-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CVt2zhXQTZ0T1Gxuv6c77QmLo32DIWHNwr8KzRrB1w7KgFynSPz7DHiC6wA8XXAk 17eABaNXxi7lujZDDVa3dQ== 0000950123-97-005938.txt : 19970718 0000950123-97-005938.hdr.sgml : 19970718 ACCESSION NUMBER: 0000950123-97-005938 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 10 REFERENCES 429: 033-00583 FILED AS OF DATE: 19970717 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: U S HOME CORP /DE/ CENTRAL INDEX KEY: 0000101640 STANDARD INDUSTRIAL CLASSIFICATION: OPERATIVE BUILDERS [1531] IRS NUMBER: 210718930 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 333-31457 FILM NUMBER: 97641751 BUSINESS ADDRESS: STREET 1: 1800 WEST LOOP SOUTH STREET 2: STE 1900 CITY: HOUSTON STATE: TX ZIP: 77027 BUSINESS PHONE: 7138772311 MAIL ADDRESS: STREET 1: PO BOX 2863 CITY: HOUSTON STATE: TX ZIP: 77252 FORMER COMPANY: FORMER CONFORMED NAME: UNITED STATES HOME & DEVELOPMENT CORP DATE OF NAME CHANGE: 19710713 S-3 1 FORM S-3 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 17, 1997 REGISTRATION NO. 333-_____ ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 U.S. HOME CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 21-0718930 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1800 WEST LOOP SOUTH HOUSTON, TX 77027 (713) 877-2311 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) ROBERT J. STRUDLER CHAIRMAN AND CO-CHIEF EXECUTIVE OFFICER U.S. HOME CORPORATION 1800 WEST LOOP SOUTH HOUSTON, TX 77027 (713) 877-2311 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copy to: STEPHEN C. KOVAL, ESQ. KAYE, SCHOLER, FIERMAN, HAYS & HANDLER, LLP 425 PARK AVENUE NEW YORK, NEW YORK 10022 APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to time after the effective date of this Registration Statement as determined by market conditions. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. / / If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered in connection with dividend or interest reinvestment plans, check the following box. /X/ If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement from the same offering. / / 2 If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / / If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. / /
CALCULATION OF REGISTRATION FEE Title of each class of Amount to be Proposed maximum Proposed maximum Amount of securities to be registered offering price per aggregate offering registration fee registered unit price - ------------------------------------------------------------------------------------------------------------------------ Senior, Senior $300,000,000 (1) 100% (1) $300,000,000 (1) $90,909.09 (2) Subordinated and/or Subordinated Debt Securities, Various Series
(1) Estimated solely for purposes of determining the registration fee. If any such Debt Securities are issued at an original issue discount, then the amount to be registered shall be in such greater principal amount as shall result in an aggregate initial offering price of up to $300,000,000. (2) An additional filing fee of $8,620.75 was previously paid for $25,000,000 of unsold Debt Securities registered under Registration No. 33-00583. Pursuant to Rule 429 under the Securities Act of 1933, the Prospectus included herein contains a combined Prospectus that also relates to a total of $25,000,000 of Debt Securities of the Registrant previously registered under the Registrant's Registration Statement No. 33-00583 (which was declared effective on February 8, 1996) and not issued. This Registration Statement constitutes Post-Effective Amendment No. 1 to the Registrant's Registration Statement on Form S-3 No. 33-00583 pursuant to which the total amount of unsold Debt Securities previously registered under the Registrant's Registration Statement on Form S-3 No. 33-00583 may be offered and sold as Debt Securities, without limitation as to class, together with the Debt Securities registered hereunder, through the use of the combined Prospectus included herein relating to Debt Securities. In the event that any of such previously registered Debt Securities are offered and sold prior to the effective date of this Registration Statement, the amount of such Debt Securities will not be included in any Prospectus hereunder. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. ================================================================================ 2 3 INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. SUBJECT TO COMPLETION, DATED JULY 17, 1997 $325,000,000 U.S. HOME CORPORATION Debt Securities ---------- U.S. Home Corporation ("U.S. Home" or the "Company") may offer from time to time, in one or more series, its debt securities, consisting of bonds, debentures, notes and/or other unsecured evidences of indebtedness. The debt securities may consist of the Company's unsecured senior debt securities (the "Senior Debt Securities"), unsecured senior subordinated debt securities (the "Senior Subordinated Debt Securities") or unsecured subordinated debt securities (the "Subordinated Debt Securities," and together with the Senior Debt Securities and the Senior Subordinated Debt Securities, the "Debt Securities"). The Debt Securities will have a maximum aggregate principal amount of $325,000,000 and will be offered on terms to be determined at the time of sale. The specific terms of the Debt Securities in respect of which this Prospectus is being delivered will be set forth in the supplement accompanying this Prospectus (the "Prospectus Supplement") and will include, where applicable, the specific title, the aggregate principal amount, the currency, authorized denominations, the maturity, the rate (or method of calculation) and time of payment of interest, if any, any redemption or sinking fund provisions, any additional covenants or events of default, the initial public offering price and the other material terms of the Debt Securities. The Prospectus Supplement will also disclose whether the Debt Securities will be listed on a national securities exchange and if they are not to be listed, the possible effects thereof on their marketability. Debt Securities may be offered by the Company directly to one or more purchasers, through agents designated from time to time by the Company or to or through underwriters and/or dealers. If any agent of the Company or any underwriter or dealer is involved in the sale of the Debt Securities, the name of such agent, underwriter or dealer and any applicable purchase price, fee, commission or discount arrangement between or among them will be set forth, or will be calculable from the information set forth, in the applicable Prospectus Supplement. See "Plan of Distribution." No Debt Securities may be sold without delivery of the applicable Prospectus Supplement describing the method and terms of the offering of such series of Debt Securities. ---------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ---------- The date of this Prospectus is --------------------, 1997 4 AVAILABLE INFORMATION The Company has filed with the Securities and Exchange Commission (the "Commission") a registration statement (together with all amendments and exhibits thereto, the "Registration Statement") under the Securities Act of 1933, as amended (the "Securities Act"), with respect to the Debt Securities offered hereby. This Prospectus, which constitutes part of the Registration Statement, does not contain all of the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the Commission. For further information with respect to the Company and the Debt Securities, reference is made to the Registration Statement. The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance therewith, files reports, proxy and information statements and other information with the Commission. The Registration Statement, as well as such reports, proxy and information statements and other information filed by the Company with the Commission, may be inspected and copied (at prescribed rates) at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 and at the Commission's regional offices located at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and Seven World Trade Center, 13th Floor, New York, New York 10048. The Commission also maintains an Internet Web Site at http://www.sec.gov that contains reports, proxy and information statements, and other information regarding registrants that file electronically with the Commission. In addition, such reports, proxy and information statements and other information concerning the Company may also be inspected at the offices of the New York Stock Exchange, at 20 Broad Street, New York, New York 10005. INCORPORATION OF CERTAIN INFORMATION BY REFERENCE The following documents filed by the Company with the Commission (File No. 1-5899) pursuant to the Exchange Act are incorporated herein by reference: (i) the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1996; and (ii) the Company's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1997. All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to the termination of the offering of the Debt Securities offered hereby shall be deemed incorporated by reference into this Prospectus and to be a part hereof from the date such documents are filed. Any statement contained herein or in a document incorporated or deemed to be incorporated by reference herein will be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in the applicable Prospectus Supplement or in any subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. The Company will provide without charge to each person to whom a copy of this Prospectus is delivered, upon the written or oral request of such person, a copy of each document incorporated herein by reference. Requests for such copies should be directed to Kelly F. Somoza, Vice President, U.S. Home Corporation, 1800 West Loop South, Houston, Texas 77027, (713) 877-2311. 2 5 THE COMPANY U.S. Home, organized in 1954 and incorporated in the State of Delaware in 1959, is one of the largest single-family home builders in the United States based on homes delivered. The Company currently builds and sells homes in more than 215 new home communities in 31 market areas in 12 states. Since its formation, the Company has delivered more than 271,000 homes. In 1996, the Company was the fifth largest single-family on-site home builder in the United States based on homes completed and delivered and has been among the ten largest single-family on-site home builders in the United States for more than 20 years. The Company conducts substantially all of its homebuilding business through U.S. Home, the parent company. The Company offers a wide variety of moderately-priced homes that are designed to appeal to the affordable, move-up and retirement and active-adult buyers. In each of its markets, the Company's primary strategy is to build quality homes, utilizing its Zero Defect Program, which the Company believes offers prospective home buyers a high level of new home value. The Company believes that many home purchasers compare homes on the basis of location, perceived quality and dollars of purchase price per square foot of living area. As a result, the Company attempts to purchase land and lots in popular growth corridors, maintain high quality standards and design homes to maximize living space. In addition to building and selling single-family homes, the Company provides mortgage banking services to its customers. The Company originates, processes and sells mortgages to third-party investors. The Company does not retain or service the mortgages that it originates but, rather, sells the mortgages and related servicing rights to investors. The principal executive offices of the Company are located at 1800 West Loop South, Houston, Texas 77027 (telephone: (713) 877-2311). USE OF PROCEEDS Unless otherwise set forth in the applicable Prospectus Supplement, the Company intends to use the net proceeds from the sale of the Debt Securities for general corporate purposes. CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES The following table sets forth the consolidated ratio of earnings to fixed charges for the Company for the periods indicated:
Three Months Ended March 31, Fiscal Year Ended December 31, -------------- -------------------------------------------- 1997 1996 1996 1995 1994 1993 1992 ---- ---- ---- ---- ---- ---- ---- Ratio of earnings to fixed charges (unaudited) (1)............................ 2.60 2.49 2.44 2.57 2.51 2.78 3.26
- --------------------------- (1) The ratio of earnings to fixed charges is calculated by dividing earnings by fixed charges. For this purpose, "earnings" means income (loss) before reorganization items plus (a) provision (benefit) for income taxes, and (b) fixed charges (including the proportionate share thereof of unconsolidated affiliates). "Fixed charges" means total interest, whether capitalized or expensed, and the portion of rent expense representative of interest costs (including the proportionate share thereof of unconsolidated affiliates), plus (i) debt-related fees and (ii) amortization of deferred financing costs. 3 6 DESCRIPTION OF DEBT SECURITIES The Debt Securities will constitute direct, unsecured obligations of the Company, unless otherwise provided in the applicable Prospectus Supplement. Senior Debt Securities may be issued from time to time in series under an indenture (the "Senior Indenture") between the Company and IBJ Schroder Bank & Trust Company, as trustee (the "Trustee"). See "-- Concerning the Trustee." The Senior Indenture has been filed as an exhibit to the Registration Statement of which this Prospectus is a part. Senior Subordinated Debt Securities may be issued from time to time in series under an indenture (the "Senior Subordinated Indenture") between the Company and the Trustee. The Senior Subordinated Indenture has been filed as an exhibit to the Registration Statement of which this Prospectus is a part. Subordinated Debt Securities may be issued from time to time in series under an indenture (the "Subordinated Indenture") between the Company and the Trustee. The Subordinated Indenture has been filed as an exhibit to the Registration Statement of which this Prospectus is a part. The Senior Indenture, the Senior Subordinated Indenture and the Subordinated Indenture are sometimes referred to individually as the "Indenture" and collectively as the "Indentures." The Indentures will be subject to and governed by the Trust Indenture Act of 1939, as amended (the "TIA"). As used under this caption, unless the context otherwise requires, "Offered Debt Securities" shall mean the Debt Securities offered by this Prospectus and the accompanying Prospectus Supplement. The following summaries of certain provisions of the Indentures do not purport to be complete and are subject to, and are qualified in their entirety by reference to, all of the provisions of the Indentures, including the definitions therein of certain capitalized terms used in this Prospectus. The following sets forth certain general terms and provisions of the Debt Securities to which any Prospectus Supplement may relate. Further terms of the Offered Debt Securities will be described in the Prospectus Supplement. Except (i) with respect to the covenants described herein for Senior Subordinated Debt Securities, (ii) with respect to the provisions relating to subordination and (iii) to the extent set forth in a Prospectus Supplement with respect to a particular series of Debt Securities, the Indentures are substantially identical. See "-- Senior Subordinated Indenture Covenants" and "-- Status of Debt Securities." GENERAL Each Indenture will provide for the issuance of Debt Securities in one or more series. The Debt Securities will be unsecured senior, senior subordinated or subordinated obligations of the Company, as set forth in the accompanying Prospectus Supplement. Except as may be set forth in the accompanying Prospectus Supplement and as described herein relating to the Senior Subordinated Indenture, the Indentures will not restrict the business or operations of the Company or its subsidiaries, limit their indebtedness or prohibit any liens, charges or other encumbrances on any properties or other assets they may have from time to time. See "-- Senior Subordinated Indenture Covenants." The applicable Prospectus Supplement or Prospectus Supplements will describe the following terms of the series of Offered Debt Securities in respect of which this Prospectus is being delivered, if applicable: (i) the title of the Offered Debt Securities; (ii) whether the Offered Debt Securities are Senior Debt Securities, Senior Subordinated Debt Securities or Subordinated Debt Securities; (iii) the aggregate principal amount of the Offered Debt Securities and any limit on such aggregate principal amount; (iv) the person to whom interest on an Offered Debt Security will be payable, if other than the person in whose name the Offered Debt Security is registered on the record date for the payment of such interest; (v) the date or dates, or method by which such date or dates will be determined, on which the principal of the Offered Debt Securities will be payable; (vi) the rate or rates at which the Offered Debt Securities will bear interest, if any, or the method by which such rate or rates will be determined; (vii) the date or dates from which interest, if any, will accrue, or the method by which such date or dates will be determined, the interest payment dates on which any such interest will be payable and the record date, if any, for the interest payable on any Offered Debt Security on any interest payment date, or the method by which such date or dates will be determined, and the basis upon which interest will be calculated if other than on the basis of actual days elapsed over a 365 or 366-day year; (viii) the place or places, if any, other than or in addition to New York, New York, where the principal of and interest on Offered Debt Securities will be payable, any Offered Debt Securities may be surrendered for registration of transfer, any Offered Debt Securities may be surrendered for 4 7 exchange and the place or places where notices or demands to or upon the Company in respect of the Offered Debt Securities and the applicable Indenture may be served; (ix) the period or periods within, the price or prices at and the terms and conditions upon, which the Offered Debt Securities may be redeemed or purchased, in whole or in part, at the option of the Company; (x) the obligation, if any, of the Company to redeem or repurchase the Offered Debt Securities pursuant to any sinking fund or analogous provisions or at the option of a holder thereof and the period or periods within which, the prices at which and the terms and conditions upon which Offered Debt Securities will be redeemed or purchased, in whole or in part, pursuant to such obligation; (xi) if other than denominations of $1,000 and any integral multiple thereof, the denomination in which the Offered Debt Securities will be issuable; (xii) the currency, currencies or currency units in which payment of the principal of and interest on any Offered Debt Securities will be payable if other than the currency of the United States and the manner of determining the equivalent thereof in the currency of the United States for purposes of the definition of "Outstanding" in the applicable Indenture; (xiii) if the principal of or interest on any Offered Debt Securities is to be payable, at the election of the Company or a holder thereof, in one or more currencies or currency units other than that or those in which the Offered Debt Securities are stated to be payable, the currency, currencies or currency units in which payment of the principal of and interest on Offered Debt Securities as to which such election is made will be payable, and the periods within which and the terms and conditions upon which such election is to be made; (xiv) if the amount of principal of or interest on any Offered Debt Securities may be determined with reference to an index, the manner in which such amounts will be determined; (xv) if other than the principal amount of the Offered Debt Securities, the portion of the principal amount thereof which will be payable upon declaration of acceleration of the maturity thereof; (xvi) if the Offered Debt Securities will be issuable in whole or in part in the form of one or more Global Securities (as defined) and, in such case, the Depository or Depositories for such Global Security or Global Securities and any circumstances other than those set forth herein in which any such Global Security may be transferred to, and registered and exchanged for Offered Debt Securities registered in the name of, a person other than the Depository for such Global Security or a nominee thereof and in which any such transfer may be registered; (xvii) if other than the Trustee, the identity of each paying agent and registrar for the Offered Debt Securities; (xviii) any Events of Default (as defined) with respect to the Offered Debt Securities, if not otherwise set forth under the caption "-- Events of Default" or if different from these set forth herein; (xix) any material covenants with respect to the Offered Debt Securities, if not otherwise set forth herein or if different from those set forth herein; (xx) the applicability of the provisions described under the caption "-- Discharge of the Indenture"; and (xxi) any other material terms of the Offered Debt Securities. Debt Securities may be issued at a discount from their principal amount. Federal income tax considerations and other special considerations applicable to any such Offered Debt Securities will be described in the applicable Prospectus Supplement. If the purchase price of any of the Offered Debt Securities is denominated in a foreign currency or currencies or a foreign currency unit or units or if the principal of, or interest, if any, on, any series of Debt Securities is payable in a foreign currency or currencies or a foreign currency unit or units, the restrictions, elections, general tax considerations, specific terms and other information with respect to such Offered Debt Securities and such foreign currency or currencies or foreign currency unit or units will be set forth in the applicable Prospectus Supplement. GLOBAL SECURITIES Unless otherwise provided in the applicable Prospectus Supplement, the Offered Debt Securities will be issued in the form of one or more global securities (each a "Global Security") registered in the name of a nominee of The Depository Trust Company (the "Depository"). The identity of the nominee appointed by the Depository will be set forth in the applicable Prospectus Supplement. The Global Security will be issued in a denomination or aggregate denominations equal to the portion of the aggregate principal amount of the outstanding Debt Securities of the series represented by such Global Security. Except as described herein or in the applicable Prospectus Supplement, Debt Securities will not be issued in definitive form. 5 8 The specific terms of the depositary arrangement with respect to any portion of a series of Debt Securities to be represented by a Global Security will be described in the applicable Prospectus Supplement. The Company expects that the following provisions will apply to depositary arrangements. Upon the issuance of a Global Security, the Depository or its nominee will credit the accounts of persons holding through it with the respective principal amounts of the Debt Securities represented by such Global Security. Such accounts will be designated by the underwriter, if any, with respect to Debt Securities placed by the underwriter for the Company. Ownership of beneficial interests in a Global Security will be limited to persons that have accounts with the Depository ("participants") or persons that may hold interests through participants. Ownership of beneficial interests by participants in a Global Security will be shown on, and the transfer of that ownership interest will be effected only through, records maintained by the Depository for such Global Security. Ownership of beneficial interests in such Global Security by persons that hold through participants will be shown on, and the transfer of that ownership interest through such participant will be effected only through, records maintained by such participant. The foregoing may impair the ability to transfer beneficial interests in a Global Security. Except as provided in the applicable Prospectus Supplement, payment of principal and interest, if any, on Debt Securities represented by any such Global Security will be made to the Depository or its nominee, as the case may be, as the sole registered holder of the Debt Securities represented thereby for all purposes under the applicable Indenture. None of the Company, the Trustee, any agent of the Company or the Trustee or the underwriter, if any, will have any responsibility or liability for any aspect of the Depository's records relating to or payments made on account of beneficial ownership interests in a Global Security representing any Debt Securities or for maintaining, supervising or reviewing any of the Depository's records relating to such beneficial ownership interests. The Company has been advised by the Depository that, upon receipt of any payment of principal or interest on any Global Security, the Depository will immediately credit, on its book-entry registration and transfer system, the accounts of participants with payments in amounts proportionate to their respective beneficial interests in the principal amount of such Global Security as shown on the records of the Depository. Payments by participants to owners of beneficial interests in a Global Security held through such participants will be governed by standing instructions and customary practices as is now the case with securities held for customer accounts registered in "street name," and will be the sole responsibility of such participants. Except as described in the applicable Prospectus Supplement, a Global Security may not be transferred except as a whole by the Depository for such Global Security to a nominee of such Depository or by a nominee of such Depository to such Depository or another nominee of such Depository or by such Depository or any such nominee to a successor of such Depository or a nominee of such successor. If the Depository is at any time unwilling or unable to continue as depository and a successor depository is not appointed by the Company or the Depository within 90 days, the Company will issue Debt Securities in definitive form in exchange for the Global Security. In addition, the Company or the Depository may at any time and in its sole discretion determine not to have the Debt Securities represented by the Global Security and, in such event, the Company will issue Debt Securities in definitive form in exchange for the Global Security. In either instance, an owner of a beneficial interest in the Global Security will be entitled to have Debt Securities equal in principal amount to such beneficial interest registered in its name and will be entitled to physical delivery of such Debt Securities in definitive form. Except as described in the applicable Prospectus Supplement, Debt Securities so issued in definitive form will be issued in denominations of $1,000 and integral multiples thereof and will be issued in registered form only, without coupons. Except as described in the applicable Prospectus Supplement, principal and interest, if any, on the Debt Securities will be payable, and the Debt Securities may be presented for registration of transfer or exchange, at the offices of the Trustee. So long as the Depository for a Global Security, or its nominees, is the registered owner of such Global Security, such Depository or such nominee, as the case may be, will be considered the sole registered holder of the Debt Securities represented by such Global Security for all purposes of receiving payment on the Debt Securities, receiving notices and for all other purposes under the Indenture and the Debt Securities. Beneficial 6 9 interests in Debt Securities will be evidenced only by, and transfers thereof will be effected only through, records maintained by the Depository and its participants. Except as provided above, owners of beneficial interests in a Global Security will not be entitled to and will not be considered the registered holders thereof for any purposes under the Indenture. Accordingly, any such person owning a beneficial interest in such a Global Security must rely on the procedures of the Depository, and, if any such person is not a participant, on the procedures of the participant through which such person owns its interest, to exercise any rights of a registered holder under the Indenture. The Indenture provides that the Depository may grant proxies and otherwise authorize participants to give or take any request, demand, authorization, direction, notice, consent, waiver or other action which a registered holder is entitled to give or take under the Indenture. The Company understands that under existing industry practices, in the event that the Company requests any action of registered holders or that an owner of a beneficial interest in such a Global Security desires to give or take any action which a registered holder is entitled to give or take under the Indenture, the Depository would authorize the participants holding the relevant beneficial interest to give or take such action and such participants would authorize beneficial owners owning through such participants to give or take such action or would otherwise act upon the instructions of beneficial owners owning through them. The Depository has advised the Company that the Depository is a limited-purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered under the Exchange Act. The Depository was created to hold the securities of its participants and to facilitate the clearance and settlement of securities transactions among its participants in such securities through electronic book-entry changes in accounts of the participants, thereby eliminating the need for physical movement of securities certificates. The Depository's participants include securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations, some of whom (and/or their representatives) own the Depository. Access to the Depository's book-entry system is also available to others, such as banks, brokers, dealers and trust companies, that clear through or maintain a custodial relationship with a participant, either directly or indirectly. STATUS OF DEBT SECURITIES The Senior Debt Securities will be unsecured and unsubordinated obligations of the Company and will rank on a parity with all other unsecured and unsubordinated indebtedness of the Company. All series of Senior Debt Securities of the Company issued under the Senior Indenture will rank on parity in right of payment with each other, with indebtedness under the Company's principal credit facility, with the Company's 9-3/4% senior notes due 2003, previously issued in the original principal amount of $200,000,000 under an Indenture, dated as of June 21, 1993, between the Company and IBJ Schroder Bank & Trust Company, as trustee (the "1993 Senior Notes"), and with the Company's 7.95% senior notes due 2001, previously issued in the original principal amount of $75,000,000 under an Indenture, dated as of February 16, 1996, between the Company and IBJ Schroder Bank & Trust Company, as trustee (the "1996 Senior Notes"). The Senior Debt Securities offered hereby will be senior in right of payment to the Company's 4-7/8% convertible subordinated debentures due 2005, previously issued in the original principal amount of $80,000,000 under an Indenture, dated as of November 3, 1993, between the Company and Marine Midland Bank, N.A., as trustee (the "Debentures"). The Senior Subordinated Debt Securities will be unsecured obligations of the Company and will be subordinate and junior in right of payment, to the extent and in the manner to be set forth in the Senior Subordinated Indenture to the prior payment in full in cash (or cash equivalents) of amounts then due on "Senior Indebtedness" of the Company. Except to the extent set forth in the applicable Prospectus Supplement, the Senior Subordinated Indenture will define "Senior Indebtedness" of the Company as the principal of (and premium, if any), and interest on (including, without limitation, interest accruing subsequent to the filing of a petition under applicable Bankruptcy Law (as defined in the Senior Subordinated Indenture) or the appointment of a Custodian (as defined in the Senior Subordinated Indenture)), (i) any and all indebtedness and obligations of the Company (including indebtedness of others guaranteed by the Company), whether or not contingent and whether or not outstanding on the Issue Date (as defined in the Senior Subordinated Indenture) or thereafter created, incurred or assumed (including, without limitation, all charges, fees, expenses and other amounts incurred by or owing to 7 10 holders of such indebtedness), which (a) is for money borrowed, (b) is evidenced by any bond, note, debenture or similar instrument, (c) represents the unpaid balance on the purchase price of any property, business or asset of any kind, (d) is an obligation of the Company as lessee under any and all leases of property, equipment or other assets required to be capitalized on the balance sheet of the lessee under generally accepted accounting principles, (e) is a reimbursement obligation of the Company with respect to letters of credit, (f) is an obligation of the Company with respect to an interest swap obligation or foreign exchange agreement or (g) is an obligation of another secured by a lien to which any of the properties or assets (including, without limitation, leasehold interests and any other tangible or intangible property rights) of the Company is subject, whether or not the obligations secured thereby shall have been assumed by the Company or will otherwise be the Company's legal liability and (ii) any deferrals, amendments, renewals, extensions, modifications and refundings of any indebtedness or obligations of the types referred to in clause (i) of this paragraph; provided that Senior Indebtedness will not include (A) the Senior Subordinated Debt Securities or the Subordinated Debt Securities, (B) the Debentures, (C) any indebtedness or obligation of the Company (or the instrument creating or evidencing it) which expressly provides that such indebtedness is not superior in right of payment to the Senior Subordinated Debt Securities, or which expressly provides that such indebtedness is subordinate in right of payment to all other indebtedness of the Company (including the Senior Subordinated Debt Securities), (D) any indebtedness or obligation of the Company to any of its subsidiaries and (E) any indebtedness or obligation incurred by the Company in connection with the purchase of assets, materials or services in the ordinary course of business and which constitutes a trade payable. The Subordinated Debt Securities will be unsecured obligations of the Company and will be subordinate and junior in right of payment, to the extent and in the manner to be set forth in the Subordinated Indenture to the prior payment in full in cash (or cash equivalents) of amounts then due on "Senior Indebtedness" of the Company. Except to the extent set forth in the applicable Prospectus Supplement, the Subordinated Indenture will define "Senior Indebtedness" of the Company as the principal of (premium, if any), and interest on (including, without limitation, interest accruing subsequent to the filing of a petition under applicable Bankruptcy Law (as defined in the Subordinated Indenture) or the appointment of a Custodian (as defined in the Subordinated Indenture)), (i) any and all indebtedness and obligations of the Company (including indebtedness of others guaranteed by the Company), whether or not contingent and whether or not outstanding on the Issue Date (as defined in the Subordinated Indenture) or thereafter created, incurred or assumed (including, without limitation, all charges, fees, expenses and other amounts incurred by or owing to holders of such indebtedness), which (a) is for money borrowed, (b) is evidenced by any bond, note, debenture or similar instrument, (c) represents the unpaid balance on the purchase price of any property, business or asset of any kind, (d) is an obligation of the Company as lessee under any and all leases of property, equipment or other assets required to be capitalized on the balance sheet of the lessee under generally accepted accounting principles, (e) is a reimbursement obligation of the Company with respect to letters of credit, (f) is an obligation of the Company with respect to an interest swap obligation or foreign exchange agreement or (g) is an obligation of another secured by a lien to which any of the properties or assets (including, without limitation, leasehold interests and any other tangible or intangible property rights) of the Company is subject, whether or not the obligations secured thereby shall have been assumed by the Company or will otherwise be the Company's legal liability and (ii) any deferrals, amendments, renewals, extensions, modifications and refundings of any indebtedness or obligations of the types referred to in clause (i) of this paragraph; provided that Senior Indebtedness will not include (A) the Subordinated Debt Securities, (B) the Debentures, (C) any indebtedness or obligation of the Company (or the instrument creating or evidencing it) which expressly provides that such indebtedness is not superior in right of payment to the Subordinated Debt Securities, or which expressly provides that such indebtedness is subordinate in right of payment to all other indebtedness of the Company (including the Subordinated Debt Securities), (D) any indebtedness or obligation of the Company to any of its subsidiaries and (E) any indebtedness or obligation incurred by the Company in connection with the purchase of assets, materials or services in the ordinary course of business and which constitutes a trade payable. The Senior Subordinated Debt Securities will constitute "Senior Indebtedness" with respect to the Subordinated Debt Securities and the Debentures. 8 11 The Senior Subordinated Indenture will provide that the Company will not issue any indebtedness that is subordinated in right of payment to any Senior Indebtedness of the Company and is senior in right of payment to the Senior Subordinated Debt Securities. The Subordinated Indenture will not contain a similar provision. By reason of such subordination, in the event of dissolution, winding-up, liquidation, insolvency, bankruptcy or other similar proceedings, upon any distribution of assets of the Company: (i) holders of Senior Indebtedness will be entitled to be paid in full before payments may be made on Senior Subordinated Debt Securities and the Subordinated Debt Securities and the holders of Senior Subordinated Debt Securities and Subordinated Debt Securities will be required to pay over their share of such distributions to the holders of Senior Indebtedness until such Senior Indebtedness is paid in full, except that holders of Senior Subordinated Debt Securities and Subordinate Debt Securities may receive securities that are subordinated at least to the same extent as such Senior Subordinated Debt Securities or Subordinated Debt Securities, as the case may be; (ii) in addition, holders of Senior Subordinated Debt Securities will be entitled to be paid in full before payments may be made on Subordinated Debt Securities and holders of Subordinated Debt Securities will be required to pay over their share of such distributions to the holders of Senior Subordinated Debt Securities until such Senior Subordinated Debt Securities are paid in full, except that holders of Subordinated Debt Securities may receive securities that are subordinated at least to the same extent as such Subordinated Debt Securities; and (iii) creditors of the Company who are not holders of Senior Subordinated Debt Securities or Subordinated Debt Securities may recover less, ratably, than holders of Senior Indebtedness and may recover more, ratably, than the holders of the Senior Subordinated Debt Securities or Subordinated Debt Securities. Accordingly, such subordination may result in a reduction or elimination of payments to the holders of all Senior Subordinated Debt Securities and Subordinated Debt Securities. Except as may otherwise be described in the applicable Prospectus Supplement, no payment of principal or interest on any of the Offered Debt Securities that are Senior Subordinated Debt Securities or Subordinated Debt Securities may be made by the Company, nor may the Company acquire any Offered Debt Securities that are Senior Subordinated Debt Securities or Subordinated Debt Securities for cash or property (other than securities that are subordinated at least to the same extent as such Senior Subordinated Debt Securities or Subordinated Debt Securities, as the case may be), in each case except as set forth in the Indenture for such Offered Debt Securities, if (i) a default in the payment of principal, premium, if any, or interest on any Designated Senior Indebtedness occurs and continues beyond the applicable period of grace, if any, specified in the applicable instrument, lease, contract, agreement or other document evidencing such Designated Senior Indebtedness, or (ii) a default, other than a payment default, with respect to any Designated Senior Indebtedness occurs and is continuing that permits the holders of the Designated Senior Indebtedness to accelerate its maturity and the Trustee receives a notice of the default from a person permitted to give such notice under the Indenture requesting that payment of principal or interest with respect to the Offered Debt Securities that are Senior Subordinated Debt Securities or Subordinated Debt Securities be prohibited; provided that the foregoing will not prohibit payments made in accordance with the defeasance or satisfaction and discharge provisions of the applicable Indenture from monies deposited with the Trustee in accordance with such provisions prior to any such default, judicial proceeding or notice. However, except as may otherwise be described in the applicable Prospectus Supplement, the Company may resume payments in respect of the Offered Debt Securities that are Senior Subordinated Debt Securities or Subordinated Debt Securities and may acquire such Senior Subordinated Debt Securities or Subordinated Debt Securities upon the earlier of (a) the date upon which the default or event of default with respect to such Designated Senior Indebtedness is cured or waived or ceases to exist or (b) in the case of an event of default referred to in (ii) above, the expiration of 179 days pass after notice is received (a "Payment Blockage Period"); provided, that the terms of the Indenture otherwise permit the payment or acquisition of such Offered Debt Securities at the time in question. Only one Payment Blockage Period may be commenced within any consecutive 365-day period in respect of the Offered Debt Securities that are Senior Subordinated Debt Securities or Subordinated Debt Securities, and in no event will a Payment Blockage Period extend beyond 179 days from the date payment on such Offered Debt Securities is due. For the purpose of the provisions described in this paragraph, no default which, to the knowledge of certain specified authorized persons, existed or was continuing on the date of the commencement of any Payment Blockage Period by such person, shall be made the basis for the commencement of a subsequent Payment Blockage Period by such person, whether or not within any consecutive 365-day period, unless such default is cured or waived or ceases to exist, or the benefits of the provisions of the applicable Indenture described in this paragraph are waived in writing by such authorized persons for a period of not less than 90 consecutive days. Except to the extent set forth in the applicable Prospectus Supplement, the Senior Subordinated Indenture and the Subordinated Indenture will define "Designated Senior Indebtedness" of the Company as (1) Senior Indebtedness of the Company permitted to be incurred under the applicable Indenture under any institutional credit agreement (including, the Company's existing principal credit facility) and (ii) any other Senior Indebtedness permitted to be incurred under the applicable Indenture the principal amount of which is $25,000,000 or more. Except as may otherwise be described in the applicable Prospectus Supplement, the subordination provision described herein will not prevent the occurrence of any Event of Default under the Senior Subordinated Indenture or the Subordinated Indenture. The Indentures for the 1993 Senior Notes and the 1996 Senior Notes and the Company's principal credit facility restrict the acquisition by the Company of its subordinated indebtedness, including any Senior Subordinated Debt Securities or Subordinated Debt Securities. In addition, the claims of third parties to the assets of the Company's subsidiaries incurring obligations to such third parties will be superior to those of the Company as a stockholder, and therefore the Offered Debt Securities may be deemed to be effectively subordinated to the claims of such third parties. 9 12 CERTAIN COVENANTS OF THE COMPANY Affirmative Covenants. In addition to such other covenants, if any, as may be described in the applicable Prospectus Supplement and as described herein relating to the Senior Subordinated Indenture, the Indenture for the Offered Debt Securities will require the Company, subject to certain limitations described therein, to, among other things, do the following: (i) pay the principal of, and interest on, the Offered Debt Securities when the same shall be due and payable; (ii) maintain an office or agency where Offered Debt Securities may be surrendered for payment or registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Offered Debt Securities and the Indenture may be served; (iii) deliver to the Trustee copies of all reports filed with the Commission; (iv) deliver to the Trustee annual officers' certificates with respect to the Company's compliance with its obligations under that Indenture; (v) maintain its corporate existence subject to the provisions described below under the caption "-- Certain Covenants of the Company -- Limitations on Mergers and Consolidations;" (vi) pay its taxes when due except where such taxes are being contested in good faith; and (vii) maintain insurance in at least such amounts and against such risks as are usually and prudently insured against in the same general area by companies engaged in the same or a similar business. Except as may be set forth in the accompanying Prospectus Supplement and as described herein relating to the Senior Subordinated Indenture, the Indentures will not restrict the business or operations of the Company or its subsidiaries, limit their indebtedness or prohibit any liens, charges or other encumbrances on any properties or other assets they may have from time to time. See "-- Senior Subordinated Indenture Covenants." Limitations on Mergers and Consolidations. Except as may otherwise be provided in the applicable Prospectus Supplement and as described under the caption "Senior Subordinated Indenture Covenants," the Indenture for the Offered Debt Securities will provide that the Company will not consolidate or merge with or into or sell, lease, convey or otherwise dispose of all or substantially all of its assets (including, without limitation, by way of liquidation or dissolution) or assign any of its obligations under the Indenture or the Offered Debt Securities (as an entirety or substantially an entirety in one transaction or series of related transactions), to any person unless (i) the person formed by or surviving such consolidation or merger (if other than the Company), or to which sale, lease, conveyance or other disposition or assignment will be made (collectively, the "Successor"), is a solvent corporation or other legal entity organized and existing under the laws of the United States, one of the states thereof or the District of Columbia, and the Successor expressly assumes by supplemental indenture all of the obligations of the Company under the Offered Debt Securities and the Indenture related thereto, (ii) immediately after giving effect to such transaction, no default or Event of Default has occurred and is continuing, and (iii) certain other conditions are met. Upon compliance with these provisions by the Successor, the Company would be relieved of its obligations under the Indenture and the Offered Debt Securities. No quantitative or other established meaning has been given to the phrase "all or substantially all" by courts which have interpreted this phrase in various contexts. In interpreting this phrase, courts make a subjective determination as to the portion of assets conveyed, considering such factors as the value of the assets conveyed and the proportion of an entity's income derived from the assets conveyed. Accordingly, there may be uncertainty as to whether a holder of Offered Debt Securities can determine whether the Company has sold, leased, conveyed or otherwise disposed of all or substantially all of its assets and exercise any remedies such holder may have upon the occurrence of any such transaction. SENIOR SUBORDINATED INDENTURE COVENANTS In addition to the other covenants set forth in the Prospectus and except as otherwise provided in a Prospectus Supplement relating to the Offered Debt Securities which are Senior Subordinated Debt Securities, the Senior Subordinated Indenture will include the following covenants: Reports to Holders of Senior Subordinated Debt Securities. The Senior Subordinated Indenture will provide that as long as more than 10 percent of the original amount of the Offered Debt Securities is outstanding, the Company will (i) remain subject to the requirements of Section 13 or 15(d) of the Exchange Act whether or not it is required to do so by the provisions thereof and will file with the Commission all periodic reports as may be required thereunder and (ii) file with the Commission, and with the Trustee within 15 days after the Company is required to file the same with the Commission, copies of the periodic reports which the Company may be 10 13 required to file with the Commission pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act. The Company will also make such reports available to the Holders, prospective purchasers of the Offered Debt Securities, securities analysts and broker-dealers upon their written request. The Senior Subordinated Indenture will also provide that in the event that (i) 10 percent or less of the original principal amount of the Offered Debt Securities are outstanding and (ii) the Company is not required to file with the Commission such reports and other information referred to in the preceding paragraph, the Company will furnish to the Trustee (A) within 120 days after the end of each fiscal year, annual reports containing the information required to be contained in Items 1, 2, 3, 5, 6, 7, 8 and 9 of the Annual Report on Form 10-K promulgated under the Exchange Act, or substantially the same information required to be contained in comparable items of any successor form, (B) within 60 days after the end of each of the first three fiscal quarters of each fiscal year, quarterly reports containing the information required to be contained in the Quarterly Report on Form 10-Q promulgated under the Exchange Act, or substantially the same information required to be contained in any successor form, and (C) promptly from the time after the occurrence of an event which would be required to be reported in the Current Report on Form 8-K if the Company was required to file such Report, such other reports containing information required to be contained in the Current Report on Form 8-K promulgated under the Exchange Act, or substantially the same information required to be contained in any successor form. The Senior Subordinated Indenture will also provide that the Company will also comply with the other provisions of Section 314(a) of the TIA. Limitations on Restricted Payments. The Senior Subordinated Indenture will provide that the Company will not, and will not permit any of its Restricted Subsidiaries to, make any Restricted Payment, directly or indirectly, after the Issue Date if at the time of such Restricted Payment: (i) the amount of such Restricted Payment (the amount of such Restricted Payment, if other than in cash, will be determined by the Board of Directors of the Company), when added to the aggregate amount of all Restricted Payments made after the Issue Date, exceeds the sum of: (1) $100,000,000, plus (2) 50 percent of the Company's Consolidated Net Income accrued during the period (taken as a single period) since January 1, 1997 (or, if such aggregate Consolidated Net Income is a deficit, minus 100 percent of such aggregate deficit), plus (3) the net cash proceeds derived from the issuance and sale of Capital Stock of the Company and its Restricted Subsidiaries that is not Disqualified Stock (other than a sale to a Subsidiary of the Company) after the Issue Date but only to the extent not applied under clause (c) of the definition of "Restricted Payment" set forth herein, plus (4) 100 percent of the principal amount of any Indebtedness of the Company or a Restricted Subsidiary that is converted into or exchanged for Capital Stock of the Company that is not Disqualified Stock, plus (5) 100 percent of the aggregate amounts received by the Company or any Restricted Subsidiary upon the sale, disposition or liquidation (including by way of dividends) of any Investment but only to the extent (x) not included in Consolidated Net Income in clause (i)(2) above and (y) that the making of such Investment constituted a Restricted Investment made pursuant to the provisions of the Senior Subordinated Indenture described in this paragraph, plus (6) 100 percent of the principal amount of, or if issued at a discount the accreted value of, any Indebtedness or other obligation that is the subject of a guaranty by the Company which is released after the Issue Date, but only to the extent that the granting of such guaranty constituted a "Restricted Payment" under the definition thereof set forth in the Senior Subordinated Indenture and described herein; or (ii) the Company would be unable to incur an additional $1.00 of Indebtedness under the ratio of the Company's Indebtedness (excluding Non-Recourse Indebtedness) to Consolidated Tangible Net Worth set forth under the caption "--Limitations on Additional Indebtedness"; or (iii) a Default or Event of Default has occurred and is continuing or occurs as a consequence thereof. 11 14 Notwithstanding the foregoing, the provisions of the Senior Subordinated Indenture described above will not prevent: (i) the payment of any dividend within 60 days after the date of declaration thereof if the payment thereof would have complied with the limitations of the Senior Subordinated Indenture on the date of declaration or (ii) the retirement of shares of the Company's Capital Stock or the Company's or a Subsidiary of the Company's Indebtedness for, in exchange for or out of the proceeds of a substantially concurrent sale (other than a sale to a Subsidiary of the Company) of, other shares of its Capital Stock (other than Disqualified Stock). Limitations on Additional Indebtedness. The Senior Subordinated Indenture will provide that the Company will not, and will not permit any of its Restricted Subsidiaries to, Incur any additional Indebtedness (other than Indebtedness between the Company and its Restricted Subsidiaries which are Wholly Owned Subsidiaries or among such Restricted Subsidiaries which are Wholly Owned Subsidiaries), including Acquisition Debt, unless, after giving effect thereto or the application of the proceeds therefrom, the ratio of the Company's Indebtedness (excluding, for purposes of this calculation, Non-Recourse Indebtedness) to Consolidated Tangible Net Worth on the date thereof is not greater than 3.0 to 1.0. Notwithstanding the foregoing, the provisions of the Senior Subordinated Indenture will not prevent: (i) in addition to the Indebtedness permitted to be Incurred under clauses (ii), (iii) and (iv) of this sentence and Indebtedness permitted to be Incurred under the provisions of the Senior Subordinated Indenture described in the preceding paragraph, the Company and/or any Restricted Subsidiary from Incurring (A) Refinancing Indebtedness, (B) Non-Recourse Indebtedness, and (C) Indebtedness Incurred for working capital purposes or to finance the acquisition, holding or development of property by the Company and its Restricted Subsidiaries (including, without limitation, the financing of any related interest reserve) in the ordinary course of business in an aggregate amount at any one time outstanding not to exceed $50,000,000 (excluding any Indebtedness referred to in clauses (i)(A), (i)(B), (ii), (iii) and (iv) of this paragraph), (ii) Unrestricted Subsidiaries from Incurring Indebtedness, (iii) the Company and its Restricted Subsidiaries from Incurring Indebtedness under any deposits made to secure performance of tenders, bids, leases, statutory obligations, surety and appeal bonds, progress statements, government contracts and other obligations of like nature (exclusive of the obligation for the payment of borrowed money), in each case Incurred in the ordinary course of business of the Company or any Restricted Subsidiary consistent with past practice and (iv) Restricted Subsidiaries from guaranteeing Indebtedness of the Company or another Restricted Subsidiary. Change of Control. The Senior Subordinated Indenture will provide that, following the occurrence of any Change of Control, the Company will so notify the Trustee in writing by delivery of an Officers' Certificate and will offer to purchase (a "Change of Control Offer") from all Holders, and will purchase from Holders accepting such Change of Control Offer on the date fixed for the closing of such Change of Control Offer (the "Change of Control Payment Date"), the Outstanding Offered Debt Securities at an offer price (the "Change of Control Price") in cash in an amount equal to 101 percent of the aggregate principal amount thereof plus accrued and unpaid interest, if any, to the Change of Control Payment Date in accordance with the procedures set forth in the "Change of Control" covenant of the Senior Subordinated Indenture. In addition, the Senior Subordinated Indenture will provide that, within 30 days after the date of any Change of Control, the Company (with written notice to the Trustee) or the Trustee at the Company's request (and at the expense of the Company), will send or cause to be sent by first-class mail, postage prepaid, to all Holders on the date of the Change of Control at their respective addresses appearing in the Security Register, a notice, prepared by the Company advising such Holders of such occurrence and of such Holder's rights arising as a result thereof. Such notice will contain all instructions and materials necessary to enable such Holders to tender their Offered Debt Securities to the Company. The Senior Subordinated Indenture will also provide that: (a) In the event of a Change of Control Offer, the Company will only be required to accept Offered Debt Securities in denominations of $1,000 or integral multiples thereof. 12 15 (b) The Company will not, and will not permit any Restricted Subsidiary to, create or permit to exist or become effective any restriction (other than any restriction set forth in any agreement, indenture, document or instrument relating to any Existing Indebtedness or Refinancing Indebtedness with respect thereto) that would materially impair the ability of the Company to make a Change of Control Offer. Notwithstanding the foregoing, if a Change of Control Offer is made, the Company will pay for Offered Debt Securities tendered for purchase in accordance with the provisions of the Senior Subordinated Indenture described under the caption "--Change of Control." (c) Not later than one Business Day prior to the Change of Control Payment Date in connection with which the Change of Control Offer is being made, the Company will (i) accept for payment Offered Debt Securities or portions thereof tendered pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent money sufficient, in immediately available funds, to pay the purchase price of all Offered Debt Securities or portions thereof so accepted and (iii) deliver to the Paying Agent an Officers' Certificate identifying the Offered Debt Securities or portions thereof accepted for payment by the Company. The Paying Agent will promptly authenticate and mail or deliver to Holders of Offered Debt Securities so accepted payment in an amount equal to the Change of Control Price of the Offered Debt Securities purchased from each such Holder, and the Company will execute and, upon receipt of an Officer's Certificate of the Company, the Trustee will promptly authenticate and mail or deliver to such Holder a new Offered Debt Security equal in principal amount to any unpurchased portion of the Offered Debt Security surrendered. Any Offered Debt Securities not so accepted will be promptly mailed or delivered by the Paying Agent at the Company's expense to the Holder thereof. The Company will publicly announce the results of the Change of Control Offer on the Change of Control Payment Date. For purposes of the provisions of the Senior Subordinated Indenture described above, the Company will choose a Paying Agent which will not be the Company or a Subsidiary thereof. Any excess cash held by the Trustee after the expiration of the Change of Control Offer will be returned to the Company. (d) Any Change of Control Offer will be conducted by the Company in compliance with applicable law, including, without limitation, Section 14(e) of the Exchange Act and Rule 14e-1 thereunder, if applicable. There can be no assurance that sufficient funds will be available at the time of a Change of Control to make any required repurchases. The Company's failure to make any required repurchases in the event of a Change of Control Offer will create an Event of Default under the Senior Subordinated Indenture. No quantitative or other established meaning has been given to the phrase "all or substantially all" (which appears in the definition of Change of Control) by courts which have interpreted this phrase in various contexts. In interpreting this phrase, courts make a subjective determination as to the portion of assets conveyed, considering such factors as the value of the assets conveyed and the proportion of an entity's income derived from the assets conveyed. Accordingly, there may be uncertainty as to whether a Holder of Offered Debt Securities can determine whether a Change of Control has occurred and exercise any remedies such Holder may have upon a Change of Control. Limitations on Transactions with Affiliates. The Senior Subordinated Indenture will provide that the Company will not, and will not permit any of its Restricted Subsidiaries to, make any loan, advance, guaranty or capital contribution to or for the benefit of, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or for the benefit of, or purchase or lease any property or assets from, or enter into or amend any contract, agreement or understanding with, or for the benefit of, (i) any Affiliate of the Company or any Affiliate of the Company's Restricted Subsidiaries or (ii) any Person (or any Affiliate of such Person) holding 10 percent or more of the Common Equity of the Company or any of its Restricted Subsidiaries (each an "Affiliate Transaction"), except on terms that are no less favorable to the Company or the relevant Restricted Subsidiary, as the case may be, than those that could have been obtained in a comparable transaction on an arms' length basis from a Person that is not an Affiliate. 13 16 The Senior Subordinated Indenture will also provide that the Company will not, and will not permit any of its Restricted Subsidiaries to, enter into an Affiliate Transaction involving or having a value of more than $10,000,000, unless in each case such Affiliate Transaction has been approved by a majority of the disinterested members of the Company's Board of Directors. The Senior Subordinated Indenture will also provide that the Company will not, and will not permit any of its Restricted Subsidiaries to, enter into any Affiliate Transaction involving or having a value of more than $20,000,000 unless the Company has delivered to the Trustee an opinion of an Independent Financial Advisor to the effect that the transaction is fair to the Company or the relevant Restricted Subsidiary, as the case may be, from a financial point of view. The Senior Subordinated Indenture will also provide that, notwithstanding the foregoing, an Affiliate Transaction will not include (i) any contract, agreement or understanding with, or for the benefit of, or plan for the benefit of, employees or directors of the Company or its Subsidiaries (in their capacity as such) that has been approved by the Company's Board of Directors, (ii) Capital Stock issuances to members of the Board of Directors, officers or employees of the Company or its Subsidiaries pursuant to plans approved by the Company's Board of Directors, (iii) any Restricted Payment otherwise permitted under the provisions of the Senior Subordinated Indenture described under the caption "--Limitations on Restricted Payments", (iv) any transaction between the Company or a Restricted Subsidiary and another Restricted Subsidiary, (v) any contract, agreement or understanding as in effect on the Issue Date or any amendment thereto or any transaction contemplated thereby (including any amendment thereto) or (vi) loans or advances by the Company or any Restricted Subsidiary to Unrestricted Subsidiaries which in an aggregate amount at any one time outstanding do not exceed $50,000,000. Limitations on Restrictions on Distributions from Restricted Subsidiaries. The Senior Subordinated Indenture will provide that the Company will not, and will not permit any of its Restricted Subsidiaries to, create, assume or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction (other than encumbrances or restrictions imposed by law or by judicial or regulatory action or by provisions in leases or other agreements that restrict the assignability thereof) on the ability of any Restricted Subsidiary to (i) pay dividends or make any other distributions on its Capital Stock or any other interest or participation in, or measured by, its profits, owned by the Company or any of its other Restricted Subsidiaries, or pay interest on or principal of any Indebtedness owed to the Company or any of its other Restricted Subsidiaries, (ii) make loans or advances to the Company or any of its other Restricted Subsidiaries, or (iii) transfer any of its properties or assets to the Company or any of its other Restricted Subsidiaries, except for encumbrances or restrictions existing under or by reason of (a) applicable law, (b) covenants or restrictions contained in Existing Indebtedness as in effect on the Issue Date, (c) any restrictions or encumbrances arising in connection with the Existing Credit Facility; provided that any such restrictions and encumbrances relating to any extension or renewal of the Existing Credit Facility are not more restrictive than those in the Existing Credit Facility being extended or renewed, (d) any restrictions or encumbrances arising in connection with Refinancing Indebtedness; provided that any restrictions and encumbrances of the type described in this clause (d) that arise under such Refinancing Indebtedness are not more restrictive than those under the agreement creating or evidencing the Indebtedness being refunded or refinanced, (e) any agreement restricting the sale or other disposition of property securing Indebtedness permitted by the Senior Subordinated Indenture if such agreement does not expressly restrict the ability of a Subsidiary of the Company to pay dividends or make loans or advances, (f) reasonable and customary borrowing base covenants set forth in credit agreements evidencing Indebtedness otherwise permitted by the Senior Subordinated Indenture which covenants restrict or limit the distribution of revenues or sale proceeds from real estate or a real estate project based upon the amount of Indebtedness outstanding on such real estate or real estate project and the value of some or all of the remaining real estate or the project's remaining assets and (g) any restrictions under any instrument creating or evidencing any Acquisition Debt that was permitted to be Incurred pursuant to the Senior Subordinated Indenture and the Offered Debt Securities and which (1) only apply to assets that were subject to such restrictions and encumbrances prior to the acquisition of such assets by the Company or any of its Restricted Subsidiaries and (2) were not created in connection with, or in contemplation of, such acquisition, and any restrictions replacing those permitted by this clause (g) which are not more restrictive than, and do not extend to any Persons or assets other than the Persons or assets subject to, the restrictions and encumbrances so replaced. 14 17 Maintenance of Consolidated Tangible Net Worth. The Senior Subordinated Indenture will provide that in the event that the Consolidated Tangible Net Worth of the Company for any two consecutive fiscal quarters is less than $115,000,000, within 30 days after the end of each such period the Company will so notify the Trustee in writing by delivery of an Officers' Certificate and will offer to purchase from all Holders (a "Net Worth Offer"), and will purchase from Holders accepting such Net Worth Offer on the date fixed for the closing of such Net Worth Offer (the "Net Worth Offer Date"), ten percent of the original Outstanding principal amount of the Offered Debt Securities (the "Net Worth Amount") at an offer price (the "Net Worth Offer Price") in cash in an amount equal to 100 percent of the principal amount thereof plus accrued and unpaid interest, if any, to the Net Worth Offer Date, in accordance with the procedures set forth in the "Maintenance of Consolidated Tangible Net Worth" covenant of the Senior Subordinated Indenture. To the extent that the aggregate amount of Offered Debt Securities tendered pursuant to a Net Worth Offer is less than the Net Worth Amount relating thereto, then the Company may use the excess of the Net Worth Amount over the amount of Offered Debt Securities tendered, or a portion thereof, for general corporate purposes. The Senior Subordinated Indenture will also provide that in the event that the Consolidated Tangible Net Worth of the Company for any two consecutive fiscal quarters is less than $115,000,000, within 30 days after the end of such period, the Company (with written notice to the Trustee) or the Trustee at the Company's request (and at the expense of the Company) will send or cause to be sent by first-class mail, postage prepaid, to all Holders on the date of the end of the second such consecutive fiscal quarter, at their respective addresses appearing in the Security Register, a notice, prepared by the Company advising such Holders of such occurrence and of each Holder's rights arising as a result thereof. Such notice will contain all instructions and materials necessary to enable Holders to tender their Offered Debt Securities to the Company. The Senior Subordinated Indenture will also provide that: (a) In the event that the aggregate principal amount of Offered Debt Securities surrendered by Holders exceeds the Net Worth Amount, the Company will select the Offered Debt Securities to be purchased on a pro rata basis from all Offered Debt Securities so surrendered, with such adjustments as may be deemed appropriate by the Company so that only Offered Debt Securities in denominations of $1,000, or integral multiples thereof, will be purchased. To the extent that the Net Worth Amount remaining is less than $1,000, the Company may use such Net Worth Amount for general corporate purposes. Holders whose Offered Debt Securities are purchased only in part will be issued new Offered Debt Securities equal in principal amount to the unpurchased portion of the Offered Debt Securities surrendered. (b) The Company will not, and will not permit any Restricted Subsidiary to, create or permit to exist or become effective any restriction (other than any restriction set forth in any agreement, indenture, document or instrument relating to any Existing Indebtedness or Refinancing Indebtedness with respect thereto) that would materially impair the ability of the Company to make a Net Worth Offer. Notwithstanding the foregoing, if a Net Worth Offer is made, the Company will pay for Offered Debt Securities tendered for purchase in accordance with the provisions of the Senior Subordinated Indenture described under the caption "--Maintenance of Consolidated Tangible Net Worth." (c) Not later than one Business Day prior to the Net Worth Offer Date in connection with which the Net Worth Offer is being made, the Company will (i) accept for payment Offered Debt Securities or portions thereof tendered pursuant to the Net Worth Offer (on a pro rata basis if required pursuant to the provisions of the Senior Subordinated Indenture described in paragraph (a) above), (ii) deposit with the Paying Agent money sufficient, in immediately available funds, to pay the purchase price of all Offered Debt Securities or portions thereof so accepted and (iii) deliver to the Paying Agent with an Officers' Certificate identifying the Offered Debt Securities or portions thereof accepted for payment by the Company. The Paying Agent will promptly after acceptance mail or deliver to Holders of Offered Debt Securities so accepted payment in an amount equal to the Net Worth Offer Price of the Offered Debt Securities purchased from each such Holder, and the Company will execute and the Trustee will promptly authenticate and mail or deliver to such Holder a new Offered Debt Security equal in 15 18 principal amount to any unpurchased portion of the Offered Debt Security surrendered. Any Offered Debt Securities not so accepted will be promptly mailed or delivered by the Paying Agent at the Company's expense to the Holder thereof. The Company will publicly announce the results of the Net Worth Offer on the Net Worth Offer Date. For purposes of the provisions of the Senior Subordinated Indenture described above, the Company will choose a Paying Agent which will not be the Company or a Subsidiary thereof. Any excess cash held by the Trustee after the expiration of the Net Worth Offer will be returned to the Company. (d) Any Net Worth Offer will be conducted by the Company in compliance with applicable law, including, without limitation, Section 14(e) of the Exchange Act and Rule 14e-1 thereunder, if applicable. There can be no assurance that sufficient funds will be available at the time of a Net Worth Offer to make any required repurchases. The Company's failure to make any required repurchases in the event of a Net Worth Offer will create an Event of Default under the Senior Subordinated Indenture. Limitations on Mergers and Consolidations. The Senior Subordinated Indenture will provide that the Company will not consolidate or merge with or into, or sell, lease, convey or otherwise dispose of all or substantially all of its assets (including, without limitation, by way of liquidation or dissolution), or assign any of its obligations thereunder or under the Offered Debt Securities (as an entirety or substantially an entirety in one transaction or series of related transactions), to any Person unless: (i) the Person formed by or surviving such consolidation or merger (if other than the Company), or to which sale, lease, conveyance or other disposition or assignment will be made (collectively, the "Successor"), is a solvent corporation or other legal entity organized and existing under the laws of the United States or any state thereof or the District of Columbia, and the Successor assumes by supplemental indenture in a form reasonably satisfactory to the Trustee all of the obligations of the Company under the Offered Debt Securities and the Senior Subordinated Indenture, (ii) immediately after giving effect to such transaction, no Default or Event of Default has occurred and is continuing, (iii) immediately after giving effect to such transaction and the use of any net proceeds therefrom on a pro forma basis, the Consolidated Tangible Net Worth of the Company or the Successor, as the case may be, would be at least equal to the Consolidated Tangible Net Worth of the Company immediately prior to such transaction and (iv) the ratio of the Company's Indebtedness (excluding Non-Recourse Indebtedness) to Consolidated Tangible Net Worth set forth in the Senior Subordinated Indenture and described under the caption "--Limitations on Additional Indebtedness" of the Company or the Successor, as the case may be, immediately after giving effect to such transaction, would be such that the Company or the Successor, as the case may be, would be entitled to Incur at least $1 of additional Indebtedness under such ratio. However, any such consolidation, merger, sale, lease, conveyance or disposition may result in a Change of Control, thereby requiring the Company to make a Change of Control Offer. See "-- Change of Control." No quantitative or other established meaning has been given to the phrase "all or substantially all" by courts which have interpreted this phrase in various contexts. In interpreting this phrase, courts make a subjective determination as to the portion of assets conveyed, considering such factors as the value of the assets conveyed and the proportion of an entity's income derived from the assets conveyed. Accordingly, there may be uncertainty as to whether a Holder of Offered Debt Securities can determine whether the Company has sold, leased, conveyed or otherwise disposed of all or substantially all of its assets and exercise any remedies such Holder may have upon the occurrence of any such transaction. For purposes solely of this "Senior Subordinated Indenture Covenants" section of this Prospectus, the terms set forth below shall have the following meanings: "Acquisition Debt" means Indebtedness of any Person existing at the time such Person became a Subsidiary of the Company (or such Person is merged into the Company or one of the Company's Subsidiaries) or assumed in connection with the acquisition of assets from any such Person (other than assets acquired in the ordinary course of business of the Company and its Subsidiaries), including, without limitation, Indebtedness Incurred in connection with, or in contemplation of, such Person becoming a Subsidiary of the Company (but 16 19 excluding Indebtedness of such Person which is extinguished, retired or repaid in connection with such Person becoming a Subsidiary of the Company). "Affiliate" of any Person means any Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, such Person. For purposes of the Senior Subordinated Indenture, each executive officer and director of the Company and each Restricted Subsidiary will be an Affiliate of the Company. In addition, for purposes of the Senior Subordinated Indenture, control of a 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. Notwithstanding the foregoing, the term "Affiliate" will not include, with respect to the Company or any Restricted Subsidiary which is a Wholly Owned Subsidiary of the Company, any Restricted Subsidiary which is a Wholly Owned Subsidiary of the Company. "Board of Directors" means the board of directors of a Person or any authorized committee of the board of directors of such Person. "Board Resolution" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company 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 a Legal Holiday. "Capital Stock" of any Person means any and all shares, rights to purchase, warrants or options (whether or not currently exercisable), participations, or other equivalents of or interests in (however designated) the equity (which includes, but is not limited to, common stock, preferred stock and partnership and joint venture interests) of such Person (excluding any debt securities that are convertible into, or exchangeable for, such equity). "Capitalized Lease Obligations" of any Person means any obligation of such Person to pay rent or other amounts under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP, and the amount of such obligation will be the capitalized amount thereof determined in accordance with GAAP. "Change of Control" means any of the following: (i) the sale, lease, conveyance or other disposition of all or substantially all of the Company's assets as an entirety or substantially as an entirety to any Person or group of Persons (within the meaning of Section 13(d)(3) of the Exchange Act) in one or a series of transactions; provided that a transaction where the holders of all classes of Common Equity of the Company immediately prior to such transaction own, directly or indirectly, 50 percent or more of the aggregate voting power of all classes of Common Equity of such Person or group immediately after such transaction will not be a Change of Control, (ii) the acquisition by the Company and/or any of its Subsidiaries of 50 percent or more of the aggregate voting power of all classes of Common Equity of the Company in one transaction or a series of related transactions, (iii) the liquidation or dissolution of the Company; provided that a liquidation or dissolution of the Company which is part of a transaction or series of related transactions that does not constitute a Change of Control under the "provided" clause of clause (i) above will not constitute a Change of Control under this clause (iii) or (iv) any transaction or a series of related transactions (as a result of a tender offer, merger, consolidation or otherwise) that results in, or that is in connection with, (a) any Person, including, a "group" (within the meaning of Section 13(d)(3) of the Exchange Act) acquiring beneficial ownership (as determined in accordance with Rule 13d-3 under the Exchange Act), directly or indirectly, of 50 percent or more of the aggregate voting power of all classes of Common Equity of the Company or of any Person that possesses beneficial ownership (as determined in accordance with Rule 13d-3 under the Exchange Act), directly or indirectly, of 50 percent or more of the aggregate voting power of all classes of Common Equity of the Company or (b) less than 50 percent (measured by the aggregate voting power of all classes) of the Common Equity of the Company being registered under Section 12(b) or 12(g) of the Exchange Act. "Common Equity" of any Person means all Capital Stock of such Person that is generally entitled (i) to vote in the election of directors of such Person, or (ii) if such Person is not a corporation, to vote or otherwise 17 20 participate in the selection of the governing body, partners, managers or others that will control the management and policies of such Person. "Consolidated Net Income" of the Company for any period means the aggregate net income (or loss) of the Company and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP; provided that there will be excluded from such net income (to the extent otherwise included therein), without duplication: (i) the net income (or loss) of any Person (other than a Restricted Subsidiary) in which any Person (including, without limitation, an Unrestricted Subsidiary) other than the Company has an ownership interest, except to the extent that any such income has actually been received by the Company or any Restricted Subsidiary in the form of dividends or similar distributions during such period, (ii) except to the extent includable in the Consolidated Net Income pursuant to the foregoing clause (i), the net income (or loss) of any Person that accrued prior to the date that (a) such Person becomes a Restricted Subsidiary or is merged into or consolidated with the Company or any of its Restricted Subsidiaries or (b) the assets of such Person are acquired by the Company or any of its Restricted Subsidiaries, (iii) the net income of any Restricted Subsidiary to the extent that (but only so long as) the declaration or payment of dividends or similar distributions by such Restricted Subsidiary of that income is not permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary during such period, (iv) in the case of a successor to the Company by consolidation, merger or transfer of its assets, any earnings of the successor prior to such merger, consolidation or transfer of assets and (v) the gains (but not losses) resulting from (a) the acquisition of securities issued by the Company or extinguishment of Indebtedness of the Company, (b) the sale or other disposition (including, without limitation, dispositions pursuant to sale and leaseback transactions) of any asset of the Company which is not sold or disposed of in the ordinary course of business and (c) other extraordinary items. Notwithstanding the foregoing, in calculating Consolidated Net Income, the Company will be entitled to take into consideration the tax benefits associated with any extraordinary loss, but only to the extent such tax benefits are recognized by the Company. Consolidated Net Income will exclude any noncash losses, whether or not extraordinary, incurred in connection with the issuance of Capital Stock (other than Disqualified Stock) in exchange for Indebtedness of the Company or its Wholly Owned Restricted Subsidiaries. "Consolidated Tangible Net Worth" of the Company as of any date means the stockholders' equity (including any Preferred Stock that is classified as equity under GAAP, other than Disqualified Stock) of the Company and its Restricted Subsidiaries on a consolidated basis at the end of the fiscal quarter immediately preceding such date, as determined in accordance with GAAP, less the amount of Intangible Assets reflected on the consolidated balance sheet of the Company and its Restricted Subsidiaries as of the end of the fiscal quarter immediately preceding such date. "Default" means any event, act or condition that is, or after notice or the passage of time or both would be, an Event of Default. "Defeasance" has the meaning set forth in Section 11.02 of the Senior Subordinated Indenture. "Disqualified Stock" means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in whole or in part, on or prior to the final Maturity date of the Offered Debt Securities; provided that any Capital Stock which would not constitute Disqualified Stock but for provisions thereof giving holders thereof the right to require the Company to repurchase or redeem such Capital Stock upon the occurrence of a change of control occurring prior to the final Maturity of the Offered Debt Securities will not constitute Disqualified Stock if the change of control provisions applicable to such Capital Stock are no more favorable to the holders of such Capital Stock than the provisions of the Senior Subordinated Indenture described under the caption "Change of Control" and such Capital Stock specifically provides that the Company will not repurchase or redeem (or be required to repurchase or redeem) any such Capital Stock pursuant to such provisions prior to the Company's repurchase of Offered Debt Securities pursuant to the "Change of Control" covenant set forth in the Senior Subordinated Indenture. 18 21 "Event of Default" has the meaning set forth under the caption "-- Events of Default." "Existing Credit Facility" means the Amended and Restated Credit Agreement, dated as of May 28, 1997, between the Company and the lenders named therein and The First National Bank of Chicago, as Agent (together with the documents related thereto (including, without limitation, any guaranty agreements)), as such Facility may be amended, restated, supplemented or otherwise modified from time to time, and includes any facility extending the maturity of, increasing the total commitment of, or restructuring (including, without limitation, the inclusion of additional borrowers thereunder that are Subsidiaries of the Company and whose obligations thereunder are guaranteed by the Company) all or any portion of, the Indebtedness under such Facility or any successor or replacement facilities and includes any facility with one or more agents or lenders refinancing or replacing all or any portion of the Indebtedness under such Facility or any successor facilities. "Existing Indebtedness" means all of the Indebtedness of the Company and its Subsidiaries that is outstanding on the Issue Date. "Fair Market Value" with respect to any asset or property means the sale value that would be obtained in an arm's-length transaction between an informed and willing seller under no compulsion to sell and an informed and willing buyer under no compulsion to buy. "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States, as in effect on the Issue Date. "Hedging Obligations" of any Person means the obligations of such Person pursuant to any interest rate swap agreement, foreign currency exchange agreement, interest rate collar agreement, option or futures contract or other similar agreement or arrangement relating to interest rates or foreign exchange rates. "Holder" means a Person in whose name an Offered Debt Security is registered. "Incur" means to, directly or indirectly, create, incur, assume, guaranty, extend the maturity of, or otherwise become liable with respect to any Indebtedness. "Indebtedness" of any Person at any date means, without duplication, (i) all indebtedness of such Person for borrowed money (whether or not the recourse of the lender is to the whole of the assets of such Person or only to a portion thereof), (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person in respect of letters of credit or other similar instruments (or reimbursement obligations with respect thereto), other than standby letters of credit issued for the benefit of, or surety and performance bonds issued by, such Person in the ordinary course of business, (iv) all obligations of such Person with respect to Hedging Obligations (other than those that fix or cap the interest rate on variable rate indebtedness otherwise permitted by the Senior Subordinated Indenture or that fix the exchange rate in connection with indebtedness denominated in a foreign currency and otherwise permitted by the Senior Subordinated Indenture and other than the purchase of mortgage commitments in the ordinary course of business), (v) all obligations of such Person to pay the deferred and unpaid purchase price of property or services, including, without limitation, all conditional sale obligations of such Person and all obligations under any title retention agreement (except trade payables and accrued expenses incurred in the ordinary course of business), (vi) all Capitalized Lease Obligations of such Person, (vii) all indebtedness of others secured by a Lien on any asset of such Person, whether 19 22 or not such indebtedness is assumed by such Person, (viii) all indebtedness of others guaranteed by, or otherwise the liability of, such Person to the extent of such guaranty or liability, and (ix) all Disqualified Stock issued by such Person (the amount of indebtedness represented by any Disqualified Stock will equal the greater of the voluntary or involuntary liquidation preference plus accrued and unpaid dividends). The amount of indebtedness of any Person at any date will be (a) the outstanding balance at such date of all unconditional obligations as described above, (b) the maximum liability of such Person for any contingent obligations under clause (v) above and (c) in the case of clause (vii) (if the indebtedness referred to therein is not assumed by such Person), the lesser of the (A) Fair Market Value of all assets subject to a Lien securing the indebtedness of others on the date that the Lien attaches and (B) amount of the indebtedness secured. "Independent Financial Advisor" means an accounting, appraisal or investment banking firm of nationally recognized standing that is, in the reasonable judgment of the Company's Board of Directors, (i) qualified to perform the task for which it has been engaged, and (ii) disinterested and independent with respect to the Company, all of its Subsidiaries, and each Affiliate of the Company and/or its Subsidiaries that is involved in the Affiliate Transaction with respect to which such firm has been engaged. "Intangible Assets" of the Company means all unamortized debt discount and expense, unamortized deferred charges, goodwill, patents, trademarks, service marks, trade names, copyrights, write-ups of assets over their carrying value at the end of the last fiscal quarter ended prior to the Issue Date or the date of acquisition, if acquired subsequent thereto, and all other items which would be treated as intangibles on the consolidated balance sheet of the Company and its Restricted Subsidiaries prepared in accordance with GAAP. "Investments" of any Person means all (i) investments by such Person in any other Person in the form of loans, advances or capital contributions, (ii) guarantees of Indebtedness or other obligations of any other Person by such Person, (iii) purchases (or other acquisitions for consideration) by such Person of Indebtedness, Capital Stock or other securities of any other Person and (iv) other items that would be classified as investments (including, without limitation, purchases of assets outside the ordinary course of business) on a balance sheet of such Person determined in accordance with GAAP. "Issue Date" means the date of original issuance of the Offered Debt Securities. "Legal Holiday" means Saturday, Sunday or a day on which banking institutions in New York, New York or at a Place of Payment are authorized or obligated by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday at a Place of Payment, payment shall be made at that place on the next succeeding day that is not a Legal Holiday and no interest shall accrue for the intervening period. "Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or other similar encumbrance of any kind upon or in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law (including, without limitation, any conditional sale or other title retention agreement, and any lease in the nature thereof, any option or other agreement to sell, and any filing of, or agreement to give, any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction). "Maturity", when used with respect to an Offered Debt Security, means the date on which the principal of such Offered Debt Security or an installment of principal becomes due and payable as therein provided or provided in the Senior Subordinated Indenture, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise. "Non-Recourse Indebtedness" means Indebtedness of the Company or a Restricted Subsidiary for which (i) the sole legal recourse for collection of principal and interest on such Indebtedness is against the specific property identified in the instruments evidencing or securing such Indebtedness and such property was acquired with the proceeds of such Indebtedness or such Indebtedness was Incurred within 90 days after the acquisition of such property and (ii) no other assets of the Company or such Restricted Subsidiary may be realized upon in collection of principal or interest on such Indebtedness. 