-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, ZKSt0p8tUrO8D2Fn4tPl/gKJrJ6cyOPImCv5b4txxwviUj9rodEHHgOrSOYBX7QW CW6RfNxC1KsZG8wDwcFAkw== 0000950123-95-001248.txt : 19950508 0000950123-95-001248.hdr.sgml : 19950508 ACCESSION NUMBER: 0000950123-95-001248 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 19 FILED AS OF DATE: 19950505 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHUBB CORP CENTRAL INDEX KEY: 0000020171 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 132595722 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 033-59111 FILM NUMBER: 95534706 BUSINESS ADDRESS: STREET 1: 15 MOUNTAIN VIEW RD P O BOX 1615 CITY: WARREN STATE: NJ ZIP: 07061 BUSINESS PHONE: 9805802000 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHUBB CAPITAL CORP CENTRAL INDEX KEY: 0000857052 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 133339467 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 033-59111-01 FILM NUMBER: 95534707 BUSINESS ADDRESS: STREET 1: 15 MOUNTAIN VIEW RD P.O BOX 1615 CITY: WARREN STATE: NJ ZIP: 07061-1615 BUSINESS PHONE: 2015802000 S-3 1 FORM S-3 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 5, 1995 REGISTRATION NO. 33- ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 _______________________ FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 _______________________ THE CHUBB CORPORATION (EXACT NAME OF REGISTRANT AND GUARANTOR AS SPECIFIED IN ITS CHARTER) NEW JERSEY 13-2595722 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
15 MOUNTAIN VIEW ROAD, P.O. BOX 1615, WARREN, NEW JERSEY 07061-1615 (908) 903-2000 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) HENRY G. GULICK, VICE PRESIDENT AND SECRETARY THE CHUBB CORPORATION 15 Mountain View Road, P.O. Box 1615, Warren, New Jersey 07061-1615 (908) 903-3561 with a copy to: FRANCIS J. MORISON DAVIS POLK & WARDWELL 450 Lexington Avenue, New York, New York 10017 Telephone (212) 450-4000 (Name, address, including zip code, and telephone number, including area code, of agent for service) _______________________ CHUBB CAPITAL CORPORATION (EXACT NAME OF REGISTRANT AND GUARANTOR AS SPECIFIED IN ITS CHARTER) NEW JERSEY 13-3339467 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
15 MOUNTAIN VIEW ROAD, P.O. BOX 1615, WARREN, NEW JERSEY 07061-1615 (908) 903-2000 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) HENRY G. GULICK, VICE PRESIDENT AND SECRETARY CHUBB CAPITAL CORPORATION 15 Mountain View Road, P.O. Box 1615, Warren, New Jersey 07061-1615 (908) 903-3561 with a copy to: FRANCIS J. MORISON DAVIS POLK & WARDWELL 450 Lexington Avenue, New York, New York 10017 Telephone (212) 450-4000 (Name, address, including zip code, and telephone number, including area code, of agent for service) Approximate date of commencement of proposed sale to public: From time to time after the effective date of this Registration Statement. 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 only in connection with dividend or interest reinvestment plans, check the following box. /x/ CALCULATION OF REGISTRATION FEE
========================================================================================================================= Amount Proposed Maximum Proposed Maximum Amount of Title of Each Class of Securities to be Aggregate Price Aggregate Registration Being Registered Registered(1) Per Unit(2) Offering Price(2) Fee ------------------------------------------------------------------------------------------------------------------------ Debt Securities, Guaranteed Debt Securities, Common Stock, Preferred Stock, Depositary Shares and Warrants . . . . . . . . . . . . $400,000,000(3) 100% $400,000,000 $137,932 ------------------------------------------------------------------------------------------------------------------------ Guarantees of Guaranteed Debt Securities . . . . . . . . -- (4) (4) None =========================================================================================================================
(1) Or, if any securities are issued at original issue discount, such greater amount as shall result in an initial aggregate offering price of $400,000,000. (2) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457 under the Securities Act of 1933. (3) Or an equivalent amount in a foreign currency or currencies. (4) No proceeds will be received by the The Chubb Corporation for the Guarantees. 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 THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. ================================================================================ 2 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 A FINAL PROSPECTUS SUPPLEMENT IS DELIVERED. 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 TERMS OF ANY SUCH STATE. SUBJECT TO COMPLETION, DATED MAY 5, 1995 PROSPECTUS [COMPANY LOGO] U.S. $400,000,000 THE CHUBB CORPORATION DEBT SECURITIES, PREFERRED STOCK AND COMMON STOCK CHUBB CAPITAL CORPORATION DEBT SECURITIES GUARANTEED TO THE EXTENT SET FORTH HEREIN BY THE CHUBB CORPORATION AND WARRANTS TO PURCHASE THE ABOVE SECURITIES _______________________ The Chubb Corporation ("Chubb") may from time to time offer, together or separately, its (i) debt securities (the "Debt Securities") which may be either senior debt securities (the "Senior Debt Securities") or subordinated debt securities (the "Subordinated Debt Securities"), (ii) shares of preferred stock (the "Preferred Stock"), which may be issued in the form of Depositary Shares (as defined below) evidenced by Depositary Receipts (as defined below), and (iii) shares of common stock, $1.00 par value per share (the "Common Stock"). Subordinated Debt Securities or Preferred Stock may be convertible into Common Stock. Chubb Capital Corporation ("Capital," collectively with Chubb, the "Issuers") may also offer from time to time its debt securities (the "Guaranteed Debt Securities") which may be either senior debt securities (the "Guaranteed Senior Debt Securities") or subordinated debt securities (the "Guaranteed Subordinated Debt Securities"). The payment of principal of and premium, if any, and interest on the Guaranteed Debt Securities is unconditionally guaranteed by Chubb. Guaranteed Subordinated Debt Securities may be convertible into Common Stock. Chubb or Chubb Capital may also from time to time offer warrants for the purchase of the above-mentioned securities (the "Warrants"), in amounts, at prices and on terms to be determined at the time of the offering. The Debt Securities, Preferred Stock, Common Stock, Guaranteed Debt Securities and Warrants are collectively called the "Securities." The Securities offered pursuant to this Prospectus may be issued in one or more series or issuances and will be limited to the initial public offering price of $400,000,000 (or its equivalent in one or more foreign currencies, currency units or composite currencies). Specific terms of the securities in respect of which this Prospectus is being delivered ("Offered Securities") will be set forth in an accompanying Prospectus Supplement ("Prospectus Supplement"), together with the terms of the offering of the Offered Securities, the initial price thereof and the net proceeds from the sale thereof. The Prospectus Supplement will set forth with regard to the particular Offered Securities, without limitation, the following: (i) in the case of Debt Securities or Guaranteed Debt Securities, whether the Debt Securities or Guaranteed Debt Securities are senior debt securities or subordinated debt securities, the specific designation, aggregate principal amount, authorized denomination, maturity, rate (which may be fixed or variable) or method of calculation of interest and dates for payment thereof, and any exchangeability, conversion, redemption, prepayment or sinking fund provisions and any listing on a securities exchange, (ii) in the case of Preferred Stock, the designation, number of shares or fractional interests therein, liquidation preference per security, initial public offering price, dividend rate (or method of calculation thereof), dates on which dividends shall be payable and dates from which dividends shall accrue, any voting rights, any redemption, conversion or exchange provisions, any other rights, preferences, privileges, limitations, and restrictions relating to the Preferred Stock, and any listing on a securities exchange and (iii) in the case of Warrants, the duration, purchase price, exercise price and detachability of such Warrants and a description of the securities for which each Warrant is exercisable. Chubb's Common Stock is listed on the New York Stock Exchange under the trading symbol "CB." Unless otherwise specified in a Prospectus Supplement, the Senior Debt Securities or Guaranteed Senior Debt Securities, when issued, will be unsecured and will rank equally with all other unsecured and unsubordinated indebtedness of Chubb or Capital, respectively. The Subordinated Debt Securities or Guaranteed Subordinated Debt Securities, when issued, will be subordinated in right of payment to all Senior Indebtedness (as defined below) of Chubb or Capital, respectively. The Offered Securities may be offered directly, through agents designated from time to time, through dealers or through underwriters. Such agents or underwriters may act alone or with other agents or underwriters. See "Plan of Distribution." Any such agents, dealers or underwriters will be set forth in a Prospectus Supplement. If an agent of Chubb or Capital, as the case may be, or a dealer or underwriter is involved in the offering of the Offered Securities, the agent's commission, dealer's purchase price, underwriter's discount and net proceeds to Chubb or Capital, as the case may be, will be set forth in, or may be calculated from, the Prospectus Supplement. Any underwriters, dealers or agents participating in the offering may be deemed "underwriters" within the meaning of the Securities Act of 1933. This Prospectus may not be used to consummate sales of Offered Securities unless accompanied by a Prospectus Supplement. _______________________ 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 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 _______ __, 1995. 