amended or supplemented in accordance with the applicable provisions hereof,
including all exhibits hereto, including, for all purposes of this Trust
Agreement and any such modification, amendment or supplement, the provisions of
the Trust Indenture Act that are deemed to be a part of and govern this Trust
Agreement and any such modification, amendment or supplement, respectively.

 

“Trust Indenture Act”
means the Trust Indenture Act of 1939 as in force at the date as of which this
instrument was executed; provided, however, that in the event the Trust
Indenture Act of 1939 is amended after such date, “Trust Indenture Act” means,
to the extent required by any such amendment, the Trust Indenture Act of 1939
as so amended.

 

“Trust Property”
means (a) the Debentures, (b) any cash on deposit in,
or owing to, the Payment Account and (c) all proceeds and rights in
respect of the foregoing and any other property and assets for the time being
held or deemed to be held by the Property Trustee pursuant to the trusts of
this Trust Agreement.

 

10

 

“Trust Security”
means any one of the Common Securities or the Preferred Securities.

 

“Trust Securities
Certificate” means any one of the Common Securities Certificates or the
Preferred Securities Certificates.

 

“Underwriting
Agreement” means the Underwriting Agreement, dated as of                  ,
         , among the Trust, the
Depositor and the Underwriters named therein.

 

ARTICLE TWO

 

Establishment of
the Trust

 

Section 201                                   Name.  The Trust created and continued hereby shall
be known as “[                         ],”
as such name may be modified from time to time by the Administrative Trustees
following written notice to the Holders of Trust Securities and the other
Trustees, in which name the Trustees may conduct the business of the Trust,
make and execute contracts and other instruments on behalf of the Trust and sue
and be sued.

 

Section 202                                   Office
of the Delaware Trustee; Principal Place of Business.  The address of the Delaware Trustee in the
State of Delaware is c/o                                ,
                  ,
                   ,
Delaware                 ,
Attention:                              ,
or such other address in the State of Delaware as the Delaware Trustee may
designate by written notice to the Securityholders and the Depositor.  The principal executive office of the Trust
is c/o Principal Financial Group, Inc., 711 High Street, Des Moines, Iowa
50392.

 

Section 203                                   Initial
Contribution of Trust Property; Organizational Expenses.  The Property Trustee acknowledges receipt in
trust from the Depositor in connection with the Original Trust Agreement of the
sum of $10, which constituted the initial Trust Property.  The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of any Trustee,
promptly reimburse such Trustee for any such expenses paid by such
Trustee.  The Depositor shall make no
claim upon the Trust Property for the payment of such expenses.

 

Section 204                                   Issuance
of the Preferred Securities.  On
behalf of the Trust and pursuant to the Original Trust Agreement, executed and
delivered the Underwriting Agreement. 
Contemporaneously with the execution and delivery of this Trust
Agreement, an Administrative Trustee, on behalf of the Trust, shall execute in
accordance with Section 502 and deliver to the Underwriters named therein
Preferred Securities Certificates, registered in the name of the nominee of the
initial Clearing Agency, in an aggregate amount of        
Preferred Securities having an aggregate 

 

11

 

Liquidation Amount of $      ,
against receipt of the aggregate purchase price of such Preferred Securities of
$     , which amount the Administrative Trustees shall
promptly deliver to the Property Trustee.

 

Section 205                                   Subscription
and Purchase of Debentures; Issuance of the Common Securities.  Contemporaneously with the execution and
delivery of this Trust Agreement, the Administrative Trustees, on behalf of the
Trust, shall subscribe to and purchase from the Depositor Debentures,
registered in the name of the Trust and having an aggregate principal amount
equal to $       , and, in satisfaction of
the purchase price for such Debentures, the Property Trustee, on behalf of the
Trust, shall deliver to the Depositor the sum of $      .  Contemporaneously therewith, an
Administrative Trustee, on behalf of the Trust, shall execute in accordance
with Section 502 and deliver to the Depositor Common Securities Certificates,
registered in the name of the Depositor, in an aggregate amount of         
Common Securities having an aggregate Liquidation Amount of $      
against payment by the Depositor of the sum of $      .

 

Section 206                                   Declaration
of Trust.  The exclusive purposes and
functions of the Trust are (a) to issue and sell Trust Securities
and use the proceeds from such sale to acquire the Debentures, and (b) to
engage in those activities necessary, convenient or incidental thereto.  The Depositor hereby appoints the Trustees as
trustees of the Trust, to have all the rights, powers and duties to the extent
set forth herein, and the Trustees hereby accept such appointment.  The Property Trustee hereby declares that it will
hold the Trust Property in trust upon and subject to the conditions set forth
herein for the benefit of the Securityholders. 
The Administrative Trustees shall have all rights, powers and duties set
forth herein and in accordance with applicable law with respect to
accomplishing the purposes of the Trust. 
The Delaware Trustee shall not be entitled to exercise any powers, nor
shall the Delaware Trustee have any of the duties and responsibilities, of the
Property Trustee or the Administrative Trustees set forth herein.  The Delaware Trustee shall be one of the
Trustees of the Trust for the sole and limited purpose of fulfilling the
requirements of Section 3807 of the Delaware Statutory Trust Act.

 

Section 207                                   Authorization to
Enter into Certain Transactions.

 

(1)                                  The
Trustees shall conduct the affairs of the Trust in accordance with the terms of
this Trust Agreement.  Subject to the
limitations set forth in paragraph (b) of this Section, and in accordance
with the following provisions (i) and (ii), the
Administrative Trustees shall have the authority to enter into all transactions
and agreements determined by the Trustees to be appropriate in exercising the
authority, express or implied, otherwise granted to the Trustees under this
Trust Agreement, and to perform all acts in furtherance thereof, including
without limitation, the following:

 

12

 

(A)                             As
among the Trustees, each Administrative Trustee shall have the power and
authority to act on behalf of the Trust with respect to the following matters:

 

(i)                                    the
issuance and sale of the Trust Securities;

 

(ii)                                 to
cause the Trust to enter into, and to execute, deliver and perform on behalf of
the Trust, the Expense Agreement and the Certificate Depository Agreement and
such other agreements as may be necessary or desirable in connection with the
purposes and function of the Trust;

 

(iii)                             assisting
in the registration of the Preferred Securities under the Securities Act of
1933, as amended, and under state securities or blue sky laws, and the
qualification of this Trust Agreement as a trust indenture under the Trust
Indenture Act;

 

(iv)                             assisting
in the listing of the Preferred Securities upon such securities exchange or
exchanges as shall be determined by the Depositor and the registration of the
Preferred Securities under the Securities Exchange Act of 1934, as amended, and
the preparation and filing of all periodic and other reports and other
documents pursuant to the foregoing;

 

(v)                                the
sending of notices (other than notices of default) and other information
regarding the Trust Securities and the Debentures to the Securityholders in
accordance with this Trust Agreement;

 

(vi)                             the
appointment of a Paying Agent, authenticating agent and Securities Registrar in
accordance with this Trust Agreement;

 

(vii)                          registering
transfer of the Trust Securities in accordance with this Trust Agreement;

 

(viii)                       to
the extent provided in this Trust Agreement, the winding up of the affairs of
and liquidation of the Trust and the preparation, execution and filing of the
certificate of cancellation with the Secretary of State of the State of
Delaware;

 

(ix)                               unless
as otherwise required by the Delaware Statutory Trust Act or the Trust
Indenture Act, to execute on behalf of the Trust (either acting alone or
together with any or all of the 

 

13

 

Administrative Trustees)
any documents that the Administrative Trustees have the power to execute
pursuant to this Trust Agreement; and

 

(x)                                   the
taking of any action incidental to the foregoing as the Trustees may from time
to time determine is necessary or advisable to give effect to the terms of this
Trust Agreement for the benefit of the Securityholders (without consideration
of the effect of any such action on any particular Securityholder).

 

(B)                                As
among the Trustees, the Property Trustee shall have the power, duty and
authority to act on behalf of the Trust with respect to the following matters:

 

(i)                                    the
establishment of the Payment Account;

 

(ii)                                 the
receipt of the Debentures;

 

(iii)                              the
collection of interest, principal and any other payments made in respect of the
Debentures in the Payment Account;

 

(iv)                             the
distribution of amounts owed to the Securityholders in respect of the Trust
Securities;

 

(v)                                the
exercise of all of the rights, powers and privileges of a holder of the
Debentures;

 

(vi)                             the
sending of notices of default and other information regarding the Trust
Securities and the Debentures to the Securityholders in accordance with this
Trust Agreement;

 

(vii)                          the
distribution of the Trust Property in accordance with the terms of this Trust
Agreement;

 

(viii)                       to
the extent provided in this Trust Agreement, the winding up of the affairs of
and liquidation of the Trust and the preparation, execution and filing of the
certificate of cancellation with the Secretary of State of the State of
Delaware;

 

(ix)                               after
an Event of Default the taking of any action incidental to the foregoing as the
Property Trustee may from time to time determine is necessary or advisable to
give effect to the terms of this Trust Agreement and protect and conserve the
Trust Property for the benefit of the Securityholders (without 

 

14

 

consideration of the
effect of any such action on any particular Securityholder);

 

(x)                                  registering
transfers of the Trust Securities in accordance with this Trust Agreement; and

 

(xi)                               subject
to this Section 207(1)(b), the Property Trustee shall have none of the
duties, liabilities, powers or the authority of the Administrative Trustees set
forth in Section 207(1)(a).

 

(2)                                  So
long as this Trust Agreement remains in effect, the Trust (or the Trustees
acting on behalf of the Trust) shall not undertake any business, activities or
transaction except as expressly provided herein or contemplated hereby.  In particular, the Trustees shall not (i) acquire
any investments or engage in any activities not authorized by this Trust
Agreement, (ii) sell, assign, transfer, exchange, mortgage, pledge,
set-off or otherwise dispose of any of the Trust Property or interests therein,
including to Securityholders, except as expressly provided herein, (iii) take
any action that would cause the Trust to fail or cease to qualify as a “grantor
trust” for federal income tax purposes, (iv) incur any indebtedness
for borrowed money or issue any other debt or (v) take or consent
to any action that would result in the placement of a Lien on any of the Trust
Property.  The Administrative Trustees
shall defend all claims and demands of all Persons at any time claiming any Lien
on any of the Trust Property adverse to the interest of the Trust or the
Securityholders in their capacity as Securityholders.

 

(3)                                  In
connection with the issue and sale of the Preferred Securities, the Depositor
shall have the right and responsibility to assist the Trust with respect to, or
effect on behalf of the Trust, the following (and any actions taken by the
Depositor in furtherance of the following prior to the date of this Trust
Agreement are hereby ratified and confirmed in all respects):

 

(A)                              to
prepare for filing by the Trust with the Commission and to execute on behalf of
the Trust a registration statement on Form S-3 or S-4 in relation to the
Preferred Securities, including any amendments thereto;

 

(B)                                to
determine the States in which to take appropriate action to qualify or register
for sale all or part of the Preferred Securities and to do any and all such
acts, other than actions which must be taken by or on behalf of the Trust, and
advise the Trustees of actions they must take on behalf of the Trust, and
prepare for execution and filing any documents to be executed and filed by the
Trust or on behalf of the Trust, as the 

 

15

 

Depositor deems necessary or advisable in order to
comply with the applicable laws of any such States;

 

(C)                                to
prepare for filing by the Trust and to execute on behalf of the Trust an
application to the New York Stock Exchange or any other national stock exchange
or the Nasdaq National Market for listing upon notice of issuance of any
Preferred Securities;

 

(D)                               to
prepare for filing by the Trust with the Commission and to execute on behalf of
the Trust a registration statement on Form 8-A relating to the
registration of the Preferred Securities under Section 12(b) or 12(g) of
the Exchange Act, including any amendments thereto;

 

(E)                                 to
negotiate the terms of, and execute and deliver, the Underwriting Agreement
providing for the sale of the Preferred Securities; and

 

(F)                                 any
other actions necessary or desirable to carry out any of the foregoing
activities.

 

(4)                                  Notwithstanding
anything herein to the contrary, the Administrative Trustees are authorized and
directed to conduct the affairs of the Trust and to operate the Trust so that
the Trust will not be deemed to be an “investment company” required to be
registered under the Investment Company Act of 1940, as amended, or taxed as a
corporation for United States federal income tax purposes and so that the
Debentures will be treated as indebtedness of the Depositor for United States
federal income tax purposes.  In this
connection, the Depositor and the Administrative Trustees are authorized to
take any action, not inconsistent with applicable law, the Certificate of Trust
or this Trust Agreement, that each of the Depositor and the Administrative
Trustees determines in their discretion to be necessary or desirable for such
purposes, as long as such action does not adversely affect in any material
respect the interests of the holders of the Preferred Securities.

 

Section 208                                   Assets
of Trust.  The assets of the Trust
shall consist of the Trust Property.

 

Section 209                                   Title
to Trust Property.  Legal title to
all Trust Property shall be vested at all times in the Property Trustee (in its
capacity as such) and shall be held and administered by the Property Trustee
for the benefit of the Securityholders in accordance with this Trust Agreement.

 

16

 

ARTICLE THREE

 

Payment Account

 

Section 301                                   Payment Account.

 

(1)                                  On
or prior to the Closing Date, the Property Trustee shall establish the Payment
Account.  The Property Trustee and any
agent of the Property Trustee shall have exclusive control and sole right of
withdrawal with respect to the Payment Account for the purpose of making
deposits in and withdrawals from the Payment Account in accordance with this
Trust Agreement.  All monies and other
property deposited or held from time to time in the Payment Account shall be
held by the Property Trustee in the Payment Account for the exclusive benefit
of the Securityholders and for distribution as herein provided, including (and
subject to) any priority of payments provided for herein.

 

(2)                                  The
Property Trustee shall deposit in the Payment Account, promptly upon receipt,
all payments of principal or interest on, and any other payments or proceeds
with respect to, the Debentures.  Amounts
held in the Payment Account shall not be invested by the Property Trustee
pending distribution thereof.

 

ARTICLE FOUR

 

Distributions;
Redemption

 

Section 401                                   Distributions.

 

(1)                                  Distributions
on the Trust Securities shall be cumulative, and will accumulate whether or not
there are funds of the Trust available for the payment of Distributions.  Distributions shall accrue from                          ,
200  , and, except in the event that the Depositor exercises its
right to extend the interest payment period for the Debentures pursuant to the
Indenture, shall be payable quarterly in arrears on                               ,                             ,                    
and                    
of each year, commencing on                             ,           .  If any date on which Distributions are
otherwise payable on the Trust Securities is not a Business Day, then the
payment of such Distribution shall be made on the next succeeding day which is
a Business Day (and without any interest or other payment in respect of any
such delay) except that, if such Business Day is in the next succeeding
calendar year, payment of such Distribution shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date (each date on which distributions are payable in accordance with
this Section 401(1) a “Distribution Date”).

 

(2)                                  The
Trust Securities represent undivided beneficial interests in the Trust
Property, and, as a practical matter, the Distributions on the Trust Securities
shall be payable at a rate of          %
per annum of the Liquidation Amount of the Trust Securities.  

 

17

 

The amount of
Distributions payable for any full period shall be computed on the basis of a
360-day year of twelve 30-day months. 
The amount of Distributions payable for any period shall include the
Additional Amounts, if any.

 

(3)                                  Distributions
on the Trust Securities shall be made by the Property Trustee from the Payment
Account and shall be payable on each Distribution Date only to the extent that
the Trust has funds then on hand and available in the Payment Account for the
payment of such Distributions.

 

(4)                                  Distributions
on the Trust Securities with respect to a Distribution Date shall be payable to
the Holders thereof as they appear on the Securities Register for the Trust
Securities on the relevant record date, which shall be one Business Day prior
to such Distribution Date; provided, however, that in the event that the
Preferred Securities do not remain in book-entry-only form, the relevant record
date shall be the date 15 days prior to the relevant Distribution Date.

 

Section 402                                   Redemption.

 

(1)                                  On
each Debenture Redemption Date and on the stated maturity of the Debentures,
the Trust will be required to redeem a Like Amount of Trust Securities at the
Redemption Price.

 

(2)                                  Notice
of redemption shall be given by the Property Trustee by first-class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
Redemption Date to each Holder of Trust Securities to be redeemed, at such
Holder’s address appearing in the Security Register.  All notices of redemption shall state:

 

(a)                                  the
Redemption Date;

 

(b)                                 the
Redemption Price;

 

(c)                                  the
CUSIP number;

 

(d)                                 if
less than all the Outstanding Trust Securities are to be redeemed, the
identification and the total Liquidation Amount of the particular Trust
Securities to be redeemed; and

 

(e)                                  that
on the Redemption Date the Redemption Price will become due and payable upon
each such Trust Security to be redeemed and that distributions thereon will
cease to accrue on and after said date.

 

(3)                                  The
Trust Securities redeemed on each Redemption Date shall be redeemed at the
Redemption Price with the proceeds from the contemporaneous redemption of
Debentures.  Redemptions of the Trust
Securities shall be made and the Redemption Price shall be payable on each
Redemption Date only to the extent that the 

 

18

 

Trust has funds then on
hand and available in the Payment Account for the payment of such Redemption
Price.

 

(4)                                  If
the Property Trustee gives a notice of redemption in respect of any Preferred
Securities, then, by 12:00 noon, New York time, on the Redemption Date, subject
to Section 402(3), the Property Trustee will, so long as the Preferred
Securities are in book-entry-only form, irrevocably deposit with the Clearing
Agency for the Preferred Securities funds sufficient to pay the applicable
Redemption Price and will give such Clearing Agency irrevocable instructions
and authority to pay the Redemption Price to the holders thereof.  If the Preferred Securities are no longer in
book-entry-only form, the Property Trustee, subject to Section 402(3),
will irrevocably deposit with the Paying Agent funds sufficient to pay the
applicable Redemption Price and will give the Paying Agent irrevocable
instructions and authority to pay the Redemption Price to the holders thereof
upon surrender of their Preferred Securities Certificates.  Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date for any Trust Securities called for
redemption shall be payable to the Holders of such Trust Securities as they
appear on the Register for the Trust Securities on the relevant record dates
for the related Distribution Dates.  If
notice of redemption shall have been given and funds deposited as required,
then upon the date of such deposit, all rights of Securityholders holding Trust
Securities so called for redemption will cease, except the right of such
Securityholders to receive the Redemption Price, but without interest, and such
Securities will cease to be outstanding. 
In the event that any date on which any Redemption Price is payable is
not a Business Day, then payment of the Redemption Price payable on such date
will be made on the next succeeding day which is a Business Day (and without
any interest or other payment in respect of any such delay), except that, if
such Business Day falls in the next calendar year, such payment will be made on
the immediately preceding Business Day, in each case, with the same force and
effect as if made on such date.  In the
event that payment of the Redemption Price in respect of any Trust Securities
called for redemption is improperly withheld or refused and not paid either by
the Trust or by the Depositor pursuant to the Guarantee, Distributions on such
Trust Securities will continue to accrue, at the then applicable rate, from the
Redemption Date originally established by the Trust for such Trust Securities
to the date such Redemption Price is actually paid, in which case the actual
payment date will be the date fixed for redemption for purposes of calculating
the Redemption Price.

 

(5)                                  Payment
of the Redemption Price on the Trust Securities shall be made to the
recordholders thereof as they appear on the Securities Register for the Trust
Securities on the relevant record date, which shall be one Business Day prior
to the relevant Redemption Date; provided, however, that in the event that the
Preferred Securities do not remain in book-entry-only form, the relevant record
date shall be the fifteenth day prior to the Redemption Date.