20 23 "Officer" means the Chairman of the Board, the President, the Senior Vice President, the Treasurer, any Assistant Treasurer, the Controller, the Secretary, any Assistant Secretary or any Vice President of a Person. "Officers' Certificate" means a certificate signed by two Officers, one of whom must be the Person's Chief Executive Officer (or Co-Chief Executive Officer), Chief Operating Officer, Chief Financial Officer or Chief Accounting Officer. "Outstanding", when used with respect to Offered Debt Securities, means, as of the date of determination, all Offered Debt Securities theretofore authenticated and delivered under the Senior Subordinated Indenture, except: (i) Offered Debt Securities theretofore canceled by the Trustee or delivered to the Trustee for cancellation; (ii) Offered Debt 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 Offered Debt Securities; provided that, if such Offered Debt Securities are to be redeemed, notice of such redemption has been duly given pursuant to the Senior Subordinated Indenture or provision therefor satisfactory to the Trustee has been made; (iii) Offered Debt Securities as to which the Defeasance has been effected pursuant to the defeasance provisions, if any, of the Senior Subordinated Indenture; and (iv) Offered Debt Securities which have been paid pursuant to the "Mutilated, Destroyed, Lost and Stolen Securities" section of the Senior Subordinated Indenture or in exchange for or in lieu of which other Offered Debt Securities have been authenticated and delivered pursuant to the Senior Subordinated Indenture, other than any such Offered Debt Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Offered Debt Securities are held by a bona fide purchaser in whose hands such Offered Debt Securities are valid obligations of the Company; provided, however, that in determining whether the Holders of the requisite principal amount of the Outstanding Offered Debt Securities have given any request, demand, authorization, direction, notice, consent or waiver under the Senior Subordinated Indenture, (a) the principal amount of an Offered Debt Security denominated in one or more foreign currencies or currency units shall be the U.S. dollar equivalent, determined in the manner provided as contemplated by Section 3.01 of the Senior Subordinated Indenture on the Issue Date, of the principal amount of such Offered Debt Security, and (b) Offered Debt Securities owned by the Company or any other obligor of the Offered Debt Securities or any Subsidiary 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 relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Offered Debt Securities which the Trustee knows to be so owned shall be so disregarded. Offered Debt 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 Offered Debt Securities and that the pledgee is not the Company or any other obligor upon the Offered Debt Securities or any Subsidiary of the Company or of such other obligor. "Paying Agent" means any Person, including the Company, authorized by the Company to pay the principal of or any interest on any Offered Debt Security. "Permitted Investment" of any Person means any Investment of such Person in (i) direct obligations of the United States or any agency thereof or obligations guaranteed by the United States or any agency thereof, in each case maturing within 180 days of the date of acquisition thereof, (ii) certificates of deposit maturing within 180 days of the date of acquisition thereof issued by a bank, trust company or savings and loan association which is organized under the laws of the United States or any state thereof having capital, surplus and undivided profits aggregating in excess of $250 million and a Keefe Bank Watch Rating of C or better (or a similar rating by any 21 24 successor thereof), (iii) certificates of deposit maturing within 180 days of the date of acquisition thereof issued by a bank, trust company or savings and loan association organized under the laws of the United States or any state thereof other than banks, trust companies or savings and loan associations satisfying the criteria in (ii) above; provided that the aggregate amount of all certificates of deposit issued to the Company at any one time by such bank, trust company or savings and loan association will not exceed $100,000, (iv) commercial paper given the highest rating by two established national credit rating agencies and maturing not more than 180 days from the date of the acquisition thereof, (v) repurchase agreements or money-market accounts which are fully secured by direct obligations of the United States or any agency thereof and (vi) in the case of the Company and its Subsidiaries, any receivables or loans taken by the Company or a Subsidiary in connection with the sale of any asset otherwise permitted by the Senior Subordinated Indenture. "Person" means any individual, corporation, partnership, joint venture, limited liability company, incorporated or unincorporated association, joint stock company, trust, unincorporated organization or government or other agency or political subdivision thereof or other entity of any kind. "Place of Payment", when used with respect to the Offered Debt Securities, means the place or places where the principal of and interest on the Offered Debt Securities are payable. "Preferred Stock" of any Person means all Capital Stock of such Person which has a preference in liquidation or with respect to the payment of dividends. "Refinancing Indebtedness" means Indebtedness that refunds, refinances or extends any Existing Indebtedness or other Indebtedness permitted to be Incurred by the Company or its Restricted Subsidiaries pursuant to the terms of the Senior Subordinated Indenture, but only to the extent that (i) the Refinancing Indebtedness is subordinated to the Offered Debt Securities to the same extent as the Indebtedness being refunded, refinanced or extended, if at all, (ii) the Refinancing Indebtedness is scheduled to mature either (a) no earlier than the Indebtedness being refunded, refinanced or extended, or (b) after the maturity date of the Offered Debt Securities, (iii) the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or prior to the Maturity date of the Offered Debt Securities has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is Incurred that is equal to or greater than the Weighted Average Life to Maturity of the portion of the Indebtedness being refunded, refinanced or extended that is scheduled to mature on or prior to the Maturity date of the Offered Debt Securities, (iv) such Refinancing Indebtedness is in an aggregate amount that is equal to or less than the aggregate amount then outstanding under the Indebtedness being refunded, refinanced or extended, (v) such Refinancing Indebtedness is Incurred by the same Person that initially Incurred the Indebtedness being refunded, refinanced or extended, except that the Company may Incur Refinancing Indebtedness to refund, refinance or extend Indebtedness of any Restricted Subsidiary, and (vi) such Refinancing Indebtedness is Incurred within 180 days before or after the Indebtedness being refunded, refinanced or extended is so refunded, refinanced or extended; provided that Refinancing Indebtedness shall include the amount of any Indebtedness under the Existing Credit Facility which is Incurred within 180 days before or after the repayment of an equal amount of Indebtedness under the Existing Credit Facility which was Incurred pursuant to the provisions of the Senior Subordinated Indenture described in the first paragraph under the caption "-- Limitations on Additional Indebtedness." "Registrar" has the meaning set forth in the "Registration, Registration of Transfer and Exchange" section of the Senior Subordinated Indenture. "Restricted Investment" with respect to any Person means any Investment (other than any Permitted Investment) by such Person in any (i) of its Affiliates, (ii) executive officer or director of any Affiliate of such Person, or (iii) other Person other than a Restricted Subsidiary which is a Wholly Owned Subsidiary of the referent Person; provided, however, that with respect to the Company and its Restricted Subsidiaries, any loan or advance to an executive officer or director of the Company or a Subsidiary will not constitute a Restricted Investment provided such loan or advance is made in the ordinary course of business consistent with past practices, and, if such loan or advance exceeds $100,000 (other than a readily marketable mortgage loan not exceeding $500,000), 22 25 such loan or advance has been approved by the Board of Directors of the Company or a disinterested committee thereof. "Restricted Payment" with respect to any Person means (i) the declaration of any dividend or the making of any other payment or distribution of cash, securities or other property or assets in respect of such Person's Capital Stock (except that a dividend payable solely in Capital Stock (other than Disqualified Stock) of such Person will not constitute a Restricted Payment), (ii) any payment on account of the purchase, redemption, retirement or other acquisition for value of such Person's Capital Stock or any other payment or distribution made in respect thereof (other than payments or distributions excluded from the definitions of Restricted Payment in clause (i) above), either directly or indirectly, (iii) any Restricted Investment, and (iv) any principal payment, redemption, repurchase, defeasance or other acquisition or retirement of any Indebtedness of any Unrestricted Subsidiary or of Indebtedness of the Company or its Restricted Subsidiaries which is subordinated in right of payment to the Offered Debt Securities (provided, however, that the payment, redemption, repurchase, defeasance or other acquisition or retirement of any such subordinated Indebtedness by the Company or any Restricted Subsidiary on its scheduled final maturity date or on any other scheduled date for the payment thereof (whether pursuant to a sinking fund, mandatory redemption or otherwise) shall not be a Restricted Payment); provided, further, that with respect to the Company and its Subsidiaries, Restricted Payments will not include (a) any payment or other obligation described in clause (i), (ii) or (iii) above made to, or on behalf of or for the benefit of, the Company or any of its Restricted Subsidiaries which are Wholly Owned Subsidiaries by any of the Company's Subsidiaries, or (b) any proportionate payment in respect of minority interests in Restricted Subsidiaries of the Company to the extent that the payment constitutes a return of capital that was not included in the Company's shareholders' equity or a dividend or similar distribution not included in determining the Company's Consolidated Net Income, or (c) any principal payment, redemption, repurchase, defeasance or other acquisition or retirement of Indebtedness of the Company or its Restricted Subsidiaries which is subordinated to the Offered Debt Securities if the consideration therefor consists solely of, or is the proceeds from, Indebtedness subordinated to the Offered Debt Securities to the same extent as the Indebtedness being paid, redeemed, repurchased, defeased or otherwise acquired or retired, or (d) any principal payment, redemption, repurchase, defeasance or other acquisition or retirement of Indebtedness or Capital Stock of such Person or its Subsidiaries if the consideration therefor consists solely of Capital Stock (other than Disqualified Stock) of such Person, or the proceeds from such sale of such Capital Stock or (e) any loans or advances by the Company or any Restricted Subsidiary to Unrestricted Subsidiaries which in an aggregate amount at any one time outstanding do not exceed $50,000,000. "Restricted Subsidiary" means each of the Subsidiaries of the Company which is not an Unrestricted Subsidiary. "Security Register" has the meaning set forth in the "Registration, Registration of Transfer and Exchange" section of the Senior Subordinated Indenture. "Stated Maturity", when used with respect to any Offered Debt Security or any installment of principal thereof or interest thereon, means the date specified in such Offered Debt Security as the fixed date on which the principal of such Offered Debt Security or such installment of principal or interest is due and payable. "Subsidiary" of any Person means any (i) corporation of which at least a majority of the aggregate voting power of all classes of the Common Equity is directly or indirectly beneficially owned by such Person, and (ii) entity other than a corporation of which such Person directly or indirectly beneficially owns at least a majority of the Common Equity. "Trustee" means the Person named as Trustee in the first paragraph of the Senior Subordinated Indenture until a successor Trustee shall have become such pursuant to the applicable provisions of the Senior Subordinated Indenture, and thereafter "Trustee" shall mean or include each Person who is then a Trustee thereunder. "Unrestricted Subsidiary" means each of the Subsidiaries of the Company so designated by a Board Resolution. The Board of Directors of the Company may designate an Unrestricted Subsidiary to be a Restricted Subsidiary; provided that (i) any such redesignation will be deemed to be an Incurrence by the Company and its Restricted Subsidiaries of the Indebtedness (if any) of such redesignated Subsidiary for purposes of the provisions of the Senior Subordinated Indenture described under the caption "--Limitations on Additional Indebtedness" as of the date of such redesignation and (ii) immediately after giving effect to such redesignation and the Incurrence of any such additional Indebtedness, the Company and its Restricted Subsidiaries could Incur $1.00 of additional 23 26 Indebtedness under the ratio of the Company's Indebtedness (excluding Non-Recourse Indebtedness) to Consolidated Tangible Net Worth set forth in the first paragraph under the caption "--Limitations on Additional Indebtedness." Subject to the foregoing, the Board of Directors of the Company also may designate any Restricted Subsidiary to be an Unrestricted Subsidiary; provided that (i) all previous Investments by the Company and its Restricted Subsidiaries in such Restricted Subsidiary will be deemed to be Restricted Payments at the time of such designation and will reduce the amount available for Restricted Payments under the provisions of the Senior Subordinated Indenture described under the caption "--Limitations on Restricted Payments" and (ii) immediately after giving effect to such designation and reduction of amounts available for Restricted Payments under such provisions, the Company and its Restricted Subsidiaries could Incur $1.00 of additional Indebtedness under the ratio of the Company's Indebtedness (excluding Non-Recourse Indebtedness) to Consolidated Tangible Net Worth set forth in the first paragraph under the caption "--Limitations on Additional Indebtedness." Any such designation or redesignation by the Board of Directors of the Company will be evidenced to the Trustee by the filing with the Trustee of a Board Resolution giving effect to such designation or redesignation and an Officers' Certificate certifying that such designation or redesignation complied with the foregoing conditions and setting forth the underlying calculations of such Officers' Certificate. "Weighted Average Life to Maturity" means, when applied to any Indebtedness or portion thereof, at any date, the number of years obtained by dividing (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal, including, without limitation, payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment by (ii) the then outstanding principal amount of such Indebtedness or portion thereof. "Wholly Owned Subsidiary" of any Person means (i) a Subsidiary, of which 100 percent of the Common Equity (except for directors' qualifying shares or certain minority interests owned by other Persons solely due to local law requirements that there be more than one stockholder, but which interest is not in excess of what is required for such purpose) is owned directly by such Person or through one or more other Wholly Owned Subsidiaries of such Person, or (ii) any entity other than a corporation in which such Person, directly or indirectly, owns all of the Common Equity of such entity. REDEMPTION If and to the extent set forth in the applicable Prospectus Supplement, the Company will have the right to redeem the Offered Debt Securities, in whole or from time to time in part, after the date and at the redemption prices set forth in the applicable Prospectus Supplement. EVENTS OF DEFAULT Except as may be described in the accompanying Prospectus Supplement, an "Event of Default" will be defined in the Indenture for the Offered Debt Securities as any of the following events (whatever the reason for such Event of Default and whether it will be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or any order of any court or any order, rule or regulation of any administrative or governmental body): (i) the failure by the Company to pay interest on any Offered Debt Security when the same becomes due and payable and the continuance of any such failure for a period of 30 days; (ii) the failure by the Company to pay the principal of any Offered Debt Security when the same becomes due and payable at Maturity, upon acceleration or otherwise; (iii) the failure by the Company to make any sinking fund payment when the same becomes due and payable; 24 27 (iv) the failure by the Company to comply with any of its agreements or covenants in, or provisions of, the Offered Debt Security or the Indenture relating to the Offered Debt Security (other than an agreement or covenant a default in whose performance or whose breach is elsewhere in such Indenture specifically dealt with) and such failure continues for the period and after the notice specified below; (v) the acceleration of any indebtedness for borrowed money or guarantees thereof (other than Non-Recourse Indebtedness (as defined in the applicable Indenture)) of the Company or any of its subsidiaries that has an outstanding principal amount of $10,000,000 or more in the aggregate; provided that, in the event any such acceleration is withdrawn or otherwise rescinded within a period of five days after such acceleration by the holders of such indebtedness, any Event of Default under the provisions of the applicable Indenture described in this clause (v) relating to the Offered Debt Securities will be deemed to be cured and any acceleration under such Indenture will be deemed withdrawn or rescinded; (vi) the failure by the Company or any of its subsidiaries to make any principal or interest payment in respect of indebtedness for borrowed money or guarantees thereof (other than Non-Recourse Indebtedness) of the Company or any of its subsidiaries with an outstanding aggregate principal amount of $10,000,000 or more within five days of such principal or interest payment becoming due and payable (after giving effect to any applicable grace period set forth in the documents governing such indebtedness); (vii) a final judgment or judgments that exceed $10,000,000 or more in the aggregate, for the payment of money, having been entered by a court or courts of competent jurisdiction against the Company or any of its subsidiaries and such judgment or judgments are not satisfied, stayed, annulled or rescinded within 60 days of being entered; (viii) the Company or any Material Subsidiary pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case, (B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointment of a Custodian of it or for all or substantially all of its property, or (D) makes a general assignment for the benefit of its creditors; (ix) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief against the Company or any Material Subsidiary as debtor in an involuntary case, (B) appoints a Custodian of the Company or any Material Subsidiary or a Custodian for all or substantially all of the property of the Company or any Material Subsidiary, or (C) orders the liquidation of the Company or any Material Subsidiary, and the order or decree remains unstayed and in effect for 60 days; or (x) any other Event of Default provided in the supplemental indenture under which the Offered Debt Securities are issued or in the form of such Offered Debt Security. For purposes hereof, "Material Subsidiary" means any subsidiary of the Company which accounted for three percent or more of the consolidated tangible net assets or consolidated cash flow available for fixed charges 25 28 of the Company on a consolidated basis for the fiscal year ending immediately prior to any default or Event of Default, all computed in accordance with generally accepted accounting principles. The Indenture relating to the Offered Debt Securities will provide that the Trustee will not be deemed to know of a default unless a trust officer has actual knowledge of such default or receives written notice of such default with specific reference to such default. The Indenture relating to the Offered Debt Securities will provide that a default as described in sub-clause (iv) above is not an Event of Default until the Trustee notifies the Company, or the holders of at least 25 percent in aggregate principal amount of the then outstanding Offered Debt Securities under the Indenture, or such other percentage as may be specified in the applicable Prospectus Supplement, notify the Company and the Trustee, of the default and the Company does not cure the default within 60 days after receipt of the notice, or for such other period as may be specified in the applicable Prospectus Supplement. The notice must specify the default, demand that it be remedied and state that the notice is a "Notice of Default." If such a default is cured within the applicable time period, it ceases. Except to the extent otherwise stated in the applicable Prospectus Supplement, the Indenture for the Offered Debt Securities will provide that if an Event of Default (other than an Event of Default described in sub-clause (viii) or (ix) above) shall have occurred and be continuing under the Indenture, the Trustee (after receiving indemnities from the holders of the Offered Debt Securities to its satisfaction) by notice to the Company, or the holders of at least 25 percent in principal amount of the Offered Debt Securities then outstanding, or such other percentage as may be specified in the Prospectus Supplement, by notice to the Company and the Trustee, may declare all of the Offered Debt Securities to be due and payable immediately. Upon such declaration, the amounts due and payable on the Offered Debt Securities, as determined pursuant to the provisions of the "Acceleration" section of the Indenture, will be due and payable immediately. Except to the extent otherwise stated in the Prospectus Supplement, the Indenture for the Offered Debt Securities will provide that if an Event of Default described in sub-clause (viii) or (ix) above occurs, the Offered Debt Securities will ipso facto become and be immediately due and payable without any declaration, notice or other act on the part of the Trustee and the Company or any holder. The holders of a majority in principal amount of the Offered Debt Securities then outstanding, or such other percentage as may be specified in the applicable Prospectus Supplement, by written notice to the Trustee and the Company, may waive such Event of Default, rescind an acceleration and its consequences (except an acceleration due to nonpayment of principal of or interest on the Offered Debt Securities) if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived. Except to the extent otherwise stated in the applicable Prospectus Supplement, the Indenture for the Offered Debt Securities will contain a provision entitling the Trustee, subject to the duty of the Trustee during a default to act with the required standard of care, to be indemnified by the holders of Offered Debt Securities before proceeding to exercise any right or power under the Indenture at the request of such holders. Subject to such provisions in the Indenture for the Offered Debt Securities for the indemnification of the Trustee and certain other limitations, the holders of a majority in principal amount of the Offered Debt Securities then outstanding, or such other percentage as may be specified in the applicable Prospectus Supplement, may 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. The Trustee may withhold from the holders of the Offered Debt Securities notice of any continuing default or Event of Default (except any default or Event of Default in payment of principal or interest on the Offered Debt Securities) if the Trustee determines that withholding such notice is in the holders' interest. Except to the extent otherwise stated in the applicable Prospectus Supplement, the Indenture for the Offered Debt Securities will provide that no holder of Offered Debt Securities may institute any action against the Company under the Indenture unless (i) such holder previously has given the Trustee written notice of the default and continuance thereof, (ii) the holders of not less than 25 percent in principal amount of the Offered Debt Securities then outstanding, or such other percentage as may be specified in the applicable Prospectus Supplement, have requested the Trustee to institute such action and offered the Trustee reasonable indemnity, (iii) the Trustee has not instituted such action within 60 days of the request and (iv) the Trustee has not received direction 26 29 inconsistent with such written request from the holders of a majority in principal amount of the Offered Debt Securities then outstanding, or such other amount as may be specified in the applicable Prospectus Supplement. Notwithstanding any other provision of the applicable Indenture, the right of any holder of Offered Debt Securities to receive payment of principal and interest on such Offered Debt Security on or after the respective due dates thereof, or, subject to the provisions of the applicable Indenture described in the preceding sentence, to bring suit for the enforcement of any such payment on or after such respective dates, will not be impaired or affected without the consent of such holder. The Indentures and the Offered Debt Securities will provide that no director, officer or employee of the Company, as such, will have any liability for any obligations of the Company under the Offered Debt Securities or the Indentures. The Indentures and the Offered Debt Securities will also each provide that each holder of the Offered Debt Securities, by accepting the Offered Debt Securities, waives and releases all such liability. Except to the extent otherwise stated in the Prospectus Supplement, the Indenture for the Offered Debt Securities will provide that the Company will be required to deliver to the Trustee an annual statement regarding compliance with the Indenture, and include in such statement, if any officer of the Company is aware of any default or Event of Default, a statement specifying such default or Event of Default and what action the Company is taking or proposes to take with respect thereto. In addition, the Company will be required to deliver to the Trustee prompt written notice of the occurrence of any default or Event of Default. DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE Except to the extent otherwise stated in the applicable Prospectus Supplement, the Company may terminate certain of its obligations under the Indenture with respect to the Offered Debt Securities including its obligations to comply with the restrictive covenants described herein or in the applicable Prospectus Supplement, on the terms and subject to the conditions contained in the Indenture, by depositing in trust with the Trustee money or obligations of, or guaranteed by, the United States sufficient to pay the principal and interest, if any, on such Offered Debt Securities to maturity (or earlier redemption). The Prospectus Supplement sets forth the specific provisions, if any, permitting such defeasance or covenant defeasance, including any modifications to the provisions described above, with respect to the Offered Debt Securities. TRANSFER AND EXCHANGE A holder of an Offered Debt Security will be able to transfer or exchange the Offered Debt Securities only in accordance with the provisions of the Indenture. The registrar may require a holder, among other things, to furnish appropriate endorsements and transfer documents, and to pay any taxes and fees required by law or permitted by the Indenture. MODIFICATIONS TO THE INDENTURES Except as may otherwise be set forth in the applicable Prospectus Supplement, the Indenture for the Offered Debt Securities will provide that the Company and the Trustee may enter into supplemental indentures without the consent of the holders of Offered Debt Securities to, among other things: (i) cure any ambiguity, defect or inconsistency in the Indenture for the Offered Debt Securities; (ii) comply with the "Limitations on Mergers and Consolidations" section set forth in the Indenture; (iii) provide for uncertificated Offered Debt Securities in addition to certificated Offered Debt Securities; (iv) make any change that does not adversely affect the legal rights under the Indenture of holders of Offered Debt Securities; (v) add to the covenants of the Company for the benefit of the holders of Offered Debt Securities or to surrender any right or power in the Indenture conferred upon the Company; (vi) add any additional Events of Default for the benefit of the holders of Offered Debt Securities; (vii) change or eliminate any of the provisions of the Indenture before Offered Debt Securities are issued thereunder; (viii) establish the form or terms of the Offered Debt Securities; (ix) evidence and provide for the acceptance of appointment under the Indenture of a successor Trustee with respect to the Offered Debt 27 30 Securities and to add to or change any of the provisions of the Indenture as shall be necessary to provide for or facilitate the administration of the trusts under the Indenture by more than one Trustee; (x) supplement any of the provisions of the Indenture to such extent as shall be necessary to permit or facilitate the defeasance or discharge of Offered Debt Securities pursuant to the Indenture; provided that any such action shall not adversely affect the interests of the holders of Offered Debt Securities; or (xi) comply with the qualification of the Indenture under the TIA. Except as may otherwise be set forth in the applicable Prospectus Supplement, the Indenture for the Offered Debt Securities also will contain provisions permitting the Company and the Trustee, with the consent of the holders of not less than a majority in principal amount of Offered Debt Securities outstanding, or such other percentage as may be specified in the applicable Prospectus Supplement, to add any provision to, change in any manner or eliminate any of the provisions of the Indenture for the Offered Debt Securities or modify in any manner the rights of the holders of the Offered Debt Securities so affected; provided that the Company and the Trustee may not, without the consent of the holder of each outstanding Offered Debt Security affected thereby, do, among other things, any of the following: (i) change the stated maturity of the principal of, or any installment of principal of, or interest on, any Offered Debt Security, or reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or change the place of payment where any Offered Debt Security or interest thereon is payable, or change the coin or currency in which any Offered Debt 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 or repayment at the option of the holder, on or after the redemption date or repayment date); (ii) reduce the percentage in principal amount of the outstanding Offered Debt Securities, the consent of whose holders is required for any such amendment, or the consent of whose holders is required for any waiver of compliance with certain provisions of the Indenture or certain defaults thereunder and their consequences provided for in the Indenture; (iii) modify Section 13.02(d)(iii) or 8.07 of the Indenture; or (iv) modify the ranking or priority of the Offered Debt Securities in a manner adverse to the holders of Offered Debt Securities. The Senior Subordinated Indenture and the Subordinated Indenture may not be amended to alter the subordination of any outstanding Senior Subordinated Debt Securities or Subordinated Debt Securities without the consent of each holder of Senior Indebtedness then outstanding that would be adversely affected thereby. Except as provided in the applicable Prospectus Supplement, the holders of at least a majority in principal amount of the then outstanding Offered Debt Securities may on behalf of the holders of all Offered Debt Securities, or such other amount as may be specified in the applicable Prospectus Supplement, waive (i) insofar as the Offered Debt Securities are concerned, compliance by the Company with certain covenants of the Indenture and (ii) any past default under the Indenture with respect to the Offered Debt Securities, except a default in the payment of the principal of or interest on any Offered Debt Security or in respect of a provision which under the Indenture cannot be modified or amended without the consent of the holder of each outstanding Offered Debt Security affected. CONCERNING THE TRUSTEE IBJ Schroder Bank & Trust Company is to be Trustee under each of the Indentures and has been appointed by the Company as paying agent and registrar. IBJ Schroder Bank & Trust Company is the trustee under the Indenture, dated as of June 21, 1993, relating to the 1993 Senior Notes and the Indenture, dated as of February 16, 1996, relating to the 1996 Senior Notes, and it or any other Trustee, or their respective affiliates, may from time to time have lender or other business arrangements with the Company. The Indenture will contain certain limitations on the rights of the Trustee, should it or its affiliates become a creditor of the Company, to obtain payment of claims in certain cases or to realize on certain property received in respect of any such claim as security or otherwise. The Trustee and its affiliates will be permitted to engage in other transactions; however, if they acquire any conflicting interest, the conflict must be eliminated or the Trustee must resign. GOVERNING LAW Unless otherwise specified in the accompanying Prospectus Supplement, the Indenture for the Offered Debt Securities and the Offered Debt Securities will be governed by the laws of the State of New York. 28 31 PLAN OF DISTRIBUTION The Company may sell the Debt Securities offered hereby (i) through agents, (ii) through underwriters, (iii) through dealers, (iv) directly to purchasers (through a specific bidding or auction process or otherwise) or (v) through a combination of any such methods of sale. The distribution of Debt Securities may be effected from time to time in one or more transactions at a fixed price or prices, which may be changed, or at market prices prevailing at the time of sale, at prices relating to such prevailing market prices or at negotiated prices. Each Prospectus Supplement will set forth the terms of the offering of the particular issuance of Debt Securities to which such Prospectus Supplement relates, including (i) the name or names of any underwriters or agents with whom the Company has entered into arrangements with respect to the sale of such Debt Securities, (ii) the initial public offering or purchase price of such Debt Securities, (iii) any underwriting discounts, commissions and other items constituting underwriters' compensation from the Company and any other discounts, concessions or commissions allowed or reallowed or paid by any underwriters to other dealers, (iv) any commissions paid to any agents, (v) the net proceeds to the Company, and (vi) the securities exchange, if any, on which such Debt Securities will be listed. If an underwriter or underwriters are utilized in the sale of Debt Securities, the Company will execute an underwriting agreement with such underwriter or underwriters at the time an agreement for such sale is reached, and the names of the specific managing underwriter or underwriters, as well as any other underwriters, and the terms of the transactions, including compensation of the underwriters and dealers, if any, will be set forth in the applicable Prospectus Supplement, which will be used by the underwriters to make resales of the Debt Securities. If a dealer is utilized in the sale of Debt Securities, the Company will sell such Debt Securities to the dealer, as principal. The dealer may then resell such Debt Securities to the public at varying prices to be determined by such dealer at the time of resale. The name of the dealer and the terms of the transactions will be set forth in the applicable Prospectus Supplement relating thereto. Offers to purchase the Debt Securities may be solicited directly by the Company and sales thereof may be made by the Company directly to institutional investors or others. The terms of any such sales, including the terms of any bidding or auction process, if utilized, will be described in the applicable Prospectus Supplement. Agents, underwriters and dealers may be entitled under agreements which may be entered into with the Company to indemnification by the Company against certain liabilities, including liabilities under the Securities Act, and any such agents, underwriters or dealers, or their affiliates may be customers of, engage in transactions with or perform services for, the Company in the ordinary course of business. If so indicated in the applicable Prospectus Supplement, the Company will authorize agents, underwriters and other persons to solicit offers by certain institutions to purchase Debt Securities from the Company pursuant to contracts providing for payment and delivery on a future date. Institutions with which such contracts may be made include commercial and savings banks, insurance companies, pension funds, investment companies, educational and charitable institutions and others, but in all cases such institutions must be approved by the Company. The obligations of any purchaser under any such contract will be subject to the condition that the purchase of the Debt Securities shall not at the time of delivery be prohibited under the laws of the jurisdiction to which such purchaser is subject. The underwriters and such other agents will not have any responsibility in respect of the validity or performance of such contracts. The Company may grant underwriters who participate in the distribution of Debt Securities an option to purchase additional Debt Securities to cover over-allotments, if any. The place and date of delivery for Debt Securities in respect of which this Prospectus is being delivered will be set forth in the applicable Prospectus Supplement. 29 32 Unless otherwise indicated in the applicable Prospectus Supplement, the Debt Securities in respect of which this Prospectus is being delivered will be a new issue of securities, will not have an established trading market when issued and will not be listed on any securities exchange. Any underwriters or agents to or through whom such Debt Securities are sold by the Company for public offering and sale may make a market in such Debt Securities, but such underwriters or agents will not be obligated to do so and may discontinue any market making at any time without notice. No assurance can be given as to the liquidity of the trading market for any such Debt Securities. LEGAL MATTERS The legality of the Debt Securities will be passed upon for the Company by Kaye, Scholer, Fierman, Hays & Handler, LLP, New York, New York. Certain legal matters in connection with offerings made by this Prospectus may be passed on for the underwriters, if any, by counsel named in the Prospectus Supplement. EXPERTS The audited financial statements of the Company and subsidiaries incorporated by reference in this Prospectus and elsewhere in the Registration Statement have been audited by Arthur Andersen LLP, independent public accountants, as indicated in their reports with respect thereto, and are so included herein in reliance upon the authority of said firm as experts in giving said reports. 30 33 NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT, AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR BY ANY UNDERWRITER, AGENT OR DEALER. THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT SHALL NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT SHALL NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THEREOF OR THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AT ANY TIME SUBSEQUENT TO THE DATE HEREOF OR THEREOF. TABLE OF CONTENTS
PAGE ---- Available Information 2 Incorporation of Certain Information by Reference 2 The Company 3 Use of Proceeds 3 Consolidated Ratio of Earnings to Fixed Charges 3 Description of Debt Securities 4 Plan of Distribution 30 Legal Matters 31 Experts 31
U.S. HOME CORPORATION $325,000,000 DEBT SECURITIES PROSPECTUS , 199 31 34 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION The estimated expenses in connection with the offering are as follows:
Securities and Exchange Commission Registration Fee................................ $ 90,909.09 Accounting Fees and Expenses....................................................... $ 60,000 (1) Blue Sky Fees and Expenses (including counsel fees)................................ $ 5,000 (1) Legal Fees and Expenses............................................................ $ 150,000 (1) Printing and Engraving Expenses.................................................... $ 50,000 (1) Trustee Fees and Expenses.......................................................... $ 30,000 (1) Rating Agency Fees................................................................. $ 125,000 (1) Miscellaneous...................................................................... $ 10,000 (1) --------- Total......................................................................... $ 520,909.09(1) ===========
- ---------------- (1) Estimated. ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS The Company's Restated Certificate of Incorporation, as amended (the "Certificate of Incorporation"), provides, as do the charters of many other publicly held companies incorporated in the State of Delaware, that the personal liability of directors of the Company to the Company is eliminated to the maximum extent permitted by applicable law. The Certificate of Incorporation provides for the indemnification of the directors, officers, employees, and agents of the Company and its subsidiaries to the full extent that may be permitted by applicable law from time to time. Certain provisions of the Certificate of Incorporation protect the Company's directors against personal liability for monetary damages resulting from breaches of their fiduciary duty of care, except as set forth below. Under the Delaware General Corporation Law, absent these provisions, directors could be held liable for gross negligence in the performance of their duty of care but not for simple negligence. The Company's directors remain liable for breaches of their duty of loyalty to the Company and its stockholders, as well as for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law and transactions from which a director derives improper personal benefit. The Certificate of Incorporation also does not absolve directors of liability under section 174 of the Delaware General Corporation Law, which makes directors personally liable for unlawful dividends or unlawful stock repurchases or redemptions in certain circumstances and expressly sets forth a negligence standard with respect to such liability. Under the Delaware General Corporation Law, directors, officers, employees and other individuals may be indemnified against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement in connection with specified actions, suits, or proceedings, whether civil, criminal, administrative, or investigative (other than an action by or in the right of the corporation -- a "derivative action") if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the Company and, with respect to any criminal action or proceeding, had no reasonable cause to believe their conduct was unlawful. A similar standard of care is applicable in the case of a derivative action, except that indemnification only extends to expenses (including attorneys' fees) incurred in connection with defense or settlement of such an action, and the Delaware General Corporation Law requires court approval before there can be any indemnification of expenses where the person seeking indemnification has been found liable to the Company. The Certificate of Incorporation provides, among other things, that each person who was or is made a party to, or is threatened to be made a party to, or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a "proceeding"), by reason of the fact that he or she, or a person for whom he or she is the legal representative, is or was a director or officer of the Company (or was serving at II-1 35 the request of the Company as a director, officer, employee or agent for another entity), will be indemnified and held harmless by the Company to the fullest extent permitted by applicable law as it presently exists or may be amended, against all expense, liability or loss (including attorneys' fees), reasonably incurred by such person in connection therewith. The Company will pay the expenses (including attorneys' fees) incurred in defending any proceeding in advance of its final disposition. However, the payment of expenses incurred by a director or officer in advance of the final disposition of the proceeding will be made only upon receipt by the Company of an undertaking by the director or officer to repay all amounts advanced if it should be ultimately determined that the director or officer is not entitled to be indemnified under the Certificate of Incorporation or otherwise. The foregoing right of indemnification will not be deemed exclusive of any other right to which those indemnified may be entitled against the Company, and the Company may provide additional rights to such persons. If a claim for indemnification or payment of expenses is not paid in full within 60 days after a written claim therefor has been received by the Company, the claimant may file suit to recover the unpaid amount of such claim and, if successful in whole or in part, will be entitled to be paid the expense of prosecuting such claim. In any such action, the Company will have the burden of proving that the claimant was not entitled to the requested indemnification or payment of expenses under applicable law. The rights conferred on any person under the Certificate of Incorporation will not be exclusive of any other rights which such person may have or acquire under any statute, provision of the Certificate of Incorporation, the Company's Amended and Restated By-Laws, agreement, vote of stockholders of the Company or disinterested directors or otherwise. The Company's obligation, if any, to indemnify any person who was or is serving at its request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, enterprise or nonprofit entity will be reduced by any amount such person may collect as indemnification from such other corporation, partnership, joint venture, trust, enterprise or nonprofit entity. Subject to the availability of insurance at substantially similar rates for similar coverage (as determined in the sole discretion of the Company), the Company will maintain insurance at (i) the levels in effect as of June 21, 1993 with respect to each director, officer, employee or agent of the Company until June 21, 1996, or (ii) the levels in effect as of the date of the expiration of the term, death, removal, retirement or resignation of any such person for a period of three years after such event, whichever level is greater, in either case, with respect to any proceeding by reason of the fact that such person, or the person for whom he or she is the legal representative, is or was a director or officer of the Company or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses (including attorneys' fees) reasonably incurred by such person at the Company's expense, to protect the Company and any such person against any such liability, cost, payment or expense; provided, however, that subject to the provisions described herein, the Company will only be required to maintain insurance until the earlier of the date which is (a) three years after the expiration of the term, death, removal, retirement or resignation of any such person and (b) June 21, 1999. Any repeal or modification of the provisions described above will not adversely affect any right or protection under the Certificate of Incorporation of any person in respect of any act or omission occurring prior to the time of such repeal or modification. Under the Company's First Amended Consolidated Plan of Reorganization, dated May 24, 1993, as modified (the "Plan"), and the confirmation order relating thereto of the United States Bankruptcy Court for the Southern District of New York, the obligations of the Company and each of its affiliates to indemnify any person serving as one of its directors, officers or employees as of or following April 15, 1991, by reason of such person's past or future service in such a capacity, or as a director, officer, or employee of another corporation, partnership, or other legal entity, to the extent provided in the applicable certificate of incorporation, by-laws, or similar constituent documents or by statutory law or written agreement of or with the Company or any of its affiliates, were, except as provided below, deemed and treated as executory contracts that were assumed by the Company or any of its affiliates pursuant to the Plan and section 365 of the United States Bankruptcy Code, upon the II-2 36 confirmation of the Plan. Accordingly, such indemnification obligations survived and were unaffected by entry of the confirmation order with respect to the Plan, irrespective of whether such indemnification is owed for an act or event occurring before or after April 15, 1991. The Company entered into indemnification agreements effective as of June 21, 1993 with each of its directors and officers. These indemnification agreements provide for, among other things, the (i) indemnification by the Company of the indemnitees thereunder to the extent described above and (ii) advancement of attorneys' fees and other expenses. Accordingly, the Company will in certain circumstances be obligated to indemnify its former directors and its directors and officers from and after June 21, 1993, including as to matters arising out of service as directors or officers of certain entities other than the Company or any of its affiliates prior to June 21, 1993. Certain of the Company's compensation and stock option plans provide for the indemnification of certain of the Company's officers and directors in connection with certain matters relating to such plans. ITEM 16. EXHIBITS (a) EXHIBITS EXHIBIT NO. DESCRIPTION OF DOCUMENT 2.1 First Amended Consolidated Plan to Reorganization of U.S. Home Corporation and certain of its affiliates dated April 1, 1993. Incorporated by reference from exhibit 2.1 to U.S. Home Corporation's Current Report on Form 8-K filed June 9, 1993. 2.2 Modification to First Amended Consolidated Plan of Reorganization of U.S. Home Corporation and certain of its affiliates. Incorporated by reference from exhibit 2.2 to U.S. Home Corporation's Current Report on Form 8-K filed June 9, 1993. 2.3 First Amended Joint Plan of Reorganization of certain affiliates of U.S. Home Corporation dated April 1, 1993. Incorporated by reference from exhibit 2.3 to U.S. Home Corporation's Current Report on Form 8-K filed June 9, 1993. 2.4 Findings of Fact, Conclusions of Law and Order Confirming the First Amended Consolidated Plan of Reorganization of U.S. Home Corporation and certain of its affiliates. Incorporated by reference from exhibit 28.1 to U.S. Home Corporation's Current Report on Form 8-K filed June 9, 1993. 2.5 Findings of Fact, Conclusions of Law and Order Confirming the First Amended Joint Plan of Reorganization of certain affiliates of U.S. Home Corporation. Incorporated by reference from exhibit 28.2 to U.S. Home Corporation's Current Report on Form 8-K filed June 9, 1993. 4.1 Form of Senior Indenture by and between U.S. Home Corporation and IBJ Schroder Bank & Trust Company, as trustee. 4.2 Form of Senior Subordinated Indenture by and between U.S. Home Corporation and IBJ Schroder Bank & Trust Company, as trustee. 4.3 Form of Subordinated Indenture by and between U.S. Home Corporation and IBJ Schroder Bank & Trust Company, as trustee. 5.1 Opinion of Kaye, Scholer, Fierman, Hays & Handler, LLP. 12 Statements re: Computation of Ratio of Earnings to Fixed Charges. II-3 37 23.1 Consent of Arthur Andersen LLP. 23.2 Consent of Kaye, Scholer, Fierman, Hays & Handler, LLP. Included in such firm's opinion filed as Exhibit 5.1. 24 Power of Attorney. Included on the signature page at Page II-6. 25.1 Statement of Eligibility under the Trust Indenture Act of 1939 of a Corporation Designated to Act as Trustee on Form T-1. 25.2 Statement of Eligibility under the Trust Indenture Act of 1939 of a Corporation Designated to Act as Trustee on Form T-1. 25.3 Statement of Eligibility under the Trust Indenture Act of 1939 of a Corporation Designated to Act as Trustee on Form T-1. ITEM 17. UNDERTAKINGS (a) The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933, unless the information required to be included in such post-effective amendment is contained in a periodic report filed with or furnished to the Securities and Exchange Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 and incorporated herein by reference; (ii) To reflect in the Prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement, unless the information required to be included in such post-effective amendment is contained in a periodic report filed with or furnished to the Securities and Exchange Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 and incorporated herein by reference. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) (Section 230.424(b) of this chapter), if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the Registration Statement; (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; II-4 38 (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described in Item 15 above, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (d) The undersigned registrant hereby further undertakes that: (1) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as a part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4), or 497(h) under the Securities Act of 1933 shall be deemed to be part of this registration statement as of the time it was declared effective. (2) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (e) The undersigned Registrant hereby undertakes to file an application for the purpose of determining the eligibility of the trustee to act under subsection (a) of section 310 of the Trust Indenture Act ("Act") in accordance with the rules and regulations prescribed by the Commission under Section 305(b)(2) of the Act. II-5 39 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Houston, State of Texas, on July 17, 1997. U.S. HOME CORPORATION By: /s/ ROBERT J. STRUDLER --------------------------------------- Robert J. Strudler Chairman and Co-Chief Executive Officer Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated. Each person whose signature appears below hereby authorizes each of Robert J. Strudler, Isaac Heimbinder, Craig M. Johnson, Chester P. Sadowski and Thomas A. Napoli, as attorney-in-fact, to sign and file on his behalf, individually and in each capacity stated below, any pre-effective or post-effective amendment hereto or any registration statement relating to the offering covered hereby filed pursuant to Rule 462(b) under the Securities Act of 1933.
SIGNATURE TITLE DATE --------- ----- ---- /s/ ROBERT J. STRUDLER - --------------------------------------------- Chairman and Co-Chief July 17, 1997 Robert J. Strudler Executive Officer and Director /s/ ISAAC HEIMBINDER Officer, Chief Operating - --------------------------------------------- President, Co-Chief Executive July 17, 1997 Isaac Heimbinder Officer, Chief Operating Officer and Director /s/ CHESTER P. SADOWSKI Vice President -- July 17, 1997 - --------------------------------------------- Controller and Chief Chester P. Sadowski Accounting Officer /s/ THOMAS A. NAPOLI Vice President -- July 17, 1997 - --------------------------------------------- Corporate Finance Thomas A. Napoli and Treasurer (Principal Financial Officer) /s/ GLEN ADAMS - --------------------------------------------- Director July 17, 1997 Glen Adams /s/ STEVEN L. GERARD - --------------------------------------------- Director July 17, 1997 Steven L. Gerard /s/ KENNETH J. HANAU, JR. - --------------------------------------------- Director July 17, 1997 Kenneth J. Hanau, Jr.
II-6 40
SIGNATURE TITLE DATE --------- ----- ---- /s/ MALCOLM T. HOPKINS Director July 17, 1997 - --------------------------------------------- Malcolm T. Hopkins /s/ JACK L. MCDONALD Director July 17, 1997 - --------------------------------------------- Jack L. McDonald /s/ CHARLES A. MCKEE Director July 17, 1997 - --------------------------------------------- Charles A. McKee /s/ GEORGE A. POOLE, JR. Director July 17, 1997 - --------------------------------------------- George A. Poole, Jr. /s/ HERVE RIPAULT Director July 17, 1997 - --------------------------------------------- Herve Ripault /s/ JAMES W. SIGHT Director July 17, 1997 - --------------------------------------------- James W. Sight
II-7 41 EXHIBIT INDEX ------------- EXHIBIT NO. DESCRIPTION OF DOCUMENT 2.1 First Amended Consolidated Plan to Reorganization of U.S. Home Corporation and certain of its affiliates dated April 1, 1993. Incorporated by reference from exhibit 2.1 to U.S. Home Corporation's Current Report on Form 8-K filed June 9, 1993. 2.2 Modification to First Amended Consolidated Plan of Reorganization of U.S. Home Corporation and certain of its affiliates. Incorporated by reference from exhibit 2.2 to U.S. Home Corporation's Current Report on Form 8-K filed June 9, 1993. 2.3 First Amended Joint Plan of Reorganization of certain affiliates of U.S. Home Corporation dated April 1, 1993. Incorporated by reference from exhibit 2.3 to U.S. Home Corporation's Current Report on Form 8-K filed June 9, 1993. 2.4 Findings of Fact, Conclusions of Law and Order Confirming the First Amended Consolidated Plan of Reorganization of U.S. Home Corporation and certain of its affiliates. Incorporated by reference from exhibit 28.1 to U.S. Home Corporation's Current Report on Form 8-K filed June 9, 1993. 2.5 Findings of Fact, Conclusions of Law and Order Confirming the First Amended Joint Plan of Reorganization of certain affiliates of U.S. Home Corporation. Incorporated by reference from exhibit 28.2 to U.S. Home Corporation's Current Report on Form 8-K filed June 9, 1993. 4.1 Form of Senior Indenture by and between U.S. Home Corporation and IBJ Schroder Bank & Trust Company, as trustee. 4.2 Form of Senior Subordinated Indenture by and between U.S. Home Corporation and IBJ Schroder Bank & Trust Company, as trustee. 4.3 Form of Subordinated Indenture by and between U.S. Home Corporation and IBJ Schroder Bank & Trust Company, as trustee. 5.1 Opinion of Kaye, Scholer, Fierman, Hays & Handler, LLP. 12 Statements re: Computation of Ratio of Earnings to Fixed Charges. 23.1 Consent of Arthur Andersen LLP. 23.2 Consent of Kaye, Scholer, Fierman, Hays & Handler, LLP. Included in such firm's opinion filed as Exhibit 5.1. 24 Power of Attorney. Included on the signature page at Page II-6. 25.1 Statement of Eligibility under the Trust Indenture Act of 1939 of a Corporation Designated to Act as Trustee on Form T-1. 25.2 Statement of Eligibility under the Trust Indenture Act of 1939 of a Corporation Designated to Act as Trustee on Form T-1. 25.3 Statement of Eligibility under the Trust Indenture Act of 1939 of a Corporation Designated to Act as Trustee on Form T-1. EX-4.1 2 FORM OF SENIOR INDENTURE 1 EXHIBIT 4.1 --------------------------------------------- FORM OF SENIOR INDENTURE, DATED AS OF _________ __, 199_, BETWEEN U.S. HOME CORPORATION AND IBJ SCHRODER BANK & TRUST COMPANY TRUSTEE --------------------------------------------- 2 CROSS-REFERENCE TABLE TIA SECTION INDENTURE SECTION - ------- ----------------- 310(a)(1).......................................... 9.10 (a)(2).......................................... 9.10 (a)(3).......................................... N.A. (a)(4).......................................... N.A. (b)............................................. 9.08; 9.10 (c)............................................. N.A. 311(a)............................................. 9.11 (b)............................................. 9.11 (c)............................................. N.A. 312(a)............................................. 10.01; 10.02 (b)............................................. 10.02; 14.03 (c)............................................. 10.02 313(a)............................................. 9.06 (b)(1).......................................... 9.06 (b)(2).......................................... 9.06 (c)............................................. 9.06 (d)............................................. 9.06 314(a)............................................. 6.03 (b)............................................. N.A. (c)(1).......................................... 14.04; 14.05 (c)(2).......................................... 14.04; 14.05 (c)(3).......................................... 14.05 (d)............................................. N.A. (e)............................................. 14.05 (f)............................................. N.A. 315(a)............................................. 9.01 (b)............................................. 9.05 (c)............................................. 9.01 (d)............................................. 9.01 (e)............................................. 8.11 316(a)(last sentence).............................. 8.05 (a)(1)(A)....................................... 8.05 (a)(1)(B)....................................... 8.04 (a)(2).......................................... Not applicable (b)............................................. 8.07 3 317(a)(1).......................................... 8.08 (a)(2).......................................... 8.09 (b)............................................. 3.05 318(a)............................................. 14.01 N.A. means not applicable NOTE: This cross-reference table will not, for any purpose, be deemed to be a part of this Indenture. 2 4 TABLE OF CONTENTS Page ---- ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE................................... 1 Section 1.01 Rules of Construction.................................. 1 Section 1.02 Definitions............................................ 2 Affiliate.............................................. 2 Agent.................................................. 2 Bankruptcy Law......................................... 2 Board of Directors..................................... 2 Board Resolution....................................... 2 Business Day........................................... 2 Capital Stock.......................................... 2 Cash Equivalents....................................... 2 Common Equity.......................................... 3 Company................................................ 3 Company Request or Company Order....................... 3 Corporate Trust Office of the Trustee.................. 3 Covenant Defeasance.................................... 3 Custodian.............................................. 3 Default................................................ 3 Defaulted Interest..................................... 3 Defeasance............................................. 3 Defeasible Series...................................... 3 Depository............................................. 3 DTC.................................................... 3 Event of Default....................................... 4 Exchange Act........................................... 4 GAAP................................................... 4 Global Security........................................ 4 Holder................................................. 4 Indenture.............................................. 4 Interest Payment Date.................................. 4 Issue Date............................................. 4 Legal Holiday.......................................... 4 Material Subsidiary.................................... 4 Maturity............................................... 5 i 5 Page ---- Non-Recourse Indebtedness.............................. 5 Officer................................................ 5 Officers' Certificate.................................. 5 Opinion of Counsel..................................... 5 Outstanding............................................ 5 Paying Agent........................................... 6 Person................................................. 6 Place of Payment....................................... 6 Registrar.............................................. 6 Regular Record Date.................................... 6 SEC.................................................... 6 Securities............................................. 7 Security Register...................................... 7 Special Record Date.................................... 7 Stated Maturity........................................ 7 Subsidiary............................................. 7 Successor.............................................. 7 TIA.................................................... 7 Trustee................................................ 7 Trust Officer.......................................... 7 U.S. Government Obligations............................ 7 Section 1.03 Incorporation by Reference of TIA...................... 8 ARTICLE 2 - SECURITY FORMS................................................... 8 Section 2.01 Forms Generally........................................ 8 Section 2.02 Form of Legend for Global Securities................... 9 Section 2.03 Form of Trustee's Certificate of Authentication........ 9 ARTICLE 3 - THE SECURITIES................................................... 10 Section 3.01 Amount Unlimited; Issuable in Series................... 10 Section 3.02 Denominations.......................................... 13 Section 3.03 Execution, Authentication, Delivery and Dating......... 13 Section 3.04 Temporary Securities................................... 15 Section 3.05 Registration, Registration of Transfer and Exchange.... 16 Section 3.06 Mutilated, Destroyed, Lost and Stolen Securities....... 19 Section 3.07 Payment of Interest; Interest Rights Preserved......... 20 Section 3.08 Persons Deemed Owners.................................. 21 Section 3.09 Cancellation........................................... 21 Section 3.10 Computation of Interest................................ 22 ii 6 Page ---- ARTICLE 4 - REDEMPTION....................................................... 22 Section 4.01 Applicability of Article............................... 22 Section 4.02 Election to Redeem; Notice to Trustee.................. 22 Section 4.03 Selection of Securities to Be Redeemed................. 22 Section 4.04 Notices to Holders..................................... 23 Section 4.05 Effect of Notice of Redemption......................... 24 Section 4.06 Deposit of Redemption Price............................ 24 Section 4.07 Securities Redeemed in Part............................ 24 Section 4.08 Optional Redemption.................................... 24 ARTICLE 5 - SINKING FUNDS.................................................... 25 Section 5.01 Applicability of Article............................... 25 Section 5.02 Satisfaction of Sinking Fund Payments with Securities . 25 Section 5.03 Redemption of Securities for Sinking Fund.............. 26 ARTICLE 6 - COVENANTS........................................................ 27 Section 6.01 Payment of Securities.................................. 27 Section 6.02 Maintenance of Office or Agency........................ 27 Section 6.03 SEC Reports; Financial Statements...................... 28 Section 6.04 Money for Security Payments to Be Held in Trust........ 28 Section 6.05 Compliance Certificate................................. 30 Section 6.06 Corporate Existence, etc............................... 30 Section 6.07 Payment of Taxes and Other Claims...................... 30 Section 6.08 Insurance.............................................. 31 Section 6.09 Stay, Extension and Usury Laws......................... 31 Section 6.10 Maintenance of Properties.............................. 31 ARTICLE 7 - SUCCESSORS....................................................... 32 Section 7.01 Limitations on Mergers and Consolidations.............. 32 Section 7.02 Successor Corporation Substituted...................... 32 ARTICLE 8 - DEFAULTS AND REMEDIES............................................ 33 Section 8.01 Events of Default...................................... 33 Section 8.02 Acceleration........................................... 35 Section 8.03 Other Remedies......................................... 35 Section 8.04 Waiver of Past Defaults and Compliance With Indenture Provisions............................................. 36 Section 8.05 Control by Majority.................................... 36 Section 8.06 Limitations on Suits................................... 36 Section 8.07 Rights of Holders to Receive Payment................... 37 Section 8.08 Collection Suit by Trustee............................. 37 iii 7 Page ---- Section 8.09 Trustee May File Proofs of Claim....................... 37 Section 8.10 Priorities............................................. 38 Section 8.11 Undertaking for Costs.................................. 38 Section 8.12 Restoration of Rights and Remedies..................... 38 ARTICLE 9 - TRUSTEE.......................................................... 39 Section 9.01 Duties of Trustee...................................... 39 Section 9.02 Rights of Trustee...................................... 40 Section 9.03 Individual Rights of Trustee........................... 41 Section 9.04 Trustee's Disclaimer................................... 41 Section 9.05 Notice of Defaults..................................... 41 Section 9.06 Reports by Trustee to Holders.......................... 42 Section 9.07 Compensation and Indemnity............................. 42 Section 9.08 Replacement of Trustee................................. 43 Section 9.09 Successor Trustee by Merger, etc....................... 44 Section 9.10 Eligibility; Disqualification.......................... 44 Section 9.11 Preferential Collection of Claims Against Company...... 44 ARTICLE 10 - HOLDERS' LISTS.................................................. 45 Section 10.01 Company to Furnish Trustee Names and Addresses of Holders................................................ 45 Section 10.02 Preservation of Information............................ 45 ARTICLE 11 - DEFEASANCE AND COVENANT DEFEASANCE.............................. 45 Section 11.01 Company's Option to Effect Defeasance or Covenant Defeasance............................................. 45 Section 11.02 Defeasance and Discharge............................... 46 Section 11.03 Covenant Defeasance.................................... 46 Section 11.04 Conditions to Defeasance or Covenant Defeasance........ 47 Section 11.05 Deposited Money and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous Provisions....... 49 Section 11.06 Reinstatement.......................................... 49 ARTICLE 12 - SATISFACTION AND DISCHARGE...................................... 50 Section 12.01 Satisfaction and Discharge of Indenture................ 50 Section 12.02 Application of Trust Money............................. 51 ARTICLE 13 - SUPPLEMENTAL INDENTURES......................................... 51 Section 13.01 Supplemental Indentures Without Consent of Holders..... 51 Section 13.02 Supplemental Indentures With Consent of Holders........ 53 Section 13.03 Compliance With TIA.................................... 54 Section 13.04 Revocation and Effect of Consents...................... 54 Section 13.05 Notation on or Exchange of Securities.................. 55 iv 8 Page ---- Section 13.06 Trustee to Sign Amendments, etc........................ 55 ARTICLE 14 - MISCELLANEOUS................................................... 56 Section 14.01 TIA Controls........................................... 56 Section 14.02 Notices................................................ 56 Section 14.03 Communication by Holders With Other Holders............ 57 Section 14.04 Action by Securityholders.............................. 57 Section 14.05 Proof of Execution of Instruments and Holding of Securities............................................. 58 Section 14.06 Obligation to Disclose Beneficial Ownership of Securities............................................. 59 Section 14.07 Certificate and Opinion as to Conditions Precedent..... 59 Section 14.08 Statements Required in Certificate or Opinion.......... 59 Section 14.09 Rules by Trustee and Agents............................ 60 Section 14.10 No Recourse Against Others............................. 60 Section 14.11 Governing Law.......................................... 60 Section 14.12 No Adverse Interpretation of Other Agreements.......... 60 Section 14.13 Successors............................................. 61 Section 14.14 Severability........................................... 61 Section 14.15 Counterpart Originals.................................. 61 Section 14.16 Trustee as Paying Agent and Registrar.................. 61 Section 14.17 Table of Contents, Headings, etc....................... 61 Section 14.18 Benefits of Indenture.................................. 61 Section 14.19 Acceptance of Trust.................................... 61 ARTICLE 15 - MEETINGS OF HOLDERS OF SECURITIES............................... 62 Section 15.01 Purposes of Meetings................................... 62 Section 15.02 Call of Meetings by Trustee............................ 62 Section 15.03 Call of Meetings by Company or Securityholders......... 62 Section 15.04 Person Entitled to Vote at Meeting..................... 63 Section 15.05 Regulations for Meeting................................ 63 v 9 INDENTURE, dated as of _________ __, 199_, between U.S. Home Corporation, a Delaware corporation, and IBJ Schroder Bank & Trust Company, a banking organization organized under the laws of New York, as trustee. RECITALS OF THE COMPANY A. The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured debentures, notes or other evidences of indebtedness (the "Securities") to be issued in one or more series as provided herein. B. All things necessary have been done 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 to make this Indenture a valid agreement of the Company. NOW, THEREFORE, in consideration of the above premises and the acquisition 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 1 DEFINITIONS AND INCORPORATION BY REFERENCE SECTION 1.01 RULES OF CONSTRUCTION For all purposes of this Indenture, 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 accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP; (c) 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 hereof; (d) "or" is not exclusive; and (e) provisions apply to successive events and transactions. 10 Section 1.02 DEFINITIONS Capitalized terms used herein will have the following respective meanings when used herein: "Affiliate" of any Person means any Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, such Person. For purposes of this Indenture, each executive officer and director of the Company and each Restricted Subsidiary will be an Affiliate of the Company. In addition, for purposes of this Indenture, control of a 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. "Agent" means any Registrar or Paying Agent. "Bankruptcy Law" means title 11 of the United States Code, as amended, or any similar federal or state law for the relief of debtors. "Board of Directors" means the board of directors of a Person or any authorized committee of the board of directors of such Person. "Board Resolution" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company 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 a Legal Holiday. "Capital Stock" of any Person means any and all shares, rights to purchase, warrants or options (whether or not currently exercisable), participations, or other equivalents of or interests in (however designated) the equity (which includes, but is not limited to, common stock, preferred stock and partnership and joint venture interests) of such Person (excluding any debt securities that are convertible into, or exchangeable for, such equity). "Cash Equivalents" means any of the following, to the extent owned by the Company, free and clear of all liens and having a maturity of not greater than 90 days from the date of issuance thereof: (i) readily marketable direct obligations of the United States or any agency or instrumentality thereof or obligations unconditionally guaranteed by the full faith and credit of the United States, (ii) insured certificates of deposit of or time deposits with any commercial bank that (a) is a member of the Federal Reserve System, (b) issues (or the parent of which issues) commercial paper rated as described in clause (iii) below, (c) is organized under the laws of the United States or any State thereof and (d) has combined capital and surplus of at least $1,000,000,000 or (iii) commercial paper in an aggregate amount of no more than $5,000,000 per issuer outstanding at any time, issued by any corporation organized under the 2 11 laws of any State of the United States or the District of Columbia that is not an Affiliate of the Company and rated at least "Prime 1" (or the then equivalent grade) by Moody's Investor Service, Inc. or "A-1" (or the then equivalent grade) by Standard & Poor's Corporation. "Common Equity" of any Person means all Capital Stock of such Person that is generally entitled (i) to vote in the election of directors of such Person, or (ii) if such Person is not a corporation, to vote or otherwise participate in the selection of the governing body, partners, managers or others that will control the management and policies of such Person. "Company" means U.S. Home Corporation, a Delaware corporation, and any successor thereof. "Company Request or Company Order" means a written request or order signed in the name of the Company by its Chairman of the Board, its President, its Senior Vice President or a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to the Trustee. "Corporate Trust Office of the Trustee" will be at the address of the Trustee specified in Section 14.02 hereof or such other address as the Trustee may give notice to the Company. "Covenant Defeasance" has the meaning set forth in Section 11.03 hereof. "Custodian" means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law. "Default" means any event, act or condition that is, or after notice or the passage of time or both would be, an Event of Default. "Defaulted Interest" has the meaning set forth in Section 3.07 hereof. "Defeasance" has the meaning set forth in Section 11.02 hereof. "Defeasible Series" has the meaning set forth in Section 11.01 hereof. "Depository" means, with respect to Securities of any series issuable in whole or in part in the form of one or more Global Securities, a clearing agency registered under the Exchange Act that is designated to act as Depository for such Securities as contemplated by Section 3.01. "DTC" has the meaning set forth in Section 2.02 hereof. 3 12 "Event of Default" has the meaning set forth in Section 8.01(a) hereof. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States, as in effect on the Issue Date of the Securities of any series. "Global Security" means a Security that evidences all or part of the Securities of any series and is authenticated and delivered to, and registered in the name of, the Depository for such Securities or a nominee thereof. "Holder" means a Person in whose name a Security is registered. "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, including, for all purposes of this instrument, and any such supplemental indenture, the provisions of the TIA that are deemed to be a part of and govern this instrument and any such supplemental indenture, respectively. The term "Indenture" shall also include the terms of particular series of Securities established as contemplated by Section 3.01 hereof upon receipt by the Trustee of an Opinion of Counsel in accordance with Section 3.03 hereof. "Interest Payment Date", when used with respect to a Security of any series, means the Stated Maturity of an installment of interest on such Security. "Issue Date" means the date of original issuance of the Securities of each series established pursuant to Section 3.01 hereof. "Legal Holiday" means Saturday, Sunday or a day on which banking institutions in New York, New York or at a Place of Payment are authorized or obligated by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday at a Place of Payment, payment shall be made at that place on the next succeeding day that is not a Legal Holiday and no interest shall accrue for the intervening period. "Material Subsidiary" has the meaning set forth in the Indenture, dated as of June 21, 1993, between the Company and IBJ Schroder Bank & Trust Company, relating to the Company's 9 3/4% Senior Notes due 2003 as in effect on the date hereof. 4 13 "Maturity", when used with respect to a Security of any series, means the date on which the principal of such Security or an installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise. "Non-Recourse Indebtedness" has the meaning set forth in the Indenture, dated as of June 21, 1993, between the Company and IBJ Schroder Bank & Trust Company, as trustee, relating to the Company's 9 3/4% Senior Notes due 2003 as in effect on the date hereof. "Officer" means the Chairman of the Board, the President, the Senior Vice President, the Treasurer, any Assistant Treasurer, the Controller, the Secretary, any Assistant Secretary or any Vice President of a Person. "Officers' Certificate" means a certificate signed by two Officers, one of whom must be the Person's Chief Executive Officer (or Co-Chief Executive Officer), Chief Operating Officer, Chief Financial Officer or Chief Accounting Officer. "Opinion of Counsel" means an opinion from legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or the Trustee. "Outstanding", when used with respect to Securities, 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 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; (iii) Securities as to which the Defeasance has been effected pursuant to Section 11.02 hereof; and (iv) Securities which have been paid pursuant to Section 3.06 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 5 14 such Securities are held by a bona fide purchaser in whose hands such Securities are valid obligations of the Company; provided, however, that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, (a) the principal amount of a Security denominated in one or more foreign currencies or currency units shall be the U.S. dollar equivalent, determined in the manner provided as contemplated by Section 3.01 hereof on the Issue Date of such Security, of the principal amount of such Security, and (b) Securities owned by the Company or any other obligor of the Securities or any Subsidiary 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 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 Subsidiary of the Company or of such other obligor. "Paying Agent" means any Person, including the Company, authorized by the Company to pay the principal of or any interest on any Securities of any series. "Person" means any individual, corporation, partnership, joint venture, limited liability company, incorporated or unincorporated association, joint stock company, trust, unincorporated organization or government or other agency or political subdivision thereof or other entity of any kind. "Place of Payment", when used with respect to the Securities of any series, means the place or places where the principal of and interest on the Securities of that series are payable as specified as contemplated by Section 3.01 hereof. "Registered Security" means any Security established pursuant to Section 3.01 hereof which is registered in the Security Register. "Registrar" has the meaning set forth in Section 3.05 hereof. "Regular Record Date" for the interest payable on any Security of any series on any Interest Payment Date means the date specified for that purpose as contemplated by Section 3.01 hereof. "SEC" means the Securities and Exchange Commission, and any successor thereto. 6 15 "Securities" has the meaning set forth in the first recital of this Indenture and more particularly means any securities of any series authenticated and delivered under this Indenture. "Security Register" has the meaning set forth in Section 3.05 hereof. "Special Record Date" for the payment of any Defaulted Interest on any Security means a date fixed by the Trustee pursuant to Section 3.07 hereof. "Stated Maturity", when used with respect to any Security of any series 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. "Subsidiary" of any Person means (i) any corporation of which at least a majority of the aggregate voting power of all classes of the Common Equity is directly or indirectly beneficially owned by such Person, and (ii) any entity other than a corporation of which such Person directly or indirectly beneficially owns at least a majority of the Common Equity. "Successor" has the meaning set forth in Section 7.01(a) hereof. "TIA" means the Trust Indenture Act of 1939, as amended. "Trustee" means the Person named as the "Trustee" in the first paragraph of the Indenture until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Trustee" shall mean or include the Person who is then the Trustee hereunder. "Trust Officer" means any Senior Vice President, Vice President, Assistant Vice President, Assistant Secretary or Assistant Treasurer of the Trustee assigned by the Trustee to administer its corporate trust matters. "U.S. Government Obligations" means (i) any security that is (a) a direct obligation of the United States for the payment of which the full faith and credit of the United States is pledged or (b) an obligation of a Person controlled or supervised by and acting as an agency or instrumentality of the United States the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States, which, in either case (a) or (b), is not callable or redeemable at the option of the issuer thereof, and (ii) any depositary 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 U.S. Government Obligation specified in clause (i) and held by such custodian for the account of the holder of such depositary receipt, or with respect to any specific payment of principal of or interest on any such U.S. Government Obligation; provided that (except as required by law) such custodian is not authorized to make any deduction from the 7 16 amount payable to the holder of such depositary receipt from any amount received by the custodian in respect of the U.S. Government Obligation or the specific payment of principal or interest evidenced by such depositary receipt. SECTION 1.03 INCORPORATION BY REFERENCE OF TIA Whenever this Indenture refers to a provision of the TIA, such provision is incorporated by reference in and made a part of this Indenture. ARTICLE 2 SECURITY FORMS SECTION 2.01 FORMS GENERALLY Each Security and Global Security issued pursuant to this Indenture shall be in substantially the form established by or pursuant to an Officers' Certificate or a Board Resolution or in one or more indentures supplemental hereto, shall have such appropriate insertions, omissions, substitutions and other variations as are required or permitted by or pursuant to this Indenture or any indenture supplemental hereto and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may, consistent herewith, be determined by the Officers executing such Security as evidenced by their execution of such Security. If temporary Securities of any series are issued as Global Securities as permitted by Section 3.04 hereof, the form thereof shall also be established as provided in the previous sentence. If the form of Securities of any series is established by action taken pursuant to an Officers' Certificate or a Board Resolution, a copy thereof shall be delivered to the Trustee at or prior to the delivery of the Company Order contemplated by Section 3.03 hereof for the authentication and delivery of such Securities. If all of the Securities of any series established by action taken pursuant to an Officers' Certificate or a Board Resolution are not to be issued at one time, it shall not be necessary to deliver a copy thereof at the time of issuance of each Security of such series, but such Officers' Certificate or Board Resolution shall be delivered at or prior to the time of issuance of the first Security of such series. Securities shall be printed, lithographed or engraved or produced by any combination of these methods or may be produced in any other manner, all as determined by the Officers of the Company executing such Securities, as evidenced by their execution of such Securities. 