3 IN CONNECTION WITH AN OFFERING, THE UNDERWRITERS FOR SUCH OFFERING MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE OFFERED SECURITIES AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. 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 Chubb, Capital 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 nor any sale made thereunder shall, under any circumstances, create any implication that the information therein is correct as of any time subsequent to the date thereof. _______________________ AVAILABLE INFORMATION Chubb 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 statements and other information with the Securities and Exchange Commission (the "Commission"). The registration statement of which this Prospectus forms a part, as well as reports, proxy statements and other information filed by Chubb, may be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, 7 World Trade Center, New York, New York 10048; and Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material can be obtained at prescribed rates from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. Chubb's Common Stock is listed on the New York Stock Exchange and reports and other information herein and therein concerning Chubb can also be inspected at the office of the New York Stock Exchange, 20 Broad Street, New York, New York 10005. This Prospectus constitutes a part of Registration Statement on Form S-3 (together with all amendments and exhibits thereto, the "Registration Statement") filed with the Commission under the Securities Act of 1933 (the "Securities Act") with respect to the Offered Securities. This Prospectus does not contain all of the information set forth in such Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the Commission. Reference is made to such Registration Statement and to the exhibits relating thereto for further information with respect to Chubb and Capital and the Offered Securities. Any statements contained herein concerning the provisions of any document filed as an exhibit to the Registration Statement or otherwise filed with the Commission or incorporated by reference herein are not necessarily complete, and in each instance reference is made to the copy of such document so filed for a more complete description of the matter involved. Each such statement is qualified in its entirety by such reference. 2 4 INCORPORATION OF CERTAIN INFORMATION BY REFERENCE The Annual Report on Form 10-K of Chubb for the year ended December 31, 1994, which has been filed with the Commission, is hereby incorporated by reference. All documents filed by Chubb after the date of this Prospectus pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the termination of the offering of the Offered Securities offered hereby, shall be deemed to be incorporated herein by reference and to be a part hereof from the date of such documents. Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statements as modified or superseded shall be deemed, except as so modified or superseded, to constitute a part of this Prospectus. Chubb will provide without charge to each person to whom a copy of this Prospectus is delivered, upon written or oral request of such person, a copy of any or all of the documents referred to above which have been or may be incorporated by reference in this Prospectus (other than certain exhibits to such documents). Requests for such documents should be directed to The Chubb Corporation, 15 Mountain View Road, P.O. Box 1615, Warren, New Jersey 07061-1615, Attention: Corporate Secretary (Telephone: (908) 903-3579). THE ISSUERS Chubb, organized in 1967 as a New Jersey corporation, is a holding company primarily engaged, through subsidiaries, in the businesses of property and casualty insurance, life and health insurance and real estate development. Chubb traces its history back to the formation in 1882 of Chubb & Son, an underwriter and manager of insurance companies, and the founding in 1901 of its principal property and casualty insurance subsidiary, Federal Insurance Company. Since its founding as a specialized manager of marine insurance, Chubb's property and casualty business has expanded to include most forms of property and casualty coverages. Chubb's life and health insurance subsidiaries market insurance protection and investment products to individuals and groups. Chubb's real estate subsidiaries develop commercial and residential properties. Chubb is a holding company whose primary source of funds for the payment of interest on its obligations or dividends to its stockholders is dividends from its subsidiaries. The amount of dividend distributions to Chubb from its insurance subsidiaries may be restricted by state insurance laws and regulations as administered by state insurance departments. Chubb's principal executive office is located at 15 Mountain View Road, P.O. Box 1615, Warren, New Jersey 07061-1615, and its telephone number is (908) 903-2000. Capital, organized in 1986 as a New Jersey corporation, is engaged in the business of borrowing by issuing unsecured securities and lending money to Chubb and affiliates of Chubb. Capital's principal executive office is located at 15 Mountain View Road, P.O. Box 1615, Warren, New Jersey 07061-1615, and its telephone number is (908) 903-2000. 3 5 RATIO OF CONSOLIDATED EARNINGS TO FIXED CHARGES OF CHUBB
YEARS ENDED DECEMBER 31, -------------------------------------- 1994 1993 1992 1991 1990 ---- ---- ---- ---- ---- Ratio of Consolidated Earnings to Fixed Charges . . . . . . . 5.88 3.59 6.68 6.36 6.36
For the purpose of computing the above ratios of consolidated earnings to fixed charges, earnings consist of income before income taxes and the cumulative effect of changes in accounting principles plus fixed charges, net of capitalized interest. Fixed charges consist of interest expense before reduction for capitalized interest and the portion of rental expense (net of rental income from subleased properties), which is considered to be representative of the interest factors in the leases. No preferred stock of Chubb was outstanding during the periods indicated. USE OF PROCEEDS Proceeds from the sale of Debt Securities, Preferred Stock, Common Stock and Warrants will be used by Chubb for general corporate purposes. All or a substantial portion of the proceeds from the sale of Guaranteed Debt Securities will be lent by Capital to Chubb or its affiliates, and Chubb or such affiliate will use such proceeds for general corporate purposes. Proceeds from the sale of Securities initially may be temporarily invested in short-term securities. DESCRIPTION OF THE INDENTURES, THE DEBT SECURITIES AND THE GUARANTEED DEBT SECURITIES The Debt Securities are to be issued under (i) in the case of the Senior Debt Securities, an indenture (the "Senior Indenture"), dated as of October 25, 1989, between Chubb and The First National Bank of Chicago, as trustee (the "Trustee"), or (ii) in the case of the Subordinated Debt Securities, an indenture (the "Subordinated Indenture"), to be executed by Chubb and the Trustee. The Guaranteed Debt Securities are to be issued under (i) in the case of the Guaranteed Senior Debt Securities, an indenture (the "Senior Capital Indenture"), dated as of October 25, 1989, between Capital, Chubb, as guarantor, and the Trustee, or (ii) in the case of the Guaranteed Subordinated Debt Securities, an indenture (the "Subordinated Capital Indenture") to be executed by Capital, Chubb, as guarantor, and the Trustee. Copies of the Senior Indenture, the Subordinated Indenture, the Senior Capital Indenture and the Subordinated Capital Indenture (each an "Indenture," collectively the "Indentures") have been filed as exhibits to the Registration Statement of which this Prospectus forms a part. The terms of each Indenture are the same in all material respects, except as described below. The following is a summary of certain provisions of each Indenture and does not purport to be complete. Reference is made to each Indenture for a complete statement of such provisions. Certain capitalized terms used below are defined in each Indenture and have the meanings given them in each Indenture. Section references are to each Indenture. Wherever particular sections or defined terms of each Indenture are referred to, such sections or defined terms are incorporated by reference as part of the statements made, and the statement is qualified in its entirety by such reference. 4 6 The Prospectus Supplement will contain any additional or revised information with respect to the senior and subordinated debt outstanding as of the date of the Prospectus Supplement. TERMS APPLICABLE TO BOTH THE DEBT SECURITIES AND THE GUARANTEED DEBT SECURITIES GENERAL None of the Indentures limit the amount of debentures, notes or other evidences of indebtedness which may be issued thereunder. Each Indenture provides that Debt Securities or Guaranteed Debt Securities, as the case may be, may be issued from time to time in one or more series and may be denominated and payable in foreign currencies or units based on or relating to foreign currencies, including European Currency Units ("ECUs"). Special United States federal income tax considerations applicable to any Debt Securities or Guaranteed Debt Securities, as the case may be, so denominated will be described in the relevant Prospectus Supplement. The Debt Securities issued under the Senior Indenture will be unsecured obligations of Chubb. The Guaranteed Debt Securities issued under the Senior Capital Indenture will be unsecured obligations of Capital. The Debt Securities issued under the Subordinated Indenture will be subordinate and junior in right of payment to the extent and in the manner set forth in the Subordinated Indenture to all Senior Indebtedness of Chubb. The Guaranteed Debt Securities issued under the Subordinated Capital Indenture will be subordinate and junior in right of payment to the extent and in the manner set forth in the Subordinated Capital Indenture to all Senior Indebtedness of Capital (see "Subordination"). Reference is made to the Prospectus Supplement for the following terms of the Debt Securities or Guaranteed Debt Securities, as the case may be, (to the extent such terms are applicable to such Debt Securities or Guaranteed Debt Securities and are not set forth herein) offered pursuant thereto (the "Offered Debt