 

19

 

(6)                                  If
less than all the Outstanding Trust Securities are to be redeemed on a
Redemption Date, then the aggregate Liquidation Amount of Trust Securities to
be redeemed shall be allocated on a pro rata basis (based on Liquidation
Amounts) among the Common Securities and the Preferred Securities.  The particular Preferred Securities to be
redeemed shall be selected on a pro rata basis (based upon Liquidation Amounts)
not more than 60 days prior to the Redemption Date by the Property Trustee from
the Outstanding Preferred Securities not previously called for redemption, by
such method as the Property Trustee shall deem fair and appropriate and which
may provide for the selection for redemption of portions (equal to $25 or an
integral multiple of $25 in excess thereof) of the Liquidation Amount of
Preferred Securities of a denomination larger than $25.  The Property Trustee shall promptly notify
the Security Registrar in writing of the Preferred Securities selected for redemption
and, in the case of any Preferred Securities selected for partial redemption,
the Liquidation Amount thereof to be redeemed. 
For all purposes of this Trust Agreement, unless the context otherwise
requires, all provisions relating to the redemption of Preferred Securities
shall relate, in the case of any Preferred Securities redeemed or to be
redeemed only in part, to the portion of the Liquidation Amount of Preferred
Securities which has been or is to be redeemed.

 

Section 403                                   Subordination of
Common Securities.

 

(1)                                  Payment
of Distributions (including Additional Amounts, if applicable) on, and the
Redemption Price of, the Trust Securities, as applicable, shall be made pro
rata based on the Liquidation Amount of the Trust Securities; provided,
however, that if on any Distribution Date or Redemption Date a Debenture Event
of Default shall have occurred and be continuing, no payment of any
Distribution (including Additional Amounts, if applicable) on, or Redemption
Price of, any Common Security, and no other payment on account of the redemption,
liquidation or other acquisition of Common Securities, shall be made unless
payment in full in cash of all accumulated and unpaid Distributions (including
Additional Amounts, if applicable) on all Outstanding Preferred Securities for
all distribution periods terminating on or prior thereto, or in the case of
payment of the Redemption Price the full amount of such Redemption Price on all
Outstanding Preferred Securities, shall have been made or provided for, and all
funds immediately available to the Property Trustee shall first be applied to
the payment in full in cash of all Distributions (including Additional Amounts,
if applicable) on, or Redemption Price of, Preferred Securities then due and
payable.

 

(2)                                  In
the case of the occurrence of any Debenture Event of Default, the Holder of
Common Securities will be deemed to have waived any right to act with respect
to any such Event of Default under this Trust Agreement until the effect of all
such Events of Default with respect to the Preferred Securities have been
cured, waived or otherwise eliminated. 
Until any such Event of Default under this Trust Agreement with respect
to the Preferred Securities have been so cured, waived or otherwise eliminated,
the Property Trustee shall act solely on behalf of the Holders of the Preferred

 

20

 

Securities and not the Holder of the Common Securities, and only the
Holders of the Preferred Securities will have the right to direct the Property
Trustee to act on their behalf.

 

Section 404                                   Payment
Procedures.  Payments in respect of
the Preferred Securities shall be made by check mailed to the address of the
Person entitled thereto as such address shall appear on the Securities Register
or, if the Preferred Securities are held by a Clearing Agency, such
Distributions shall be made to the Clearing Agency in immediately available
funds, which shall credit the relevant Persons’ accounts at such Clearing
Agency on the applicable distribution dates. 
Payments in respect of the Common Securities shall be made in such
manner as shall be mutually agreed between the Property Trustee and the Common
Securityholder.

 

Section 405                                   Tax
Returns and Reports.  The
Administrative Trustees shall prepare (or cause to be prepared), at the Depositor’s
expense, and file all Federal, state and local tax and information returns and
reports required to be filed by or in respect of the Trust.  In this regard, the Administrative Trustees
shall (a) prepare and file (or cause to be prepared or filed) the
appropriate Internal Revenue Service Form required to be filed in respect
of the Trust in each taxable year of the Trust and (b) prepare and
furnish (or cause to be prepared and furnished) to each Securityholder the
appropriate Internal Revenue Service form required to be furnished to such
Securityholder or the information required to be provided on such form.  The Administrative Trustees shall provide the
Depositor and the Property Trustee with a copy of all such returns, reports and
schedules promptly after such filing or furnishing.  The Trustees shall comply with United States
federal withholding and backup withholding tax laws and information reporting
requirements with respect to any payments to Securityholders under the Trust
Securities.

 

Section 406                                   Payment
of Taxes, Duties, Etc. of the Trust. 
Upon receipt under the Debentures of Additional Sums (as defined in the
Indenture), the Property Trustee shall upon receipt of written notice from the
applicable governmental authority promptly pay any taxes, duties or
governmental charges of whatsoever nature (other than withholding taxes)
imposed on the Trust by the United States or any other taxing authority.

 

Section 407                                   Payments
under Indenture.  Any amount payable
hereunder to any Holder of Preferred Securities (and any Owner with respect
thereto) shall be reduced by the amount of any corresponding payment such
Holder (and Owner) has directly received pursuant to Section 508 of the
Indenture.

 

21

 

ARTICLE FIVE

 

Trust Securities
Certificates

 

Section 501                                   Initial
Ownership.  Upon the formation of the
Trust and the contribution by the Depositor pursuant to Section 203 and
until the issuance of the Trust Securities, and at any time during which no
Trust Securities are outstanding, the Depositor shall be the sole beneficial
owner of the Trust.

 

Section 502                                   The
Trust Securities Certificates.  The
Preferred Securities Certificates shall be issued in minimum denominations of
$25 Liquidation Amount and integral multiples of $25 in excess thereof, and the
Common Securities Certificates shall be issued in denominations of $25
Liquidation Amount and integral multiples thereof.  The Trust Securities Certificates shall be
executed on behalf of the Trust by manual signature of at least one
Administrative Trustee.  Trust Securities
Certificates bearing the manual signatures of individuals who were, at the time
when such signatures shall have been affixed, authorized to sign on behalf of
the Trust, shall be validly issued and entitled to the benefits of this Trust
Agreement, notwithstanding that such individuals or any of them shall have
ceased to be so authorized prior to the delivery of such Trust Securities
Certificates or did not hold such offices at the date of delivery of such Trust
Securities Certificates.  A transferee of
a Trust Securities Certificate shall become a Securityholder, and shall be
entitled to the rights and subject to the obligations of a Securityholder
hereunder, upon due registration of such Trust Securities Certificate in such
transferee’s name pursuant to Section 504.

 

Section 503                                   Delivery
of Trust Securities Certificates.  On
the Closing Date, the Administrative Trustees shall cause Trust Securities
Certificates, in an aggregate Liquidation Amount as provided in Sections 204
and 205, to be executed on behalf of the Trust and delivered to or upon the
written order of the Depositor, signed by its chairman, president, chief
executive officer, any senior vice president or any vice president, treasurer
or assistant treasurer or controller without further corporate action by the
Depositor, in authorized denominations.

 

Section 504                                   Registration
of Transfer and Exchange of Preferred Securities Certificates.  The Securities Registrar shall keep or cause
to be kept, at the office or agency maintained pursuant to Section 508, a
Securities Register in which, subject to such reasonable regulations as it may
prescribe, the Securities Registrar shall provide for the registration of
Preferred Securities Certificates and Common Securities Certificates (subject
to Section 510 in the case of the Common Securities Certificates) and
registration of transfers and exchanges of Preferred Securities Certificates as
herein provided.  The Property Trustee
shall be the initial Securities Registrar. 
The provisions of Sections 801, 803 and 806 shall apply to the Property
Trustee also in its role as Securities Registrar, for so long as the Property
Trustee shall act as Securities Registrar and, to the extent applicable, to any
other securities registrar appointed hereunder. 
Any

 

22

 

reference in this Trust Agreement to the Securities Registrar shall
include any co-securities registrar unless the context requires otherwise.

 

Upon
surrender for registration of transfer of any Preferred Securities Certificate
at the office or agency maintained pursuant to Section 508, the
Administrative Trustees or any one of them shall execute and deliver, in the
name of the designated transferee or transferees, one or more new Preferred
Securities Certificates in authorized denominations of a like aggregate
Liquidation Amount dated the date of execution by such Administrative Trustee
or Trustees.  The Securities Registrar shall
not be required to register the transfer of any Preferred Securities that have
been called for redemption.  At the
option of a Holder, Preferred Securities Certificates may be exchanged for
other Preferred Securities Certificates in authorized denominations of the same
class and of a like aggregate Liquidation Amount upon surrender of the
Preferred Securities Certificates to be exchanged at the office or agency
maintained pursuant to Section 508.

 

Every
Preferred Securities Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer
in form satisfactory to the Administrative Trustees and the Securities
Registrar duly executed by the Holder or his attorney duly authorized in
writing.  Each Preferred Securities
Certificate surrendered for registration of transfer or exchange shall be
cancelled and subsequently disposed of by the Administrative Trustees in
accordance with their customary practice.

 

No
service charge shall be made for any registration of transfer or exchange of
Preferred Securities Certificates, but the Securities Registrar may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer or exchange of Preferred Securities
Certificates.

 

Section 505                                   Mutilated,
Destroyed, Lost or Stolen Trust Securities Certificates.  If (a) any mutilated Trust
Securities Certificate shall be surrendered to the Securities Registrar, or if
the Securities Registrar shall receive evidence to its satisfaction of the
destruction, loss or theft of any Trust Securities Certificate and (b) there
shall be delivered to the Securities Registrar and the Administrative Trustees
such security or indemnity as may be required by them to save each of them
harmless, then in the absence of notice that such Trust Securities Certificate
shall have been acquired by a protected purchaser, the Administrative Trustees,
or any one of them, on behalf of the Trust shall execute and make available for
delivery, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Trust Securities Certificate, a new Trust Securities Certificate of like
class, tenor and denomination.  In
connection with the issuance of any new Trust Securities Certificate under this
Section, the Administrative Trustees or the Securities Registrar may require
the payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection therewith. 
Any duplicate Trust Securities Certificate issued pursuant to this Section shall
constitute conclusive evidence of an undivided beneficial interest in the
assets of the Trust, as if originally issued,

 

23

 

whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.

 

Section 506                                   Persons
Deemed Securityholders.  The
Administrative Trustees or the Securities Registrar shall treat the Person in
whose name any Trust Securities Certificate shall be registered in the
Securities Register as the owner of such Trust Securities Certificate for the
purpose of receiving distributions and for all other purposes whatsoever, and
neither the Trustees nor the Securities Registrar shall be bound by any notice
to the contrary.

 

Section 507                                   Access
to List of Securityholders’ Names and Addresses.  The Administrative Trustees or the Depositor
shall furnish or cause to be furnished (a) to the Property Trustee,
semi-annually on or before January 15 and July 15 in each year, a
list, in such form as the Property Trustee may reasonably require, of the names
and addresses of the Securityholders as of the most recent Record Date and (b) to
the Property Trustee, promptly after receipt by any Administrative Trustee or
the Depositor of a request therefor from the Property Trustee in order to
enable the Property Trustee to discharge its obligations under this Trust
Agreement, in each case to the extent such information is in the possession or
control of the Administrative Trustees or the Depositor and is not identical to
a previously supplied list or has not otherwise been received by the Property
Trustee in its capacity as Securities Registrar.  The rights of Securityholders to communicate
with other Securityholders with respect to their rights under this Trust
Agreement or under the Trust Securities, and the corresponding rights of the
Trustee shall be as provided in the Trust Indenture Act.  Each Holder, by receiving and holding a Trust
Securities Certificate, and each Owner shall be deemed to have agreed not to
hold the Depositor, the Property Trustee or the Administrative Trustees
accountable by reason of the disclosure of its name and address, regardless of
the source from which such information was derived.

 

Section 508                                   Maintenance
of Office or Agency.  The
Administrative Trustees shall maintain in The City of New York, an office or
offices or agency or agencies where Preferred Securities Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Trustees in respect of the Trust Securities Certificates
may be served.  The Administrative
Trustees initially designate                                ,
as its principal corporate trust office for such purposes.  The Property Trustee shall give prompt
written notice to the Depositor and to the Securityholders of any change in the
location of the Securities Register or any such office or agency.

 

Section 509                                   Appointment
of Paying Agent.  The Paying Agent
shall make distributions to Securityholders from the Payment Account and shall
report the amounts of such distributions to the Property Trustee and the
Administrative Trustees.  Any Paying
Agent shall have the revocable power to withdraw funds from the Payment Account
for the purpose of making the distributions referred to above.  The

 

24

 

Administrative Trustees may revoke such power and remove the Paying
Agent if such Trustees determine in their sole discretion that the Paying Agent
shall have failed to perform its obligations under this Trust Agreement in any
material respect.  The Paying Agent shall
initially be the Property Trustee, and any co-paying agent chosen by the
Property Trustee, and acceptable to the Administrative Trustees and the Depositor.  Any Person acting as Paying Agent shall be
permitted to resign as Paying Agent upon 30 days’ written notice to the
Administrative Trustees, the Property Trustee and the Depositor.  In the event that the Property Trustee shall
no longer be the Paying Agent or a successor Paying Agent shall resign or its
authority to act be revoked, the Administrative Trustees shall appoint a
successor that is acceptable to the Property Trustee and the Depositor to act
as Paying Agent (which shall be a bank or trust company).  The Administrative Trustees shall cause such
successor Paying Agent or any additional Paying Agent appointed by the
Administrative Trustees to execute and deliver to the Trustees an instrument in
which such successor Paying Agent or additional Paying Agent shall agree with
the Trustees that as Paying Agent, such successor Paying Agent or additional
Paying Agent will hold all sums, if any, held by it for payment to the
Securityholders in trust for the benefit of the Securityholders entitled
thereto until such sums shall be paid to such Securityholders.  The Paying Agent shall return all unclaimed
funds to the Property Trustee and upon removal of a Paying Agent such Paying
Agent shall also return all funds in its possession to the Property Trustee.  The provisions of Sections 801, 803 and 806
shall apply to the Property Trustee also in its role as Paying Agent, for so
long as the Property Trustee shall act as Paying Agent and, to the extent
applicable, to any other paying agent appointed hereunder.  Any reference in this Trust Agreement to the
Paying Agent shall include any co-paying agent unless the context requires
otherwise.

 

Section 510                                   Ownership
of Common Securities by Depositor.  
On the Closing Date and on each other date provided for in Section 205,
the Depositor shall acquire and retain beneficial and record ownership of the
Common Securities.  To the fullest extent
permitted by law, except as otherwise permitted under the Indenture, any
attempted transfer of the Common Securities shall be void.  The Administrative Trustees shall cause each
Common Securities Certificate issued to the Depositor to contain a legend
stating “THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT AS PROVIDED IN THE TRUST
AGREEMENT (AS DEFINED BELOW)”.

 

Section 511                                   Book-Entry
Preferred Securities Certificates; Common Securities Certificate.

 

(1)                                  The
Preferred Securities Certificates, upon original issuance, will be issued in
the form of a typewritten Preferred Securities Certificate or Certificates
representing Book-Entry Preferred Securities Certificates, to be delivered to
The Depository Trust Company, the initial Clearing Agency, by, or on behalf of,
the Trust.  Such Preferred Securities
Certificate or Certificates shall initially be registered on the

 

25

 

Securities Register in the name of Cede & Co., the nominee of
the initial Clearing Agency, and no beneficial owner will receive a Definitive
Preferred Securities Certificate representing such beneficial owner’s interest
in such Preferred Securities, except as provided in Section 513.  Unless and until Definitive Preferred
Securities Certificates have been issued to beneficial owners pursuant to Section 513:

 

(a)                                  the
provisions of this Section 511(1) shall be in full force and effect;

 

(b)                                 the
Securities Registrar and the Trustees shall be entitled to deal with the
Clearing Agency for all purposes of this Trust Agreement relating to the
Book-Entry Preferred Securities Certificates (including the payment of
principal of and interest on the Book-Entry Preferred Securities and the giving
of instructions or directions to Owners of Book-Entry Preferred Securities) as
the sole Holder of Book-Entry Preferred Securities and shall have no
obligations to the Owners thereof;

 

(c)                                  to
the extent that the provisions of this Section 511 conflict with any other
provisions of this Trust Agreement, the provisions of this Section 511
shall control; and

 

(d)                                 the
rights of the Owners of the Book-Entry Preferred Securities Certificates shall
be exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Owners and the Clearing Agency
and/or the Clearing Agency Participants. 
Pursuant to the Certificate Depository Agreement, unless and until Definitive
Preferred Securities Certificates are issued pursuant to Section 513, the
initial Clearing Agency will make book-entry transfers among the Clearing
Agency Participants and receive and transmit payments on the Preferred
Securities to such Clearing Agency Participants.

 

(2)                                  A
single Common Securities Certificate representing the Common Securities shall
be issued to the Depositor in the form of a definitive Common Securities
Certificate.

 

Section 512                                   Notices
to Clearing Agency.  To the extent
that a notice or other communication to the Owners is required under this Trust
Agreement, unless and until Definitive Preferred Securities Certificates shall
have been issued to Owners pursuant to Section 513, the Trustees shall
give all such notices and communications specified herein to be given to Owners
to the Clearing Agency, and shall have no obligations to the Owners.

 

Section 513                                   Definitive
Preferred Securities Certificates. 
If (a) the Depositor advises the Trustees in writing that
the Clearing Agency is no longer willing or able to

 

26

 

properly discharge its responsibilities with respect to the Preferred
Securities Certificates, and the Depositor is unable to locate a qualified
successor, (b) the Depositor at its option advises the Trustees in
writing that it elects to terminate the book-entry system through the Clearing
Agency or (c) after the occurrence of a Debenture Event of Default,
Owners of Preferred Securities Certificates representing beneficial interests
aggregating at least a majority of the Liquidation Amount advise the Clearing
Agency in writing that the continuation of a book-entry system through the
Clearing Agency is no longer in the best interest of the Owners of Preferred
Securities Certificates, then the Clearing Agency shall notify all Owners of
Preferred Securities Certificates and the Trustees of the occurrence of any
such event and of the availability of the Definitive Preferred Securities
Certificates to Owners of such class or classes, as applicable, requesting the
same.  Upon surrender to the
Administrative Trustees of the typewritten Preferred Securities Certificate or
Certificates representing the Book Entry Preferred Securities Certificates by
the Clearing Agency, accompanied by registration instructions, the Administrative
Trustees, or any one of them, shall execute the Definitive Preferred Securities
Certificates in accordance with the instructions of the Clearing Agency.  Neither the Securities Registrar nor the
Trustees shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such
instructions.  Upon the issuance of
Definitive Preferred Securities Certificates, the Trustees shall recognize the
Holders of the Definitive Preferred Securities Certificates as
Securityholders.  The Definitive
Preferred Securities Certificates shall be printed, lithographed or engraved or
may be produced in any other manner as is reasonably acceptable to the
Administrative Trustees, as evidenced by the execution thereof by the
Administrative Trustees or any one of them.

 

Section 514                                   Rights
of Securityholders.  The legal title
to the Trust Property is vested exclusively in the Property Trustee (in its
capacity as such) in accordance with Section 209, and the Securityholders
shall not have any right or title therein other than the undivided beneficial
interest in the assets of the Trust conferred by their Trust Securities and
they shall have no right to call for any partition or division of property,
profits or rights of the Trust except as described below.  The Trust Securities shall be personal
property giving only the rights specifically set forth therein and in this
Trust Agreement.  The Trust Securities
shall have no preemptive or similar rights and when issued and delivered to
Securityholders against payment of the purchase price therefor will be fully
paid and nonassessable by the Trust.  The
Holders of the Trust Securities, in their capacities as such, shall be entitled
to the same limitation of personal liability extended to stockholders of
private corporations for profit organized under the General Corporation Law of
the State of Delaware.