8 17 SECTION 2.02 FORM OF LEGEND FOR GLOBAL SECURITIES Every Global Security authenticated and delivered hereunder shall 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 DEPOSITORY OR A NOMINEE OF A DEPOSITORY. THIS GLOBAL 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 SUCH LIMITED CIRCUMSTANCES. EVERY SECURITY DELIVERED UPON REGISTRATION OF TRANSFER OF, OR IN EXCHANGE FOR, OR IN LIEU OF, THIS GLOBAL SECURITY SHALL BE A GLOBAL SECURITY SUBJECT TO THE FOREGOING, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED ABOVE. UNLESS THIS CERTIFICATE 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 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 TO BE 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. SECTION 2.03 FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION The Trustee's certificate of authentication shall be in substantially the following form: 9 18 This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. [Name of Trustee] ----------------------------------- As Trustee By................................. Authorized Signatory ARTICLE 3 THE SECURITIES SECTION 3.01 AMOUNT UNLIMITED; ISSUABLE IN SERIES 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, or determined in the manner provided, in an Officers' Certificate, or established in one or more indentures supplemental hereto, which, in each case, shall be deemed incorporated herein by this reference and made a part hereof but only with respect to the series of Securities established pursuant to such Board Resolution, Officers' Certificate or supplemental indenture, prior to the issuance of Securities of any series of the following: (1) the title of the Securities of the series (which shall distinguish the Securities of the series from Securities of any other series); (2) any limit upon the aggregate principal amount of the Securities of the series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Section 3.04, 3.05, 3.06, 4.07 or 13.05 hereof and except for any Securities which, pursuant to Section 3.03 hereof, are deemed never to have been authenticated and delivered hereunder); 10 19 (3) the Person to whom any interest on a Security of the series shall be payable, if other than the Person in whose name that Security is registered at the close of business on the Regular Record Date for such interest; (4) the date or dates, or the method by which such date or dates will be determined, on which the principal of the Securities of the series is payable; (5) the rate or rates at which the Securities of the series shall bear interest, if any, or the method by which such rate or rates shall be determined, the date or dates from which such interest shall accrue, or the method by which such date or dates shall be determined, the Interest Payment Dates on which any such interest shall be payable and the Regular Record Date, if any, for the interest payable on any Security on any Interest Payment Date, or the method by which such date or dates shall be determined, and the basis upon which interest shall be calculated if other than on the basis of actual days elapsed over a 365 or 366-day year; (6) the place or places, if any, other than or in addition to New York, New York, where the principal of and interest on Securities of the series shall be payable, any Securities of the series may be surrendered for registration of transfer, Securities of the same series may be surrendered for exchange and, if different from the location specified in Section 14.02 hereof, the place or places where notices or demands to or upon the Company in respect of the Securities of the series and this Indenture may be served; (7) the period or periods within, the price or prices at and the terms and conditions upon, which Securities of the series may be redeemed or purchased, in whole or in part, at the option of the Company; (8) the obligation, if any, of the Company to redeem or repurchase Securities of the series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of the series shall be redeemed or repurchased, in whole or in part, pursuant to such obligation; (9) if other than denominations of $1,000 and any integral multiple thereof, the denominations in which Securities of the series shall be issuable; (10) the currency, currencies or currency units in which payment of the principal of and interest on any Securities of the series shall be payable if other than the currency of the United States and the manner of determining the 11 20 equivalent thereof in the currency of the United States for purposes of the definition of "Outstanding" in Section 1.01 hereof; (11) if the principal of or interest on any Securities of the series is to be payable, at the election of the Company or a Holder thereof, in one or more currencies or currency units other than that or those in which the Securities are stated to be payable, the currency, currencies or currency units in which payment of the principal of and interest on Securities of such series as to which such election is made shall be payable, and the periods within which and the terms and conditions upon which such election is to be made; (12) if the amount of payments of principal of or interest on any Securities of the series may be determined with reference to an index, the manner in which such amounts shall be determined; (13) if other than the principal amount of the Securities of any series, the portion of the principal amount of such Securities which shall be payable upon declaration of acceleration of the Maturity thereof; (14) if applicable, that the Securities of the series shall be defeasible as provided in Article 11 hereof; (15) if and as applicable, that the Securities of the series shall be issuable in whole or in part in the form of one or more Global Securities and, in such case, the Depository or Depositories for such Global Security or Global Securities and any circumstances other than those set forth in Section 3.05 hereof in which any such Global Security may be transferred to, and registered and exchanged for Securities registered in the name of, a Person other than the Depository for such Global Security or a nominee thereof and in which any such transfer may be registered; (16) any deletions from, modifications of or additions to the Events of Default or covenants of the Company with respect to Securities of any series, whether or not such Events of Default or covenants are consistent with the Events of Default or covenants set forth herein; (17) if other than the Trustee, the identity of each Paying Agent and Registrar for the Securities of the series; and (18) any other terms of the series. 12 21 All Securities of any one series shall be substantially identical except as to denomination and except as may otherwise be provided in or pursuant to the Board Resolution referred to above and set forth, or determined in the manner provided, in the Officers' Certificate referred to above 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 thereof shall be delivered to the Trustee at or prior to the delivery of the Officers' Certificate setting forth the terms of the series. SECTION 3.02 DENOMINATIONS In the absence of any specified denomination with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $1,000 and any integral multiple thereof. SECTION 3.03 EXECUTION, AUTHENTICATION, DELIVERY AND DATING The Securities shall be executed on behalf of the Company by two Officers, under its corporate seal reproduced thereon. The signature of any of the Officers on the Securities may be manual or by facsimile. Securities bearing the manual or facsimile signatures of individuals who were at any time the proper Officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the date of such Securities. At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series, executed by the Company to the Trustee for authentication, together with a Company Order for the authentication and delivery of such Securities, and the Trustee in accordance with the Company Order shall authenticate and deliver such Securities. The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Securities. An authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such an agent. An authenticating agent has the same rights as an Agent to deal with the Company. The Company shall pay the reasonable fees and expenses of any authenticating agent. If the form or terms of the Securities of the series have been established in or pursuant to one or more Officers' Certificate or Board Resolutions as permitted by Sections 2.01 and 3.01 hereof, in authenticating such Securities, and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, and 13 22 (subject to TIA Sections 315(a) through 315(d)) shall be fully protected in relying upon, an Opinion of Counsel stating: (1) if the form or forms of such Securities have been established by or pursuant to Board Resolution or an Officers' Certificate as permitted by Section 2.01 hereof, that such form or forms have been established in conformity with the provisions of this Indenture; (2) if the terms of such Securities have been established by or pursuant to an Officers' Certificate or a Board Resolution as permitted by Section 3.01 hereof, that such terms have been established in conformity with the provisions of this Indenture; and (3) that such Securities, 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 and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute the legal, valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors' rights, to general equity principles and to such other qualifications as such counsel shall conclude do not materially affect the rights of Holders of such Securities. Notwithstanding the provisions of Section 3.01 hereof and of the preceding paragraph, if all of the Securities of any series are not to be issued at one time, it shall not be necessary to deliver the Officers' Certificate or Board Resolution otherwise required pursuant to Section 3.01 hereof or the Company Order and Opinion of Counsel otherwise required pursuant to such preceding paragraph at the time of issuance of each Security of such series, but such documents shall be delivered at or prior to the time of issuance of the first Security of such series. Notwithstanding the immediately preceding sentence, any subsequent request by the Company to the Trustee to authenticate Securities of such series upon original issuance shall constitute a representation and warranty by the Company that, as of the date of such request, the statements made in the Opinion of Counsel delivered pursuant to this Section 3.03 shall be true and correct as if made on such date. The Trustee shall have the right to decline to authenticate and deliver such Securities if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith by its board of directors or trustees, executive committee or a trust committee of directors or trustees and/or officers of the Trustee shall determine that 14 23 such action would expose the Trustee to personal liability to existing Holders or would adversely affect the Trustee's own rights, duties or immunities under this Indenture or otherwise. 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 duly executed by the Trustee by manual signature of an authorized signatory, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder and is entitled to the benefits of this Indenture. 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 3.09 hereof together with a Company Order (which need not comply with Section 14.08 hereof and need not be accompanied by an Opinion of Counsel) stating that such Security has never been issued or sold by the Company, for all purposes of this Indenture such Security shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled to the benefits of this Indenture. SECTION 3.04 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 authorized denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued, and with such appropriate insertions, omissions, substitutions and other variations as the Officers executing such Securities may determine, as evidenced by their execution of such Securities. Every temporary Security shall be executed by the Company and authenticated by the Trustee and registered by the Registrar, upon the same conditions, and with like effect, as a definitive Security. If temporary Securities (other than a Global Security) of any series are issued, the Company will cause definitive Securities of that series to be prepared without unreasonable delay. After the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities of any series, the Company shall execute and the Trustee shall authenticate and deliver in exchange a like aggregate principal amount of definitive Securities of the same series of authorized denominations. Until so exchanged, the temporary Securities of any series 15 24 shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series. SECTION 3.05 REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE (a) The Company shall maintain a register of the Securities of each series (the "Security Register") in an office or agency of the Company in a Place of Payment (the "Registrar") where, subject to Section 3.05(c) hereof and such reasonable regulations as the Company may prescribe, Securities may be presented for registration of transfer or for exchange. The Company may appoint one or more co-Registrars. The term "Registrar" includes any co-Registrar. The Company may change any Registrar without notice to any Holder. The Company or any of its Subsidiaries may act as Registrar. Subject to Section 3.05(c), upon surrender for registration of transfer of any Security of any series at the office or agency of the Company in a Place of Payment for that series, 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 aggregate principal amount. Subject to Section 3.05(c), at the option of the Holder, Securities of any series may be exchanged for other Securities of the same series, of any authorized denominations and of a like aggregate principal amount, 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 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 Registrar) be duly endorsed, or be accompanied by a written instrument of transfer, in form satisfactory to the Company and the Registrar, duly executed by the Holder thereof or its attorney duly authorized in writing. No service charge shall be made for any registration of 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 registration of transfer or exchange of Securities, other than exchanges pursuant to Section 3.04, 4.07 or 13.05 hereof not involving any transfer. 16 25 The Company shall not be required (i) to issue, register the transfer of or exchange Securities of any series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of Securities of that series selected for redemption under Section 4.08 hereof and ending at the close of business on the day of such mailing, or (ii) to register the transfer or exchange of any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part, or (iii) to issue, register the transfer of or exchange any Security which has been surrendered for repayment at the option of the Holder, except the portion, if any, of such Security not to be so repaid. (b) In case the Company, pursuant to Article 7 hereof, will be consolidated or merged with or into any other Person or will convey, transfer or lease substantially all of its properties and assets to any Person, and the Successor resulting from such consolidation, or surviving such merger, or into which the Company will have been merged, or the Person which will have received a conveyance, transfer or lease as aforesaid, will have executed an indenture supplemental hereto with the Trustee pursuant to Article 7 hereof, any of the Securities authenticated or delivered prior to such consolidation, merger, conveyance, transfer or lease may, from time to time, at the request of the Successor, be exchanged for other Securities executed in the name of the Successor with such changes in phraseology and form as may be appropriate, but otherwise in substance and of like tenor as the Securities surrendered for such exchange and of like principal amount; and the Trustee, upon receipt of an Officers' Certificate from the Successor, will authenticate and deliver Securities as specified in such request for the purpose of such exchange. If Securities will at any time be authenticated and delivered in any new name of a Successor pursuant to this Section 3.05(b) hereof in exchange or substitution for or upon registration of transfer of any Securities, such Successor, at the option of the Holders but without expense to them, will provide for the exchange of all Securities at the time outstanding for Securities authenticated and delivered in such new name. (c) The Company will execute and the Trustee will, in accordance with this Section 3.05(c) for so long as the Securities of any series are to be issued in whole or in part in the form of one or more Global Securities, authenticate and deliver one or more Global Securities that will (i) represent and will be denominated in an amount equal to the aggregate outstanding principal amount of the Securities to be represented by such Global Security or Securities, (ii) be registered in the name of the Depository for such Global Security or Securities or the nominee of such Depository, (iii) be delivered by the Trustee to such Depository or pursuant to such Depository's instructions and (iv) bear the legends set forth in Section 2.02 hereof. Each Depository appointed in accordance with Section 3.01 hereof for a Global Security must, at the time of its appointment and at all times while it serves as Depository, be a clearing agency registered under the Exchange Act, and any other applicable statute or regulation. 17 26 Notwithstanding any other provision of this Section 3.05(c), unless and until it is exchanged in whole for Securities in definitive form of any series, a Global Security representing all or a portion of the Securities of any series may not be transferred except as a whole by the Depository to a nominee of such Depository or by a nominee of such Depository to such Depository or another nominee of such Depository or by such Depository or any such nominee to a successor Depository or a nominee of such successor Depository. If at any time the Depository is unwilling or unable to continue as Depository or if at any time the Depository will no longer be eligible to act as such under this Section 3.05(c), the Company will appoint a successor Depository. If (i) a successor Depository is not appointed by the Company within 90 days after the Company receives notice from the Depository or otherwise becomes aware of such unwillingness, inability or ineligibility or (ii) an Event of Default has occurred and is continuing, the Company will execute and deliver to the Trustee as promptly as practicable Securities in definitive form, together with an Officers' Certificate relating to the authentication and delivery of such Securities, and the Trustee, as promptly as practicable after the receipt of such Securities and Officers' Certificate, will authenticate and deliver Securities in definitive form in an aggregate principal amount equal to the principal amount of, and containing terms and provisions identical to, the Global Security or Securities in exchange for such Global Security or Securities. The Company may at any time and in its sole discretion determine that the Securities of any series issued in the form of one or more Global Securities will no longer be represented by such Global Security or Securities. In such event, the Company will execute and deliver to the Trustee Securities in definitive form, together with an Officers' Certificate relating to the authentication and delivery of Securities in definitive form, and the Trustee, as promptly as practicable after the receipt of such Securities in definitive form and Officers' Certificate, will authenticate and deliver Securities in definitive form in an aggregate principal amount equal to the principal amount of, and containing terms and provisions identical to, the Global Security or Securities in exchange for such Global Security or Securities. Upon the exchange of a Global Security in whole or in part for Securities in definitive form, such Global Security shall be cancelled by the Trustee. Securities in definitive form issued in exchange for a Global Security pursuant to this Section 3.05(c) will be registered in such names and in such authorized denominations as the Depository, pursuant to instructions from its direct or indirect participants or otherwise, will instruct the Trustee in writing. The Trustee will deliver such Securities in definitive form to the Persons in whose names such Securities are so registered or as it may otherwise be directed by the Depository. Upon the exchange of less than the entire principal amount of a Global Security for Securities in definitive form, the Company will also execute, and the Trustee, upon receipt of an Officers' Certificate will also authenticate and deliver, a new Global Security in aggregate principal amount equal to the difference between the principal amount of the surrendered Global Security and the aggregate principal amount of Securities in definitive form issuable upon such exchange. 18 27 In any exchange provided for in any of the preceding three paragraphs, the Company will execute and the Trustee will authenticate and deliver Securities in definitive form in authorized denominations. If a Security in definitive form is issued in exchange for any portion of a Global Security after the close of business at the office or agency where such exchange occurs on or after any Regular Record Date for an Interest Payment Date and before the opening of business at such office or agency on the next Interest Payment Date, interest will not be payable on such Interest Payment Date or proposed date for payment, as the case may be, in respect of such Security in definitive form, but will be payable on such Interest Payment Date only to the Person to whom interest in respect of such portion of such Global Security is payable in accordance with the provisions of this Indenture. None of the Company, the Trustee, any agent of the Trustee, any Paying Agent or the Registrar will have any responsibility or liability for any aspect of the Depository's records relating to or payments made on account of beneficial ownership interests in a Global Security or for maintaining, supervising or reviewing any of the Depository's records relating to such beneficial ownership interests. SECTION 3.06 MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES If any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new Security of the same series and of like principal amount and bearing a number not contemporaneously outstanding. If there shall be delivered to the Company and 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 and 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 Company shall execute and upon receipt of a Company Order the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Security, a new Security of the same series and of like principal amount 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, instruct the Paying Agent to pay such Security. Upon the issuance of any new Security under this Section 3.06, 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. 19 28 Every new Security of any series issued pursuant to this Section 3.06 in lieu of any mutilated, destroyed, lost or stolen Security, shall constitute an original additional contractual obligation of the Company, whether or not the mutilated, 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 of that series duly issued hereunder. The provisions of this Section 3.06 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 3.07 PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED Except as otherwise provided as contemplated by Section 3.01 hereof with respect to any series of Securities, interest on any Security 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 is registered at the close of business on the Regular Record Date for such interest at the office or agency of the Company maintained for such purpose pursuant to Section 6.02 hereof. Any interest on any Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such defaulted interest and, if applicable, interest on such defaulted interest (to the extent lawful) at the rate specified in the Securities of such series (such defaulted interest and, if applicable, interest thereon herein collectively called "Defaulted Interest") may be paid by the Company, at its election in each case, as provided in clause (i) or (ii) below: (i) The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Securities of such series 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 of such series and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money (except as otherwise specified pursuant to Section 3.01 hereof for the Securities of such series) 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 on or prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided. Thereupon, the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 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 20 29 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 Securities of such series at its address as it appears in the Security Register, not less than 10 days prior to such Special Record Date and notice shall be considered given whether or not received by the Holder. If notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor have been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Securities of such series are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (ii). (ii) 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 the securities exchange on which such Securities may be listed, if any, and upon such notice as may be required by such exchange, if, after written 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. The provisions of this Section 3.07 may be applicable to any series of Securities pursuant to Section 3.01 hereof (with such modifications, additions or substitutions as may be specified pursuant to such Section 3.01 hereof). Subject to the foregoing provisions of this Section 3.07 and Section 3.05 hereof, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security. SECTION 3.08 PERSONS DEEMED OWNERS Subject to Section 3.05(c), prior to due presentment of a Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Security is registered as the owner of such Security for the purpose of receiving payment of principal of and (except as contemplated by Section 3.05 hereof and subject to Section 3.07 hereof) interest on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee nor any agent of the Company or Trustee shall be affected by notice to the contrary. SECTION 3.09 CANCELLATION All Securities surrendered for payment, redemption, repayment at the option of the Holder, if applicable, registration of transfer or exchange or for credit against any current or future sinking fund payment shall, if surrendered to any Person other than the Trustee, be 21 30 delivered to the Trustee and shall be promptly cancelled by it. The Company may at any time deliver to the Trustee for cancellation any Securities previously authenticated and delivered hereunder 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 accompanied by an Officers' Certificate authorizing such cancellation, and shall be promptly cancelled by the Trustee. If the Company shall so acquire any of the Securities, however, such acquisition shall not operate as a redemption or satisfaction of the Indebtedness represented by such Securities unless and until the same are surrendered to the Trustee for cancellation. No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled Securities held by the Trustee shall be disposed of as directed by a Company Order. SECTION 3.10 COMPUTATION OF INTEREST Except as otherwise specified as contemplated by Section 3.01 hereof for Securities of any series, interest on the Securities of each series shall be computed on the basis of a 365 or 366-day year. ARTICLE 4 REDEMPTION SECTION 4.01 APPLICABILITY OF ARTICLE If so provided as contemplated by Section 3.01 hereof for Securities of any series, Securities of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and in accordance with this Article 4. SECTION 4.02 ELECTION TO REDEEM; NOTICE TO TRUSTEE In the event the Company elects to redeem Securities of any series pursuant to the optional redemption provisions of Section 4.08 hereof, it will notify the Trustee in writing, at least 30 days but not more than 60 days before a redemption date, of the redemption date and the principal amount of Securities of a series to be redeemed. SECTION 4.03 SELECTION OF SECURITIES TO BE REDEEMED (a) In the event less than all of the Outstanding Securities of a series are to be redeemed, the Trustee will select the Securities of such series to be redeemed pro rata or by lot or 22 31 by any other method the Trustee deems fair and appropriate but only in integral multiples of $1,000. The particular Securities of a series to be redeemed will be selected, unless otherwise provided herein, not less than 20 nor more than 60 days prior to the redemption date by the Trustee from the Outstanding Securities of such series not previously called for redemption. (b) The Trustee will promptly notify the Company in writing of the Securities of such series selected for redemption and, in the case of any Security of a series selected for partial redemption, the principal amount thereof to be redeemed but not in integral multiples of less than $1,000. Provisions of this Indenture that apply to Securities of a series called for redemption also apply to portions of Securities of a series called for redemption. SECTION 4.04 NOTICES TO HOLDERS (a) At least 15 days but not more than 60 days before a redemption date, the Company will mail a notice to each Holder whose Securities are to be redeemed. (b) The notice will identify the Securities of the series to be redeemed and will state: (i) the redemption date; (ii) the redemption price; (iii) if any Outstanding Security of any series is being redeemed in part, the portion of the principal amount of such Security to be redeemed and that, after the redemption date, upon surrender of such Security, a new Security or Securities in principal amount equal to the unredeemed portion will be issued; (iv) the name and address of the Paying Agent; (v) that Securities called for redemption must be surrendered to the Paying Agent at the address specified in such notice to collect the redemption price; (vi) that interest on Securities called for redemption ceases to accrue on and after the redemption date; (vii) that the redemption is for a sinking fund, if such is the case; (viii) the aggregate principal amount of Securities that are being redeemed; and 23 32 (ix) that funds for the redemption price shall be deposited in accordance with Section 4.06 hereof, failing which the notice shall be deemed cancelled. (c) At the Company's written request, the Trustee will give the notice required in this Section 4.04 in the Company's name and at its expense. SECTION 4.05 EFFECT OF NOTICE OF REDEMPTION Once notice of redemption is mailed, Outstanding Securities of such series called for redemption become due and payable on the redemption date at the redemption price and, subject to Section 4.06(b) hereof, interest on such Securities ceases to accrue on and after the redemption date. SECTION 4.06 DEPOSIT OF REDEMPTION PRICE (a) At least one Business Day prior to the redemption date, the Company will deposit with the Trustee or with the Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 6.04 hereof) money sufficient to pay the redemption price of, and accrued and previously unpaid interest on, all Securities of such series to be redeemed on that date, and the Trustee will remit the redemption price to Holders entitled thereto. The Trustee or the Paying Agent will return to the Company any money not required for that purpose. (b) If the Company complies with Section 4.06(a) hereof, interest on the Securities of such series or portions thereof to be redeemed (whether or not such Securities are presented for payment) will cease to accrue on the applicable redemption date. If any Security of such series called for redemption is not so paid upon surrender because of the failure of the Company to comply with Section 4.06(a) hereof, then interest will be paid on the unpaid principal from the last Interest Payment Date until such principal is paid in full at the rate determined pursuant to Section 3.01 hereof for the Securities of such series. SECTION 4.07 SECURITIES REDEEMED IN PART Upon surrender of a Security of such series that is redeemed in part, the Company will issue and the Trustee will authenticate for the Holder at the expense of the Company a new Security of the same series, maturity date, interest rate and Issue Date equal in principal amount to the unredeemed portion of the Security of such series surrendered. SECTION 4.08 OPTIONAL REDEMPTION The Company may redeem all or any portion of the Outstanding Securities of any series at any time and from time to time that are redeemable before their maturity except as 24 33 otherwise specified as contemplated by Section 3.01 hereof for Securities of such series at the redemption prices together in each case, with accrued interest, if any, to the date fixed for redemption, determined pursuant to Section 3.01 hereof. ARTICLE 5 SINKING FUNDS SECTION 5.01 APPLICABILITY OF ARTICLE If so provided as contemplated by Section 3.01 hereof for Securities of any series, retirements of Securities of any series pursuant to any sinking fund shall be made in accordance with their terms and in accordance with this Article 5. The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a "mandatory sinking fund payment", and any payment in excess of such minimum amount provided for by the terms of Securities of any series is herein referred to as an "optional sinking fund payment." If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 5.02 hereof. Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series. SECTION 5.02 SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES Subject to Section 5.03 hereof, in lieu of making all or any part of any mandatory sinking fund payment with respect to any Securities of a series in cash, the Company may at its option (i) deliver to the Trustee Outstanding Securities of a series (other than any previously called for redemption) theretofore purchased or acquired by the Company and/or (ii) receive credit for the principal amount of Securities of a series which have been previously delivered to the Trustee by the Company or for Securities of such series which have been redeemed either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any mandatory sinking fund payment with respect to the Securities of the same series required to be made pursuant to the terms of such Securities as provided for by the terms of such series; provided that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the redemption price specified in such Securities for redemption through operation of the sinking fund and the amount of such mandatory sinking fund payment shall be reduced accordingly. 25 34 SECTION 5.03 REDEMPTION OF SECURITIES FOR SINKING FUND Not less than 60 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee an Officers' Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivering or crediting Securities of that series pursuant to Section 5.02 hereof (which Securities will, if not previously delivered, accompany such Officers' Certificate) and whether the Company intends to exercise its right to make a permitted optional sinking fund payment with respect to such series. Such Officers' Certificate shall be irrevocable and upon its delivery the Company shall be obligated to make the cash payment or payments therein referred to, if any, on or before the next succeeding sinking fund payment date. In the case of the failure of the Company to deliver such Officers' Certificate, the sinking fund payment due on the next succeeding sinking fund payment date for that series shall be paid entirely in cash and shall be sufficient to redeem the principal amount of such Securities subject to a mandatory sinking fund payment without the option to deliver or credit Securities as provided in Section 5.02 hereof and without the right to make any optional sinking fund payment, if any, with respect to such series. Not more than 60 days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 4.03 hereof and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 4.04 hereof. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Article 4 hereof. Prior to any sinking fund payment date, the Company shall pay to the Trustee or a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 6.04 hereof) in cash a sum equal to any interest that will accrue to the date fixed for redemption of Securities or portion thereof to be redeemed on such sinking fund payment date pursuant to this Section 5.03. Notwithstanding the foregoing, with respect to a sinking fund for any series of Securities, if at any time the amount of cash to be paid into such sinking fund on the next succeeding sinking fund payment date, together with any unused balance of any preceding sinking fund payment or payments for such series, does not exceed in the aggregate $100,000, the Company shall not instruct the Trustee to give the next succeeding notice of the redemption of Securities of such series through the operation of the sinking fund. Any such unused balance of moneys deposited in such sinking fund shall be added to the sinking fund payment for such series to be made in cash on the next succeeding sinking fund payment date or, at the request of the Company, shall be applied at any time or from time to time to the purchase of Securities of such series, by public or private purchase as negotiated by the Company, in the open market or 26 35 otherwise, at a purchase price for such Securities (excluding accrued interest and brokerage commissions, for which the Trustee or any Paying Agent will be reimbursed by the Company) not in excess of the principal amount thereof. ARTICLE 6 COVENANTS SECTION 6.01 PAYMENT OF SECURITIES (a) The Company will pay the principal of, and interest on, the Securities of each series on the dates and in the manner provided herein and in the Securities. In the event the Company is not the Paying Agent, principal and interest will be considered paid on the date due if the Trustee or Paying Agent holds on that date money deposited by the Company designated for and sufficient to pay all principal and interest then due. In the event the Company is the Paying Agent, principal and interest will be considered paid on the date actual payment is mailed, or otherwise sent or given, to the Holders entitled to such payments. (b) The Company will pay interest on overdue principal at the applicable interest rate on the Securities of each series as determined in accordance with Section 3.01 hereof. SECTION 6.02 MAINTENANCE OF OFFICE OR AGENCY (a) The Company will maintain in each Place of Payment for any series of Securities, in New York, New York, an office or agency (which may be an office of the Trustee or the Registrar) where Securities of such series may be presented or surrendered for payment, where Securities of that series may be presented for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of such series and this Indenture may be served. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company fails to maintain any such required office or agency or fails 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. (b) The Company may also from time to time designate one or more other offices or agencies where the Securities of each series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission will in any manner relieve the Company of its obligation to maintain an office or agency in New York, New York for such purposes. The Company will 27 36 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. (c) The Company hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Company in accordance with this Section 6.02. SECTION 6.03 SEC REPORTS; FINANCIAL STATEMENTS (a) As long as more than 10 percent of the original principal amount of the Securities of any series is Outstanding, the Company will (i) remain subject to the requirements of Section 13 or 15(d) of the Exchange Act whether or not it is required to do so by the provisions thereof and will file with the SEC all periodic reports as may be required thereunder and (ii) file with the SEC, and the Trustee within 15 days after the Company is required to file the same with the SEC, copies of the periodic reports which the Company may be required to file with the SEC pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act. The Company will also make such reports available to the Holders, prospective purchasers of the Securities of any such series, securities analysts and broker-dealers upon their written request. (b) In the event that (i) 10 percent or less of the original principal amount of the Securities of any series is Outstanding and (ii) the Company is not required to file with the SEC such reports and other information referred to in Section 6.03(a) hereof, the Company will furnish to the Trustee (A) within 120 days after the end of each fiscal year, annual reports containing the information required to be contained in Items 1, 2, 3, 5, 6, 7, 8 and 9 of the Annual Report on Form 10-K promulgated under the Exchange Act, or substantially the same information required to be contained in comparable items of any successor form, (B) within 60 days after the end of each of the first three fiscal quarters of each fiscal year, quarterly reports containing the information required to be contained in the Quarterly Report on Form 10-Q promulgated under the Exchange Act, or substantially the same information required to be contained in any successor form and (C) promptly from the time after the occurrence of an event which would be required to be reported in the Current Report on Form 8-K if the Company was required to file such Report, such other reports containing information required to be contained in the Current Report on Form 8-K promulgated under the Exchange Act, or substantially the same information required to be contained in any successor form. (c) The Company will also comply with the other provisions of TIA Section 314(a). SECTION 6.04 MONEY FOR SECURITY PAYMENTS TO BE HELD IN TRUST (a) In the event the Company will at any time act as its own Paying Agent with respect to any series of Securities, it will, not less than one Business Day before each due date of the principal of or interest on any of the Securities of any series, segregate and hold in 28 37 trust for the benefit of the Holders entitled thereto a sum sufficient to pay the principal or interest so becoming due until such sums will be paid to such Persons or otherwise disposed of as herein provided, and will promptly notify the Trustee of its action or failure to so act. (b) In the event the Company is not acting as Paying Agent with respect to any series of Securities, the Company will, not less than one Business Day before each due date of the principal of or interest on, any Securities of any series, deposit with a Paying Agent a sum in same day funds sufficient to pay the principal or interest so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of such action or any failure to so act. (c) In the event the Company is not acting as Paying Agent with respect to any series of Securities, 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 will agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will: (i) hold all sums held by it for the payment of the principal of or interest on Securities of such series in trust for the benefit of the Holders of such series of Securities and the Trustee entitled thereto until such sums will be paid to such Persons or otherwise disposed of as herein provided; (ii) give the Trustee notice of any Default by the Company in the making of any payment of principal or interest; (iii) 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 (iv) acknowledge, accept and agree to comply in all aspects with the provisions of this Indenture relating to the duties, rights and disabilities of such Paying Agent. (d) 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 sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such sums. 29 38 (e) Except as provided in the Securities of any series, 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 or interest on any Security of any series and remaining unclaimed for two years after such principal or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall 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 New York, 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 notification or publication, any unclaimed balance of such money then remaining will be repaid to the Company. SECTION 6.05 COMPLIANCE CERTIFICATE (a) The Company will deliver to the Trustee within 120 days after the end of each fiscal year of the Company an Officers' Certificate stating whether or not the signers know of any Default or Event of Default that occurred during such period. If they do know of a Default or an Event of Default, the Officers' Certificate will describe the Default or Event of Default and the action the Company is taking or proposes to take with respect thereto. (b) The Company will give prompt written notice to the Trustee of the occurrence of any Default or Event of Default. SECTION 6.06 CORPORATE EXISTENCE, ETC. Subject to the provisions of Article 7 hereof, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and the rights (charter and statutory), licenses and franchises of the Company, except in such cases where a failure to do so would not in the judgment of management have a material adverse effect on the business, prospects, assets or financial condition of the Company and its Subsidiaries taken as a whole and would not have a materially adverse impact on the Holders of Securities of any series. SECTION 6.07 PAYMENT OF TAXES AND OTHER CLAIMS The Company will pay or discharge or cause to be paid or discharged, before the same will become delinquent, (i) all taxes, assessments and governmental charges levied or imposed upon the Company or upon the income, profits or property of the Company other than 30 39 any such tax, assessment, charge or claim whose amount, applicability or validity is being contested in good faith by appropriate proceedings and for which appropriate provision has been made in accordance with GAAP and (ii) all lawful claims for labor, materials and supplies which, if unpaid, might by law become a lien upon the property of the Company, in each case except to the extent the failure to do so would not have, in the judgment of management, a material adverse effect on the Company and its Subsidiaries taken as a whole. SECTION 6.08 INSURANCE The Company will maintain and will cause each of its Subsidiaries to maintain (either in the name of the Company or in such Subsidiary's own name) with third party insurance companies or pursuant to self-insurance, (i) insurance on all their respective properties, (ii) public liability insurance against claims for personal injury or death as a result of the use of any products sold by it and (iii) insurance coverage against other business risks, in each case, in at least such amounts and against at least such other risks (and with such risk retention) as are usually and prudently insured against in the same general area by companies engaged in the same or a similar business. SECTION 6.09 STAY, EXTENSION AND USURY LAWS The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the Company's obligation to pay the Securities of each series, and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law insofar as such law applies to the Securities of each series, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law has been enacted. SECTION 6.10 MAINTENANCE OF PROPERTIES The Company will take reasonable action to maintain in appropriate condition each of its principal properties which in the judgment of management is essential to the business operations of the Company and its Subsidiaries taken as a whole and the loss of which would have a material adverse affect on the financial condition of the Company and its Subsidiaries taken as a whole. Nothing contained in this Section 6.10 will prevent or restrict the sale, abandonment or other disposition of any property which management deems advisable. 31 40 ARTICLE 7 SUCCESSORS SECTION 7.01 LIMITATIONS ON MERGERS AND CONSOLIDATIONS (a) The Company will not consolidate or merge with or into, or sell, lease, convey or otherwise dispose of all or substantially all of its assets (including, without limitation, by way of liquidation or dissolution), or assign any of its obligations hereunder or under the Securities of any series (as an entirety or substantially an entirety in one transaction or series of related transactions), to any Person unless: (i) the Person formed by or surviving such consolidation or merger (if other than the Company), or to which sale, lease, conveyance or other disposition or assignment will be made (collectively, the "Successor"), is a solvent corporation or other legal entity organized and existing under the laws of the United States or any state thereof or the District of Columbia, and the Successor assumes by supplemental indenture in a form reasonably satisfactory to the Trustee all of the obligations of the Company under the Securities of any series and this Indenture, (ii) immediately after giving effect to such transaction, no Default or Event of Default has occurred and is continuing and (iii) the Company will have delivered to the Trustee prior to the consummation of the proposed transaction an Officers' Certificate to the foregoing effect and an Opinion of Counsel stating that the proposed transaction and such supplemental indenture comply with this Indenture. SECTION 7.02 SUCCESSOR CORPORATION SUBSTITUTED Upon any consolidation or merger, or any sale, lease, conveyance or other disposition of all or substantially all of the assets of the Company or any assignment of its obligations under this Indenture or the Securities of any series in accordance with Section 7.01 hereof, upon assumption by the successor corporation, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the due and punctual payment of the principal of and interest on all of the Securities of any series and the due and punctual performance and observance of all the covenants and conditions of this Indenture to be performed or observed by the Company, the Successor formed by such consolidation or into or with which the Company is merged or to which such sale, lease, conveyance or other disposition or assignment is made will 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 has been named as the Company herein and such Successor may cause to be signed and may issue in its own name or in the name of the Company, any or all Securities of any series issuable hereunder and the predecessor Company, in the case of a sale, lease, conveyance or other disposition or assignment, will be released from all obligations under this Indenture and the Securities of any series. 32 41 ARTICLE 8 DEFAULTS AND REMEDIES SECTION 8.01 EVENTS OF DEFAULT (a) "Event of Default", wherever used herein with respect to Securities of any series, means any of the following events (whatever the reason for such Event of Default and whether it will 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): (i) the failure by the Company to pay interest on any Security of that series when the same becomes due and payable and the continuance of any such failure for a period of 30 days; (ii) the failure by the Company to pay the principal of any Security of that series when the same becomes due and payable at Maturity, upon acceleration or otherwise; (iii) the failure by the Company to make any sinking fund payment when the same becomes due and payable by the terms of a Security of that series and Article 5 hereof; (iv) the failure by the Company to comply with any of its agreements or covenants in, or provisions of, the Security of that series or this Indenture (other than an agreement or covenant a default in whose performance or whose breach is elsewhere in this Section specifically dealt with or which has expressly been included in this Indenture solely for the benefit of a series of Securities other than that series) and such failure continues for the period and after the notice specified below; (v) the acceleration of any Indebtedness (other than Non-Recourse Indebtedness) of the Company or any of its Subsidiaries that has an outstanding principal amount of $10,000,000 or more in the aggregate; provided that, in the event any such acceleration is withdrawn or otherwise rescinded within a period of five days after such acceleration by the holders of such Indebtedness, any Event of Default under this Section 8.01(a)(v) will be deemed to be cured and any acceleration hereunder will be deemed withdrawn or rescinded; (vi) the failure by the Company or any of its Subsidiaries to make any principal or interest payment in respect of Indebtedness (other than Non-Recourse Indebtedness) of the Company or any of its Subsidiaries with an outstanding aggregate 33 42 amount of $10,000,000 or more within five days of such principal or interest payment becoming due and payable (after giving effect to any applicable grace period set forth in the documents governing such Indebtedness); (vii) a final judgment or judgments that exceed $10,000,000 or more in the aggregate, for the payment of money, having been entered by a court or courts of competent jurisdiction against the Company or any of its Subsidiaries and such judgment or judgments is not satisfied, stayed, annulled or rescinded within 60 days of being entered; (viii) the Company or any Material Subsidiary pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case, (B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointment of a Custodian of it or for all or substantially all of its property, or (D) makes a general assignment for the benefit of its creditors; (ix) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief against the Company or any Material Subsidiary as debtor in an involuntary case, (B) appoints a Custodian of the Company or any Material Subsidiary or a Custodian for all or substantially all of the property of the Company or any Material Subsidiary, or (C) orders the liquidation of the Company or any Material Subsidiary, and the order or decree remains unstayed and in effect for 60 days; or (x) any other Event of Default provided with respect to Securities of that series. 34 43 (b) The Trustee will not be deemed to know of a Default unless a Trust Officer has actual knowledge of such Default or receives written notice of such Default with specific reference to such Default. (c) A Default under Section 8.01(a)(iv) hereof is not an Event of Default until the Trustee notifies the Company, or the Holders of at least 25 percent in aggregate principal amount of the Outstanding Securities of all series affected thereby notify the Company and the Trustee, of the Default and the Company does not cure the Default within 60 days after receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a "Notice of Default." If such a Default is cured within such time period, it ceases. SECTION 8.02 ACCELERATION (a) If an Event of Default with respect to Securities of any series at the time Outstanding (other than an Event of Default with respect to the Company specified in clause (viii) or (ix) of Section 8.01(a) hereof) occurs and is continuing, the Trustee (after receiving indemnities from the Holders to its satisfaction) by notice to the Company, or the Holders of at least 25 percent in aggregate principal amount of the Outstanding Securities of such series by notice to the Company and the Trustee, may declare all Outstanding Securities of such series to be due and payable immediately. Upon such declaration, the amounts due and payable on the Securities of such series, as determined in Section 8.02(b) hereof, will be due and payable immediately. If an Event of Default specified in clause (viii) or (ix) of Section 8.01(a) hereof occurs, such an amount will ipso facto become and be immediately due and payable without any declaration, notice or other act on the part of the Trustee and the Company or any Holder. The Holders of a majority in aggregate principal amount of the Outstanding Securities of any series by written notice to the Trustee and the Company may waive such Event of Default, rescind an acceleration and its consequences (except an acceleration due to nonpayment of principal or interest on the Securities of such series) if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived. (b) In the event that the maturity of the Securities of any series is accelerated pursuant to Section 8.02(a) hereof, 100 percent of the principal amount of the Securities of such series will become due and payable plus accrued interest, if any, to the date of payment. SECTION 8.03 OTHER REMEDIES (a) If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal or interest on the Securities of any series or to enforce the performance of any provision of the Securities of any series or this Indenture. 35 44 (b) The Trustee may maintain a proceeding even if it does not possess any of the Securities of any series or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default will not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law. SECTION 8.04 WAIVER OF PAST DEFAULTS AND COMPLIANCE WITH INDENTURE PROVISIONS Subject to Sections 8.07 and 13.02 hereof, the Holders of a majority in aggregate principal amount of the Outstanding Securities of any series by notice to the Trustee may waive an existing Default or Event of Default and its consequences (including waivers obtained in connection with a tender offer or exchange offer for Securities), except a continuing Default or Event of Default in the payment of the principal of or interest on any Security of such series. Upon any such waiver, such Default will cease to exist, and any Event of Default arising therefrom will be deemed to have been cured for every purpose of this Indenture, but no such waiver will extend to any subsequent or other Default or Event of Default or impair any right consequent thereon. SECTION 8.05 CONTROL BY MAJORITY The Holders of a majority in aggregate principal amount of the Outstanding Securities of any series may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee (after providing indemnities to the Trustee's satisfaction) or exercising any trust or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture that the Trustee determines may be unduly prejudicial to the rights of other Holders of Securities of such series, or that may subject the Trustee to legal liability; provided that the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction. SECTION 8.06 LIMITATIONS ON SUITS (a) A Holder may pursue a remedy with respect to this Indenture or the Securities of any series only if: (i) the Holder gives to the Trustee written notice of a continuing Event of Default with respect to the Securities of that series; (ii) the Holder(s) of at least 25 percent in aggregate principal amount of all of the Outstanding Securities of that series make a written request to the Trustee to pursue the remedy; 36 45 (iii) such Holder or Holders offer to the Trustee indemnity reasonably satisfactory to the Trustee against any loss, liability or expense; (iv) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and (v) during such 60-day period the Holders of a majority in aggregate principal amount of the Outstanding Securities of such series do not give the Trustee a direction inconsistent with the request. (b) A Holder of a Security of any series may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder. SECTION 8.07 RIGHTS OF HOLDERS TO RECEIVE PAYMENT Notwithstanding any other provision of this Indenture, the right of any Holder of a Security of any series to receive payment of principal and interest on the Security of such series, on or after the respective due dates expressed in the Security of such series, or, subject to Section 8.06 hereof, to bring suit for the enforcement of any such payment on or after such respective dates, will not be impaired or affected without the consent of the Holder. SECTION 8.08 COLLECTION SUIT BY TRUSTEE If an Event of Default specified in Section 8.01(a)(i) or 8.01(a)(ii) hereof occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the amount of principal and interest remaining unpaid on the Securities of such series, determined in accordance with Section 8.02(b) hereof, and such further amount as will be sufficient to cover the costs and expenses of collection, including, without limitation, the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. SECTION 8.09 TRUSTEE MAY FILE PROOFS OF CLAIM The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including, without limitation, any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company, its creditors or property and will be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee consents to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it 37 46 for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 9.07 hereof. Nothing contained herein will 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 8.10 PRIORITIES (a) In the event the Trustee collects any money pursuant to this Article 8, it will pay out the money in the following order: FIRST: to the Trustee for amounts due under Section 9.07 hereof; SECOND: to Holders for amounts due and unpaid on the Securities for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Securities for principal and interest, respectively; and THIRD: to the Company or such other Person legally entitled thereto. (b) The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 8.10. SECTION 8.11 UNDERTAKING FOR COSTS In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant (other than the Trustee) in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 8.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 8.07 hereof, or a suit by Holders of more than ten percent in aggregate principal amount of all of the Outstanding Securities of any series. SECTION 8.12 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 Trustee and the Holders will, subject to any determination in such proceeding, be restored severally and respectively to their former positions hereunder, and 38 47 thereafter all rights and remedies of the Trustee and the Holders will continue as though no such proceeding had been instituted. ARTICLE 9 TRUSTEE SECTION 9.01 DUTIES OF TRUSTEE (a) If an Event of Default has occurred and is continuing, the Trustee will exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in such exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. (b) Except during the continuance of an Event of Default: (i) the Trustee need perform only those duties that are specifically set forth in this Indenture and no others, and no implied covenants or obligations will 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. However, in the case of any such certificates or opinions which are specifically required to be furnished to the Trustee by any of the provisions hereof, the Trustee will examine the certificates and opinions to determine whether or not, on their face, they appear to conform to the requirements of this Indenture. (c) The Trustee may not be relieved from liabilities for its own gross negligent action, its own gross negligent failure to act, or its own willful misconduct, except that: (i) this Section 9.01(c) does not limit the effect of Section 9.01(b) hereof; (ii) the Trustee will not be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee was grossly negligent in ascertaining the pertinent facts; and (iii) the Trustee will not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Sec- 39 48 tion 9.05 hereof or when exercising any other trust or power conferred upon the Trustee under this Indenture. Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to clauses (i), (ii) and (iii) of this Section 9.01(c). (d) No provision of this Indenture will 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 has reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (e) The Trustee will not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. Subject to Sections 9.03 and 9.07 hereof, all money received by the Trustee will, until applied as herein provided, be held in trust for the payment of principal and interest on the Securities. (f) The Trustee shall not be required to give any bond or surety in respect of the exercise of its powers and performance of its duties hereunder. SECTION 9.02 RIGHTS OF TRUSTEE (a) Subject to Section 9.01 hereof: (i) the Trustee may rely and will be protected in acting or refraining from acting upon any document believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in the 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 determines to make such further inquiry or investigation, it will be entitled to examine the books, records, and premises of the Company, personally or by agent or attorney; (ii) before the Trustee acts or refrains from acting, it may require an Officers' Certificate. The Trustee will not be liable for any action it takes or omits to take in good faith in reliance on such Officers' Certificate. The Trustee may consult with counsel satisfactory to it and the written advice of such counsel or any Opinion of Counsel will 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; (iii) the Trustee may act through agents and will not be responsible for the misconduct or negligence of any agent appointed with due care; provided, however, 40 49 that the Trustee will in any event be liable for the misappropriation of funds deposited with it or in an account within its dominion and control; (iv) the Trustee will not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers conferred upon it by this Indenture; and (v) unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company will be sufficient if signed by an Officer of the Company. (b) The Trustee will be under no obligation to exercise and may refuse 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 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. SECTION 9.03 INDIVIDUAL RIGHTS OF TRUSTEE The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or any of its Affiliates with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. However, the Trustee is subject to Sections 9.10 and 9.11 hereof. SECTION 9.04 TRUSTEE'S DISCLAIMER The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities of any series, it will not be accountable for any actions taken by the Company or any action taken by the Trustee hereunder at the direction of the Company or in reliance upon an Opinion of Counsel, and it will not be responsible for any statement or recital herein or any statement in the Securities of any series other than its certificate of authentication. The immunities and exemptions from liability of the Trustee hereunder shall extend to its directors, officers, employees and agents. SECTION 9.05 NOTICE OF DEFAULTS If a Default or Event of Default with respect to any series of Securities occurs and is continuing and if it is known to the Trustee, the Trustee will mail to Holders of such Securities a notice of the Default or Event of Default within 90 days after it occurs. However, except in the case of a Default or Event of Default in payment of principal or interest on any Security of such series or a breach of the Change of Control covenant, the Trustee may withhold such notice if 41 50 and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of such Holders. SECTION 9.06 REPORTS BY TRUSTEE TO HOLDERS (a) Within 60 days after each _________ __, beginning with _________ __, 199_, the Trustee will mail to Holders a brief report dated as of such reporting date that complies with TIA Section 313(a); provided, however, if no event described in TIA Section 313(a) has occurred within such calendar year, no report need be transmitted. The Trustee also will comply with TIA Sections 313(b) and 313(c). (b) A copy of each report at the time of its mailing to Holders will be filed with the SEC and each stock exchange, if any, on which the Securities of any series are listed. The Company will notify the Trustee when the Securities of any series are listed on any stock exchange. SECTION 9.07 COMPENSATION AND INDEMNITY (a) The Company agrees: (i) to pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder (which compensation will not be limited by any provision of law in regard to the compensation of a trustee of an express trust); (ii) 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, without limitation, the reasonable compensation and the expenses, advances and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its gross negligence or bad faith; and (iii) to indemnify the Trustee and its agents for, and to hold them harmless against, any loss, liability or expense incurred without gross negligence or bad faith on their part, arising out of or in connection with the acceptance or administration of this trust, including the costs and expenses of defending themselves against any claim or liability in connection with the exercise or performance of any of their powers or duties hereunder. (b) To secure the Company's payment obligations in this Section 9.07, the Trustee will have a Lien prior to the Securities on all money or property held or collected by the Trustee, except that held in trust to pay principal and interest on particular Securities. 42 51 (c) When the Trustee incurs expenses or renders services after an Event of Default specified in Section 8.01(a)(viii) or (a)(ix) occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law. SECTION 9.08 REPLACEMENT OF TRUSTEE (a) A resignation or removal of the Trustee and appointment of a successor Trustee will become effective only upon the successor Trustee's acceptance of appointment as provided in this Section 9.08. (b) The Trustee may resign and be discharged from the trust hereby created by so notifying the Company in writing. The Holders of a majority in principal amount of the Outstanding Securities of any series may remove the Trustee by so notifying the Trustee and the Company. The Company may remove the Trustee if: (i) the Trustee fails to comply with Section 9.10 hereof; (ii) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law; (iii) a Custodian or public officer takes charge of the Trustee or its property; or (iv) the Trustee becomes incapable of acting. (c) If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company will promptly appoint a successor Trustee. (d) If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of at least ten percent in principal amount of the Outstanding Securities of any series may petition any court of competent jurisdiction for the appointment of a successor Trustee. (e) If the Trustee fails to comply with Section 9.10 hereof, any Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. (f) A successor Trustee will deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon the resignation or removal of the retiring Trustee will become effective, and the successor Trustee will have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee will mail a notice of its 43 52 succession to the Holders. The retiring Trustee will promptly transfer all property held by it as Trustee to the successor Trustee, subject to the Lien provided for in Section 9.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section 9.08, the Company's obligations under Section 9.07 hereof will continue for the benefit of the retiring Trustee. SECTION 9.09 SUCCESSOR TRUSTEE BY MERGER, ETC. (a) Subject to Section 9.10 hereof, if the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act will be the successor Trustee; provided that in the case of a transfer of all or substantially all of its corporate trust business to another corporation, the transferee corporation expressly assumes all of the Trustee's liabilities hereunder. (b) In case any Securities of any series 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 9.10 ELIGIBILITY; DISQUALIFICATION (a) There will at all times be a Trustee hereunder which will (i) be a corporation organized and doing business under the laws of the United States, any state thereof or the District of Columbia, authorized under such laws to exercise corporate trustee power, (ii) be subject to supervision or examination by federal or state (or the District of Columbia) authority and (iii) have a combined capital and surplus of at least $150 million as set forth in its most recent published annual report of condition. (b) This Indenture will always have a Trustee who satisfies the requirements of TIA Sections 310(a)(1) and 310(a)(2). The Trustee is subject to TIA Section 310(b). If at any time the Trustee ceases to be eligible in accordance with the provisions of this Section 9.10, it will resign immediately in the manner and with the effect specified in Section 9.08 hereof. SECTION 9.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY The Trustee is subject to TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). A Trustee who has resigned or been removed will be subject to TIA Section 311(a) to the extent indicated therein. 44 53 ARTICLE 10 HOLDERS' LISTS SECTION 10.01 COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF HOLDERS The Company will furnish or cause to be furnished to the Trustee: (i) semi-annually, not more than 15 days before each Interest Payment Date, a list, in such form as the Trustee may reasonably require, of the names and addresses of the Holders of such series of Securities as of the Regular Record Date of such Interest Payment Date; and (ii) at such other times as the Trustee may request in writing, within 30 days after 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, however, that if and so long as the Trustee will be the Registrar, no such list need be furnished. SECTION 10.02 PRESERVATION OF INFORMATION The Trustee will preserve, in as current a form as is reasonably practicable, the names and addresses of Holders of each series of Securities contained in the most recent list furnished to the Trustee as provided in Section 10.01 hereof and the names and addresses of such Holders received by the Trustee in its capacity as Registrar or Paying Agent (if so acting). The Trustee may destroy any list furnished to it as provided in Section 10.01 hereof upon receipt of a new list so furnished. ARTICLE 11 DEFEASANCE AND COVENANT DEFEASANCE SECTION 11.01 COMPANY'S OPTION TO EFFECT DEFEASANCE OR COVENANT DEFEASANCE The Company may elect, at its option by Board Resolution at any time, to have either Section 11.02 or 11.03 hereof applied to the Outstanding Securities of any series designated pursuant to Section 3.01 hereof as being defeasible pursuant to this Article 11 (hereinafter called a "Defeasible Series"), upon compliance with the conditions set forth below in this Article 11. 45 54 SECTION 11.02 DEFEASANCE AND DISCHARGE Upon the Company's exercise of the option provided in Section 11.01 hereof to have this Section 11.02 applied to the Outstanding Securities of any Defeasible Series, the Company shall be deemed to have been discharged from its obligations with respect to the Outstanding Securities of such series as provided in this Section 11.02 on and after the date the conditions set forth in Section 11.04 hereof 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 the Outstanding Securities of such series, which shall thereafter be deemed to be "Outstanding" only for the purposes of Section 11.05 hereof and the other Sections of this Indenture referred to in (i) and (ii) below, and to have satisfied all its other obligations under the Securities of such series and this Indenture insofar as such Securities are concerned (and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged hereunder: (i) the rights of Holders of Outstanding Securities of such series to receive solely from the trust fund described in Section 11.04 hereof and as more fully set forth in such Section, payments in respect of the principal of and interest on such Securities of such series when payments are due, (ii) the Company's obligations with respect to the Securities of such series under Sections 3.04, 3.05, 3.06, 6.02 and 6.04 hereof, (iii) the rights, powers, trusts, duties and immunities of the Trustee hereunder and (iv) this Article 11. Subject to compliance with this Article 11, the Company may exercise its option provided in Section 11.01 hereof to have this Section 11.02 applied to the Outstanding Securities of any Defeasible Series notwithstanding the prior exercise of its option provided in Section 11.01 hereof to have Section 11.03 hereof applied to such Outstanding Securities. SECTION 11.03 COVENANT DEFEASANCE Upon the Company's exercise of the option provided in Section 11.01 hereof to have this Section 11.03 applied to the Outstanding Securities, (i) the Company shall be released from its obligations under Sections 6.03 and 6.06 through 6.10, inclusive, Article 7, and any other covenants specified in or pursuant to this Indenture and (ii) the occurrence of any event specified in Sections 8.01(a)(iv) (with respect to any of Sections 6.03 and 6.06 through 6.10 inclusive, and any other covenants specified in or pursuant to this Indenture) and 8.01(a)(x) shall be deemed not to be or result in an Event of Default, in each case with respect to the Outstanding Securities of such series as provided in this Section 11.03 on and after the date the conditions set forth in Section 11.04 hereof are satisfied (hereinafter called "Covenant Defeasance"), and such Securities shall thereafter be deemed not to be "Outstanding" for the purposes of any direction, waiver, consent, declaration or act of Holders (and the consequences thereof) in connection with such covenants, but shall continue to be "Outstanding" for all other purposes hereunder. For this purpose, such Covenant Defeasance means that, with respect to such Outstanding 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 covenant, whether directly or indirectly by reason of any 46 55 reference elsewhere herein to any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or Event of Default under Section 8.01(a)(iv) or 8.01(a)(x), or otherwise, as the case may be, but, except as specified above, the remainder of this Indenture and the Securities of such series shall be unaffected thereby. SECTION 11.04 CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE The following shall be the conditions to application of either Section 11.02 or 11.03 hereof to the Outstanding Securities of any Defeasible Series: (i) The Company shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee that satisfies the requirements contemplated by Section 9.10 hereof and agrees to comply with the provisions of this Article 11 applicable to it) as trust funds in trust for the purpose of making the following payments, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of Outstanding Securities of such series, (A) money in an amount, or (B) U.S. Government Obligations that through the scheduled payment of principal and interest in respect thereof in accordance with their terms will provide, not later than one day before the due date of any payment, money in an amount, or (C) a combination thereof, in each case sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or any such other qualifying trustee) to pay and discharge, (1) the principal of and interest on the Securities of such series on the respective Stated Maturities (or redemption date, if applicable) of such principal or installment of interest and (2) any mandatory sinking fund payments or analogous payments applicable to such Outstanding Securities on the day on which such payments are due and payable in accordance with the terms of this Indenture and such Securities; provided that the Trustee shall have been irrevocably instructed to apply such money or the proceeds of such U.S. Government Obligations to said payments with respect to such Securities. Before such a deposit, the Company may give to the Trustee, in accordance with Section 4.02 hereof, a notice of its election to redeem all or any portion of such Outstanding Securities at a future date in accordance with the terms of the Securities of such series and Article 4 hereof, which notice shall be irrevocable. Such irrevocable redemption notice, if given, shall be given effect in applying the foregoing. (ii) In the case of an election under Section 11.02 hereof, 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 first set forth hereinabove, there has been a 47 56 change in the applicable Federal income tax law, in either case, to the effect that, and based thereon such opinion shall confirm that, the Holders of the Outstanding Securities of such series will not recognize income, gain or loss for Federal income tax purposes as a result of such Defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at the same times as would be the case if such deposit, Defeasance and discharge were not to occur. (iii) In the case of an election under Section 11.03 hereof, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders of the Outstanding Securities of such series will not recognize income, gain or loss for Federal income tax purposes as result of such Covenant Defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at the same times as would be the case if such deposit and Covenant Defeasance were not to occur. (iv) The Company shall have delivered to the Trustee an Officers' Certificate to the effect that the Securities of such series, if then listed on any securities exchange, will not be delisted as a result of such Defeasance or Covenant Defeasance. (v) No Default or Event of Default shall have occurred and be continuing at the time of such deposit. (vi) Such Defeasance or Covenant Defeasance shall not cause the Trustee to have a conflicting interest within the meaning of the TIA (assuming all Securities are in default within the meaning of the TIA). (vii) Such Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, any other agreement or instrument to which the Company is a party or by which it is bound. (viii) Notwithstanding any other provisions of this Section, such Defeasance or Covenant Defeasance shall be effected in compliance with any additional or substitute terms, conditions or limitations in connection therewith pursuant to Section 3.01 hereof. (ix) The Company shall have delivered to the Trustee an Officers' Certificate, stating that all conditions precedent with respect to such Defeasance or Covenant Defeasance have been complied with. 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 48 57 Company Act of 1940, as amended, unless such trust shall be qualified under such Act or exempt from regulation thereunder. SECTION 11.05 DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS Subject to the provisions of Section 6.04(e) hereof, all money and U.S. Government Obligations (or other property as may be provided pursuant to Section 3.01 hereof) (including the proceeds thereof) deposited with the Trustee or other qualifying trustee (solely for purposes of this Section 11.05 and Section 11.06 hereof, the Trustee and any such other trustee are referred to collectively as the "Trustee") pursuant to Section 11.04 hereof in respect of the Outstanding Securities of any Defeasible Series shall be held in trust and applied by the Trustee, in accordance with the provisions of the Outstanding Securities of such series 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 interest, but such 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 U.S. Government Obligations deposited pursuant to Section 11.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge that by law is for the account of the Holders of Outstanding Securities. Anything in this Article 11 to the contrary notwithstanding, the Trustee shall deliver or pay to the Company any money or U.S. Government Obligations (or other property and any proceeds therefrom) held by it with respect to Outstanding Securities of any Defeasible Series that are in excess of the amount thereof that was used to pay the Securities of such series upon Maturity. SECTION 11.06 REINSTATEMENT If the Trustee or the Paying Agent is unable to apply any money in accordance with this Article 11 with respect to the Securities of any series by reason of any notification, order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company's obligations under this Indenture and the Securities of such series shall be revived and reinstated as though no deposit had occurred pursuant to this Article 11 with respect to Securities of such series until such time as the Trustee or Paying Agent is permitted to apply all money held in trust pursuant to Section 11.05 hereof with respect to Securities of such series in accordance with this Article 11; provided, however, that if the Company makes any payment of principal of or interest on any Security of such series following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of Securities of such series to receive such payment from the money so held in trust. 49 58 ARTICLE 12 SATISFACTION AND DISCHARGE SECTION 12.01 SATISFACTION AND DISCHARGE OF INDENTURE This Indenture shall upon Company Request cease to be of further effect with respect to any series of Securities (except as to any surviving rights of registration of transfer or exchange of Securities of such series herein expressly provided for) and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture as to such series when (i) either (A) all Securities of such series theretofore authenticated and delivered (other than (i) Securities of such series which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 3.06 hereof, and (ii) Securities of such series for whose payment money has theretofore been deposited in trust with the Trustee or any Paying Agent or segregated and held in trust by the Company and thereafter repaid to the Company, as provided in Section 6.04 hereof) have been delivered to the Trustee for cancellation; or (B) all Securities of such series and, in the case of (1) or (2) below, not theretofore delivered to the Trustee for cancellation (1) have become due and payable, or (2) will become due and payable at their Stated Maturity within one year, or (3) if redeemable at the option of the Company, are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company, and the Company, in the case of (1), (2) or (3) above, has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust for such purpose an amount in cash sufficient to pay and discharge the entire Indebtedness on such Securities not theretofore delivered to the Trustee for cancellation, for principal and interest to the date of such deposit (in the case of Securities which have 50 59 become due and payable) or to the Stated Maturity or redemption date, as the case may be; (ii) the Company has paid or caused to be paid all other sums payable hereunder by the Company; and (iii) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture as to such series have been complied with. Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 9.07 hereof and, if money shall have been deposited with the Trustee pursuant to subclause (B) of clause (i) of this Section 12.01, the obligations of the Trustee under Sections 12.02 and 6.04(e) hereof shall survive. SECTION 12.02 APPLICATION OF TRUST MONEY Subject to the provisions of Section 6.04(e) hereof, all money deposited with the Trustee pursuant to Section 12.01 hereof shall be held in trust and applied by it, in accordance with the provisions of the Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal and interest for whose payment such money has been deposited with the Trustee; but such money need not be segregated from other funds except to the extent required by law. ARTICLE 13 SUPPLEMENTAL INDENTURES SECTION 13.01 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS (a) The Company and the Trustee may amend this Indenture or the Securities or waive any provision hereof without the consent of any Holder: (i) to cure any ambiguity, defect or inconsistency; (ii) to comply with Section 7.01 hereof; (iii) to provide for uncertificated Securities in addition to certificated Securities; 51 60 (iv) to make any change that does not adversely affect the legal rights hereunder of any Holder of a Security of any series; (v) to add to the covenants of the Company 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; (vi) to add any additional Events of Default for the benefit of the Holders of all or any series of Securities (and if such Events of Default are to be for the benefit of less then all series of Securities, stating that such Events of Default are being included solely for the benefit of such series); (vii) to change or eliminate any of the provisions of this Indenture in respect of one or more series of Securities; provided that any such addition, 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; (viii) to establish the form or terms of Securities of any series as permitted by Sections 2.01 and 3.01 hereof; (ix) to evidence and provide for the acceptance of appointment hereunder of a successor Trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 9.08 hereof; (x) to supplement any of the provisions of the Indenture to such extent as shall be necessary to implement the provisions of Article 11 hereof or discharge of any series of Securities pursuant to Sections 12.01, 12.02 and 12.03 hereof; provided that any such action shall not adversely affect the interests of the Holders of Securities of such series or any other series in any material respect; or (xi) to comply with the qualification of this Indenture under the TIA. (b) Upon the request of the Company, accompanied by a Board Resolution authorizing the execution of any such supplemental indenture, and upon receipt by the Trustee of the documents described in Section 13.06 hereof, the Trustee will join with the Company in the execution of any supplemental indenture authorized or permitted by the terms of this Indenture and make any further appropriate agreements and stipulations that may be contained therein. 52 61 After an amendment or waiver under this Section 13.01 becomes effective, the Company will mail to the Holders of each Security affected thereby a notice describing the amendment or waiver. Any failure of the Company to mail such notice, will not, however, affect the validity of any such supplemental indenture. SECTION 13.02 SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS (a) Except as provided below in this Section 13.02, the Company and the Trustee may amend this Indenture or the Securities with the written consent (including consents obtained in connection with a tender offer or exchange offer for Securities) of the Holders of at least a majority in principal amount of the Outstanding Securities of each series affected by such amendment. (b) Upon the request of the Company, accompanied by a Board Resolution authorizing the execution of any such supplemental indenture, and upon the filing with the Trustee of evidence of the consent of the Holders as aforesaid, and upon receipt by the Trustee of the documents described in Section 13.06 hereof, the Trustee will join with the Company in the execution of such supplemental indenture. (c) It will not be necessary for the consent of the Holders under this Section 13.02 to approve the particular form of any proposed amendment or waiver, but it will be sufficient if such consent approves the substance thereof. (d) The Holders of a majority in principal amount of the Outstanding Securities of each series affected may waive compliance in a particular instance by the Company with any provision of this Indenture (including waivers obtained in connection with a tender offer or exchange offer for Securities). However, without the consent of each Holder of an Outstanding Security affected thereby, an amendment or waiver under this Section 13.02 may not: (i) change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Security, or reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or change the Place of Payment where any Security or interest thereon is payable, or change 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 or repayment at the option of the Holder, on or after the redemption date or repayment date), or (ii) reduce the percentage in principal amount of the Outstanding Securities of any series, the consent of whose Holders is required for any such 53 62 amendment, 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 (iii) modify any of the provisions of this Section or Section 8.07, 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, or (iv) modify the ranking or priority of the Securities in a manner adverse to the Holders. (e) A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture 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. (f) The right of any Holder to participate in any consent required or sought pursuant to any provision of this Indenture (and the obligation of the Company to obtain any such consent otherwise required from such Holder) may be subject to the requirement that such Holder has been the Holder of record of any Securities of any series with respect to which such consent is required or sought as of a date identified by the Trustee in a notice furnished to Holders in accordance with the terms of this Indenture. SECTION 13.03 COMPLIANCE WITH TIA Every amendment to this Indenture or the Securities will comply in form and substance with the TIA as then in effect. SECTION 13.04 REVOCATION AND EFFECT OF CONSENTS (a) Until an amendment (which includes any supplement) or waiver becomes effective, a consent to it by a Holder of a Security of any series is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder's Security, even if notation of the consent is not made on any Security. However, any such Holder or subsequent Holder may revoke the consent as to such Holder's Security or portion of a Security if the Trustee receives written notice of revocation before the date the amendment or waiver becomes effective. An amendment or waiver becomes effective in accordance with its terms and thereafter binds every Holder. 