Securities"): (i) whether the Offered Debt Securities will be Debt Securities issued by Chubb or Guaranteed Debt Securities issued by Capital; (ii) designation, aggregate principal amount, purchase price and denomination; (iii) currency or currency units based on or relating to currencies in which such Debt Securities or Guaranteed Debt Securities, as the case may be, are denominated and/or in which principal (and premium, if any) and/or any interest will or may be payable; (iv) the date of maturity; (v) interest rate or rates (or method by which such rate will be determined), if any; (vi) the dates on which any such interest will be payable; (vii) the place or places where the principal of and interest, if any, on the Offered Debt Securities will be payable; (viii) any redemption or sinking fund provisions; (ix) any rights of the holders of Offered Debt Securities to convert or exchange the Offered Debt Securities into other securities or property of Chubb or Capital, as the case may be; and (x) any other specific terms of the Offered Debt Securities, including any additional events of default or covenants provided for with respect to Offered Debt Securities, and any terms which may be required by or advisable under United States laws or regulations. Debt Securities or Guaranteed Debt Securities may be presented for exchange or transfer in the manner, at the places and subject to the restrictions set forth in such Debt Securities or such Guaranteed Debt Securities, as applicable, and the Prospectus Supplement. Such services will be provided without charge, other than any tax or other governmental charge payable in connection therewith, but subject to the limitations provided in the applicable Indenture. 5 7 Debt Securities or Guaranteed Debt Securities will bear interest at a fixed rate (a "Fixed Rate Security") or a floating rate (a "Floating Rate Security"). Debt Securities or Guaranteed Debt Securities bearing no interest or interest at a rate which, at the time of issuance, is below the prevailing market rate, will be sold at a discount below their stated principal amount. Special United States federal income tax considerations applicable to any such discounted Debt Securities or Guaranteed Debt Securities or to certain Debt Securities or Guaranteed Debt Securities issued at par which are treated as having been issued at a discount for United States income tax purposes will be described in the relevant Prospectus Supplement. Debt Securities or Guaranteed Debt Securities may be issued, from time to time, with the principal amount payable on any principal payment date, or the amount of interest payable on any interest payment date, to be determined by reference to one or more currency exchange rates, commodity prices, equity indices or other factors. Holders of such Debt Securities or Guaranteed Debt Securities may receive a principal amount on any principal payment date, or a payment of interest on any interest payment date, that is greater than or less than the amount of principal or interest otherwise payable on such dates, depending upon the value on such dates of the applicable currency, commodity, equity index or other factor. Information as to the methods of determining the amount of principal or interest payable on any date, the currencies, commodities, equity indices or other factors to which the amount payable on such date is linked and certain additional tax considerations will be set forth in the applicable Prospectus Supplement. None of the Indentures contain any covenant or other specific provision to afford protection to holders of the Debt Securities or Guaranteed Debt Securities in the event of a highly leveraged transaction or a change in control of Chubb or Capital, as the case may be, except to the limited extent described under "Consolidation, Merger and Sale of Assets". GUARANTEE Chubb will guarantee (each a "Guarantee") the punctual payment of the principal of, premium, if any, and interest on the Guaranteed Debt Securities, when and as the same are due and payable. Each Guarantee is absolute and unconditional, irrespective of any circumstance that might otherwise constitute a legal or equitable discharge of a surety or guarantor. Notwithstanding the foregoing, the Guarantees of the Guaranteed Subordinated Debt Securities will be subordinate and junior in right of payment to the extent and in the manner set forth in the Subordinated Indenture to all Senior Indebtedness of Chubb. To evidence the Guarantee, a guarantee, executed by Chubb, will be endorsed on each Guaranteed Debt Security. (Senior Capital Indenture and Subordinated Capital Indenture Sections 3.1, 3.2) SUBORDINATION The payment of the principal of, premium, if any, and interest on the Subordinated Debt Securities or the Guaranteed Subordinated Debt Securities, as the case may be, is subordinated in right of payment, as set forth in the Subordinated Debt Securities, Guaranteed Subordinated Debt Securities and the applicable Indenture, to the prior payment in full of all Senior Indebtedness of Chubb or Capital, as applicable, and the Guarantees are subordinated to the prior payment in full of all Senior Indebtedness of Chubb. "Senior Indebtedness" of Chubb or Capital, as the case may be, is defined as the principal of, premium, if any, and unpaid interest on the following, whether outstanding at the date of the 6 8 applicable Indenture or thereafter incurred or created: (a) indebtedness of Chubb or Capital, as the case may be, for money borrowed (including purchase-money obligations) evidenced by notes or other written obligations, (b) indebtedness of Chubb or Capital, as the case may be, evidenced by notes (other than the Offered Securities), debentures, bonds or other securities issued under the provisions of an indenture or similar instrument, (c) obligations of Chubb or Capital, as the case may be, as lessee under capitalized leases and leases of property made as part of any sale and leaseback transactions, (d) indebtedness of others of any of the kinds described in the preceding clauses (a) through (c) assumed or guaranteed by Chubb or Capital, as the case may be, and (e) renewals, extensions and refundings of, and indebtedness and obligations of a successor corporation issued in exchange for or in replacement of, indebtedness or obligations of the kinds described in the preceding clauses (a) through (d), unless in the case of any particular indebtedness, obligation, renewal, extension or refunding the instrument creating or evidencing the same or the assumption or guarantee thereof expressly provides that such indebtedness, obligation, renewal, extension or refunding is not superior in right of payment to the Subordinated Debt Securities or to the Guaranteed Subordinated Debt Securities. The applicable Indentures, the Subordinated Debt Securities and the Guaranteed Subordinated Debt Securities do not limit the amount of Senior Indebtedness that may be incurred. Information concerning the amount of Senior Indebtedness to which the Debt Securities and the Guaranteed Debt Securities would be subordinate at a then recent date will be set forth in the applicable Prospectus Supplement. (Subordinated Indenture Section 15.1; Subordinated Capital Indenture Section 16.1) No payment on account of principal of, premium, if any, or interest on the Subordinated Debt Securities or the Guaranteed Subordinated Debt Securities, as the case may be, may be made if, at the time of such payment, there exists any default with respect to any Senior Indebtedness and the default is the subject of judicial proceedings or Chubb or Capital, as the case may be, receives notice of the default from any holder of Senior Indebtedness or any trustee therefor. Upon any acceleration of the maturity of the Subordinated Debt Securities or the Guaranteed Subordinated Debt Securities, as the case may be, by reason of any Event of Default (as defined below), Chubb or Capital, as the case may be, must give notice of the acceleration to holders of the Senior Indebtedness and may not pay holders of the Subordinated Debt Securities or the Guaranteed Subordinated Debt Securities, as applicable, until 120 days after the acceleration and then only if such payment is otherwise permitted at that time. The terms of the Subordinated Indenture and the Subordinated Capital Indenture provide that neither Chubb nor Capital will issue any subordinated debt unless such debt is pari passu with the Subordinated Debt Securities or the Guaranteed Subordinated Debt Securities. In the event of any payment or distribution of assets or securities of Chubb or Capital, as the case may be, upon any dissolution, winding up, total or partial liquidation or reorganization of or similar proceeding relating to Chubb or Capital, as the case may be, all principal of, premium, if any, and interest due on all Senior Indebtedness of Chubb or Capital, as applicable, must be paid in full before the holders of the Subordinated Debt Securities or the Guaranteed Subordinated Debt Securities are entitled to receive or retain any payment. By reason of such subordination, in the event of insolvency, creditors of Chubb and/or Capital who are holders of Senior Indebtedness of Chubb or Capital, as the case may be, as well as general creditors of Chubb and/or Capital, may recover more, ratably, than the holders of the Subordinated Debt Securities or the Guaranteed Subordinated Debt Securities, as the case may be. (Subordinated Indenture Sections 15.1, 15.2, 15.3; Subordinated Capital Indenture Sections 16.1, 16.2, 16.3) 7 9 MODIFICATION AND WAIVER Modifications and amendments of any Indenture may be made by Chubb, and in the case of Indentures to which it is a party, Capital, and the Trustee, with the consent of the record holders of a majority in aggregate principal amount of the outstanding securities issued under the Indenture which are affected by the modification or amendment provided that no such modification or amendment may, without the consent of the record holder of each such security affected thereby, among other things: (a) extend the final maturity of any security, or reduce the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon, or reduce any amount payable on redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof or the amount thereof provable in bankruptcy, or change the currency of payment of principal of or interest on any security, or extend the time or reduce the amount of any payment to any sinking fund or analogous obligation relating to any security, or impair or affect the right of any security holder to institute suit for the payment thereof or, if the relevant securities provide therefor, any right of repayment at the option of the security holder (b) reduce the aforesaid percentage of securities of any series, the consent of the holders of which is required for any such supplemental indenture, or (c) reduce the percentage of securities of any series necessary to consent to waive any past default under the Indenture to less than a majority, or (d) modify any of the provisions of the sections of such Indenture relating to supplemental indentures with the consent of the holders of securities, except to increase any such percentage or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the holder of each security affected thereby, provided, however, that this clause shall not be deemed to require the consent of any holder with respect to changes in the references to "the Trustee" and concomitant changes in such section or the deletion of this proviso. (Senior Indenture and Subordinated Indenture Section 8.2; Senior Capital Indenture and Subordinated Capital Indenture Section 9.2) A supplemental indenture which changes or eliminates any covenant or other provision of any 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 the Indenture of the holders of securities of any other series. (Senior Indenture and Subordinated Indenture Section 8.2; Senior Capital Indenture and Subordinated Capital Indenture Section 9.2) Modifications and amendments of any Indenture may be made by Chubb and in the case of Indentures to which it is a party, Capital and the Trustee, without the consent of the holders of any series of securities issued thereunder: (1) to secure any securities issued thereunder; (2) to evidence the succession of another corporation to Chubb or Capital and the assumption by any such successor of the covenants, agreements and obligations of Chubb or Capital, as the case may be, in the Indenture and in the securities issued thereunder; (3) to add to the covenants of Chubb or Capital or to add any additional events of default; (4) to cure any ambiguity, to correct or supplement any provision in such Indenture that may be inconsistent with any other provision of such Indenture or to make any other provisions with respect to matters or questions arising under such Indenture, provided that such action shall not adversely affect the interests of the holders of any series of securities issued thereunder; (5) to establish the form and terms of securities issued thereunder; (6) to evidence and provide for a successor Trustee under such Indenture with respect to one or more series of securities issued thereunder or to provide for or facilitate the administration of the trusts under the Indenture by more than one trustee; (7) to permit or facilitate the issuance of securities in bearer form or to provide for uncertificated securities to be issued thereunder; or (8) to change or eliminate any provision of such Indenture, provided that any such change or 8 10 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. (Senior Indenture and Subordinated Indenture Section 8.1; Senior Capital Indenture and Subordinated Capital Indenture Section 9.1) EVENTS OF DEFAULT The following will be events of default (each an "Event of Default") under each Indenture with respect to each series of Debt Securities or Guaranteed Debt Securities: (a) failure to pay principal (or premium, if any) on any of the securities of such series outstanding under such Indenture when due; (b) failure to pay any interest on any of the securities of such series outstanding under such Indenture when due, continued for 30 days; (c) default in the payment, if any, of any sinking fund installment when due, payable by the terms of securities of such series; (d) failure to perform any other covenant of Chubb or Capital, as the case may be, contained in such Indenture continued for 60 days after written notice; and (e) certain events of bankruptcy, insolvency or reorganization of Chubb or, in the case of Guaranteed Debt Securities only, Capital. If an Event of Default shall happen and be continuing, the Trustee in its discretion may, and at the written request of record holders of a majority in aggregate principal amount of the securities of each series affected outstanding under the relevant Indenture and upon being indemnified to its satisfaction shall, proceed to protect and enforce its rights, and those of the record holders of such securities. In case an Event of Default described in (a), (b), (c) or (d) (if such Event of Default is with respect to less than all series of securities under the relevant Indenture then outstanding) above shall occur and be continuing with respect to any series of securities, the Trustee or the holders of not less than 25% in aggregate principal amount of the securities of such series then outstanding (each such series acting as a separate class) may declare the principal (or, in the case of discounted Debt Securities or discounted Guaranteed Debt Securities, the amount specified in the terms thereof) of such series to be due and payable. In case an Event of Default described in (d) (if such Event of Default is with respect to all series of securities under the relevant Indenture then outstanding) or (e) above shall occur and be continuing, the Trustee or the holders of not less than 25% in aggregate principal amount of all securities then outstanding under the relevant Indenture (treated as one class) may declare the principal (or, in the case of discounted Debt Securities or discounted Guaranteed Debt Securities, the amount specified in the terms thereof) of all outstanding securities to be due and payable. Any Event of Default with respect to a particular series of securities under the relevant Indenture may be waived by the holders of a majority in aggregate principal amount of the outstanding securities of such series (or of all the outstanding securities under the relevant Indenture, as the case may be), except in each case a failure to pay principal of or premium, if any, or interest on such security. (Senior Indenture and Subordinated Indenture Section 5.1, 5.10; Senior Capital Indenture and Subordinated Capital Indenture Section 6.2, 6.10) The Trustee may withhold notice to the holders of any default with respect to any series of securities (except in payment of principal of or interest or premium on, or sinking fund payment in respect of, the securities) if the Trustee considers it in the interest of holders to do so. (Senior Indenture and Subordinated Indenture Section 5.11; Senior Capital Indenture and Subordinated Capital Indenture Section 6.11) Each of Chubb and Capital is required to furnish to the Trustee annually a statement as to its performance or fulfillment of covenants, agreements or conditions in the Indenture and as to the absence of default. (Senior Indenture and Subordinated Indenture Section 3.5; Senior Capital Indenture and Subordinated Capital Indenture Section 4.5) 9 11 CONSOLIDATION, MERGER AND SALE OF ASSETS Chubb may not consolidate with, merge into or sell, convey or lease all or substantially all of its assets to any Person nor permit any Person to consolidate with, merge into or sell, convey or lease all or substantially all of its assets to Chubb unless Chubb is the surviving corporation or the successor Person is a corporation organized under the laws of any domestic jurisdiction and assumes Chubb's obligations on the Debt Securities, the Guarantees of the Guaranteed Debt Securities, if applicable, and under the Indentures, and after giving effect thereto no Event of Default, and no event which, after notice or lapse of time or both, would become an Event of Default shall have occurred and be continuing, and that certain other conditions are met. Senior Indenture and Subordinated Indenture Sections 9.1, 9.2; Senior Capital Indenture and Subordinated Capital Indenture Sections 10.3, 10.4) Capital may not consolidate with, merge into or sell, convey or lease all or substantially all of its assets to any Person nor permit any Person to consolidate with, merge into or sell, convey or lease all or substantially all of its assets to Capital unless Capital is the surviving corporation or the successor Person is a corporation organized under the laws of any domestic jurisdiction and assumes Capital's obligations on the Guaranteed Debt Securities and under the Senior Capital Indenture and the Subordinated Capital Indenture, and after giving effect thereto no Event of Default, and no event which, after notice or lapse of time or both, would become an Event of Default shall have occurred and be continuing, and that certain other conditions are met. (Senior Capital Indenture and Subordinated Capital Indenture Sections 10.1, 10.2) APPLICABLE LAW The Debt Securities, Guaranteed Debt Securities and each Indenture will be governed by and construed in accordance with the laws of the State of New York. (Senior Indenture and Subordinated Indenture Section 11.8; Senior Capital Indenture and Subordinated Capital Indenture Section 12.8). CONCERNING THE TRUSTEE The First National Bank of Chicago, 153 West 51 Street, New York, New York 10019, is the Trustee under the Senior Indenture and the Senior Capital Indenture and will be the Trustee under the Subordinated Indenture and the Subordinated Capital Indenture. DESCRIPTION OF THE CAPITAL STOCK GENERAL The authorized capital stock of Chubb consists of 300,000,000 shares of common stock, $1.00 par value per share (the "Common Stock"), and 4,000,000 shares of Preferred Stock, $1.00 par value (the "Preferred Stock"). As of March 31, 1995, there were issued 87,826,495 shares of Common Stock, of which 894,705 were treasury shares and 86,931,790 were outstanding, and Chubb had no Preferred Stock issued or outstanding. 