 

27

 

ARTICLE SIX

 

Acts of
Securityholders; Meetings; Voting

 

Section 601                                   Limitations on
Voting Rights.

 

(1)                                  Except
as provided in this Section, in Sections 810 and 1002 and in the Indenture and
as otherwise required by law, no Holder of Preferred Securities shall have any
right to vote or in any manner otherwise control the administration, operation
and management of the Trust or the obligations of the parties hereto, nor shall
anything herein set forth, or contained in the terms of the Trust Securities
Certificates, be construed so as to constitute the Securityholders from time to
time as partners or members of an association.

 

(2)                                  So
long as any Debentures are held by the Property Trustee, the Trustees shall not
(i) direct the time, method and place of conducting any proceeding
for any remedy available to the Debenture Trustee, or executing any trust or
power conferred on the Debenture Trustee with respect to such Debentures, (ii) waive
any past default which is waivable under Section 513 of the Indenture, (iii) exercise
any right to rescind or annul a declaration that the principal of all the
Debentures shall be due and payable or (iv) consent to any
amendment, modification or termination of the Indenture or the Debentures,
where such consent shall be required, without, in each case, obtaining the
prior approval of the Holders of at least a majority in Liquidation Amount of
all outstanding Preferred Securities; provided, however, that where a consent
under the Indenture would require the consent of each holder of Debentures
affected thereby, no such consent shall be given by the Property Trustee
without the prior written consent of each holder of Preferred Securities.  The Trustees shall not revoke any action
previously authorized or approved by a vote of the Preferred Securities, except
by a subsequent vote of the Preferred Securities.  The Property Trustee shall notify all Holders
of the Preferred Securities of any notice of default received from the
Debenture Trustee with respect to the Debentures.  In addition to obtaining the foregoing
approvals of the Holders of the Preferred Securities, prior to taking any of
the foregoing actions, the Trustees shall, at the expense of the Depositor,
obtain an Opinion of Counsel experienced in such matters to the effect that the
Trust will not be classified as an association taxable as a corporation or
partnership for United States federal income tax purposes on account of such
action.

 

(3)                                  If
any proposed amendment to the Trust Agreement provides for, or the Trustees
otherwise propose to effect, (i) any action that would adversely
affect in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to the Trust Agreement or
otherwise, or (ii) the dissolution, winding-up or termination of
the Trust, other than pursuant to the terms of this Trust Agreement, then the
Holders of Outstanding Preferred Securities as a class will be entitled to vote
on such amendment or proposal and such amendment or proposal shall

 

28

 

not be effective except with the approval of the Holders of at least a
majority in Liquidation Amount of the Outstanding Preferred Securities.

 

Section 602                                   Notice
of Meetings.  Notice of all meetings
of the Preferred Securityholders, stating the time, place and purpose of the
meeting, shall be given by the Property Trustee upon receipt of written notice
of the calling of such meeting from the Administrative Trustees pursuant to Section 1008
to each Preferred Securityholder of record, at his registered address, at least
15 days and not more than 90 days before the meeting.  At any such meeting, any business properly
before the meeting may be so considered whether or not stated in the notice of
the meeting.  Any adjourned meeting may
be held as adjourned without further notice.

 

Section 603                                   Meetings
of Preferred Securityholders.  No
annual meeting of Securityholders is required to be held.  The Administrative Trustees, however, shall
call a meeting of Securityholders to vote on any matter upon the written
request of the Preferred Securityholders of record of 25% of the Preferred
Securities (based upon their Liquidation Amount) and the Administrative
Trustees or the Property Trustee may, at any time in their discretion, call a
meeting of Preferred Securityholders to vote on any matters as to which
Preferred Securityholders are entitled to vote.

 

Preferred
Securityholders of record of 50% of the Preferred Securities (based upon their
Liquidation Amount), present in person or by proxy, shall constitute a quorum
at any meeting of Securityholders.

 

If a
quorum is present at a meeting, an affirmative vote by the Preferred
Securityholders of record present, in person or by proxy, holding more than a
majority of the Preferred Securities (based upon their Liquidation Amount) held
by the Preferred Securityholders of record present, either in person or by
proxy, at such meeting shall constitute the action of the Securityholders,
unless this Trust Agreement requires a greater number of affirmative votes.

 

Section 604                                   Voting
Rights.  Securityholders shall be
entitled to one vote for each $25 of Liquidation Amount represented by their
Trust Securities in respect of any matter as to which such Securityholders are
entitled to vote.

 

Section 605                                   Proxies,
etc.  At any meeting of
Securityholders, any Securityholder entitled to vote thereat may vote by proxy,
provided that no proxy shall be voted at any meeting unless it shall
have been placed on file with the Administrative Trustees, or with such other
officer or agent of the Trust as the Administrative Trustees may direct, for
verification prior to the time at which such vote shall be taken.  Pursuant to a resolution of the Property
Trustee, proxies may be solicited in the name of the Property Trustee or one or
more officers of the Property Trustee. 
Only Securityholders of record shall be entitled to vote.  When Trust Securities are held jointly by
several persons, any one of them may vote at any meeting in person or by proxy
in respect of

 

29

 

such Trust Securities, but if more than one of them shall be present at
such meeting in person or by proxy, and such joint owners or their proxies so
present disagree as to any vote to be cast, such vote shall not be received in
respect of such Trust Securities.  A
proxy purporting to be executed by or on behalf of a Securityholder shall be
deemed valid unless challenged at or prior to its exercise, and the burden of
proving invalidity shall rest on the challenger.  No proxy shall be valid more than three years
after its date of execution.

 

Section 606                                   Securityholder
Action by Written Consent.  Any
action which may be taken by Securityholders at a meeting may be taken without
prior notice and without a meeting if Securityholders holding more than a
majority of all Outstanding Trust Securities (based upon their Liquidation
Amount) entitled to vote in respect of such action (or such larger proportion
thereof as shall be required by any express provision of this Trust Agreement)
shall consent to the action in writing.

 

Section 607                                   Record
Date for Voting and Other Purposes. 
For the purposes of determining the Securityholders who are entitled to
notice of and to vote at any meeting or by written consent, or to participate
in any distribution on the Trust Securities in respect of which a record date
is not otherwise provided for in this Trust Agreement, or for the purpose of
any other action, Administrative Trustees may from time to time fix a date, not
more than 90 days prior to the date of any meeting of Securityholders or the
payment of distribution or other action, as the case may be, as a record date
for the determination of the identity of the Securityholders of record for such
purposes.

 

Section 608                                   Acts
of Securityholders.  Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided or permitted by this Trust Agreement to be given, made or taken by
Securityholders or Owners may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Securityholders or
Owners in person or by an agent duly appointed in writing; and, except as
otherwise expressly provided herein, such action shall become effective when
such instrument or instruments are delivered to an Administrative Trustee.  Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the “Act” of the Securityholders or Owners signing such instrument or
instruments.  Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Trust Agreement and (subject to Section 801)
conclusive in favor of the Trustees, if made in the manner provided in this
Section.

 

The
fact and date of the execution by any Person of any such instrument or writing
may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such
instrument or writing acknowledged to him the execution thereof.  Where such execution is by a signer acting in
a capacity other than his individual capacity, such certificate or affidavit
shall also constitute sufficient proof of

 

30

 

his authority.  The fact and date
of the execution of any such instrument or writing, or the authority of the
Person executing the same, may also be proved in any other manner which any
Trustee receiving the same deems sufficient.

 

The
ownership of Preferred Securities shall be proved by the Securities Register.

 

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

 

Without
limiting the foregoing, a Securityholder entitled hereunder to take any action
hereunder with regard to any particular Trust Security may do so with regard to
all or any part of the Liquidation Amount of such Trust Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such liquidation amount.

 

If any
dispute shall arise between the Securityholders and the Administrative Trustees
or among such Securityholders or Trustees with respect to the authenticity,
validity or binding nature of any request, demand, authorization, direction,
consent, waiver or other Act of such Securityholder or Trustee under this Article VI,
then the dispute shall be submitted to an independent legal counsel which has
not provided significant services to any of the disputing parties in the past
two years (the “Independent Legal Counsel”), and reasonably satisfactory
to the disputing parties, for determination of such matter.  The Independent Legal Counsel’s determination
shall be conclusive and binding with respect to such matter.

 

Section 609                                   Inspection
of Records.  Upon reasonable notice
to the Administrative Trustees and the Property Trustee, the records of the
Trust shall be open to inspection by Securityholders during normal business
hours for any purpose reasonably related to such Securityholder’s interest as a
Securityholder.

 

ARTICLE SEVEN

 

Representations
and Warranties

 

Section 701                                   Representations
and Warranties of the Bank, the Property Trustee and the Delaware Trustee.  The Bank, the Property Trustee and the
Delaware Trustee, each severally on behalf of and as to itself, hereby
represents and warrants for the benefit of the Depositor and the
Securityholders that:

 

31

 

(1)                                  the
Bank is a banking corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware;

 

(2)                                  the
Bank has full corporate power, authority and legal right to execute, deliver
and perform its obligations under this Trust Agreement and has taken all
necessary action to authorize the execution, delivery and performance by it of
this Trust Agreement;

 

(3)                                  this
Trust Agreement has been duly authorized, executed and delivered by the Bank
and constitutes the valid and legally binding agreement of the Bank enforceable
against it in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors’ rights and to general equity
principles;

 

(4)                                  the
execution, delivery and performance by the Bank of this Trust Agreement have
been duly authorized by all necessary corporate or other action on the part of
the Bank and do not require any approval of stockholders of the Bank and such
execution, delivery and performance will not (i) violate the Bank’s
Charter or By-laws, (ii) violate any provision of, or constitute,
with or without notice or lapse of time, a default under, or result in the
creation or imposition of, any Lien on any properties included in the Trust
Property pursuant to the provisions of, any indenture, mortgage, credit
agreement, license or other agreement or instrument to which the Bank is a
party or by which it is bound (other than as contemplated by the Trust
Agreement, the Indenture and the Guarantee), or (iii) violate any
law, governmental rule or regulation of the United States or the State of
Delaware, as the case may be, governing the banking or trust powers of the Bank
or any order, judgment or decree applicable to the Bank;

 

(5)                                  the
execution, delivery and performance by the Property Trustee of this Trust
Agreement have been duly authorized by all necessary corporate or other action
on the part of the Property Trustee and do not require any approval of
stockholders of the Property Trustee and such execution, delivery and
performance will not (i) violate the Property Trustee’s Charter or
By-laws, (ii) violate any provision of, or constitute, with or
without notice or lapse of time, a default under, or result in the creation or
imposition of, any Lien on any properties included in the Trust Property
pursuant to the provisions of, any indenture, mortgage, credit agreement,
license or other agreement or instrument to which the Property Trustee is a
party or by which it is bound (other than as contemplated by the Trust
Agreement, the Indenture and the Guarantee), or (iii) violate any
law, governmental rule or regulation of the United States or the State of
Delaware, as the case may be, governing the banking or trust powers of the
Property Trustee or any order, judgment or decree applicable to the Property
Trustee;

 

32

 

(6)                                  the
execution, delivery and performance by the Delaware Trustee of this Trust
Agreement have been duly authorized by all necessary corporate or other action
on the part of the Delaware Trustee and do not require any approval of
stockholders of the Delaware Trustee and such execution, delivery and
performance will not (i) violate the Delaware Trustee’s Charter or
By-laws, (ii) violate any provision of, or constitute, with or without
notice or lapse of time, a default under, or result in the creation or
imposition of, any Lien on any properties included in the Trust Property
pursuant to the provisions of, any indenture, mortgage, credit agreement,
license or other agreement or instrument to which the Delaware Trustee is a
party or by which it is bound (other than as contemplated by the Trust
Agreement, the Indenture and the Guarantee), or (iii) violate any
law, governmental rule or regulation of the United States or the State of
Delaware, as the case may be, governing the banking or trust powers of the
Delaware Trustee or any order, judgment or decree applicable to the Delaware
Trustee;

 

(7)                                  neither
the authorization, execution or delivery by the Bank of this Trust Agreement
nor the consummation of any of the transactions by the Bank contemplated herein
or therein requires the consent or approval of, the giving of notice to, the
registration with or the taking of any other action with respect to any
governmental authority or agency under any existing federal law governing the
banking or trust powers of the Bank under the laws of the United States or the
State of Delaware (other than as contemplated by the Trust Agreement, the
Indenture and the Guarantee);

 

(8)                                  neither
the authorization, execution or delivery by the Property Trustee of this Trust
Agreement nor the consummation of any of the transactions by the Property
Trustee contemplated herein or therein requires the consent or approval of, the
giving of notice to, the registration with or the taking of any other action
with respect to any governmental authority or agency under any existing federal
law governing the banking or trust powers of the Property Trustee under the
laws of the United States or the State of Delaware (other than as contemplated
by the Trust Agreement, the Indenture and the Guarantee);

 

(9)                                  neither
the authorization, execution or delivery by the Delaware Trustee of this Trust
Agreement nor the consummation of any of the transactions by the Delaware
Trustee contemplated herein or therein requires the consent or approval of, the
giving of notice to, the registration with or the taking of any other action
with respect to any governmental authority or agency under any existing federal
law governing the banking or trust powers of the Delaware Trustee under the
laws of the United States or the State of Delaware (other than as contemplated
by the Trust Agreement, the Indenture and the Guarantee); and

 

33

 

(10)                            there
are no proceedings pending or, to the best of each of the Bank’s, the Property
Trustee’s and the Delaware Trustee’s knowledge, threatened against or affecting
the Bank, the Property Trustee or the Delaware Trustee in any court or before
any governmental authority, agency or arbitration board or tribunal which,
individually or in the aggregate, would materially and adversely affect the
Trust or would question the right, power and authority of the Bank to enter
into or perform its obligations as one of the Trustees under this Trust
Agreement.

 

Section 702                                   Representations
and Warranties of Depositor.  The
Depositor hereby represents and warrants for the benefit of the Securityholders
that:

 

(1)                                  the
Trust Securities Certificates issued on the Closing Date on behalf of the Trust
have been duly authorized and will have been, duly and validly executed, issued
and delivered by the Trustees pursuant to the terms and provisions of, and in
accordance with the requirements of, this Trust Agreement and the
Securityholders will be, as of such date, entitled to the benefits of this
Trust Agreement; and

 

(2)                                  there
are no taxes, fees or other governmental charges payable by the Trust (or the
Trustees on behalf of the Trust) under the laws of the State of Delaware or any
political subdivision thereof in connection with the execution, delivery and
performance by the Bank, the Property Trustee or the Delaware Trustee, as the
case may be, of this Trust Agreement.

 

ARTICLE EIGHT

 

The Trustees

 

Section 801                                   Certain Duties
and Responsibilities.

 

(1)                                  The
duties and responsibilities of the Trustees shall be as provided by this Trust
Agreement and, in the case of the Property Trustee, by the Trust Indenture
Act.  Notwithstanding the foregoing, no
provision of this Trust Agreement shall require the Trustees to expend or risk
their own funds or otherwise incur any financial liability in the performance
of any of their duties hereunder, or in the exercise of any of their rights or
powers, if they shall have reasonable grounds for believing that repayment of
such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.  Whether or not
therein expressly so provided, every provision of this Trust Agreement relating
to the conduct or affecting the liability of or affording protection to the
Trustees shall be subject to the provisions of this Section.  Nothing in this Trust Agreement shall be
construed to release the Property Trustee from liability for its own negligent
action, its own failure to act, or its own willful misconduct.  To the extent that, at law or in equity, an
Administrative Trustee has duties (including fiduciary duties) and liabilities
relating

 

34

 

thereto to the Trust or to the Securityholders, such Administrative
Trustee shall not be liable to the Trust or to any Securityholder for such
Trustee’s good faith reliance on the provisions of this Trust Agreement.  The provisions of this Trust Agreement, to
the extent that they restrict the duties and liabilities of the Administrative
Trustees otherwise existing at law or in equity, are agreed by the Depositor
and the Securityholders to replace such other duties and liabilities of the
Administrative Trustees.

 

(2)                                  All
payments made by the Property Trustee or a Paying Agent in respect of the Trust
Securities shall be made only from the revenue and proceeds from the Trust
Property and only to the extent that there shall be sufficient revenue or
proceeds from the Trust Property to enable the Property Trustee or a Paying
Agent to make payments in accordance with the terms hereof.  Each Securityholder, by its acceptance of a
Trust Security, agrees that it will look solely to the revenue and proceeds
from the Trust Property to the extent legally available for distribution to it
as herein provided and that the Trustees are not personally liable to it for
any amount distributable in respect of any Trust Security or for any other
liability in respect of any Trust Security. 
This Section 801(2) does not limit the liability of the
Trustees expressly set forth elsewhere in this Trust Agreement or, in the case
of the Property Trustee, in the Trust Indenture Act.

 

(3)                                  No
provision of this Trust Agreement shall be construed to relieve the Property
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that:

 

(a)                                  the
Property Trustee shall not be liable for any error of judgment made in good
faith by an authorized officer of the Property Trustee, unless it shall be proved
that the Property Trustee was negligent in ascertaining the pertinent facts;

 

(b)                                 the
Property Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the
holders of not less than a majority in Liquidation Amount of the Trust
Securities relating to the time, method and place of conducting any proceeding
for any remedy available to the Property Trustee, or exercising any trust or
power conferred upon the Property Trustee under this Trust Agreement;

 

(c)                                  the
Property Trustee’s sole duty with respect to the custody, safe keeping and
physical preservation of the Debentures and the Payment Account shall be to
deal with such Property in a similar manner as the Property Trustee deals with
similar property for its own account, subject to the protections and
limitations on liability afforded to the Property Trustee under this Trust
Agreement and the Trust Indenture Act;

 

(d)                                 the
Property Trustee shall not be liable for any interest on any money received by
it except as it may otherwise agree with the Depositor.  Money

 

35

 

held by the Property Trustee need not be segregated
from other funds held by it except in relation to the Payment Account
maintained by the Property Trustee pursuant to Section 301 and except to
the extent otherwise required by law; and

 

(e)                                  the
Property Trustee shall not be responsible for monitoring the compliance by the
Administrative Trustees or the Depositor with their respective duties under
this Trust Agreement, nor shall the Property Trustee be liable for the default
or misconduct of the Administrative Trustees or the Depositor.

 

Section 802                                   Notice
of Defaults.  Within five Business
Days after the occurrence of any Event of Default actually known to a
Responsible Officer of the Property Trustee, the Property Trustee shall
transmit, in the manner and to the extent provided in Section 1008, notice
of such Event of Default to the Securityholders, the Administrative Trustees
and the Depositor, unless such Event of Default shall have been cured or
waived.

 

Within
five Business Days after the receipt of notice of the Depositor’s exercise of
its right to extend the interest payment period for the Debentures pursuant to
the Indenture, the Administrative Trustee shall transmit, in the manner and to
the extent provided in Section 1008, notice of such exercise to the
Securityholders and the Property Trustee, unless such exercise shall have been
revoked.