54 63 (b) The Company may, but will not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment or waiver. If the Company elects to fix a record date for such purpose, the record date will be fixed at (i) the later of 30 days prior to the first solicitation of such consent or the date of the most recent list of Holders furnished to the Trustee prior to such solicitation pursuant to Section 10.02 hereof or (ii) such other date as the Company will designate. If a record date is fixed, then notwithstanding the provisions of Section 13.04(a) hereof, those Persons who were Holders at such record date (or their duly designated proxies), and only those Persons, will be entitled to consent to such amendment or waiver or to revoke any consent previously given, whether or not such Persons continue to be Holders after such record date. No consent will be valid or effective for more than 90 days unless consents from Holders of the principal amount of Securities required hereunder for such amendment or waiver to be effective has also been given and not revoked within such 90-day period. (c) After an amendment or waiver becomes effective it will bind every Holder of a Security of any series affected thereby, unless it is of the type described in any of clauses (i) through (iv) of Section 13.02(d) hereof. Any amendment or waiver will bind each Holder of a Security who has consented to it and every subsequent Holder of a Security that evidences the same debt as the consenting Holder's Security. SECTION 13.05 NOTATION ON OR EXCHANGE OF SECURITIES The Trustee may place an appropriate notation about an amendment or waiver on any Security of any series affected thereby thereafter authenticated. The Company in exchange for all Securities of such series may issue and the Trustee will authenticate new Securities of such series that reflect the amendment or waiver. SECTION 13.06 TRUSTEE TO SIGN AMENDMENTS, ETC. The Trustee will sign any amendment or supplemental indenture authorized pursuant to this Article 13 if the amendment does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may, but need not, sign it. In signing or refusing to sign such amendment or supplemental indenture, the Trustee will be entitled to receive and, subject to Section 9.01 hereof, will be fully protected in relying upon, an Officers' Certificate and an Opinion of Counsel as conclusive evidence that such amendment or supplemental indenture is authorized or permitted by this Indenture, that it is not inconsistent herewith, and that it will be valid and binding upon the Company in accordance with its terms. 55 64 ARTICLE 14 MISCELLANEOUS SECTION 14.01 TIA CONTROLS If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by TIA Section 318(c), the imposed duties will control. SECTION 14.02 NOTICES (a) Any notice or communication by the Company or the Trustee to the other is duly given if in writing and delivered in person or mailed by first class mail (registered or certified, return receipt requested), telex, telecopier or overnight air courier guaranteeing next day delivery, to the other's address: If to the Company: U.S. Home Corporation 1800 West Loop South Houston, Texas 77027 Telecopier No.: (713) 877-2387 Confirmation No.: (713) 877-2311 Attention: President If to the Trustee: IBJ Schroder Bank & Trust Company One State Street New York, New York 10004 Telecopier No.: (212) 858-2952 Confirmation No.: (212) 858-2529 Attention: Corporate Trust Agency & Administration (b) The Company or the Trustee, by notice to the other, may designate additional or different addresses for subsequent notices or communications. (c) All notices and communications will be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, if mailed; when answered back, if telexed; when receipt acknowledged by the Trustee's transmission result report, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery. 56 65 (d) Any notice or communication to a Holder will be mailed by first-class, postage-prepaid mail, return receipt requested, to the Holder's address shown on the register kept by the Registrar. Failure to mail a notice or communication to a Holder or any defect in it will not affect its sufficiency with respect to other Holders. (e) If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it. (f) If the Company mails a notice or communication to Holders, it will mail a copy to the Trustee and each Agent at the same time. SECTION 14.03 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS Holders may communicate pursuant to TIA Section 312(b) with other Holders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Securities Register and anyone else will have the protection of TIA Section 312(c). SECTION 14.04 ACTION BY SECURITYHOLDERS Whenever in this Indenture it is provided that the Holders of a specified percentage in aggregate principal amount of the Outstanding Securities may take any action (including the making of any demand or request, the giving of any notice, consent or waiver or the taking of any other action), the fact that at the time of taking any such action the Holders of such specified percentage have joined therein may be evidenced by any instrument or any number of instruments of similar tenor executed by (i) Holders in person or (ii) agent or proxy appointed in writing, or by the record of the Holders in favor thereof, at any meeting of Holders duly called and held in accordance with the provisions of Article 15 hereof, or (iii) a combination of such instrument or instruments of any such record of such meeting of Holders, but in each case only to the extent that the Holders shall not have revoked such action pursuant to Section 13.04 hereof. Without limiting the generality of this Section 14.04, a Holder, including a Depository that is a Holder of one or more Global Securities, may make, give or take, by a proxy or proxies duly appointed in writing, any request, demand, authorization, direction, notice, consent, waiver or other action provided in this Indenture to be made, given or taken by Holders and a Depository that is a Holder of one or more Global Securities may provide its proxy or proxies to the beneficial owners of interests in any such Global Securities through such Depository's standing instructions and customary practices. The Company, with advance approval by the Trustee, will fix a record date for the purpose of determining the Persons who are beneficial owners of interests in any Global Security held by a Depository entitled under the procedures of such Depository to make, give or take, by a 57 66 proxy or proxies duly appointed in writing, any request, demand, authorization, direction, notice, consent, waiver or other action provided in this Indenture to be made, given or taken by Holders. If such a record date is fixed, the Persons who are such beneficial owners at the close of business on such record date or their duly appointed proxy or proxies will be entitled to make, give or take such request, demand, authorization, direction, notice, consent, waiver or other actions, whether or not such Persons remain such beneficial owners after such record date. No such request, demand, authorization, direction, notice, consent, waiver or other action will be valid or effective if made, given or taken more than six months after such record date. SECTION 14.05 PROOF OF EXECUTION OF INSTRUMENTS AND HOLDING OF SECURITIES Proof of the execution of any instrument by a Holder or such Holder's agent or proxy and proof of the holding by any Person of any of the Securities shall be sufficient if made in the following manner: (1) The fact and date of the execution by any such Person of any instrument may be proved by the certificate of any notary public or other officer of any jurisdiction authorized to take acknowledgments of deeds to be recorded in such jurisdiction that the Person executing such instrument acknowledged to him the execution thereof, or by an affidavit of a witness to such execution sworn to before any such notary or other officer. Such certificate or affidavit shall also constitute sufficient proof of the authority of the Person executing any instrument in cases where Securities are not held by Persons in their individual capacities. (2) The fact and date of execution of any such instrument may also be proved in any other manner which the Trustee deems sufficient. (3) The ownership of Securities shall be proved by the Securities Register for such Security or by a certificate of the Registrar. (4) The Trustee shall not be bound to recognize any Person as a Securityholder unless such Holder's title to any Security held by such Holder is proved in the manner provided in this Section 14.05. The Trustee may require such additional proof of any matter referred to in this Section 14.05 as it shall deem necessary. 58 67 SECTION 14.06 OBLIGATION TO DISCLOSE BENEFICIAL OWNERSHIP OF SECURITIES All Securities shall be held and owned upon the express condition that, upon demand of any regulatory agency having jurisdiction over the Company, and pursuant to law or regulation empowering such agency to assert such demand, any Holder shall disclose to such agency the identity of the beneficial owner of all Securities held by such Holder. SECTION 14.07 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company will furnish to the Trustee and the Trustee may rely upon, as conclusive evidence: (i) an Officers' Certificate (which will include the statements set forth in Section 14.08 hereof) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been complied with; and (ii) an Opinion of Counsel (which will include the statements set forth in Section 14.08 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been complied with. SECTION 14.08 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION (a) Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA Section 314(a)(4)) will include: (i) a statement that the Person making such certificate or opinion has read such condition or covenant; (ii) 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; (iii) a statement that, in the opinion of such Person, such Person has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such condition or covenant has been complied with; and (iv) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with. 59 68 (b) Any Officers' Certificate may be based, insofar as it relates to legal matters, upon an Opinion of Counsel, unless such Officer knows that the opinion with respect to the matters upon which his certificate may be based as aforesaid is erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any Opinion of Counsel may be based, insofar as it relates to factual matters, upon the certificate, statement or opinion of or representations by an officer or officers of the Company, or other Persons or firms deemed appropriate by such counsel, unless such counsel has actual knowledge that the certificate, statement or opinion or representations with respect to the matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous. (c) Any Officers' Certificate, statement or Opinion of Counsel may be based, insofar as it relates to accounting matters, upon a certificate or opinion of or representation by an accountant (who may be an employee of the Company), or firm of accountants, unless such Officer or counsel, as the case may be, has actual knowledge that the certificate or opinion or representation with respect to the accounting matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous. SECTION 14.09 RULES BY TRUSTEE AND AGENTS The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions. SECTION 14.10 NO RECOURSE AGAINST OTHERS A director, officer or employee of the Company, as such, will have no liability for any obligations of the Company under the Securities or this Indenture. Each Holder by accepting a Security waives and releases all such liability. SECTION 14.11 GOVERNING LAW This Indenture and the Securities will be governed by and construed in accordance with the laws of the State of New York, without regard to principles of conflicts of law. SECTION 14.12 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary thereof. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. This writing constitutes the entire agreement of the parties with respect to the subject matter hereof. Unless expressly otherwise indicated herein, an action or transaction permitted by one provision hereof must nonetheless comply with all other applicable provisions hereof; and any action or transaction not permitted by any provision of this 60 69 Indenture will not be permitted regardless of whether any other provision hereof might permit such action or transaction. SECTION 14.13 SUCCESSORS All agreements of the Company in this Indenture and the Securities will bind its successors. All agreements of the Trustee in this Indenture will bind its successors. SECTION 14.14 SEVERABILITY In case any provision in this Indenture or in the Securities is invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby. SECTION 14.15 COUNTERPART ORIGINALS The parties may sign any number of copies of this Indenture. Each signed copy will be an original, but all of them together represent the same agreement. SECTION 14.16 TRUSTEE AS PAYING AGENT AND REGISTRAR The Company initially appoints the Trustee as Paying Agent and Registrar. SECTION 14.17 TABLE OF CONTENTS, HEADINGS, ETC. The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof and will in no way modify or restrict any of the terms or provisions hereof. SECTION 14.18 BENEFITS OF INDENTURE Nothing in this Indenture or in the Securities, express or implied, will give to any Person, other than the parties hereto and their successors hereunder and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture. SECTION 14.19 ACCEPTANCE OF TRUST IBJ Schroder Bank & Trust Company, the Trustee named herein, hereby accepts the trusts in this Indenture declared and provided, upon the terms and conditions hereinabove set forth. 61 70 ARTICLE 15 MEETINGS OF HOLDERS OF SECURITIES SECTION 15.01 PURPOSES OF MEETINGS A meeting of Holders may be called at any time and from time to time pursuant to the provisions of this Article 15 for any of the following purposes: (a) to give any notice to the Company or to the Trustee, or to give any direction to the Trustee, or to waive any non-performance hereunder, and its consequences, or to take any other action authorized to be taken by Holders pursuant to any of the provisions of this Indenture; (b) to remove the Trustee and appoint a successor Trustee pursuant to the provisions of Section 9.08 hereof; (c) to consent to the amendment of the provisions contained herein and the execution of an indenture or indentures supplemental hereto pursuant to the provisions of Article 13 hereof; or (d) to take any other action authorized to be taken by or on behalf of the Holders of any specified aggregate principal amount of the Outstanding Securities under any other provision of this Indenture or under applicable law. SECTION 15.02 CALL OF MEETINGS BY TRUSTEE The Trustee may at any time call a meeting of Holders to take any action specified in Section 15.01, to be held at such time and at such place in the State of New York, as the Trustee shall determine. Notice of each meeting of the Holders of Securities, setting forth the time and the place of such meeting and, in general terms, the action proposed to be taken at such meeting, shall be mailed by the Trustee to the Holders, not less than 20 nor more than 60 days prior to the date fixed for the meeting, at their last addresses as they shall appear on the Security Register. SECTION 15.03 CALL OF MEETINGS BY COMPANY OR SECURITYHOLDERS If at any time the Company, pursuant to a Board Resolution, or the Holders of at least 20 percent in aggregate principal amount of the Outstanding Securities, shall have requested the Trustee to call a meeting of Holders to take any action authorized in Section 15.01 hereof, by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have mailed notice of such meeting within 20 days after receipt of such 62 71 request, then the Company or the Holders in the amount above specified may determine the time and the place in the State of New York for such meeting, and may call such meeting by mailing notice thereof as provided in Section 15.02. SECTION 15.04 PERSON ENTITLED TO VOTE AT MEETING To be entitled to vote at any meeting of Holders, a Person shall be a Holder or be a Person appointed by an instrument in writing as proxy by a Holder. The only Persons who shall be entitled to be present or speak at any meeting of the Holders shall be the Persons entitled to vote at such meeting and their counsel and any representatives of the Company and its counsel. SECTION 15.05 REGULATIONS FOR MEETING Notwithstanding any provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Holders in regard to the appointment of proxies, the proof of the holding of Securities, the appointment and duties of inspectors of votes, the submission and examination of proxies and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall think fit. Except as otherwise permitted or required by any such regulations, the holding of Securities shall be proved in the manner specified in Section 14.05 hereof and the appointment of any proxy shall be proved in the manner specified in such Section 14.05 or by having the signature of the person executing the proxy witnessed or guaranteed by any bank, banker, trust company or New York Stock Exchange, Inc. member firm satisfactory to the Trustee. The Trustee shall, by an instrument in writing, appoint a temporary chairperson of the meeting, unless the meeting shall have been called by the Company or by the Holders as provided in Section 15.03, in which case the Company or the Holders calling the meeting, as the case may be, shall appoint a temporary chairman. A permanent chairperson and a permanent secretary of the meeting shall be elected by vote of the Holders of a majority in principal amount of the Securities represented at the meeting and entitled to vote. At any meeting of Holders, the presence of Persons holding or representing Securities in an aggregate principal amount sufficient to take action upon the business for the transaction of which such meeting was called shall be necessary to constitute a quorum; but, if less than a quorum be present, the Persons holding or representing a majority in aggregate principal amount of the Securities represented at the meeting may adjourn such meeting with the same effect, for all intents and purposes, as though a quorum had been present. 63 72 IN WITNESS WHEREOF, the undersigned have duly executed this Indenture as of the date first above written. U.S. HOME CORPORATION By:_____________________________________ IBJ SCHRODER BANK & TRUST COMPANY, as Trustee By:_____________________________________ 64 EX-4.2 3 FORM OF SENIOR SUBORDINATED INDENTURE 1 EXHIBIT 4.2 ---------------------------- FORM OF SENIOR SUBORDINATED INDENTURE, DATED AS OF _________ __, 199_, BETWEEN U.S. HOME CORPORATION AND IBJ SCHRODER BANK & TRUST COMPANY TRUSTEE ---------------------------- 2 CROSS-REFERENCE TABLE TIA SECTION INDENTURE SECTION ------- ----------------- 310 (a)(1).................................................. 9.10 (a)(2).................................................. 9.10 (a)(3).................................................. N.A. (a)(4).................................................. N.A. (b)..................................................... 9.08; 9.10 (c)..................................................... N.A. 311 (a)..................................................... 9.11 (b)..................................................... 9.11 (c)..................................................... N.A. 312 (a)..................................................... 10.01; 10.02 (b)..................................................... 10.02; 14.03 (c)..................................................... 10.02 313 (a)..................................................... 9.06 (b)(1).................................................. 9.06 (b)(2).................................................. 9.06 (c)..................................................... 9.06 (d)..................................................... 9.06 314 (a)..................................................... 6.03 (b)..................................................... N.A. (c)(1).................................................. 14.04; 14.05 (c)(2).................................................. 14.04; 14.05 (c)(3).................................................. 14.05 (d)..................................................... N.A. (e)..................................................... 14.05 (f)..................................................... N.A. 315 (a)..................................................... 9.01 (b)..................................................... 9.05 (c)..................................................... 9.01 (d)..................................................... 9.01 (e)..................................................... 8.11 316 (a)(last sentence)...................................... 8.05 (a)(1)(A)............................................... 8.05 (a)(1)(B)............................................... 8.04 (a)(2).................................................. Not applicable (b)..................................................... 8.07
3 317(a)(1).................................................... 8.08 (a)(2).................................................... 8.09 (b)....................................................... 3.05 318(a)....................................................... 14.01
N.A. means not applicable NOTE: This cross-reference table will not, for any purpose, be deemed to be a part of this Indenture. 2 4 TABLE OF CONTENTS Page ---- ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE.......................1 Section 1.01 Rules of Construction..................................1 Section 1.02 Definitions............................................2 Acquisition Debt.......................................2 Affiliate..............................................2 Affiliate Transaction..................................2 Agent..................................................2 Bankruptcy Law.........................................2 Board of Directors.....................................2 Board Resolution.......................................2 Business Day...........................................2 Capital Stock..........................................2 Capitalized Lease Obligations..........................3 Cash Equivalents.......................................3 Change of Control Offer................................4 Change of Control Payment Date.........................4 Change of Control Price................................4 Common Equity..........................................4 Company................................................4 Company Request or Company Order.......................4 Consolidated Net Income................................4 Consolidated Tangible Net Worth........................5 Corporate Trust Office of the Trustee..................5 Covenant Defeasance....................................5 Custodian..............................................5 Default................................................5 Defaulted Interest.....................................5 Defeasance.............................................5 Defeasible Series......................................5 Depository.............................................5 Disqualified Stock.....................................6 DTC....................................................6 Event of Default.......................................6 Exchange Act...........................................6 Excluded Debt..........................................6 Existing Credit Facility...............................6
i 5 Page ---- Existing Indebtedness..................................7 Fair Market Value......................................7 GAAP...................................................7 Global Security........................................7 Hedging Obligations....................................7 Holder.................................................7 Incur..................................................7 Indebtedness...........................................7 Indenture..............................................8 Independent Financial Advisor..........................8 Intangible Assets......................................8 Interest Payment Date..................................8 Investments............................................9 Issue Date.............................................9 Legal Holiday..........................................9 Lien...................................................9 Material Subsidiary....................................9 Maturity...............................................9 Net Worth Amount.......................................9 Net Worth Offer........................................9 Net Worth Offer Date...................................9 Net Worth Offer Price..................................9 Non-Recourse Indebtedness.............................10 Officer...............................................10 Officers' Certificate.................................10 Opinion of Counsel....................................10 Outstanding...........................................10 Paying Agent..........................................11 Permitted Investment..................................11 Person................................................12 Place of Payment......................................12 Preferred Stock.......................................12 Refinancing Indebtedness..............................12 Registrar.............................................12 Regular Record Date...................................12 Restricted Investment.................................13 Restricted Payment....................................13 Restricted Subsidiary.................................13 SEC...................................................14 Securities............................................14 Security Register.....................................14
ii 6 Page ---- Senior Indebtedness....................................14 Special Record Date....................................14 Stated Maturity........................................14 Subsidiary.............................................15 Successor..............................................15 TIA....................................................15 Trustee................................................15 Trust Officer..........................................15 U.S. Government Obligations............................15 Unrestricted Subsidiary................................15 Weighted Average Life to Maturity......................16 Wholly Owned Subsidiary................................16 Section 1.03 Incorporation by Reference of TIA......................16 ARTICLE 2 SECURITY FORMS..................................................17 Section 2.01 Forms Generally........................................17 Section 2.02 Form of Legend for Global Securities...................17 Section 2.03 Form of Trustee's Certificate of Authentication........18 ARTICLE 3 THE SECURITIES..................................................18 Section 3.01 Amount Unlimited; Issuable in Series...................18 Section 3.02 Denominations..........................................21 Section 3.03 Execution, Authentication, Delivery and Dating.........21 Section 3.04 Temporary Securities...................................23 Section 3.05 Registration, Registration of Transfer and Exchange....24 Section 3.06 Mutilated, Destroyed, Lost and Stolen Securities.......27 Section 3.07 Payment of Interest; Interest Rights Preserved.........28 Section 3.08 Persons Deemed Owners..................................30 Section 3.09 Cancellation...........................................30 Section 3.10 Computation of Interest................................30 ARTICLE 4 REDEMPTION......................................................31 Section 4.01 Applicability of Article...............................31 Section 4.02 Election to Redeem; Notice to Trustee..................31 Section 4.03 Selection of Securities to Be Redeemed.................31 Section 4.04 Notices to Holders.....................................31 Section 4.05 Effect of Notice of Redemption.........................32 Section 4.06 Deposit of Redemption Price............................32 Section 4.07 Securities Redeemed in Part............................33 Section 4.08 Optional Redemption....................................33
iii 7 Page ---- ARTICLE 5 SINKING FUNDS........................................................................33 Section 5.01 Applicability of Article....................................................33 Section 5.02 Satisfaction of Sinking Fund Payments with Securities.......................34 Section 5.03 Redemption of Securities for Sinking Fund...................................34 ARTICLE 6 COVENANTS............................................................................35 Section 6.01 Payment of Securities.......................................................35 Section 6.02 Maintenance of Office or Agency.............................................36 Section 6.03 SEC Reports; Financial Statements...........................................36 Section 6.04 Money for Security Payments to Be Held in Trust.............................37 Section 6.05 Compliance Certificate......................................................38 Section 6.06 Corporate Existence, etc....................................................39 Section 6.07 Payment of Taxes and Other Claims...........................................39 Section 6.08 Insurance...................................................................39 Section 6.09 Stay, Extension and Usury Laws..............................................40 Section 6.10 Maintenance of Properties...................................................40 Section 6.11 Prohibition on Issuance of Other Subordinated Indebtedness Senior to the Securities..............................................................40 Section 6.12 Limitations on Restricted Payments..........................................40 Section 6.13 Limitations on Additional Indebtedness......................................41 Section 6.14 Change of Control...........................................................42 Section 6.15 Limitations on Transactions With Affiliates.................................45 Section 6.16 Limitations on Restrictions on Distributions from Restricted Subsidiaries................................................................46 Section 6.17 Maintenance of Consolidated Tangible Net Worth..............................47 ARTICLE 7 SUCCESSORS...........................................................................49 Section 7.01 Limitations on Mergers and Consolidations...................................49 Section 7.02 Successor Corporation Substituted...........................................50 ARTICLE 8 DEFAULTS AND REMEDIES................................................................51 Section 8.01 Events of Default...........................................................51 Section 8.02 Acceleration................................................................53 Section 8.03 Other Remedies..............................................................53 Section 8.04 Waiver of Past Defaults and Compliance With Indenture Provisions..................................................................54 Section 8.05 Control by Majority.........................................................54 Section 8.06 Limitations on Suits........................................................54 Section 8.07 Rights of Holders to Receive Payment........................................55 Section 8.08 Collection Suit by Trustee..................................................55
iv 8 Page ---- Section 8.09 Trustee May File Proofs of Claim.......................................55 Section 8.10 Priorities.............................................................56 Section 8.11 Undertaking for Costs..................................................56 Section 8.12 Restoration of Rights and Remedies.....................................57 ARTICLE 9 TRUSTEE............................................................................57 Section 9.01 Duties of Trustee......................................................57 Section 9.02 Rights of Trustee......................................................58 Section 9.03 Individual Rights of Trustee...........................................59 Section 9.04 Trustee's Disclaimer...................................................59 Section 9.05 Notice of Defaults.....................................................60 Section 9.06 Reports by Trustee to Holders..........................................60 Section 9.07 Compensation and Indemnity.............................................60 Section 9.08 Replacement of Trustee.................................................61 Section 9.09 Successor Trustee by Merger, etc.......................................62 Section 9.10 Eligibility; Disqualification..........................................62 Section 9.11 Preferential Collection of Claims Against Company......................63 ARTICLE 10 HOLDERS' LISTS....................................................................63 Section 10.01 Company to Furnish Trustee Names and Addresses of Holders..............63 Section 10.02 Preservation of Information............................................63 ARTICLE 11 DEFEASANCE AND COVENANT DEFEASANCE................................................64 Section 11.01 Company's Option to Effect Defeasance or Covenant Defeasance...........64 Section 11.02 Defeasance and Discharge...............................................64 Section 11.03 Covenant Defeasance....................................................65 Section 11.04 Conditions to Defeasance or Covenant Defeasance........................65 Section 11.05 Deposited Money and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous Provisions......................67 Section 11.06 Reinstatement..........................................................68 ARTICLE 12 SATISFACTION AND DISCHARGE........................................................68 Section 12.01 Satisfaction and Discharge of Indenture................................68 Section 12.02 Application of Trust Money.............................................70 ARTICLE 13 SUPPLEMENTAL INDENTURES...........................................................70 Section 13.01 Supplemental Indentures Without Consent of Holders.....................70 Section 13.02 Supplemental Indentures With Consent of Holders........................71 Section 13.03 Compliance With TIA....................................................73 Section 13.04 Revocation and Effect of Consents......................................73 Section 13.05 Notation on or Exchange of Securities..................................74
v 9 Page ---- Section 13.06 Trustee to Sign Amendments, etc..............................................74 Section 13.07 Subordination Unimpaired.....................................................74 ARTICLE 14 MISCELLANEOUS...........................................................................74 Section 14.01 TIA Controls.................................................................74 Section 14.02 Notices......................................................................75 Section 14.03 Communication by Holders With Other Holders..................................76 Section 14.04 Action by Securityholders....................................................76 Section 14.05 Proof of Execution of Instruments and Holding of Securities..................77 Section 14.06 Obligation to Disclose Beneficial Ownership of Securities....................77 Section 14.07 Certificate and Opinion as to Conditions Precedent...........................77 Section 14.08 Statements Required in Certificate or Opinion................................78 Section 14.09 Rules by Trustee and Agents..................................................79 Section 14.10 No Recourse Against Others...................................................79 Section 14.11 Governing Law................................................................79 Section 14.12 No Adverse Interpretation of Other Agreements................................79 Section 14.13 Successors...................................................................79 Section 14.14 Severability.................................................................80 Section 14.15 Counterpart Originals........................................................80 Section 14.16 Trustee as Paying Agent and Registrar........................................80 Section 14.17 Table of Contents, Headings, etc.............................................80 Section 14.18 Benefits of Indenture........................................................80 Section 14.19 Acceptance of Trust..........................................................80 ARTICLE 15 MEETINGS OF HOLDERS OF SECURITIES.......................................................81 Section 15.01 Purposes of Meetings.........................................................81 Section 15.02 Call of Meetings by Trustee..................................................81 Section 15.03 Call of Meetings by Company or Securityholders...............................81 Section 15.04 Person Entitled to Vote at Meeting...........................................82 Section 15.05 Regulations for Meeting......................................................82 ARTICLE 16 SUBORDINATION; SENIORITY................................................................83 Section 16.01 Securities Subordinated to Senior Indebtedness...............................83 Section 16.02 Company Not To Make Payments with Respect to Securities in Certain Circumstances................................................................83 Section 16.03 Subrogation of Securities....................................................85 Section 16.04 Authorization by Holders.....................................................86 Section 16.05 Notices to Trustee...........................................................86 Section 16.06 Trustee's Relation to Senior Indebtedness....................................88 Section 16.07 No Impairment of Subordination...............................................88 Section 16.08 Article 16 Not to Prevent Events of Default..................................88
vi 10 Page ---- Section 16.09 Paying Agents Other Than the Trustee........................................88
vii 11 INDENTURE, dated as of _________ __, 199_, between U.S. Home Corporation, a Delaware corporation, and IBJ Schroder Bank & Trust Company, a banking organization organized under the laws of New York, as trustee. RECITALS OF THE COMPANY A. The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured debentures, notes or other evidences of indebtedness (the "Securities") to be issued in one or more series as provided herein. B. All things necessary have been done 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 to make this Indenture a valid agreement of the Company. NOW, THEREFORE, in consideration of the above premises and the acquisition 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 1 DEFINITIONS AND INCORPORATION BY REFERENCE SECTION 1.01 RULES OF CONSTRUCTION For all purposes of this Indenture, 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 accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP; (c) 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 hereof; (d) "or" is not exclusive; and (e) provisions apply to successive events and transactions. 1 12 SECTION 1.02 DEFINITIONS Capitalized terms used herein will have the following respective meanings when used herein: "Acquisition Debt" means Indebtedness of any Person existing at the time such Person became a Subsidiary of the Company (or such Person is merged into the Company or one of the Company's Subsidiaries) or assumed in connection with the acquisition of assets from any such Person (other than assets acquired in the ordinary course of business of the Company and its Subsidiaries), including, without limitation, Indebtedness Incurred in connection with, or in contemplation of, such Person becoming a Subsidiary of the Company (but excluding Indebtedness of such Person which is extinguished, retired or repaid in connection with such Person becoming a Subsidiary of the Company). "Affiliate" of any Person means any Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, such Person. For purposes of this Indenture, each executive officer and director of the Company and each Restricted Subsidiary will be an Affiliate of the Company. In addition, for purposes of this Indenture, control of a 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. Notwithstanding the foregoing, the term "Affiliate" will not include, with respect to the Company or any Restricted Subsidiary which is a Wholly Owned Subsidiary of the Company, any Restricted Subsidiary which is a Wholly Owned Subsidiary of the Company. "Affiliate Transaction" has the meaning set forth in Section 6.15(a) hereof. "Agent" means any Registrar or Paying Agent. "Bankruptcy Law" means title 11 of the United States Code, as amended, or any similar federal or state law for the relief of debtors. "Board of Directors" means the board of directors of a Person or any authorized committee of the board of directors of such Person. "Board Resolution" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company 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 a Legal Holiday. "Capital Stock" of any Person means any and all shares, rights to purchase, warrants or options (whether or not currently exercisable), participations, or other equivalents of 2 13 or interests in (however designated) the equity (which includes, but is not limited to, common stock, preferred stock and partnership and joint venture interests) of such Person (excluding any debt securities that are convertible into, or exchangeable for, such equity). "Capitalized Lease Obligations" of any Person means any obligation of such Person to pay rent or other amounts under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP, and the amount of such obligation will be the capitalized amount thereof determined in accordance with GAAP. "Cash Equivalents" means any of the following, to the extent owned by the Company, free and clear of all Liens and having a maturity of not greater than 90 days from the date of issuance thereof: (i) readily marketable direct obligations of the United States or any agency or instrumentality thereof or obligations unconditionally guaranteed by the full faith and credit of the United States, (ii) insured certificates of deposit of or time deposits with any commercial bank that (a) is a member of the Federal Reserve System, (b) issues (or the parent of which issues) commercial paper rated as described in clause (iii) below, (c) is organized under the laws of the United States or any State thereof and (d) has combined capital and surplus of at least $1,000,000,000 or (iii) commercial paper in an aggregate amount of no more than $5,000,000 per issuer outstanding at any time, issued by any corporation organized under the laws of any State of the United States or the District of Columbia that is not an Affiliate of the Company and rated at least "Prime-1" (or the then equivalent grade) by Moody's Investor Service, Inc. or "A-1" (or the then equivalent grade) by Standard & Poor's Corporation. "Change of Control" means any of the following: (i) the sale, lease, conveyance or other disposition of all or substantially all of the Company's assets as an entirety or substantially as an entirety to any Person or group of Persons (within the meaning of Section 13(d)(3) of the Exchange Act) in one or a series of transactions; provided that a transaction where the holders of all classes of Common Equity of the Company immediately prior to such transaction own, directly or indirectly, 50 percent or more of the aggregate voting power of all classes of Common Equity of such Person or group immediately after such transaction will not be a Change of Control, (ii) the acquisition by the Company and/or any of its Subsidiaries of 50 percent or more of the aggregate voting power of all classes of Common Equity of the Company in one transaction or a series of related transactions, (iii) the liquidation or dissolution of the Company; provided that a liquidation or dissolution of the Company which is part of a transaction or series of related transactions that does not constitute a Change of Control under the "provided" clause of clause (i) above will not constitute a Change of Control under this clause (iii) or (iv) any transaction or a series of related transactions (as a result of a tender offer, merger, consolidation or otherwise) that results in, or that is in connection with, (a) any Person, including, a "group" (within the meaning of Section 13(d)(3) of the Exchange Act) acquiring beneficial ownership (as determined in accordance with Rule 13d-3 under the Exchange Act), directly or indirectly, of 50 percent or more of the aggregate voting power of all classes of Common Equity of the Company or of any Person that possesses beneficial ownership (as determined in accordance with Rule 3 14 13d-3 under the Exchange Act), directly or indirectly, of 50 percent or more of the aggregate voting power of all classes of Common Equity of the Company or (b) less than 50 percent (measured by the aggregate voting power of all classes) of the Common Equity of the Company being registered under Section 12(b) or 12(g) of the Exchange Act. "Change of Control Offer" has the meaning set forth in Section 6.14(a) hereof. "Change of Control Payment Date" has the meaning set forth in Section 6.14(a) hereof. "Change of Control Price" has the meaning set forth in Section 6.14(a) hereof. "Common Equity" of any Person means all Capital Stock of such Person that is generally entitled (i) to vote in the election of directors of such Person, or (ii) if such Person is not a corporation, to vote or otherwise participate in the selection of the governing body, partners, managers or others that will control the management and policies of such Person. "Company" means U.S. Home Corporation, a Delaware corporation, and any successor thereof. "Company Request" or "Company Order" means a written request or order signed in the name of the Company by its Chairman of the Board, its President, its Senior Vice President or a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to the Trustee. "Consolidated Net Income" of the Company for any period means the aggregate net income (or loss) of the Company and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP; provided that there will be excluded from such net income (to the extent otherwise included therein), without duplication: (i) the net income (or loss) of any Person (other than a Restricted Subsidiary) in which any Person (including, without limitation, an Unrestricted Subsidiary) other than the Company has an ownership interest, except to the extent that any such income has actually been received by the Company or any Restricted Subsidiary in the form of dividends or similar distributions during such period, (ii) except to the extent includible in the Consolidated Net Income pursuant to the foregoing clause (i), the net income (or loss) of any Person that accrued prior to the date that (a) such Person becomes a Restricted Subsidiary or is merged into or consolidated with the Company or any of its Restricted Subsidiaries or (b) the assets of such Person are acquired by the Company or any of its Restricted Subsidiaries, (iii) the net income of any Restricted Subsidiary to the extent that (but only so long as) the declaration or payment of dividends or similar distributions by such Restricted Subsidiary of that income is not permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary during such period, (iv) in the 4 15 case of a successor to the Company by consolidation, merger or transfer of its assets, any earnings of the successor prior to such merger, consolidation or transfer of assets and (v) the gains (but not losses) resulting from (a) the acquisition of securities issued by the Company or extinguishment of Indebtedness of the Company, (b) the sale or other disposition (including, without limitation, dispositions pursuant to sale and leaseback transactions) of any asset of the Company which is not sold or disposed of in the ordinary course of business, and (c) other extraordinary items. Notwithstanding the foregoing, in calculating Consolidated Net Income, the Company will be entitled to take into consideration the tax benefits associated with any extraordinary loss, but only to the extent such tax benefits are recognized by the Company. Consolidated Net Income will exclude any noncash losses, whether or not extraordinary, incurred in connection with the issuance of Capital Stock (other than Disqualified Stock) in exchange for Indebtedness of the Company or its Wholly Owned Subsidiaries which are Restricted Subsidiaries. "Consolidated Tangible Net Worth" of the Company as of any date means the stockholders' equity (including any Preferred Stock that is classified as equity under GAAP, other than Disqualified Stock) of the Company and its Restricted Subsidiaries on a consolidated basis at the end of the fiscal quarter immediately preceding such date, as determined in accordance with GAAP, less the amount of Intangible Assets reflected on the consolidated balance sheet of the Company and its Restricted Subsidiaries as of the end of the fiscal quarter immediately preceding such date. "Corporate Trust Office of the Trustee" will be at the address of the Trustee specified in Section 14.02 hereof or such other address as the Trustee may give notice to the Company. "Covenant Defeasance" has the meaning set forth in Section 11.03 hereof. "Custodian" means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law. "Default" means any event, act or condition that is, or after notice or the passage of time or both would be, an Event of Default. "Defaulted Interest" has the meaning set forth in Section 3.07 hereof. "Defeasance" has the meaning set forth in Section 11.02 hereof. "Defeasible Series" has the meaning set forth in Section 11.01 hereof. "Depository" means, with respect to Securities of any series issuable in whole or in part in the form of one or more Global Securities, a clearing agency registered under the 5 16 Exchange Act that is designated to act as Depository for such Securities as contemplated by Section 3.01. "Disqualified Stock" means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in whole or in part, on or prior to the final Maturity date of the Securities of any series; provided that any Capital Stock which would not constitute Disqualified Stock but for provisions thereof giving holders thereof the right to require the Company to repurchase or redeem such Capital Stock upon the occurrence of a change of control occurring prior to the final Maturity of the Securities will not constitute Disqualified Stock if the change of control provisions applicable to such Capital Stock are no more favorable to the holders of such Capital Stock than the provisions contained in Section 6.15 hereof and such Capital Stock specifically provides that the Company will not repurchase or redeem (or be required to repurchase or redeem) any such Capital Stock pursuant to such provisions prior to the Company's repurchase of Securities pursuant to Section 6.15 hereof. "Designated Senior Indebtedness" means (i) Senior Indebtedness permitted to be incurred pursuant to this Indenture under or in respect of an institutional credit agreement, including the Existing Credit Facility, and (ii) any other Senior Indebtedness permitted to be incurred pursuant to this Indenture the principal amount of which is $25,000,000 or more. "DTC" has the meaning set forth in Section 2.02 hereof. "Event of Default" has the meaning set forth in Section 8.01(a) hereof. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "Existing Credit Facility" means the Amended and Restated Credit Agreement, dated as of May 28, 1997, between the Company and the lenders named therein and The First National Bank of Chicago, as Agent (together with the documents related thereto (including, without limitation, any guaranty agreements)), as such Facility may be amended, restated, supplemented or otherwise modified from time to time, and includes any facility extending the maturity of, increasing the total commitment of, or restructuring (including, without limitation, the inclusion of additional borrowers thereunder that are Subsidiaries of the Company and whose obligations thereunder are guaranteed by the Company) all or any portion of, the Indebtedness under such Facility or any successor or replacement facilities and includes any facility with one or more agents or lenders refinancing or replacing all or any portion of the Indebtedness under such Facility or any successor facilities. 6 17 "Existing Indebtedness" means all of the Indebtedness of the Company and its Subsidiaries that is outstanding on the Issue Date of Securities of any series. "Fair Market Value" with respect to any asset or property means the sale value that would be obtained in an arm's-length transaction between an informed and willing seller under no compulsion to sell and an informed and willing buyer under no compulsion to buy. "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States, as in effect on the Issue Date of the Securities of any series. "Global Security" means a Security that evidences all or part of the Securities of any series and is authenticated and delivered to, and registered in the name of, the Depository for such Securities or a nominee thereof. "Hedging Obligations" of any Person means the obligations of such Person pursuant to any interest rate swap agreement, foreign currency exchange agreement, interest rate collar agreement, option or futures contract or other similar agreement or arrangement relating to interest rates or foreign exchange rates. "Holder" means a Person in whose name a Security is registered. "Incur" means to, directly or indirectly, create, incur, assume, guaranty, extend the maturity of, or otherwise become liable with respect to any Indebtedness. "Indebtedness" of any Person at any date means, without duplication, (i) all indebtedness of such Person for borrowed money (whether or not the recourse of the lender is to the whole of the assets of such Person or only to a portion thereof), (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person in respect of letters of credit or other similar instruments (or reimbursement obligations with respect thereto), other than standby letters of credit issued for the benefit of, or surety and performance bonds issued by, such Person in the ordinary course of business, (iv) all obligations of such Person with respect to Hedging Obligations (other than those that fix or cap the interest rate on variable rate indebtedness otherwise permitted by this Indenture or that fix the exchange rate in connection with indebtedness denominated in a foreign currency and otherwise permitted by this Indenture and other than the purchase of mortgage commitments in the ordinary course of business), (v) all obligations of such Person to pay the deferred and unpaid purchase price of property or services, including, without limitation, all conditional sale obligations of such Person and all obligations under any title retention agreement (except trade payables and 7 18 accrued expenses incurred in the ordinary course of business), (vi) all Capitalized Lease Obligations of such Person, (vii) all indebtedness of others secured by a Lien on any asset of such Person, whether or not such indebtedness is assumed by such Person, (viii) all indebtedness of others guaranteed by, or otherwise the liability of, such Person to the extent of such guaranty or liability, and (ix) all Disqualified Stock issued by such Person (the amount of indebtedness represented by any Disqualified Stock will equal the greater of the voluntary or involuntary liquidation preference plus accrued and unpaid dividends). The amount of indebtedness of any Person at any date will be (a) the outstanding balance at such date of all unconditional obligations as described above, (b) the maximum liability of such Person for any contingent obligations under clause (v) above and (c) in the case of clause (vii) (if the indebtedness referred to therein is not assumed by such Person), the lesser of the (A) Fair Market Value of all assets subject to a Lien securing the indebtedness of others on the date that the Lien attaches and (B) amount of the indebtedness secured. "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, including, for all purposes of this instrument, and any such supplemental indenture, the provisions of the TIA that are deemed to be a part of and govern this instrument and any such supplemental indenture, respectively. The term "Indenture" shall also include the terms of particular series of Securities established as contemplated by Section 3.01 hereof upon receipt by the Trustee of an Opinion of Counsel in accordance with Section 3.03 hereof. "Independent Financial Advisor" means an accounting, appraisal or investment banking firm of nationally recognized standing that is, in the reasonable judgment of the Company's Board of Directors, (i) qualified to perform the task for which it has been engaged, and (ii) disinterested and independent with respect to the Company, all of its Subsidiaries, and each Affiliate of the Company and/or its Subsidiaries that is involved in the Affiliate Transaction with respect to which such firm has been engaged. "Intangible Assets" of the Company means all unamortized debt discount and expense, unamortized deferred charges, goodwill, patents, trademarks, service marks, trade names, copyrights, write-ups of assets over their carrying value at the end of the last fiscal quarter ended prior to the Issue Date of the Securities of any series or the date of acquisition, if acquired subsequent thereto, and all other items which would be treated as intangibles on the consolidated balance sheet of the Company and its Restricted Subsidiaries prepared in accordance with GAAP. "Interest Payment Date", when used with respect to a Security of any series, means the Stated Maturity of an installment of interest on such Security. 8 19 "Investments" of any Person means (i) all investments by such Person in any other Person in the form of loans, advances or capital contributions, (ii) all guaranties of Indebtedness or other obligations of any other Person by such Person, (iii) all purchases (or other acquisitions for consideration) by such Person of Indebtedness, Capital Stock or other securities of any other Person and (iv) all other items that would be classified as investments (including, without limitation, purchases of assets outside the ordinary course of business) on a balance sheet of such Person determined in accordance with GAAP. "Issue Date" means the date of original issuance of the Securities of each series established pursuant to Section 3.01 hereof. "Legal Holiday" means Saturday, Sunday or a day on which banking institutions in New York, New York or at a Place of Payment are authorized or obligated by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday at a Place of Payment, payment shall be made at that place on the next succeeding day that is not a Legal Holiday and no interest shall accrue for the intervening period. "Lien" means with respect to any asset, any mortgage, lien, pledge, charge, security interest or other similar encumbrance of any kind upon or in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law (including, without limitation, any conditional sale or other title retention agreement, and any lease in the nature thereof, any option or other agreement to sell, and any filing of, or agreement to give, any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction). "Material Subsidiary" has the meaning set forth in the Indenture, dated as of June 21, 1993, between the Company and IBJ Schroder Bank & Trust Company, as trustee, relating to the Company's 9-3/4% Senior Notes due 2003 as in effect on the date hereof. "Maturity", when used with respect to a Security of any series, means the date on which the principal of such Security or an installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise. "Net Worth Amount" has the meaning set forth in Section 6.17(a) hereof. "Net Worth Offer" has the meaning set forth in Section 6.17(a) hereof. "Net Worth Offer Date" has the meaning set forth in Section 6.17(a) hereof. "Net Worth Offer Price" has the meaning set forth in Section 6.17(a) hereof. 9 20 "Non-Recourse Indebtedness" means Indebtedness of the Company or a Restricted Subsidiary for which (i) the sole legal recourse for collection of principal and interest on such Indebtedness is against the specific property identified in the instruments evidencing or securing such Indebtedness and such property was acquired with the proceeds of such Indebtedness or such Indebtedness was Incurred within 90 days after the acquisition of such property and (ii) no other assets of the Company or such Restricted Subsidiary may be realized upon in collection of principal or interest on such Indebtedness. "Officer" means the Chairman of the Board, the President, the Senior Vice President, the Treasurer, any Assistant Treasurer, the Controller, the Secretary, any Assistant Secretary or any Vice President of a Person. "Officers' Certificate" means a certificate signed by two Officers, one of whom must be the Person's Chief Executive Officer (or Co-Chief Executive Officer), Chief Operating Officer, Chief Financial Officer or Chief Accounting Officer. "Opinion of Counsel" means an opinion from legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or the Trustee. "Outstanding", when used with respect to Securities, 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 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; (iii) Securities as to which the Defeasance has been effected pursuant to Section 11.02 hereof; and (iv) Securities which have been paid pursuant to Section 3.06 or in exchange for or in lieu of which other Securities has 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 10 21 such Securities are held by a bona fide purchaser in whose hands such Securities are valid obligations of the Company; provided, however, that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, (a) the principal amount of a Security denominated in one or more foreign currencies or currency units shall be the U.S. dollar equivalent, determined in the manner provided as contemplated by Section 3.01 hereof on the Issue Date of such Security, of the principal amount of such Security, and (b) Securities owned by the Company or any other obligor of the Securities or any Subsidiary 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 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 Subsidiary of the Company or of such other obligor. "Paying Agent" means any Person, including the Company, authorized by the Company to pay the principal of or any interest on any Securities of any series. "Permitted Investment" of any Person means any Investment of such Person in (i) direct obligations of the United States or any agency thereof or obligations guaranteed by the United States or any agency thereof, in each case maturing within 180 days of the date of acquisition thereof, (ii) certificates of deposit maturing within 180 days of the date of acquisition thereof issued by a bank, trust company or savings and loan association which is organized under the laws of the United States or any state thereof having capital, surplus and undivided profits aggregating in excess of $250 million and a Keefe Bank Watch Rating of C or better (or a similar rating by any successor thereof), (iii) certificates of deposit maturing within 180 days of the date of acquisition thereof issued by a bank, trust company or savings and loan association organized under the laws of the United States or any state thereof other than banks, trust companies or savings and loan associations satisfying the criteria in (ii) above; provided that the aggregate amount of all certificates of deposit issued to the Company at any one time by such bank, trust company or savings and loan association will not exceed $100,000, (iv) commercial paper given the highest rating by two established national credit rating agencies and maturing not more than 180 days from the date of the acquisition thereof, (v) repurchase agreements or money-market accounts which are fully secured by direct obligations of the United States or any agency thereof and (vi) in the case of the Company and its Subsidiaries, any receivables or loans taken by the Company or a Subsidiary in connection with the sale of any asset otherwise permitted by this Indenture. 11 22 "Person" means any individual, corporation, partnership, joint venture, limited liability company, incorporated or unincorporated association, joint stock company, trust, unincorporated organization or government or other agency or political subdivision thereof or other entity of any kind. "Place of Payment", when used with respect to the Securities of any series, means the place or places where the principal of and interest on the Securities of that series are payable as specified as contemplated by Section 3.01 hereof. "Preferred Stock" of any Person means all Capital Stock of such Person which has a preference in liquidation or with respect to the payment of dividends. "Refinancing Indebtedness" means Indebtedness that refunds, refinances or extends any Existing Indebtedness or other Indebtedness permitted to be Incurred by the Company or its Restricted Subsidiaries pursuant to the terms of this Indenture, but only to the extent that (i) the Refinancing Indebtedness is subordinated to the Securities of any series to the same extent as the Indebtedness being refunded, refinanced or extended, if at all, (ii) the Refinancing Indebtedness is scheduled to mature either (a) no earlier than the Indebtedness being refunded, refinanced or extended, or (b) after the maturity date of the Securities of such series, (iii) the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or prior to the Maturity date of the Securities of such series has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is Incurred that is equal to or greater than the Weighted Average Life to Maturity of the portion of the Indebtedness being refunded, refinanced or extended that is scheduled to mature on or prior to the maturity date of the Securities of such series, (iv) such Refinancing Indebtedness is in an aggregate amount that is equal to or less than the aggregate amount then outstanding under the Indebtedness being refunded, refinanced or extended, (v) such Refinancing Indebtedness is Incurred by the same Person that initially Incurred the Indebtedness being refunded, refinanced or extended, except that the Company may Incur Refinancing Indebtedness to refund, refinance or extend Indebtedness of any Restricted Subsidiary and (vi) such Refinancing Indebtedness is Incurred within 180 days before or after the Indebtedness being refunded, refinanced or extended is so refunded, refinanced or extended; provided that Refinancing Indebtedness shall include the amount of any Indebtedness under the Existing Credit Facility which is Incurred within 180 days before or after the repayment of an equal amount of Indebtedness under the Existing Credit Facility which was Incurred pursuant to Section 6.13(a) hereof. "Registrar" has the meaning set forth in Section 3.05 hereof. 12 23 "Regular Record Date" for the interest payable on any Security of any series on any Interest Payment Date means the date specified for that purpose as contemplated by Section 3.01 hereof. "Restricted Investment" with respect to any Person means any Investment (other than any Permitted Investment) by such Person in any (i) of its Affiliates, (ii) executive officer or director of any Affiliate of such Person, or (iii) other Person other than a Restricted Subsidiary which is a Wholly Owned Subsidiary of the referent Person; provided, however, that with respect to the Company and its Restricted Subsidiaries, any loan or advance to an executive officer or director of the Company or a Subsidiary will not constitute a Restricted Investment provided such loan or advance is made in the ordinary course of business consistent with past practices, and, if such loan or advance exceeds $100,000 (other than a readily marketable mortgage loan not exceeding $500,000), such loan or advance has been approved by the Board of Directors of the Company or a disinterested committee thereof. "Restricted Payment" with respect to any Person means (i) the declaration of any dividend or the making of any other payment or distribution of cash, securities or other property or assets in respect of such Person's Capital Stock (except that a dividend payable solely in Capital Stock (other than Disqualified Stock) of such Person will not constitute a Restricted Payment), (ii) any payment on account of the purchase, redemption, retirement or other acquisition for value of such Person's Capital Stock or any other payment or distribution made in respect thereof (other than payments or distributions excluded from the definitions of Restricted Payment in clause (i) above), either directly or indirectly, (iii) any Restricted Investment and (iv) any principal payment, redemption, repurchase, defeasances or other acquisition or retirement of any Indebtedness of any Unrestricted Subsidiary or of Indebtedness of the Company or its Restricted Subsidiaries which is subordinated in right of payment to the Securities of any series (provided, however, that the payment, redemption, repurchase, defeasance or other acquisition or retirement of any such subordinated Indebtedness by the Company or any Restricted Subsidiary on its scheduled final maturity date or on any other scheduled date for the payment of any installment of principal thereof (whether pursuant to a sinking fund, mandatory redemption or otherwise) shall not be a Restricted Payment); provided, further, that with respect to the Company and its Subsidiaries, Restricted Payments will not include (a) any payment or other obligation described in clause (i), (ii) or (iii) above made to, or on behalf or for the benefit of, the Company or any of its Restricted Subsidiaries which are Wholly Owned Subsidiaries by any of the Company's Subsidiaries, or (b) any proportionate payment in respect of minority interests in Restricted Subsidiaries of the Company to the extent that the payment constitutes a return of capital that was not included in the Company's shareholders' equity or a dividend or similar distribution not included in determining the Company's Consolidated Net Income, or (c) any principal payment, redemption, repurchase, defeasance or other acquisition or retirement of Indebtedness of the Company or its Restricted Subsidiaries which is subordinated to the Offered Debt Securities if the consideration therefor consists solely of, or is the proceeds from, Indebtedness subordinated to the Offered Debt Securities to the same extent as the Indebtedness being paid, redeemed, repurchased, defeased or otherwise acquired or retired, or (d) any principal payment, redemption, repurchase, defeasance or other acquisition or retirement of Indebtedness or Capital Stock of such Person or its Subsidiaries if the consideration therefor consists solely of Capital Stock (other than Disqualified Stock) of such Person, or the proceeds from such sale of such Capital Stock, or (e) any loans or advances by the Company or 13 24 any Restricted Subsidiary to Unrestricted Subsidiaries which in an aggregate amount at any one time outstanding do not exceed $50,000,000. "Restricted Subsidiary" means each of the Subsidiaries of the Company which is not an Unrestricted Subsidiary. "SEC" means the Securities and Exchange Commission, and any successor thereto. "Securities" has the meaning set forth in the first recital of this Indenture and more particularly means any securities of any series authenticated and delivered under this Indenture. "Security Register" has the meaning set forth in Section 3.05 hereof. "Senior Indebtedness" means the principal of (premium, if any) and interest on (including, without limitation, interest accruing subsequent to the filing of a petition under applicable Bankruptcy Law or the appointment of a Custodian), (i) any and all indebtedness and obligations of the Company (including indebtedness of others guaranteed by the Company), whether or not contingent and whether or not outstanding on the Issue Date of the Securities of any series or thereafter created, incurred or assumed, including, without limitation, all charges, fees, expenses (including, without limitation, reasonable attorneys' fees and expenses and other amounts incurred by or owing to holders of such indebtedness), which (a) is for money borrowed, (b) is evidenced by any bond, note, debenture or similar instrument, (c) represents the unpaid balance on the purchase price of any property, business or asset of any kind, (d) is a Capitalized Lease Obligation, (e) is a reimbursement obligation of the Company with respect to letters of credit, (f) is an obligation of the Company with respect to an interest swap obligation or a foreign exchange agreement or (g) is an obligation of another secured by a Lien to which any of the properties or assets (including, without limitation, leasehold interests and any other tangible or intangible property rights) of the Company are subject, whether or not the obligation secured thereby will have been assumed by the Company or will otherwise be the Company's legal liability and (ii) any deferrals, amendments, renewals, extensions, modifications and refundings of any indebtedness or obligations of the types referred to above; provided that Senior Indebtedness will not include (A) (x) the Securities of any series or (y) the Company's 4-7/8% Convertible Subordinated Debentures due 2005, (B) any indebtedness or obligation of the Company (or the instrument creating or evidencing it) which expressly provides that such indebtedness is not superior in right of payment to the Securities of any series or which expressly provides that such indebtedness is subordinate in right of payment to all other indebtedness of the Company (including the Securities of any series), (C) any indebtedness or obligation of the Company to any of its Subsidiaries and (D) any indebtedness or obligation incurred by the Company in connection with the purchase of assets, materials or services in the ordinary course of business and which constitutes a trade payable. 14 25 "Special Record Date" for the payment of any Defaulted Interest on any Security means a date fixed by the Trustee pursuant to Section 3.07 hereof. "Stated Maturity", when used with respect to any Security of any series 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. "Subsidiary" of any Person means (i) any corporation of which at least a majority of the aggregate voting power of all classes of the Common Equity is directly or indirectly beneficially owned by such Person, and (ii) any entity other than a corporation of which such Person directly or indirectly beneficially owns at least a majority of the Common Equity. "Successor" has the meaning set forth in Section 7.01(a) hereof. "TIA" means the Trust Indenture Act of 1939, as amended. "Trustee" means the Person named as the "Trustee" in the first paragraph of the Indenture until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Trustee" shall mean or include the Person who is then the Trustee hereunder. "Trust Officer" means any Senior Vice President, Vice President, Assistant Vice President, Assistant Secretary or Assistant Treasurer of the Trustee assigned by the Trustee to administer its corporate trust matters. "U.S. Government Obligations" means (i) any security that is (a) a direct obligation of the United States for the payment of which the full faith and credit of the United States is pledged or (b) an obligation of a Person controlled or supervised by and acting as an agency or instrumentality of the United States the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States, which, in either case (a) or (b), is not callable or redeemable at the option of the issuer thereof, and (ii) any depositary 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 U.S. Government Obligation specified in clause (i) and held by such custodian for the account of the holder of such depositary receipt, or with respect to any specific payment of principal of or interest on any such U.S. Government Obligation; 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 depositary receipt from any amount received by the custodian in respect of the U.S. Government Obligation or the specific payment of principal or interest evidenced by such depositary receipt. 15 26 "Unrestricted Subsidiary" means each of the Subsidiaries of the Company so designated by a Board Resolution. The Board of Directors of the Company may designate an Unrestricted Subsidiary to be a Restricted Subsidiary; provided that (i) any such redesignation will be deemed to be an Incurrence by the Company and its Restricted Subsidiaries of the Indebtedness (if any) of such redesignated Subsidiary for purposes of the covenant set forth in Section 6.13 hereof as of the date of such redesignation and (ii) immediately after giving effect to such redesignation and the Incurrence of any such additional Indebtedness, the Company and its Restricted Subsidiaries could Incur $1.00 of additional Indebtedness under the ratio of the Company's Indebtedness (excluding Non-Recourse Indebtedness) to Consolidated Tangible Net Worth contained in the covenant set forth in Section 6.13(a) hereof. Subject to the foregoing, the Board of Directors of the Company may designate any Restricted Subsidiary to be an Unrestricted Subsidiary; provided that (i) all previous Investments by the Company and its Restricted Subsidiaries in such Restricted Subsidiary will be deemed to be Restricted Payments at the time of such designation and will reduce the amount available for Restricted Payments under the covenant set forth in Section 6.12 hereof and (ii) immediately after giving effect to such designation and reduction of amounts available for Restricted Payments under the covenant set forth in Section 6.12 hereof, the Company and its Restricted Subsidiaries could Incur $1.00 of additional Indebtedness under the ratio of the Company's Indebtedness (excluding Non-Recourse Indebtedness) to Consolidated Tangible Net Worth contained in the covenant set forth in Section 6.13(a) hereof. Any such designation or redesignation by the Board of Directors of the Company will be evidenced to the Trustee by the filing with the Trustee of a Board Resolution giving effect to such designation or redesignation and an Officers' Certificate certifying that such designation or redesignation complied with the foregoing conditions and setting forth the underlying calculations of such Officers' Certificate. "Weighted Average Life to Maturity" means, when applied to any Indebtedness or portion thereof, at any date, the number of years obtained by dividing (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal, including, without limitation, payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment by (ii) the then outstanding principal amount of such Indebtedness or portion thereof. "Wholly Owned Subsidiary" of any Person means (i) a Subsidiary, of which 100 percent of the Common Equity (except for directors' qualifying shares or certain minority interests owned by other Persons solely due to local law requirements that there be more than one stockholder, but which interest is not in excess of what is required for such purpose) is owned directly by such Person or through one or more other Wholly Owned Subsidiaries of such Person, or (ii) any entity other than a corporation in which such Person, directly or indirectly, owns all of the Common Equity of such entity. 16 27 SECTION 1.03 INCORPORATION BY REFERENCE OF TIA Whenever this Indenture refers to a provision of the TIA, such provision is incorporated by reference in and made a part of this Indenture. ARTICLE 2 SECURITY FORMS SECTION 2.01 FORMS GENERALLY Each Security and Global Security issued pursuant to this Indenture shall be in substantially the form established by or pursuant to an Officers' Certificate or a Board Resolution or in one or more indentures supplemental hereto, shall have such appropriate insertions, omissions, substitutions and other variations as are required or permitted by or pursuant to this Indenture or any indenture supplemental hereto and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may, consistent herewith, be determined by the Officers executing such Security as evidenced by their execution of such Security. If temporary Securities of any series are issued as Global Securities as permitted by Section 3.04 hereof, the form thereof shall also be established as provided in the previous sentence. If the form of Securities of any series is established by action taken pursuant to an Officers' Certificate or a Board Resolution, a copy thereof shall be delivered to the Trustee at or prior to the delivery of the Company Order contemplated by Section 3.03 hereof for the authentication and delivery of such Securities. If all of the Securities of any series established by action taken pursuant to an Officers' Certificate or a Board Resolution are not to be issued at one time, it shall not be necessary to deliver a copy thereof at the time of issuance of each Security of such series, but such Officers' Certificate or Board Resolution shall be delivered at or prior to the time of issuance of the first Security of such series. Securities shall be printed, lithographed or engraved or produced by any combination of these methods or may be produced in any other manner, all as determined by the Officers of the Company executing such Securities, as evidenced by their execution of such Securities. SECTION 2.02 FORM OF LEGEND FOR GLOBAL SECURITIES Every Global Security authenticated and delivered hereunder shall 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 DEPOSITORY OR A NOMINEE OF A 17 28 DEPOSITORY. THIS GLOBAL 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 SUCH LIMITED CIRCUMSTANCES. EVERY SECURITY DELIVERED UPON REGISTRATION OF TRANSFER OF, OR IN EXCHANGE FOR, OR IN LIEU OF, THIS GLOBAL SECURITY SHALL BE A GLOBAL SECURITY SUBJECT TO THE FOREGOING, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED ABOVE. UNLESS THIS CERTIFICATE 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 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 TO BE 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. SECTION 2.03 FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION The Trustee's certificate of authentication shall be in substantially the following form: This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. [Name of Trustee] As Trustee By....................................... Authorized Officer 18 29 ARTICLE 3 THE SECURITIES SECTION 3.01 AMOUNT UNLIMITED; ISSUABLE IN SERIES 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 and the Securities of each such series shall rank equally and pari passu with the Securities of each other series, but all Securities issued hereunder shall be subordinated and junior in right of payment, to the extent and in the manner set forth in Article 16, to all Senior Indebtedness of the Company. There shall be established in or pursuant to a Board Resolution and, set forth, or determined in the manner provided, in an Officers' Certificate, or established in one or more indentures supplemental hereto, which, in each case, shall be deemed incorporated herein by this reference and made a part hereof but only with respect to the series of Securities established pursuant to such Board Resolution, Officers' Certificate or supplemental indenture, prior to the issuance of Securities of any series of the following: (1) the title of the Securities of the series (which shall distinguish the Securities of the series from Securities of any other series); (2) any limit upon the aggregate principal amount of the Securities of the series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Section 3.04, 3.05, 3.06, 4.07 or 13.05 hereof and except for any Securities which, pursuant to Section 3.03 hereof, are deemed never to have been authenticated and delivered hereunder); (3) the Person to whom any interest on a Security of the series shall be payable, if other than the Person in whose name that Security is registered at the close of business on the Regular Record Date for such interest; (4) the date or dates, or the method by which such date or dates will be determined, on which the principal of the Securities of the series is payable; (5) the rate or rates at which the Securities of the series shall bear interest, if any, or the method by which such rate or rates shall be determined, the date or dates from which such interest shall accrue, or the method by which such date or dates shall be determined, the Interest Payment Dates on which any such interest shall be payable and the Regular Record Date, if any, for the interest payable on any Security on any Interest Payment Date, or the method by which such date or dates shall be determined, and the basis upon which interest shall be 19 30 calculated if other than on the basis of actual days elapsed over a 365 or 366-day year; (6) the place or places, if any, other than or in addition to New York, New York, where the principal of and interest on Securities of the series shall be payable, any Securities of the series may be surrendered for registration of transfer, Securities of the same series may be surrendered for exchange and, if different from the location specified in Section 14.02 hereof, the place or places where notices or demands to or upon the Company in respect of the Securities of the series and this Indenture may be served; (7) the period or periods within, the price or prices at and the terms and conditions upon, which Securities of the series may be redeemed or purchased, in whole or in part, at the option of the Company; (8) the obligation, if any, of the Company to redeem or repurchase Securities of the series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of the series shall be redeemed or repurchased, in whole or in part, pursuant to such obligation; (9) if other than denominations of $1,000 and any integral multiple thereof, the denominations in which Securities of the series shall be issuable; (10) the currency, currencies or currency units in which payment of the principal of and interest on any Securities of the series shall be payable if other than the currency of the United States and the manner of determining the equivalent thereof in the currency of the United States for purposes of the definition of "Outstanding" in Section 1.01 hereof; (11) if the principal of or interest on any Securities of the series is to be payable, at the election of the Company or a Holder thereof, in one or more currencies or currency units other than that or those in which the Securities are stated to be payable, the currency, currencies or currency units in which payment of the principal of and interest on Securities of such series as to which such election is made shall be payable, and the periods within which and the terms and conditions upon which such election is to be made; (12) if the amount of payments of principal of or interest on any Securities of the series may be determined with reference to an index, the manner in which such amounts shall be determined; 20 31 (13) if other than the principal amount of the Securities of any series, the portion of the principal amount of such Securities which shall be payable upon declaration of acceleration of the Maturity thereof; (14) if applicable, that the Securities of the series shall be defeasible as provided in Article 11 hereof; (15) if and as applicable, that the Securities of the series shall be issuable in whole or in part in the form of one or more Global Securities and, in such case, the Depository or Depositories for such Global Security or Global Securities and any circumstances other than those set forth in Section 3.05 hereof in which any such Global Security may be transferred to, and registered and exchanged for Securities registered in the name of, a Person other than the Depository for such Global Security or a nominee thereof and in which any such transfer may be registered; (16) any deletions from, modifications of or additions to the Events of Default or covenants of the Company with respect to Securities of any series, whether or not such Events of Default or covenants are consistent with the Events of Default or covenants set forth herein; (17) if other than the Trustee, the identity of each Paying Agent and Registrar for the Securities of the series; and (18) any other terms of the series. All Securities of any one series shall be substantially identical except as to denomination and except as may otherwise be provided in or pursuant to the Board Resolution referred to above and set forth, or determined in the manner provided, in the Officers' Certificate referred to above 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 thereof shall be delivered to the Trustee at or prior to the delivery of the Officers' Certificate setting forth the terms of the series. SECTION 3.02 DENOMINATIONS In the absence of any specified denomination with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $1,000 and any integral multiple thereof. SECTION 3.03 EXECUTION, AUTHENTICATION, DELIVERY AND DATING 21 32 The Securities shall be executed on behalf of the Company by two Officers, under its corporate seal reproduced thereon. The signature of any of the Officers on the Securities may be manual or by facsimile. Securities bearing the manual or facsimile signatures of individuals who were at any time the proper Officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the date of such Securities. At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series, executed by the Company to the Trustee for authentication, together with a Company Order for the authentication and delivery of such Securities, and the Trustee in accordance with the Company Order shall authenticate and deliver such Securities. The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Securities. An authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such an agent. An authenticating agent has the same rights as an Agent to deal with the Company. The Company shall pay the reasonable fees and expenses of any authenticating agent. If the form or terms of the Securities of the series have been established in or pursuant to one or more Officers' Certificate or Board Resolutions as permitted by Sections 2.01 and 3.01 hereof, in authenticating such Securities, and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, and (subject to TIA Sections 315(a) through 315(d)) shall be fully protected in relying upon, an Opinion of Counsel stating: (1) if the form or forms of such Securities have been established by or pursuant to Board Resolution or an Officers' Certificate as permitted by Section 2.01 hereof, that such form or forms have been established in conformity with the provisions of this Indenture; (2) if the terms of such Securities have been established by or pursuant to an Officers' Certificate or a Board Resolution as permitted by Section 3.01 hereof, that such terms have been established in conformity with the provisions of this Indenture; and (3) that such Securities, 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 and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute the 22 33 legal, valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors' rights, to general equity principles and to such other qualifications as such counsel shall conclude do not materially affect the rights of Holders of such Securities. Notwithstanding the provisions of Section 3.01 hereof and of the preceding paragraph, if all of the Securities of any series are not to be issued at one time, it shall not be necessary to deliver the Officers' Certificate or Board Resolution otherwise required pursuant to Section 3.01 hereof or the Company Order and Opinion of Counsel otherwise required pursuant to such preceding paragraph at the time of issuance of each Security of such series, but such documents shall be delivered at or prior to the time of issuance of the first Security of such series. Notwithstanding the immediately preceding sentence, any subsequent request by the Company to the Trustee to authenticate Securities of such series upon original issuance shall constitute a representation and warranty by the Company that, as of the date of such request, the statements made in the Opinion of Counsel delivered pursuant to this Section 3.03 shall be true and correct as if made on such date. The Trustee shall have the right to decline to authenticate and deliver such Securities if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith by its board of directors or trustees, executive committee or a trust committee of directors or trustees and/or officers of the Trustee shall determine that such action would expose the Trustee to personal liability to existing Holders or would adversely affect the Trustee's own rights, duties or immunities under this Indenture or otherwise. 