10 12 The following summary of the terms of Chubb's capital stock does not purport to be complete and is qualified in its entirety by reference to the applicable provisions of New Jersey law and Chubb's Restated Certificate of Incorporation, as amended (the "Charter"). COMMON STOCK The holders of shares of Common Stock, subject to the preferential rights of the holders of any shares of Preferred Stock of Chubb, are entitled to dividends when and as declared by the Board of Directors. The holders of the Common Stock have one vote per share on all matters submitted to a vote of the shareholders, and the right to the net assets of Chubb in liquidation after payment of any amounts due to creditors and in respect of the preferred stock of Chubb. Holders of shares of Common Stock are not entitled as a matter of right to any preemptive or subscription rights and are not entitled to cumulative voting for directors. All outstanding shares of Common Stock are, and the shares of Common Stock issued hereunder upon exchange of the Debt Securities, Guaranteed Debt Securities or Preferred Stock will be, fully paid and nonassessable. Under New Jersey law and the Charter, the affirmative vote of two-thirds of the votes cast is required for shareholder approval of any merger or any plan of consolidation as well as for any sale, lease, exchange or other disposition of all, or substantially all, of the assets of Chubb, if not in the usual and regular course of its business, and for any liquidation, dissolution or amendment of the Charter. All other shareholder action is decided by a majority of the votes cast at a meeting of shareholders. The By-Laws of Chubb provide that the annual meeting of shareholders shall be held on such day in the month of April of each year as is designated by the Board of Directors and as stated in a written notice, which notice is mailed or delivered to each shareholder at least ten days prior to any shareholder meeting. The Charter and the By-Laws provide that shareholder meetings may be held in the State of New Jersey or in the City of New York, State of New York, at such place therein as may from time to time be designated by the Board of Directors. The Charter further provides that the Board of Directors has the power, except as provided by statute, in its discretion, to use or apply any funds of Chubb lawfully available therefor for the purchase or acquisition of shares of the capital stock or bonds or other securities of Chubb, in the market or otherwise, at such price as may be fixed by the Board, and to such extent and in such manner and for such purposes and upon such terms as the Board may deem expedient and as may be permitted by law. The Transfer Agent and Registrar for Chubb's Common Stock is First Chicago Trust Company of New York, P.O. Box 2500, Jersey City, New Jersey 07303-2500. PREFERRED STOCK Under the Charter, Chubb is authorized to issue up to 4,000,000 shares of Preferred Stock, in one or more series, with such designations and such relative voting, dividend, liquidation, conversion and other rights, preferences and limitations as are stated in the Charter any amendment thereto establishing such series adopted by the Board of Directors of Chubb. 11 13 Shares of Preferred Stock of Chubb may be issued in one or more series and the shares of all series will rank pari passu and be identical in all respects, except that with respect to each series the Board of Directors may fix, among other things: the rate of dividends payable thereon; the time and prices of redemption; the amount payable upon voluntary liquidation; the retirement or sinking fund, if any; the conversion rights, if any; the voting rights, if any, in addition to the voting right described below; the restrictions, if any, upon creation of indebtedness of Chubb, or any subsidiary thereof, or the issuance of stock ranking on a parity with or senior to the shares of Preferred Stock either as to dividends or upon liquidation; the restrictions, if any, on the payment of dividends upon, or on the acquisition of, the Common Stock or upon any other class or classes of stock of Chubb (other than Preferred Stock) ranking on a parity with or junior to the shares of Preferred Stock either as to dividends or upon liquidation; and the number of shares to comprise such series. Each series of Preferred Stock will be entitled to receive an amount payable upon liquidation, dissolution or winding up, fixed for each series, plus all dividends accumulated to the date of final distribution, before any payment or distribution of assets of Chubb is made on Common Stock. Shares of Preferred Stock that have been issued and reacquired in any manner by Chubb (including shares redeemed, shares purchased and retired and shares that have been converted into shares of another series or class) may be reissued as part of the same or another series of Preferred Stock. In accordance with the foregoing, the 4,000,000 authorized but unissued shares of Preferred Stock may be issued pursuant to resolution of the Board of Directors without the vote of the holders of any capital stock of Chubb. PREFERRED STOCK DEPOSITARY SHARES Chubb may, at its option, elect to offer receipts for fractional interests ("Depositary Shares") in Preferred Stock. In such event, receipts ("Depositary Receipts") for Depositary Shares, each of which will represent a fraction (to be set forth in the Prospectus Supplement relating to a particular series of Preferred Stock) of a share of a particular series of Preferred Stock, will be issued as described below. The shares of any series of Preferred Stock represented by Depositary Shares will be deposited under a deposit agreement (the "Deposit Agreement") between Chubb and the depositary named in the Prospectus Supplement relating to such shares (the "Preferred Stock Depositary"). Subject to the terms of the Deposit Agreement, each owner of a Depositary Share will be entitled, in proportion to the applicable fraction of a share of Preferred Stock represented by such Depositary Share, to all the rights and preferences of the Preferred Stock represented thereby (including dividend, voting, redemption, conversion, exchange, subscription and liquidation rights). The following summary of certain provisions of the Deposit Agreement does not purport to be complete and is subject to, and is qualified in its entirety by reference to, all the provisions of the Deposit Agreement, including the definitions therein of certain terms. Whenever particular sections of the Deposit Agreement are referred to, it is intended that such section shall be incorporated herein by reference. Copies of the forms of Deposit Agreement and Depositary Receipt are filed as exhibits to the Registration Statement of which this Prospectus is a part, and the following summary is qualified in its entirety by reference to such exhibits. The Preferred Stock Depositary will distribute to holders of Depositary Receipts all cash dividends or other cash distributions received in respect of the Preferred Stock to the record holders of Depositary Shares relating to such Preferred Stock in proportion to the numbers of such Depositary Shares owned by such holders. (Deposit Agreement Section 4.01) 12 14 In the event of a distribution other than in cash, the Preferred Stock Depositary will distribute property received by it to the record holders of Depositary Shares in an equitable manner, unless the Preferred Stock Depositary determines that it is not feasible to make such distribution, in which case the Preferred Stock Depositary may sell such property and distribute the net proceeds from such sale to such holders. (Deposit Agreement Section 4.02) Upon surrender of a Depositary Receipt at the corporate trust office of the Preferred Stock Depositary and upon payment of the taxes, charges and fees provided for in the Deposit Agreement and subject to the terms thereof, the holder of the Depositary Shares evidenced thereby is entitled to delivery at such office, to or upon his or her order, of the number of whole shares of the related series of Preferred Stock and any money or other property, if any, represented by such Depositary Shares. If a series of Preferred Stock represented by Depositary Shares is subject to redemption, the Depositary Shares will be redeemed from the proceeds received by the Preferred Stock Depositary resulting from the redemption, in whole or in part, of such series of Preferred Stock held by the Preferred Stock Depositary. The redemption price per Depositary Share will be equal to the applicable fraction of the redemption price per share payable with respect to such series of the Preferred Stock. Whenever Chubb redeems shares of Preferred Stock held by the Preferred Stock Depositary, the Preferred Stock Depositary will redeem as of the same redemption date the number of Depositary Shares representing shares of Preferred Stock so redeemed. If fewer than all the Depositary Shares are to be redeemed, the Depositary Shares to be redeemed will be selected by lot, pro rata or by any other equitable method as may be determined by the Preferred Stock Depositary. (Deposit Agreement Section 2.08) Upon receipt of notice of any meeting at which the holders of the Preferred Stock are entitled to vote, the Preferred Stock Depositary will mail the information contained in such notice of meeting to the record holders of the Depositary Shares relating to such Preferred Stock. Each record holder of such Depositary Shares on the record date (which will be the same date as the record date for the Preferred Stock) will be entitled to instruct the Preferred Stock Depositary as to the exercise of the voting rights pertaining to the amount of the Preferred Stock represented by such holder's Depositary Shares. The Preferred Stock Depositary will endeavor, insofar as practicable, to vote the amount of the Preferred Stock represented by such Depositary Shares in accordance with such instructions, and Chubb will agree to take all reasonable action which may be deemed necessary by the Preferred Stock Depositary in order to enable the Preferred Stock Depositary to do so. The Preferred Stock Depositary will abstain from voting shares of the Preferred Stock to the extent it does not receive specific instructions from the holder of Depositary Shares representing such Preferred Stock. (Deposit Agreement Section 4.05) The form of Depositary Receipt evidencing the