 

Section 803                                   Certain Rights of
Property Trustee.  Subject to the
provisions of Section 801:

 

(1)                                  the
Property Trustee may rely and shall be protected in acting or refraining from
acting in good faith upon any resolution, Opinion of Counsel, certificate,
written representation of a Holder or transferee, certificate of auditors or
any other certificate, statement, instrument, opinion, report, notice, request,
consent, order, appraisal, bond, debenture, note, other evidence of
indebtedness or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties;

 

(2)                                  if,
(i) in performing its duties under this Trust Agreement the
Property Trustee is required to decide between alternative courses of action or
(ii) in construing any of the provisions in this Trust Agreement
the Property Trustee finds the same ambiguous or inconsistent with any other
provisions contained herein or (iii) the Property Trustee is unsure
of the application of any provision of this Trust Agreement, then, except as to
any matter as to which the Preferred Securityholders are entitled to vote under
the terms of this Trust Agreement, the Property Trustee shall deliver a notice
to the Depositor requesting written instructions of the Depositor as to the
course of action to be taken.  The
Property Trustee shall take such action, or refrain from taking such action, as
the Property Trustee shall be instructed in writing to take, or to refrain from
taking,

 

36

 

by the Depositor; provided, however,
that if the Property Trustee does not receive such instructions of the
Depositor within ten Business Days after it has delivered such notice, or such
reasonably shorter period of time set forth in such notice (which to the extent
practicable shall not be less than two Business Days), it may, but shall be
under no duty to, take or refrain from taking such action not inconsistent with
this Trust Agreement as it shall deem advisable and in the best interests of
the Securityholders, in which event the Property Trustee shall have no
liability except for its own bad faith, negligence or willful misconduct;

 

(3)                                  any
direction or act of the Depositor or the Administrative Trustees contemplated
by this Trust Agreement shall be sufficiently evidenced by an Officer’s
Certificate;

 

(4)                                  whenever
in the administration of this Trust Agreement, the Property Trustee shall deem
it desirable that a matter be established before undertaking, suffering or
omitting any action hereunder, the Property Trustee (unless other evidence is
herein specifically prescribed) may, in the absence of bad faith on its part,
request and rely upon an Officer’s Certificate which, upon receipt of such
request, shall be promptly delivered by the Depositor or the Administrative
Trustees;

 

(5)                                  the
Property Trustee shall have no duty to see to any recording, filing or
registration of any instrument (including any financing or continuation
statement or any filing under tax or securities laws) or any rerecording,
refiling or reregistration thereof;

 

(6)                                  the
Property Trustee may consult with counsel and the advice of such counsel shall
be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance thereon
and in accordance with such advice, such counsel may be counsel to the
Depositor or any of its Affiliates, and may include any of its employees.  The Property Trustee shall have the right at
any time to seek instructions concerning the administration of this Trust
Agreement from any court of competent jurisdiction;

 

(7)                                  the
Property Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Trust Agreement at the request or direction of any
of the Securityholders pursuant to this Trust Agreement, unless such
Securityholders shall have offered to the Property Trustee reasonable security
or indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;

 

(8)                                  the
Property Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument,

 

37

 

opinion, report, notice, request, consent, order,
approval, bond, debenture, note or other evidence of indebtedness or other
paper or document, unless requested in writing to do so by one or more
Securityholders, but the Property Trustee may make such further inquiry or
investigation into such facts or matters as it may see fit;

 

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

 

(10)                            whenever
in the administration of this Trust Agreement the Property Trustee shall deem
it desirable to receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder the Property Trustee (i) may
request instructions from the Holders of the Trust Securities which
instructions may only be given by the Holders of the same proportion in
Liquidation Amount of the Trust Securities as would be entitled to direct the
Property Trustee under the terms of the Trust Securities in respect of such
remedy, right or action, (ii) may refrain from enforcing such
remedy or right or taking such other action until such instructions are
received, and (iii) shall be fully protected in acting in
accordance with such instructions;

 

(11)                            except
as otherwise expressly provided by this Trust Agreement, the Property Trustee
shall not be under any obligation to take any action that is discretionary
under the provisions of this Trust Agreement; and

 

(12)                            the
Property Trustee shall not be charged with knowledge of an Event of Default
unless a Responsible Officer of the Property Trustee obtains actual knowledge
of such event or the Property Trustee receives written notice of such event
from any Securityholder, the Depositor or the Debenture Trustee.

 

No
provision of this Trust Agreement shall be deemed to impose any duty or
obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any
jurisdiction in which it shall be illegal, or in which the Property Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or
obligation.  No permissive power or
authority available to the Property Trustee shall be construed to be a duty.

 

Section 804                                   Not
Responsible for Recitals or Issuance of Securities.  The recitals contained herein and in the
Trust Securities Certificates shall be taken as the statements of the Trust,
and the Trustees do not assume any responsibility for their

 

38

 

correctness.  The Trustees shall
not be accountable for the use or application by the Depositor of the proceeds
of the Debentures.

 

Section 805                                   May Hold
Securities.  Any Trustee or any other
agent of any Trustee or the Trust, in its individual or any other capacity, may
become the owner or pledgee of Trust Securities and, subject to Sections 808
and 813 and except as provided in the definition of the term “Outstanding” in Article I,
may otherwise deal with the Trust with the same rights it would have if it were
not a Trustee or such other agent.

 

Section 806                                  Compensation;
Indemnity; Fees.  The Depositor
agrees:

 

(1)                                  to
pay to the Trustees from time to time reasonable compensation for all services
rendered by them hereunder (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust);

 

(2)                                  except
as otherwise expressly provided herein, to reimburse the Trustees upon request
for all reasonable expenses, disbursements and advances incurred or made by the
Trustees in accordance with any provision of this Trust Agreement (including
the reasonable compensation and the expenses and disbursements of its agents
and counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith;

 

(3)                                  to
indemnify each of the Trustees (including in their individual capacities) and
their officers, directors and employees or any predecessor Trustee for, and to
hold the Trustees harmless against, any loss, damage, claims, liability,
penalty or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of this
Trust Agreement, including the costs and expenses of defending itself against
any claim or liability in connection with the exercise or performance of any of
its powers or duties hereunder (collectively, “Expenses”); and

 

(4)                                  to
the fullest extent permitted by law, the Expenses (including reasonable
attorneys’ fees and expenses) incurred by a Trustee referred to in paragraph (c) of
this Section 806 shall be paid by the Depositor in advance upon receipt of
an undertaking by or on behalf of such Trustee to repay such amount if it shall
ultimately be determined that such Trustee is not entitled to be indemnified by
the Depositor as authorized in this Section 806.

 

No
Trustee may claim any lien or charge on any Trust Property as a result of any
amount due pursuant to this Section 806.

 

39

 

Section 807            Corporate
Property Trustee Required; Eligibility of Trustees.

 

(1)           There shall at all times be a
Property Trustee hereunder with respect to the Trust Securities.  The Property Trustee 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 $50,000,000.  If any such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of its
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 Property
Trustee with respect to the Trust Securities shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.

 

(2)           There shall at all times be one or
more Administrative Trustees hereunder with respect to the Trust
Securities.  Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more persons authorized to bind that
entity.

 

(3)           There shall at all times be a
Delaware Trustee with respect to the Trust Securities.  The Delaware Trustee shall either be (i) a
natural person who is at least 21 years of age and a resident of the State of
Delaware or (ii) a legal entity with its principal place of business
in the State of Delaware and that otherwise meets the requirements of
applicable Delaware law that shall act through one or more persons authorized
to bind such entity.

 

Section 808            Conflicting Interests.  If the Property Trustee has or shall acquire
a conflicting interest within the meaning of the Trust Indenture Act, the
Property 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 Trust Agreement.

 

Section 809            Co-Trustees and Separate Trustee.  Unless an Event of Default shall have
occurred and be continuing, at any time or times, for the purpose of meeting
the legal requirements of the Trust Indenture Act or of any jurisdiction in which
any part of the Trust Property may at the time be located, the Depositor and
the Administrative Trustees, by agreed action of the majority of such Trustees,
shall have power to appoint, and upon the written request of the Administrative
Trustees, the Depositor shall for such purpose join with the Administrative
Trustees in the execution, delivery, and performance of all instruments and
agreements necessary or proper to appoint, one or more Persons approved by the
Property Trustee either to act as co-trustee, jointly with the Property
Trustee, of all or any part of such Trust Property, or to the extent required
by law to act as separate trustee of any such property, in either case with
such powers as may be provided in the instrument of appointment, and to vest in
such Person or Persons in the capacity aforesaid, any property, title, right or
power deemed necessary or desirable,

 

40

 

subject to the other provisions of this Section.  If the Depositor does not join in such
appointment within 15 days after the receipt by it of a request so to do, or in
case a Debenture Event of Default has occurred and is continuing, the Property
Trustee alone shall have power to make such appointment.  Any co-trustee or separate trustee appointed
pursuant to this Section shall either be (i) a natural person
who is at least 21 years of age and a resident of the United States or (ii) a
legal entity with its principal place of business in the United States that
shall act through one or more persons authorized to bond such entity.

 

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

 

Every
co-trustee or separate trustee shall, to the extent permitted by law, but to
such extent only, be appointed subject to the following terms, namely:

 

(1)           The Trust Securities shall be
executed and delivered and all rights, powers, duties, and obligations
hereunder in respect of the custody of securities, cash and other personal
property held by, or required to be deposited or pledged with, the Trustees
specified hereunder, shall be exercised, solely by such Trustees and not by
such co-trustee or separate trustee.

 

(2)           The rights, powers, duties, and
obligations hereby conferred or imposed upon the Property Trustee in respect of
any property covered by such appointment shall be conferred or imposed upon and
exercised or performed by the Property Trustee or by the Property Trustee and
such co-trustee or separate trustee jointly, as shall be provided in the
instrument appointing such co-trustee or separate trustee, except to the extent
that under any law of any jurisdiction in which any particular act is to be
performed, the Property Trustee shall be incompetent or unqualified to perform
such act, in which event such rights, powers, duties, and obligations shall be
exercised and performed by such co-trustee or separate trustee.

 

(3)           The Property Trustee at any time, by
an instrument in writing executed by it, with the written concurrence of the
Depositor, may accept the resignation of or remove any co-trustee or separate
trustee appointed under this Section, and, in case an Event of Default under
the Indenture has occurred and is continuing, the Property Trustee shall have
power to accept the resignation of, or remove, any such co-trustee or separate
trustee without the concurrence of the Depositor.  Upon the written request of the Property
Trustee, the Depositor shall join with the Property Trustee in the execution,
delivery, and performance of all instruments and agreements necessary or proper
to effectuate such resignation or

 

41

 

removal.  A
successor to any co-trustee or separate trustee so resigned or removed may be
appointed in the manner provided in this Section.

 

(4)           No co-trustee or separate trustee
hereunder shall be personally liable by reason of any act or omission of the
Property Trustee, or any other trustee hereunder.

 

(5)           The Property Trustee shall not be
liable by reason of any act of a co-trustee or separate trustee.

 

(6)           Any Act of Holders delivered to the
Property Trustee shall be deemed to have been delivered to each such co-trustee
and separate trustee.

 

Section 810            Resignation and Removal;
Appointment of Successor.  No
resignation or removal of any Trustee (the “Relevant Trustee”) and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 811.

 

Any
Trustee may resign at any time with respect to the Trust Securities by giving
written notice thereof to the Securityholders. 
If the instrument of acceptance by the successor Trustee required by Section 811
shall not have been delivered to the Relevant Trustee within 30 days after the
giving of such notice of resignation, the Relevant Trustee may petition, at the
expense of the Depositor, any court of competent jurisdiction for the
appointment of a successor Relevant Trustee with respect to the Trust
Securities.

 

Unless
a Debenture Event of Default shall have occurred and be continuing, any Trustee
may be removed at any time by Act of the Common Securityholder.  If a Debenture Event of Default shall have
occurred and be continuing, the Property Trustee or the Delaware Trustee, or
both of them, may be removed at such time by Act of the Holders of a majority
in Liquidation Amount of the Preferred Securities, delivered to the Relevant
Trustee (in its individual capacity and on behalf of the Trust).  An Administrative Trustee may be removed by
the Common Securityholder at any time.

 

If any
Trustee shall resign, be removed or become incapable of acting as Trustee, or
if a vacancy shall occur in the office of any Trustee for any cause, at a time
when no Debenture Event of Default shall have occurred and be continuing, the
Common Securityholder, by Act of the Common Securityholder delivered to the
retiring Trustee, shall promptly appoint a successor Trustee or Trustees with
respect to the Trust Securities and the Trust, and the retiring Trustee shall
comply with the applicable requirements of Section 811.  If the Property Trustee or the Delaware
Trustee shall resign, be removed or become incapable of continuing to act as
the Property Trustee or the Delaware Trustee, as the case may be, at a time when
a Debenture Event of Default is continuing, the Preferred Securityholders, by
Act of the Securityholders of a majority in Liquidation Amount of the 

 

42

 

Preferred Securities then Outstanding delivered to the retiring
Relevant Trustee, shall promptly appoint a successor Relevant Trustee or
Trustees with respect to the Trust Securities and the Trust, and such successor
Trustee shall comply with the applicable requirements of Section 811.  If an Administrative Trustee shall resign, be
removed or become incapable of acting as Administrative Trustee, at a time when
a Debenture Event of Default shall have occurred and be continuing, the Common
Securityholder shall appoint a successor or Administrative Trustees.  If no successor Relevant Trustee with respect
to the Trust Securities shall have been so appointed by the Common
Securityholder or the Preferred Securityholders and accepted appointment in the
manner required by Section 811, any Securityholder who has been a
Securityholder of Trust Securities for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Relevant Trustee with respect
to the Trust Securities.

 

The
Property Trustee shall give notice of each resignation and each removal of a
Trustee and each appointment of a successor Trustee to all Securityholders in
the manner provided in Section 1008 and shall give notice to the
Depositor, in each case promptly upon receipt by it of notice of such
resignation.  Each notice shall include
the name of the successor Relevant Trustee and the address of its Corporate
Trust Office if it is the Property Trustee.

 

Notwithstanding
the foregoing or any other provision of this Trust Agreement, in the event any
Administrative Trustee or a Delaware Trustee who is a natural person dies or
becomes, in the opinion of the Depositor, incompetent or incapacitated, the
vacancy created by such death, incompetence or incapacity may be filled by (a) the
unanimous act of remaining Administrative Trustees if there are at least two of
them or (b) otherwise by the Depositor (with the successor in each
case being a Person who satisfies the eligibility requirement for
Administrative Trustees set forth in Section 807).

 

Section 811            Acceptance of Appointment by
Successor.  In case of the
appointment hereunder of a successor Trustee, such successor Trustee so
appointed shall execute, acknowledge and deliver to the Trust and to the
retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee;
but, on the request of the Depositor or the successor Trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee and if the Property Trustee is the resigning Trustee shall
duly assign, transfer and deliver to the successor Trustee all property and
money held by such retiring Property Trustee hereunder.

 

In
case of the appointment hereunder of a successor Relevant Trustee with respect
to the Trust Securities and the Trust, the retiring Relevant Trustee (if
requested by the

 

43

 

Depositor) and each successor Relevant Trustee with respect to the
Trust Securities shall execute and deliver an amendment hereto wherein each
successor Relevant Trustee shall accept such appointment and which (a) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Relevant Trustee all the rights,
powers, trusts and duties of the retiring Relevant Trustee with respect to the
Trust Securities and the Trust and (b) shall add to or change any
of the provisions of this Trust Agreement as shall be necessary to provide for
or facilitate the administration of the trusts hereunder by more than one
Relevant Trustee, it being understood that nothing herein or in such amendment
shall constitute such Relevant Trustees co-trustees of the same trust and that
each such Relevant Trustee shall be trustee of a trust or trusts hereunder
separate and apart from any trust or trusts hereunder administered by any other
such Relevant Trustee and upon the execution and delivery of such amendment the
resignation or removal of the retiring Relevant Trustee shall become effective
to the extent provided therein and each such successor Relevant Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Relevant Trustee with respect
to the Trust Securities and the Trust; but, on request of the Trust or any
successor Relevant Trustee such retiring Relevant Trustee shall duly assign,
transfer and deliver to such successor Relevant Trustee all Trust Property, all
proceeds thereof and money held by such retiring Relevant Trustee hereunder
with respect to the Trust Securities and the Trust.

 

Upon
request of any such successor Relevant Trustee, the Trust shall execute any and
all instruments for more fully and certainly vesting in and confirming to such
successor Relevant Trustee all such rights, powers and trusts referred to in
the first or second preceding paragraph, as the case may be.

 

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

 

Section 812            Merger, Conversion, Consolidation
or Succession to Business.  Any
corporation into which the Property Trustee, the Delaware Trustee or any
Administrative Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which such Relevant Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of such Relevant Trustee, shall be the successor of such Relevant Trustee
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article, without the execution or filing of any paper or any further
act on the part of any of the parties hereto.

 

Section 813            Preferential Collection of Claims
Against Depositor or Trust.  If and
when the Property Trustee or the Delaware Trustee shall be or become a creditor
of the Depositor or the Trust (or any other obligor upon the Debentures or the
Trust Securities), the Property Trustee or the Delaware Trustee, as the case
may be, shall be

 

44

 

subject to and shall take all actions necessary in order to comply with
the provisions of the Trust Indenture Act regarding the collection of claims
against the Depositor or Trust (or any such other obligor).

 

Section 814            Reports
by Property Trustee.

 

(1)           Within 60 days after December 31
of each year commencing with December 31,                    
the Property Trustee shall transmit to all Securityholders in accordance with Section 1008,
and to the Depositor, a brief report dated as of such December 31 with
respect to:

 

(a)           its eligibility under Section 807
or, in lieu thereof, if to the best of its knowledge it has continued to be
eligible under said Section, a written statement to such effect;

 

(b)           a statement that the Property Trustee
has complied with all of its obligations under this Trust Agreement during the
twelve-month period (or, in the case of the initial report, the period since
the Closing Date) ending with such December 31 or, if the Property Trustee
has not complied in any material respect with such obligations, a description
of such noncompliance; and

 

(c)           any change in the property and funds
in its possession as Property Trustee since the date of its last report and any
action taken by the Property Trustee in the performance of its duties hereunder
which it has not previously reported and which in its opinion materially
affects the Trust Securities.

 

(2)           In addition the Property Trustee
shall transmit to Securityholders and the Depositor such reports concerning the
Property Trustee and its actions under this Trust Agreement as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant thereto.

 

(3)           A copy of each such report shall, at
the time of such transmission to the Depositor, be filed by the Depositor with
each stock exchange upon which the Trust Securities are listed and with the
Commission.

 

Section 815            Reports to the Property Trustee.  The Depositor and the Administrative Trustees
on behalf of the Trust shall provide to the Property Trustee such documents,
reports and information as required by Section 3.14 of the Trust Indenture
Act (if any) and the compliance certificate required by Section 3.14(a) of
the Trust Indenture Act in the form, in the manner and at the times required by
Section 3.14 of the Trust Indenture Act.

 

Section 816            Evidence of Compliance with
Conditions Precedent.  Each of the
Depositor and the Administrative Trustees on behalf of the Trust shall provide
to the

 

45

 

Property Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Trust Agreement that relate to any of
the matters set forth in Section 3.14(c) of the Trust Indenture
Act.  Any certificate or opinion required
to be given by an officer pursuant to Section 3.14(c)(1) of the Trust
Indenture Act shall be given in the form of an Officers’ Certificate.

 

Section 817            Number
of Trustees.

 

(1)           The number of Trustees shall be four,
provided that the Holder of all of the Common Securities by written instrument
may increase or decrease the number of Administrative Trustees.