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 duly executed by the Trustee by manual signature of an authorized signatory, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder and is entitled to the benefits of this Indenture. 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 3.09 hereof together with a Company Order (which need not comply with Section 14.08 hereof and need not be accompanied by an Opinion of Counsel) stating that such Security has never been issued or sold by the Company, for all purposes of this Indenture such Security shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled to the benefits of this Indenture. 23 34 SECTION 3.04 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 authorized denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued, and with such appropriate insertions, omissions, substitutions and other variations as the Officers executing such Securities may determine, as evidenced by their execution of such Securities. Every temporary Security shall be executed by the Company and authenticated by the Trustee and registered by the Registrar, upon the same conditions, and with like effect, as a definitive Security. If temporary Securities (other than a Global Security) of any series are issued, the Company will cause definitive Securities of that series to be prepared without unreasonable delay. After the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities of any series, the Company shall execute and the Trustee shall authenticate and deliver in exchange a like aggregate principal amount of definitive Securities of the same series of authorized denominations. Until so exchanged, the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series. SECTION 3.05 REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE (a) The Company shall maintain a register of the Securities of each series including any Global Security (the "Security Register") in an office or agency of the Company in a Place of Payment (the "Registrar") where, subject to Section 3.05(c) hereof and such reasonable regulations as the Company may prescribe, Securities may be presented for registration of transfer or for exchange. The Company may appoint one or more co-Registrars. The term "Registrar" includes any co-Registrar. The Company may change any Registrar without notice to any Holder. The Company or any of its Subsidiaries may act as Registrar. Subject to Section 3.05(c), upon surrender for registration of transfer of any Security of any series at the office or agency of the Company in a Place of Payment for that series, 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 aggregate principal amount. 24 35 Subject to Section 3.05(c), at the option of the Holder, Securities of any series may be exchanged for other Securities of the same series, of any authorized denominations and of a like aggregate principal amount, 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 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 Registrar) be duly endorsed, or be accompanied by a written instrument of transfer, in form satisfactory to the Company and the Registrar, duly executed by the Holder thereof or its attorney duly authorized in writing. No service charge shall be made for any registration of 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 registration of transfer or exchange of Securities, other than exchanges pursuant to Section 3.04, 4.07 or 13.05 hereof not involving any transfer. The Company shall not be required (i) to issue, register the transfer of or exchange Securities of any series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of Securities of that series selected for redemption under Section 4.08 hereof and ending at the close of business on the day of such mailing, or (ii) to register the transfer or exchange of any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part, or (iii) to issue, register the transfer of or exchange any Security which has been surrendered for repayment at the option of the Holder, except the portion, if any, of such Security not to be so repaid. (b) In case the Company, pursuant to Article 7 hereof, will be consolidated or merged with or into any other Person or will convey, transfer or lease substantially all of its properties and assets to any Person, and the Successor resulting from such consolidation, or surviving such merger, or into which the Company will have been merged, or the Person which will have received a conveyance, transfer or lease as aforesaid, will have executed an indenture supplemental hereto with the Trustee pursuant to Article 7 hereof, any of the Securities authenticated or delivered prior to such consolidation, merger, conveyance, transfer or lease may, from time to time, at the request of the Successor, be exchanged for other Securities executed in the name of the Successor with such changes in phraseology and form as may be appropriate, but 25 36 otherwise in substance and of like tenor as the Securities surrendered for such exchange and of like principal amount; and the Trustee, upon receipt of an Officers' Certificate from the Successor, will authenticate and deliver Securities as specified in such request for the purpose of such exchange. If Securities will at any time be authenticated and delivered in any new name of a Successor pursuant to this Section 3.05(b) hereof in exchange or substitution for or upon registration of transfer of any Securities, such Successor, at the option of the Holders but without expense to them, will provide for the exchange of all Securities at the time outstanding for Securities authenticated and delivered in such new name. (c) The Company will execute and the Trustee will, in accordance with this Section 3.05(c) for so long as the Securities of any series are to be issued in whole or in part in the form of one or more Global Securities, authenticate and deliver one or more Global Securities that will (i) represent and will be denominated in an amount equal to the aggregate outstanding principal amount of the Securities to be represented by such Global Security or Securities, (ii) be registered in the name of the Depository for such Global Security or Securities or the nominee of such Depository, (iii) be delivered by the Trustee to such Depository or pursuant to such Depository's instructions and (iv) bear the legends set forth in Section 2.02 hereof. Each Depository appointed in accordance with Section 3.01 hereof for a Global Security must, at the time of its appointment and at all times while it serves as Depository, be a clearing agency registered under the Exchange Act, and any other applicable statute or regulation. Notwithstanding any other provision of this Section 3.05(c), unless and until it is exchanged in whole for Securities in definitive form of any series, a Global Security representing all or a portion of the Securities of any series may not be transferred except as a whole by the Depository to a nominee of such Depository or by a nominee of such Depository to such Depository or another nominee of such Depository or by such Depository or any such nominee to a successor Depository or a nominee of such successor Depository. If at any time the Depository is unwilling or unable to continue as Depository or if at any time the Depository will no longer be eligible to act as such under this Section 3.05(c), the Company will appoint a successor Depository. If (i) a successor Depository is not appointed by the Company within 90 days after the Company receives notice from the Depository or otherwise becomes aware of such unwillingness, inability or ineligibility or (ii) an Event of Default has occurred and is continuing, the Company will execute and deliver to the Trustee as promptly as practicable Securities in definitive form, together with an Officers' Certificate relating to the authentication and delivery of such Securities, and the Trustee, as promptly as practicable after the receipt of such Securities and Officers' Certificate, will authenticate and deliver Securities in definitive form in an aggregate principal amount equal to the principal amount of, and containing terms and provisions identical to, the Global Security or Securities in exchange for such Global Security or Securities. 26 37 The Company may at any time and in its sole discretion determine that the Securities of any series issued in the form of one or more Global Securities will no longer be represented by such Global Security or Securities. In such event, the Company will execute and deliver to the Trustee Securities in definitive form, together with an Officers' Certificate relating to the authentication and delivery of Securities in definitive form, and the Trustee, as promptly as practicable after the receipt of such Securities in definitive form and Officers' Certificate, will authenticate and deliver Securities in definitive form in an aggregate principal amount equal to the principal amount of, and containing terms and provisions identical to, the Global Security or Securities in exchange for such Global Security or Securities. Upon the exchange of a Global Security in whole or in part for Securities in definitive form, such Global Security shall be cancelled by the Trustee. Securities in definitive form issued in exchange for a Global Security pursuant to this Section 3.05(c) will be registered in such names and in such authorized denominations as the Depository, pursuant to instructions from its direct or indirect participants or otherwise, will instruct the Trustee in writing. The Trustee will deliver such Securities in definitive form to the Persons in whose names such Securities are so registered or as it may otherwise be directed by the Depository. Upon the exchange of less than the entire principal amount of a Global Security for Securities in definitive form, the Company will also execute, and the Trustee, upon receipt of an Officers' Certificate will also authenticate and deliver, a new Global Security in aggregate principal amount equal to the difference between the principal amount of the surrendered Global Security and the aggregate principal amount of Securities in definitive form issuable upon such exchange. In any exchange provided for in any of the preceding three paragraphs, the Company will execute and the Trustee will authenticate and deliver Securities in definitive form in authorized denominations. If a Security in definitive form is issued in exchange for any portion of a Global Security after the close of business at the office or agency where such exchange occurs on or after any Regular Record Date for an Interest Payment Date and before the opening of business at such office or agency on the next Interest Payment Date, interest will not be payable on such Interest Payment Date or proposed date for payment, as the case may be, in respect of such Security in definitive form, but will be payable on such Interest Payment Date only to the Person to whom interest in respect of such portion of such Global Security is payable in accordance with the provisions of this Indenture. None of the Company, the Trustee, any agent of the Trustee, any Paying Agent or the Registrar will have any responsibility or liability for any aspect of the Depository's records relating to or payments made on account of beneficial ownership interests in a Global Security or for maintaining, supervising or reviewing any of the Depository's records relating to such beneficial ownership interests. 27 38 SECTION 3.06 MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES If any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new Security of the same series and of like principal amount and bearing a number not contemporaneously outstanding. If there shall be delivered to the Company and 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 and 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 Company shall execute and upon receipt of a Company Order the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Security, a new Security of the same series and of like principal amount 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, instruct the Paying Agent to pay such Security. Upon the issuance of any new Security under this Section 3.06, 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 of any series issued pursuant to this Section 3.06 in lieu of any mutilated, destroyed, lost or stolen Security, shall constitute an original additional contractual obligation of the Company, whether or not the mutilated, 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 of that series duly issued hereunder. The provisions of this Section 3.06 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 3.07 PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED Except as otherwise provided as contemplated by Section 3.01 hereof with respect to any series of Securities, interest on any Security 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 is registered at the close of business on the Regular Record Date for such interest at the office or agency of the Company maintained for such purpose pursuant to Section 6.02 hereof. 28 39 Any interest on any Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such defaulted interest and, if applicable, interest on such defaulted interest (to the extent lawful) at the rate specified in the Securities of such series (such defaulted interest and, if applicable, interest thereon herein collectively called "Defaulted Interest") may be paid by the Company, at its election in each case, as provided in clause (i) or (ii) below: (i) The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Securities of such series 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 of such series and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money (except as otherwise specified pursuant to Section 3.01 hereof for the Securities of such series) 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 on or prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided. Thereupon, the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 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 Securities of such series at its address as it appears in the Security Register, not less than 10 days prior to such Special Record Date and notice shall be considered given whether or not received by the Holder. If notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor have been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Securities of such series are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (ii). (ii) 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 the securities exchange on which such Securities may be listed, if any, and upon such notice as may be required by such exchange, if, after written 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. 29 40 The provisions of this Section 3.07 may be applicable to any series of Securities pursuant to Section 3.01 hereof (with such modifications, additions or substitutions as may be specified pursuant to such Section 3.01 hereof). Subject to the foregoing provisions of this Section 3.07 and Section 3.05 hereof, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security. SECTION 3.08 PERSONS DEEMED OWNERS Subject to Section 3.05(c), prior to due presentment of a Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Security is registered as the owner of such Security for the purpose of receiving payment of principal of and (except as contemplated by Section 3.05 hereof and subject to Section 3.07 hereof) interest on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee nor any agent of the Company or Trustee shall be affected by notice to the contrary. SECTION 3.09 CANCELLATION All Securities surrendered for payment, redemption, repayment at the option of the Holder, if applicable, registration of transfer or exchange or for credit against any current or future sinking fund payment shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be promptly cancelled by it. The Company may at any time deliver to the Trustee for cancellation any Securities previously authenticated and delivered hereunder 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 accompanied by an Officers' Certificate authorizing such cancellation, and shall be promptly cancelled by the Trustee. If the Company shall so acquire any of the Securities, however, such acquisition shall not operate as a redemption or satisfaction of the Indebtedness represented by such Securities unless and until the same are surrendered to the Trustee for cancellation. No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled Securities held by the Trustee shall be disposed of as directed by a Company Order. SECTION 3.10 COMPUTATION OF INTEREST 30 41 Except as otherwise specified as contemplated by Section 3.01 hereof for Securities of any series, interest on the Securities of each series shall be computed on the basis of a 365 or 366-day year. ARTICLE 4 REDEMPTION SECTION 4.01 APPLICABILITY OF ARTICLE If so provided as contemplated by Section 3.01 hereof for Securities of any series, Securities of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and in accordance with this Article 4. SECTION 4.02 ELECTION TO REDEEM; NOTICE TO TRUSTEE In the event the Company elects to redeem Securities of any series pursuant to the optional redemption provisions of Section 4.08 hereof, it will notify the Trustee in writing, at least 30 days but not more than 60 days before a redemption date, of the redemption date and the principal amount of Securities of a series to be redeemed. SECTION 4.03 SELECTION OF SECURITIES TO BE REDEEMED (a) In the event less than all of the Outstanding Securities of a series are to be redeemed, the Trustee will select the Securities of such series to be redeemed pro rata or by lot or by any other method the Trustee deems fair and appropriate but only in integral multiples of $1,000. The particular Securities of a series to be redeemed will be selected, unless otherwise provided herein, not less than 20 nor more than 60 days prior to the redemption date by the Trustee from the Outstanding Securities of such series not previously called for redemption. (b) The Trustee will promptly notify the Company in writing of the Securities of such series selected for redemption and, in the case of any Security of a series selected for partial redemption, the principal amount thereof to be redeemed but not in integral multiples of less than $1,000. Provisions of this Indenture that apply to Securities of a series called for redemption also apply to portions of Securities of a series called for redemption. SECTION 4.04 NOTICES TO HOLDERS (a) At least 15 days but not more than 60 days before a redemption date, the Company will mail a notice to each Holder whose Securities are to be redeemed. 31 42 (b) The notice will identify the Securities of the series to be redeemed and will state: (i) the redemption date; (ii) the redemption price; (iii) if any Outstanding Security of any series is being redeemed in part, the portion of the principal amount of such Security to be redeemed and that, after the redemption date, upon surrender of such Security, a new Security or Securities in principal amount equal to the unredeemed portion will be issued; (iv) the name and address of the Paying Agent; (v) that Securities called for redemption must be surrendered to the Paying Agent at the address specified in such notice to collect the redemption price; (vi) that interest on Securities called for redemption ceases to accrue on and after the redemption date; (vii) that the redemption is for a sinking fund, if such is the case; (viii) the aggregate principal amount of Securities that are being redeemed; and (ix) that funds for the redemption price shall be deposited in accordance with Section 4.06 hereof, failing which the notice shall be deemed cancelled. (c) At the Company's written request, the Trustee will give the notice required in this Section 4.04 in the Company's name and at its expense. SECTION 4.05 EFFECT OF NOTICE OF REDEMPTION Once notice of redemption is mailed, Outstanding Securities of such series called for redemption become due and payable on the redemption date at the redemption price and, subject to Section 4.06(b) hereof, interest on such Securities ceases to accrue on and after the redemption date. SECTION 4.06 DEPOSIT OF REDEMPTION PRICE (a) At least one Business Day prior to the redemption date, the Company will deposit with the Trustee or with the Paying Agent (or, if the Company is acting as its own Paying 32 43 Agent, segregate and hold in trust as provided in Section 6.04 hereof) money sufficient to pay the redemption price of, and accrued and previously unpaid interest on, all Securities of such series to be redeemed on that date, and the Trustee will remit the redemption price to Holders entitled thereto. The Trustee or the Paying Agent will return to the Company any money not required for that purpose. (b) If the Company complies with Section 4.06(a) hereof, interest on the Securities of such series or portions thereof to be redeemed (whether or not such Securities are presented for payment) will cease to accrue on the applicable redemption date. If any Security of such series called for redemption is not so paid upon surrender because of the failure of the Company to comply with Section 4.06(a) hereof, then interest will be paid on the unpaid principal from the last Interest Payment Date until such principal is paid in full at the rate determined pursuant to Section 3.01 hereof for the Securities of such series. SECTION 4.07 SECURITIES REDEEMED IN PART Upon surrender of a Security of such series that is redeemed in part, the Company will issue and the Trustee will authenticate for the Holder at the expense of the Company a new Security of the same series, maturity date, interest rate and Issue Date equal in principal amount to the unredeemed portion of the Security of such series surrendered. SECTION 4.08 OPTIONAL REDEMPTION The Company may redeem all or any portion of the Outstanding Securities of any series at any time and from time to time that are redeemable before their maturity except as otherwise specified as contemplated by Section 3.01 hereof for Securities of such series at the redemption prices together in each case, with accrued interest, if any, to the date fixed for redemption, determined pursuant to Section 3.01 hereof. ARTICLE 5 SINKING FUNDS SECTION 5.01 APPLICABILITY OF ARTICLE If so provided as contemplated by Section 3.01 hereof for Securities of any series, retirements of Securities of any series pursuant to any sinking fund shall be made in accordance with their terms and in accordance with this Article 5. The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a "mandatory sinking fund payment", and any 33 44 payment in excess of such minimum amount provided for by the terms of Securities of any series is herein referred to as an "optional sinking fund payment." If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 5.02 hereof. Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series. SECTION 5.02 SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES Subject to Section 5.03 hereof, in lieu of making all or any part of any mandatory sinking fund payment with respect to any Securities of a series in cash, the Company may at its option (i) deliver to the Trustee Outstanding Securities of a series (other than any previously called for redemption) theretofore purchased or acquired by the Company and/or (ii) receive credit for the principal amount of Securities of a series which have been previously delivered to the Trustee by the Company or for Securities of such series which have been redeemed either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any mandatory sinking fund payment with respect to the Securities of the same series required to be made pursuant to the terms of such Securities as provided for by the terms of such series; provided that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the redemption price specified in such Securities for redemption through operation of the sinking fund and the amount of such mandatory sinking fund payment shall be reduced accordingly. SECTION 5.03 REDEMPTION OF SECURITIES FOR SINKING FUND Not less than 60 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee an Officers' Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivering or crediting Securities of that series pursuant to Section 5.02 hereof (which Securities will, if not previously delivered, accompany such Officers' Certificate) and whether the Company intends to exercise its right to make a permitted optional sinking fund payment with respect to such series. Such Officers' Certificate shall be irrevocable and upon its delivery the Company shall be obligated to make the cash payment or payments therein referred to, if any, on or before the next succeeding sinking fund payment date. In the case of the failure of the Company to deliver such Officers' Certificate, the sinking fund payment due on the next succeeding sinking fund payment date for that series shall be paid entirely in cash and shall be sufficient to redeem the principal amount of such Securities subject to a mandatory sinking fund payment without the option to deliver or credit Securities as provided in Section 5.02 hereof and without the right to make any optional sinking fund payment, if any, with respect to such series. 34 45 Not more than 60 days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 4.03 hereof and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 4.04 hereof. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Article 4 hereof. Prior to any sinking fund payment date, the Company shall pay to the Trustee or a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 6.04 hereof) in cash a sum equal to any interest that will accrue to the date fixed for redemption of Securities or portion thereof to be redeemed on such sinking fund payment date pursuant to this Section 5.03. Notwithstanding the foregoing, with respect to a sinking fund for any series of Securities, if at any time the amount of cash to be paid into such sinking fund on the next succeeding sinking fund payment date, together with any unused balance of any preceding sinking fund payment or payments for such series, does not exceed in the aggregate $100,000, the Company shall not instruct the Trustee to give the next succeeding notice of the redemption of Securities of such series through the operation of the sinking fund. Any such unused balance of moneys deposited in such sinking fund shall be added to the sinking fund payment for such series to be made in cash on the next succeeding sinking fund payment date or, at the request of the Company, shall be applied at any time or from time to time to the purchase of Securities of such series, by public or private purchase as negotiated by the Company, in the open market or otherwise, at a purchase price for such Securities (excluding accrued interest and brokerage commissions, for which the Trustee or any Paying Agent will be reimbursed by the Company) not in excess of the principal amount thereof. ARTICLE 6 COVENANTS SECTION 6.01 PAYMENT OF SECURITIES (a) The Company will pay the principal of, and interest on, the Securities of each series on the dates and in the manner provided herein and in the Securities. In the event the Company is not the Paying Agent, principal and interest will be considered paid on the date due if the Trustee or Paying Agent holds on that date money deposited by the Company designated for and sufficient to pay all principal and interest then due. In the event the Company is the Paying Agent, principal and interest will be considered paid on the date actual payment is mailed, or otherwise sent or given, to the Holders entitled to such payments. 35 46 (b) The Company will pay interest on overdue principal at the applicable interest rate on the Securities of each series as determined in accordance with Section 3.01 hereof. SECTION 6.02 MAINTENANCE OF OFFICE OR AGENCY (a) The Company will maintain in each Place of Payment for any series of Securities, in New York, New York, an office or agency (which may be an office of the Trustee or the Registrar) where Securities of such series may be presented or surrendered for payment, where Securities of that series may be presented for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of such series and this Indenture may be served. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company fails to maintain any such required office or agency or fails 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. (b) The Company may also from time to time designate one or more other offices or agencies where the Securities of each series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission will in any manner relieve the Company of its obligation to maintain an office or agency in New York, New York 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. (c) The Company hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Company in accordance with this Section 6.02. SECTION 6.03 SEC REPORTS; FINANCIAL STATEMENTS (a) As long as more than 10 percent of the original principal amount of the Securities of any series is Outstanding, the Company will (i) remain subject to the requirements of Section 13 or 15(d) of the Exchange Act whether or not it is required to do so by the provisions thereof and will file with the SEC all periodic reports as may be required thereunder and (ii) file with the SEC, and the Trustee within 15 days after the Company is required to file the same with the SEC, copies of the periodic reports which the Company may be required to file with the SEC pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act. The Company will also make such reports available to the Holders, prospective purchasers of the Securities of any such series, securities analysts and broker-dealers upon their written request. (b) In the event that (i) 10 percent or less of the original principal amount of the Securities of any series is Outstanding and (ii) the Company is not required to file with the 36 47 SEC such reports and other information referred to in Section 6.03(a) hereof, the Company will furnish to the Trustee (A) within 120 days after the end of each fiscal year, annual reports containing the information required to be contained in Items 1, 2, 3, 5, 6, 7, 8 and 9 of the Annual Report on Form 10-K promulgated under the Exchange Act, or substantially the same information required to be contained in comparable items of any successor form, (B) within 60 days after the end of each of the first three fiscal quarters of each fiscal year, quarterly reports containing the information required to be contained in the Quarterly Report on Form 10-Q promulgated under the Exchange Act, or substantially the same information required to be contained in any successor form and (C) promptly from the time after the occurrence of an event which would be required to be reported in the Current Report on Form 8-K if the Company was required to file such Report, such other reports containing information required to be contained in the Current Report on Form 8-K promulgated under the Exchange Act, or substantially the same information required to be contained in any successor form. (c) The Company will also comply with the other provisions of TIA Section 314(a). SECTION 6.04 MONEY FOR SECURITY PAYMENTS TO BE HELD IN TRUST (a) In the event the Company will at any time act as its own Paying Agent with respect to any series of Securities, it will, not less than one Business Day before each due date of the principal of or interest on any of the Securities of any series, segregate and hold in trust for the benefit of the Holders entitled thereto a sum sufficient to pay the principal or interest so becoming due until such sums will be paid to such Persons or otherwise disposed of as herein provided, and will promptly notify the Trustee of its action or failure to so act. (b) In the event the Company is not acting as Paying Agent with respect to any series of Securities, the Company will, not less than one Business Day before each due date of the principal of or interest on, any Securities of any series, deposit with a Paying Agent a sum in same day funds sufficient to pay the principal or interest so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of such action or any failure to so act. (c) In the event the Company is not acting as Paying Agent with respect to any series of Securities, 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 will agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will: (i) hold all sums held by it for the payment of the principal of or interest on Securities of such series in trust for the benefit of the Holders of such series of 37 48 Securities and the Trustee entitled thereto until such sums will be paid to such Persons or otherwise disposed of as herein provided; (ii) give the Trustee notice of any Default by the Company in the making of any payment of principal or interest; (iii) 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 (iv) acknowledge, accept and agree to comply in all aspects with the provisions of this Indenture relating to the duties, rights and disabilities of such Paying Agent. (d) 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 sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such sums. (e) Except as provided in the Securities of any series, 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 or interest on any Security of any series and remaining unclaimed for two years after such principal or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall 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 New York, 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 notification or publication, any unclaimed balance of such money then remaining will be repaid to the Company. SECTION 6.05 COMPLIANCE CERTIFICATE (a) The Company will deliver to the Trustee within 120 days after the end of each fiscal year of the Company an Officers' Certificate stating whether or not the signers know 38 49 of any Default or Event of Default that occurred during such period. If they do know of a Default or an Event of Default, the Officers' Certificate will describe the Default or Event of Default and the action the Company is taking or proposes to take with respect thereto. (b) The Company will give prompt written notice to the Trustee of the occurrence of any Default or Event of Default. SECTION 6.06 CORPORATE EXISTENCE, ETC. Subject to the provisions of Article 7 hereof, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and the rights (charter and statutory), licenses and franchises of the Company, except in such cases where a failure to do so would not in the judgment of management have a material adverse effect on the business, prospects, assets or financial condition of the Company and its Subsidiaries taken as a whole and would not have a materially adverse impact on the Holders of Securities of any series. SECTION 6.07 PAYMENT OF TAXES AND OTHER CLAIMS The Company will pay or discharge or cause to be paid or discharged, before the same will become delinquent, (i) all taxes, assessments and governmental charges levied or imposed upon the Company or upon the income, profits or property of the Company other than any such tax, assessment, charge or claim whose amount, applicability or validity is being contested in good faith by appropriate proceedings and for which appropriate provision has been made in accordance with GAAP and (ii) all lawful claims for labor, materials and supplies which, if unpaid, might by law become a Lien upon the property of the Company, in each case except to the extent the failure to do so would not have, in the judgment of management, a material adverse effect on the Company and its Subsidiaries taken as a whole. SECTION 6.08 INSURANCE The Company will maintain and will cause each of its Restricted Subsidiaries to maintain (either in the name of the Company or in such Restricted Subsidiary's own name) with third party insurance companies or pursuant to self-insurance, (i) insurance on all their respective properties, (ii) public liability insurance against claims for personal injury or death as a result of the use of any products sold by it and (iii) insurance coverage against other business risks, in each case, in at least such amounts and against at least such other risks (and with such risk retention) as are usually and prudently insured against in the same general area by companies engaged in the same or a similar business. 39 50 SECTION 6.09 STAY, EXTENSION AND USURY LAWS The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the Company's obligation to pay the Securities of each series, and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law insofar as such law applies to the Securities of each series, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law has been enacted. SECTION 6.10 MAINTENANCE OF PROPERTIES The Company will take reasonable action to maintain in appropriate condition each of its principal properties which in the judgment of management is essential to the business operations of the Company and its Subsidiaries taken as a whole and the loss of which would have a material adverse effect on the financial condition of the Company and its Subsidiaries taken as a whole. Nothing contained in this Section 6.10 will prevent or restrict the sale, abandonment or other disposition of any property which management deems advisable. SECTION 6.11 PROHIBITION ON ISSUANCE OF OTHER SUBORDINATED INDEBTEDNESS SENIOR TO THE SECURITIES The Company will not create, incur or suffer to exist any Indebtedness that is expressly subordinated by the terms of the instrument evidencing such Indebtedness or pursuant to which such Indebtedness is issued in right of payment to any Senior Indebtedness unless such Indebtedness is pari passu with the Securities of any series or subordinate in right of payment to the Securities of any series pursuant to provisions substantially similar to those contained in Article 16 hereof. SECTION 6.12 LIMITATIONS ON RESTRICTED PAYMENTS (a) The Company will not, and will not permit any of its Restricted Subsidiaries to, make any Restricted Payment, directly or indirectly, after the Issue Date of Securities of any series if at the time of such Restricted Payment: (i) the amount of such Restricted Payment (the amount of such Restricted Payment, if other than in cash, will be determined by the Board of Directors of the Company), when added to the aggregate amount of all Restricted Payments made after the Issue Date of the Securities of any series, exceeds the sum of: (1) $100,000,000, plus (2) 50 percent of the Company's Consolidated Net Income 40 51 accrued during the period (taken as a single period) since January 1, 1997 (or, if such aggregate Consolidated Net Income is a deficit, minus 100 percent of such aggregate deficit), plus (3) the net cash proceeds derived from the issuance and sale of Capital Stock of the Company and its Restricted Subsidiaries that is not Disqualified Stock (other than a sale to a Subsidiary of the Company) after the Issue Date of Securities of any series but only to the extent not applied under clause (d) of the definition of "Restricted Payment" set forth in Section 1.02 hereof, plus (4) 100 percent of the principal amount of any Indebtedness of the Company or a Restricted Subsidiary that is converted into or exchanged for Capital Stock of the Company that is not Disqualified Stock, plus (5) 100 percent of the aggregate amounts received by the Company or any Restricted Subsidiary upon the sale, disposition or liquidation (including by way of dividends) of any Investment but only to the extent (x) not included in Section 6.12(a)(i)(2) above and (y) that the making of such Investment constituted a Restricted Investment made pursuant to this Section 6.12(a)(i), plus (6) 100 percent of the principal amount of, or if issued at a discount the accreted value of, any Indebtedness or other obligation that is the subject of a guaranty by the Company which is released after the Issue Date of Securities of any series, but only to the extent that the granting of such guaranty constituted a "Restricted Payment" under the definition set forth in Section 1.02 hereof; or (ii) the Company would be unable to incur an additional $1.00 of Indebtedness under the ratio of the Company's Indebtedness (excluding Non-Recourse Indebtedness) to Consolidated Tangible Net Worth contained in the covenant set forth in Section 6.13(a) hereof; or (iii) a Default or Event of Default has occurred and is continuing or occurs as a consequence thereof. (b) Notwithstanding the foregoing, the provisions of this Section 6.12 will not prevent: (i) the payment of any dividend within 60 days after the date of declaration thereof if the payment thereof would have complied with the limitations of this Indenture on the date of declaration or (ii) the retirement of shares of the Company's Capital Stock or the Company's or a Subsidiary of the Company's Indebtedness for, in exchange for or out of the proceeds of a substantially concurrent sale (other than a sale to a Subsidiary of the Company) of, other shares of its Capital Stock (other than Disqualified Stock). SECTION 6.13 LIMITATIONS ON ADDITIONAL INDEBTEDNESS (a) The Company will not, and will not permit any of its Restricted Subsidiaries to Incur any additional Indebtedness (other than Indebtedness between the Company and its Restricted Subsidiaries which are Wholly Owned Subsidiaries or among such Restricted 41 52 Subsidiaries which are Wholly Owned Subsidiaries), including Acquisition Debt, unless, after giving effect thereto or the application of the proceeds therefrom, the ratio of the Company's Indebtedness (excluding, for purposes of this calculation, Non-Recourse Indebtedness) to Consolidated Tangible Net Worth on the date thereof is not greater than 3.0 to 1.0. (b) Notwithstanding the foregoing, the provisions of this Indenture will not prevent: (i) in addition to the Indebtedness permitted to be Incurred under clauses (ii), (iii) and (iv) of this sentence and Indebtedness permitted to be Incurred under Section 6.13(a) hereof, the Company and/or any Restricted Subsidiary from Incurring (A) Refinancing Indebtedness, (B) Non-Recourse Indebtedness and (C) Indebtedness Incurred for working capital purposes or to finance the acquisition, holding or development of property by the Company and its Restricted Subsidiaries (including, without limitation, the financing of any related interest reserve) in the ordinary course of business in an aggregate amount at any one time outstanding not to exceed $50,000,000 (excluding any Indebtedness referred to in Section 6.13(a) hereof and clauses (i)(A), (i)(B), (ii), (iii) and (iv) of this Section 6.13(b)), (ii) Unrestricted Subsidiaries from Incurring Indebtedness, (iii) the Company and its Restricted Subsidiaries from Incurring Indebtedness under any deposits made to secure performance of tenders, bids, leases, statutory obligations, surety and appeal bonds, progress statements, government contracts and other obligations of like nature (exclusive of the obligation for the payment of borrowed money), in each case Incurred in the ordinary course of business of the Company or any Restricted Subsidiary consistent with past practice and (iv) Restricted Subsidiaries from guaranteeing Indebtedness of the Company or another Restricted Subsidiary. SECTION 6.14 CHANGE OF CONTROL (a) Following the occurrence of any Change of Control, the Company will so notify the Trustee in writing by delivery of an Officers' Certificate and will offer to purchase (a "Change of Control Offer") from all Holders, and will purchase from Holders accepting such Change of Control Offer on the date fixed for the closing of such Change of Control Offer (the "Change of Control Payment Date"), the Outstanding Securities of each series at an offer price (the "Change of Control Price") in cash in an amount equal to 101 percent of the aggregate principal amount thereof plus accrued and unpaid interest, if any, to the Change of Control Payment Date in accordance with the procedures set forth in this Section 6.14. (b) Within 30 days after the date of any Change of Control, the Company (with written notice to the Trustee) or the Trustee at the Company's request (and at the expense of the Company), will send or cause to be sent by first class mail, postage prepaid, to all Holders on the date of the Change of Control at their respective addresses appearing in the Security Register a notice, prepared by the Company advising the Holders of such series, of the occurrence of such Change of Control and of the Holders' rights arising as a result thereof. Such 42 53 notice will contain all instructions and materials necessary to enable Holders to tender their Securities of such series to the Company. Such notice, which will govern the terms of the Change of Control Offer, will state: (i) that the Change of Control Offer is being made pursuant to Section 6.14(a) hereof and the length of time the Change of Control Offer will remain open; (ii) that the Holder has the right to require the Company to repurchase such Holder's Securities of such series at the Change of Control Price; (iii) that any Security of such series not tendered will continue to accrue interest; (iv) that any Security of such series accepted for payment pursuant to the Change of Control Offer will cease to accrue interest on the Change of Control Payment Date; (v) that the Change of Control Payment Date will be no earlier than 45 days nor later than 60 days from the date such notice is mailed; (vi) that Holders electing to have a Security of such series purchased pursuant to any Change of Control Offer will be required to surrender the Security of such series, with the appropriate form on the Security of such series completed, to the Company, a depositary, if appointed by the Company, or a Paying Agent at the address specified in the notice prior to termination of the Change of Control Offer; (vii) that Holders will be entitled to withdraw their election if the Company, depositary or Paying Agent, as the case may be, receives, not later than the expiration of the Change of Control Offer, or such longer period as may be required by law, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security of such series the Holder delivered for purchase and a statement that such Holder is withdrawing its election to have the Security of such series purchased; (viii) that Holders which elect to have their Securities purchased only in part will be issued new Securities of the same series, Maturity date, interest rate and Issue Date in a principal amount equal to the unpurchased portion of the Securities of such series surrendered; and (ix) information concerning the date and details of the Change of Control and the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum will include (A) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) 43 54 of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Sales otherwise described in the offering materials relating to the Change of Control Offer (or corresponding successor reports) (or in the event the Company is not required to prepare any of the foregoing Forms, the comparable information required pursuant to Section 6.03(b) hereof); provided that the Company may at its option incorporate by reference any such filed reports in the notice, (B) a description of material developments in the Company's business subsequent to the date of the latest of such reports, and (C) if material, appropriate pro forma financial information). (c) In the event of a Change of Control Offer, the Company will only be required to accept Securities of each series in denominations of $1,000 or integral multiples thereof. (d) The Company will not, and will not permit any Restricted Subsidiary to, create or permit to exist or become effective any restriction (other than any restriction set forth in any agreement, indenture, document or instrument relating to any Existing Indebtedness or Refinancing Indebtedness with respect thereto) that would materially impair the ability of the Company to make a Change of Control Offer. Notwithstanding the foregoing, if a Change of Control Offer is made, the Company will pay for Securities of each series tendered for purchase in accordance with the terms of this Section 6.14. (e) Not later than one Business Day prior to the Change of Control Payment Date in connection with which the Change of Control Offer is being made, the Company will (i) accept for payment Securities of each series or portions thereof tendered pursuant to the Change of Control Offer, (ii) deposit with the Paying Agent money sufficient, in immediately available funds, to pay the purchase price of all Securities of each series or portions thereof so accepted and (iii) deliver to the Paying Agent an Officers' Certificate identifying the Securities of each series or portions thereof accepted for payment by the Company. The Paying Agent will promptly after acceptance mail or deliver to Holders of Securities of each series so accepted payment in an amount equal to the Change of Control Price of the Securities of each series purchased from each such Holder, and the Company will execute and, upon receipt of an Officers' Certificate of the Company, the Trustee will promptly authenticate and mail or deliver to such Holder a new Security of the same series, Maturity date, interest rate and Issue Date equal in principal amount to any unpurchased portion of the Security of such series surrendered. Any Securities of each series not so accepted will be promptly mailed or delivered by the Paying Agent at the Company's expense to the Holder thereof. The Company will publicly announce the results of the Change of Control Offer on the Change of Control Payment Date. For purposes of this Section 6.14(e), the Company will choose a Paying Agent which will not be the Company or a Subsidiary thereof. Any excess cash held by the Trustee after the expiration of the Change of Control Offer will be returned to the Company. 44 55 (f) Any Change of Control Offer will be conducted by the Company in compliance with applicable law, including, without limitation, Section 14(e) of the Exchange Act and Rule 14e-1 thereunder. SECTION 6.15 LIMITATIONS ON TRANSACTIONS WITH AFFILIATES (a) The Company will not, and will not permit any of its Restricted Subsidiaries to, make any loan, advance, guaranty or capital contribution to, or for the benefit of, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or for the benefit of, or purchase or lease any property or assets from, or enter into or amend any contract, agreement or understanding with, or for the benefit of, (i) any Affiliate of the Company or any Affiliate of the Company's Restricted Subsidiaries or (ii) any Person (or any Affiliate of such Person) holding 10 percent or more of the Common Equity of the Company or any of its Restricted Subsidiaries (each an "Affiliate Transaction"), except on terms that are no less favorable to the Company or the relevant Restricted Subsidiary, as the case may be, than those that could have been obtained in a comparable transaction on an arms' length basis from a Person that is not an Affiliate. (b) The Company will not, and will not permit any of its Restricted Subsidiaries to, enter into any Affiliate Transaction involving or having a value of more than $10,000,000, unless in each case such Affiliate Transaction has been approved by a majority of the disinterested members of the Company's Board of Directors. (c) The Company will not, and will not permit any of its Restricted Subsidiaries to, enter into an Affiliate Transaction involving or having a value of more than $20,000,000 unless the Company has delivered to the Trustee an opinion of an Independent Financial Advisor to the effect that the transaction is fair to the Company or the relevant Restricted Subsidiary, as the case may be, from a financial point of view. (d) Notwithstanding the foregoing, an Affiliate Transaction will not include (i) any contract, agreement or understanding with, or for the benefit of, or plan for the benefit of, employees or directors of the Company or its Subsidiaries (in their capacity as such) that has been approved by the Company's Board of Directors, (ii) Capital Stock issuances to members of the Board of Directors, officers or employees of the Company or its Subsidiaries pursuant to plans approved by the Company's Board of Directors, (iii) any Restricted Payment otherwise permitted under Section 6.12 hereof, (iv) any transaction between the Company or a Restricted Subsidiary and another Restricted Subsidiary, (v) any contract, agreement or understanding as in effect on the Issue Date of Securities of any series or any amendment thereto or any transaction contemplated thereby (including any amendment thereto) or (vi) loans or advances by the Company or any Restricted Subsidiary to Unrestricted Subsidiaries which in an aggregate amount at any one time outstanding do not exceed $50,000,000. 45 56 SECTION 6.16 LIMITATIONS ON RESTRICTIONS ON DISTRIBUTIONS FROM RESTRICTED SUBSIDIARIES The Company will not, and will not permit any of its Restricted Subsidiaries to, create, assume or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction (other than encumbrances or restrictions imposed by law or by judicial or regulatory action or by provisions in leases or other agreements that restrict the assignability thereof) on the ability of any Restricted Subsidiary to (i) pay dividends or make any other distributions on its Capital Stock or any other interest or participation in, or measured by, its profits, owned by the Company or any of its other Restricted Subsidiaries, or pay interest on or principal of any Indebtedness owed to the Company or any of its other Restricted Subsidiaries, (ii) make loans or advances to the Company or any of its other Restricted Subsidiaries, or (iii) transfer any of its properties or assets to the Company or any of its other Restricted Subsidiaries, except for encumbrances or restrictions existing under or by reason of (a) applicable law, (b) covenants or restrictions contained in Existing Indebtedness as in effect on the Issue Date of Securities of any series, (c) any restrictions or encumbrances arising in connection with the Existing Credit Facility; provided that any restrictions and encumbrances relating to any extension or renewal of the Existing Credit Facility are not more restrictive than those in the Existing Credit Facility being extended or renewed, (d) any restrictions or encumbrances arising in connection with Refinancing Indebtedness; provided that any restrictions and encumbrances of the type described in this clause (d) that arise under such Refinancing Indebtedness are not more restrictive than those under the agreement creating or evidencing the Indebtedness being refunded or refinanced, (e) any agreement restricting the sale or other disposition of property securing Indebtedness permitted by this Indenture if such agreement does not expressly restrict the ability of a Subsidiary of the Company to pay dividends or make loans or advances, (f) reasonable and customary borrowing base covenants set forth in credit agreements evidencing Indebtedness otherwise permitted by this Indenture which covenants restrict or limit the distribution of revenues or sale proceeds from real estate or a real estate project based upon the amount of Indebtedness outstanding on such real estate or real estate project and the value of some or all of the remaining real estate or the project's remaining assets, and (g) any restrictions under any instrument creating or evidencing any Acquisition Debt that was permitted to be Incurred pursuant to this Indenture and the Securities of any series and which (1) only apply to assets that were subject to such restrictions and encumbrances prior to the acquisition of such assets by the Company or any of its Restricted Subsidiaries and (2) were not created in connection with, or in contemplation of, such acquisition, and any restrictions replacing those permitted by this clause (g) which are not more restrictive than, and do not extend to any Persons or assets other than the Persons or assets subject to, the restrictions and encumbrances so replaced. 46 57 SECTION 6.17 MAINTENANCE OF CONSOLIDATED TANGIBLE NET WORTH (a) In the event the Consolidated Tangible Net Worth of the Company for any two consecutive fiscal quarters is less than $115,000,000, within 30 days after the end of each such period the Company will so notify the Trustee in writing by delivery of an Officers' Certificate and will offer to purchase from all Holders (a "Net Worth Offer"), and will purchase from Holders accepting such Net Worth Offer on the date fixed for the closing of such Net Worth Offer (the "Net Worth Offer Date"), ten percent of the original Outstanding principal amount of the Securities of each series (the "Net Worth Amount") at an offer price (the "Net Worth Offer Price") in cash in an amount equal to 100 percent of the principal amount thereof plus accrued and unpaid interest, if any, to the Net Worth Offer Date, in accordance with the procedures set forth in this Section 6.17. To the extent that the aggregate amount of Securities of each series tendered pursuant to a Net Worth Offer is less than the Net Worth Amount relating thereto, then the Company may use the excess of the Net Worth Amount over the amount of Securities of each series tendered, or a portion thereof, for general corporate purposes. (b) In the event the Consolidated Tangible Net Worth of the Company for any two consecutive fiscal quarters is less than $115,000,000, within 30 days after the end of such period, the Company (with written notice to the Trustee) or the Trustee at the Company's request (and at the expense of the Company) will send or cause to be sent by first-class mail, postage prepaid, to all Holders on the date of the end of the second such consecutive fiscal quarter, at their respective addresses appearing in the Security Register, a notice, prepared by the Company advising the Holders of such series, of such occurrence and of each Holders' rights arising as a result thereof. Such notice will contain all instructions and materials necessary to enable Holders to tender their Securities of each series to the Company. Such notice, which will govern the terms of the Net Worth Offer, will state: (i) that the Net Worth Offer is being made pursuant to Sec tion 6.17(a) hereof and the length of time such Net Worth Offer will remain open; (ii) that the Holder has the right to require the Company to repurchase such Holder's Securities of such series at the Net Worth Offer Price; (iii) that any Security of such series not tendered will continue to accrue interest; (iv) that any Security of such series accepted for payment pursuant to the Net Worth Offer will cease to accrue interest on the Net Worth Offer Date; (v) that the Net Worth Offer Date will be no earlier than 45 days nor later than 60 days from the date such notice is mailed; 47 58 (vi) that Holders electing to have a Security of such series purchased pursuant to any Net Worth Offer will be required to surrender the Security of such series, with the appropriate form on the Security of such series completed, to the Company, a depositary, if appointed by the Company, or a Paying Agent at the address specified in the notice prior to termination of the Net Worth Offer; (vii) that Holders will be entitled to withdraw their election if the Company, depositary or Paying Agent, as the case may be, receives, not later than the expiration of the Net Worth Offer, or such longer period as may be required by law, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security the Holder delivered for purchase and a statement that such Holder is withdrawing its election to have the Security of such series purchased; (viii) that Holders whose Securities of such series are purchased only in part will be issued Securities of the same series, Maturity date, interest rate and Issue Date equal in principal amount to the unpurchased portion of the Securities of such series surrendered; and (ix) information concerning the period and details of the events requiring the Net Worth Offer and the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum will include (A) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Sales otherwise described in the offering materials relating to the Net Worth Offer (or corresponding successor reports) (or in the event the Company is not required to prepare any of the foregoing Forms, the comparable information required pursuant to Section 6.03(b) hereof); provided that the Company may at its option incorporate by reference any such filed reports in the notice, (B) a description of material developments in the Company's business subsequent to the date of the latest of such reports, and (C) if material, appropriate pro forma financial information). (c) In the event the aggregate principal amount of Securities of such series surrendered by Holders exceeds the Net Worth Amount, the Company will select the Securities of such series to be purchased on a pro rata basis from all Securities of such series so surrendered, with such adjustments as may be deemed appropriate by the Company so that only Securities of any series in denominations of $1,000, or integral multiples thereof, will be purchased. To the extent that the Net Worth Amount remaining is less than $1,000, the Company may use such Net Worth Amount for general corporate purposes. Holders whose Securities of such series are purchased only in part will be issued new Securities of the same series, Maturity date, interest rate and Issue Date equal in principal amount to the unpurchased portion of the Securities of such series surrendered. 48 59 (d) The Company will not, and will not permit any Restricted Subsidiary to, create or permit to exist or become effective any restriction (other than any restriction set forth in any agreement, indenture, document or instrument relating to any Existing Indebtedness or Refinancing Indebtedness with respect thereto) that would materially impair the ability of the Company to make a Net Worth Offer. Notwithstanding the foregoing, if a Net Worth Offer is made, the Company will pay for Securities of any series tendered for purchase in accordance with the terms of this Section 6.17. (e) Not later than one Business Day prior to the Net Worth Offer Date in connection with which the Net Worth Offer is being made, the Company will (i) accept for payment Securities of each series or portions thereof tendered pursuant to the Net Worth Offer (on a pro rata basis if required pursuant to Section 6.17(c) above), (ii) deposit with the Paying Agent money sufficient, in immediately available funds, to pay the purchase price of all Securities of each series or portions thereof so accepted and (iii) deliver to the Paying Agent an Officers' Certificate identifying the Securities of each series or portions thereof accepted for payment by the Company. The Paying Agent will promptly after acceptance mail or deliver to Holders of Securities of such series so accepted payment in an amount equal to the Net Worth Offer Price of the Securities of such series purchased from each such Holder, and the Company will execute and the Trustee will promptly authenticate and mail or deliver to such Holder a new Security of the same series, Maturity date, interest rate and Issue Date equal in principal amount to any unpurchased portion of the Security of such series surrendered. Any Securities of such series not so accepted will be promptly mailed or delivered by the Paying Agent at the Company's expense to the Holder thereof. The Company will publicly announce the results of the Net Worth Offer on the Net Worth Offer Date. For purposes of this Section 6.17(e), the Company will choose a Paying Agent which will not be the Company or a Subsidiary thereof. Any excess cash held by the Trustee after the expiration of the Net Worth Offer will be returned to the Company. (f) Any Net Worth Offer will be conducted by the Company in compliance with applicable law, including, without limitation, Section 14(e) of the Exchange Act and Rule 14e-1 thereunder, if applicable. ARTICLE 7 SUCCESSORS SECTION 7.01 LIMITATIONS ON MERGERS AND CONSOLIDATIONS (a) The Company will not consolidate or merge with or into, or sell, lease, convey or otherwise dispose of all or substantially all of its assets (including, without limitation, by way of liquidation or dissolution), or assign any of its obligations hereunder or under the 49 60 Securities of any series (as an entirety or substantially an entirety in one transaction or series of related transactions), to any Person unless: (i) the Person formed by or surviving such consolidation or merger (if other than the Company), or to which sale, lease, conveyance or other disposition or assignment will be made (collectively, the "Successor"), is a solvent corporation or other legal entity organized and existing under the laws of the United States or any state thereof or the District of Columbia, and the Successor assumes by supplemental indenture in a form reasonably satisfactory to the Trustee all of the obligations of the Company under the Securities of any series and this Indenture, (ii) immediately after giving effect to such transaction, no Default or Event of Default has occurred and is continuing, (iii) immediately after giving effect to such transaction and the use of any net proceeds therefrom on a pro forma basis, the Consolidated Tangible Net Worth of the Company or the Successor, as the case may be, would be at least equal to the Consolidated Tangible Net Worth of the Company immediately prior to such transaction and (iv) the ratio of the Company's Indebtedness (excluding Non-Recourse Indebtedness) to Consolidated Tangible Net Worth contained in Section 6.13(a) hereof of the Company or the Successor, as the case may be, immediately after giving effect to such transaction, would be such that the Company or the Successor, as the case may be, would be entitled to Incur at least $1 of additional Indebtedness under such ratio. (b) The Company will deliver to the Trustee prior to the consummation of the proposed transaction an Officers' Certificate to the foregoing effect and an Opinion of Counsel stating that the proposed transaction and such supplemental indenture comply with this Indenture. SECTION 7.02 SUCCESSOR CORPORATION SUBSTITUTED Upon any consolidation or merger, or any sale, lease, conveyance or other disposition of all or substantially all of the assets of the Company or any assignment of its obligations under this Indenture or the Securities of any series in accordance with Section 7.01 hereof, upon assumption by the successor corporation, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the due and punctual payment of the principal of and interest on all of the Securities of any series and the due and punctual performance and observance of all the covenants and conditions of this Indenture to be performed or observed by the Company, the Successor formed by such consolidation or into or with which the Company is merged or to which such sale, lease, conveyance or other disposition or assignment is made will 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 has been named as the Company herein and such Successor may cause to be signed and may issue in its own name or in the name of the Company, any or all Securities of any series issuable hereunder and the predecessor Company, in the case of a sale, lease, conveyance or other disposition or assignment, will be released from all obligations under this Indenture and the Securities of any series. 50 61 ARTICLE 8 DEFAULTS AND REMEDIES SECTION 8.01 EVENTS OF DEFAULT (a) "Event of Default", wherever used herein with respect to Securities of any series, means any of the following events (whatever the reason for such Event of Default and whether it will 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): (i) the failure by the Company to pay interest on any Security of that series when the same becomes due and payable and the continuance of any such failure for a period of 30 days; (ii) the failure by the Company to pay the principal of any Security of that series when the same becomes due and payable at Maturity, upon acceleration or otherwise (including the failure to make payment pursuant to a Change of Control Offer or a Net Worth Offer); (iii) the failure by the Company to make any sinking fund payment when the same becomes due and payable by the terms of a Security of that series and Article 5 hereof; (iv) the failure by the Company to comply with any of its agreements or covenants in, or provisions of, the Security of that series or this Indenture (other than an agreement or covenant a default in whose performance or whose breach is elsewhere in this Section specifically dealt with or which has expressly been included in this Indenture solely for the benefit of a series of Securities other than that series) and such failure continues for the period and after the notice specified below; (v) the acceleration of any Indebtedness (other than Non-Recourse Indebtedness) for borrowed money or guarantees thereof of the Company or any of its Subsidiaries that has an outstanding principal amount of $10,000,000 or more in the aggregate; provided that, in the event any such acceleration is withdrawn or otherwise rescinded within a period of five days after such acceleration by the holders of such Indebtedness, any Event of Default under this Section 8.01(a)(v) will be deemed to be cured and any acceleration hereunder will be deemed withdrawn or rescinded; (vi) the failure by the Company or any of its Subsidiaries to make any principal or interest payment in respect of Indebtedness (other than Non-Recourse 51 62 Indebtedness) for the borrowed money or guarantees thereof of the Company or any of its Subsidiaries with an outstanding aggregate amount of $10,000,000 or more within five days of such principal or interest payment becoming due and payable (after giving effect to any applicable grace period set forth in the documents governing such Indebtedness); (vii) a final judgment or judgments that exceed $10,000,000 or more in the aggregate, for the payment of money, having been entered by a court or courts of competent jurisdiction against the Company or any of its Subsidiaries and such judgment or judgments is not satisfied, stayed, annulled or rescinded within 60 days of being entered; (viii) the Company or any Material Subsidiary pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case, (B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointment of a Custodian of it or for all or substantially all of its property, or (D) makes a general assignment for the benefit of its creditors; (ix) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief against the Company or any Material Subsidiary as debtor in an involuntary case, (B) appoints a Custodian of the Company or any Material Subsidiary or a Custodian for all or substantially all of the property of the Company or any Material Subsidiary, or (C) orders the liquidation of the Company or any Material Subsidiary, and the order or decree remains unstayed and in effect for 60 days; or (x) any other Event of Default provided with respect to Securities of that series. 52 63 (b) The Trustee will not be deemed to know of a Default unless a Trust Officer has actual knowledge of such Default or receives written notice of such Default with specific reference to such Default. (c) A Default under Section 8.01(a)(iv) hereof is not an Event of Default until the Trustee notifies the Company, or the Holders of at least 25 percent in aggregate principal amount of the Outstanding Securities of all series affected thereby notify the Company and the Trustee, of the Default and the Company does not cure the Default within 60 days after receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a "Notice of Default." If such a Default is cured within such time period, it ceases. SECTION 8.02 ACCELERATION (a) If an Event of Default with respect to Securities of any series at the time Outstanding (other than an Event of Default with respect to the Company specified in clause (viii) or (ix) of Section 8.01(a) hereof) occurs and is continuing, the Trustee (after receiving indemnities from the Holders to its satisfaction) by notice to the Company, or the Holders of at least 25 percent in aggregate principal amount of the Outstanding Securities of such series by notice to the Company and the Trustee, may declare all Outstanding Securities of such series to be due and payable immediately. Upon such declaration, the amounts due and payable on the Securities of such series, as determined in Section 8.02(b) hereof, will be due and payable immediately. If an Event of Default specified in clause (viii) or (ix) of Section 8.01(a) hereof occurs, such an amount will ipso facto become and be immediately due and payable without any declaration, notice or other act on the part of the Trustee and the Company or any Holder. The Holders of a majority in aggregate principal amount of the Outstanding Securities of any series by written notice to the Trustee and the Company may waive such Event of Default, rescind an acceleration and its consequences (except an acceleration due to nonpayment of principal or interest on the Securities of such series) if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived. (b) In the event that the maturity of the Securities of any series is accelerated pursuant to Section 8.02(a) hereof, 100 percent of the principal amount of the Securities of such series (or in the case of a default under Section 8.01(a)(ii) or (iv) hereof resulting from a breach of the covenant set forth in Section 6.14 hereof, 101 percent of the principal amount of the Securities of such series) will become due and payable plus accrued interest, if any, to the date of payment. SECTION 8.03 OTHER REMEDIES (a) If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal or 53 64 interest on the Securities of any series or to enforce the performance of any provision of the Securities of any series or this Indenture. (b) The Trustee may maintain a proceeding even if it does not possess any of the Securities of any series or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default will not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law. SECTION 8.04 WAIVER OF PAST DEFAULTS AND COMPLIANCE WITH INDENTURE PROVISIONS Subject to Sections 8.07 and 13.02 hereof, the Holders of a majority in aggregate principal amount of the Outstanding Securities of any series by notice to the Trustee may waive an existing Default or Event of Default and its consequences (including waivers obtained in connection with a tender offer or exchange offer for Securities), except a continuing Default or Event of Default in the payment of the principal of or interest on any Security of such series. Upon any such waiver, such Default will cease to exist, and any Event of Default arising therefrom will be deemed to have been cured for every purpose of this Indenture, but no such waiver will extend to any subsequent or other Default or Event of Default or impair any right consequent thereon. SECTION 8.05 CONTROL BY MAJORITY The Holders of a majority in aggregate principal amount of the Outstanding Securities of any series may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee (after providing indemnities to the Trustee's satisfaction) or exercising any trust or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture that the Trustee determines may be unduly prejudicial to the rights of other Holders of Securities of such series, or that may subject the Trustee to legal liability; provided that the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction. SECTION 8.06 LIMITATIONS ON SUITS (a) A Holder may pursue a remedy with respect to this Indenture or the Securities of any series only if: (i) the Holder gives to the Trustee written notice of a continuing Event of Default with respect to the Securities of that series; 54 65 (ii) the Holder(s) of at least 25 percent in aggregate principal amount of all of the Outstanding Securities of that series make a written request to the Trustee to pursue the remedy; (iii) such Holder or Holders offer to the Trustee indemnity reasonably satisfactory to the Trustee against any loss, liability or expense; (iv) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and (v) during such 60-day period the Holders of a majority in aggregate principal amount of the Outstanding Securities of such series do not give the Trustee a direction inconsistent with the request. (b) A Holder of a Security of any series may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder. SECTION 8.07 RIGHTS OF HOLDERS TO RECEIVE PAYMENT Notwithstanding any other provision of this Indenture, the right of any Holder of a Security of any series to receive payment of principal and interest on the Security of such series, on or after the respective due dates expressed in the Security of such series, or, subject to Section 8.06 hereof, to bring suit for the enforcement of any such payment on or after such respective dates, will not be impaired or affected without the consent of the Holder. SECTION 8.08 COLLECTION SUIT BY TRUSTEE If an Event of Default specified in Section 8.01(a)(i) or 8.01(a)(ii) hereof occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the amount of principal and interest remaining unpaid on the Securities of such series, determined in accordance with Section 8.02(b) hereof, and such further amount as will be sufficient to cover the costs and expenses of collection, including, without limitation, the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. SECTION 8.09 TRUSTEE MAY FILE PROOFS OF CLAIM The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including, without limitation, any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, it agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company, its creditors or property and will be entitled and 55 66 empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee consents to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 9.07 hereof. Nothing contained herein will 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 8.10 PRIORITIES (a) Subject to Article 16 hereof, in the event the Trustee collects any money pursuant to this Article 8, it will pay out the money in the following order: FIRST: to the Trustee for amounts due under Section 9.07 hereof; SECOND: to Holders for amounts due and unpaid on the Securities for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Securities for principal and interest, respectively; and THIRD: to the Company or such other Person legally entitled thereto. (b) The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 8.10. SECTION 8.11 UNDERTAKING FOR COSTS In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant (other than the Trustee) in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 8.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 8.07 hereof, or a suit by Holders of more than ten percent in aggregate principal amount of all of the Outstanding Securities of any series. 56 67 SECTION 8.12 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 Trustee and the Holders will, 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 will continue as though no such proceeding had been instituted. ARTICLE 9 TRUSTEE SECTION 9.01 DUTIES OF TRUSTEE (a) If an Event of Default has occurred and is continuing, the Trustee will exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in such exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. (b) Except during the continuance of an Event of Default: (i) the Trustee need perform only those duties that are specifically set forth in this Indenture and no others, and no implied covenants or obligations will 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. However, in the case of any such certificates or opinions which are specifically required to be furnished to the Trustee by any of the provisions hereof, the Trustee will examine the certificates and opinions to determine whether or not, on their face, they appear to conform to the requirements of this Indenture. (c) The Trustee may not be relieved from liabilities for its own gross negligent action, its own gross negligent failure to act, or its own willful misconduct, except that: (i) this Section 9.01(c) does not limit the effect of Section 9.01(b) hereof; 57 68 (ii) the Trustee will not be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee was grossly negligent in ascertaining the pertinent facts; and (iii) the Trustee will not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 9.05 hereof or when exercising any other trust or power conferred upon the Trustee under this Indenture. Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to clauses (i), (ii) and (iii) of this Section 9.01(c). (d) No provision of this Indenture will 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 has reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (e) The Trustee will not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. Subject to Sections 9.03 and 9.07 hereof, all money received by the Trustee will, until applied as herein provided, be held in trust for the payment of principal and interest on the Securities. (f) The Trustee shall not be required to give any bond or surety in respect of the exercise of its powers and performance of its duties hereunder. SECTION 9.02 RIGHTS OF TRUSTEE (a) Subject to Section 9.01 hereof: (i) the Trustee may rely and will be protected in acting or refraining from acting upon any document believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in the 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 determines to make such further inquiry or investigation, it will be entitled to examine the books, records, and premises of the Company, personally or by agent or attorney; (ii) before the Trustee acts or refrains from acting, it may require an Officers' Certificate. The Trustee will not be liable for any action it takes or omits to take 58 69 in good faith in reliance on such Officers' Certificate. The Trustee may consult with counsel satisfactory to it and the written advice of such counsel or any Opinion of Counsel will 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; (iii) the Trustee may act through agents and will not be responsible for the misconduct or negligence of any agent appointed with due care; provided, however, that the Trustee will in any event be liable for the misappropriation of funds deposited with it or in an account within its dominion and control; (iv) the Trustee will not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers conferred upon it by this Indenture; and (v) unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company will be sufficient if signed by an Officer of the Company. (b) The Trustee will be under no obligation to exercise and may refuse 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 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. SECTION 9.03 INDIVIDUAL RIGHTS OF TRUSTEE The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or any of its Affiliates with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. However, the Trustee is subject to Sections 9.10 and 9.11 hereof. SECTION 9.04 TRUSTEE'S DISCLAIMER The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities of any series, it will not be accountable for any actions taken by the Company or any action taken by the Trustee hereunder at the direction of the Company or in reliance upon an Opinion of Counsel, and it will not be responsible for any statement or recital herein or any statement in the Securities of any series other than its certificate of authentication. The immunities and exemptions from liability of the Trustee hereunder shall extend to its directors, officers, employees and agents. 59 70 SECTION 9.05 NOTICE OF DEFAULTS If a Default or Event of Default with respect to any series of Securities occurs and is continuing and if it is known to the Trustee, the Trustee will mail to Holders of such Securities a notice of the Default or Event of Default within 90 days after it occurs. However, except in the case of a Default or Event of Default in payment of principal or interest on any Security of such series or a breach of the Change of Control covenant, the Trustee may withhold such notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of such Holders. SECTION 9.06 REPORTS BY TRUSTEE TO HOLDERS (a) Within 60 days after each _________ __, beginning with _________ __, 199_, the Trustee will mail to Holders a brief report dated as of such reporting date that complies with TIA Section 313(a); provided, however, if no event described in TIA Section 313(a) has occurred within such calendar year, no report need be transmitted. The Trustee also will comply with TIA Sections 313(b) and 313(c). (b) A copy of each report at the time of its mailing to Holders will be filed with the SEC and each stock exchange, if any, on which the Securities of any series are listed. The Company will notify the Trustee when the Securities of any series are listed on any stock exchange. SECTION 9.07 COMPENSATION AND INDEMNITY (a) The Company agrees: (i) to pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder (which compensation will not be limited by any provision of law in regard to the compensation of a trustee of an express trust); (ii) 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, without limitation, the reasonable compensation and the expenses, advances and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its gross negligence or bad faith; and (iii) to indemnify the Trustee and its agents for, and to hold them harmless against, any loss, liability or expense incurred without gross negligence or bad faith on their part, arising out of or in connection with the acceptance or 60 71 administration of this trust, including the costs and expenses of defending themselves against any claim or liability in connection with the exercise or performance of any of their powers or duties hereunder. (b) To secure the Company's payment obligations in this Section 9.07, the Trustee will have a Lien prior to the Securities on all money or property held or collected by the Trustee, except that held in trust to pay principal and interest on particular Securities. (c) When the Trustee incurs expenses or renders services after an Event of Default specified in Section 8.01(a)(viii) or (a)(ix) occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law. SECTION 9.08 REPLACEMENT OF TRUSTEE (a) A resignation or removal of the Trustee and appointment of a successor Trustee will become effective only upon the successor Trustee's acceptance of appointment as provided in this Section 9.08. (b) The Trustee may resign and be discharged from the trust hereby created by so notifying the Company in writing. The Holders of a majority in principal amount of the Outstanding Securities of any series may remove the Trustee by so notifying the Trustee and the Company. The Company may remove the Trustee if: (i) the Trustee fails to comply with Section 9.10 hereof; (ii) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law; (iii) a Custodian or public officer takes charge of the Trustee or its property; or (iv) the Trustee becomes incapable of acting. (c) If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company will promptly appoint a successor Trustee. (d) If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of at least ten percent in principal amount of the Outstanding Securities of any series may petition any court of competent jurisdiction for the appointment of a successor Trustee. 61 72 (e) If the Trustee with respect to any series of Securities fails to comply with Section 9.10 hereof, any Holder may petition any court of competent jurisdiction for the removal of the Trustee with respect to such series and the appointment of a successor Trustee. (f) A successor Trustee will deliver a written acceptance of its appointment to the retiring Trustee with respect to such series and to the Company. Thereupon the resignation or removal of the retiring Trustee will become effective, and the successor Trustee will have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee will mail a notice of its succession to the Holders. The retiring Trustee will promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 9.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section 9.08, the Company's obligations under Section 9.07 hereof will continue for the benefit of the retiring Trustee. SECTION 9.09 SUCCESSOR TRUSTEE BY MERGER, ETC. (a) Subject to Section 9.10 hereof, if the Trustee with respect to any series of Securities consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act will be the successor Trustee; provided that in the case of a transfer of all or substantially all of its corporate trust business to another corporation, the transferee corporation expressly assumes all of the Trustee's liabilities hereunder. (b) In case any Securities of any series 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 9.10 ELIGIBILITY; DISQUALIFICATION (a) There will at all times be a Trustee hereunder which will (i) be a corporation organized and doing business under the laws of the United States, any state thereof or the District of Columbia, authorized under such laws to exercise corporate trustee power, (ii) be subject to supervision or examination by federal or state (or the District of Columbia) authority and (iii) have a combined capital and surplus of at least $150 million as set forth in its most recent published annual report of condition. (b) This Indenture will always have a Trustee who satisfies the requirements of TIA Sections 310(a)(1) and 310(a)(2). The Trustee is subject to TIA Section 310(b). If at any time the Trustee ceases to be eligible in accordance with the provisions of this Section 9.10, it will resign immediately in the manner and with the effect specified in Section 9.08 hereof. 62 73 SECTION 9.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY The Trustee is subject to TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). A Trustee who has resigned or been removed will be subject to TIA Section 311(a) to the extent indicated therein. ARTICLE 10 HOLDERS' LISTS SECTION 10.01 COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF HOLDERS The Company will furnish or cause to be furnished to the Trustee: (i) semi-annually, not more than 15 days before each Interest Payment Date, a list, in such form as the Trustee may reasonably require, of the names and addresses of the Holders of such series of Securities as of the Regular Record Date of such Interest Payment Date; and (ii) at such other times as the Trustee may request in writing, within 30 days after 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, however, that if and so long as the Trustee will be the Registrar, no such list need be furnished. SECTION 10.02 PRESERVATION OF INFORMATION The Trustee will preserve, in as current a form as is reasonably practicable, the names and addresses of Holders of each series of Securities contained in the most recent list furnished to the Trustee as provided in Section 10.01 hereof and the names and addresses of such Holders received by the Trustee in its capacity as Registrar or Paying Agent (if so acting). The Trustee may destroy any list furnished to it as provided in Section 10.01 hereof upon receipt of a new list so furnished. 63 74 ARTICLE 11 DEFEASANCE AND COVENANT DEFEASANCE SECTION 11.01 COMPANY'S OPTION TO EFFECT DEFEASANCE OR COVENANT DEFEASANCE The Company may elect, at its option by Board Resolution at any time, to have either Section 11.02 or 11.03 hereof applied to the Outstanding Securities of any series designated pursuant to Section 3.01 hereof as being defeasible pursuant to this Article 11 (hereinafter called a "Defeasible Series"), upon compliance with the conditions set forth below in this Article 11. SECTION 11.02 DEFEASANCE AND DISCHARGE Upon the Company's exercise of the option provided in Section 11.01 hereof to have this Section 11.02 applied to the Outstanding Securities of any Defeasible Series, the Company shall be deemed to have been discharged from its obligations with respect to the Outstanding Securities of such series as provided in this Section 11.02 on and after the date the conditions set forth in Section 11.04 hereof 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 the Outstanding Securities of such series, which shall thereafter be deemed to be "Outstanding" only for the purposes of Section 11.05 hereof and the other Sections of this Indenture referred to in (i) and (ii) below, and to have satisfied all its other obligations under the Securities of such series and this Indenture insofar as such Securities are concerned (and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged hereunder: (i) the rights of Holders of Outstanding Securities of such series to receive solely from the trust fund described in Section 11.04 hereof and as more fully set forth in such Section, payments in respect of the principal of and interest on such Securities of such series when payments are due, (ii) the Company's obligations with respect to the Securities of such series under Sections 3.04, 3.05, 3.06, 6.02 and 6.04 hereof, (iii) the rights, powers, trusts, duties and immunities of the Trustee hereunder and (iv) this Article 11. Subject to compliance with this Article 11, the Company may exercise its option provided in Section 11.01 hereof to have this Section 11.02 applied to the Outstanding Securities of any Defeasible Series notwithstanding the prior exercise of its option provided in Section 11.01 hereof to have Section 11.03 hereof applied to such Outstanding Securities. 