Depositary Shares and any provision of the Deposit Agreement may at any time be amended by agreement between Chubb and the Preferred Stock Depositary. However, any amendment which materially and adversely alters the rights of the holders of Depositary Shares will not be effective unless such amendment has been approved by the holders of at least a majority of the Depositary Shares then outstanding. The Deposit Agreement will terminate only if (i) all outstanding Depositary Shares have been redeemed or (ii) there has been a final distribution in respect of the Preferred Stock in connection with any liquidation, dissolution or winding-up of Chubb and such distribution has been distributed to the holders of Depositary Receipts. (Deposit Agreement Sections 6.01, 6.02) Chubb will pay all transfer and other taxes and governmental charges arising solely from the existence of the depositary arrangements. Chubb will pay charges of the Preferred Stock Depositary in 13 15 connection with the initial deposit of the Preferred Stock and issuance of Depositary Receipts, all withdrawals of shares of Preferred Stock by owners of Depositary Shares and any redemption of the Preferred Stock. Holders of Depositary Receipts will pay other transfer and other taxes and governmental charges and such other charges as are expressly provided in the Deposit Agreement to be for their accounts. (Deposit Agreement Section 5.07) The Preferred Stock Depositary may resign at any time by delivering to Chubb notice of its election to do so, and Chubb may at any time remove the Preferred Stock Depositary, any such resignation or removal to take effect upon the appointment of a successor Preferred Stock Depositary and its acceptance of such appointment. Such successor Preferred Stock Depositary must be appointed within 60 days after delivery of the notice of resignation or removal and must be a bank or trust company having its principal office in the United States and having a combined capital and surplus of at least $50,000,000 (Deposit Agreement Section 5.04) The Preferred Stock Depositary will forward to holders of Depositary Receipts all reports and communications from Chubb which are delivered to the Preferred Stock Depositary and which Chubb is required or otherwise determines to furnish to the holders of the Preferred Stock. (Deposit Agreement Section 4.07) Neither the Preferred Stock Depositary nor Chubb will be liable under the Deposit Agreement to holders of Depositary Receipts other than for its negligence, willful misconduct or bad faith. Neither Chubb nor the Preferred Stock Depositary will be obligated to prosecute or defend any legal proceeding in respect of any Depositary Shares or Preferred Stock unless satisfactory indemnity is furnished. Chubb and the Preferred Stock Depositary may rely upon written advice of its counsel or accountants, or upon information provided by persons presenting Preferred Stock for deposit, holders of Depositary Receipts or other persons believed to be competent and on documents believed to be genuine. (Deposit Agreement Section 5.03) SHAREHOLDERS RIGHTS PLAN In June 1989, the Board of Directors of Chubb adopted a Shareholder Rights Plan and declared a dividend distribution of one Right for each outstanding share of the Common Stock. As a result of the two-for-one stock split of the Common Stock in May 1990, the number of Rights per share of Common Stock was adjusted to one-half of a Right. Each Right entitles the registered holder to purchase from Chubb a unit consisting of one one-hundredth of a share (a "Unit") of Series A Participating Cumulative Preferred Stock, par value $1.00 per share (the "Preferred Stock"), at a Purchase Price of $225 per Unit subject to adjustment. The description and terms of the Rights are set forth in the Rights Agreement between Chubb and First Chicago Trust Company of New York, as Rights Agent. The Rights are attached to all outstanding shares of Common Stock, and no separate Rights Certificates will be distributed. The Rights will separate from the Common Stock and a Distribution Date will occur upon the earlier of: (i) 10 days following the date (the "Stock Acquisition Date") of any public announcement that a person or group of affiliated or associated persons (an "Acquiring Person") has acquired beneficial ownership of 25% or more of the outstanding shares of Common Stock, or (ii) 10 business days following the commencement of a tender offer or exchange offer that would result in a person or group becoming an Acquiring Person. Until the Distribution Date (or earlier redemption or expiration of the Rights), (i) the Rights will be evidenced by the Common Stock certificates and will be 14 16 transferred with and only with such Common Stock certificates, (ii) new Common Stock certificates issued after June 12, 1989 will contain a notation incorporating the Rights Agreement by reference, and (iii) the surrender for transfer of any certificates for Common Stock will also constitute the transfer of the Rights associated with the common Stock represented by such certificates. The Rights are not exercisable until the Distribution Date and will expire at the close of business on June 12, 1999 unless previously redeemed by Chubb as described below. As soon as practicable after the Distribution Date, Right Certificates will be mailed to holders of record of Common Stock as of the close of business on the Distribution Date and, thereafter the separate Right Certificates alone will represent the Rights. Except as otherwise determined by the Board of Directors, only shares of Common Stock issued prior to the Distribution Date will be issued with Rights. In the event that any person becomes an Acquiring Person, proper provision will be made so that each holder of a Right, other than Rights that are, or (under certain circumstances specified in the Rights Agreement) were, beneficially owned by an Acquiring Person (which will thereafter be void), will thereafter have the right to receive upon exercise that number of shares of Common Stock having a market value of two times the exercise price of the right. In the event that, at any time following the Stock Acquisition Date, (i) Chubb is acquired in a merger or other business combination transaction, or (ii) 50% or more of Chubb's assets or earning power is sold, each holder of a Right shall thereafter have the right to receive, upon exercise, common stock of the acquiring company having a value equal to two times the exercise price of the Right. The events described in this paragraph are referred to as "Triggering Events". The Purchase Price payable, and the number of Units of Preferred Stock or other securities or property issuable, upon exercise of the Rights are subject to adjustment from time to time to prevent dilution (i) in the event of a stock dividend on, or a subdivision, combination or reclassification of, the Preferred Stock, (ii) if holders of the Preferred Stock are granted certain rights or warrants to subscribe for Preferred Stock or convertible securities at less than the current market price of the Preferred Stock, or (iii) upon the distribution to holders of the Preferred Stock of evidences of indebtedness or assets (excluding regular quarterly cash dividends) or of subscription rights or warrants (other than those referred to above). With certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments amount to at least 1% of the Purchase Price. No fractional Units will be issued and, in lieu thereof, an adjustment in cash will be made based on the market price of the Preferred Stock on the last trading date prior to the date of exercise. The Rights may be redeemed in whole, but not in part, at a price of $.01 per Right by the Board of Directors at any time until the tenth day after the Stock Acquisition Date (or such later date as a majority of the Continuing Directors then in office may determine). Under certain circumstances set forth in the Rights Agreement, the decision to redeem shall require the concurrence of a majority of the Continuing Directors. Immediately upon the action of the Board of Directors ordering redemption of the Rights, with, where required, the concurrence of a majority of the Continuing Directors, the Rights will terminate and thereafter the only right of the holders of Rights will be to receive the redemption price. 15 17 The term "Continuing Director" means any member of the Board of Directors who was a member of the Board prior to the time the Acquiring Person becomes such, and any person who is subsequently elected to the Board if such person is recommended or approved by a majority of the Continuing Directors. Continuing Directors do not include an Acquiring Person, or an affiliate or associate of an Acquiring Person, or any representative of the foregoing entities. Until a Right is exercised, the holder will have no rights as a shareholder of Chubb (beyond those as an existing shareholder), including the right to vote or to receive dividends. As long as the Rights are attached to the Common Stock, Chubb will issue one half of a Right with each new share of Common Stock issued. DESCRIPTION OF WARRANTS Chubb or Capital may issue Warrants, including Warrants to purchase Debt Securities or Guaranteed Debt Securities ("Debt Warrants") as well as other types of Warrants to purchase Securities. Warrants may be issued independently or together with any Securities and may be attached to or separate from such Securities. The Warrants are to be issued under warrant agreements (each a "Warrant Agreement") to be entered into between Chubb or Capital, as the case may be, and a bank or trust company, as warrant agent (the "Warrant Agent"), all as shall be set forth in the Prospectus Supplement relating to the warrants being offered pursuant thereto. DEBT WARRANTS The applicable Prospectus Supplement will describe the terms of Debt Warrants offered thereby, the Warrant Agreement relating to such Debt Warrants and the debt warrant certificates representing such Debt Warrants, including the following: (1) the title of such Debt Warrants; (2) the aggregate number of such Debt Warrants; (3) the price or prices at which such Debt Warrants will be issued; (4) the currency or currencies, including composite currencies or