 

(2)           If a Trustee ceases to hold office
for any reason and the number of Administrative Trustees is not reduced
pursuant to Section 817(1), or if the number of Trustees is increased
pursuant to Section 817(1), a vacancy shall occur.  The vacancy shall be filled with a Trustee
appointed in accordance with Section 810.

 

(3)           The death, resignation, retirement,
removal, bankruptcy, incompetence or incapacity to perform the duties of a
Trustee shall not operate to annul, dissolve or terminate the Trust.  Whenever a vacancy in the number of
Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 810,
the Administrative Trustees in office, regardless of their number (and
notwithstanding any other provision of this Trust Agreement), shall have all
the powers granted to the Administrative Trustees and shall discharge all the
duties imposed upon the Administrative Trustees by this Trust Agreement.

 

Section 818            Delegation
of Power.

 

(1)           Any Administrative Trustee may, by
power of attorney consistent with applicable law, delegate to any other natural
person over the age of 21 his or her power for the purpose of executing any
documents contemplated in Section 207(1), including any registration
statement or amendment thereto filed with the Commission, or making any other
governmental filing; and

 

(2)           The Administrative Trustees shall
have power to delegate from time to time to such of their number or to the
Depositor the doing of such things and the execution of such instruments either
in the name of the Trust or the names of the Administrative Trustees or
otherwise as the Administrative Trustees may deem expedient, to the extent such
delegation is not prohibited by applicable law or contrary to the provisions of
the Trust, as set forth herein.

 

46

 

ARTICLE NINE

 

Dissolution,
Liquidation and Merger

 

Section 901            Dissolution Upon Expiration Date.  Unless earlier dissolved, the Trust shall
automatically dissolve on                     ,
             (the “Expiration
Date”), following the distribution of the Trust Property in accordance with
Section 904.

 

Section 902            Early Dissolution.  The first to occur of any of the following
events is an “Early Termination Event”, upon the occurrence of which the Trust
shall be dissolved:

 

(1)           the occurrence of a Bankruptcy Event
in respect of, or the dissolution or liquidation of, the Depositor;

 

(2)           the occurrence of a Tax Event or an
Investment Company Event (each, a “Special Event”), or the Trust is or
will not be taxed as a grantor trust but a Tax Event has not occurred (a “Grantor
Trust Event”), and written direction is given to the Property Trustee from
the Depositor within 45 days of such Special Event or Grantor Trust Event
(which direction is optional and wholly within the discretion of the Depositor)
to dissolve the Trust and distribute Debentures to Securityholders in
accordance with Section 904;

 

(3)           the redemption of all of the
Preferred Securities; and

 

(4)           an order for dissolution of the Trust
shall have been entered by a court of competent jurisdiction.

 

Section 903            Termination.  The respective obligations and
responsibilities of the Trustees and the Trust created and continued hereby
shall terminate upon the latest to occur of the following:

 

(1)           the distribution by the Property
Trustee to Securityholders upon the liquidation of the Trust pursuant to Section 904,
or upon the redemption of all of the Trust Securities pursuant to Section 402,
of all amounts required to be distributed hereunder upon the final payment of
the Trust Securities;

 

(2)           the payment of any expenses owed by
the Trust; and

 

(3)           the discharge of all administrative
duties of the Administrative Trustees, including the performance of any tax
reporting obligations with respect to the Trust or the Securityholders.

 

47

 

Section 904            Liquidation.

 

(1)           If an Early Termination Event
specified in clause (1), (2) or (4) of Section 902 occurs or
upon the Expiration Date, the Trust shall be liquidated by the Trustees as
expeditiously as the Trustees determine to be possible by distributing, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, to each Securityholder a Like Amount of Debentures, subject to Section 904(4).  Notice of liquidation shall be given by the
Property Trustee by first-class mail, postage prepaid, mailed not later than 30
nor more than 60 days prior to the Liquidation Date to each Holder of Trust
Securities at such Holder’s address appearing in the Securities Register.  All notices of liquidation shall:

 

(a)           state the Liquidation Date;

 

(b)           state that from and after the
Liquidation Date, the Trust Securities will no longer be deemed to be
outstanding and any Trust Securities Certificates not surrendered for exchange
will be deemed to represent a Like Amount of Debentures; and

 

(c)           provide such information with respect
to the mechanics by which Holders may exchange Trust Securities Certificates
for Debentures, or if Section 904(4) applies receive a Liquidation
Distribution, as the Administrative Trustees or the Property Trustee shall deem
appropriate.

 

(2)           Except
where Section 902(3) or 904(4) applies, in order to effect the
liquidation of the Trust and distribution of the Debentures to Securityholders,
the Property Trustee shall establish a record date for such distribution (which
shall be not more than 45 days prior to the Liquidation Date) and, either
itself acting as exchange agent or through the appointment of a separate
exchange agent, shall establish such procedures as it shall deem appropriate to
effect the distribution of Debentures in exchange for the Outstanding Trust
Securities Certificates.

 

(3)           Except
where Section 902(3) or 904(4) applies, after the Liquidation
Date, (i) the Trust Securities will no longer be deemed to be
outstanding, (ii) certificates representing a Like Amount of
Debentures will be issued to holders of Trust Securities Certificates, upon
surrender of such certificates to the Administrative Trustees or their agent
for exchange, (iii) the Depositor shall use its reasonable efforts
to have the Debentures listed on the New York Stock Exchange or on such other
exchange as the Preferred Securities are then listed, (iv) any
Trust Securities Certificates not so surrendered for exchange will be deemed to
represent a Like Amount of Debentures, accruing interest at the rate provided
for in the Debentures from the last Distribution Date on which a Distribution
was made on such Trust Certificates until such certificates are so surrendered
(and until such certificates are so surrendered, no payments or interest or
principal will be made to holders of Trust Securities Certificates with respect
to such

 

48

 

Debentures) and (iv) all rights of Securityholders holding
Trust Securities will cease, except the right of such Securityholders to
receive Debentures upon surrender of Trust Securities Certificates.

 

(4)           In the event that, notwithstanding
the other provisions of this Section 904, whether because of an order for
dissolution entered by a court of competent jurisdiction or otherwise,
distribution of the Debentures in the manner provided herein is determined by
the Property Trustee not to be practical, the Trust Property shall be
liquidated, and the Trust shall be wound-up by the Property Trustee in such
manner as the Property Trustee determines. 
In such event, Securityholders will be entitled to receive out of the
assets of the Trust available for distribution to Securityholders, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, an amount equal to the Liquidation Amount per Trust Security plus accrued
and unpaid Distributions thereon to the date of payment (such amount being the “Liquidation
Distribution”).  If, upon any such
winding up the Liquidation Distribution can be paid only in part because the
Trust has insufficient assets available to pay in full the aggregate
Liquidation Distribution, then, subject to the next succeeding sentence, the
amounts payable by the Trust on the Trust Securities shall be paid on a pro
rata basis (based upon Liquidation Amounts). 
The Holder of the Common Securities will be entitled to receive
Liquidation Distributions upon any such dissolution, winding-up or termination
pro rata (determined as aforesaid) with Holders of Preferred Securities, except
that, if a Debenture Event of Default has occurred and is continuing, the
Preferred Securities shall have a priority over the Common Securities.

 

Section 905            Mergers, Consolidations,
Amalgamations or Replacements of the Trust. 
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except pursuant
to this Section 905 or Section 904. 
At the request of the Depositor, with the consent of the Administrative
Trustees and without the consent of the holders of the Preferred Securities,
the Trust may merge with or into, consolidate, amalgamate, or be replaced by a
trust organized as such under the laws of any State; provided, that (i) such
successor entity either (a) expressly assumes all of the
obligations of the Trust with respect to the Preferred Securities or (b) substitutes
for the Preferred Securities other securities having substantially the same
terms as the Preferred Securities (the “Successor Securities”) so long
as the Successor Securities rank the same as the Preferred Securities rank in
priority with respect to distributions and payments upon liquidation,
redemption and otherwise, (ii) the Depositor expressly appoints a
trustee of such successor entity possessing the same powers and duties as the Property
Trustee as the holder of the Debentures, (iii) the Successor
Securities are listed, or any Successor Securities will be listed upon
notification of issuance, on any national securities exchange or other
organization on which the Preferred Securities are then listed, if any, (iv) such
merger, consolidation, amalgamation or replacement does not cause the Preferred
Securities (including any Successor Securities) to be downgraded by any
nationally recognized statistical rating organization, (v) such merger,
consolidation,

 

49

 

amalgamation or replacement does not adversely affect the rights,
preferences and privileges of the holders of the Preferred Securities
(including any Successor Securities) in any material respect, (vi) such
successor entity has a purpose substantially identical to that of the Trust, (vii) prior
to such merger, consolidation, amalgamation or replacement, the Depositor has
received an Opinion of Counsel to the effect that (a) such merger,
consolidation, amalgamation or replacement does not adversely affect the
rights, preferences and privileges of the holders of the Preferred Securities
(including any Successor Securities) in any material respect and (b) following
such merger, consolidation, amalgamation or replacement, neither the Trust nor
such successor entity will be required to register as an investment company
under the 1940 Act and (viii) the Depositor owns all of the common
securities of such successor entity and guarantees the obligations of such
successor entity under the Successor Securities at least to the extent provided
by the Guarantee.  Notwithstanding the
foregoing, the Trust shall not, except with the consent of holders of 100% in Liquidation
Amount of the Preferred Securities, consolidate, amalgamate, merge with or
into, or be replaced by any other entity or permit any other entity to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger or replacement would cause the Trust or the
successor entity to be classified as other than a grantor trust for federal
income tax purposes.

 

ARTICLE TEN

 

Miscellaneous
Provisions

 

Section 1001          Limitation of Rights of
Securityholders.  The death or
incapacity of any Person having an interest, beneficial or otherwise, in Trust
Securities shall not operate to terminate this Trust Agreement, nor annul,
dissolve or terminate the Trust, nor entitle the legal representatives or heirs
of such person or any Securityholder for such person, to claim an accounting,
take any action or bring any proceeding in any court for a partition or winding
up of the arrangements contemplated hereby, nor otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.

 

Section 1002          Amendment.

 

(1)           This Trust Agreement may be amended
from time to time by the Administrative Trustees and the Depositor, without the
consent of any Securityholders, (i) to cure any ambiguity, correct
or supplement any provision herein or therein which may be inconsistent with
any other provision herein or therein, or to make any other provisions with
respect to matters or questions arising under this Trust Agreement, which shall
not be inconsistent with the other provisions of this Trust Agreement, or (ii) to
modify, eliminate or add to any provisions of this Trust Agreement to such
extent as shall be necessary to ensure that the Trust will be classified for
Federal income tax purposes as a grantor trust at all times that any Trust
Securities are outstanding or to ensure that the Trust will not be required to
register as an “investment company” under the 1940 Act;

 

50

 

provided, however, that in the case of clause (i), such action
shall not adversely affect in any material respect the interests of any
Securityholder, and any such amendments of this Trust Agreement shall become
effective when notice thereof is given to the Securityholders.

 

(2)           Except as provided in Section 1002(3) hereof,
any provision of this Trust Agreement may be amended by the Administrative
Trustees and the Depositor with (i) the consent of Trust
Securityholders representing not less than a majority (based upon Liquidation
Amounts) of the Trust Securities then Outstanding and (ii) receipt
by the Trustees of an Opinion of Counsel to the effect that such amendment or
the exercise of any power granted to the Trustees in accordance with such
amendment will not affect the Trust’s status as a grantor trust for federal
income tax purposes or the Trust’s exemption from status of an “investment
company” under the 1940 Act.

 

(3)           In addition to and notwithstanding
any other provision in this Trust Agreement, without the consent of each
affected Securityholder, this Trust Agreement may not be amended to (i) change
the amount or timing of any Distribution on the Trust Securities or otherwise
adversely affect the amount of any Distribution required to be made in respect
of the Trust Securities as of a specified date or (ii) restrict the
right of a Securityholder to institute suit for the enforcement of any such
payment on or after such date; notwithstanding any other provision herein
without the unanimous consent of the Securityholders, this paragraph (3) of
this Section 1002 may not be amended.

 

(4)           Notwithstanding any other provisions
of this Trust Agreement, no Trustee shall enter into or consent to any
amendment to this Trust Agreement which would cause the Trust to fail or cease
to qualify for the exemption from status of an “investment company” under the
1940 Act.

 

(5)           Notwithstanding anything in this
Trust Agreement to the contrary, without the consent of the Depositor, this
Trust Agreement may not be amended in a manner which imposes any additional
obligation on the Depositor.

 

(6)           In the event that any amendment to
this Trust Agreement is made, the Administrative Trustees shall promptly
provide to the Depositor a copy of such amendment.

 

(7)           No amendment to this Trust Agreement
shall be adopted that affects the Property Trustee’s or the Delaware Trustee’s
rights, duties or immunities under this Trust Agreement without the consent of
the Property Trustee or the Delaware Trustee, as the case may be.  The Property Trustee shall be entitled to
receive and conclusively rely on an Opinion of Counsel and an Officer’s Certificate
stating that any amendment to this Trust Agreement is in compliance with this
Trust Agreement.

 

51

 

Section 1003          Separability.  In case any provision in this Trust Agreement
or in the Trust Securities Certificates shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.

 

Section 1004          Governing Law.  This Trust Agreement and the rights and
obligations of each of the Securityholders, the Trust and the Trustees with
respect to this Trust Agreement and the Trust Securities shall be construed in
accordance with and governed by the laws of the State of Delaware without
regard to principles of conflicts of laws.

 

Section 1005          Payments Due on
Non-Business Day.  If the date fixed
for any payment on any Trust Security shall be a day which is not a Business
Day, then such payment need not be made on such date but may be made on the
next succeeding day which is a Business Day (except as otherwise provided in Section 401(1)),
with the same force and effect as though made on the date fixed for such
payment, and no interest shall accrue thereon for the period after such date.

 

Section 1006          Successors.  This Trust Agreement shall be binding upon
and shall inure to the benefit of any successor to the Depositor, the Trust or
the Relevant Trustee, including any successor by operation of law.  Except in connection with a consolidation,
merger or sale involving the Depositor that is permitted under Article Eight
of the Indenture and pursuant to which the assignee agrees in writing to
perform the Depositor’s obligations hereunder, the Depositor shall not assign
its obligations hereunder.

 

Section 1007          Headings.  The Article and Section headings
are for convenience only and shall not affect the construction of this Trust
Agreement.

 

Section 1008          Reports, Notices and
Demands.  Any report, notice, demand
or other communication which by any provision of this Trust Agreement is
required or permitted to be given or served to or upon any Securityholder or
the Depositor may be given or served in writing by deposit thereof, first-class
postage prepaid, in the United States mail, hand delivery or facsimile
transmission, in each case, addressed, (a) in the case of a
Preferred Securityholder, to such Preferred Securityholder as such
Securityholder’s name and address may appear on the Securities Register and (b) in
the case of the Common Securityholder or the Depositor, to Principal Financial
Group, Inc., 711 High Street, Des Moines, Iowa 50392, Attention:
[Treasurer], facsimile no.: (515) [ 
]. Any notice to Preferred Securityholders shall also be given to such
owners as have, within two years preceding the giving of such notice, filed
their names and addresses with the Property Trustee for that purpose.  Such notice, demand or other communication to
or upon a Securityholder shall be deemed to have been sufficiently given or
made, for all purposes, upon hand delivery, mailing or transmission.

 

52

 

Any
notice, demand or other communication which by any provision of this Trust
Agreement is required or permitted to be given or served to or upon the Trust,
the Property Trustee or the Administrative Trustees shall be given in writing
addressed (until another address is published by the Trust) as follows: (a) with
respect to the Property Trustee to                      ,
                  ,
                 ,
Attention:                 ;
(b) with respect to the Delaware Trustee, to                     ,
                    
,                  
, Attention:                     ;
and (c) with respect to the Administrative Trustees, to them at the
address above for notices to the Depositor, marked “Attention: Administrative
Trustees of                       .”  Such notice, demand or other communication to
or upon the Trust or the Property Trustee shall be deemed to have been
sufficiently given or made only upon actual receipt of the writing by the Trust
or the Property Trustee.

 

Section 1009          Agreement Not to
Petition.  Each of the Trustees and
the Depositor agree for the benefit of the Securityholders that, until at least
one year and one day after the Trust has been terminated in accordance with Article IX,
they shall not file, or join in the filing of, a petition against the Trust
under any bankruptcy, insolvency, reorganization or other similar law
(including, without limitation, the United States Bankruptcy Code)
(collectively, “Bankruptcy Laws”) or otherwise join in the commencement
of any proceeding against the Trust under any Bankruptcy Law.  In the event the Depositor takes action in
violation of this Section 1009, the Property Trustee agrees, for the
benefit of Securityholders, that at the expense of the Depositor, it shall
(promptly after receipt of written notice of the taking of such action) file an
answer with the bankruptcy court or otherwise properly contest the filing of
such petition by the Depositor against the Trust or the commencement of such
action and raise the defense that the Depositor has agreed in writing not to
take such action and should be stopped and precluded therefrom and such other
defenses, if any, as counsel for the Trustee or the Trust may assert.  The provisions of this Section 1009
shall survive the termination of this Trust Agreement.

 

Section 1010          Trust Indenture Act; Conflict with Trust
Indenture Act.

 

(1)           This Trust Agreement is
subject to the provisions of the Trust Indenture Act that are required to be
part of this Trust Agreement and shall, to the extent applicable, be governed
by such provisions.

 

(2)           The Property Trustee
shall be the only Trustee which is a trustee for the purposes of the Trust
Indenture Act.

 

(3)           If any provision hereof
limits, qualifies or conflicts with another provision hereof which is required
to be included in this Trust Agreement by any of the provisions of the Trust
Indenture Act, such required provision shall control.  If any provision of this Trust Agreement
modifies or excludes any provision of the Trust Indenture Act which may be so
modified or excluded, the latter provision shall be deemed to apply to this
Trust Agreement as so modified or to be excluded, as the case may be.

 

53

 

(4)           The application of the
Trust Indenture Act to this Trust Agreement shall not affect the nature of the
Securities as equity securities representing undivided beneficial interests in
the assets of the Trust.

 

Section 1011          Acceptance of Terms
of Trust Agreement, Guarantee and Indenture.  THE RECEIPT AND ACCEPTANCE OF A TRUST
SECURITY OR ANY INTEREST THEREIN BY OR ON BEHALF OF A SECURITYHOLDER OR ANY
BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR FURTHER MANIFESTATION OF ASSENT,
SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE SECURITYHOLDER AND ALL
OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST SECURITY OF ALL THE TERMS AND
PROVISIONS OF THIS TRUST AGREEMENT AND AGREEMENT TO THE SUBORDINATION
PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE INDENTURE, AND SHALL
CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH SECURITYHOLDER AND SUCH OTHERS THAT
THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE BINDING, OPERATIVE
AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH SECURITYHOLDER AND SUCH OTHERS.

 

 

	
   

  	
  PRINCIPAL FINANCIAL GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [                                                                                                        ],

  
	
   

  	
  as Property Trustee and Delaware Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  as Administrative Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  as Administrative Trustee

  
				

 

54

 

Exhibit A

 

Certificate of
Trust

of

[                        ]

 

This
CERTIFICATE OF TRUST of [                       ]
(the “Trust”), is being duly executed and filed by the undersigned, as
trustee, to form a statutory trust under the Delaware Statutory Trust Act (12
Del. Code Section 3801 et seq.) (the “Act”).