64 75 SECTION 11.03 COVENANT DEFEASANCE Upon the Company's exercise of the option provided in Section 11.01 hereof to have this Section 11.03 applied to the Outstanding Securities, (i) the Company shall be released from its obligations under Sections 6.03 and 6.06 through 6.17, inclusive, Article 7, and any other covenants specified in or pursuant to this Indenture and (ii) the occurrence of any event specified in Sections 8.01(a)(iv) (with respect to any of Sections 6.03 and 6.06 through 6.17 inclusive, and any other covenants specified in or pursuant to this Indenture) and 8.01(a)(x) shall be deemed not to be or result in an Event of Default, in each case with respect to the Outstanding Securities of such series as provided in this Section 11.03 on and after the date the conditions set forth in Section 11.04 hereof are satisfied (hereinafter called "Covenant Defeasance"), and such Securities shall thereafter be deemed not to be "Outstanding" for the purposes of any direction, waiver, consent, declaration or act of Holders (and the consequences thereof) in connection with such covenants, but shall continue to be "Outstanding" for all other purposes hereunder. For this purpose, such Covenant Defeasance means that, with respect to such Outstanding 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 covenant, whether directly or indirectly by reason of any reference elsewhere herein to any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or Event of Default under Section 8.01(a)(iv) or 8.01(a)(x), or otherwise, as the case may be, but, except as specified above, the remainder of this Indenture and the Securities of such series shall be unaffected thereby. SECTION 11.04 CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE The following shall be the conditions to application of either Section 11.02 or 11.03 hereof to the Outstanding Securities of any Defeasible Series: (i) The Company shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee that satisfies the requirements contemplated by Section 9.10 hereof and agrees to comply with the provisions of this Article 11 applicable to it) as trust funds in trust for the purpose of making the following payments, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of Outstanding Securities of such series, (A) money in an amount, or (B) U.S. Government Obligations that through the scheduled payment of principal and interest in respect thereof in accordance with their terms will provide, not later than one day before the due date of any payment, money in an amount, or (C) a combination thereof, in each case sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or any such other qualifying trustee) to pay and discharge, (1) the principal of and interest on the Securities of such series on the respective Stated Maturities (or redemption date, if applicable) of such 65 76 principal or installment of interest and (2) any mandatory sinking fund payments or analogous payments applicable to such Outstanding Securities on the day on which such payments are due and payable in accordance with the terms of this Indenture and such Securities; provided that the Trustee shall have been irrevocably instructed to apply such money or the proceeds of such U.S. Government Obligations to said payments with respect to such Securities. Before such a deposit, the Company may give to the Trustee, in accordance with Section 4.02 hereof, a notice of its election to redeem all or any portion of such Outstanding Securities at a future date in accordance with the terms of the Securities of such series and Article 4 hereof, which notice shall be irrevocable. Such irrevocable redemption notice, if given, shall be given effect in applying the foregoing. (ii) In the case of an election under Section 11.02 hereof, 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 first set forth hereinabove, there has been a change in the applicable Federal income tax law, in either case, to the effect that, and based thereon such opinion shall confirm that, the Holders of the Outstanding Securities of such series will not recognize income, gain or loss for Federal income tax purposes as a result of such Defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at the same times as would be the case if such deposit, Defeasance and discharge were not to occur. (iii) In the case of an election under Section 11.03 hereof, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders of the Outstanding Securities of such series will not recognize income, gain or loss for Federal income tax purposes as result of such Covenant Defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at the same times as would be the case if such deposit and Covenant Defeasance were not to occur. (iv) The Company shall have delivered to the Trustee an Officers' Certificate to the effect that the Securities of such series, if then listed on any securities exchange, will not be delisted as a result of such Defeasance or Covenant Defeasance. (v) No Default or Event of Default shall have occurred and be continuing at the time of such deposit. 66 77 (vi) Such Defeasance or Covenant Defeasance shall not cause the Trustee to have a conflicting interest within the meaning of the TIA (assuming all Securities are in default within the meaning of the TIA). (vii) Such Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, any other agreement or instrument to which the Company is a party or by which it is bound. (viii) Notwithstanding any other provisions of this Section, such Defeasance or Covenant Defeasance shall be effected in compliance with any additional or substitute terms, conditions or limitations in connection therewith pursuant to Section 3.01 hereof. (ix) The Company shall have delivered to the Trustee an Officers' Certificate, stating that all conditions precedent with respect to such Defeasance or Covenant Defeasance have been complied with. (x) No event or condition shall exist that, pursuant to the provisions of Article 16 hereof, would prevent the Company from making payments of the principal of or interest on the Securities of such series on the date of such deposit or at any time during the period ending on the 91st day after the date of such deposit (it being understood that this condition shall not be deemed satisfied until the expiration of such period). 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 of 1940, as amended, unless such trust shall be qualified under such Act or exempt from regulation thereunder. SECTION 11.05 DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS Subject to the provisions of Section 6.04(e) hereof, all money and U.S. Government Obligations (or other property as may be provided pursuant to Section 3.01 hereof) (including the proceeds thereof) deposited with the Trustee or other qualifying trustee (solely for purposes of this Section 11.05 and Section 11.06 hereof, the Trustee and any such other trustee are referred to collectively as the "Trustee") pursuant to Section 11.04 hereof in respect of the Outstanding Securities of any Defeasible Series shall be held in trust and applied by the Trustee, in accordance with the provisions of the Outstanding Securities of such series 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 interest, but such money so held in trust need not be segregated from other funds except to the extent required by law. 67 78 The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S. Government Obligations deposited pursuant to Section 11.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge that by law is for the account of the Holders of Outstanding Securities. Anything in this Article 11 to the contrary notwithstanding, the Trustee shall deliver or pay to the Company any money or U.S. Government Obligations (or other property and any proceeds therefrom) held by it with respect to Outstanding Securities of any Defeasible Series that are in excess of the amount thereof that was used to pay the Securities of such series upon Maturity. SECTION 11.06 REINSTATEMENT If the Trustee or the Paying Agent is unable to apply any money in accordance with this Article 11 with respect to the Securities of any series by reason of any notification, order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company's obligations under this Indenture and the Securities of such series shall be revived and reinstated as though no deposit had occurred pursuant to this Article 11 with respect to Securities of such series until such time as the Trustee or Paying Agent is permitted to apply all money held in trust pursuant to Section 11.05 hereof with respect to Securities of such series in accordance with this Article 11; provided, however, that if the Company makes any payment of principal of or interest on any Security of such series following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of Securities of such series to receive such payment from the money so held in trust. ARTICLE 12 SATISFACTION AND DISCHARGE SECTION 12.01 SATISFACTION AND DISCHARGE OF INDENTURE This Indenture shall upon Company Request cease to be of further effect with respect to any series of Securities (except as to any surviving rights of registration of transfer or exchange of Securities of such series herein expressly provided for) and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture as to such series when (i) either (A) all Securities of such series theretofore authenticated and delivered (other than (i) Securities of such series which have been destroyed, lost or stolen 68 79 and which have been replaced or paid as provided in Section 3.06 hereof, and (ii) Securities of such series for whose payment money has theretofore been deposited in trust with the Trustee or any Paying Agent or segregated and held in trust by the Company and thereafter repaid to the Company, as provided in Section 6.04 hereof) have been delivered to the Trustee for cancellation; or (B) all Securities of such series and, in the case of (1) or (2) below, not theretofore delivered to the Trustee for cancellation (1) have become due and payable, or (2) will become due and payable at their Stated Maturity within one year, or (3) if redeemable at the option of the Company, are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company, and the Company, in the case of (1), (2) or (3) above, has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust for such purpose an amount in cash sufficient to pay and discharge the entire Indebtedness on such Securities not theretofore delivered to the Trustee for cancellation, for principal 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; (ii) the Company has paid or caused to be paid all other sums payable hereunder by the Company; and (iii) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture as to such series have been complied with. Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 9.07 hereof and, if money shall have been deposited with the Trustee pursuant to subclause (B) of clause (i) of this Section 12.01, the obligations of the Trustee under Sections 12.02 and 6.04(e) hereof shall survive. 69 80 SECTION 12.02 APPLICATION OF TRUST MONEY Subject to the provisions of Section 6.04(e) hereof, all money deposited with the Trustee pursuant to Section 12.01 hereof shall be held in trust and applied by it, in accordance with the provisions of the Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal and interest for whose payment such money has been deposited with the Trustee; but such money need not be segregated from other funds except to the extent required by law. ARTICLE 13 SUPPLEMENTAL INDENTURES SECTION 13.01 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS (a) The Company and the Trustee may amend this Indenture or the Securities or waive any provision hereof without the consent of any Holder: (i) to cure any ambiguity, defect or inconsistency; (ii) to comply with Section 7.01 hereof; (iii) to provide for uncertificated Securities in addition to certificated Securities; (iv) to make any change that does not adversely affect the legal rights hereunder of any Holder of a Security of any series; (v) to add to the covenants of the Company 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; (vi) to add any additional Events of Default for the benefit of the Holders of all or any series of Securities (and if such Events of Default are to be for the benefit of less then all series of Securities, stating that such Events of Default are being included solely for the benefit of such series); 70 81 (vii) to change or eliminate any of the provisions of this Indenture in respect of one or more series of Securities; provided that any such addition, 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; (viii) to establish the form or terms of Securities of any series as permitted by Sections 2.01 and 3.01 hereof; (ix) to evidence and provide for the acceptance of appointment hereunder of a successor Trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 9.08 hereof; (x) to supplement any of the provisions of the Indenture to such extent as shall be necessary to implement the provisions of Article 11 hereof or discharge of any series of Securities pursuant to Sections 12.01, 12.02 and 12.03 hereof; provided that any such action shall not adversely affect the interests of the Holders of Securities of such series or any other series in any material respect; or (xi) to comply with the qualification of this Indenture under the TIA. (b) Upon the request of the Company, accompanied by a Board Resolution authorizing the execution of any such supplemental indenture, and upon receipt by the Trustee of the documents described in Section 13.06 hereof, the Trustee will join with the Company in the execution of any supplemental indenture authorized or permitted by the terms of this Indenture and make any further appropriate agreements and stipulations that may be contained therein. After an amendment or waiver under this Section 13.01 becomes effective, the Company will mail to the Holders of each Security affected thereby a notice describing the amendment or waiver. Any failure of the Company to mail such notice, will not, however, affect the validity of any such supplemental indenture. SECTION 13.02 SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS (a) Except as provided below in this Section 13.02, the Company and the Trustee may amend this Indenture or the Securities with the written consent (including consents obtained in connection with a tender offer or exchange offer for Securities) of the Holders of at least a majority in principal amount of the Outstanding Securities of each series affected by such amendment. 71 82 (b) Upon the request of the Company, accompanied by a Board Resolution authorizing the execution of any such supplemental indenture, and upon the filing with the Trustee of evidence of the consent of the Holders as aforesaid, and upon receipt by the Trustee of the documents described in Section 13.06 hereof, the Trustee will join with the Company in the execution of such supplemental indenture. (c) It will not be necessary for the consent of the Holders under this Section 13.02 to approve the particular form of any proposed amendment or waiver, but it will be sufficient if such consent approves the substance thereof. (d) The Holders of a majority in principal amount of the Outstanding Securities of each series affected may waive compliance in a particular instance by the Company with any provision of this Indenture (including waivers obtained in connection with a tender offer or exchange offer for Securities). However, without the consent of each Holder of an Outstanding Security affected thereby, an amendment or waiver under this Section 13.02 may not: (i) change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Security, or reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or change the Place of Payment where any Security or interest thereon is payable, or change 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 or repayment at the option of the Holder, on or after the redemption date or repayment date), or (ii) reduce the percentage in principal amount of the Outstanding Securities of any series, the consent of whose Holders is required for any such amendment, 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 (iii) modify any of the provisions of this Section or Section 8.07, 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, or (iv) modify the provisions of this Indenture relating to the subordination of the Securities in a manner adverse to the Holders. 72 83 (e) A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture 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. (f) The right of any Holder to participate in any consent required or sought pursuant to any provision of this Indenture (and the obligation of the Company to obtain any such consent otherwise required from such Holder) may be subject to the requirement that such Holder has been the Holder of record of any Securities of any series with respect to which such consent is required or sought as of a date identified by the Trustee in a notice furnished to Holders in accordance with the terms of this Indenture. SECTION 13.03 COMPLIANCE WITH TIA Every amendment to this Indenture or the Securities will comply in form and substance with the TIA as then in effect. SECTION 13.04 REVOCATION AND EFFECT OF CONSENTS (a) Until an amendment (which includes any supplement) or waiver becomes effective, a consent to it by a Holder of a Security of any series is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder's Security, even if notation of the consent is not made on any Security. However, any such Holder or subsequent Holder may revoke the consent as to such Holder's Security or portion of a Security if the Trustee receives written notice of revocation before the date the amendment or waiver becomes effective. An amendment or waiver becomes effective in accordance with its terms and thereafter binds every Holder. (b) The Company may, but will not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment or waiver. If the Company elects to fix a record date for such purpose, the record date will be fixed at (i) the later of 30 days prior to the first solicitation of such consent or the date of the most recent list of Holders furnished to the Trustee prior to such solicitation pursuant to Section 10.02 hereof or (ii) such other date as the Company will designate. If a record date is fixed, then notwithstanding the provisions of Section 13.04(a) hereof, those Persons who were Holders at such record date (or their duly designated proxies), and only those Persons, will be entitled to consent to such amendment or waiver or to revoke any consent previously given, whether or not such Persons continue to be Holders after such record date. No consent will be valid or effective for more than 90 days unless consents from Holders of the principal amount of Securities required hereunder for such amendment or waiver to be effective has also been given and not revoked within such 90-day period. 73 84 (c) After an amendment or waiver becomes effective it will bind every Holder of a Security of any series affected thereby, unless it is of the type described in any of clauses (i) through (iv) of Section 13.02(d) hereof. Any amendment or waiver will bind each Holder of a Security who has consented to it and every subsequent Holder of a Security that evidences the same debt as the consenting Holder's Security. SECTION 13.05 NOTATION ON OR EXCHANGE OF SECURITIES The Trustee may place an appropriate notation about an amendment or waiver on any Security of any series affected thereby thereafter authenticated. The Company in exchange for all Securities of such series may issue and the Trustee will authenticate new Securities of such series that reflect the amendment or waiver. SECTION 13.06 TRUSTEE TO SIGN AMENDMENTS, ETC. The Trustee will sign any amendment or supplemental indenture authorized pursuant to this Article 13 if the amendment does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may, but need not, sign it. In signing or refusing to sign such amendment or supplemental indenture, the Trustee will be entitled to receive and, subject to Section 9.01 hereof, will be fully protected in relying upon, an Officers' Certificate and an Opinion of Counsel as conclusive evidence that such amendment or supplemental indenture is authorized or permitted by this Indenture, that it is not inconsistent herewith, and that it will be valid and binding upon the Company in accordance with its terms. SECTION 13.07 SUBORDINATION UNIMPAIRED. This Indenture may not be amended to alter the subordination of any Outstanding Securities without the written consent of each holder of Senior Indebtedness then outstanding that would be adversely affected thereby. ARTICLE 14 MISCELLANEOUS SECTION 14.01 TIA CONTROLS If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by TIA Section 318(c), the imposed duties will control. 74 85 SECTION 14.02 NOTICES (a) Any notice or communication by the Company or the Trustee to the other is duly given if in writing and delivered in person or mailed by first class mail (registered or certified, return receipt requested), telex, telecopier or overnight air courier guaranteeing next day delivery, to the other's address: If to the Company: U.S. Home Corporation 1800 West Loop South Houston, Texas 77027 Telecopier No.: (713) 877-2387 Confirmation No.: (713) 877-2311 Attention: President If to the Trustee: IBJ Schroder Bank & Trust Company One State Street New York, New York 10004 Telecopier No.: (212) 858-2952 Confirmation No.: (212) 858-2529 Attention: Corporate Trust Agency & Administration (b) The Company or the Trustee, by notice to the other, may designate additional or different addresses for subsequent notices or communications. (c) All notices and communications will be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, if mailed; when answered back, if telexed; when receipt acknowledged by the Trustee's transmission result report, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery. (d) Any notice or communication to a Holder will be mailed by first-class, postage-prepaid mail, return receipt requested, to the Holder's address shown on the register kept by the Registrar. Failure to mail a notice or communication to a Holder or any defect in it will not affect its sufficiency with respect to other Holders. (e) If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it. 75 86 (f) If the Company mails a notice or communication to Holders, it will mail a copy to the Trustee and each Agent at the same time. SECTION 14.03 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS Holders may communicate pursuant to TIA Section 312(b) with other Holders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Securities Register and anyone else will have the protection of TIA Section 312(c). SECTION 14.04 ACTION BY SECURITYHOLDERS Whenever in this Indenture it is provided that the Holders of a specified percentage in aggregate principal amount of the Outstanding Securities may take any action (including the making of any demand or request, the giving of any notice, consent or waiver or the taking of any other action), the fact that at the time of taking any such action the Holders of such specified percentage have joined therein may be evidenced by any instrument or any number of instruments of similar tenor executed by (i) Holders in person or (ii) agent or proxy appointed in writing, or by the record of the Holders in favor thereof, at any meeting of Holders duly called and held in accordance with the provisions of Article 15 hereof, or (iii) a combination of such instrument or instruments of any such record of such meeting of Holders, but in each case only to the extent that the Holders shall not have revoked such action pursuant to Section 13.04 hereof. Without limiting the generality of this Section 14.04, a Holder, including a Depository that is a Holder of one or more Global Securities, may make, give or take, by a proxy or proxies duly appointed in writing, any request, demand, authorization, direction, notice, consent, waiver or other action provided in this Indenture to be made, given or taken by Holders and a Depository that is a Holder of one or more Global Securities may provide its proxy or proxies to the beneficial owners of interests in any such Global Securities through such Depository's standing instructions and customary practices. The Company, with advance approval by the Trustee, will fix a record date for the purpose of determining the Persons who are beneficial owners of interests in any Global Security held by a Depository entitled under the procedures of such Depository to make, give or take, by a proxy or proxies duly appointed in writing, any request, demand, authorization, direction, notice, consent, waiver or other action provided in this Indenture to be made, given or taken by Holders. If such a record date is fixed, the Persons who are such beneficial owners at the close of business on such record date or their duly appointed proxy or proxies will be entitled to make, give or take such request, demand, authorization, direction, notice, consent, waiver or other actions, whether or not such Persons remain such beneficial owners after such record date. No such request, demand, authorization, direction, notice, consent, waiver or other action will be valid or effective if made, given or taken more than six months after such record date. 76 87 SECTION 14.05 PROOF OF EXECUTION OF INSTRUMENTS AND HOLDING OF SECURITIES Proof of the execution of any instrument by a Holder or such Holder's agent or proxy and proof of the holding by any Person of any of the Securities shall be sufficient if made in the following manner: (1) The fact and date of the execution by any such Person of any instrument may be proved by the certificate of any notary public or other officer of any jurisdiction authorized to take acknowledgments of deeds to be recorded in such jurisdiction that the Person executing such instrument acknowledged to him the execution thereof, or by an affidavit of a witness to such execution sworn to before any such notary or other officer. Such certificate or affidavit shall also constitute sufficient proof of the authority of the Person executing any instrument in cases where Securities are not held by Persons in their individual capacities. (2) The fact and date of execution of any such instrument may also be proved in any other manner which the Trustee deems sufficient. (3) The ownership of Securities shall be proved by the Securities Register for such Security or by a certificate of the Registrar. (4) The Trustee shall not be bound to recognize any Person as a Securityholder unless such Holder's title to any Security held by such Holder is proved in the manner provided in this Section 14.05. The Trustee may require such additional proof of any matter referred to in this Section 14.05 as it shall deem necessary. SECTION 14.06 OBLIGATION TO DISCLOSE BENEFICIAL OWNERSHIP OF SECURITIES All Securities shall be held and owned upon the express condition that, upon demand of any regulatory agency having jurisdiction over the Company, and pursuant to law or regulation empowering such agency to assert such demand, any Holder shall disclose to such agency the identity of the beneficial owner of all Securities held by such Holder. SECTION 14.07 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company will furnish to the Trustee and the Trustee may rely upon, as conclusive evidence: 77 88 (i) an Officers' Certificate (which will include the statements set forth in Section 14.08 hereof) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been complied with; and (ii) an Opinion of Counsel (which will include the statements set forth in Section 14.08 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been complied with. SECTION 14.08 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION (a) Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA Section 314(a)(4)) will include: (i) a statement that the Person making such certificate or opinion has read such condition or covenant; (ii) 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; (iii) a statement that, in the opinion of such Person, such Person has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such condition or covenant has been complied with; and (iv) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with. (b) Any Officers' Certificate may be based, insofar as it relates to legal matters, upon an Opinion of Counsel, unless such Officer knows that the opinion with respect to the matters upon which his certificate may be based as aforesaid is erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any Opinion of Counsel may be based, insofar as it relates to factual matters, upon the certificate, statement or opinion of or representations by an officer or officers of the Company, or other Persons or firms deemed appropriate by such counsel, unless such counsel has actual knowledge that the certificate, statement or opinion or representations with respect to the matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous. (c) Any Officers' Certificate, statement or Opinion of Counsel may be based, insofar as it relates to accounting matters, upon a certificate or opinion of or representation by an 78 89 accountant (who may be an employee of the Company), or firm of accountants, unless such Officer or counsel, as the case may be, has actual knowledge that the certificate or opinion or representation with respect to the accounting matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous. SECTION 14.09 RULES BY TRUSTEE AND AGENTS The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions. SECTION 14.10 NO RECOURSE AGAINST OTHERS A director, officer or employee of the Company, as such, will have no liability for any obligations of the Company under the Securities or this Indenture. Each Holder by accepting a Security waives and releases all such liability. SECTION 14.11 GOVERNING LAW This Indenture and the Securities will be governed by and construed in accordance with the laws of the State of New York, without regard to principles of conflicts of law. SECTION 14.12 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary thereof. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. This writing constitutes the entire agreement of the parties with respect to the subject matter hereof. Unless expressly otherwise indicated herein, an action or transaction permitted by one provision hereof must nonetheless comply with all other applicable provisions hereof; and any action or transaction not permitted by any provision of this Indenture will not be permitted regardless of whether any other provision hereof might permit such action or transaction. SECTION 14.13 SUCCESSORS All agreements of the Company in this Indenture and the Securities will bind its successors. All agreements of the Trustee in this Indenture will bind its successors. 79 90 SECTION 14.14 SEVERABILITY In case any provision in this Indenture or in the Securities is invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby. SECTION 14.15 COUNTERPART ORIGINALS The parties may sign any number of copies of this Indenture. Each signed copy will be an original, but all of them together represent the same agreement. SECTION 14.16 TRUSTEE AS PAYING AGENT AND REGISTRAR The Company initially appoints the Trustee as Paying Agent and Registrar. SECTION 14.17 TABLE OF CONTENTS, HEADINGS, ETC. The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof and will in no way modify or restrict any of the terms or provisions hereof. SECTION 14.18 BENEFITS OF INDENTURE Nothing in this Indenture or in the Securities, express or implied, will give to any Person, other than the parties hereto and their successors hereunder, the holders of Senior Indebtedness and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture. SECTION 14.19 ACCEPTANCE OF TRUST IBJ Schroder Bank & Trust Company, the Trustee named herein, hereby accepts the trusts in this Indenture declared and provided, upon the terms and conditions hereinabove set forth. 80 91 ARTICLE 15 MEETINGS OF HOLDERS OF SECURITIES SECTION 15.01 PURPOSES OF MEETINGS A meeting of Holders may be called at any time and from time to time pursuant to the provisions of this Article 15 for any of the following purposes: (A) to give any notice to the Company or to the Trustee, or to give any direction to the Trustee, or to waive any non-performance hereunder, and its consequences, or to take any other action authorized to be taken by Holders pursuant to any of the provisions of this Indenture; (B) to remove the Trustee and appoint a successor Trustee pursuant to the provisions of Section 9.08 hereof; (C) to consent to the amendment of the provisions contained herein and the execution of an indenture or indentures supplemental hereto pursuant to the provisions of Article 13 hereof; or (D) to take any other action authorized to be taken by or on behalf of the Holders of any specified aggregate principal amount of the Outstanding Securities under any other provision of this Indenture or under applicable law. SECTION 15.02 CALL OF MEETINGS BY TRUSTEE The Trustee may at any time call a meeting of Holders to take any action specified in Section 15.01, to be held at such time and at such place in the State of New York, as the Trustee shall determine. Notice of each meeting of the Holders of Securities, setting forth the time and the place of such meeting and, in general terms, the action proposed to be taken at such meeting, shall be mailed by the Trustee to the Holders, not less than 20 nor more than 60 days prior to the date fixed for the meeting, at their last addresses as they shall appear on the Security Register. SECTION 15.03 CALL OF MEETINGS BY COMPANY OR SECURITYHOLDERS If at any time the Company, pursuant to a Board Resolution, or the Holders of at least 20 percent in aggregate principal amount of the Outstanding Securities, shall have requested the Trustee to call a meeting of Holders to take any action authorized in Section 15.01 hereof, by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have mailed notice of such meeting within 20 days after receipt of such 81 92 request, then the Company or the Holders in the amount above specified may determine the time and the place in the State of New York for such meeting, and may call such meeting by mailing notice thereof as provided in Section 15.02. SECTION 15.04 PERSON ENTITLED TO VOTE AT MEETING To be entitled to vote at any meeting of Holders, a Person shall be a Holder or be a Person appointed by an instrument in writing as proxy by a Holder. The only Persons who shall be entitled to be present or speak at any meeting of the Holders shall be the Persons entitled to vote at such meeting and their counsel and any representatives of the Company and its counsel. SECTION 15.05 REGULATIONS FOR MEETING Notwithstanding any provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Holders in regard to the appointment of proxies, the proof of the holding of Securities, the appointment and duties of inspectors of votes, the submission and examination of proxies and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall think fit. Except as otherwise permitted or required by any such regulations, the holding of Securities shall be proved in the manner specified in Section 14.05 hereof and the appointment of any proxy shall be proved in the manner specified in such Section 14.05 or by having the signature of the person executing the proxy witnessed or guaranteed by any bank, banker, trust company or New York Stock Exchange, Inc. member firm satisfactory to the Trustee. The Trustee shall, by an instrument in writing, appoint a temporary chairperson of the meeting, unless the meeting shall have been called by the Company or by the Holders as provided in Section 15.03, in which case the Company or the Holders calling the meeting, as the case may be, shall appoint a temporary chairman. A permanent chairperson and a permanent secretary of the meeting shall be elected by vote of the Holders of a majority in principal amount of the Securities represented at the meeting and entitled to vote. At any meeting of Holders, the presence of Persons holding or representing Securities in an aggregate principal amount sufficient to take action upon the business for the transaction of which such meeting was called shall be necessary to constitute a quorum; but, if less than a quorum be present, the Persons holding or representing a majority in aggregate principal amount of the Securities represented at the meeting may adjourn such meeting with the same effect, for all intents and purposes, as though a quorum had been present. 82 93 ARTICLE 16 SUBORDINATION; SENIORITY SECTION 16.01 SECURITIES SUBORDINATED TO SENIOR INDEBTEDNESS (a) The Company agrees, and each Holder of a Security of any series by such Holder's acceptance thereof likewise agrees, that the payment of the principal of, and interest on (including, without limitation, interest accruing subsequent to the filing of a petition under applicable Bankruptcy Law or the appointment of a Custodian), the Securities of each series hereunder is subordinated and junior in right of payment, to the extent and in the manner provided in this Article 16, except as provided in Section 9.07, to the prior payment in full in cash or Cash Equivalents or all Senior Indebtedness whether outstanding on the Issue Date of the Securities of any series or created, incurred, assumed or guaranteed thereafter. The Securities of any series shall rank senior to the Company's 4 7/8% Convertible Subordinated Debentures due 2005 and shall constitute "Senior Indebtedness" for the purposes of the Indenture, dated as of November 3, 1993, between the Company and Marine Midland Bank, N.A., as trustee, relating to such Convertible Subordinated Debentures. (b) All the provisions of this Indenture and the Securities of any series will be subject to the provisions of this Article 16 so far as they may be applicable thereto, except that nothing in this Article 16 will apply to claims for, or payments to, the Trustee under or pursuant to Section 9.07 hereof. SECTION 16.02 COMPANY NOT TO MAKE PAYMENTS WITH RESPECT TO SECURITIES IN CERTAIN CIRCUMSTANCES (a) No payment will be made by the Company on account of principal of or interest on the Securities of any series, nor may the Company purchase or otherwise acquire such Securities for cash or property (other than Capital Stock or other securities of the Company that are subordinated to Senior Indebtedness to at least the same extent as the Securities) if at the time of such payment or immediately after giving effect thereto there will have occurred and be continuing (i) a default in the payment of principal of (or premium, if any, on) or interest on any Designated Senior Indebtedness continuing beyond the applicable period of grace, if any, specified in the applicable instrument, lease, contract, agreement or other document evidencing such Designated Senior Indebtedness or (ii) a default, other than a payment default as specified in clause (i) of this section 16.02(a), that permits the holders of Designated Senior Indebtedness to accelerate the maturity thereof, and the Trustee shall have received notice thereof from the trustee or other representative of the holders of Designated Senior Indebtedness, which notice shall request that payment of principal or interest on the Securities be prohibited (provided, however, that in the case of Designated Senior Indebtedness issued pursuant to an indenture, such notice may be validly given only by the trustee under such indenture), provided, that the foregoing will not prohibit payments made pursuant to Articles 11 or 12 hereof from monies 83 94 deposited with the Trustee pursuant thereto prior to any such default, judicial proceeding or notice. (b) Notwithstanding Section 1602(a) hereof, the Company shall resume payments on the Securities of any series and may acquire such Securities upon the earlier of: (i) the date upon which the default or event of default as specified in Section 16.02(a) hereof is cured or waived or ceases to exist, or (ii) in the case of an event of default as specified in clause (ii) of Section 16.02(a), the expiration of 179 days after such notice as set forth in such clause (ii) of Section 16.02(a) is received (each such period under this clause (ii) of Section 16.02(b), a "Payment Blockage Period"). Notwithstanding anything in this Section 16.02(b) to the contrary, (A) only one such Payment Blockage Period may be commenced within any 365 consecutive day period and (B) in no event will a Payment Blockage Period extend beyond 179 days from the date the payment on the Securities of any series is due. For purposes of this Section 16.02, no default which, to the knowledge of the trustee or other representative of Designated Senior Indebtedness, existed or was continuing on the date of the commencement of any Payment Blockage Period shall be, or be made, the basis for the commencement of a second Payment Blockage Period by such trustee or representative, whether or not within a period of 365 consecutive days, unless such default shall have been cured or waived or shall have ceased to exist, or the benefits of this Section 16.02(b) shall have been waived in writing by such trustee or representative for a period of not less than 90 consecutive days. (c) Upon any acceleration of the principal of the Securities of any series or any payment by the Company, or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to creditors upon any dissolution or winding up or liquidation or reorganization of the Company, whether voluntary or involuntary, or in bankruptcy, insolvency, receivership or other proceedings, all amounts due or to become due upon all Senior Indebtedness (including, without limitation, interest accruing subsequent to the filing of a petition under applicable Bankruptcy Law or the appointment of a Custodian) will first be paid in full in cash or Cash Equivalents, or payment thereof provided for, before any payment is made on account of the principal of or interest on the Securities (except payments made pursuant to Articles 11 or 12 hereof from monies deposited with the Trustee pursuant thereto prior to the happening of such dissolution, winding up, liquidation or reorganization); and upon any such dissolution or winding up or liquidation or reorganization, any payment by the Company, or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to which the Holders or the Trustee would be entitled except for the provisions of this Article 16, will (except as aforesaid) be paid by the Company or by any Custodian or other Person, or by the Holders or the Trustee, making such payment or distribution directly to the holders of Senior Indebtedness (pro rata to such holders on the basis of the respective amounts of Senior Indebtedness held by such holders, as calculated by the Company) or their representative or representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing any Senior Indebtedness may have been issued, as their respective interests may appear, to the extent necessary so that the holders of all Senior Indebtedness have been paid in full in cash or Cash Equivalents, after giving effect to any concurrent payment or distribution to or for the holders of Senior Indebtedness, before any payment or distribution is made to the Holders or to the Trustee, except that Holders shall be entitled to receive securities that are subordinated to Senior Indebtedness to at least the same extent as the Securities. (d) If the Trustee or any Holder does not file a proper claim or proof of debt in the form required in any proceeding referred to above prior to 30 days before the expiration of the time to file such claim in such proceeding, then the holder of any Senior Indebtedness is hereby authorized, and has the right, to file an appropriate claim or claims for or on behalf of the Trustee or such Holder. (e) In the event that, notwithstanding the foregoing, any payment by or distribution of assets of the Company of any kind or character, whether in cash, property or securities, prohibited by the foregoing, is received by the Trustee or the Holders before all Senior Indebtedness is paid in full in cash or Cash Equivalents, or provision is made for such payment in cash or Cash Equivalents, such payment or distribution will be paid over or delivered to the holders of Senior Indebtedness or their representative or representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing any Senior Indebtedness may have been issued, as their respective interests may appear, for application to 84 95 the payment of all Senior Indebtedness remaining unpaid to the extent necessary to pay the holders of all Senior Indebtedness in full in cash or Cash Equivalents, after giving effect to any concurrent payment or distribution to or for the holders of such Senior Indebtedness, and, until so delivered, the same will be held in trust by the Trustee or any Holder as the property of the holders of Senior Indebtedness (but subject to the power of a court of competent jurisdiction to make other equitable provision, which will have been determined by such court to give effect to the rights conferred in this Article 16 upon the Senior Indebtedness and the holders thereof with respect to the Securities or the Holders or the Trustee, by a lawful plan of reorganization or readjustment under applicable Bankruptcy Laws). The Trustee will not have any obligation or duty to recover any such amounts so distributed. (f) The consolidation of the Company with, or the merger of the Company into, another corporation or the liquidation or dissolution of the Company following the conveyance or transfer of its property as an entirety, or substantially as an entirety, to another corporation upon the terms and conditions provided in Article 7 hereof will not be deemed a dissolution, winding up, liquidation or reorganization for the purposes of this Section 16.02 if such other corporation will, as a part of such consolidation, merger, conveyance or transfer, comply with the conditions stated in Article 7 hereof. Nothing in this Section 16.02 will apply to claims of, or payments to, the Trustee under or pursuant to Section 9.07 hereof. (g) The holders of Senior Indebtedness may, at any time and from time to time, without the consent of, or notice to, the Holders or the Trustee, without incurring responsibility to the Holders or the Trustee and without impairing or releasing the rights of any holder of Senior Indebtedness or in any way altering or affecting any of the provisions of this Article 16: (i) change the amount, manner, place or terms of payment or change or extend the time of payment of, or renew or alter, Senior Indebtedness, or otherwise amend in any manner Senior Indebtedness or any instrument evidencing the same or any agreement under which Senior Indebtedness is outstanding, (ii) sell, exchange, release or otherwise deal with any property pledged, mortgaged or otherwise securing Senior Indebtedness, (iii) release any Person liable in any manner for the collection of Senior Indebtedness, and (iv) exercise or refrain from exercising any rights against the Company and any other Person. SECTION 16.03 SUBROGATION OF SECURITIES (a) Subject to the payment in full of all Senior Indebtedness at the time outstanding, the Holders will be subrogated (without any duty on the part of the holders of Senior Indebtedness to warrant, create, effectuate, preserve or protect each subrogation) to the rights of the holders of Senior Indebtedness to receive payments or distributions of cash, property or securities of the Company applicable to the Senior Indebtedness until the principal of and interest on the Securities of each series will be paid in full; and, for the purposes of such subrogation, no payments or distributions to the holders of Senior Indebtedness of any cash, property or securities to which the Holders or the Trustee on their behalf would be entitled except for the 85 96 provisions of this Article 16, and no payments over pursuant to the provisions of this Article 16, to the holders of Senior Indebtedness by Holders or the Trustee on their behalf will, as between the Company, its creditors (other than holders of Senior Indebtedness), and the Holders, be deemed to be a payment by the Company to or on account of the Senior Indebtedness. It is understood that the provisions of this Article 16 are and are intended solely for the purpose of defining the relative rights of the Holders, on the one hand, and the holders of Senior Indebtedness, on the other. (b) Nothing contained in this Article 16 or elsewhere in this Indenture or in the Securities of any series is intended to or will impair, as among the Company, its creditors other than the holders of Senior Indebtedness and the Holders, the obligation of the Company, which is absolute and unconditional, to pay to the Holders the principal of and interest on the Securities of each series as and when the same will become due and payable in accordance with their terms, or is intended to or will affect the relative rights of the Holders and creditors of the Company other than the holders of Senior Indebtedness, nor will anything herein or therein prevent the Trustee or any Holder from exercising all remedies otherwise permitted by applicable law upon default under this Indenture, subject to the rights, if any, under this Article 16 of the holders of Senior Indebtedness in respect of cash, property or securities of the Company received upon the exercise of any such remedy. (c) Upon any payment or distribution of assets of the Company referred to in this Article 16, the Trustee and the Holders will be entitled to rely upon any order or decree made by any court of competent jurisdiction in which such dissolution, winding up, liquidation or reorganization proceedings are pending, or certificate of the Custodian or other Person making such payment or distribution, delivered to the Trustee or to the Holders, for the purpose of ascertaining the holders of Senior Indebtedness and other Indebtedness of the Company and the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article 16. SECTION 16.04 AUTHORIZATION BY HOLDERS Each Holder by such Holder's acceptance of a Security of any series authorizes and directs the Trustee on such Holder's behalf to take such action as may be necessary or appropriate to effectuate, as between the Holder and the holders of Senior Indebtedness, the subordination provided in this Article 16 and appoints the Trustee such Holder's attorney-in-fact for any and all such purposes. SECTION 16.05 NOTICES TO TRUSTEE (a) The Company will give prompt written notice in the form of an Officers' Certificate to the Trustee of any fact known to the Company which would prohibit the making of any payment of monies to or by the Trustee in respect of the Securities of any series pursuant to 86 97 the provisions of this Article 16. Notwithstanding the provisions of this Article 16 or any other provision of this Indenture, the Trustee will not be charged with knowledge of the existence of any facts which would prohibit the making of any payment of monies to or by the Trustee in respect of the Securities of any series pursuant to the provisions of this Article 16, unless and until the Trustee will have received at its Corporate Trust Office written notice thereof from the Company or a holder or holders of Senior Indebtedness or from a representative or trustee therefor; provided, that in the case of Senior Indebtedness issued pursuant to an indenture, such notice may be validly given only by the trustee under such indenture; and before the receipt of any such written notice, the Trustee will be entitled in all respects to assume that no such facts exist; provided further that if the Trustee will not have received, at least three Business Days prior to the date upon which by the terms hereof any such monies may become payable for any purpose (including, without limitation, the payment of the principal of or interest on any Security of any series), with respect to such monies, the notice provided for in this Section 16.05, then, anything herein contained to the contrary notwithstanding, the Trustee will have the full power and authority to receive such monies and to apply the same to the purpose for which they were received and will not be affected by any notice to the contrary which may be received by it within three Business Days prior to such date. (b) The Trustee will be entitled to rely on the delivery to it of a written notice by a Person representing himself or herself to be a holder of Senior Indebtedness (or a trustee on behalf of such holder) to establish that such notice has been given by a holder of Senior Indebtedness or a trustee or a representative on behalf of any 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 to participate in any payment or distribution pursuant to this Article 16, the Trustee may request such Person to provide evidence to the reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such Person under this Article 16, 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. (c) Notwithstanding anything to the contrary hereinbefore set forth, nothing will prevent any payment by the (i) Company or the Trustee to the Holders of monies in connection with a redemption of Securities of any series if (A) notice of such redemption had been given pursuant to Article 4 hereof prior to the receipt by the Company or the Trustee, as applicable, of written notice as aforesaid, and (B) such notice of redemption is given not earlier than 60 days before the redemption date, or (ii) Trustee to the Holders of amounts deposited with it pursuant to Articles 11 or 12 hereof. (d) The Company agrees that if any default occurs with respect to any Senior Indebtedness, which default permits the holders of such Senior Indebtedness to accelerate the maturity thereof, the Company will give prompt notice in writing of such happening to all known 87 98 holders of Senior Indebtedness and will certify to each such holder the name of the Trustee and current notice address. SECTION 16.06 TRUSTEE'S RELATION TO SENIOR INDEBTEDNESS (a) The Trustee in its individual capacity will be entitled to all the rights set forth in this Article 16 in respect of any Senior Indebtedness at any time held by it, to the same extent as any other holder of Senior Indebtedness, and nothing in Section 9.03 or elsewhere in this Indenture will deprive the Trustee of any of its rights as such holder. (b) With respect to the holders of Senior Indebtedness, the Trustee undertakes to perform or to observe only such of its covenants and obligations as are specifically set forth in this Article 16, and no implied covenants or obligations with respect to the holders of Senior Indebtedness will be read into this Indenture against the Trustee. The Trustee will not owe any fiduciary duty to the holders of Senior Indebtedness but will have only such obligations to such holders as are expressly set forth in this Article 16. SECTION 16.07 NO IMPAIRMENT OF SUBORDINATION No right of any present or future holder of any Senior Indebtedness to enforce subordination as herein provided will 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 an 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 which any such holder may have or otherwise be charged with. SECTION 16.08 ARTICLE 16 NOT TO PREVENT EVENTS OF DEFAULT No provision of this Article 16 will prevent the occurrence of an Event of Default hereunder. SECTION 16.09 PAYING AGENTS OTHER THAN THE TRUSTEE In any case at any time any Paying Agent other than the Trustee has been appointed by the Company and be then acting hereunder, the term "Trustee" as used in this Article 16 will in such case (unless the context will otherwise require) be construed as extending to and including such Paying Agent within its meaning as fully for all intents and purposes as if such place of the Trustee; provided, however, that Sections 16.05 and 16.06 hereof will not apply to the Company or any Subsidiary if it acts as Paying Agent. 88 99 IN WITNESS WHEREOF, the undersigned have duly executed this Indenture as of the date first above written. U.S. HOME CORPORATION By:_____________________________________ IBJ SCHRODER BANK & TRUST COMPANY, as Trustee By:_____________________________________ Name: Title: 89 EX-4.3 4 FORM OF SUBORDINATED INDENTURE 1 EXHIBIT 4.3 -------------------------------------- FORM OF SUBORDINATED INDENTURE, DATED AS OF _______ __, 199_, BETWEEN U.S. HOME CORPORATION AND IBJ SCHRODER BANK & TRUST COMPANY TRUSTEE -------------------------------------- 2 CROSS-REFERENCE TABLE TIA SECTION INDENTURE SECTION - ------- ----------------- 310(a)(1)................................................. 9.10 (a)(2)................................................. 9.10 (a)(3)................................................. N.A. (a)(4)................................................. N.A. (b).................................................... 9.08; 9.10 (c).................................................... N.A. 311(a).................................................... 9.11 (b).................................................... 9.11 (c).................................................... N.A. 312(a).................................................... 10.01; 10.02 (b).................................................... 10.02; 14.03 (c).................................................... 10.02 313(a).................................................... 9.06 (b)(1)................................................. 9.06 (b)(2)................................................. 9.06 (c).................................................... 9.06 (d).................................................... 9.06 314(a).................................................... 6.03 (b).................................................... N.A. (c)(1)................................................. 14.04; 14.05 (c)(2)................................................. 14.04; 14.05 (c)(3)................................................. 14.05 (d).................................................... N.A. (e).................................................... 14.05 (f).................................................... N.A. 315(a).................................................... 9.01 (b).................................................... 9.05 (c).................................................... 9.01 (d).................................................... 9.01 (e).................................................... 8.11 316(a)(last sentence)..................................... 8.05 (a)(1)(A).............................................. 8.05 (a)(1)(B).............................................. 8.04 (a)(2)................................................. Not applicable (b).................................................... 8.07 3 317(a)(1)................................................. 8.08 (a)(2)................................................. 8.09 (b).................................................... 3.05 318(a).................................................... 14.01 N.A. means not applicable NOTE: This cross-reference table will not, for any purpose, be deemed to be a part of this Indenture. 2 4 TABLE OF CONTENTS Page ---- ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE...................... 1 Section 1.01 Rules of Construction.................................... 1 Section 1.02 Definitions.............................................. 2 Affiliate................................................ 2 Agent.................................................... 2 Bankruptcy Law........................................... 2 Board of Directors....................................... 2 Board Resolution......................................... 2 Business Day............................................. 2 Capital Stock............................................ 2 Cash Equivalents......................................... 2 Common Equity............................................ 3 Company.................................................. 3 Company Request or Company Order......................... 3 Corporate Trust Office of the Trustee.................... 3 Covenant Defeasance...................................... 3 Custodian................................................ 3 Default.................................................. 3 Defaulted Interest....................................... 3 Defeasance............................................... 3 Defeasible Series........................................ 3 Depository............................................... 3 DTC...................................................... 3 Event of Default......................................... 4 Exchange Act............................................. 4 GAAP..................................................... 4 Global Security.......................................... 4 Holder................................................... 4 Indenture................................................ 4 Interest Payment Date.................................... 4 Issue Date............................................... 4 Legal Holiday............................................ 4 Material Subsidiary...................................... 5 Maturity................................................. 5 Non-Recourse Indebtedness................................ 5 Officer.................................................. 5 Officers' Certificate.................................... 5 i 5 Page ---- Opinion of Counsel...................................... 5 Outstanding............................................. 5 Paying Agent............................................ 6 Person.................................................. 6 Place of Payment........................................ 6 Registrar............................................... 6 Regular Record Date..................................... 6 SEC..................................................... 7 Securities.............................................. 7 Security Register....................................... 7 Senior Indebtedness..................................... 7 Special Record Date..................................... 7 Stated Maturity......................................... 8 Subsidiary.............................................. 8 Successor............................................... 8 TIA..................................................... 8 Trustee................................................. 8 Trust Officer........................................... 8 U.S. Government Obligations............................. 8 Section 1.03 Incorporation by Reference of TIA....................... 9 ARTICLE 2 SECURITY FORMS................................................. 9 Section 2.01 Forms Generally......................................... 9 Section 2.02 Form of Legend for Global Securities.................... 9 Section 2.03 Form of Trustee's Certificate of Authentication......... 10 ARTICLE 3 THE SECURITIES................................................. 11 Section 3.01 Amount Unlimited; Issuable in Series.................... 11 Section 3.02 Denominations........................................... 13 Section 3.03 Execution, Authentication, Delivery and Dating.......... 14 Section 3.04 Temporary Securities.................................... 16 Section 3.05 Registration, Registration of Transfer and Exchange..... 16 Section 3.06 Mutilated, Destroyed, Lost and Stolen Securities........ 20 Section 3.07 Payment of Interest; Interest Rights Preserved.......... 21 Section 3.08 Persons Deemed Owners................................... 22 Section 3.09 Cancellation............................................ 22 Section 3.10 Computation of Interest................................. 23 ARTICLE 4 REDEMPTION..................................................... 23 Section 4.01 Applicability of Article................................ 23 ii 6 Page ---- Section 4.02 Election to Redeem; Notice to Trustee.................. 23 Section 4.03 Selection of Securities to Be Redeemed................. 23 Section 4.04 Notices to Holders..................................... 24 Section 4.05 Effect of Notice of Redemption......................... 24 Section 4.06 Deposit of Redemption Price............................ 25 Section 4.07 Securities Redeemed in Part............................ 25 Section 4.08 Optional Redemption.................................... 25 ARTICLE 5 SINKING FUNDS.................................................. 26 Section 5.01 Applicability of Article............................... 26 Section 5.02 Satisfaction of Sinking Fund Payments with Securities.. 26 Section 5.03 Redemption of Securities for Sinking Fund.............. 26 ARTICLE 6 COVENANTS...................................................... 28 Section 6.01 Payment of Securities.................................. 28 Section 6.02 Maintenance of Office or Agency........................ 28 Section 6.03 SEC Reports; Financial Statements...................... 29 Section 6.04 Money for Security Payments to Be Held in Trust........ 29 Section 6.05 Compliance Certificate................................. 31 Section 6.06 Corporate Existence, etc............................... 31 Section 6.07 Payment of Taxes and Other Claims...................... 31 Section 6.08 Insurance.............................................. 32 Section 6.09 Stay, Extension and Usury Laws......................... 32 Section 6.10 Maintenance of Properties.............................. 32 ARTICLE 7 SUCCESSORS..................................................... 32 Section 7.01 Limitations on Mergers and Consolidations.............. 32 Section 7.02 Successor Corporation Substituted...................... 33 ARTICLE 8 DEFAULTS AND REMEDIES.......................................... 34 Section 8.01 Events of Default...................................... 34 Section 8.02 Acceleration........................................... 36 Section 8.03 Other Remedies......................................... 36 Section 8.04 Waiver of Past Defaults and Compliance With Indenture Provisions............................................. 37 Section 8.05 Control by Majority.................................... 37 Section 8.06 Limitations on Suits................................... 37 Section 8.07 Rights of Holders to Receive Payment................... 38 Section 8.08 Collection Suit by Trustee............................. 38 Section 8.09 Trustee May File Proofs of Claim....................... 38 Section 8.10 Priorities............................................. 39 iii 7 Page ---- Section 8.11 Undertaking for Costs.................................. 39 Section 8.12 Restoration of Rights and Remedies..................... 40 ARTICLE 9 TRUSTEE........................................................ 40 Section 9.01 Duties of Trustee...................................... 40 Section 9.02 Rights of Trustee...................................... 41 Section 9.03 Individual Rights of Trustee........................... 42 Section 9.04 Trustee's Disclaimer................................... 42 Section 9.05 Notice of Defaults..................................... 43 Section 9.06 Reports by Trustee to Holders.......................... 43 Section 9.07 Compensation and Indemnity............................. 43 Section 9.08 Replacement of Trustee................................. 44 Section 9.09 Successor Trustee by Merger, etc....................... 45 Section 9.10 Eligibility; Disqualification.......................... 45 Section 9.11 Preferential Collection of Claims Against Company...... 46 ARTICLE 10 HOLDERS' LISTS................................................. 46 Section 10.01 Company to Furnish Trustee Names and Addresses of Holders................................................ 46 Section 10.02 Preservation of Information............................ 46 ARTICLE 11 DEFEASANCE AND COVENANT DEFEASANCE............................. 47 Section 11.01 Company's Option to Effect Defeasance or Covenant Defeasance............................................. 47 Section 11.02 Defeasance and Discharge............................... 47 Section 11.03 Covenant Defeasance.................................... 47 Section 11.04 Conditions to Defeasance or Covenant Defeasance........ 48 Section 11.05 Deposited Money and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous Provisions....... 50 Section 11.06 Reinstatement.......................................... 51 ARTICLE 12 SATISFACTION AND DISCHARGE..................................... 51 Section 12.01 Satisfaction and Discharge of Indenture................ 51 Section 12.02 Application of Trust Money............................. 52 ARTICLE 13 SUPPLEMENTAL INDENTURES........................................ 53 Section 13.01 Supplemental Indentures Without Consent of Holders..... 53 Section 13.02 Supplemental Indentures With Consent of Holders........ 54 Section 13.03 Compliance With TIA.................................... 56 Section 13.04 Revocation and Effect of Consents...................... 56 Section 13.05 Notation on or Exchange of Securities.................. 57 Section 13.06 Trustee to Sign Amendments, etc........................ 57 Section 13.07 Subordination Unimpaired............................... 57 iv 8 Page ---- ARTICLE 14 MISCELLANEOUS.................................................. 57 Section 14.01 TIA Controls........................................... 57 Section 14.02 Notices................................................ 57 Section 14.03 Communication by Holders With Other Holders............ 59 Section 14.04 Action by Securityholders.............................. 59 Section 14.05 Proof of Execution of Instruments and Holding of Securities.......................................... 60 Section 14.06 Obligation to Disclose Beneficial Ownership of Securities.......................................... 60 Section 14.07 Certificate and Opinion as to Conditions Precedent..... 60 Section 14.08 Statements Required in Certificate or Opinion.......... 61 Section 14.09 Rules by Trustee and Agents............................ 62 Section 14.10 No Recourse Against Others............................. 62 Section 14.11 Governing Law.......................................... 62 Section 14.12 No Adverse Interpretation of Other Agreements.......... 62 Section 14.13 Successors............................................. 62 Section 14.14 Severability........................................... 63 Section 14.15 Counterpart Originals.................................. 63 Section 14.16 Trustee as Paying Agent and Registrar.................. 63 Section 14.17 Table of Contents, Headings, etc....................... 63 Section 14.18 Benefits of Indenture.................................. 63 Section 14.19 Acceptance of Trust.................................... 63 ARTICLE 15 MEETINGS OF HOLDERS OF SECURITIES.............................. 64 Section 15.01 Purposes of Meetings................................... 64 Section 15.02 Call of Meetings by Trustee............................ 64 Section 15.03 Call of Meetings by Company or Securityholders......... 64 Section 15.04 Person Entitled to Vote at Meeting..................... 65 Section 15.05 Regulations for Meeting................................ 65 ARTICLE 16 SUBORDINATION; SENIORITY....................................... 66 Section 16.01 Securities Subordinated to Senior Indebtedness......... 66 Section 16.02 Company Not To Make Payments with Respect to Securities in Certain Circumstances.................... 66 Section 16.03 Subrogation of Securities.............................. 68 Section 16.04 Authorization by Holders............................... 69 Section 16.05 Notices to Trustee..................................... 69 Section 16.06 Trustee's Relation to Senior Indebtedness.............. 71 Section 16.07 No Impairment of Subordination......................... 71 Section 16.08 Article 16 Not to Prevent Events of Default............ 71 Section 16.09 Paying Agents Other Than the Trustee................... 71 v 9 INDENTURE, dated as of _______ __, 199_, between U.S. Home Corporation, a Delaware corporation, and IBJ Schroder Bank & Trust Company, a banking organization organized under the laws of New York, as trustee. RECITALS OF THE COMPANY A. The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured debentures, notes or other evidences of indebtedness (the "Securities") to be issued in one or more series as provided herein. B. All things necessary have been done 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 to make this Indenture a valid agreement of the Company. NOW, THEREFORE, in consideration of the above premises and the acquisition 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 1 DEFINITIONS AND INCORPORATION BY REFERENCE SECTION 1.01 RULES OF CONSTRUCTION For all purposes of this Indenture, 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 accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP; (c) 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 hereof; (d) "or" is not exclusive; and (e) provisions apply to successive events and transactions. 10 SECTION 1.02 DEFINITIONS Capitalized terms used herein will have the following respective meanings when used herein: "Affiliate" of any Person means any Person directly or indirectly controlling or controlled by, or under direct or indirect common control with, such Person. For purposes of this Indenture, each executive officer and director of the Company will be an Affiliate of the Company. In addition, for purposes of this Indenture, control of a 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. "Agent" means any Registrar or Paying Agent. "Bankruptcy Law" means title 11 of the United States Code, as amended, or any similar federal or state law for the relief of debtors. "Board of Directors" means the board of directors of a Person or any authorized committee of the board of directors of such Person. "Board Resolution" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company 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 a Legal Holiday. "Capital Stock" of any Person means any and all shares, rights to purchase, warrants or options (whether or not currently exercisable), participations, or other equivalents of or interests in (however designated) the equity (which includes, but is not limited to, common stock, preferred stock and partnership and joint venture interests) of such Person (excluding any debt securities that are convertible into, or exchangeable for, such equity). "Cash Equivalents" means any of the following, to the extent owned by the Company, free and clear of all liens and having a maturity of not greater than 90 days from the date of issuance thereof: (i) readily marketable direct obligations of the United States or any agency or instrumentality thereof or obligations unconditionally guaranteed by the full faith and credit of the United States, (ii) insured certificates of deposit of or time deposits with any commercial bank that (a) is a member of the Federal Reserve System, (b) issues (or the parent of which issues) commercial paper rated as described in clause (iii) below, (c) is organized under the laws of the United States or any State thereof and (d) has combined capital and surplus of at least $1,000,000,000 or (iii) commercial paper in an aggregate amount of no more than $5,000,000 per issuer outstanding at any time, issued by any corporation organized under the 2 11 laws of any State of the United States or the District of Columbia that is not an Affiliate of the Company and rated at least "Prime-1" (or the then equivalent grade) by Moody's Investor Service, Inc. or "A-1" (or the then equivalent grade) by Standard & Poor's Corporation. "Common Equity" of any Person means all Capital Stock of such Person that is generally entitled (i) to vote in the election of directors of such Person, or (ii) if such Person is not a corporation, to vote or otherwise participate in the selection of the governing body, partners, managers or others that will control the management and policies of such Person. "Company" means U.S. Home Corporation, a Delaware corporation, and any successor thereof. "Company Request or Company Order" means a written request or order signed in the name of the Company by its Chairman of the Board, its President, its Senior Vice President or a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to the Trustee. "Corporate Trust Office of the Trustee" will be at the address of the Trustee specified in Section 14.02 hereof or such other address as the Trustee may give notice to the Company. "Covenant Defeasance" has the meaning set forth in Section 11.03 hereof. "Custodian" means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law. "Default" means any event, act or condition that is, or after notice or the passage of time or both would be, an Event of Default. "Defaulted Interest" has the meaning set forth in Section 3.07 hereof. "Defeasance" has the meaning set forth in Section 11.02 hereof. "Defeasible Series" has the meaning set forth in Section 11.01 hereof. "Depository" means, with respect to Securities of any series issuable in whole or in part in the form of one or more Global Securities, a clearing agency registered under the Exchange Act that is designated to act as Depository for such Securities as contemplated by Section 3.01. "Designated Senior Indebtedness" means (i) Senior Indebtedness permitted to be incurred pursuant to this Indenture under or in respect of an institutional credit agreement, including the Existing Credit Facility, and (ii) any other Senior Indebtedness permitted to be incurred pursuant to this Indenture the principal amount of which is $25,000,000 or more. "DTC" has the meaning set forth in Section 2.02 hereof. 3 12 "Event of Default" has the meaning set forth in Section 8.01(a) hereof. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States, as in effect on the Issue Date of the Securities of any series. "Global Security" means a Security that evidences all or part of the Securities of any series and is authenticated and delivered to, and registered in the name of, the Depository for such Securities or a nominee thereof. "Holder" means a Person in whose name a Security is registered. "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, including, for all purposes of this instrument, and any such supplemental indenture, the provisions of the TIA that are deemed to be a part of and govern this instrument and any such supplemental indenture, respectively. The term "Indenture" shall also include the terms of particular series of Securities established as contemplated by Section 3.01 hereof upon receipt by the Trustee of an Opinion of Counsel in accordance with Section 3.03 hereof. "Interest Payment Date", when used with respect to a Security of any series, means the Stated Maturity of an installment of interest on such Security. "Issue Date" means the date of original issuance of the Securities of each series established pursuant to Section 3.01 hereof. "Legal Holiday" means Saturday, Sunday or a day on which banking institutions in New York, New York or at a Place of Payment are authorized or obligated by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday at a Place of Payment, payment shall be made at that place on the next succeeding day that is not a Legal Holiday and no interest shall accrue for the intervening period. "Material Subsidiary" has the meaning set forth in the Indenture, dated as of June 21, 1993, between the Company and IBJ Schroder Bank & Trust Company, as trustee, relating to the Company's 9 3/4% Senior Notes due 2003 as in effect on the date hereof. 4 13 "Maturity", when used with respect to a Security of any series, means the date on which the principal of such Security or an installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise. "Non-Recourse Indebtedness" has the meaning set forth in the Indenture, dated as of June 21, 1993, between the Company and IBJ Schroder Bank & Trust Company, as trustee, relating to the Company's 9 3/4% Senior Notes due 2003 as in effect on the date hereof. "Officer" means the Chairman of the Board, the President, the Senior Vice President, the Treasurer, any Assistant Treasurer, the Controller, the Secretary, any Assistant Secretary or any Vice President of a Person. "Officers' Certificate" means a certificate signed by two Officers, one of whom must be the Person's Chief Executive Officer (or Co-Chief Executive Officer), Chief Operating Officer, Chief Financial Officer or Chief Accounting Officer. "Opinion of Counsel" means an opinion from legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or the Trustee. "Outstanding", when used with respect to Securities, 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 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; (iii) Securities as to which the Defeasance has been effected pursuant to Section 11.02 hereof; and (iv) Securities which have been paid pursuant to Section 3.06 or in exchange for or in lieu of which other Securities has 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 5 14 such Securities are held by a bona fide purchaser in whose hands such Securities are valid obligations of the Company; provided, however, that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, (a) the principal amount of a Security denominated in one or more foreign currencies or currency units shall be the U.S. dollar equivalent, determined in the manner provided as contemplated by Section 3.01 hereof on the Issue Date of such Security, of the principal amount of such Security, and (b) Securities owned by the Company or any other obligor of the Securities or any Subsidiary 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 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 Subsidiary of the Company or of such other obligor. "Paying Agent" means any Person, including the Company, authorized by the Company to pay the principal of or any interest on any Securities of any series. "Person" means any individual, corporation, partnership, joint venture, limited liability company, incorporated or unincorporated association, joint stock company, trust, unincorporated organization or government or other agency or political subdivision thereof or other entity of any kind. "Place of Payment", when used with respect to the Securities of any series, means the place or places where the principal of and interest on the Securities of that series are payable as specified as contemplated by Section 3.01 hereof. "Registrar" has the meaning set forth in Section 3.05 hereof. "Regular Record Date" for the interest payable on any Security on any Interest Payment Date means the date specified for that purpose as contemplated by Section 3.01 hereof. "SEC" means the Securities and Exchange Commission, and any successor thereto. 6 15 "Securities" has the meaning set forth in the first recital of this Indenture and more particularly means any securities of any series authenticated and delivered under this Indenture. "Security Register" has the meaning set forth in Section 3.05 hereof. "Senior Indebtedness" means the principal of (premium, if any) and interest on (including, without limitation, interest accruing subsequent to the filing of a petition under applicable Bankruptcy Law or the appointment of a Custodian), (i) any and all indebtedness and obligations of the Company (including indebtedness of others guaranteed by the Company), whether or not contingent and whether or not outstanding on the Issue Date of the Securities of any series or thereafter created, incurred or assumed, including, without limitation, all charges, fees, expenses (including, without limitation, reasonable attorneys' fees and expenses and other amounts incurred by or owing to holders of such indebtedness), which (a) is for money borrowed, (b) is evidenced by any bond, note, debenture or similar instrument, (c) represents the unpaid balance on the purchase price of any property, business or asset of any kind, (d) is an obligation of the Company as lessee under any and all leases of property, equipment or other assets required to be capitalized on the balance sheet of the lessee under GAAP, (e) is a reimbursement obligation of the Company with respect to letters of credit, (f) is an obligation of the Company with respect to an interest swap obligation or a foreign exchange agreement or (g) is an obligation of another secured by a lien to which any of the properties or assets (including, without limitation, leasehold interests and any other tangible or intangible property rights) of the Company are subject, whether or not the obligation secured thereby will have been assumed by the Company or will otherwise be the Company's legal liability and (ii) any deferrals, amendments, renewals, extensions, modifications and refundings of any indebtedness or obligations of the types referred to above; provided that Senior Indebtedness will not include (A) (x) the Securities of any series or (y) the Company's 4-7/8% Convertible Subordinated Debentures due 2005, (B) any indebtedness or obligation of the Company (or the instrument creating or evidencing it) which expressly provides that such indebtedness is not superior in right of payment to the Securities of any series or which expressly provides that such indebtedness is subordinate in right of payment to all other indebtedness of the Company (including the Securities of any series), (C) any indebtedness or obligation of the Company to any of its Subsidiaries and (D) any indebtedness or obligation incurred by the Company in connection with the purchase of assets, materials or services in the ordinary course of business and which constitutes a trade payable. "Special Record Date" for the payment of any Defaulted Interest on any Security means a date fixed by the Trustee pursuant to Section 3.07 hereof. "Stated Maturity", when used with respect to any Security of any series 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. 7 16 "Subsidiary" of any Person means (i) any corporation of which at least a majority of the aggregate voting power of all classes of the Common Equity is directly or indirectly beneficially owned by such Person, and (ii) any entity other than a corporation of which such Person directly or indirectly beneficially owns at least a majority of the Common Equity. "Successor" has the meaning set forth in Section 7.01(a) hereof. "TIA" means the Trust Indenture Act of 1939, as amended. "Trustee" means the Person named as the "Trustee" in the first paragraph of this Indenture 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. "Trust Officer" means any Senior Vice President, Vice President, Assistant Vice President, Assistant Secretary or Assistant Treasurer of the Trustee assigned by the Trustee to administer its corporate trust matters. "U.S. Government Obligations" means (i) any security that is (a) a direct obligation of the United States for the payment of which the full faith and credit of the United States is pledged or (b) an obligation of a Person controlled or supervised by and acting as an agency or instrumentality of the United States the payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States, which, in either case (a) or (b), is not callable or redeemable at the option of the issuer thereof, and (ii) any depositary 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 U.S. Government Obligation specified in clause (i) and held by such custodian for the account of the holder of such depositary receipt, or with respect to any specific payment of principal of or interest on any such U.S. Government Obligation; 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 depositary receipt from any amount received by the custodian in respect of the U.S. Government Obligation or the specific payment of principal or interest evidenced by such depositary receipt. SECTION 1.03 INCORPORATION BY REFERENCE OF TIA Whenever this Indenture refers to a provision of the TIA, such provision is incorporated by reference in and made a part of this Indenture. 