currency units, in which the price of such Debt Warrants may be payable; (5) the designation, aggregate principal amount and terms of the Debt Securities or Guaranteed Debt Securities purchasable upon exercise of such Debt Warrants, and the procedures and conditions relating to the exercise of such Debt Warrants; (6) the designation and terms of any related Debt Securities or Guaranteed Debt Securities with which such Debt Warrants are issued, and the number of such Debt Warrants issued with each such security; (7) the currency or currencies, including composite currencies or currency units, in which the principal (or premium, if any), or interest, if any, on the Debt Securities or Guaranteed Debt Securities purchasable upon exercise of such Debt Warrants will be payable; (8) the date, if any, on and after which such Debt Warrants and the related Debt Securities or Guaranteed Debt Securities will be separately transferable; (9) the principal amount of Debt Securities or Guaranteed Debt Securities purchasable upon exercise of each Debt Warrant, and the price at which and the currency, including composite currency or currency unit, in which such principal amount of Debt Securities or Guaranteed Debt Securities may be purchased upon such exercise; (10) the date on which the right to exercise such Debt Warrants shall commence, and the date on which such right shall expire; (11) the maximum or minimum number of such Debt Warrants which may be exercised at any time; (12) a discussion of material federal income tax considerations, if any; (13) in the case of Debt Warrants issued by Capital, the extent (if any) to which Chubb will guarantee the performance by Capital of its obligations under such Debt Warrants; and (14) any other terms of such Debt Warrants and terms, procedures and limitations relating to the exercise of such Debt Warrants. 16 18 Debt Warrant certificates will be exchangeable for new Debt Warrant certificates of different denominations, and Debt Warrants may be exercised at the corporate trust office of the Warrant Agent or any other office indicated in the Prospectus Supplement. Prior to the exercise of their Debt Warrants, holders of Debt Warrants will not have any of the rights of holders of the securities purchasable upon such exercise and will not be entitled to payments of principal of (or premium, if any) or interest, if any, on the securities purchasable upon such exercise. OTHER WARRANTS Chubb may issue other Warrants. The applicable Prospectus Supplement will describe the following terms of any such other Warrants in respect of which this Prospectus is being delivered: (1) the title of such Warrants; (2) the Securities (which may include Preferred Stock or Common Stock) for which such Warrants are exercisable; (3) the price or prices at which such Warrants will be issued; (4) the currency or currencies, including composite currencies or currency units, in which the price of such Warrants may be payable; (5) if applicable, the designation and terms of the Preferred Stock with which such Warrants are issued, and the number of such Warrants issued with each share of Preferred Stock or Common Stock; (6) any provisions for adjustment of the number or amount of securities receivable upon exercise of such Warrants or the exercise price of such Warrants; (7) if applicable, the date on and after which such Warrants and the related Preferred Stock or Common Stock will be separately transferable; (8) if applicable, a discussion of material federal income tax considerations; (9) any other terms of such Warrants, including terms, procedures and limitations relating to the exchange and exercise of such Warrants; (10) the date on which the right to exercise such Warrants shall commence, and the date on which such right shall expire; and (11) the maximum or minimum number of such Warrants which may be exercised at any time. EXERCISE OF WARRANTS Each Warrant will entitle the holder of Warrants to purchase for cash such principal amount of Securities at such exercise price as shall in each case be set forth in, or be determinable as set forth in, the Prospectus Supplement relating to the Warrants offered thereby. Warrants may be exercised at any time up to the close of business on the expiration date set forth in the Prospectus Supplement relating to the Warrants offered thereby. After the close of business on the expiration date, unexercised Warrants will become void. Warrants may be exercised as set forth in the Prospectus Supplement relating to the Warrants offered thereby. Upon receipt of payment and the warrant certificate properly completed and duly executed at the corporate trust office of the Warrant Agent or any other office indicated in the Prospectus Supplement, the Corporation will, as soon as practicable, forward the Securities purchasable upon such exercise. If less than all of the Warrants represented by such warrant certificate are exercised, a new warrant certificate will be issued for the remaining Warrants. PLAN OF DISTRIBUTION Offered Securities may be sold (i) through agents, (ii) through underwriters, (iii) through dealers or (iv) directly to purchasers (through a specific bidding or auction process or otherwise). 17 19 Offers to purchase Offered Securities may be solicited by agents designated by Chubb or Capital, as the case may be, from time to time. Any such agent involved in the offer or sale of the Offered Securities will be named, and any commissions payable by Chubb or Capital, as the case may be, to such agent will be set forth, in the Prospectus Supplement. Unless otherwise indicated in the Prospectus Supplement, any such agent will be acting on a best efforts basis for the period of its appointment. Any such agent may be deemed to be an underwriter, as that term is defined in the Securities Act of 1933, as amended (the "1933 Act") of the Offered Securities so offered and sold. If an underwriter or underwriters are utilized in the sale of Offered Securities, Chubb or Capital, as the case may be, 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 Prospectus Supplement, which will be used by the underwriters to make resales of Offered Securities. If a dealer is utilized in the sale of Offered Securities, Chubb or Capital, as the case may be, will sell such Offered Securities to the dealer, as principal. The dealer may then resell such Offered 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 Prospectus Supplement relating thereto. Offers to purchase Offered Securities may be solicited directly by Chubb or Capital, as the case may be, and sales thereof may be made by Chubb or Capital, as the case may be, 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 Prospectus Supplement relating thereto. Offered Securities may also be offered and sold, if so indicated in the Prospectus Supplement, in connection with a remarketing upon their purchase, in accordance with a redemption or repayment pursuant to their terms, or otherwise, by one or more firms ("remarketing firms"), acting as principals for their own accounts or as agents for Chubb or Capital, as the case may be. Any remarketing firm will be identified and the terms of its agreement, if any, with Chubb or Capital, as the case may be, and its compensation will be described in the Prospectus Supplement. Remarketing firms may be deemed to be underwriters in connection with the Debt Securities or Guaranteed Debt Securities remarketed thereby. Agents, underwriters, dealers and remarketing firms may be entitled under agreements which may be entered into with Chubb or Capital, as the case may be, to indemnification by Chubb or Capital, as the case may be, against certain liabilities, including liabilities under the 1933 Act, and any such agents, underwriters, dealers or remarketing firms, or their affiliates may be customers of, engage in transactions with or perform services for Chubb or Capital, as the case may be, in the ordinary course of business. If so indicated in the Prospectus Supplement, Chubb or Capital, as the case may be, will authorize agents and underwriters to solicit offers by certain institutions to purchase Debt Securities or Guaranteed Debt Securities from Chubb or Capital, as the case may be, at the public offering price set forth in the Prospectus Supplement pursuant to Delayed Delivery Contracts ("Contracts") providing for payment and delivery on the date stated in the Prospectus Supplement. Such Contracts will be subject to only those conditions set forth in the Prospectus Supplement. A commission indicated in the Prospectus Supplement will be paid to underwriters and agents soliciting purchases of Debt Securities or Guaranteed Debt Securities pursuant to Contracts accepted by Chubb or Capital, as the case may be. 18 20 EXPERTS The consolidated financial statements of The Chubb Corporation incorporated by reference in the Annual Report (Form 10-K) and the financial statement schedules included therein of Chubb for the year ended December 31, 1994 have been audited by Ernst & Young LLP, independent auditors, as set forth in their reports dated February 24, 1995 and March 27, 1995, included or incorporated by reference therein, and are incorporated herein by reference in reliance upon such reports given upon the authority of such firm as experts in accounting and auditing. Any financial statements and schedules hereafter incorporated by reference in the registration statement of which this prospectus is a part that have been audited and are the subject of a report by independent accountants will be incorporated herein by reference in reliance upon such reports and upon the authority of such firms as experts in accounting and auditing to the extent covered by consents filed with the Commission. LEGAL MATTERS The validity of the Offered Securities offered hereby will be passed upon for Chubb or Capital, as the case may be, by Davis Polk & Wardwell, New York, New York. Davis Polk & Wardwell will rely upon Shanley & Fisher, P.C., with respect to certain matters of New Jersey law. 19 21 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. Registration fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $137,932.00 Trustees' fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,000.00 Costs of printing and engraving . . . . . . . . . . . . . . . . . . . . . . . . . 56,000.00 Legal fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 200,000.00 Accounting fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,000.00 Blue sky fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,000.00 ----------- Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 488,932.00