 

10.           Name.  The name of the statutory trust being formed
hereby is “[                       ].”

 

11.           Delaware
Trustee.  The name and business
address of the trustee of the Trust with a principal place of business in the
State of Delaware is                    ,
                       ,
                     
, Attention:                       .

 

12.           Effective
Date.  This Certificate of Trust
shall be effective as of its filing.

 

IN
WITNESS WHEREOF, the undersigned trustee of the Trust, has executed this
Certificate of Trust in accordance with Section 3811(a) of the Act.

 

 

	
   

  	
  [                                            ],

  
	
   

  	
  as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

Exhibit B

 

                
            ,         

 

The
Depository Trust Company 

55
Water Street, 49th Floor 

New
York, New York 10041-0099

 

	
  Attention:

  	
                                            

  	
   

  
	
   

  	
  General Counsel’s Office

  

 

Re:
[                      ]
[Quarterly] Income Preferred Securities

 

Ladies
and Gentlemen:

 

The
purpose of this letter is to set forth certain matters relating to the issuance
and deposit with The Depository Trust Company (“DTC”) of [                                         ]
[               ]%
Cumulative [Quarterly] Income Preferred Securities, Series A (the “Preferred
Securities”), of [                                ],
a Delaware statutory trust (the “Issuer”), formed pursuant to a Trust
Agreement between Principal Financial Group, Inc. (“Principal”) and
               ,
as Trustee.  The payment of distributions
on the Preferred Securities to the extent the Issuer has funds available for
the payment thereof, and payments due upon liquidation of Issuer or redemption
of the Preferred Securities are guaranteed by Principal to the extent set forth
in a Guarantee Agreement, dated                
       ,            ,
by Principal with respect to the Preferred Securities.  Principal and the Issuer propose to sell the
Preferred Securities to certain Underwriters (the “Underwriters”)
pursuant to an Underwriting Agreement, dated                
     , 200  , by and among the Underwriters,
the Issuer and Principal dated                
     ,           ,
and the Underwriters wish to take delivery of the Preferred Securities through
DTC.                   
is acting as transfer agent and registrar with respect to the Preferred
Securities (the “Transfer Agent and Registrar”).

 

To
induce DTC to accept the Preferred Securities as eligible for deposit at DTC,
and to act in accordance with DTC’s rules with respect to the Preferred
Securities, the Issuer, the Transfer Agent and Registrar and DTC agree among
each other as follows:

 

1.                                       Prior
to the closing of the sale of the Preferred Securities to the Underwriters,
which is expected to occur on or about                  
      ,           ,
there shall be deposited with DTC one or more global certificates (individually
and collectively, the “Global Certificate”) registered in the name of
DTC’s Preferred Securities nominee, Cede & Co., representing an
aggregate of                                
Preferred Securities and bearing the following legend:

 

 

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

 

2.                                       The
Amended and Restated Trust Agreement of the Issuer provides for the voting by
holders of the Preferred Securities under certain limited circumstances.  The Issuer shall establish a record date for
such purposes and shall, to the extent possible, give DTC notice of such record
date not less than 15 calendar days in advance of such record date.

 

3.                                       In
the event of a stock split, conversion, recapitalization, reorganization or any
other similar transaction resulting in the cancellation of all or any part of
the Preferred Securities outstanding, the Issuer or the Transfer Agent and
Registrar shall send DTC a notice of such event at least 5 business days prior
to the effective date of such event.

 

4.                                       In
the event of distribution on, or an offering or issuance of rights with respect
to, the Preferred Securities outstanding, the Issuer or the Transfer Agent and
Registrar shall send DTC a notice specifying: (a) the amount of and
conditions, if any, applicable to the payment of any such distribution or any
such offering or issuance of rights; (b) any applicable expiration
or deadline date, or any date by which any action on the part of the holders of
Preferred Securities is required; and (c) the date any required
notice is to be mailed by or on behalf of the Issuer to holders of Preferred Securities
or published by or on behalf of the Issuer (whether by mail or publication, the
“Publication Date”).  Such notice
shall be sent to DTC by a secure means (e.g., legible telecopy, registered or
certified mail, overnight delivery) in a timely manner designed to assure that
such notice is in DTC’s possession no later than the close of business on the
business day before the Publication Date. 
The Issuer or the Transfer Agent and Registrar will forward such notice
either in a separate secure transmission for each CUSIP number or in a secure
transmission of multiple CUSIP numbers (if applicable) that includes a manifest
or list of each CUSIP number submitted in that transmission.  (The party sending such notice shall have a
method to verify subsequently the use of such means and the timeliness of such
notice.) The Publication Date shall be not less than 30 calendar days nor more
than 60 calendar days prior to the payment of any

 

B-2

 

such distribution
or any such offering or issuance of rights with respect to the Preferred
Securities.  After establishing the
amount of payment to be made on the Preferred Securities, the Issuer or the
Transfer Agent and Registrar will notify DTC’s Dividend Department of such
payment 5 business days prior to payment date. 
Notices to DTC’s Dividend Department by telecopy shall be sent to
(212) 855-4555.  Such notices by
mail or by any other means shall be sent to:

 

Manager,
Announcements 

Dividend
Department 

The Depository Trust
Company 

55 Water Street,
25th Floor 

New York, New York
10041

 

The
Issuer or the Transfer Agent and Registrar shall confirm DTC’s receipt of such
telecopy by telephoning the Dividend Department at (212) 855-4550.

 

5.                                       In
the event of a redemption by the Issuer of the Preferred Securities, notice
specifying the terms of the redemption and the Publication Date of such notice
shall be sent by the Issuer or the Transfer Agent and Registrar to DTC not less
than 30 calendar days prior to such event by a secure means in the manner set
forth in paragraph 4. Such redemption notice shall be sent to DTC’s Call
Notification Department at (212) 855-7232, (212) 855-7233 or
(212) 855-7234 and receipt of such notice shall be confirmed by
telephoning (212) 855-7207.  Notice
by mail or by any other means shall be sent to:

 

Call Notification
Department 

The Depository
Trust Company 

55 Water Street,
50th Floor 

New York, New York
10041

 

6.                                       In
the event of any invitation to tender the Preferred Securities, notice
specifying the terms of the tender and the Publication Date of such notice
shall be sent by the Issuer or the Transfer Agent and Registrar to DTC by a
secure means and in a timely manner as described in paragraph 4. Notices to DTC
pursuant to this paragraph and notices of other corporate actions (including
mandatory tenders, exchanges and capital changes), shall be sent, unless
notification to another department is expressly provided for herein, by
telecopy to DTC’s Reorganization Department at (212) 855-5240 or (212) 855-5488
and receipt of such notice shall be confirmed by telephoning
(212) 855-5235 or (212) 855-5489, or by mail or any other means to:

 

B-3

 

Manager,
Reorganization Department 

Reorganization
Window 

The Depository
Trust Company 

55 Water Street,
50th Floor 

New York, New York
10041

 

7.                                      All
notices and payment advices sent to DTC shall contain the CUSIP number or
numbers of the Preferred Securities and the accompanying designation of the
Preferred Securities, which, as of the date of this letter is “[                                ]
            %
Cumulative [Quarterly] Income Preferred Securities.”

 

8.                                      Distribution
payments or other cash payments with respect to the Preferred Securities
evidenced by the Global Certificate shall be received by Cede & Co.,
as nominee of DTC, or its registered assigns in next day funds on each payment
date (or in accordance with existing arrangements between the Issuer or the
Transfer Agent and Registrar and DTC). 
Such payments shall be made payable to the order of Cede & Co.,
and shall be addressed as follows:

 

NDFS Redemption
Department 

The Depository Trust Company 

55 Water Street, 25th Floor 

New York, New York 10041

 

9.                                      DTC
may by prior written notice direct the Issuer and the Transfer Agent and
Registrar to use any other telecopy number or address of DTC as the number or
address to which notices or payments may be sent.

 

10.                                In
the event of a conversion, redemption, or any other similar transaction (e.g.,
tender made and accepted in response to the Issuer’s or the Transfer Agent and
Registrar’s invitation) necessitating a reduction in the aggregate number of
Preferred Securities outstanding evidenced by the Global Certificate, DTC, in
its discretion: (a) may request the Issuer or the Transfer Agent
and Registrar to issue and countersign a new Global Certificate or (b) may
make an appropriate notation on the Global Certificate indicating the date and
amount of such reduction.

 

11.                                DTC
may discontinue its services as a securities depositary with respect to the
Preferred Securities at any time by giving at least 90-days’ prior written
notice to the Issuer and the Transfer Agent and Registrar (at which time DTC
will confirm with the Issuer or the Transfer Agent and Registrar the aggregate
number of Preferred Securities deposited with it) and discharging its
responsibilities with respect thereto under applicable law.

 

B-4

 

Under such
circumstances, the Issuer may determine to make alternative arrangements for
book-entry settlement for the Preferred Securities, make available one or more
separate global certificates evidencing Preferred Securities to any Participant
having Preferred Securities credited to its DTC account, or issue definitive
Preferred Securities to the beneficial holders thereof, and in any such case,
DTC agrees to cooperate fully with the Issuer and the Transfer Agent and
Registrar and to return the Global Certificate, duly endorsed for transfer as
directed by the Issuer or the Transfer Agent and Registrar, together with any
other documents of transfer reasonably requested by the Issuer or the Transfer
Agent and Registrar.

 

12.                                In
the event that the Issuer determines that beneficial owners of Preferred
Securities shall be able to obtain definitive Preferred Securities, the Issuer
or the Transfer Agent and Registrar shall notify DTC of the availability of
certificates.  In such event, the Issuer
or the Transfer Agent and Registrar shall issue, transfer and exchange certificates
in appropriate amounts, as required by DTC and others, and DTC agrees to
cooperate fully with the Issuer and the Transfer Agent and Registrar and to
return the Global Certificate, duly endorsed for transfer as directed by the
Issuer or the Transfer Agent and Registrar, together with any other documents
of transfer reasonably requested by the Issuer or the Transfer Agent and
Registrar.

 

13.                                This
letter may be executed in any number of counterparts, each of which when so
executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.

 

Nothing
herein shall be deemed to require the Transfer Agent and Registrar to advance
funds on behalf of [                      ].

 

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [                            
  ]

  
	
   

  	
  (As Issuer)

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  [Name of Trustee]

  
	
   

  	
   

  	
  Administrative Trustee

  

 

B-5

 

	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
  (As Transfer Agent and Registrar)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  RECEIVED AND ACCEPTED:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  THE DEPOSITORY TRUST COMPANY

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Officer

  	
   

  	
   

  

 

B-6

 

Exhibit C

 

THIS CERTIFICATE
IS NOT TRANSFERABLE EXCEPT AS PROVIDED IN THE

TRUST AGREEMENT (AS DEFINED BELOW)

 

	
  Certificate
  Number

  	
   

  	
  Number of Common Securities

  
	
  C–

  	
   

  	
   

  

 

Certificate
Evidencing Common Securities

of

[                            ]

% Common Securities 

 

(liquidation
amount $25 per Common Security)

 

[                            ],
a statutory trust formed under the laws of the State of Delaware (the “Trust”),
hereby certifies that Principal Financial Group, Inc.  (the “Holder”) is the registered owner
of                         
(        ) common securities of the
Trust representing undivided beneficial interests in the assets of the Trust
and designated the         % Common
Securities (liquidation amount $25 per Common Security) (the “Common Securities”).  In accordance with Section 510 of the
Trust Agreement (as defined below) the Common Securities are not transferable
and, to the fullest extent permitted by law, any attempted transfer hereof
shall be void.  The designations, rights,
privileges, restrictions, preferences and other terms and provisions of the
Common Securities are set forth in, and this certificate and the Common
Securities represented hereby are issued and shall in all respects be subject
to the terms and provisions of, the Amended and Restated Trust Agreement of the
Trust, dated as of                     ,
200  , as the same may be amended from time to time (the “Trust
Agreement”) including the designation of the terms of the Common Securities
as set forth therein.  The Trust will furnish
a copy of the Trust Agreement to the Holder without charge upon written request
to the Trust at its principal place of business or registered office.

 

Upon
receipt of this certificate, the Holder is bound by the Trust Agreement and is
entitled to the benefits thereunder.

 

 

IN
WITNESS WHEREOF, one of the Administrative Trustees of the Trust has executed
this certificate this          day of                                 .

 

	
   

  	
   

  	
  [                            ]

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Administrative Trustee

  

 

C-2

 

Exhibit D

 

Agreement as to
Expenses and Liabilities

 

AGREEMENT,
dated as of                     ,
200   between Principal Financial Group, Inc., a Delaware
corporation (“Principal”), and [                            ],
a Delaware statutory trust (the “Trust”).

 

WHEREAS,
the Trust intends to issue its Common Securities (the “Common Securities”)
to and receive Debentures from Principal and to issue and sell       %
                          
(the “Preferred Securities”) with such powers, preferences and special
rights and restrictions as are set forth in the Amended and Restated Trust
Agreement of the Trust dated as of                     ,
20     as the same may be amended from time to time (the “Trust
Agreement”);

 

WHEREAS,
Principal will directly or indirectly own all of the Common Securities of Trust
and will issue the Debentures;

 

NOW,
THEREFORE, in consideration of the purchase by each holder of the Preferred
Securities, which purchase Principal hereby agrees shall benefit Principal and
which purchase Principal acknowledges will be made in reliance upon the
execution and delivery of this Agreement, Principal and Trust hereby agree as
follows:

 

ARTICLE I

 

Section 1.1             Guarantee
by Principal.  Subject to the terms
and conditions hereof, Principal hereby irrevocably and unconditionally
guarantees to each person or entity to whom the Trust is now or hereafter
becomes indebted or liable (the “Beneficiaries”) the full payment, when
and as due, of any and all Obligations (as hereinafter defined) to such
Beneficiaries.  As used herein, “Obligations”
means any costs, expenses or liabilities of the Trust, other than obligations
of the Trust to pay to holders of any Preferred Securities or other similar
interests in the Trust the amounts due such holders pursuant to the terms of
the Preferred Securities or such other similar interests, as the case may
be.  This Agreement is intended to be for
the benefit of, and to be enforceable by, all such Beneficiaries, whether or
not such Beneficiaries have received notice hereof.

 

Section 1.2             Term
of Agreement.  This Agreement shall
terminate and be of no further force and effect upon the later of (a) the
date on which full payment has been made of all amounts payable to all holders
of all the Preferred Securities (whether upon redemption, liquidation, exchange
or otherwise) and (b) the date on which there are no Beneficiaries
remaining; provided, however, that this Agreement shall continue to be
effective or shall be reinstated, as the case may be, if at any time any holder
of Preferred Securities or any Beneficiary must restore payment of any sums
paid under the Preferred Securities, under any Obligation, under the Guarantee
Agreement dated the date hereof 

 

 

by Principal and                     
as guarantee trustee or under this Agreement for any reason whatsoever.  This Agreement is continuing, irrevocable,
unconditional and absolute.

 

Section 1.3             Waiver
of Notice.  Principal hereby waives
notice of acceptance of this Trust Agreement and of any Obligation to which it
applies or may apply, and Principal hereby waives presentment, demand for
payment, protest, notice of nonpayment, notice of dishonor, notice of
redemption and all other notices and demands.

 

Section 1.4             No
Impairment.  The obligations,
covenants, agreements and duties of Principal under this Trust Agreement shall
in no way be affected or impaired by reason of the happening from time to time
of any of the following:

 

(a)           the extension of time for the payment
by the Trust of all or any portion of the Obligations or for the performance of
any other obligation under, arising out of, or in connection with, the
obligations;

 

(b)           any failure, omission, delay or lack
of diligence on the part of the Beneficiaries to enforce, assert or exercise
any right, privilege, power or remedy conferred on the Beneficiaries with
respect to the Obligations or any action on the part of the Trust granting
indulgence or extension of any kind; or

 

(c)           the voluntary or involuntary
liquidation, dissolution, sale of any collateral, receivership, insolvency,
bankruptcy, assignment for the benefit of creditors, reorganization,
arrangement, composition or readjustment of debt, or other similar proceedings
affecting the Trust or any of the assets of the Trust.

 

There
shall be no obligation of the Beneficiaries to give notice to, or obtain the
consent of, Principal with respect to the happening of any of the foregoing.

 

Section 1.5             Enforcement.  A Beneficiary may enforce this Agreement directly
against Principal and Principal waives any right or remedy to require that any
action be brought against the Trust or any other person or entity before
proceeding against Principal.

 

ARTICLE II

 

Section 2.1             Binding
Effect.  All guarantees and agreements
contained in this Trust Agreement shall bind the successors, assigns,
receivers, trustees and representatives of Principal and shall inure to the
benefit of the Beneficiaries.

 

Section 2.2             Amendment.  So long as there remains any Beneficiary or
any Preferred Securities of any series are outstanding, this Agreement shall
not be modified or amended in any manner adverse to such Beneficiary or to the
holders of the Preferred Securities.

 

D-2

 

Section 2.3  Notices.  Any notice, request or other communication
required or permitted to be given hereunder shall be given in writing by
delivering the same against receipt therefor by facsimile transmission
(confirmed by mail), telex or by registered or certified mail, addressed as
follows (and if so given, shall be deemed given when mailed or upon receipt of
an answer-back, if sent by telex):

 

[                            ]

c/o                     

                              

                              

Facsimile No.:                       

Attention:

 

Principal Financial Group, Inc.

711 High Street 

Des Moines, Iowa 50392 

Facsimile No.:
(515) [                   ]

Attention: [Treasurer]

 

Section 2.4  This Agreement
shall be governed by and construed and interpreted in accordance with the laws
of the State of New York.

 

D-3

 

THIS
AGREEMENT is executed as of the day and year first above written.

 

 

	
   

  	
   

  	
  PRINCIPAL FINANCIAL
  GROUP, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  [                            ]

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Administrative Trustee

  

 

D-4

 

Exhibit E

 

IF THE
PREFERRED SECURITY IS TO BE A GLOBAL CERTIFICATE INSERT –  This Preferred Security is a Global
Certificate within the meaning of the Trust Agreement hereinafter referred to
and is registered in the name of The Depository Trust Company (the “Depository”)
or a nominee of the Depository.  This
Preferred Security is exchangeable for Preferred Securities registered in the
name of a person other than the Depository or its nominee only in the limited
circumstances described in the Trust Agreement and no transfer of this
Preferred Security (other than a transfer of this Preferred Security as a whole
by the Depository to a nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository) may be
registered except in limited circumstances.

 

Unless
this Preferred Security is presented by an authorized representative of The
Depository Trust Company (55 Water Street, New York) to [                            ]
or its agent for registration of transfer, exchange or payment, and any
Preferred Security issued is registered in the name of Cede & Co. or
such other name as requested by an authorized representative of The Depository
Trust Company and any payment hereon is made to Cede & Co., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an
interest herein.

 

	
  Certificate Number

  	
   

  	
  Number of Preferred
  Securities

  
	
   

  	
   

  	
   

  
	
  P–

  	
   

  	
   

  

 

CUSIP
NO.