8 17 ARTICLE 2 SECURITY FORMS SECTION 2.01 FORMS GENERALLY Each Security and Global Security issued pursuant to this Indenture shall be in substantially the form established by or pursuant to an Officers' Certificate or a Board Resolution or in one or more indentures supplemental hereto, shall have such appropriate insertions, omissions, substitutions and other variations as are required or permitted by or pursuant to this Indenture or any indenture supplemental hereto and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may, consistent herewith, be determined by the Officers executing such Security as evidenced by their execution of such Security. If temporary Securities of any series are issued as Global Securities as permitted by Section 3.04 hereof, the form thereof shall also be established as provided in the previous sentence. If the form of Securities of any series is established by action taken pursuant to an Officers' Certificate or a Board Resolution, a copy thereof shall be delivered to the Trustee at or prior to the delivery of the Company Order contemplated by Section 3.03 hereof for the authentication and delivery of such Securities. If all of the Securities of any series established by action taken pursuant to an Officers' Certificate or a Board Resolution are not to be issued at one time, it shall not be necessary to deliver a copy thereof at the time of issuance of each Security of such series, but such Officers' Certificate or Board Resolution shall be delivered at or prior to the time of issuance of the first Security of such series. Securities shall be printed, lithographed or engraved or produced by any combination of these methods or may be produced in any other manner, all as determined by the Officers of the Company executing such Securities, as evidenced by their execution of such Securities. SECTION 2.02 FORM OF LEGEND FOR GLOBAL SECURITIES Every Global Security authenticated and delivered hereunder shall 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 DEPOSITORY OR A NOMINEE OF A DEPOSITORY. THIS GLOBAL 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 SUCH LIMITED CIRCUMSTANCES. EVERY SECURITY DELIVERED UPON REGISTRATION OF 9 18 TRANSFER OF, OR IN EXCHANGE FOR, OR IN LIEU OF, THIS GLOBAL SECURITY SHALL BE A GLOBAL SECURITY SUBJECT TO THE FOREGOING, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED ABOVE. UNLESS THIS CERTIFICATE 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 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 TO BE 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. SECTION 2.03 FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION The Trustee's certificate of authentication shall be in substantially the following form: This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. [Name of Trustee] ----------------------------------- As Trustee By................................. Authorized Officer ARTICLE 3 THE SECURITIES SECTION 3.01 AMOUNT UNLIMITED; ISSUABLE IN SERIES The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited. 10 19 The Securities may be issued in one or more series and the Securities of each such series shall rank equally and pari passu with the Securities of each other series, but all Securities issued hereunder shall be subordinated and junior in right of payment, to the extent and in the manner set forth in Article 16 to all Senior Indebtedness of the Company. There shall be established in or pursuant to a Board Resolution and, set forth, or determined in the manner provided, in an Officers' Certificate, or established in one or more indentures supplemental hereto, which, in each case, shall be deemed incorporated herein by this reference and made a part hereof but only with respect to the series of Securities established pursuant to such Board Resolution, Officer's Certificate or supplemental indenture, prior to the issuance of Securities of any series the following: (1) the title of the Securities of the series (which shall distinguish the Securities of the series from Securities of any other series); (2) any limit upon the aggregate principal amount of the Securities of the series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Section 3.04, 3.05, 3.06, 4.07 or 13.05 hereof and except for any Securities which, pursuant to Section 3.03 hereof, are deemed never to have been authenticated and delivered hereunder); (3) the Person to whom any interest on a Security of the series shall be payable, if other than the Person in whose name that Security is registered at the close of business on the Regular Record Date for such interest; (4) the date or dates, or the method by which such date or dates will be determined, on which the principal of the Securities of the series is payable; (5) the rate or rates at which the Securities of the series shall bear interest, if any, or the method by which such rate or rates shall be determined, the date or dates from which such interest shall accrue, or the method by which such date or dates shall be determined, the Interest Payment Dates on which any such interest shall be payable and the Regular Record Date, if any, for the interest payable on any Security on any Interest Payment Date, or the method by which such date or dates shall be determined, and the basis upon which interest shall be calculated if other than on the basis of actual days elapsed over a 365 or 366-day year; (6) the place or places, if any, other than or in addition to New York, New York, where the principal of and interest on Securities of the series shall be payable, any Securities of the series may be surrendered for registration of transfer, Securities of the same series may be surrendered for exchange and, if different from the location specified in Section 14.02 hereof, the place or places 11 20 where notices or demands to or upon the Company in respect of the Securities of the series and this Indenture may be served; (7) the period or periods within, the price or prices at and the terms and conditions upon, which Securities of the series may be redeemed or purchased, in whole or in part, at the option of the Company; (8) the obligation, if any, of the Company to redeem or repurchase Securities of the series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of the series shall be redeemed or repurchased, in whole or in part, pursuant to such obligation; (9) if other than denominations of $1,000 and any integral multiple thereof, the denominations in which Securities of the series shall be issuable; (10) the currency, currencies or currency units in which payment of the principal of and interest on any Securities of the series shall be payable if other than the currency of the United States and the manner of determining the equivalent thereof in the currency of the United States for purposes of the definition of "Outstanding" in Section 1.01 hereof; (11) if the principal of or interest on any Securities of the series is to be payable, at the election of the Company or a Holder thereof, in one or more currencies or currency units other than that or those in which the Securities are stated to be payable, the currency, currencies or currency units in which payment of the principal of and interest on Securities of such series as to which such election is made shall be payable, and the periods within which and the terms and conditions upon which such election is to be made; (12) if the amount of payments of principal of or interest on any Securities of the series may be determined with reference to an index, the manner in which such amounts shall be determined; (13) if other than the principal amount of the Securities of any series, the portion of the principal amount of such Securities which shall be payable upon declaration of acceleration of the Maturity thereof; (14) if applicable, that the Securities of the series shall be defeasible as provided in Article 11 hereof; 12 21 (15) if and as applicable, that the Securities of the series shall be issuable in whole or in part in the form of one or more Global Securities and, in such case, the Depository or Depositories for such Global Security or Global Securities and any circumstances other than those set forth in Section 3.05 hereof in which any such Global Security may be transferred to, and registered and exchanged for Securities registered in the name of, a Person other than the Depository for such Global Security or a nominee thereof and in which any such transfer may be registered; (16) any deletions from, modifications of or additions to the Events of Default or covenants of the Company with respect to Securities of any series, whether or not such Events of Default or covenants are consistent with the Events of Default or covenants set forth herein; (17) if other than the Trustee, the identity of each Paying Agent and Registrar for the Securities of the series; and (18) any other terms of the series. All Securities of any one series shall be substantially identical except as to denomination and except as may otherwise be provided in or pursuant to the Board Resolution referred to above and set forth, or determined in the manner provided, in the Officers' Certificate referred to above 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 thereof shall be delivered to the Trustee at or prior to the delivery of the Officers' Certificate setting forth the terms of the series. SECTION 3.02 DENOMINATIONS In the absence of any specified denomination with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $1,000 and any integral multiple thereof. SECTION 3.03 EXECUTION, AUTHENTICATION, DELIVERY AND DATING The Securities shall be executed on behalf of the Company by two Officers, under its corporate seal reproduced thereon. The signature of any of the Officers on the Securities may be manual or by facsimile. Securities bearing the manual or facsimile signatures of individuals who were at any time the proper Officers of the Company shall bind the Company, notwithstanding that such 13 22 individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the date of such Securities. At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series, executed by the Company to the Trustee for authentication, together with a Company Order for the authentication and delivery of such Securities, and the Trustee in accordance with the Company Order shall authenticate and deliver such Securities. The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Securities. An authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such an agent. An authenticating agent has the same rights as an Agent to deal with the Company. The Company shall pay the reasonable fees and expenses of any authenticating agent. If the form or terms of the Securities of the series have been established in or pursuant to one or more Officers' Certificate or Board Resolutions as permitted by Sections 2.01 and 3.01 hereof, in authenticating such Securities, and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, and (subject to TIA Sections 315(a) through 315(d)) shall be fully protected in relying upon, an Opinion of Counsel stating: (1) if the form or forms of such Securities have been established by or pursuant to Board Resolution or an Officers' Certificate as permitted by Section 2.01 hereof, that such form or forms have been established in conformity with the provisions of this Indenture; (2) if the terms of such Securities have been established by or pursuant to a Board Resolution or an Officers' Certificate as permitted by Section 3.01 hereof, that such terms have been established in conformity with the provisions of this Indenture; and (3) that such Securities, 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 and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute the legal, valid and legally binding obligations of the Company, enforceable in accordance with their terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors' rights, to general equity principles and to such other qualifications as such counsel shall conclude do not materially affect the rights of Holders of such Securities. 14 23 Notwithstanding the provisions of Section 3.01 hereof and of the preceding paragraph, if all of the Securities of any series are not to be issued at one time, it shall not be necessary to deliver the Officers' Certificate or Board Resolution otherwise required pursuant to Section 3.01 hereof or the Company Order and Opinion of Counsel otherwise required pursuant to such preceding paragraph at the time of issuance of each Security of such series, but such documents shall be delivered at or prior to the time of issuance of the first Security of such series. Notwithstanding the immediately preceding sentence, any subsequent request by the Company to the Trustee to authenticate Securities of such series upon original issuance shall constitute a representation and warranty by the Company that, as of the date of such request, the statements made in the Opinion of Counsel delivered pursuant to this Section 3.03 shall be true and correct as if made on such date. The Trustee shall have the right to refuse to authenticate and deliver such Securities if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith by its board of directors or trustees, executive committee or a trust committee of directors or trustees and/or officers of the Trustee shall determine that such action would expose Trustee to personal liability to existing Holders or would adversely affect the Trustee's own rights, duties or immunities under this Indenture or otherwise. 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 duly executed by the Trustee by manual signature of an authorized signatory, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder and is entitled to the benefits of this Indenture. 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 3.09 hereof together with a Company Order (which need not comply with Section 14.08 hereof and need not be accompanied by an Opinion of Counsel) stating that such Security has never been issued or sold by the Company, for all purposes of this Indenture such Security shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled to the benefits of this Indenture. SECTION 3.04 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 authorized denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued, and with such appropriate insertions, omissions, substitutions and other 15 24 variations as the Officers executing such Securities may determine, as evidenced by their execution of such Securities. Every temporary Security shall be executed by the Company and authenticated by the Trustee and registered by the Registrar, upon the same conditions, and with like effect, as a definitive Security. If temporary Securities (other than a Global Security) of any series are issued, the Company will cause definitive Securities of that series to be prepared without unreasonable delay. After the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities of any series, the Company shall execute and the Trustee shall authenticate and deliver in exchange a like aggregate principal amount of definitive Securities of the same series of authorized denominations. Until so exchanged the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series. SECTION 3.05 REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE (a) The Company shall maintain a register of the Securities of each series (the "Security Register") in an office or agency of the Company in a Place of Payment (the "Registrar") where, subject to Section 3.05(c) hereof and such reasonable regulations as the Company may prescribe, Securities may be presented for registration of transfer or for exchange. The Company may appoint one or more co-Registrars. The term "Registrar" includes any co-Registrar. The Company may change any Registrar without notice to any Holder. The Company or any of its Subsidiaries may act as Registrar. Subject to Section 3.05(c), upon surrender for registration of transfer of any Security of any series at the office or agency of the Company in a Place of Payment for that series, 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 aggregate principal amount. Subject to Section 3.05(c), at the option of the Holder, Securities of any series may be exchanged for other Securities of the same series, of any authorized denominations and of a like aggregate principal amount, 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. 16 25 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 Registrar) be duly endorsed, or be accompanied by a written instrument of transfer, in form satisfactory to the Company and the Registrar, duly executed by the Holder thereof or its attorney duly authorized in writing. No service charge shall be made for any registration of 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 registration of transfer or exchange of Securities, other than exchanges pursuant to Section 3.04, 4.07 or 13.05 hereof not involving any transfer. The Company shall not be required (i) to issue, register the transfer of or exchange Securities of any series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of Securities of that series selected for redemption under Section 4.08 hereof and ending at the close of business on the day of such mailing, or (ii) to register the transfer or exchange of any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part, or (iii) to issue, register the transfer of or exchange any Security which has been surrendered for repayment at the option of the Holder, except the portion, if any, of such Security not to be so repaid. (b) In case the Company, pursuant to Article 7 hereof, will be consolidated or merged with or into any other Person or will convey, transfer or lease substantially all of its properties and assets to any Person, and the Successor resulting from such consolidation, or surviving such merger, or into which the Company will have been merged, or the Person which will have received a conveyance, transfer or lease as aforesaid, will have executed an indenture supplemental hereto with the Trustee pursuant to Article 7 hereof, any of the Securities authenticated or delivered prior to such consolidation, merger, conveyance, transfer or lease may, from time to time, at the request of the Successor, be exchanged for other Securities executed in the name of the Successor with such changes in phraseology and form as may be appropriate, but otherwise in substance and of like tenor as the Securities surrendered for such exchange and of like principal amount; and the Trustee, upon receipt of an Officers' Certificate from the Successor, will authenticate and deliver Securities as specified in such request for the purpose of such exchange. If Securities will at any time be authenticated and delivered in any new name of a Successor pursuant to this Section 3.05(b) hereof in exchange or substitution for or upon registration of transfer of any Securities, such Successor, at the option of the Holders but without 17 26 expense to them, will provide for the exchange of all Securities at the time outstanding for Securities authenticated and delivered in such new name. (c) The Company will execute and the Trustee will, in accordance with this Section 3.05(c) for so long as the Securities of any series are to be issued in whole or in part in the form of one or more Global Securities, authenticate and deliver one or more Global Securities that will (i) represent and will be denominated in an amount equal to the aggregate outstanding principal amount of the Securities to be represented by such Global Security or Securities, (ii) be registered in the name of the Depository for such Global Security or Securities or the nominee of such Depository, (iii) be delivered by the Trustee to such Depository or pursuant to such Depository's instructions and (iv) bear the legends set forth in Section 2.02 hereof. Each Depository appointed in accordance with Section 3.01 hereof for a Global Security must, at the time of its appointment and at all times while it serves as Depository, be a clearing agency registered under the Exchange Act, and any other applicable statute or regulation. Notwithstanding any other provision of this Section 3.05(c), unless and until it is exchanged in whole for Securities in definitive form of any series, a Global Security representing all or a portion of the Securities of any series may not be transferred except as a whole by the Depository to a nominee of such Depository or by a nominee of such Depository to such Depository or another nominee of such Depository or by such Depository or any such nominee to a successor Depository or a nominee of such successor Depository. If at any time the Depository is unwilling or unable to continue as Depository or if at any time the Depository will no longer be eligible to act as such under this Section 3.05(c), the Company will appoint a successor Depository. If (i) a successor Depository is not appointed by the Company within 90 days after the Company receives notice from the Depository or otherwise becomes aware of such unwillingness, inability or ineligibility or (ii) an Event of Default has occurred and is continuing, the Company will execute and deliver to the Trustee as promptly as practicable Securities in definitive form, together with an Officers' Certificate relating to the authentication and delivery of such Securities, and the Trustee, as promptly as practicable after the receipt of such Securities and Officers' Certificate, will authenticate and deliver Securities in definitive form in an aggregate principal amount equal to the principal amount of, and containing terms and provisions identical to, the Global Security or Securities in exchange for such Global Security or Securities. The Company may at any time and in its sole discretion determine that the Securities of any series issued in the form of one or more Global Securities will no longer be represented by such Global Security or Securities. In such event, the Company will execute and deliver to the Trustee Securities in definitive form, together with an Officers' Certificate relating to the authentication and delivery of Securities in definitive form, and the Trustee, as promptly as 18 27 practicable after the receipt of such Securities in definitive form and Officers' Certificate, will authenticate and deliver Securities in definitive form in an aggregate principal amount equal to the principal amount of, and containing terms and provisions identical to, the Global Security or Securities in exchange for such Global Security or Securities. Upon the exchange of a Global Security in whole or in part for Securities in definitive form, such Global Security shall be cancelled by the Trustee. Securities in definitive form issued in exchange for a Global Security pursuant to this Section 3.05(c) will be registered in such names and in such authorized denominations as the Depository, pursuant to instructions from its direct or indirect participants or otherwise, will instruct the Trustee in writing. The Trustee will deliver such Securities in definitive form to the Persons in whose names such Securities are so registered or as it may otherwise be directed by the Depository. Upon the exchange of less than the entire principal amount of a Global Security for Securities in definitive form, the Company will also execute, and the Trustee, upon receipt of an Officers' Certificate will also authenticate and deliver, a new Global Security in aggregate principal amount equal to the difference between the principal amount of the surrendered Global Security and the aggregate principal amount of Securities in definitive form issuable upon such exchange. In any exchange provided for in any of the preceding three paragraphs, the Company will execute and the Trustee will authenticate and deliver Securities in definitive form in authorized denominations. If a Security in definitive form is issued in exchange for any portion of a Global Security after the close of business at the office or agency where such exchange occurs on or after any Regular Record Date for an Interest Payment Date and before the opening of business at such office or agency on the next Interest Payment Date, interest will not be payable on such Interest Payment Date or proposed date for payment, as the case may be, in respect of such Security in definitive form, but will be payable on such Interest Payment Date only to the Person to whom interest in respect of such portion of such Global Security is payable in accordance with the provisions of this Indenture. None of the Company, the Trustee, any agent of the Trustee, any Paying Agent or the Registrar will have any responsibility or liability for any aspect of the Depository's records relating to or payments made on account of beneficial ownership interests in a Global Security or for maintaining, supervising or reviewing any of the Depository's records relating to such beneficial ownership interests. SECTION 3.06 MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES If any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new Security of the same series and of like principal amount and bearing a number not contemporaneously outstanding. 19 28 If there shall be delivered to the Company and 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 and 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 Company shall execute and upon receipt of a Company Order the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Security, a new Security of the same series and of like principal amount 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, instruct the Paying Agent to pay such Security. Upon the issuance of any new Security under this Section 3.06, 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 of any series issued pursuant to this Section 3.06 in lieu of any mutilated, destroyed, lost or stolen Security, shall constitute an original additional contractual obligation of the Company, whether or not the mutilated, 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 of that series duly issued hereunder. The provisions of this Section 3.06 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 3.07 PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED Except as otherwise provided as contemplated by Section 3.01 hereof with respect to any series of Securities, interest on any Security 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 is registered at the close of business on the Regular Record Date for such interest at the office or agency of the Company maintained for such purpose pursuant to Section 6.02 hereof. Any interest on any Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such defaulted interest and, if applicable, interest on such defaulted interest (to the extent lawful) at the rate specified in the Securities of such series (such defaulted interest and, if applicable, 20 29 interest thereon herein collectively called "Defaulted Interest") may be paid by the Company, at its election in each case, as provided in clause (i) or (ii) below: (i) The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Securities of such series 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 of such series and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money (except as otherwise specified pursuant to Section 3.01 hereof for the Securities of such series) 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 on or prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided. Thereupon, the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 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 Securities of such series at its address as it appears in the Security Register, not less than 10 days prior to such Special Record Date and notice shall be considered given whether or not received by the Holder. If notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor have been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Securities of such series are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following clause (ii). (ii) 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 the securities exchange on which such Securities may be listed, if any, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee. The provisions of this Section 3.07 may be applicable to any series of Securities pursuant to Section 3.01 hereof (with such modifications, additions or substitutions as may be specified pursuant to such Section 3.01 hereof). Subject to the foregoing provisions of this Section 3.07 and Section 3.05 hereof, each Security delivered under this Indenture upon registration of transfer of or in exchange for or 21 30 in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security. SECTION 3.08 PERSONS DEEMED OWNERS Subject to Section 3.05(c), prior to due presentment of a Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Security is registered as the owner of such Security for the purpose of receiving payment of principal of and (except as contemplated by Section 3.05 hereof and subject to Section 3.07 hereof) interest on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee nor any agent of the Company or Trustee shall be affected by notice to the contrary. SECTION 3.09 CANCELLATION All Securities surrendered for payment, redemption, repayment at the option of the Holder, if applicable, registration of transfer or exchange or for credit against any current or future sinking fund payment shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be promptly cancelled by it. The Company may at any time deliver to the Trustee for cancellation any Securities previously authenticated and delivered hereunder 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 accompanied by an Officers' Certificate authorizing such cancellation, and shall be promptly cancelled by the Trustee. If the Company shall so acquire any of the Securities, however, such acquisition shall not operate as a redemption or satisfaction of the indebtedness represented by such Securities unless and until the same are surrendered to the Trustee for cancellation. No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled Securities held by the Trustee shall be disposed of as directed by a Company Order. SECTION 3.10 COMPUTATION OF INTEREST Except as otherwise specified as contemplated by Section 3.01 hereof for Securities of any series, interest on the Securities of each series shall be computed on the basis of a 365 or 366-day year. 22 31 ARTICLE 4 REDEMPTION SECTION 4.01 APPLICABILITY OF ARTICLE If so provided as contemplated by Section 3.01 hereof for Securities of any series, Securities of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and in accordance with this Article 4. SECTION 4.02 ELECTION TO REDEEM; NOTICE TO TRUSTEE In the event the Company elects to redeem Securities of any series pursuant to the optional redemption provisions of Section 4.08 hereof, it will notify the Trustee in writing, at least 30 days but not more than 60 days before a redemption date, of the redemption date and the principal amount of Securities of a series to be redeemed. SECTION 4.03 SELECTION OF SECURITIES TO BE REDEEMED (a) In the event less than all of the Outstanding Securities of a series are to be redeemed, the Trustee will select the Securities of such series to be redeemed pro rata or by lot or by any other method the Trustee deems fair and appropriate but only in integral multiples of $1,000. The particular Securities of a series to be redeemed will be selected, unless otherwise provided herein, not less than 20 nor more than 60 days prior to the redemption date by the Trustee from the Outstanding Securities of such series not previously called for redemption. (b) The Trustee will promptly notify the Company in writing of the Securities of such series selected for redemption and, in the case of any Security of a series selected for partial redemption, the principal amount thereof to be redeemed but not in integral multiples of less than $1,000. Provisions of this Indenture that apply to Securities of a series called for redemption also apply to portions of Securities of a series called for redemption. SECTION 4.04 NOTICES TO HOLDERS (a) At least 15 days but not more than 60 days before a redemption date, the Company will mail a notice to each Holder whose Securities are to be redeemed. (b) The notice will identify the Securities of the series to be redeemed and will state: (i) the redemption date; 23 32 (ii) the redemption price; (iii) if any Outstanding Security of any series is being redeemed in part, the portion of the principal amount of such Security to be redeemed and that, after the redemption date, upon surrender of such Security, a new Security or Securities in principal amount equal to the unredeemed portion will be issued; (iv) the name and address of the Paying Agent; (v) that Securities called for redemption must be surrendered to the Paying Agent at the address specified in such notice to collect the redemption price; (vi) that interest on Securities called for redemption ceases to accrue on and after the redemption date; (vii) that the redemption is for a sinking fund, if such is the case; (viii) the aggregate principal amount of Securities that are being redeemed; and (ix) that funds for the redemption price shall be deposited in accordance with Section 4.06 hereof, failing which the notice shall be deemed cancelled. (c) At the Company's written request, the Trustee will give the notice required in this Section 4.04 in the Company's name and at its expense. SECTION 4.05 EFFECT OF NOTICE OF REDEMPTION Once notice of redemption is mailed, Outstanding Securities of such series called for redemption become due and payable on the redemption date at the redemption price and, subject to Section 4.06(b) hereof, interest on such Securities ceases to accrue on and after the redemption date. SECTION 4.06 DEPOSIT OF REDEMPTION PRICE (a) At least one Business Day prior to the redemption date, the Company will deposit with the Trustee or with the Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 6.04 hereof) money sufficient to pay the redemption price of, and accrued and previously unpaid interest on, all Securities of such series to be redeemed on that date, and the Trustee will remit the redemption price to Holders entitled thereto. The Trustee or the Paying Agent will return to the Company any money not required for that purpose. 24 33 (b) If the Company complies with Section 4.06(a) hereof, interest on the Securities of such series or portions thereof to be redeemed (whether or not such Securities are presented for payment) will cease to accrue on the applicable redemption date. If any Security of such series called for redemption is not so paid upon surrender because of the failure of the Company to comply with Section 4.06(a) hereof, then interest will be paid on the unpaid principal from the last Interest Payment Date until such principal is paid in full at the rate determined pursuant to Section 3.01 hereof for the Securities of such series. SECTION 4.07 SECURITIES REDEEMED IN PART Upon surrender of a Security of such series that is redeemed in part, the Company will issue and the Trustee will authenticate for the Holder at the expense of the Company a new Security of the same series, maturity date, interest rate and Issue Date equal in principal amount to the unredeemed portion of the Security of such series surrendered. SECTION 4.08 OPTIONAL REDEMPTION The Company may redeem all or any portion of the Outstanding Securities of any series at any time and from time to time that are redeemable before their maturity except as otherwise specified as contemplated by Section 3.01 hereof for Securities of such series at the redemption prices together in each case, with accrued interest, if any, to the date fixed for redemption, determined pursuant to Section 3.01 hereof. ARTICLE 5 SINKING FUNDS SECTION 5.01 APPLICABILITY OF ARTICLE If so provided as contemplated by Section 3.01 hereof for Securities of any series, retirements of Securities of any series pursuant to any sinking fund shall be made in accordance with their terms and in accordance with this Article 5. The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a "mandatory sinking fund payment", and any payment in excess of such minimum amount provided for by the terms of Securities of any series is herein referred to as an "optional sinking fund payment." If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 5.02 hereof. Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series. 25 34 SECTION 5.02 SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES Subject to Section 5.03 hereof, in lieu of making all or any part of any mandatory sinking fund payment with respect to any Securities of a series in cash, the Company may at its option (i) deliver to the Trustee Outstanding Securities of a series (other than any previously called for redemption) theretofore purchased or acquired by the Company and/or (ii) receive credit for the principal amount of Securities of a series which have been previously delivered to the Trustee by the Company or for Securities of such series which have been redeemed either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any mandatory sinking fund payment with respect to the Securities of the same series required to be made pursuant to the terms of such Securities as provided for by the terms of such series; provided that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the redemption price specified in such Securities for redemption through operation of the sinking fund and the amount of such mandatory sinking fund payment shall be reduced accordingly. SECTION 5.03 REDEMPTION OF SECURITIES FOR SINKING FUND Not less than 60 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee an Officers' Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivering or crediting Securities of that series pursuant to Section 5.02 hereof (which Securities will, if not previously delivered, accompany such Officers' Certificate) and whether the Company intends to exercise its right to make a permitted optional sinking fund payment with respect to such series. Such Officers' Certificate shall be irrevocable and upon its delivery the Company shall be obligated to make the cash payment or payments therein referred to, if any, on or before the next succeeding sinking fund payment date. In the case of the failure of the Company to deliver such Officers' Certificate, the sinking fund payment due on the next succeeding sinking fund payment date for that series shall be paid entirely in cash and shall be sufficient to redeem the principal amount of such Securities subject to a mandatory sinking fund payment without the option to deliver or credit Securities as provided in Section 5.02 hereof and without the right to make any optional sinking fund payment, if any, with respect to such series. Not more than 60 days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 4.03 hereof and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 4.04 hereof. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Article 4 hereof. 26 35 Prior to any sinking fund payment date, the Company shall pay to the Trustee or a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 6.04 hereof) in cash a sum equal to any interest that will accrue to the date fixed for redemption of Securities or portion thereof to be redeemed on such sinking fund payment date pursuant to this Section 5.03. Notwithstanding the foregoing, with respect to a sinking fund for any series of Securities, if at any time the amount of cash to be paid into such sinking fund on the next succeeding sinking fund payment date, together with any unused balance of any preceding sinking fund payment or payments for such series, does not exceed in the aggregate $100,000, the Company shall not instruct the Trustee to give the next succeeding notice of the redemption of Securities of such series through the operation of the sinking fund. Any such unused balance of moneys deposited in such sinking fund shall be added to the sinking fund payment for such series to be made in cash on the next succeeding sinking fund payment date or, at the request of the Company, shall be applied at any time or from time to time to the purchase of Securities of such series, by public or private purchase as negotiated by the Company, in the open market or otherwise, at a purchase price for such Securities (excluding accrued interest and brokerage commissions, for which the Trustee or any Paying Agent will be reimbursed by the Company) not in excess of the principal amount thereof. ARTICLE 6 COVENANTS SECTION 6.01 PAYMENT OF SECURITIES (a) The Company will pay the principal of, and interest on, the Securities of each series on the dates and in the manner provided herein and in the Securities. In the event the Company is not the Paying Agent, principal and interest will be considered paid on the date due if the Trustee or Paying Agent holds on that date money deposited by the Company designated for and sufficient to pay all principal and interest then due. In the event the Company is the Paying Agent, principal and interest will be considered paid on the date actual payment is mailed, or otherwise sent or given, to the Holders entitled to such payments. (b) The Company will pay interest on overdue principal at the applicable interest rate on the Securities of each series as determined in accordance with Section 3.01 hereof. 27 36 SECTION 6.02 MAINTENANCE OF OFFICE OR AGENCY (a) The Company will maintain in each Place of Payment for any series of Securities, in New York, New York, an office or agency (which may be an office of the Trustee or the Registrar) where Securities of such series may be presented or surrendered for payment, where Securities of that series may be presented for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of such series and this Indenture may be served. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company fails to maintain any such required office or agency or fails 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. (b) The Company may also from time to time designate one or more other offices or agencies where the Securities of each series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission will in any manner relieve the Company of its obligation to maintain an office or agency in New York, New York 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. (c) The Company hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Company in accordance with this Section 6.02. SECTION 6.03 SEC REPORTS; FINANCIAL STATEMENTS (a) As long as more than 10 percent of the original principal amount of the Securities of any series is Outstanding, the Company will (i) remain subject to the requirements of Section 13 or 15(d) of the Exchange Act whether or not it is required to do so by the provisions thereof and will file with the SEC all periodic reports as may be required thereunder and (ii) file with the SEC and the Trustee within 15 days after the Company is required to file the same with the SEC, copies of the periodic reports which the Company may be required to file with the SEC pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act. The Company will also make such reports available to the Holders, prospective purchasers of the Securities of any such series, securities analysts and broker-dealers upon their written request. (b) In the event that (i) 10 percent or less of the original principal amount of the Securities of any series is Outstanding and (ii) the Company is not required to file with the SEC such reports and other information referred to in Section 6.03(a) hereof, the Company will furnish to the Trustee (A) within 120 days after the end of each fiscal year, annual reports containing the information required to be contained in Items 1, 2, 3, 5, 6, 7, 8 and 9 of the Annual Report on Form 10-K promulgated under the Exchange Act, or substantially the same 28 37 information required to be contained in comparable items of any successor form, (B) within 60 days after the end of each of the first three fiscal quarters of each fiscal year, quarterly reports containing the information required to be contained in the Quarterly Report on Form 10-Q promulgated under the Exchange Act, or substantially the same information required to be contained in any successor form and (C) promptly from the time after the occurrence of an event which would be required to be reported in the Current Report on Form 8-K if the Company was required to file such Report, such other reports containing information required to be contained in the Current Report on Form 8-K promulgated under the Exchange Act, or substantially the same information required to be contained in any successor form. (c) The Company will also comply with the other provisions of TIA Section 314(a). SECTION 6.04 MONEY FOR SECURITY PAYMENTS TO BE HELD IN TRUST (a) In the event the Company will at any time act as its own Paying Agent with respect to any series of Securities, it will, not less than one Business Day before each due date of the principal of or interest on any of the Securities of any series, segregate and hold in trust for the benefit of the Holders entitled thereto a sum sufficient to pay the principal or interest so becoming due until such sums will be paid to such Persons or otherwise disposed of as herein provided, and will promptly notify the Trustee of its action or failure to so act. (b) In the event the Company is not acting as Paying Agent with respect to any series of Securities, the Company will, not less than one Business Day before each due date of the principal of or interest on, any Securities of any series, deposit with a Paying Agent a sum in same day funds sufficient to pay the principal or interest so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of such action or any failure to so act. (c) In the event the Company is not acting as Paying Agent with respect to any series of Securities, 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 will agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will: (i) hold all sums held by it for the payment of the principal of or interest on Securities of such series in trust for the benefit of the Holders of such series of Securities and the Trustee entitled thereto until such sums will be paid to such Persons or otherwise disposed of as herein provided; (ii) give the Trustee notice of any Default by the Company in the making of any payment of principal or interest; 29 38 (iii) 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 (iv) acknowledge, accept and agree to comply in all aspects with the provisions of this Indenture relating to the duties, rights and disabilities of such Paying Agent. (d) 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 sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such sums. (e) Except as provided in the Securities of any series, 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 or interest on any Security of any series and remaining unclaimed for two years after such principal or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall 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 New York, 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 notification or publication, any unclaimed balance of such money then remaining will be repaid to the Company. SECTION 6.05 COMPLIANCE CERTIFICATE (a) The Company will deliver to the Trustee within 120 days after the end of each fiscal year of the Company an Officers' Certificate stating whether or not the signers know of any Default or Event of Default that occurred during such period. If they do know of a Default or an Event of Default, the Officers' Certificate will describe the Default or Event of Default and the action the Company is taking or proposes to take with respect thereto. (b) The Company will give prompt written notice to the Trustee of the occurrence of any Default or Event of Default. 30 39 SECTION 6.06 CORPORATE EXISTENCE, ETC. Subject to the provisions of Article 7 hereof, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and the rights (charter and statutory), licenses and franchises of the Company, except in such cases where a failure to do so would not in the judgment of management have a material adverse effect on the business, prospects, assets or financial condition of the Company and its Subsidiaries taken as a whole and would not have a materially adverse impact on the Holders of Securities of any series. SECTION 6.07 PAYMENT OF TAXES AND OTHER CLAIMS The Company will pay or discharge or cause to be paid or discharged, before the same will become delinquent, (i) all taxes, assessments and governmental charges levied or imposed upon the Company or upon the income, profits or property of the Company other than any such tax, assessment, charge or claim whose amount, applicability or validity is being contested in good faith by appropriate proceedings and for which appropriate provision has been made in accordance with GAAP and (ii) all lawful claims for labor, materials and supplies which, if unpaid, might by law become a lien upon the property of the Company, in each case except to the extent the failure to do so would not have, in the judgment of management, a material adverse effect on the Company and its Subsidiaries taken as a whole. SECTION 6.08 INSURANCE The Company will maintain and will cause each of its Subsidiaries to maintain (either in the name of the Company or in such Subsidiary's own name) with third party insurance companies or pursuant to self-insurance, (i) insurance on all their respective properties, (ii) public liability insurance against claims for personal injury or death as a result of the use of any products sold by it and (iii) insurance coverage against other business risks, in each case, in at least such amounts and against at least such other risks (and with such risk retention) as are usually and prudently insured against in the same general area by companies engaged in the same or a similar business. SECTION 6.09 STAY, EXTENSION AND USURY LAWS The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the Company's obligation to pay the Securities of each series, and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law insofar as such law applies to the Securities of each series, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any 31 40 power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law has been enacted. SECTION 6.10 MAINTENANCE OF PROPERTIES The Company will take reasonable action to maintain in appropriate condition each of its principal properties which in the judgment of management is essential to the business operations of the Company and its Subsidiaries taken as a whole and the loss of which would have a material adverse affect on the financial condition of the Company and its Subsidiaries taken as a whole. Nothing contained in this Section 6.10 will prevent or restrict the sale, abandonment or other disposition of any property which management deems advisable. ARTICLE 7 SUCCESSORS SECTION 7.01 LIMITATIONS ON MERGERS AND CONSOLIDATIONS (a) The Company will not consolidate or merge with or into, or sell, lease, convey or otherwise dispose of all or substantially all of its assets (including, without limitation, by way of liquidation or dissolution), or assign any of its obligations hereunder or under the Securities of any series (as an entirety or substantially an entirety in one transaction or series of related transactions), to any Person unless: (i) the Person formed by or surviving such consolidation or merger (if other than the Company), or to which sale, lease, conveyance or other disposition or assignment will be made (collectively, the "Successor"), is a solvent corporation or other legal entity organized and existing under the laws of the United States or any state thereof or the District of Columbia, and the Successor assumes by supplemental indenture in a form reasonably satisfactory to the Trustee all of the obligations of the Company under the Securities of any series and this Indenture, (ii) immediately after giving effect to such transaction, no Default or Event of Default has occurred and is continuing, and (iii) the Company will have delivered to the Trustee prior to the consummation of the proposed transaction an Officers' Certificate to the foregoing effect and an Opinion of Counsel stating that the proposed transaction and such supplemental indenture comply with this Indenture. SECTION 7.02 SUCCESSOR CORPORATION SUBSTITUTED Upon any consolidation or merger, or any sale, lease, conveyance or other disposition of all or substantially all of the assets of the Company or any assignment of its obligations under this Indenture or the Securities of any series in accordance with Section 7.01 hereof, upon assumption by the successor corporation, by supplemental indenture, executed and delivered to the Trustee and satisfactory in form to the Trustee, of the due and punctual payment 32 41 of the principal of and interest on all of the Securities of any series and the due and punctual performance and observance of all the covenants and conditions of this Indenture to be performed or observed by the Company, the Successor formed by such consolidation or into or with which the Company is merged or to which such sale, lease, conveyance or other disposition or assignment is made will 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 has been named as the Company herein and such Successor may cause to be signed and may issue in its own name or in the name of the Company, any or all Securities of any series issuable hereunder and the predecessor Company, in the case of a sale, lease, conveyance or other disposition or assignment, will be released from all obligations under this Indenture and the Securities of any series. ARTICLE 8 DEFAULTS AND REMEDIES SECTION 8.01 EVENTS OF DEFAULT (a) "Event of Default", wherever used herein with respect to Securities of any series, means any of the following events (whatever the reason for such Event of Default and whether it will 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): (i) the failure by the Company to pay interest on any Security of that series when the same becomes due and payable and the continuance of any such failure for a period of 30 days; (ii) the failure by the Company to pay the principal of any Security of that series when the same becomes due and payable at Maturity, upon acceleration or otherwise; (iii) the failure by the Company to make any sinking fund payment when the same becomes due and payable by the terms of a Security of that series and Article 5 hereof; (iv) the failure by the Company to comply with any of its agreements or covenants in, or provisions of, the Security of that series or this Indenture (other than an agreement or covenant a default in whose performance or whose breach is elsewhere in this Section specifically dealt with or which has expressly been included in this 33 42 Indenture solely for the benefit of a series of Securities other than that series) and such failure continues for the period and after the notice specified below; (v) the acceleration of any indebtedness (other than Non-Recourse Indebtedness) for borrowed money or guarantees thereof of the Company or any of its Subsidiaries that has an outstanding principal amount of $10,000,000 or more in the aggregate; provided that, in the event any such acceleration is withdrawn or otherwise rescinded within a period of five days after such acceleration by the holders of such indebtedness, any Event of Default under this Section 8.01(a)(v) will be deemed to be cured and any acceleration hereunder will be deemed withdrawn or rescinded; (vi) the failure by the Company or any of its Subsidiaries to make any principal or interest payment in respect of indebtedness (other than Non-Recourse Indebtedness) for borrowed money or guarantees thereof of the Company or any of its Subsidiaries with an outstanding aggregate amount of $10,000,000 or more within five days of such principal or interest payment becoming due and payable (after giving effect to any applicable grace period set forth in the documents governing such indebtedness); (vii) a final judgment or judgments that exceed $10,000,000 or more in the aggregate, for the payment of money, having been entered by a court or courts of competent jurisdiction against the Company or any of its Subsidiaries and such judgment or judgments is not satisfied, stayed, annulled or rescinded within 60 days of being entered; (viii) the Company or any Material Subsidiary pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case, (B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointment of a Custodian of it or for all or substantially all of its property, or (D) makes a general assignment for the benefit of its creditors; (ix) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief against the Company or any Material Subsidiary as debtor in an involuntary case, 34 43 (B) appoints a Custodian of the Company or any Material Subsidiary or a Custodian for all or substantially all of the property of the Company or any Material Subsidiary, or (C) orders the liquidation of the Company or any Material Subsidiary, and the order or decree remains unstayed and in effect for 60 days; or (x) any other Event of Default provided with respect to Securities of that series. (b) The Trustee will not be deemed to know of a Default unless a Trust Officer has actual knowledge of such Default or receives written notice of such Default with specific reference to such Default. (c) A Default under Section 8.01(a)(iv) hereof is not an Event of Default until the Trustee notifies the Company, or the Holders of at least 25 percent in aggregate principal amount of the Outstanding Securities of all series affected thereby notify the Company and the Trustee, of the Default and the Company does not cure the Default within 60 days after receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a "Notice of Default." If such a Default is cured within such time period, it ceases. SECTION 8.02 ACCELERATION (a) If an Event of Default with respect to Securities of any series at the time Outstanding (other than an Event of Default with respect to the Company specified in clause (viii) or (ix) of Section 8.01(a) hereof) occurs and is continuing, the Trustee (after receiving indemnities from the Holders to its satisfaction) by notice to the Company, or the Holders of at least 25 percent in aggregate principal amount of the Outstanding Securities of such series by notice to the Company and the Trustee, may declare all Outstanding Securities of such series to be due and payable immediately. Upon such declaration, the amounts due and payable on the Securities of such series, as determined in Section 8.02(b) hereof, will be due and payable immediately. If an Event of Default specified in clause (viii) or (ix) of Section 8.01(a) hereof occurs, such an amount will ipso facto become and be immediately due and payable without any declaration, notice or other act on the part of the Trustee and the Company or any Holder. The Holders of a majority in aggregate principal amount of the Outstanding Securities of any series by written notice to the Trustee and the Company may waive such Event of Default, rescind an acceleration and its consequences (except an acceleration due to nonpayment of principal or interest on the Securities of such series) if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived. 35 44 (b) In the event that the maturity of the Securities of any series is accelerated pursuant to Section 8.02(a) hereof, 100 percent of the principal amount of the Securities of such series will become due and payable plus accrued interest, if any, to the date of payment. SECTION 8.03 OTHER REMEDIES (a) If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal or interest on the Securities of any series or to enforce the performance of any provision of the Securities of any series or this Indenture. (b) The Trustee may maintain a proceeding even if it does not possess any of the Securities of any series or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default will not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law. SECTION 8.04 WAIVER OF PAST DEFAULTS AND COMPLIANCE WITH INDENTURE PROVISIONS Subject to Sections 8.07 and 13.02 hereof, the Holders of a majority in aggregate principal amount of the Outstanding Securities of any series by notice to the Trustee may waive an existing Default or Event of Default and its consequences (including waivers obtained in connection with a tender offer or exchange offer for Securities), except a continuing Default or Event of Default in the payment of the principal of or interest on any Security of such series. Upon any such waiver, such Default will cease to exist, and any Event of Default arising therefrom will be deemed to have been cured for every purpose of this Indenture, but no such waiver will extend to any subsequent or other Default or Event of Default or impair any right consequent thereon. SECTION 8.05 CONTROL BY MAJORITY The Holders of a majority in aggregate principal amount of the Outstanding Securities of any series may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee (after providing indemnities to the Trustee's satisfaction) or exercising any trust or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture that the Trustee determines may be unduly prejudicial to the rights of other Holders of Securities of such series, or that may subject the Trustee to legal liability; provided that the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction. 36 45 SECTION 8.06 LIMITATIONS ON SUITS (a) A Holder may pursue a remedy with respect to this Indenture or the Securities of any series only if: (i) the Holder gives to the Trustee written notice of a continuing Event of Default with respect to the Securities of that series; (ii) the Holder(s) of at least 25 percent in aggregate principal amount of all of the Outstanding Securities of that series make a written request to the Trustee to pursue the remedy; (iii) such Holder or Holders offer to the Trustee indemnity reasonably satisfactory to the Trustee against any loss, liability or expense; (iv) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and (v) during such 60-day period the Holders of a majority in aggregate principal amount of the Outstanding Securities of such series do not give the Trustee a direction inconsistent with the request. (b) A Holder of a Security of any series may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder. SECTION 8.07 RIGHTS OF HOLDERS TO RECEIVE PAYMENT Notwithstanding any other provision of this Indenture, the right of any Holder of a Security of any series to receive payment of principal and interest on the Security of such series, on or after the respective due dates expressed in the Security of such series, or, subject to Section 8.06 hereof, to bring suit for the enforcement of any such payment on or after such respective dates, will not be impaired or affected without the consent of the Holder. SECTION 8.08 COLLECTION SUIT BY TRUSTEE If an Event of Default specified in Section 8.01(a)(i) or 8.01(a)(ii) hereof occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the amount of principal and interest remaining unpaid on the Securities of such series, determined in accordance with Section 8.02(b) hereof, and such further amount as will be sufficient to cover the costs and expenses of collection, including, without limitation, the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. 37 46 SECTION 8.09 TRUSTEE MAY FILE PROOFS OF CLAIM The Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including, without limitation, any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, it agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company, its creditors or property and will be entitled and empowered to collect, receive and distribute any money or other property payable or deliverable on any such claims and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee consents to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 9.07 hereof. Nothing contained herein will 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 8.10 PRIORITIES (a) Subject to Article 16 hereof, in the event the Trustee collects any money pursuant to this Article 8, it will pay out the money in the following order: FIRST: to the Trustee for amounts due under Section 9.07 hereof; SECOND: to Holders for amounts due and unpaid on the Securities for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Securities for principal and interest, respectively; and THIRD: to the Company or such other Person legally entitled thereto. (b) The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 8.10. SECTION 8.11 UNDERTAKING FOR COSTS In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant (other than the Trustee) in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This 38 47 Section 8.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 8.07 hereof, or a suit by Holders of more than ten percent in aggregate principal amount of all of the Outstanding Securities of any series. SECTION 8.12 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 Trustee and the Holders will, 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 will continue as though no such proceeding had been instituted. ARTICLE 9 TRUSTEE SECTION 9.01 DUTIES OF TRUSTEE (a) If an Event of Default has occurred and is continuing, the Trustee will exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in such exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. (b) Except during the continuance of an Event of Default: (i) the Trustee need perform only those duties that are specifically set forth in this Indenture and no others, and no implied covenants or obligations will 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. However, in the case of any such certificates or opinions which are specifically required to be furnished to the Trustee by any of the provisions hereof, the Trustee will examine the certificates and opinions to determine whether or not, on their face, they appear to conform to the requirements of this Indenture. 39 48 (c) The Trustee may not be relieved from liabilities for its own gross negligent action, its own gross negligent failure to act, or its own willful misconduct, except that: (i) this Section 9.01(c) does not limit the effect of Section 9.01(b) hereof; (ii) the Trustee will not be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee was grossly negligent in ascertaining the pertinent facts; and (iii) the Trustee will not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 9.05 hereof or when exercising any other trust or power conferred upon the Trustee under this Indenture. Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to clauses (i), (ii) and (iii) of this Section 9.01(c). (d) No provision of this Indenture will 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 has reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (e) The Trustee will not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. Subject to Sections 9.03 and 9.07 hereof, all money received by the Trustee will, until applied as herein provided, be held in trust for the payment of principal and interest on the Securities. (f) The Trustee shall not be required to give any bond or surety in respect of the exercise of its powers and performance of its duties hereunder. SECTION 9.02 RIGHTS OF TRUSTEE (a) Subject to Section 9.01 hereof: (i) the Trustee may rely and will be protected in acting or refraining from acting upon any document believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in the 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 determines to 40 49 make such further inquiry or investigation, it will be entitled to examine the books, records, and premises of the Company, personally or by agent or attorney; (ii) before the Trustee acts or refrains from acting, it may require an Officers' Certificate. The Trustee will not be liable for any action it takes or omits to take in good faith in reliance on such Officers' Certificate. The Trustee may consult with counsel satisfactory to it and the written advice of such counsel or any Opinion of Counsel will 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; (iii) the Trustee may act through agents and will not be responsible for the misconduct or negligence of any agent appointed with due care; provided, however, that the Trustee will in any event be liable for the misappropriation of funds deposited with it or in an account within its dominion and control; (iv) the Trustee will not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers conferred upon it by this Indenture; and (v) unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company will be sufficient if signed by an Officer of the Company. (b) The Trustee will be under no obligation to exercise and may refuse 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 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. SECTION 9.03 INDIVIDUAL RIGHTS OF TRUSTEE The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or any of its Affiliates with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. However, the Trustee is subject to Sections 9.10 and 9.11 hereof. SECTION 9.04 TRUSTEE'S DISCLAIMER The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities of any series, it will not be accountable for any actions taken by the Company or any action taken by the Trustee hereunder at the direction of the Company or in reliance upon an Opinion of Counsel, and it will not be responsible for any statement or recital 41 50 herein or any statement in the Securities of any series other than its certificate of authentication. The immunities and exemptions from liability of the Trustee hereunder shall extend to its directors, officers, employees and agents. SECTION 9.05 NOTICE OF DEFAULTS If a Default or Event of Default with respect to any series of Securities occurs and is continuing and if it is known to the Trustee, the Trustee will mail to Holders of such Securities a notice of the Default or Event of Default within 90 days after it occurs. However, except in the case of a Default or Event of Default in payment of principal or interest on any Security of such series, the Trustee may withhold such notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of such Holders. SECTION 9.06 REPORTS BY TRUSTEE TO HOLDERS (a) Within 60 days after each ______, beginning with ____________, the Trustee will mail to Holders a brief report dated as of such reporting date that complies with TIA Section 313(a); provided, however, if no event described in TIA Section 313(a) has occurred within such calendar year, no report need be transmitted. The Trustee also will comply with TIA Sections 313(b) and 313(c). (b) A copy of each report at the time of its mailing to Holders will be filed with the SEC and each stock exchange, if any, on which the Securities of any series are listed. The Company will notify the Trustee when the Securities of any series are listed on any stock exchange. SECTION 9.07 COMPENSATION AND INDEMNITY (a) The Company agrees: (i) to pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder (which compensation will not be limited by any provision of law in regard to the compensation of a trustee of an express trust); (ii) 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, without limitation, the reasonable compensation and the expenses, advances and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its gross negligence or bad faith; and 42 51 (iii) to indemnify the Trustee and its agents for, and to hold them harmless against, any loss, liability or expense incurred without gross negligence or bad faith on their part, arising out of or in connection with the acceptance or administration of this trust, including the costs and expenses of defending themselves against any claim or liability in connection with the exercise or performance of any of their powers or duties hereunder. (b) To secure the Company's payment obligations in this Section 9.07, the Trustee will have a lien prior to the Securities on all money or property held or collected by the Trustee, except that held in trust to pay principal and interest on particular Securities. (c) When the Trustee incurs expenses or renders services after an Event of Default specified in Section 8.01(a)(viii) or (a)(ix) occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law. SECTION 9.08 REPLACEMENT OF TRUSTEE (a) A resignation or removal of the Trustee and appointment of a successor Trustee will become effective only upon the successor Trustee's acceptance of appointment as provided in this Section 9.08. (b) The Trustee may resign and be discharged from the trust hereby created by so notifying the Company in writing. The Holders of a majority in principal amount of the Outstanding Securities of any series may remove the Trustee by so notifying the Trustee and the Company. The Company may remove the Trustee if: (i) the Trustee fails to comply with Section 9.10 hereof; (ii) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law; (iii) a Custodian or public officer takes charge of the Trustee or its property; or (iv) the Trustee becomes incapable of acting. (c) If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company will promptly appoint a successor Trustee. (d) If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of at least ten 43 52 percent in principal amount of the Outstanding Securities of any series may petition any court of competent jurisdiction for the appointment of a successor Trustee. (e) If the Trustee with respect to any series of Securities fails to comply with Section 9.10 hereof, any Holder may petition any court of competent jurisdiction for the removal of the Trustee with respect to such series and the appointment of a successor Trustee. (f) A successor Trustee will deliver a written acceptance of its appointment to the retiring Trustee with respect to such series and to the Company. Thereupon the resignation or removal of the retiring Trustee will become effective, and the successor Trustee will have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee will mail a notice of its succession to the Holders. The retiring Trustee will promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 9.07 hereof. Notwithstanding replacement of the Trustee pursuant to this Section 9.08, the Company's obligations under Section 9.07 hereof will continue for the benefit of the retiring Trustee. SECTION 9.09 SUCCESSOR TRUSTEE BY MERGER, ETC. (a) Subject to Section 9.10 hereof, if the Trustee with respect to any series of Securities consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act will be the successor Trustee; provided that in the case of a transfer of all or substantially all of its corporate trust business to another corporation, the transferee corporation expressly assumes all of the Trustee's liabilities hereunder. (b) In case any Securities of any series 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 9.10 ELIGIBILITY; DISQUALIFICATION (a) There will at all times be a Trustee hereunder which will (i) be a corporation organized and doing business under the laws of the United States, any state thereof or the District of Columbia, authorized under such laws to exercise corporate trustee power, (ii) be subject to supervision or examination by federal or state (or the District of Columbia) authority and (iii) have a combined capital and surplus of at least $150 million as set forth in its most recent published annual report of condition. (b) This Indenture will always have a Trustee who satisfies the requirements of TIA Sections 310(a)(1) and 310(a)(2). The Trustee is subject to TIA Section 310(b). If at any 44 53 time the Trustee ceases to be eligible in accordance with the provisions of this Section 9.10, it will resign immediately in the manner and with the effect specified in Section 9.08 hereof. SECTION 9.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY The Trustee is subject to TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). A Trustee who has resigned or been removed will be subject to TIA Section 311(a) to the extent indicated therein. ARTICLE 10 HOLDERS' LISTS SECTION 10.01 COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF HOLDERS The Company will furnish or cause to be furnished to the Trustee: (i) semi-annually, not more than 15 days before each Interest Payment Date, a list, in such form as the Trustee may reasonably require, of the names and addresses of the Holders of such series of Securities as of the Regular Record Date of such Interest Payment Date; and (ii) at such other times as the Trustee may request in writing, within 30 days after 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, however, that if and so long as the Trustee will be the Registrar, no such list need be furnished. SECTION 10.02 PRESERVATION OF INFORMATION The Trustee will preserve, in as current a form as is reasonably practicable, the names and addresses of Holders of each series of Securities contained in the most recent list furnished to the Trustee as provided in Section 10.01 hereof and the names and addresses of such Holders received by the Trustee in its capacity as Registrar or Paying Agent (if so acting). The Trustee may destroy any list furnished to it as provided in Section 10.01 hereof upon receipt of a new list so furnished. 45 54 ARTICLE 11 DEFEASANCE AND COVENANT DEFEASANCE SECTION 11.01 COMPANY'S OPTION TO EFFECT DEFEASANCE OR COVENANT DEFEASANCE The Company may elect, at its option by Board Resolution at any time, to have either Section 11.02 or 11.03 hereof applied to the Outstanding Securities of any series designated pursuant to Section 3.01 hereof as being defeasible pursuant to this Article 11 (hereinafter called a "Defeasible Series"), upon compliance with the conditions set forth below in this Article 11. SECTION 11.02 DEFEASANCE AND DISCHARGE Upon the Company's exercise of the option provided in Section 11.01 hereof to have this Section 11.02 applied to the Outstanding Securities of any Defeasible Series, the Company shall be deemed to have been discharged from its obligations with respect to the Outstanding Securities of such series as provided in this Section 11.02 on and after the date the conditions set forth in Section 11.04 hereof 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 the Outstanding Securities of such series, which shall thereafter be deemed to be "Outstanding" only for the purposes of Section 11.05 hereof and the other Sections of this Indenture referred to in (i) and (ii) below, and to have satisfied all its other obligations under the Securities of such series and this Indenture insofar as such Securities are concerned (and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following which shall survive until otherwise terminated or discharged hereunder: (i) the rights of Holders of Outstanding Securities of such series to receive solely from the trust fund described in Section 11.04 hereof and as more fully set forth in such Section, payments in respect of the principal of and interest on such Securities of such series when payments are due, (ii) the Company's obligations with respect to the Securities of such series under Sections 3.04, 3.05, 3.06, 6.02 and 6.04 hereof, (iii) the rights, powers, trusts, duties and immunities of the Trustee hereunder and (iv) this Article 11. Subject to compliance with this Article 11, the Company may exercise its option provided in Section 11.01 hereof to have this Section 11.02 applied to the Outstanding Securities of any Defeasible Series notwithstanding the prior exercise of its option provided in Section 11.01 hereof to have Section 11.03 hereof applied to such Outstanding Securities. SECTION 11.03 COVENANT DEFEASANCE Upon the Company's exercise of the option provided in Section 11.01 hereof to have this Section 11.03 applied to the Outstanding Securities, (i) the Company shall be released from its obligations under Sections 6.03 and 6.06 through 6.10, inclusive, Article 7, and any 46 55 other covenants specified in or pursuant to this Indenture and (ii) the occurrence of any event specified in Sections 8.01(a)(iv) (with respect to any of Sections 6.03 and 6.06 through 6.10 inclusive, and any other covenants specified in or pursuant to this Indenture) and 8.01(a)(x) shall be deemed not to be or result in an Event of Default, in each case with respect to the Outstanding Securities of such series as provided in this Section 11.03 on and after the date the conditions set forth in Section 11.04 hereof are satisfied (hereinafter called "Covenant Defeasance"), and such Securities shall thereafter be deemed not to be "Outstanding" for the purposes of any direction, waiver, consent, declaration or act of Holders (and the consequences thereof) in connection with such covenants, but shall continue to be "Outstanding" for all other purposes hereunder. For this purpose, such Covenant Defeasance means that, with respect to such Outstanding 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 covenant, whether directly or indirectly by reason of any reference elsewhere herein to any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or Event of Default under Section 8.01(a)(iv) or 8.01(a)(x), or otherwise, as the case may be, but, except as specified above, the remainder of this Indenture and the Securities of such series shall be unaffected thereby. SECTION 11.04 CONDITIONS TO DEFEASANCE OR COVENANT DEFEASANCE The following shall be the conditions to application of either Section 11.02 or 11.03 hereof to the Outstanding Securities of any Defeasible Series: (i) The Company shall irrevocably have deposited or caused to be deposited with the Trustee (or another trustee that satisfies the requirements contemplated by Section 9.10 hereof and agrees to comply with the provisions of this Article 11 applicable to it) as trust funds in trust for the purpose of making the following payments, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of Outstanding Securities of such series, (A) money in an amount, or (B) U.S. Government Obligations that through the scheduled payment of principal and interest in respect thereof in accordance with their terms will provide, not later than one day before the due date of any payment, money in an amount, or (C) a combination thereof, in each case sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge, and which shall be applied by the Trustee (or any such other qualifying trustee) to pay and discharge, (1) the principal of and interest on the Securities of such series on the respective Stated Maturities (or redemption date, if applicable) of such principal or installment of interest and (2) any mandatory sinking fund payments or analogous payments applicable to such Outstanding Securities on the day on which such payments are due and payable in accordance with the terms of this Indenture and such Securities; provided that the Trustee shall have been irrevocably instructed to apply such money or the proceeds of such U.S. 47 56 Government Obligations to said payments with respect to such Securities. Before such a deposit, the Company may give to the Trustee, in accordance with Section 4.02 hereof, a notice of its election to redeem all or any portion of such Outstanding Securities at a future date in accordance with the terms of the Securities of such series and Article 4 hereof, which notice shall be irrevocable. Such irrevocable redemption notice, if given, shall be given effect in applying the foregoing. (ii) In the case of an election under Section 11.02 hereof, 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 first set forth hereinabove, there has been a change in the applicable Federal income tax law, in either case, to the effect that, and based thereon such opinion shall confirm that, the Holders of the Outstanding Securities of such series will not recognize gain or loss for Federal income tax purposes as a result of such Defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at the same times as would be the case if such deposit, Defeasance and discharge were not to occur. (iii) In the case of an election under Section 11.03 hereof, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders of the Outstanding Securities of such series will not recognize income, gain or loss for Federal income tax purposes as result of such Covenant Defeasance and will be subject to Federal income tax on the same amounts, in the same manner and at the same times as would be the case if such deposit and Covenant Defeasance were not to occur. (iv) The Company shall have delivered to the Trustee an Officers' Certificate to the effect that the Securities of such series, if then listed on any securities exchange, will not be delisted as a result of such Defeasance or Covenant Defeasance. (v) No Default or Event of Default shall have occurred and be continuing at the time of such deposit. (vi) Such Defeasance or Covenant Defeasance shall not cause the Trustee to have a conflicting interest within the meaning of the TIA (assuming all Securities are in default within the meaning of the TIA). (vii) Such Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under, any other agreement or instrument to which the Company is a party or by which it is bound. 48 57 (viii) Notwithstanding any other provisions of this Section, such Defeasance or Covenant Defeasance shall be effected in compliance with any additional or substitute terms, conditions or limitations in connection therewith pursuant to Section 3.01 hereof. (ix) The Company shall have delivered to the Trustee an Officers' Certificate, stating that all conditions precedent with respect to such Defeasance or Covenant Defeasance have been complied with. (x) No event or condition shall exist that, pursuant to the provisions of Article 16 hereof, would prevent the Company from making payments of the principal of or interest on the Securities of such series on the date of such deposit or at any time during the period ending on the 91st day after the date of such deposit (it being understood that this condition shall not be deemed satisfied until the expiration of such period). 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 of 1940, as amended, unless such trust shall be qualified under such Act or exempt from regulation thereunder. SECTION 11.05 DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS Subject to the provisions of Section 6.04(e) hereof, all money and U.S. Government Obligations (or other property as may be provided pursuant to Section 3.01 hereof) (including the proceeds thereof) deposited with the Trustee or other qualifying trustee (solely for purposes of this Section 11.05 and Section 11.06 hereof, the Trustee and any such other trustee are referred to collectively as the "Trustee") pursuant to Section 11.04 hereof in respect of the Outstanding Securities of any Defeasible Series shall be held in trust and applied by the Trustee, in accordance with the provisions of the Outstanding Securities of such series 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 interest, but such 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 U.S. Government Obligations deposited pursuant to Section 11.04 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge that by law is for the account of the Holders of Outstanding Securities. Anything in this Article 11 to the contrary notwithstanding, the Trustee shall deliver or pay to the Company any money or U.S. Government Obligations (or other property 49 58 and any proceeds therefrom) held by it with respect to Outstanding Securities of any Defeasible Series that are in excess of the amount thereof that was used to pay the Securities of such series upon Maturity. SECTION 11.06 REINSTATEMENT If the Trustee or the Paying Agent is unable to apply any money in accordance with this Article 11 with respect to the Securities of any series by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company's obligations under this Indenture and the Securities of such series shall be revived and reinstated as though no deposit had occurred pursuant to this Article 11 with respect to Securities of such series until such time as the Trustee or Paying Agent is permitted to apply all money held in trust pursuant to Section 11.05 hereof with respect to Securities of such series in accordance with this Article 11; provided, however, that if the Company makes any payment of principal of or interest on any Security of such series following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of Securities of such series to receive such payment from the money so held in trust. ARTICLE 12 SATISFACTION AND DISCHARGE SECTION 12.01 SATISFACTION AND DISCHARGE OF INDENTURE This Indenture shall upon Company Request cease to be of further effect with respect to any series of Securities (except as to any surviving rights of registration of transfer or exchange of Securities of such series herein expressly provided for) and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture as to such series when (i) either (A) all Securities of such series theretofore authenticated and delivered (other than (i) Securities of such series which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 3.06 hereof, and (ii) Securities of such series for whose payment money has theretofore been deposited in trust with the Trustee or any Paying Agent or segregated and held in trust by the Company and thereafter repaid to the Company, as provided in Section 6.04 hereof) have been delivered to the Trustee for cancellation; or 50 59 (B) all Securities of such series and, in the case of (1) or (2) below, not theretofore delivered to the Trustee for cancellation (1) have become due and payable, or (2) will become due and payable at their Stated Maturity within one year, or (3) if redeemable at the option of the Company, are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company, and the Company, in the case of (1), (2) or (3) above, has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust for such purpose an amount in cash sufficient to pay and discharge the entire indebtedness on such Securities not theretofore delivered to the Trustee for cancellation, for principal 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; (ii) the Company has paid or caused to be paid all other sums payable hereunder by the Company; and (iii) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture as to such series have been complied with. Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 9.07 hereof and, if money shall have been deposited with the Trustee pursuant to subclause (B) of clause (i) of this Section 12.01, the obligations of the Trustee under Sections 12.02 and 6.04(e) hereof shall survive. SECTION 12.02 APPLICATION OF TRUST MONEY Subject to the provisions of Section 6.04(e) hereof, all money deposited with the Trustee pursuant to Section 12.01 hereof shall be held in trust and applied by it, in accordance with the provisions of the Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal and interest for whose payment such money has been deposited with the Trustee; but such money need not be segregated from other funds except to the extent required by law. 51 60 ARTICLE 13 SUPPLEMENTAL INDENTURES SECTION 13.01 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS (a) The Company and the Trustee may amend this Indenture or the Securities or waive any provision hereof without the consent of any Holder: (i) to cure any ambiguity, defect or inconsistency; (ii) to comply with Section 7.01 hereof; (iii) to provide for uncertificated Securities in addition to certificated Securities; (iv) to make any change that does not adversely affect the legal rights hereunder of any Holder of a Security of any series; (v) to add to the covenants of the Company 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; (vi) to add any additional Events of Default for the benefit of the Holders of all or any series of Securities (and if such Events of Default are to be for the benefit of less than all series of Securities, stating that such Events of Default are being included solely for the benefit of such series); (vii) to change or eliminate any of the provisions of this Indenture in respect of one or more series of Securities; provided that any such addition, 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; (viii) to establish the form or terms of Securities of any series as permitted by Sections 2.01 and 3.01 hereof; (ix) to evidence and provide for the acceptance of appointment hereunder of a successor Trustee with respect to the Securities of one or more 52 61 series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 9.08 hereof; (x) to supplement any of the provisions of the Indenture to such extent as shall be necessary to implement the provisions of Article 11 hereof or discharge of any series of Securities pursuant to Sections 12.01, 12.02 and 12.03 hereof; provided that any such action shall not adversely affect the interests of the Holders of Securities of such series or any other series in any material respect; or (xi) to comply with the qualification of this Indenture under the TIA. (b) Upon the request of the Company, accompanied by a Board Resolution authorizing the execution of any such supplemental indenture, and upon receipt by the Trustee of the documents described in Section 13.06 hereof, the Trustee will join with the Company in the execution of any supplemental indenture authorized or permitted by the terms of this Indenture and make any further appropriate agreements and stipulations that may be contained therein. After an amendment or waiver under this Section 13.01 becomes effective, the Company will mail to the Holders of each Security affected thereby a notice describing the amendment or waiver. Any failure of the Company to mail such notice, will not, however, affect the validity of any such supplemental indenture. SECTION 13.02 SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS (a) Except as provided below in this Section 13.02, the Company and the Trustee may amend this Indenture or the Securities with the written consent (including consents obtained in connection with a tender offer or exchange offer for Securities) of the Holders of at least a majority in principal amount of the Outstanding Securities of each series affected by such amendment. (b) Upon the request of the Company, accompanied by a Board Resolution authorizing the execution of any such supplemental indenture, and upon the filing with the Trustee of evidence of the consent of the Holders as aforesaid, and upon receipt by the Trustee of the documents described in Section 13.06 hereof, the Trustee will join with the Company in the execution of such supplemental indenture. (c) It will not be necessary for the consent of the Holders under this Section 13.02 to approve the particular form of any proposed amendment or waiver, but it will be sufficient if such consent approves the substance thereof. (d) The Holders of a majority in principal amount of the Outstanding Securities of each series affected may waive compliance in a particular instance by the Company 53 62 with any provision of this Indenture (including waivers obtained in connection with a tender offer or exchange offer for Securities). However, without the consent of each Holder of an Outstanding Security affected thereby, an amendment or waiver under this Section 13.02 may not: (i) change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Security, or reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or change the Place of Payment where any Security or interest thereon is payable, or change 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 or repayment at the option of the Holder, on or after the redemption date or repayment date), or (ii) reduce the percentage in principal amount of the Outstanding Securities of any series, the consent of whose Holders is required for any such amendment, 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 (iii) modify any of the provisions of this Section or Section 8.07, 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, or (iv) modify any of the provisions of this Indenture relating to the subordination of the Securities in a manner adverse to the Holders. (e) A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture 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. (f) The right of any Holder to participate in any consent required or sought pursuant to any provision of this Indenture (and the obligation of the Company to obtain any such consent otherwise required from such Holder) may be subject to the requirement that such Holder has been the Holder of record of any Securities of any series with respect to which such consent is required or sought as of a date identified by the Trustee in a notice furnished to Holders in accordance with the terms of this Indenture. 