 

Certificate
Evidencing Preferred Securities 

of 

[                            ]

     %, 

Series       
  (liquidation amount $25 per Preferred
Security)

 

 [                            ],
a statutory trust formed under the laws of the State of Delaware (the “Trust”),
hereby certifies that                                     
(the “Holder”) is the registered owner of                           
(        ) preferred securities of the
Trust representing an undivided beneficial interest in the assets of the Trust
and designated the [                            ]
    %                                     ,
Series A        (liquidation amount $25 per
Preferred Security) (the “Preferred Securities”).  The Preferred Securities are transferable on
the books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this certificate duly endorsed and in proper form for
transfer 

 

 

as provided in Section 504 of the Trust Agreement (as defined
below).  The designations, rights,
privileges, restrictions, preferences and other terms and provisions of the
Preferred Securities are set forth in, and this certificate and the Preferred
Securities represented hereby are issued and shall in all respects be subject
to the terms and provisions of, the Amended and Restated Trust Agreement of the
Trust dated as of                       ,
200  , as the same may be amended from time to time (the “Trust
Agreement”) including the designation of the terms of Preferred Securities
as set forth therein.  The Holder is
entitled to the benefits of the Guarantee Agreement entered into by Principal
Financial Group, Inc., a Delaware corporation, and                     ,
as guarantee trustee, dated as of                     ,
200  , as the same may be amended from time to time (the “Guarantee”),
to the extent provided therein.  The
Trust will furnish a copy of the Trust Agreement and the Guarantee to the
Holder without charge upon written request to the Trust at its principal place
of business or registered office.

 

Upon
receipt of this certificate, the Holder is bound by the Trust Agreement and is
entitled to the benefits thereunder.

 

IN
WITNESS WHEREOF, one of the Administrative Trustees of the Trust has executed
this certificate this          day of                       ,
        .

 

	
   

  	
   

  	
  [                            ]

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Administrative Trustee

  

 

E-2

 

Assignment

 

FOR
VALUE RECEIVED, the undersigned assigns and transfers this Preferred Security
to:

 

(Insert assignee’s social security or tax identification number)

 

(Insert
address and zip code of assignee)

 

and
irrevocably appoints

 

agent
to transfer this Preferred Security Certificate on the books of the Trust.  The agent may substitute another to act for
him or her.

 

	
  Date:

  	
   

  	
   

  
	
  Signature:

  	
   

  	
   

  
	
  (Sign
  exactly as your name appears on the other side of this Preferred Security Certificate)

  
					

 

E-3

 

ANNEX C

 

GUARANTEE AGREEMENT

 

among

 

Principal
Financial Group, Inc.,

 

as guarantor

 

and

 

[                            ],

 

as trustee

 

dated as of

 

[                            ]

 

 

TABLE
OF CONTENTS

 

	
  Article 1

  
	
  Definitions

  
	
   

  
	
  Section 101. Definitions

  	
  1

  
	
   

  	
   

  
	
  Article 2

  
	
  Trust
  Indenture Act

  
	
   

  
	
  Section 201. Trust Indenture
  Act; Application

  	
  5

  
	
  Section 202. List of Holders

  	
  5

  
	
  Section 203. Reports by the
  Guarantee Trustee

  	
  5

  
	
  Section 204. Periodic Reports
  to Guarantee Trustee

  	
  5

  
	
  Section 205. Evidence of
  Compliance with Conditions Precedent

  	
  6

  
	
  Section 206. Events of
  Default; Waiver

  	
  6

  
	
  Section 207. Event of Default;
  Notice

  	
  6

  
	
  Section 208. Conflicting
  Interests

  	
  6

  
	
   

  	
   

  
	
  Article 3

  
	
  Powers,
  Duties and Rights of the Guarantee Trustee

  
	
   

  
	
  Section 301. Powers and Duties
  of the Guarantee Trustee

  	
  6

  
	
  Section 302. Certain Rights of
  Guarantee Trustee

  	
  8

  
	
  Section 303. Indemnity

  	
  10

  
	
   

  	
   

  
	
  Article 4

  
	
  Guarantee
  Trustee

  
	
   

  
	
  Section 401. Guarantee
  Trustee; Eligibility

  	
  10

  
	
  Section 402. Appointment,
  Removal and Resignation of the Guarantee Trustee

  	
  11

  
	
   

  	
   

  
	
  Article 5

  
	
  Guarantee

  
	
   

  
	
  Section 501. Guarantee

  	
  12

  
	
  Section 502. Waiver of Notice
  and Demand

  	
  12

  
	
  Section 503. Obligations Not
  Affected

  	
  12

  
	
  Section 504. Rights of Holders

  	
  13

  
	
  Section 505. Guarantee of
  Payment

  	
  13

  
	
  Section 506.
  Subrogation

  	
  13

  
	
  Section 507.
  Independent Obligations

  	
  14

  

 

ii

 

	
  Article 6

  
	
  Covenants and Subordination

  
	
   

  
	
  Section 601.
  Subordination

  	
  14

  
	
  Section 602.
  Pari Passu Guarantees

  	
  14

  
	
   

  	
   

  
	
  Article 7

  
	
  Termination

  
	
   

  
	
  Section 701. Termination

  	
  14

  
	
   

  	
   

  
	
  Article 8

  
	
  Miscellaneous

  
	
   

  
	
  Section 801. Successors and
  Assigns

  	
  14

  
	
  Section 802. Amendments

  	
  15

  
	
  Section 803. Notices

  	
  15

  
	
  Section 804. Benefit

  	
  16

  
	
  Section 805. Interpretation

  	
  16

  
	
  Section 806. Governing Law

  	
  17

  

 

iii

 

CROSS-REFERENCE TABLE

 

	
  TRUST INDENTURE ACT SECTION

  	
   

  	
  GUARANTEE SECTION

  
	
   

  	
   

  	
   

  
	
  Section 310(a)

  	
   

  	
  401(1)

  
	
  (b)

  	
   

  	
  401(3), 208

  
	
  (c)

  	
   

  	
  Not Applicable

  
	
   

  	
   

  	
   

  
	
  Section 311(a)

  	
   

  	
  202(2)

  
	
  (b)

  	
   

  	
  202(2)

  
	
  (c)

  	
   

  	
  Not Applicable

  
	
   

  	
   

  	
   

  
	
  Section 312(a)

  	
   

  	
  202(1)

  
	
  (b)

  	
   

  	
  202(2)

  
	
   

  	
   

  	
   

  
	
  Section 313

  	
   

  	
  203

  
	
   

  	
   

  	
   

  
	
  Section 314(a)

  	
   

  	
  204

  
	
  (b)

  	
   

  	
   

  
	
  (c)

  	
   

  	
  205

  
	
  (d)

  	
   

  	
  Not Applicable

  
	
  (e)

  	
   

  	
  101, 205, 302

  
	
  (f)

  	
   

  	
  201, 302

  
	
   

  	
   

  	
   

  
	
  Section 315(a)

  	
   

  	
  301(4)

  
	
  (b)

  	
   

  	
  207

  
	
  (c)

  	
   

  	
  301

  
	
  (d)

  	
   

  	
  301(4)

  
	
   

  	
   

  	
   

  
	
  Section 316(a)

  	
   

  	
  101, 206, 504

  
	
  (b)

  	
   

  	
  503

  
	
  (c)

  	
   

  	
  802

  
	
   

  	
   

  	
   

  
	
  Section 317(a)

  	
   

  	
  Not Applicable

  
	
  (b)

  	
   

  	
  Not Applicable

  
	
   

  	
   

  	
   

  
	
  Section 318(a)

  	
   

  	
  201(2)

  
	
  (b)

  	
   

  	
  201

  
	
  (c)

  	
   

  	
  201(1)

  

 

NOTE:  This cross-reference table
and tie shall not, for any purpose, be deemed to be a part of the Guarantee
Agreement.

 

i

 

GUARANTEE
AGREEMENT

 

This GUARANTEE
AGREEMENT, dated as of                           ,
200  , is executed and delivered by Principal Financial Group, Inc.,
a Delaware corporation (the “Guarantor”), and [                  ],
a [                                ]
organized under the laws of the State of Delaware, as trustee (the “Guarantee
Trustee”), for the benefit of the Holders (as defined herein) from time to
time of the Preferred Securities (as defined herein) of [                            ],
a Delaware statutory trust (the “Issuer”).

 

WHEREAS, pursuant
to an Amended and Restated Trust Agreement (the “Trust Agreement”),
dated as of                       ,
200  , among the Trustees named therein, the Guarantor, as Depositor,
and the Holders from time to time of undivided beneficial interests in the
assets of the Issuer, the Issuer is issuing                                     
of its       % Preferred Securities, Series A
(liquidation preference $25 per preferred security) (the “Preferred
Securities”) representing preferred undivided beneficial interests in the
assets of the Issuer and having the terms set forth in the Trust Agreement;

 

WHEREAS, the
Preferred Securities will be issued by the Issuer and the proceeds thereof,
together with the proceeds from the issuance of the Issuer’s Common Securities
(as defined below), will be used to purchase the Debentures (as defined in the
Trust Agreement) of the Guarantor which will be deposited with [                        ],
as Property Trustee under the Trust Agreement, as trust assets; and

 

WHEREAS, as
incentive for the Holders to purchase Preferred Securities, the Guarantor
desires irrevocably and unconditionally to agree, to the extent set forth
herein, to pay to the Holders of the Preferred Securities the Guarantee
Payments (as defined herein) and to make certain other payments on the terms
and conditions set forth herein.

 

NOW, THEREFORE, in
consideration of the purchase by each Holder of Preferred Securities, which
purchase the Guarantor hereby agrees shall benefit the Guarantor, the Guarantor
executes and delivers this Guarantee Agreement for the benefit of the Holders
from time to time of the Preferred Securities.

 

ARTICLE ONE

 

Definitions

 

Section 101            Definitions.  As used in this Guarantee Agreement, the
terms set forth below shall, unless the context otherwise requires, have the
following meanings.  Capitalized or
otherwise defined terms used but not otherwise defined herein shall have the
meanings assigned to such terms in the Trust Agreement as in effect on the date
hereof.

 

 

“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, provided, however, that an Affiliate of the Guarantor
shall not be deemed to include the Issuer. 
For the purposes of this definition, “control” when used with
respect to any specified Person means the power to direct 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.

 

“Common
Securities” means the securities representing common beneficial interests
in the assets of the Issuer.

 

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

 

“Event of
Default” means a default by the Guarantor on any of its payment or other obligations
under this Guarantee Agreement; provided, however, that, except with respect to
a default in payment of any Guarantee Payments, the Guarantor shall have
received notice of default and shall not have cured such default within 60 days
after receipt of such notice.

 

“Expenses”
has the meaning specified in Section 303.

 

“Guarantee
Payments” means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid
or made by or on behalf of the Issuer: (i) any accrued and unpaid
Distributions (as defined in the Trust Agreement) required to be paid on the
Preferred Securities, to the extent the Issuer shall have funds on hand
available therefor, (ii) the redemption price, including all
accrued and unpaid Distributions to the date of redemption (the “Redemption
Price”), with respect to the Preferred Securities called for redemption by
the Issuer to the extent the Issuer shall have funds on hand available
therefor, and (iii) upon a voluntary or involuntary termination,
winding-up or liquidation of the Issuer, unless Debentures are distributed to
the Holders, the lesser of (a) the aggregate of the liquidation
preference of $25 per 

 

2

 

Preferred
Security plus accrued and unpaid Distributions on the Preferred Securities to
the date of payment to the extent the Issuer shall have funds on hand available
to make such payment and (b) the amount of assets of the Issuer remaining
available for distribution to Holders in liquidation of the Issuer (in either
case, the “Liquidation Distribution”).

 

“Guarantee
Trustee” means [   ] (not in its individual capacity but
solely in its trustee capacity), until a Successor Guarantee Trustee has been
appointed and has accepted such appointment pursuant to the terms of this
Guarantee Agreement and thereafter means each such Successor Guarantee Trustee.

 

“Holder”
means any holder, as registered on the books and records of the Issuer, of any
Preferred Securities; provided, however, that in determining whether the
holders of the requisite percentage of Preferred Securities have given any
request, notice, consent or waiver hereunder, “Holder” shall not include
the Guarantor, the Guarantee Trustee or any Affiliate of the Guarantor or the
Guarantee Trustee.

 

“Indenture”
means the Junior Subordinated Indenture dated as of                   ,
200  , as supplemented and amended between the Guarantor and [                              ],
as trustee.

 

“List of
Holders” has the meaning specified in Section 202(1).

 

“Majority in
liquidation preference of the Securities” means, except as provided by the
Trust Indenture Act, a vote by the Holder(s), voting separately as a class, of
more than 50% of the liquidation preference of all then outstanding Preferred
Securities issued by the Issuer.

 

“Officers’
Certificate” means, with respect to any Person, a certificate signed by the
Chairman, President, Chief Executive Officer or a Vice President, and by the
Treasurer, an Associate Treasurer, an Assistant Treasurer, the Controller, the
Secretary or an Assistant Secretary of such Person, and delivered to the
Guarantee Trustee.  Any Officers’
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Guarantee Agreement shall include:

 

(1)           a statement that each officer signing
the Officers’ Certificate has read the covenant or condition and the
definitions relating thereto;

 

(2)           a brief statement of the nature and
scope of the examination or investigation undertaken by each officer in
rendering the Officers’ Certificate;

 

(3)           a statement that each such officer
has made such examination or investigation as, in such officer’s opinion, is
necessary to enable such officer to 

 

3

 

express an informed
opinion as to whether or not such covenant or condition has been complied with;
and

 

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

 

“Person”
means a legal person, including any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated association, or government or any agency or
political subdivision thereof, or any other entity of whatever nature.

 

“Responsible
Officer” means, with respect to the Guarantee Trustee, any officer within
the Corporate Trust Administration department of the Guarantee Trustee with
direct responsibility for the administration of this Guarantee Agreement,
including any vice-president, any assistant vice president, any assistant
secretary, the treasurer, any assistant treasurer, any trust officer or other
officer of the Corporate Trust Office of the Guarantee Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of that officer’s
knowledge of and familiarity with the particular subject.

 

“Senior Debt”
means the principal of (and premium, if any) and interest, if any (including
interest accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Guarantor whether or not such claim for
post-petition interest is allowed in such proceeding), on Debt, whether
incurred on or prior to the date of this Guarantee or thereafter incurred,
unless, in the instrument creating or evidencing the same or pursuant to which
the same is outstanding, it is provided that such obligations are not superior
in right of payment to the Guarantee or to other Debt which is pari passu with,
or subordinated to, the Guarantee; provided, however, that Senior Debt shall
not be deemed to include (a) any Debt of the Guarantor which when
incurred and without respect to any election under Section 11.11(b) of
the Bankruptcy Reform Act of 1978, was without recourse to the Company, (b) any
Debt of the Guarantor to any of its Subsidiaries, (c) Debt to any
employee of the Guarantor, (d) any liability for taxes, (e) Debt
or other monetary obligations to trade creditors created or assumed by the
Guarantor or any of its Subsidiaries in the ordinary course of business in
connection with the obtaining of goods, materials or services and (f) Debt
issued under the Indenture and (g) the Guarantee.

 

“Successor
Guarantee Trustee” means a successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section 401.

 

“Trust
Indenture Act” means the Trust Indenture Act of 1939, as amended.

 

4

 

ARTICLE TWO

 

Trust Indenture Act

 

Section 201            Trust
Indenture Act; Application.

 

(1)           This
Guarantee Agreement is subject to the provisions of the Trust Indenture Act
that are required to be part of this Guarantee Agreement and shall, to the
extent applicable, be governed by such provisions.

 

(2)           If
and to the extent that any provision of this Guarantee Agreement limits,
qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.

 

Section 202            List
of Holders.

 

(1)           The
Guarantor shall furnish or cause to be furnished to the Guarantee Trustee (a) semiannually,
on or before February 15 and August 15 of each year, a list, in such
form as the Guarantee Trustee may reasonably require, of the names and
addresses of the Holders (“List of Holders”) as of a date not more than
15 days prior to the delivery thereof, and (b) at such other times
as the Guarantee Trustee may request in writing, within 30 days after the
receipt by the Guarantor of any such request, a List of Holders as of a date
not more than 15 days prior to the time such list is furnished, in each case to
the extent such information is in the possession or control of the Guarantor
and is not identical to a previously supplied list of Holders or has not
otherwise been received by the Guarantee Trustee in its capacity as such.  The Guarantee Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.

 

(2)           The
Guarantee Trustee shall comply with its obligations under Section 3.11(a),
Section 3.11(b) and Section 3.12(b) of the Trust Indenture
Act.

 

Section 203            Reports
by the Guarantee Trustee.  Within 60
days after                             
of each year, the Guarantee Trustee shall provide to the Holders such reports
as are required by Section 3.13 of the Trust Indenture Act, if any, in the
form and in the manner provided by Section 3.13 of the Trust Indenture Act.  The Guarantee Trustee shall also comply with
the requirements of Section 3.13(d) of the Trust Indenture Act.

 

Section 204            Periodic
Reports to Guarantee Trustee.  The
Guarantor shall provide to the Guarantee Trustee, the Securities and Exchange
Commission and the Holders such documents, reports and information, if any, as
required by Section 3.14 of the Trust Indenture Act and the compliance
certificate required by Section 3.14 of the Trust Indenture Act in the
form, in the manner and at the times required by Section 3.14 of the Trust
Indenture Act.

 

5

 

Section 205            Evidence of
Compliance with Conditions Precedent. 
The Guarantor shall provide to the Guarantee Trustee such evidence of
compliance with such conditions precedent, if any, provided for in this
Guarantee Agreement that relate to any of the matters set forth in
Section 3.14(c) of the Trust Indenture Act.  Any certificate or opinion required to be
given by an officer pursuant to Section 3.14(c)(1) may be given in
the form of an Officers’ Certificate.

 

Section 206            Events of Default;
Waiver.  The Holders of a Majority in
liquidation preference of the Preferred Securities may, by vote, on behalf of
the Holders, waive any past Event of Default and its consequences.  Upon such waiver, any such Event of Default
shall cease to exist, and any Event of Default arising therefrom shall be
deemed to have been cured, for every purpose of this Guarantee Agreement, but
no such waiver shall extend to any subsequent or other default or Event of
Default or impair any right consequent therefrom.

 

Section 207            Events of Default;
Notice.

 

(1)           The Guarantee Trustee
shall, within 90 days after the occurrence of an Event of Default, transmit by
mail, first class postage prepaid, to the Holders, notices of all Events of
Default actually known to a Responsible Officer of the Guarantee Trustee,
unless such defaults have been cured before the giving of such notice,
provided, that, except in the case of a default in the payment of a Guarantee
Payment, the Guarantee Trustee shall be protected in withholding such notice if
and so long as the Board of Directors, the executive committee or a trust
committee of directors and/or Responsible Officers of the Guarantee Trustee in
good faith determines that the withholding of such notice is in the interests
of the Holders.

 

(2)           The Guarantee Trustee
shall not be deemed to have knowledge of any Event of Default unless a
Responsible Officer of the Guarantee Trustee shall have received written notice
of such Event of Default.

 

Section 208            Conflicting
Interests.  The Trust Agreement shall
be deemed to be specifically described in this Guarantee Agreement for the
purposes of clause (i) of the first proviso contained in
Section 3.10(b) of the Trust Indenture Act.

 

ARTICLE THREE

 

Powers,
Duties and Rights of the Guarantee Trustee

 

Section 301            Powers and Duties
of the Guarantee Trustee.

 

(1)           This Guarantee
Agreement shall be held by the Guarantee Trustee for the benefit of the
Holders, and the Guarantee Trustee shall not transfer this Guarantee Agreement
to any Person except a Holder exercising his or her rights pursuant to 

 

6

 

Section 504(iv) or to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Successor Guarantee Trustee.  The right,
title and interest of the Guarantee Trustee shall automatically vest in any
Successor Guarantee Trustee, upon acceptance by such Successor Guarantee
Trustee of its appointment hereunder, and such vesting and cessation of title
shall be effective whether or not conveyancing documents have been executed and
delivered pursuant to the appointment of such Successor Guarantee Trustee.

 

(2)           If an Event of Default
has occurred and is continuing, the Guarantee Trustee shall, promptly upon
receipt of written notice of such Event of Default, enforce this Guarantee
Agreement for the benefit of the Holders.

 

(3)           The Guarantee Trustee,
before the occurrence of any Event of Default and after the curing of all
Events of Default that may have occurred, shall undertake to perform only such
duties as are specifically set forth in this Guarantee Agreement, and no
implied duties or covenants shall be read into this Guarantee Agreement against
the Guarantee Trustee.  In case an Event
of Default has occurred (that has not been cured or waived pursuant to
Section 206), the Guarantee Trustee shall exercise such of the rights and
powers vested in it by this Guarantee Agreement, and use the same degree of
care and skill in its exercise thereof, as a prudent person would exercise or
use under the circumstances in the conduct of his or her own affairs.

 

(4)           No provision of this
Guarantee Agreement shall be construed to relieve the Guarantee 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 any Event of Default and after the curing or waiving of all such Events of
Default that may have occurred:

 

(A)          the duties and
obligations of the Guarantee Trustee shall be determined solely by the express
provisions of this Guarantee Agreement, and the Guarantee Trustee shall not be
liable except for the performance of such duties and obligations as are
specifically set forth in this Guarantee Agreement; and

 

(B)           in the absence of bad
faith on the part of the Guarantee Trustee, the Guarantee 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
Guarantee Trustee and conforming to the requirements of this Guarantee
Agreement; but in the case of any such certificates or opinions that by any
provision hereof or of the Trust Indenture Act are specifically required to be
furnished to the Guarantee Trustee, the Guarantee Trustee shall be under a duty
to examine the same

 

7

 

to determine whether or not they conform on their face
to the requirements of this Guarantee Agreement;

 

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

 

(c)           the Guarantee Trustee
shall not be liable with respect to any action taken or omitted to be taken by
it in good faith in accordance with the direction of the Holders of not less
than a Majority in liquidation preference of the Preferred Securities relating
to the time, method and place of conducting any proceeding for any remedy
available to the Guarantee Trustee, or exercising any trust or power conferred
upon the Guarantee Trustee under this Guarantee Agreement; and

 

(d)           no provision of this
Guarantee Agreement shall require the Guarantee 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 the
Guarantee Trustee shall have reasonable grounds for believing that the repayment
of such funds or liability is not reasonably assured to it under the terms of
this Guarantee Agreement or adequate indemnity against such risk or liability
is not reasonably assured to it.

 

Section 302            Certain Rights of
Guarantee Trustee.

 

(1)           Subject to the
provisions of Section 301:

 

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

 

(b)           Any direction or act of
the Guarantor contemplated by this Guarantee Agreement shall be sufficiently
evidenced by an Officers’ Certificate unless otherwise prescribed herein.

 

(c)           Whenever, in the
administration of this Guarantee Agreement, the Guarantee Trustee shall deem it
desirable that a matter be proved or established before taking, suffering or
omitting to take any action hereunder, the Guarantee Trustee (unless other
evidence is herein specifically prescribed) may, in the absence of bad faith on
its part, request and rely upon an Officers’ Certificate 

 

8

 

which, upon receipt of such request from the Guarantee
Trustee, shall be promptly delivered by the Guarantor.

 

(d)           The Guarantee Trustee
may consult with legal counsel, and the written advice or opinion of such legal
counsel with respect to legal matters shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted to be taken
by it hereunder in good faith and in accordance with such advice or opinion.  Such legal counsel may be legal counsel to
the Guarantor or any of its Affiliates and may be one of its employees.  The Guarantee Trustee shall have the right at
any time to seek instructions concerning the administration of this Guarantee
Agreement from any court of competent jurisdiction.

 

(e)           The Guarantee Trustee
shall be under no obligation to exercise any of the rights or powers vested in
it by this Guarantee Agreement at the request or direction of any Holder,
unless such Holder shall have provided to the Guarantee Trustee such adequate
security and indemnity as would satisfy a reasonable person in the position of
the Guarantee Trustee, against the costs, expenses (including attorneys’ fees
and expenses) and liabilities that might be incurred by it in complying with
such request or direction, including such reasonable advances as may be
requested by the Guarantee Trustee; provided that, nothing contained in this Section 302(1)(e) shall
be taken to relieve the Guarantee Trustee, upon the occurrence of an Event of
Default, of its obligation to exercise the rights and powers vested in it by
this Guarantee Agreement.

 

(f)            The Guarantee Trustee
shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Guarantee Trustee, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit.

 

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

 

(h)           Whenever in the
administration of this Guarantee Agreement the Guarantee Trustee shall deem it
desirable to receive instructions with respect to enforcing any remedy or right
or taking any other action hereunder, the Guarantee Trustee (A) may
request instructions from the Holders, (B) may refrain from
enforcing such remedy or right or taking such other action until such instructions

 

9

 

are received, and (C) shall be protected
in acting in accordance with such instructions.

 

(2)           No provision of this
Guarantee Agreement shall be deemed to impose any duty or obligation on the
Guarantee Trustee to perform any act or acts or exercise any right, power, duty
or obligation conferred or imposed on it in any jurisdiction in which it shall
be illegal, or in which the Guarantee Trustee shall be unqualified or
incompetent in accordance with applicable law, to perform any such act or acts
or to exercise any such right, power, duty or obligation.  No permissive power or authority available to
the Guarantee Trustee shall be construed to be a duty to act in accordance with
such power and authority.

 

Section 303            Indemnity.  The Guarantor agrees to indemnify the
Guarantee Trustee (including in its individual capacity) and its officers,
directors and employees for, and to hold each harmless against, any loss,
liability or expense incurred without negligence or bad faith on the part of
the Guarantee Trustee, arising out of or in connection with the acceptance or
administration of this Guarantee Agreement, including the costs and expenses of
defending itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder (collectively, “Expenses”).  The Guarantee Trustee will not claim or exact
any lien or charge on any Guarantee Payments as a result of any amount due to
it under this Guarantee Agreement.  To
the fullest extent permitted by law, the Expenses (including reasonable
attorneys’ fees and expenses) incurred by the Guarantee Trustee referred to
above shall be paid by the Guarantor in advance upon receipt of an undertaking
by or on behalf of the Guarantee Trustee to repay such amount if it shall
ultimately be determined that the Guarantee Trustee is not entitled to be
indemnified by the Guarantor as authorized in this Section 303.  The obligations of the Guarantor under this Section 303
shall survive termination of this Guarantee Agreement and the removal or
resignation of any Guarantee Trustee.

 

ARTICLE FOUR

 

Guarantee
Trustee

 

Section 401            Guarantee Trustee;
Eligibility.

 

(1)           There shall at all
times be a Guarantee Trustee which shall:

 

(a)           not be an Affiliate of
the Guarantor; and

 

(b)           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 U.S. dollars ($50,000,000), and
shall be a corporation meeting the requirements of Section 3.10(c) of
the Trust Indenture Act.  If such
corporation publishes reports of condition at least annually, pursuant to law
or to the requirements of the 

 

10

 

supervising or examining authority, then, for the
purposes of this Section and to the extent permitted by the Trust
Indenture Act, the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published.

 

(2)           If at any time the
Guarantee Trustee shall cease to be eligible to so act under Section 401(1),
the Guarantee Trustee shall immediately resign in the manner and with the
effect set out in Section 402(3).

 

(3)           If the Guarantee Trustee
has or shall acquire any “conflicting interest” within the meaning of Section 3.10(b) of
the Trust Indenture Act, the Guarantee Trustee and Guarantor shall in all
respects comply with the provisions of Section 3.10(b) of the Trust
Indenture Act.

 

Section 402            Appointment,
Removal and Resignation of the Guarantee Trustee.

 

(1)           Subject to Section 402(2),
the Guarantee Trustee may be appointed or removed without cause at any time by
the Guarantor.

 

(2)           The Guarantee Trustee
shall not be removed until a Successor Guarantee Trustee has been appointed and
has accepted such appointment by written instrument executed by such Successor
Guarantee Trustee and delivered to the Guarantor.

 

(3)           The Guarantee Trustee
appointed hereunder shall hold office until a Successor Guarantee Trustee shall
have been appointed or until its removal or resignation.  The Guarantee Trustee may resign from office
(without need for prior or subsequent accounting) by an instrument in writing
executed by the Guarantee Trustee and delivered to the Guarantor, which
resignation shall not take effect until a Successor Guarantee Trustee has been
appointed and has accepted such appointment by instrument in writing executed
by such Successor Guarantee Trustee and delivered to the Guarantor and the
resigning Guarantee Trustee.

 

(4)           If no Successor
Guarantee Trustee shall have been appointed and accepted appointment as
provided in this Section 402 within 60 days after delivery to the
Guarantor of an instrument of resignation, the resigning Guarantee Trustee may
petition, at the expense of the Guarantor, any court of competent jurisdiction
for appointment of a Successor Guarantee Trustee.  Such court may thereupon, after prescribing
such notice, if any, as it may deem proper, appoint a Successor Guarantee
Trustee.

 

11

 

ARTICLE FIVE

Guarantee

 

Section 501            Guarantee.  The Guarantor, irrevocably and
unconditionally agrees to pay in full to the Holders the Guarantee Payments
(without duplication of amounts theretofore paid by or on behalf of the
Issuer), as and when due, regardless of any defense, right of set-off or
counterclaim which the Issuer may have or assert.  The Guarantor’s obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
the Guarantor to the Holders or by causing the Issuer to pay such amounts to
the Holders.

 

Section 502            Waiver of Notice
and Demand.  The Guarantor hereby
waives notice of acceptance of the Guarantee Agreement and of any liability to which
it applies or may apply, presentment, demand for payment, any right to require
a proceeding first against the Guarantee Trustee, Issuer or any other Person
before proceeding against the Guarantor, protest, notice of nonpayment, notice
of dishonor, notice of redemption and all other notices and demands.

 

Section 503            Obligations Not
Affected.  The obligations,
covenants, agreements and duties of the Guarantor under this Guarantee
Agreement shall in no way be affected or impaired by reason of the happening
from time to time of any of the following:

 

(1)           the release or waiver,
by operation of law or otherwise, of the performance or observance by the
Issuer of any express or implied agreement, covenant, term or condition
relating to the Preferred Securities to be performed or observed by the Issuer;

 

(2)           the extension of time
for the payment by the Issuer of all or any portion of the Distributions (other
than an extension of time for payment of Distributions that results from the
extension of any interest payment period on the Debentures as so provided in
the Indenture), Redemption Price, Liquidation Distribution or any other sums
payable under the terms of the Preferred Securities or the extension of time
for the performance of any other obligation under, arising out of, or in
connection with, the Preferred Securities;

 

(3)           any failure, omission,
delay or lack of diligence on the part of the Holders to enforce, assert or
exercise any right, privilege, power or remedy conferred on the Holders
pursuant to the terms of the Preferred Securities, or any action on the part of
the Issuer granting indulgence or extension of any kind;

 

(4)           the voluntary or
involuntary liquidation, dissolution, sale of any collateral, receivership,
insolvency, bankruptcy, assignment for the benefit of 

 

12

 

creditors, reorganization, arrangement, composition or
readjustment of debt of, or other similar proceedings affecting, the Issuer or
any of the assets of the Issuer;

 

(5)           any invalidity of, or
defect or deficiency in, the Preferred Securities;

 

(6)           the settlement or
compromise of any obligation guaranteed hereby or hereby incurred; or

 

(7)           any other circumstance
whatsoever that might otherwise constitute a legal or equitable discharge or
defense of a guarantor, it being the intent of this Section 503 that the
obligations of the Guarantor hereunder shall be absolute and unconditional
under any and all circumstances.

 

There
shall be no obligation of the Holders to give notice to, or obtain the consent
of, the Guarantor with respect to the happening of any of the foregoing.

 

Section 504            Rights of Holders.  The Guarantor expressly acknowledges
that:  (i) this Guarantee
Agreement will be deposited with the Guarantee Trustee to be held for the benefit
of the Holders; (ii) the Guarantee Trustee has the right to enforce
this Guarantee Agreement on behalf of the Holders; (iii) the
Holders of a Majority in liquidation preference of the Preferred Securities
have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Guarantee Trustee in respect of this
Guarantee Agreement or exercising any trust or power conferred upon the
Guarantee Trustee under this Guarantee Agreement; and (iv) any
Holder may institute a legal proceeding directly against the Guarantor to
enforce its rights under this Guarantee Agreement, without first instituting a
legal proceeding against the Guarantee Trustee, the Issuer or any other Person.

 

Section 505            Guarantee of
Payment.  This Guarantee Agreement
creates a guarantee of payment and not of collection.  This Guarantee Agreement will not be
discharged except by payment of the Guarantee Payments in full (without
duplication of amounts theretofore paid by the Issuer) or upon distribution of
Debentures to Holders as provided in the Trust Agreement.

 

Section 506            Subrogation.  The Guarantor shall be subrogated to all (if
any) rights of the Holders against the Issuer in respect of any amounts paid to
the Holders by the Guarantor under this Guarantee Agreement and shall have the
right to waive payment by the Issuer pursuant to Section 501; provided,
however, that the Guarantor shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any rights
which it may acquire by way of subrogation or any indemnity, reimbursement or
other agreement, in all cases as a result of payment under this Guarantee
Agreement, if, at the time of any such payment, any amounts are due and unpaid
under this Guarantee Agreement.  If any
amount shall be paid to the Guarantor in

 

13

 

violation of the preceding sentence, the Guarantor
agrees to hold such amount in trust for the Holders and to pay over such amount
to the Holders.

 

Section 507            Independent
Obligations.  The Guarantor
acknowledges that its obligations hereunder are independent of the obligations
of the Issuer with respect to the Preferred Securities and that the Guarantor
shall be liable as principal and as debtor hereunder to make Guarantee Payments
pursuant to the terms of this Guarantee Agreement notwithstanding the
occurrence of any event referred to in subsections (1) through (7),
inclusive, of Section 503 hereof.

 

ARTICLE SIX

Covenants and Subordination

 

Section 601            Subordination.  This Guarantee Agreement will constitute an
unsecured obligation of the Guarantor and will rank subordinate and junior in
right of payment to all Senior Debt of the Guarantor.

 

Section 602            Pari Passu Guarantees.  This Guarantee Agreement shall rank pari passu with any similar Guarantee Agreements issued by
the Guarantor on behalf of the holders of Preferred Securities issued by
Principal Capital       , Principal Capital       
and Principal Capital      .

 

ARTICLE SEVEN

Termination

 

Section 701            Termination.  This Guarantee Agreement shall terminate and
be of no further force and effect upon (i) full payment of the
Redemption Price of all Preferred Securities, (ii) the distribution
of Debentures to the Holders in exchange for all of the Preferred Securities or
(iii) full payment of the amounts payable in accordance with the
Trust Agreement upon liquidation of the Issuer. 
Notwithstanding the foregoing, this Guarantee Agreement will continue to
be effective or will be reinstated, as the case may be, if at any time any
Holder must restore payment of any sums paid with respect to Preferred
Securities or this Guarantee Agreement.

 

ARTICLE EIGHT

 

Miscellaneous

 

Section 801            Successors and
Assigns.  All guarantees and
agreements contained in this Guarantee Agreement shall bind the successors,
assigns, receivers, trustees and representatives of the Guarantor and shall
inure to the benefit of the Holders of the Preferred Securities then
outstanding.  Except in connection with a
consolidation, merger

 

14

 

or sale involving the Guarantor that is permitted under Article Eight
of the Indenture and pursuant to which the assignee agrees in writing to
perform the Guarantor’s obligations hereunder, the Guarantor shall not assign
its obligations hereunder.

 

Section 802            Amendments.  Any amendment to this Guarantee Agreement
shall be in writing and executed by the Guarantor and Guarantee Trustee.  Except with respect to any changes which do
not adversely affect the rights of the Holders in any material respect (in
which case no consent of the Holders will be required), this Guarantee
Agreement may only be amended with the prior approval of the Holders of not
less than a Majority in liquidation preference of all the outstanding Preferred
Securities.  The provisions of Article VI
of the Trust Agreement concerning meetings of the Holders shall apply to the
giving of such approval.  The Guarantee
Trustee shall not be required to enter into any amendment to this Guarantee
Agreement which affects its own rights, duties or immunities under this
Guarantee Agreement.  The Guarantee
Trustee shall be entitled to receive and conclusively rely on an Opinion of
Counsel and an Officer’s Certificate stating that any amendment to this
Guarantee Agreement is in compliance with this Guarantee Agreement.

 

Section 803            Notices.  Any notice, request or other communication
required or permitted to be given hereunder shall be in writing, duly signed by
the party giving such notice, and delivered, telecopied or mailed by first
class mail as follows:

 

(1)           if given to the
Guarantor, to the address set forth below or such other address as the
Guarantor may give notice of to the Holders:

 

Principal Financial Group, Inc.

711 High Street

Des Moines, Iowa 50392 

Facsimile No.:  (515) [                      ]

Attention:  [Treasurer]

 

(2)           if given to the Issuer,
in care of the Guarantee Trustee, at the Issuer’s (and the Guarantee Trustee’s)
address set forth below or such other address as the Guarantee Trustee on
behalf of the Issuer may give notice to the Holders:

 

[                                    ]

c/o Principal Financial Group, Inc.

711 High Street

Des Moines, Iowa 50392 

Facsimile No.:  (515) [
              ]

Attention:  [Treasurer]

 

15

 

with a
copy to:

 

[                                    ]

[                                               ]

Facsimile No.: 
[                                               ]

Attention: 
[                                               ]

 

(3)           if given to any Holder,
at the address set forth on the books and records of the Issuer.

 

All
notices hereunder shall be deemed to have been given when received in person,
telecopied with receipt confirmed, or mailed by first class mail, postage
prepaid, except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the
date of such refusal or inability to deliver.

 

Section 804            Benefit.  This Guarantee Agreement is solely for the
benefit of the Holders and is not separately transferable from the Preferred
Securities.

 

Section 805            Interpretation.

 

In
this Guarantee Agreement, unless the context otherwise requires:

 

(1)           capitalized terms used
in this Guarantee Agreement but not defined in the preamble hereto have the
respective meanings assigned to them in Section 101;

 

(2)           a term defined anywhere
in this Guarantee Agreement has the same meaning throughout;

 

(3)           all references to “the
Guarantee Agreement” or “this Guarantee Agreement” are to this Guarantee
Agreement as modified, supplemented or amended from time to time;

 

(4)           all references in this
Guarantee Agreement to Articles and Sections are to Articles and Sections of
this Guarantee Agreement unless otherwise specified;

 

(5)           a term defined in the
Trust Indenture Act has the same meaning when used in this Guarantee Agreement
unless otherwise defined in this Guarantee Agreement or unless the context
otherwise requires;

 

(6)           a reference to the
singular includes the plural and vice versa; and

 

16

 

(7)           the masculine, feminine
or neuter genders used herein shall include the masculine, feminine and neuter
genders.

 

Section 806            Governing Law.  THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO THE CONFLICT OF LAW PRINCIPLES THEREOF.

 

This
instrument may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.

 

THIS
GUARANTEE AGREEMENT is executed as of the day and year first above written.

 

 

	
   

  	
  PRINCIPAL FINANCIAL GROUP, INC.,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [

  	
  ],

  
	
   

  	
  as Guarantee Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
				

 

17

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