54 63 SECTION 13.03 COMPLIANCE WITH TIA Every amendment to this Indenture or the Securities will comply in form and substance with the TIA as then in effect. SECTION 13.04 REVOCATION AND EFFECT OF CONSENTS (a) Until an amendment (which includes any supplement) or waiver becomes effective, a consent to it by a Holder of a Security of any series is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder's Security, even if notation of the consent is not made on any Security. However, any such Holder or subsequent Holder may revoke the consent as to such Holder's Security or portion of a Security if the Trustee receives written notice of revocation before the date the amendment or waiver becomes effective. An amendment or waiver becomes effective in accordance with its terms and thereafter binds every Holder. (b) The Company may, but will not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment or waiver. If the Company elects to fix a record date for such purpose, the record date will be fixed at (i) the later of 30 days prior to the first solicitation of such consent or the date of the most recent list of Holders furnished to the Trustee prior to such solicitation pursuant to Section 10.02 hereof or (ii) such other date as the Company will designate. If a record date is fixed, then notwithstanding the provisions of Section 13.04(a) hereof, those Persons who were Holders at such record date (or their duly designated proxies), and only those Persons, will be entitled to consent to such amendment or waiver or to revoke any consent previously given, whether or not such Persons continue to be Holders after such record date. No consent will be valid or effective for more than 90 days unless consents from Holders of the principal amount of Securities required hereunder for such amendment or waiver to be effective has also been given and not revoked within such 90-day period. (c) After an amendment or waiver becomes effective it will bind every Holder of a Security of any series affected thereby, unless it is of the type described in any of clauses (i) through (iv) of Section 13.02(d) hereof. Any amendment or waiver will bind each Holder of a Security who has consented to it and every subsequent Holder of a Security that evidences the same debt as the consenting Holder's Security. SECTION 13.05 NOTATION ON OR EXCHANGE OF SECURITIES The Trustee may place an appropriate notation about an amendment or waiver on any Security of any series affected thereby thereafter authenticated. The Company in exchange for all Securities of such series may issue and the Trustee will authenticate new Securities of such series that reflect the amendment or waiver. 55 64 SECTION 13.06 TRUSTEE TO SIGN AMENDMENTS, ETC. The Trustee will sign any amendment or supplemental indenture authorized pursuant to this Article 13 if the amendment does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may, but need not, sign it. In signing or refusing to sign such amendment or supplemental indenture, the Trustee will be entitled to receive and, subject to Section 9.01 hereof, will be fully protected in relying upon, an Officers' Certificate and an Opinion of Counsel as conclusive evidence that such amendment or supplemental indenture is authorized or permitted by this Indenture, that it is not inconsistent herewith, and that it will be valid and binding upon the Company in accordance with its terms. SECTION 13.07 SUBORDINATION UNIMPAIRED This Indenture may not be amended to alter the subordination of any Outstanding Securities without the written consent of each holder of Senior Indebtedness then outstanding that would be adversely affected thereby. ARTICLE 14 MISCELLANEOUS SECTION 14.01 TIA CONTROLS If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by TIA Section 318(c), the imposed duties will control. SECTION 14.02 NOTICES (a) Any notice or communication by the Company or the Trustee to the other is duly given if in writing and delivered in person or mailed by first class mail (registered or certified, return receipt requested), telex, telecopier or overnight air courier guaranteeing next day delivery, to the other's address: If to the Company: U.S. Home Corporation 1800 West Loop South Houston, Texas 77027 Telecopier No.: (713) 877-2387 Confirmation No.: (713) 877-2311 Attention: President 56 65 If to the Trustee: IBJ Schroder Bank & Trust Company One State Street New York, New York 10004 Telecopier No.: (212) 858-2952 Confirmation No.: (212) 858-2529 Attention: Corporate Trust Agency & Administration (b) The Company or the Trustee, by notice to the other, may designate additional or different addresses for subsequent notices or communications. (c) All notices and communications will be deemed to have been duly given: at the time delivered by hand, if personally delivered; five Business Days after being deposited in the mail, if mailed; when answered back, if telexed; when receipt acknowledged by the Trustee's result report, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery. (d) Any notice or communication to a Holder will be mailed by first-class, postage-prepaid mail, return receipt requested, to the Holder's address shown on the register kept by the Registrar. Failure to mail a notice or communication to a Holder or any defect in it will not affect its sufficiency with respect to other Holders. (e) If a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it. (f) If the Company mails a notice or communication to Holders, it will mail a copy to the Trustee and each Agent at the same time. SECTION 14.03 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS Holders may communicate pursuant to TIA Section 312(b) with other Holders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Securities Register and anyone else will have the protection of TIA Section 312(c). SECTION 14.04 ACTION BY SECURITYHOLDERS Whenever in this Indenture it is provided that the Holders of a specified percentage in aggregate principal amount of the Outstanding Securities may take any action (including the making of any demand or request, the giving of any notice, consent or waiver or the taking of any other action), the fact that at the time of taking any such action the Holders of such specified percentage have joined therein may be evidenced by any instrument or any 57 66 number of instruments of similar tenor executed by (i) Holders in person or (ii) agent or proxy appointed in writing, or by the record of the Holders in favor thereof, at any meeting of Holders duly called and held in accordance with the provisions of Article 15 hereof, or (iii) a combination of such instrument or instruments of any such record of such meeting of Holders, but in each case only to the extent that the Holders shall not have revoked such action pursuant to Section 13.04 hereof. Without limiting the generality of this Section 14.04, a Holder, including a Depository that is a Holder of one or more Global Securities, may make, give or take, by a proxy or proxies duly appointed in writing, any request, demand, authorization, direction, notice, consent, waiver or other action provided in this Indenture to be made, given or taken by Holders and a Depository that is a Holder of one or more Global Securities may provide its proxy or proxies to the beneficial owners of interests in any such Global Securities through such Depository's standing instructions and customary practices. The Company, with advance approval by the Trustee, Trustee will fix a record date for the purpose of determining the Persons who are beneficial owners of interests in any Global Security held by a Depository entitled under the procedures of such Depository to make, give or take, by a proxy or proxies duly appointed in writing, any request, demand, authorization, direction, notice, consent, waiver or other action provided in this Indenture to be made, given or taken by Holders. If such a record date is fixed, the Persons who are such beneficial owners at the close of business on such record date or their duly appointed proxy or proxies will be entitled to make, give or take such request, demand, authorization, direction, notice, consent, waiver or other actions, whether or not such Persons remain such beneficial owners after such record date. No such request, demand, authorization, direction, notice, consent, waiver or other action will be valid or effective if made, given or taken more than six months after such record date. SECTION 14.05 PROOF OF EXECUTION OF INSTRUMENTS AND HOLDING OF SECURITIES Proof of the execution of any instrument by a Holder or such Holder's agent or proxy and proof of the holding by any Person of any of the Securities shall be sufficient if made in the following manner: (1) The fact and date of the execution by any such Person of any instrument may be proved by the certificate of any notary public or other officer of any jurisdiction authorized to take acknowledgments of deeds to be recorded in such jurisdiction that the Person executing such instrument acknowledged to him the execution thereof, or by an affidavit of a witness to such execution sworn to before any such notary or other officer. Such certificate or affidavit shall also constitute sufficient proof of the authority of the Person executing any instrument in cases where Securities are not held by Persons in their individual capacities. 58 67 (2) The fact and date of execution of any such instrument may also be proved in any other manner which the Trustee deems sufficient. (3) The ownership of Securities shall be proved by the Securities Register for such Security or by a certificate of the Registrar. (4) The Trustee shall not be bound to recognize any Person as a Securityholder unless such Holder's title to any Security held by such Holder is proved in the manner provided in this Section 14.05. The Trustee may require such additional proof of any matter referred to in this Section 14.05 as it shall deem necessary. SECTION 14.06 OBLIGATION TO DISCLOSE BENEFICIAL OWNERSHIP OF SECURITIES All Securities shall be held and owned upon the express condition that, upon demand of any regulatory agency having jurisdiction over the Company, and pursuant to law or regulation empowering such agency to assert such demand, any Holder shall disclose to such agency the identity of the beneficial owner of all Securities held by such Holder. SECTION 14.07 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company will furnish to the Trustee and the Trustee may rely upon, as conclusive evidence: (i) an Officers' Certificate (which will include the statements set forth in Section 14.08 hereof) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been complied with; and (ii) an Opinion of Counsel (which will include the statements set forth in Section 14.08 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been complied with. SECTION 14.08 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION (a) Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA Section 314(a)(4)) will include: 59 68 (i) a statement that the Person making such certificate or opinion has read such condition or covenant; (ii) 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; (iii) a statement that, in the opinion of such Person, such Person has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such condition or covenant has been complied with; and (iv) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with. (b) Any Officers' Certificate may be based, insofar as it relates to legal matters, upon an Opinion of Counsel, unless such Officer knows that the opinion with respect to the matters upon which his certificate may be based as aforesaid is erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any Opinion of Counsel may be based, insofar as it relates to factual matters, upon the certificate, statement or opinion of or representations by an officer or officers of the Company, or other Persons or firms deemed appropriate by such counsel, unless such counsel has actual knowledge that the certificate, statement or opinion or representations with respect to the matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous. (c) Any Officers' Certificate, statement or Opinion of Counsel may be based, insofar as it relates to accounting matters, upon a certificate or opinion of or representation by an accountant (who may be an employee of the Company), or firm of accountants, unless such Officer or counsel, as the case may be, has actual knowledge that the certificate or opinion or representation with respect to the accounting matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous. SECTION 14.09 RULES BY TRUSTEE AND AGENTS The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions. SECTION 14.10 NO RECOURSE AGAINST OTHERS 60 69 A director, officer or employee of the Company, as such, will have no liability for any obligations of the Company under the Securities or this Indenture. Each Holder by accepting a Security waives and releases all such liability. SECTION 14.11 GOVERNING LAW This Indenture and the Securities will be governed by and construed in accordance with the laws of the State of New York, without regard to principles of conflicts of law. SECTION 14.12 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary thereof. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. This writing constitutes the entire agreement of the parties with respect to the subject matter hereof. Unless expressly otherwise indicated herein, an action or transaction permitted by one provision hereof must nonetheless comply with all other applicable provisions hereof; and any action or transaction not permitted by any provision of this Indenture will not be permitted regardless of whether any other provision hereof might permit such action or transaction. SECTION 14.13 SUCCESSORS All agreements of the Company in this Indenture and the Securities will bind its successors. All agreements of the Trustee in this Indenture will bind its successors. SECTION 14.14 SEVERABILITY In case any provision in this Indenture or in the Securities is invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions will not in any way be affected or impaired thereby. SECTION 14.15 COUNTERPART ORIGINALS The parties may sign any number of copies of this Indenture. Each signed copy will be an original, but all of them together represent the same agreement. SECTION 14.16 TRUSTEE AS PAYING AGENT AND REGISTRAR The Company initially appoints the Trustee as Paying Agent and Registrar. 61 70 SECTION 14.17 TABLE OF CONTENTS, HEADINGS, ETC. The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof and will in no way modify or restrict any of the terms or provisions hereof. SECTION 14.18 BENEFITS OF INDENTURE Nothing in this Indenture or in the Securities, express or implied, will give to any Person, other than the parties hereto and their successors hereunder, the holders of Senior Indebtedness and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture. SECTION 14.19 ACCEPTANCE OF TRUST IBJ Schroder Bank & Trust Company, the Trustee named herein, hereby accepts the trusts in this Indenture declared and provided, upon the terms and conditions hereinabove set forth. ARTICLE 15 MEETINGS OF HOLDERS OF SECURITIES SECTION 15.01 PURPOSES OF MEETINGS A meeting of Holders may be called at any time and from time to time pursuant to the provisions of this Article 15 for any of the following purposes: (A) to give any notice to the Company or to the Trustee, or to give any direction to the Trustee, or to waive any non-performance hereunder, and its consequences, or to take any other action authorized to be taken by Holders pursuant to any of the provisions of this Indenture; (B) to remove the Trustee and appoint a successor Trustee pursuant to the provisions of Section 9.08 hereof; (C) to consent to the amendment of the provisions contained herein and the execution of an indenture or indentures supplemental hereto pursuant to the provisions of Article 13 hereof; or 62 71 (D) to take any other action authorized to be taken by or on behalf of the Holders of any specified aggregate principal amount of the Outstanding Securities under any other provision of this Indenture or under applicable law. SECTION 15.02 CALL OF MEETINGS BY TRUSTEE The Trustee may at any time call a meeting of Holders to take any action specified in Section 15.01, to be held at such time and at such place in the State of New York, as the Trustee shall determine. Notice of each meeting of the Holders of Securities, setting forth the time and the place of such meeting and, in general terms, the action proposed to be taken at such meeting, shall be mailed by the Trustee to the Holders, not less than 20 nor more than 60 days prior to the date fixed for the meeting, at their last addresses as they shall appear on the Security Register. SECTION 15.03 CALL OF MEETINGS BY COMPANY OR SECURITYHOLDERS If at any time the Company, pursuant to a Board Resolution, or the Holders of at least 20 percent in aggregate principal amount of the Outstanding Securities, shall have requested the Trustee to call a meeting of Holders to take any action authorized in Section 15.01 hereof, by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have mailed notice of such meeting within 20 days after receipt of such request, then the Company or the Holders in the amount above specified may determine the time and the place in the State of New York for such meeting, and may call such meeting by mailing notice thereof as provided in Section 15.02. SECTION 15.04 PERSON ENTITLED TO VOTE AT MEETING To be entitled to vote at any meeting of Holders, a Person shall be a Holder or be a Person appointed by an instrument in writing as proxy by a Holder. The only Persons who shall be entitled to be present or speak at any meeting of the Holders shall be the Persons entitled to vote at such meeting and their counsel and any representatives of the Company and its counsel. SECTION 15.05 REGULATIONS FOR MEETING Notwithstanding any provisions of this Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Holders in regard to the appointment of proxies, the proof of the holding of Securities, the appointment and duties of inspectors of votes, the submission and examination of proxies and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall think fit. Except as otherwise permitted or required by any such regulations, the holding of Securities shall be proved in the manner specified in Section 14.05 hereof and the appointment of any proxy shall be 63 72 proved in the manner specified in such Section 14.05 or by having the signature of the person executing the proxy witnessed or guaranteed by any bank, banker, trust company or New York Stock Exchange, Inc. member firm satisfactory to the Trustee. The Trustee shall, by an instrument in writing, appoint a temporary chairperson of the meeting, unless the meeting shall have been called by the Company or by the Holders as provided in Section 15.03, in which case the Company or the Holders calling the meeting, as the case may be, shall appoint a temporary chairman. A permanent chairperson and a permanent secretary of the meeting shall be elected by vote of the Holders of a majority in principal amount of the Securities represented at the meeting and entitled to vote. At any meeting of Holders, the presence of Persons holding or representing Securities in an aggregate principal amount sufficient to take action upon the business for the transaction of which such meeting was called shall be necessary to constitute a quorum; but, if less than a quorum be present, the Persons holding or representing a majority in aggregate principal amount of the Securities represented at the meeting may adjourn such meeting with the same effect, for all intents and purposes, as though a quorum had been present. ARTICLE 16 SUBORDINATION; SENIORITY SECTION 16.01 SECURITIES SUBORDINATED TO SENIOR INDEBTEDNESS (a) The Company agrees, and each Holder of a Security of any series by such Holder's acceptance thereof likewise agrees, that the payment of the principal of, and interest on (including, without limitation, interest accruing subsequent to the filing of a petition under applicable Bankruptcy Law or the appointment of a Custodian), the Securities of each series hereunder is subordinated and junior in right of payment, to the extent and in the manner provided in this Article 16, except as provided in Section 9.07, to the prior payment in full in cash or Cash Equivalents or all Senior Indebtedness whether outstanding on the Issue Date of the Securities of any series or created, incurred, assumed or guaranteed thereafter. The Securities of any series shall rank pari passu with the Company's 4 7/8% Convertible Subordinated Debentures due 2005. (b) All the provisions of this Indenture and the Securities of any series will be subject to the provisions of this Article 16 so far as they may be applicable thereto, except that nothing in this Article 16 will apply to claims for, or payments to, the Trustee under or pursuant to Section 9.07 hereof. 64 73 SECTION 16.02 COMPANY NOT TO MAKE PAYMENTS WITH RESPECT TO SECURITIES IN CERTAIN CIRCUMSTANCES (a) No payment will be made by the Company on account of principal of or interest on the Securities of any series, nor may the Company purchase or otherwise acquire such Securities for cash or property (other than Capital Stock or other securities of the Company that are subordinated to Senior Indebtedness to at least the same extent as the Securities) if at the time of such payment or immediately after giving effect thereto there will have occurred and be continuing (i) a default in the payment of principal of (or premium, if any, on) or interest on any Designated Senior Indebtedness continuing beyond the applicable period of grace, if any, specified in the applicable instrument, lease, contract, agreement or other document evidencing such Designated Senior Indebtedness a default, other than a payment default as specified in clause (i) of this Section 16.02(a), that permits the holders of Designated Senior Indebtedness to accelerate the maturity thereof, and the Trustee shall have received notice thereof from the trustee or other representative of the holders of Designated Senior Indebtedness, which notice shall request that payment of principal or interest on the Securities be prohibited (provided, however, that in the case of Designated Senior Indebtedness issued pursuant to an indenture, such notice may be validly given only by the trustee under such indenture), provided that the foregoing will not prohibit payments made pursuant to Articles 11 or 12 hereof from monies deposited with the Trustee pursuant thereto prior to any such default, judicial proceeding or notice. (b) Notwithstanding Section 16.02(a) hereof, the Company shall resume payments on the Securities of any series and may acquire such Securities upon the earlier of: (i) the date upon which the default or event of default as specified in Section 16.02(a) hereof is cured or waived or ceases to exist, or (ii) in the case of an event of default as specified in clause (ii) of Section 16.02(a), the expiration of 179 days after such notice as set forth in clause (ii) of Section 16.02(a) is received (each such period under clause (ii) of this Section 16.02(b), a "Payment Blockage Period"). Notwithstanding anything in this Section 16.02(b) to the contrary, (A) only one such Payment Blockage Period may be commenced within any 365 consecutive day period and (B) in no event will a Payment Blockage Period extend beyond 179 days from the date the payment on the Securities of any series is due. For purposes of this Section 16.02, no default which, to the knowledge of the trustee or other representative of Designated Senior Indebtedness, existed or was continuing on the date of the commencement of any Payment Blockage Period shall be, or be made, the basis for the commencement of a second Payment Blockage Period by such trustee or representative, whether or not within a period of 365 consecutive days, unless such default shall have been cured or waived or shall have ceased to exist, or the benefits of this Section 16.02(b) shall have been waived in writing by such trustee or representative for a period of not less than 90 consecutive days. (c) Upon any acceleration of the principal of the Securities of any series or any payment by the Company, or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to creditors upon any dissolution or winding up or liquidation or reorganization of the Company, whether voluntary or involuntary, or in bankruptcy, insolvency, receivership or other proceedings, all amounts due or to become due upon all Senior Indebtedness (including, without limitation, interest accruing subsequent to the filing of a petition under applicable Bankruptcy Law or the appointment of a Custodian) will first be paid in full in cash or Cash Equivalents, or payment thereof provided for, before any payment is made on account of the principal of or interest on the Securities (except payments made pursuant to Articles 11 or 12 hereof from monies deposited with the Trustee pursuant thereto prior to the happening of such dissolution, winding up, liquidation or reorganization); and upon any such dissolution or winding up or liquidation or reorganization, any payment by the Company, or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to which the Holders or the Trustee would be entitled except for the provisions of this Article 16, will (except as aforesaid) be paid by the Company or by any Custodian or other Person, or by the Holders or the Trustee, making such payment or distribution directly to the holders of Senior Indebtedness (pro rata to such holders on the basis of the respective amounts of Senior Indebtedness held by such holders, as calculated by the Company) or their representative or representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing any Senior Indebtedness may have been issued, as their respective interests may appear, to the extent necessary so that the holders of all Senior 65 74 Indebtedness have been paid in full in cash or Cash Equivalents, after giving effect to any concurrent payment or distribution to or for the holders of Senior Indebtedness, before any payment or distribution is made to the Holders or to the Trustee, except that Holders shall be entitled to receive securities that are subordinated to Senior Indebtedness to at least the same extent as the Securities. (d) If the Trustee or any Holder does not file a proper claim or proof of debt in the form required in any proceeding referred to above prior to 30 days before the expiration of the time to file such claim in such proceeding, then the holder of any Senior Indebtedness is hereby authorized, and has the right, to file an appropriate claim or claims for or on behalf of the Trustee or such Holder. (e) In the event that, notwithstanding the foregoing, any payment by or distribution of assets of the Company of any kind or character, whether in cash, property or securities, prohibited by the foregoing, is received by the Trustee or the Holders before all Senior Indebtedness is paid in full in cash or Cash Equivalents, or provision is made for such payment in cash or Cash Equivalents, such payment or distribution will be paid over or delivered to the holders of Senior Indebtedness or their representative or representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing any Senior Indebtedness may have been issued, as their respective interests may appear, for application to the payment of all Senior Indebtedness remaining unpaid to the extent necessary to pay the holders of all Senior Indebtedness in full in cash or Cash Equivalents, after giving effect to any concurrent payment or distribution to or for the holders of such Senior Indebtedness, and, until so delivered, the same will be held in trust by the Trustee or any Holder as the property of the holders of Senior Indebtedness (but subject to the power of a court of competent jurisdiction to make other equitable provision, which will have been determined by such court to give effect to the rights conferred in this Article 16 upon the Senior Indebtedness and the holders thereof with respect to the Securities or the Holders or the Trustee, by a lawful plan of reorganization or readjustment under applicable Bankruptcy Laws). The Trustee will not have any obligation or duty to recover any such amounts so distributed. (f) The consolidation of the Company with, or the merger of the Company into, another corporation or the liquidation or dissolution of the Company following the conveyance or transfer of its property as an entirety, or substantially as an entirety, to another corporation upon the terms and conditions provided in Article 7 hereof will not be deemed a dissolution, winding up, liquidation or reorganization for the purposes of this Section 16.02 if such other corporation will, as a part of such consolidation, merger, conveyance or transfer, comply with the conditions stated in Article 7 hereof. Nothing in this Section 16.02 will apply to claims of, or payments to, the Trustee under or pursuant to Section 9.07 hereof. (g) The holders of Senior Indebtedness may, at any time and from time to time, without the consent of, or notice to, the Holders or the Trustee, without incurring responsibility to the Holders or the Trustee and without impairing or releasing the rights of any holder of Senior Indebtedness or in any way altering or affecting any of the provisions of this 66 75 Article 16: (i) change the amount, manner, place or terms of payment or change or extend the time of payment of, or renew or alter, Senior Indebtedness, or otherwise amend in any manner Senior Indebtedness or any instrument evidencing the same or any agreement under which Senior Indebtedness is outstanding, (ii) sell, exchange, release or otherwise deal with any property pledged, mortgaged or otherwise securing Senior Indebtedness, (iii) release any Person liable in any manner for the collection of Senior Indebtedness, and (iv) exercise or refrain from exercising any rights against the Company and any other Person. SECTION 16.03 SUBROGATION OF SECURITIES (a) Subject to the payment in full of all Senior Indebtedness at the time outstanding, the Holders will be subrogated (without any duty on the part of the holders of Senior Indebtedness to warrant, create, effectuate, preserve or protect each subrogation) to the rights of the holders of Senior Indebtedness to receive payments or distributions of cash, property or securities of the Company applicable to the Senior Indebtedness until the principal of and interest on the Securities of each series will be paid in full; and, for the purposes of such subrogation, no payments or distributions to the holders of Senior Indebtedness of any cash, property or securities to which the Holders or the Trustee on their behalf would be entitled except for the provisions of this Article 16, and no payments over pursuant to the provisions of this Article 16, to the holders of Senior Indebtedness by Holders or the Trustee on their behalf will, as between the Company, its creditors (other than holders of Senior Indebtedness), and the Holders, be deemed to be a payment by the Company to or on account of the Senior Indebtedness. It is understood that the provisions of this Article 16 are and are intended solely for the purpose of defining the relative rights of the Holders, on the one hand, and the holders of Senior Indebtedness, on the other. (b) Nothing contained in this Article 16 or elsewhere in this Indenture or in the Securities of any series is intended to or will impair, as among the Company, its creditors other than the holders of Senior Indebtedness and the Holders, the obligation of the Company, which is absolute and unconditional, to pay to the Holders the principal of and interest on the Securities of each series as and when the same will become due and payable in accordance with their terms, or is intended to or will affect the relative rights of the Holders and creditors of the Company other than the holders of Senior Indebtedness, nor will anything herein or therein prevent the Trustee or any Holder from exercising all remedies otherwise permitted by applicable law upon default under this Indenture, subject to the rights, if any, under this Article 16 of the holders of Senior Indebtedness in respect of cash, property or securities of the Company received upon the exercise of any such remedy. (c) Upon any payment or distribution of assets of the Company referred to in this Article 16, the Trustee and the Holders will be entitled to rely upon any order or decree made by any court of competent jurisdiction in which such dissolution, winding up, liquidation or reorganization proceedings are pending, or certificate of the Custodian or other Person making 67 76 such payment or distribution, delivered to the Trustee or to the Holders, for the purpose of ascertaining the holders of Senior Indebtedness and other Indebtedness of the Company and the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article 16. SECTION 16.04 AUTHORIZATION BY HOLDERS Each Holder by such Holder's acceptance of a Security of any series authorizes and directs the Trustee on such Holder's behalf to take such action as may be necessary or appropriate to effectuate, as between the Holder and the holders of Senior Indebtedness, the subordination provided in this Article 16 and appoints the Trustee such Holder's attorney-in-fact for any and all such purposes. SECTION 16.05 NOTICES TO TRUSTEE (a) The Company will give prompt written notice in the form of an Officers' Certificate to the Trustee of any fact known to the Company which would prohibit the making of any payment of monies to or by the Trustee in respect of the Securities of any series pursuant to the provisions of this Article 16. Notwithstanding the provisions of this Article 16 or any other provision of this Indenture, the Trustee will not be charged with knowledge of the existence of any facts which would prohibit the making of any payment of monies to or by the Trustee in respect of the Securities of any series pursuant to the provisions of this Article 16, unless and until the Trustee will have received at its Corporate Trust Office written notice thereof from the Company or a holder or holders of Senior Indebtedness or from a representative or trustee therefor; provided, that in the case of Senior Indebtedness issued pursuant to an indenture, such notice may be validly given only by the trustee under such indenture; and before the receipt of any such written notice, the Trustee will be entitled in all respects to assume that no such facts exist; provided further that if the Trustee will not have received, at least three Business Days prior to the date upon which by the terms hereof any such monies may become payable for any purpose (including, without limitation, the payment of the principal of or interest on any Security of any series), with respect to such monies, the notice provided for in this Section 16.05, then, anything herein contained to the contrary notwithstanding, the Trustee will have the full power and authority to receive such monies and to apply the same to the purpose for which they were received and will not be affected by any notice to the contrary which may be received by it within three Business Days prior to such date. (b) The Trustee will be entitled to rely on the delivery to it of a written notice by a Person representing himself or herself to be a holder of Senior Indebtedness (or a trustee on behalf of such holder) to establish that such notice has been given by a holder of Senior Indebtedness or a trustee or a representative on behalf of any 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 to participate in any payment or distribution pursuant 68 77 to this Article 16, the Trustee may request such Person to provide evidence to the reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such Person under this Article 16, 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. (c) Notwithstanding anything to the contrary hereinbefore set forth, nothing will prevent any payment by the (i) Company or the Trustee to the Holders of monies in connection with a redemption of Securities of any series if (A) notice of such redemption had been given pursuant to Article 4 hereof prior to the receipt by the Company or the Trustee, as applicable, of written notice as aforesaid, and (B) such notice of redemption is given not earlier than sixty days before the redemption date, or (ii) Trustee to the Holders of amounts deposited with it pursuant to Articles 11 or 12 hereof. (d) The Company agrees that if any default occurs with respect to any Senior Indebtedness, which default permits the holders of such Senior Indebtedness to accelerate the maturity thereof, the Company will give prompt notice in writing of such happening to all known holders of Senior Indebtedness and will certify to each such holder the name of the Trustee and current notice address. SECTION 16.06 TRUSTEE'S RELATION TO SENIOR INDEBTEDNESS (a) The Trustee in its individual capacity will be entitled to all the rights set forth in this Article 16 in respect of any Senior Indebtedness at any time held by it, to the same extent as any other holder of Senior Indebtedness, and nothing in Section 9.03 or elsewhere in this Indenture will deprive the Trustee of any of its rights as such holder. (b) With respect to the holders of Senior Indebtedness, the Trustee undertakes to perform or to observe only such of its covenants and obligations as are specifically set forth in this Article 16, and no implied covenants or obligations with respect to the holders of Senior Indebtedness will be read into this Indenture against the Trustee. The Trustee will not owe any fiduciary duty to the holders of Senior Indebtedness but will have only such obligations to such holders as are expressly set forth in this Article 16. SECTION 16.07 NO IMPAIRMENT OF SUBORDINATION No right of any present or future holder of any Senior Indebtedness to enforce subordination as herein provided will 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 an 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 69 78 of this Indenture, regardless of any knowledge thereof which any such holder may have or otherwise be charged with. SECTION 16.08 ARTICLE 16 NOT TO PREVENT EVENTS OF DEFAULT No provision of this Article 16 will prevent the occurrence of an Event of Default hereunder. SECTION 16.09 PAYING AGENTS OTHER THAN THE TRUSTEE In any case at any time any Paying Agent other than the Trustee has been appointed by the Company and be then acting hereunder, the term "Trustee" as used in this Article 16 will in such case (unless the context will otherwise require) be construed as extending to and including such Paying Agent within its meaning as fully for all intents and purposes as if 70 79 such place of the Trustee; provided, however, that Sections 16.05 and 16.06 hereof will not apply to the Company or any Subsidiary if it acts as Paying Agent. IN WITNESS WHEREOF, the undersigned have duly executed this Indenture as of the date first above written. U.S. HOME CORPORATION By: ------------------------------ IBJ SCHRODER BANK & TRUST COMPANY, as Trustee By: ------------------------------ Name: Title: 71 EX-5.1 5 OPINION OF KAYE, SCHOLER, FIERMAN, HAYS & HANDLER 1 EXHIBIT 5.1 [KAYE, SCHOLER, FIERMAN, HAYS & HANDLER, LLP] (212) 836-8000 July 16, 1997 U.S. Home Corporation 1800 West Loop South Houston, Texas 77027-3212 Ladies and Gentlemen: We have acted as counsel to U.S. Home Corporation, a Delaware corporation (the "COMPANY"), in connection with the Company's Registration Statement on Form S-3 (the "REGISTRATION STATEMENT") to be filed with the Securities and Exchange Commission (the "COMMISSION") under the Securities Act of 1933, as amended (the "ACT"), on the date hereof. The Registration Statement related to the registration under the Act of debt securities, which may be issued as senior, senior subordinated or subordinated debt (the "DEBT SECURITIES") of the Company. The Debt Securities are to be issued pursuant to one or more indentures (the "INDENTURES"), each to be entered into between the Company and IBJ Schroder Bank & Trust Company, as trustee (the "TRUSTEE"). The Debt Securities are being registered for offer and sale from time to time pursuant to Rule 415 under the Act. In connection herewith, we have examined the Registration Statement, the proposed forms of Indentures to be filed as exhibits to the Registration Statement, together with such corporate records, certificates and other documents, and such questions of law, as we have considered necessary or appropriate for the purposes of this opinion. Based upon the foregoing, we are of the opinion that when (i) the Registration Statement becomes effective under the Act, (ii) the Board of Directors of the Company, or a duly authorized committee thereof in accordance with the provisions of the Amended and Restated By-Laws of the Company, has taken all necessary action to fix and approve the rank and terms of the Debt Securities, including the form or forms of note to evidence the Debt Securities, in a manner that does not violate any applicable law, governmental or court-imposed order or restriction or agreement or instrument then binding on the Company, or otherwise impair the legal and binding nature of the obligations represented by the Debt Securities, (iii) the proposed 2 U.S. Home Corporation 2 July 16, 1997 Indentures pursuant to which the Debt Securities are to be issued shall have been qualified under the Trust Indenture Act of 1939, as amended, and duly executed and delivered by duly authorized officers of the Company and the Trustee in the forms filed as exhibits to the Registration Statement, with items shown in such exhibits as subject to completion completed in a manner satisfactory to us, and (iv) the Debt Securities are executed and authenticated in accordance with the terms of the Indenture and delivered to the purchasers thereof upon payment of the consideration therefor fixed by the Board of Directors of the Company, or a duly authorized committee thereof in accordance the provisions of the Amended and Restated By-Laws of the Company, the Debt Securities will constitute the valid and binding obligations of the Company, subject to applicable bankruptcy, insolvency, reorganization and similar laws affecting creditors' rights generally and general principles of equity (regardless whether such principles are considered in a proceeding in equity or an action at law). The foregoing opinion is limited to the laws of the State of New York and the General Corporation Law of the State of Delaware. The Debt Securities may be issued from time to time on a delayed or continuous basis and the foregoing opinion is limited to the laws, including the Rules and Regulations of the Commission, as in effect on the date hereof. We consent to the filing of this opinion with the Commission as an Exhibit to the Registration Statement and to the use of our name under the caption "Legal Matters" in the Prospectus included therein. Our opinion is rendered solely for your information in connection with the foregoing, and may not be relied upon by any other person or for any other purpose without our prior written consent. In giving this opinion, we do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Act or the Rules and Regulations of the Commission. Very truly yours, /s/ KAYE, SCHOLER, FIERMAN, HAYS & HANDLER, LLP EX-12 6 STATEMENTS RE: COMPUTATION OF RATIO OF EARNINGS 1 EXHIBIT 12 U.S. HOME CORPORATION AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES FOR THE FIVE YEARS ENDED DECEMBER 31, 1996 AND FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND 1997 (Dollars in thousands)
3 MONTHS ENDED YEAR ENDED DECEMBER 31, MARCH 31, - ------------------------------------------------------------------------------------------------------------------------------------ 1992 1993 1994 1995 1996 1996 1997 -------- -------- -------- -------- -------- -------- -------- COMPUTATION OF HISTORICAL RATIOS: EARNINGS-- NET INCOME (LOSS) FROM CONTINUING OPERATIONS $ 29,349 $ 78,606 $ 32,829 $ 36,920 $ 44,188 $ 9,319 $ 10,143 ADD: PROVISION (BENEFIT) FOR INCOME TAXES OF U.S. HOME CORPORATION -- (33,966) 19,697 22,152 11,713 5,357 5,957 FIXED CHARGES OF U.S. HOME CORPORATION: INTEREST EXPENSE, NET 2,483 1,453 537 692 1,507 461 309 PREVIOUSLY CAPITALIZED INTEREST CHARGED TO COST OF SALES 23,338 22,342 28,871 27,555 30,786 6,629 7,881 PORTION OF RENT EXPENSE REPRESENTATIVE OF THE INTEREST FACTOR 1,381 1,562 1,820 1,833 1,941 451 557 FIXED CHARGES OF JOINT VENTURES (PRINCIPALLY INTEREST) 355 97 183 238 1,129 30 46 -------- -------- -------- -------- -------- -------- -------- EARNINGS AS ADJUSTED $ 56,906 $ 70,094 $ 83,937 $ 89,390 $ 91,264 $ 22,247 $ 24,893 ======== ======== ======== ======== ======== ======== ======== FIXED CHARGES, AS ADJUSTED, OF U.S. HOME CORPORATION: TOTAL INTEREST PAID OR ACCRUED $ 15,693 $ 23,373 $ 31,357 $ 32,687 $ 34,991 $ 8,400 $ 8,884 PORTION OF RENT EXPENSE AS ABOVE 1,381 1,562 1,820 1,833 1,941 451 557 FIXED CHARGES OF JOINT VENTURES 376 239 227 269 472 90 123 -------- -------- -------- -------- -------- -------- -------- $ 17,450 $ 25,174 $ 33,404 $ 34,789 $ 37,404 $ 8,941 $ 8,564 ======== ======== ======== ======== ======== ======== ======== RATIO OF EARNINGS TO FIXED CHARGES 3.26 2.78 2.51 2.57 2.44 2.49 2.60 ======== ======== ======== ======== ======== ======== ========
EX-23.1 7 CONSENT OF ARTHUR ANDERSON LLP 1 Exhibit 23.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in this registration statement of our report dated February 12, 1997 included in U.S. Home Corporation's Annual Report on Form 10-K for the year ended December 31, 1996, and to all references to our firm included in this registration statement. /s/ Arthur Andersen LLP ARTHUR ANDERSEN LLP Houston, Texas July 14, 1997 EX-25.1 8 STATEMENT OF ELIGIBILITY 1 EXHIBIT 25-1 REGISTRATION NO. 33-____ - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 ----------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED, OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305 (b)(2) IBJ SCHRODER BANK & TRUST COMPANY (EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER) New York 13-5375195 (State of Incorporation (I.R.S. Employer if not a U.S. national bank) Identification No.) One State Street, New York, New York 10004 (Address of principal executive offices) (Zip code) Max Volmar, Vice President IBJ Schroder Bank & Trust Company One State Street New York, New York 10004 (212) 858-2000 (Name, Address and Telephone Number of Agent for Service) U.S. HOME CORPORATION (Exact name of obligor as specified in its charter) Delaware 21-0718930 (State or jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1800 West Loop South Houston, Texas 77027 (Address of principal executive office) (Zip code) Senior Debt Securities to be registered under U.S. Home Corporation's Form S-3 under the Securities Act of 1933 to be offered on a delay or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (Title of Indenture Securities) 2 Item 1. General information Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department Two Rector Street New York, New York Federal Deposit Insurance Corporation Washington, D.C. Federal Reserve Bank of New York Second District 33 Liberty Street New York, New York (b) Whether it is authorized to exercise corporate trust powers. Yes Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. The obligor is not an affiliate of the trustee. Item 3. Voting securities of the trustee. Furnish the following information as to each class of voting securities of the trustee: As of July 14, 1997
Col. A Col. B -------------- ------------------ Title of class Amount Outstanding
Not Applicable 2 3 Item 4. Trusteeships under other indentures. If the trustee is a trustee under another indenture under which any other securities, or certificates of interest or participation in any other securities, of the obligor are outstanding, furnish the following information: (a) Title of the securities outstanding under each such other indenture 9 3/4% Senior Notes Due 2003 7.95% Senior Notes Due 2001 (b) A brief statement of the facts relied upon as a basis for the claim that no conflicting interest within the meaning of Section 310 (b) (1) of the Act arises as a result of the trusteeship under any such other indenture, including a statement as to how the indenture securities will rank as compared with the securities issued under such other indenture. Not Applicable Item 5. Interlocking directorates and similar relationships with the obligor or underwriters. If the trustee or any of the directors or executive officers of the trustee is a director, officer, partner, employee, appointee, or representative of the obligor or of any underwriter for the obligor, identify each such person having any such connection and state the nature of each such connection. Not Applicable Item 6. Voting securities of the trustee owned by the obligor or its officials. Furnish the following information as to the voting securities of the trustee owned beneficially by the obligor and each director, partner, and executive officer of the obligor: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ------------ ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially securities represented by amount given in Col. C
Not Applicable Item 7. Voting securities of the trustee owned by underwriters or their officials. 3 4 Furnish the following information as to the voting securities of the trustee owned beneficially by each underwriter for the obligor and each director, partner and executive officer of each such underwriter: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ------------ ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially securities represented by amount given in Col. C
Not Applicable Item 8. Securities of the obligor owned or held by the trustee Furnish the following information as to securities of the obligor owned beneficially or held as collateral security for obligations in default by the trustee: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ---------------------- ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable Item 9. Securities of underwriters owned or held by the trustee. If the trustee owns beneficially or holds as collateral security for obligations in default any securities of an underwriter for the obligor, furnish the following information as to each class of securities of such 4 5 underwriter any of which are so owned or held by the trustee: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ---------------------- ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable Item 10. Ownership or holdings by the trustee of voting securities of certain affiliates or securityholders of the obligor. If the trustee owns beneficially or holds as collateral security for obligations in default voting securities of a person who, to the knowledge of the trustee (1) owns 10 percent or more of the voting securities of the obligor or (2) is an affiliate, other than a subsidiary, of the obligor, furnish the following information as to the voting securities of such person:
Col A Col. B Col. C Col. D - ------------- -------------- ---------------------- ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable 5 6 Item 11. Ownership or holdings by the trustee of any securities of a person owning 50 percent or more of the voting securities of the obligor. If the trustee owns beneficially or holds as collateral security for obligations in default any securities of a person who, to the knowledge of the trustee, owns 50 percent or more of the voting securities of the obligor, furnish the following information as to each class of securities of such any of which are so owned or held by the trustee: As of July 14, 1997
Col. A Col. B Col. C - ---------------------- ------------------ -------- Nature of Indebtedness Amount Outstanding Date Due
Not Applicable Item 12. Indebtedness of the Obligor to the Trustee. Except as noted in the instructions, if the obligor is indebted to the trustee, furnish the following information: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ---------------------- ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable Item 13. Defaults by the Obligor. (a) State whether there is or has been a default with respect to the securities under this indenture. Explain the nature of any such default. Not Applicable (b) If the trustee is a trustee under another indenture under which any other securities, or certificates of interest or participation in any other securities, of the obligor are outstanding, or is trustee for more than one outstanding series of securities under the indenture, state whether there has been a default under any such indenture or series, identify the indenture or series affected, and explain the nature of any such default. 6 7 Not Applicable Item 14. Affiliations with the Underwriters If any underwriter is an affiliate of the trustee, describe each such affiliation. Not Applicable Item 15. Foreign Trustees. Identify the order or rule pursuant to which the foreign trustee is authorized to act as sole trustee under indentures qualified or to be qualified under the Act. Not Applicable Item 16. List of Exhibits. List below all exhibits filed as part of this statement of eligibility. *1. A copy of the Charter of IBJ Schroder Bank & Trust Company as amended to date. (See Exhibit 1A to Form T-1, Securities and Exchange Commission File No. 22-18460). *2. A copy of the Certificate of Authority of the Trustee to Commence Business (Included in Exhibit I above). *3. A copy of the Authorization of the Trustee, as amended to date (See Exhibit 4 to Form T-1, Securities and Exchange Commission File No. 22-19146). *4. A copy of the existing By-Laws of the Trustee, as amended to date (See Exhibit 4 to Form T-1, Securities and Exchange Commission File No. 22-19146). 7 8 5. A copy of each Indenture referred to in Item 4, if the Obligor is in default. Not Applicable. 6. The consent of the United States institutional trustee required by Section 321(b) of the Act. 7. A copy of the latest report of condition of the trustee published pursuant to law or the requirements of its supervising or examining authority. * The Exhibits thus designated are incorporated herein by reference as exhibits hereto. Following the description of such Exhibits is a reference to the copy of the Exhibit heretofore filed with the Securities and Exchange Commission, to which there have been no amendments or changes. NOTE In answering any item in this Statement of Eligibility which relates to matters peculiarly within the knowledge of the obligor and its directors or officers, the trustee has relied upon information furnished to it by the obligor. Inasmuch as this Form T-1 is filed prior to the ascertainment by the trustee of all facts on which to base responsive answers to Item 2, the answer to said Item are based on incomplete information. Item 2, may, however, be considered as correct unless amended by an amendment to this Form T-1. Pursuant to General Instruction B, the trustee has responded to Items 1, 2 and 16 of this form since to the best knowledge of the trustee as indicated in Item 13, the obligor is not in default under any indenture under which the applicant is trustee. 8 9 SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the trustee, IBJ Schroder Bank & Trust Company, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility & qualification to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York, and State of New York, on the 14th day of July, 1997. IBJ SCHRODER BANK & TRUST COMPANY By: /s/Max Volmar ------------------------------- Max Volmar Vice President 10 EXHIBIT 6 CONSENT OF TRUSTEE Pursuant to the requirements of Section 321(b) of the Trust Indenture Act of 1939, as amended, in connection with the proposed issue of Debt Securities of U.S. Home Corporation, we hereby consent that reports of examinations by Federal, State, Territorial, or District authorities may be furnished by such authorities to the Securities and Exchange Commission upon request therefor. IBJ SCHRODER BANK & TRUST COMPANY By: /s/Max Volmar ------------------------------- Max Volmar Vice President Dated: July 14, 1997 11 EXHIBIT 7 CONSOLIDATED REPORT OF CONDITION OF IBJ SCHRODER BANK & TRUST COMPANY OF NEW YORK, NEW YORK AND FOREIGN AND DOMESTIC SUBSIDIARIES REPORT AS OF MARCH 31, 1997
DOLLAR AMOUNTS IN THOUSANDS ------------ ASSETS Cash and balance due from depository institutions: Noninterest-bearing balances and currency and coin ..........................................................$ 37,521 Interest-bearing balances......................................................................................$ 325,073 Securities: Held-to-maturity securities.........................................................................$ 177,447 Available-for-sale securities.......................................................................$ 47,358 Federal funds sold and securities purchased under agreements to resell in domestic offices of the bank and of its Edge and Agreement subsidiaries and in IBFs: Federal Funds sold and Securities purchased under agreements to resell.........................................$ 75,273 Loans and lease financing receivables: Loans and leases, net of unearned income.....................................................$1,820,213 LESS: Allowance for loan and lease losses....................................................$ 58,785 LESS: Allocated transfer risk reserve........................................................$ -0- Loans and leases, net of unearned income, allowance, and reserve...............................................$1,761,428 Trading assets held in trading accounts............................................................................$ 602 Premises and fixed assets (including capitalized leases)...........................................................$ 3,817 Other real estate owned............................................................................................$ 202 Investments in unconsolidated subsidiaries and associated companies................................................$ -0- Customers' liability to this bank on acceptances outstanding.......................................................$ 310 Intangible assets..................................................................................................$ -0- Other assets.......................................................................................................$ 74,528 TOTAL ASSETS.......................................................................................................$2,503,559
12 LIABILITIES Deposits: In domestic offices............................................................................................$ 792,944 Noninterest-bearing .......................................................................$ 260,196 Interest-bearing ..........................................................................$ 394,562 In foreign offices, Edge and Agreement subsidiaries, and IBFs..................................................$1,149,176 Noninterest-bearing .......................................................................$ 13,875 Interest-bearing ......................................................................... $1,135,301 Federal funds purchased and securities sold under agreements to repurchase in domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs: Federal Funds purchased and Securities sold under agreements to repurchase.....................................$ 344,500 Demand notes issued to the U.S. Treasury...........................................................................$ 30,000 Trading Liabilities................................................................................................$ 178 Other borrowed money: a) With a remaining maturity of one year or less...............................................................$ 23,037 b) With a remaining maturity of more than one year.............................................................$ 4,958 Mortgage indebtedness and obligations under capitalized leases.....................................................$ -0- Bank's liability on acceptances executed and outstanding...........................................................$ 310 Subordinated notes and debentures..................................................................................$ -0- Other liabilities..................................................................................................$ 71,245 TOTAL LIABILITIES..................................................................................................$2,278,162 Limited-life preferred stock and related surplus...................................................................$ -0- EQUITY CAPITAL Perpetual preferred stock and related surplus......................................................................$ -0- Common stock.......................................................................................................$ 29,649 Surplus (exclude all surplus related to preferred stock)...........................................................$ 217,008 Undivided profits and capital reserves.............................................................................$ (21,223) Net unrealized gains (losses) on available-for-sale securities.....................................................$ 37 Cumulative foreign currency translation adjustments................................................................$ -0- TOTAL EQUITY CAPITAL...............................................................................................$ 225,397 TOTAL LIABILITIES AND EQUITY CAPITAL...............................................................................$2,503,559
EX-25.2 9 STATEMENT OF ELIGIBILITY 1 EXHIBIT 25-2 REGISTRATION NO. 33-____ - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 ----------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED, OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305 (b)(2) IBJ SCHRODER BANK & TRUST COMPANY (EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER) New York 13-5375195 (State of Incorporation (I.R.S. Employer if not a U.S. national bank) Identification No.) One State Street, New York, New York 10004 (Address of principal executive offices) (Zip code) Max Volmar, Vice President IBJ Schroder Bank & Trust Company One State Street New York, New York 10004 (212) 858-2000 (Name, Address and Telephone Number of Agent for Service) U.S. HOME CORPORATION (Exact name of obligor as specified in its charter) Delaware 21-0718930 (State or jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1800 West Loop South Houston, Texas 77027 (Address of principal executive office) (Zip code) Senior Debt Securities to be registered under U.S. Home Corporation's Form S-3 under the Securities Act of 1933 to be offered on a delay or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (Title of Indenture Securities) 2 Item 1. General information Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department Two Rector Street New York, New York Federal Deposit Insurance Corporation Washington, D.C. Federal Reserve Bank of New York Second District 33 Liberty Street New York, New York (b) Whether it is authorized to exercise corporate trust powers. Yes Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. The obligor is not an affiliate of the trustee. Item 3. Voting securities of the trustee. Furnish the following information as to each class of voting securities of the trustee: As of July 14, 1997
Col. A Col. B -------------- ------------------ Title of class Amount Outstanding
Not Applicable 2 3 Item 4. Trusteeships under other indentures. If the trustee is a trustee under another indenture under which any other securities, or certificates of interest or participation in any other securities, of the obligor are outstanding, furnish the following information: (a) Title of the securities outstanding under each such other indenture 9 3/4% Senior Notes Due 2003 7.95% Senior Notes Due 2001 (b) A brief statement of the facts relied upon as a basis for the claim that no conflicting interest within the meaning of Section 310 (b) (1) of the Act arises as a result of the trusteeship under any such other indenture, including a statement as to how the indenture securities will rank as compared with the securities issued under such other indenture. Not Applicable Item 5. Interlocking directorates and similar relationships with the obligor or underwriters. If the trustee or any of the directors or executive officers of the trustee is a director, officer, partner, employee, appointee, or representative of the obligor or of any underwriter for the obligor, identify each such person having any such connection and state the nature of each such connection. Not Applicable Item 6. Voting securities of the trustee owned by the obligor or its officials. Furnish the following information as to the voting securities of the trustee owned beneficially by the obligor and each director, partner, and executive officer of the obligor: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ------------ ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially securities represented by amount given in Col. C
Not Applicable Item 7. Voting securities of the trustee owned by underwriters or their officials. 3 4 Furnish the following information as to the voting securities of the trustee owned beneficially by each underwriter for the obligor and each director, partner and executive officer of each such underwriter: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ------------ ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially securities represented by amount given in Col. C
Not Applicable Item 8. Securities of the obligor owned or held by the trustee Furnish the following information as to securities of the obligor owned beneficially or held as collateral security for obligations in default by the trustee: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ---------------------- ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable Item 9. Securities of underwriters owned or held by the trustee. If the trustee owns beneficially or holds as collateral security for obligations in default any securities of an underwriter for the obligor, furnish the following information as to each class of securities of such 4 5 underwriter any of which are so owned or held by the trustee: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ------------ ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable Item 10. Ownership or holdings by the trustee of voting securities of certain affiliates or securityholders of the obligor. If the trustee owns beneficially or holds as collateral security for obligations in default voting securities of a person who, to the knowledge of the trustee (1) owns 10 percent or more of the voting securities of the obligor or (2) is an affiliate, other than a subsidiary, of the obligor, furnish the following information as to the voting securities of such person:
Col A Col. B Col. C Col. D - ------------- -------------- ---------------------- ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable 5 6 Item 11. Ownership or holdings by the trustee of any securities of a person owning 50 percent or more of the voting securities of the obligor. If the trustee owns beneficially or holds as collateral security for obligations in default any securities of a person who, to the knowledge of the trustee, owns 50 percent or more of the voting securities of the obligor, furnish the following information as to each class of securities of such any of which are so owned or held by the trustee: As of July 14, 1997
Col. A Col. B Col. C - ---------------------- ------------------ -------- Nature of Indebtedness Amount Outstanding Date Due
Not Applicable Item 12. Indebtedness of the Obligor to the Trustee. Except as noted in the instructions, if the obligor is indebted to the trustee, furnish the following information: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ---------------------- ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable Item 13. Defaults by the Obligor. (a) State whether there is or has been a default with respect to the securities under this indenture. Explain the nature of any such default. Not Applicable (b) If the trustee is a trustee under another indenture under which any other securities, or certificates of interest or participation in any other securities, of the obligor are outstanding, or is trustee for more than one outstanding series of securities under the indenture, state whether there has been a default under any such indenture or series, identify the indenture or series affected, and explain the nature of any such default. 6 7 Not Applicable Item 14. Affiliations with the Underwriters If any underwriter is an affiliate of the trustee, describe each such affiliation. Not Applicable Item 15. Foreign Trustees. Identify the order or rule pursuant to which the foreign trustee is authorized to act as sole trustee under indentures qualified or to be qualified under the Act. Not Applicable Item 16. List of Exhibits. List below all exhibits filed as part of this statement of eligibility. *1. A copy of the Charter of IBJ Schroder Bank & Trust Company as amended to date. (See Exhibit 1A to Form T-1, Securities and Exchange Commission File No. 22-18460). *2. A copy of the Certificate of Authority of the Trustee to Commence Business (Included in Exhibit I above). *3. A copy of the Authorization of the Trustee, as amended to date (See Exhibit 4 to Form T-1, Securities and Exchange Commission File No. 22-19146). *4. A copy of the existing By-Laws of the Trustee, as amended to date (See Exhibit 4 to Form T-1, Securities and Exchange Commission File No. 22-19146). 7 8 5. A copy of each Indenture referred to in Item 4, if the Obligor is in default. Not Applicable. 6. The consent of the United States institutional trustee required by Section 321(b) of the Act. 7. A copy of the latest report of condition of the trustee published pursuant to law or the requirements of its supervising or examining authority. * The Exhibits thus designated are incorporated herein by reference as exhibits hereto. Following the description of such Exhibits is a reference to the copy of the Exhibit heretofore filed with the Securities and Exchange Commission, to which there have been no amendments or changes. NOTE In answering any item in this Statement of Eligibility which relates to matters peculiarly within the knowledge of the obligor and its directors or officers, the trustee has relied upon information furnished to it by the obligor. Inasmuch as this Form T-1 is filed prior to the ascertainment by the trustee of all facts on which to base responsive answers to Item 2, the answer to said Item are based on incomplete information. Item 2, may, however, be considered as correct unless amended by an amendment to this Form T-1. Pursuant to General Instruction B, the trustee has responded to Items 1, 2 and 16 of this form since to the best knowledge of the trustee as indicated in Item 13, the obligor is not in default under any indenture under which the applicant is trustee. 8 9 SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the trustee, IBJ Schroder Bank & Trust Company, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility & qualification to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York, and State of New York, on the 14th day of July, 1997. IBJ SCHRODER BANK & TRUST COMPANY By: /s/Max Volmar ------------------------------- Max Volmar Vice President 10 EXHIBIT 6 CONSENT OF TRUSTEE Pursuant to the requirements of Section 321(b) of the Trust Indenture Act of 1939, as amended, in connection with the proposed issue of Debt Securities of U.S. Home Corporation, we hereby consent that reports of examinations by Federal, State, Territorial, or District authorities may be furnished by such authorities to the Securities and Exchange Commission upon request therefor. IBJ SCHRODER BANK & TRUST COMPANY By: /s/Max Volmar ------------------------------- Max Volmar Vice President Dated: July 14, 1997 11 EXHIBIT 7 CONSOLIDATED REPORT OF CONDITION OF IBJ SCHRODER BANK & TRUST COMPANY OF NEW YORK, NEW YORK AND FOREIGN AND DOMESTIC SUBSIDIARIES REPORT AS OF MARCH 31, 1997
DOLLAR AMOUNTS IN THOUSANDS ------------ ASSETS Cash and balance due from depository institutions: Noninterest-bearing balances and currency and coin ..........................................................$ 37,521 Interest-bearing balances......................................................................................$ 325,073 Securities: Held-to-maturity securities.........................................................................$ 177,447 Available-for-sale securities.......................................................................$ 47,358 Federal funds sold and securities purchased under agreements to resell in domestic offices of the bank and of its Edge and Agreement subsidiaries and in IBFs: Federal Funds sold and Securities purchased under agreements to resell.........................................$ 75,273 Loans and lease financing receivables: Loans and leases, net of unearned income.....................................................$1,820,213 LESS: Allowance for loan and lease losses....................................................$ 58,785 LESS: Allocated transfer risk reserve........................................................$ -0- Loans and leases, net of unearned income, allowance, and reserve...............................................$1,761,428 Trading assets held in trading accounts............................................................................$ 602 Premises and fixed assets (including capitalized leases)...........................................................$ 3,817 Other real estate owned............................................................................................$ 202 Investments in unconsolidated subsidiaries and associated companies................................................$ -0- Customers' liability to this bank on acceptances outstanding.......................................................$ 310 Intangible assets..................................................................................................$ -0- Other assets.......................................................................................................$ 74,528 TOTAL ASSETS.......................................................................................................$2,503,559
12 LIABILITIES Deposits: In domestic offices............................................................................................$ 792,944 Noninterest-bearing .......................................................................$ 260,196 Interest-bearing ..........................................................................$ 394,562 In foreign offices, Edge and Agreement subsidiaries, and IBFs..................................................$1,149,176 Noninterest-bearing .......................................................................$ 13,875 Interest-bearing ......................................................................... $1,135,301 Federal funds purchased and securities sold under agreements to repurchase in domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs: Federal Funds purchased and Securities sold under agreements to repurchase.....................................$ 344,500 Demand notes issued to the U.S. Treasury...........................................................................$ 30,000 Trading Liabilities................................................................................................$ 178 Other borrowed money: a) With a remaining maturity of one year or less...............................................................$ 23,037 b) With a remaining maturity of more than one year.............................................................$ 4,958 Mortgage indebtedness and obligations under capitalized leases.....................................................$ -0- Bank's liability on acceptances executed and outstanding...........................................................$ 310 Subordinated notes and debentures..................................................................................$ -0- Other liabilities..................................................................................................$ 71,245 TOTAL LIABILITIES..................................................................................................$2,278,162 Limited-life preferred stock and related surplus...................................................................$ -0- EQUITY CAPITAL Perpetual preferred stock and related surplus......................................................................$ -0- Common stock.......................................................................................................$ 29,649 Surplus (exclude all surplus related to preferred stock)...........................................................$ 217,008 Undivided profits and capital reserves.............................................................................$ (21,223) Net unrealized gains (losses) on available-for-sale securities.....................................................$ 37 Cumulative foreign currency translation adjustments................................................................$ -0- TOTAL EQUITY CAPITAL...............................................................................................$ 225,397 TOTAL LIABILITIES AND EQUITY CAPITAL...............................................................................$2,503,559
EX-25.3 10 STATEMENT OF ELIGIBILITY 1 EXHIBIT 25-3 REGISTRATION NO. 33-____ - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 ----------- FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED, OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305 (b)(2) IBJ SCHRODER BANK & TRUST COMPANY (EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER) New York 13-5375195 (State of Incorporation (I.R.S. Employer if not a U.S. national bank) Identification No.) One State Street, New York, New York 10004 (Address of principal executive offices) (Zip code) Max Volmar, Vice President IBJ Schroder Bank & Trust Company One State Street New York, New York 10004 (212) 858-2000 (Name, Address and Telephone Number of Agent for Service) U.S. HOME CORPORATION (Exact name of obligor as specified in its charter) Delaware 21-0718930 (State or jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1800 West Loop South Houston, Texas 77027 (Address of principal executive office) (Zip code) Senior Debt Securities to be registered under U.S. Home Corporation's Form S-3 under the Securities Act of 1933 to be offered on a delay or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (Title of Indenture Securities) 2 Item 1. General information Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department Two Rector Street New York, New York Federal Deposit Insurance Corporation Washington, D.C. Federal Reserve Bank of New York Second District 33 Liberty Street New York, New York (b) Whether it is authorized to exercise corporate trust powers. Yes Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. The obligor is not an affiliate of the trustee. Item 3. Voting securities of the trustee. Furnish the following information as to each class of voting securities of the trustee: As of July 14, 1997
Col. A Col. B -------------- ------------------ Title of class Amount Outstanding
Not Applicable 2 3 Item 4. Trusteeships under other indentures. If the trustee is a trustee under another indenture under which any other securities, or certificates of interest or participation in any other securities, of the obligor are outstanding, furnish the following information: (a) Title of the securities outstanding under each such other indenture 9 3/4% Senior Notes Due 2003 7.95% Senior Notes Due 2001 (b) A brief statement of the facts relied upon as a basis for the claim that no conflicting interest within the meaning of Section 310 (b) (1) of the Act arises as a result of the trusteeship under any such other indenture, including a statement as to how the indenture securities will rank as compared with the securities issued under such other indenture. Not Applicable Item 5. Interlocking directorates and similar relationships with the obligor or underwriters. If the trustee or any of the directors or executive officers of the trustee is a director, officer, partner, employee, appointee, or representative of the obligor or of any underwriter for the obligor, identify each such person having any such connection and state the nature of each such connection. Not Applicable Item 6. Voting securities of the trustee owned by the obligor or its officials. Furnish the following information as to the voting securities of the trustee owned beneficially by the obligor and each director, partner, and executive officer of the obligor: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ------------ ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially securities represented by amount given in Col. C
Not Applicable Item 7. Voting securities of the trustee owned by underwriters or their officials. 3 4 Furnish the following information as to the voting securities of the trustee owned beneficially by each underwriter for the obligor and each director, partner and executive officer of each such underwriter: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ------------ ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially securities represented by amount given in Col. C
Not Applicable Item 8. Securities of the obligor owned or held by the trustee Furnish the following information as to securities of the obligor owned beneficially or held as collateral security for obligations in default by the trustee: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ---------------------- ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable Item 9. Securities of underwriters owned or held by the trustee. If the trustee owns beneficially or holds as collateral security for obligations in default any securities of an underwriter for the obligor, furnish the following information as to each class of securities of such 4 5 underwriter any of which are so owned or held by the trustee: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ------------ ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially securities represented by or held as amount given in Col. C collateral security for obligations in default
Not Applicable Item 10. Ownership or holdings by the trustee of voting securities of certain affiliates or securityholders of the obligor. If the trustee owns beneficially or holds as collateral security for obligations in default voting securities of a person who, to the knowledge of the trustee (1) owns 10 percent or more of the voting securities of the obligor or (2) is an affiliate, other than a subsidiary, of the obligor, furnish the following information as to the voting securities of such person:
Col A Col. B Col. C Col. D - ------------- -------------- ---------------------- ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable 5 6 Item 11. Ownership or holdings by the trustee of any securities of a person owning 50 percent or more of the voting securities of the obligor. If the trustee owns beneficially or holds as collateral security for obligations in default any securities of a person who, to the knowledge of the trustee, owns 50 percent or more of the voting securities of the obligor, furnish the following information as to each class of securities of such any of which are so owned or held by the trustee: As of July 14, 1997
Col. A Col. B Col. C - ---------------------- ------------------ -------- Nature of Indebtedness Amount Outstanding Date Due
Not Applicable Item 12. Indebtedness of the Obligor to the Trustee. Except as noted in the instructions, if the obligor is indebted to the trustee, furnish the following information: As of July 14, 1997
Col A Col. B Col. C Col. D - ------------- -------------- ---------------------- ------------------------- Name of Owner Title of class Amount owned Percent of voting beneficially or held as securities represented by collateral security for amount given in Col. C obligations in default
Not Applicable Item 13. Defaults by the Obligor. (a) State whether there is or has been a default with respect to the securities under this indenture. Explain the nature of any such default. Not Applicable (b) If the trustee is a trustee under another indenture under which any other securities, or certificates of interest or participation in any other securities, of the obligor are outstanding, or is trustee for more than one outstanding series of securities under the indenture, state whether there has been a default under any such indenture or series, identify the indenture or series affected, and explain the nature of any such default. 6 7 Not Applicable Item 14. Affiliations with the Underwriters If any underwriter is an affiliate of the trustee, describe each such affiliation. Not Applicable Item 15. Foreign Trustees. Identify the order or rule pursuant to which the foreign trustee is authorized to act as sole trustee under indentures qualified or to be qualified under the Act. Not Applicable Item 16. List of Exhibits. List below all exhibits filed as part of this statement of eligibility. *1. A copy of the Charter of IBJ Schroder Bank & Trust Company as amended to date. (See Exhibit 1A to Form T-1, Securities and Exchange Commission File No. 22-18460). *2. A copy of the Certificate of Authority of the Trustee to Commence Business (Included in Exhibit I above). *3. A copy of the Authorization of the Trustee, as amended to date (See Exhibit 4 to Form T-1, Securities and Exchange Commission File No. 22-19146). *4. A copy of the existing By-Laws of the Trustee, as amended to date (See Exhibit 4 to Form T-1, Securities and Exchange Commission File No. 22-19146). 7 8 5. A copy of each Indenture referred to in Item 4, if the Obligor is in default. Not Applicable. 6. The consent of the United States institutional trustee required by Section 321(b) of the Act. 7. A copy of the latest report of condition of the trustee published pursuant to law or the requirements of its supervising or examining authority. * The Exhibits thus designated are incorporated herein by reference as exhibits hereto. Following the description of such Exhibits is a reference to the copy of the Exhibit heretofore filed with the Securities and Exchange Commission, to which there have been no amendments or changes. NOTE In answering any item in this Statement of Eligibility which relates to matters peculiarly within the knowledge of the obligor and its directors or officers, the trustee has relied upon information furnished to it by the obligor. Inasmuch as this Form T-1 is filed prior to the ascertainment by the trustee of all facts on which to base responsive answers to Item 2, the answer to said Item are based on incomplete information. Item 2, may, however, be considered as correct unless amended by an amendment to this Form T-1. Pursuant to General Instruction B, the trustee has responded to Items 1, 2 and 16 of this form since to the best knowledge of the trustee as indicated in Item 13, the obligor is not in default under any indenture under which the applicant is trustee. 8 9 SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the trustee, IBJ Schroder Bank & Trust Company, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility & qualification to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York, and State of New York, on the 14th day of July, 1997. IBJ SCHRODER BANK & TRUST COMPANY By: /s/Max Volmar ------------------------------- Max Volmar Vice President 10 EXHIBIT 6 CONSENT OF TRUSTEE Pursuant to the requirements of Section 321(b) of the Trust Indenture Act of 1939, as amended, in connection with the proposed issue of Debt Securities of U.S. Home Corporation, we hereby consent that reports of examinations by Federal, State, Territorial, or District authorities may be furnished by such authorities to the Securities and Exchange Commission upon request therefor. IBJ SCHRODER BANK & TRUST COMPANY By: /s/Max Volmar ------------------------------- Max Volmar Vice President Dated: July 14, 1997 11 EXHIBIT 7 CONSOLIDATED REPORT OF CONDITION OF IBJ SCHRODER BANK & TRUST COMPANY OF NEW YORK, NEW YORK AND FOREIGN AND DOMESTIC SUBSIDIARIES REPORT AS OF MARCH 31, 1997
DOLLAR AMOUNTS IN THOUSANDS ------------ ASSETS Cash and balance due from depository institutions: Noninterest-bearing balances and currency and coin ..........................................................$ 37,521 Interest-bearing balances......................................................................................$ 325,073 Securities: Held-to-maturity securities.........................................................................$ 177,447 Available-for-sale securities.......................................................................$ 47,358 Federal funds sold and securities purchased under agreements to resell in domestic offices of the bank and of its Edge and Agreement subsidiaries and in IBFs: Federal Funds sold and Securities purchased under agreements to resell.........................................$ 75,273 Loans and lease financing receivables: Loans and leases, net of unearned income.....................................................$1,820,213 LESS: Allowance for loan and lease losses....................................................$ 58,785 LESS: Allocated transfer risk reserve........................................................$ -0- Loans and leases, net of unearned income, allowance, and reserve...............................................$1,761,428 Trading assets held in trading accounts............................................................................$ 602 Premises and fixed assets (including capitalized leases)...........................................................$ 3,817 Other real estate owned............................................................................................$ 202 Investments in unconsolidated subsidiaries and associated companies................................................$ -0- Customers' liability to this bank on acceptances outstanding.......................................................$ 310 Intangible assets..................................................................................................$ -0- Other assets.......................................................................................................$ 74,528 TOTAL ASSETS.......................................................................................................$2,503,559
12 LIABILITIES Deposits: In domestic offices............................................................................................$ 792,944 Noninterest-bearing .......................................................................$ 260,196 Interest-bearing ..........................................................................$ 394,562 In foreign offices, Edge and Agreement subsidiaries, and IBFs..................................................$1,149,176 Noninterest-bearing .......................................................................$ 13,875 Interest-bearing ......................................................................... $1,135,301 Federal funds purchased and securities sold under agreements to repurchase in domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs: Federal Funds purchased and Securities sold under agreements to repurchase.....................................$ 344,500 Demand notes issued to the U.S. Treasury...........................................................................$ 30,000 Trading Liabilities................................................................................................$ 178 Other borrowed money: a) With a remaining maturity of one year or less...............................................................$ 23,037 b) With a remaining maturity of more than one year.............................................................$ 4,958 Mortgage indebtedness and obligations under capitalized leases.....................................................$ -0- Bank's liability on acceptances executed and outstanding...........................................................$ 310 Subordinated notes and debentures..................................................................................$ -0- Other liabilities..................................................................................................$ 71,245 TOTAL LIABILITIES..................................................................................................$2,278,162 Limited-life preferred stock and related surplus...................................................................$ -0- EQUITY CAPITAL Perpetual preferred stock and related surplus......................................................................$ -0- Common stock.......................................................................................................$ 29,649 Surplus (exclude all surplus related to preferred stock)...........................................................$ 217,008 Undivided profits and capital reserves.............................................................................$ (21,223) Net unrealized gains (losses) on available-for-sale securities.....................................................$ 37 Cumulative foreign currency translation adjustments................................................................$ -0- TOTAL EQUITY CAPITAL...............................................................................................$ 225,397 TOTAL LIABILITIES AND EQUITY CAPITAL...............................................................................$2,503,559
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