All amounts estimated except for registration fees. ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Article XII of the Restated Certificate of Incorporation of Chubb reads as follows: TWELFTH: SECTION A. A Director or Officer of the Corporation shall not be personally liable to the Corporation or its stockholders for damages for breach of any duty owed to the Corporation or its stockholders, except for liability for any breach of duty based upon an act or omission (i) in breach of such Director's or Officer's duty of loyalty to the Corporation or stockholders, (ii) not in good faith or involving a knowing violation of law or (iii) resulting in receipt by such Director or Officer of an improper personal benefit. The provisions of this section shall be effective as and to the fullest extent that, in whole or in part, they shall be authorized or permitted by the laws of the State of New Jersey. No repeal or modification of the foregoing provisions of this Section A nor, to the fullest extent permitted by law, any modification of law shall adversely affect any right or protection of a Director or Officer of the Corporation which exists at the time of such repeal or modification. SECTION B. 1. As used in this Section B: (a) "corporate agent" means any person who is or was a director, officer, or employee of the Corporation and any person who is or was director, officer, trustee or employee of any other enterprise, serving, or continuing to serve, as such at the written II-1 22 request of the Corporation, signed by the Chairman or the President or pursuant to a resolution of the Board of Directors, or the legal representative of any such person; (b) "other enterprise" means any domestic or foreign corporation, other than the Corporation, and any partnership, joint venture, sole proprietorship, trust, employee benefit plan or other enterprise, whether or not for profit, served by a corporate agent; (c) "expenses" means reasonable costs, disbursements and counsel fees; (d) "liabilities" means amounts paid or incurred in satisfaction of settlements, judgments, fines and penalties; (e) "proceeding" means any pending, threatened or completed civil, criminal, administrative or arbitrative action, suit or proceeding, and any appeal therein and any inquiry or investigation which could lead to such action, suit or proceeding, and shall include any proceeding as so defined existing at or before, and any proceedings relating to facts occurring or circumstances existing at or before, the adoption of this Section B. 2. Each corporate agent shall be indemnified by the Corporation against his expenses and liabilities in connection with any proceeding involving the corporate agent by reason of his having been such corporate agent to the fullest extent permitted by applicable law as the same exists or may hereafter be amended or modified. The right to indemnification conferred by this paragraph 2 shall also include the right to be paid by the Corporation the expenses incurred in connection with any such proceeding in advance of its final disposition to the fullest extent authorized by applicable law as the same exists or may hereafter be amended or modified. The right to indemnification conferred in this paragraph 2 shall be a contract right. 3. The Corporation may purchase and maintain insurance on behalf of any corporate agent against any expenses incurred in any proceedings and any liabilities asserted against him by reason of his having been a corporate agent, whether or not the Corporation would have the power to indemnify him against such expenses and liabilities under applicable law as the same exists or may hereafter be amended or modified. The Corporation may purchase such insurance from, or such insurance may be reinsured in whole or in part by, an insurer owned by or otherwise affiliated with the Corporation, whether or not such insurer does business with other insureds. The rights and authority conferred in this Section B shall not exclude any other right to which any person may be entitled under this Certificate of Incorporation, the By-Laws, any agreement, vote of stockholders or otherwise. No repeal or modification of the foregoing provisions of this Section B nor, to the fullest extent permitted by law, any modification of law, shall adversely affect any right or protection of a corporate agent which exists at the time of such repeal or modification. II-2 23 * * * Article Seventh of the Certificate of Incorporation of Capital reads as follows: SEVENTH: SECTION A. A Director or Officer of the Corporation shall not be personally liable to the Corporation or its stockholders for damages for breach of any duty owed to the Corporation or its stockholders, except for liability for any breach of duty based upon an act or omission (i) in breach of such Director's or Officer's duty of loyalty to the Corporation or stockholders, (ii) not in good faith or involving a knowing violation of law or (iii) resulting in receipt by such Director or Officer of an improper personal benefit. The provisions of this section shall be effective as and to the fullest extent that, in whole or in part, they shall be authorized or permitted by the laws of the State of New Jersey. No repeal or modification of the foregoing provisions of this Section A nor, to the fullest extent permitted by law, any modification of law shall adversely affect any right or protection of a Director or Officer of the Corporation which exists at the time of such repeal or modification. SECTION B. 1. As used in this Section B: (a) "corporate agent" means any person who is or was a director, officer, or employee of the Corporation and any person who is or was a director, officer, trustee or employee of any other enterprise, serving, or continuing to serve, as such at the written request of the Corporation, signed by the Chairman or the President or pursuant to a resolution of the Board of Directors, or the legal representative of any such person; (b) "other enterprise" means any domestic or foreign corporation, other than the Corporation, and any partnership, joint venture, sole proprietorship, trust, employee benefit plan or other enterprise, whether or not for profit, served by a corporate agent; (c) "expenses" means reasonable costs, disbursements and counsel fees; (d) "liabilities" means amounts paid or incurred in satisfaction of settlements, judgments, fines and penalties; (e) "proceeding" means any pending, threatened or completed civil, criminal, administrative or arbitrative action, suit or proceeding, and any appeal therein and any inquiry or investigation which could lead to such action, suit or proceeding, and shall include any proceeding as so defined existing at or before, and any proceedings relating to facts occurring or circumstances existing at or before, the adoption of this Section B. II-3 24 2. Each corporate agent shall be indemnified by the Corporation against his expenses and liabilities in connection with any proceeding involving the corporate agent by reason of his having been such corporate agent to the fullest extent permitted by applicable law as the same exists or may hereafter be amended or modified. The right to indemnification conferred by this paragraph 2 shall also include the right to be paid by the Corporation the expenses incurred in connection with any such proceeding in advance of its final disposition to the fullest extent authorized by applicable law as the same exists or may hereafter be amended or modified. The right to indemnification conferred in this paragraph 2 shall be a contract right. 3. The Corporation may purchase and maintain insurance on behalf of any corporate agent against any expenses incurred in any proceedings and any liabilities asserted against him by reason of his having been a corporate agent, whether or not the Corporation would have the power to indemnify him against such expenses and liabilities under applicable law as the same exists or may hereafter be amended or modified. The Corporation may purchase such insurance from, or such insurance may be reinsured in whole or in part by, an insurer owned by or otherwise affiliated with the Corporation, whether or not such insurer does business with other insureds. The rights and authority conferred in this Section B shall not exclude any other right to which any person may be entitled under this Certificate of Incorporation, the By-Laws, any agreement, vote of stockholders or otherwise. No repeal or modification of the foregoing provisions of this Section B nor, to the fullest extent permitted by law, any modification of law, shall adversely affect any right or protection of a corporate agent which exists at the time of such repeal or modification. * * * Chubb and Capital are insured against liabilities which they may incur by reason of Article XII of Chubb's Restated Certificate of Incorporation and Article Seventh of Capital's Certificate of Incorporation, respectively. In addition, Directors and Officers of Chubb and Capital are insured, at the expense of Chubb against certain liabilities which might arise out of their employment and not be subject to indemnification. ITEM 16. LIST OF EXHIBITS AND EXHIBIT INDEX Exhibit 1.1 - Form of Underwriting Agreement relating to the Debt Securities. Exhibit 1.2 - Form of Underwriting Agreement relating to the Guaranteed Debt Securities. Exhibit 1.3 - Form of Underwriting Agreement relating to the Common Stock, Preferred Stock and convertible Subordinated Debt Securities of Chubb. II-4 25 Exhibit 1.4 - Form of Underwriting Agreement relating to the convertible Guaranteed Subordinated Debt Securities of Capital. Exhibit 4.1 - Indenture dated as of October 25, 1989, between Chubb and The First National Bank of Chicago relating to Senior Debt Securities (incorporated herein by reference to Exhibit 4(a) to Chubb's and Capital's Registration Statement on Form S-3 (No. 33-31796)). Exhibit 4.2 - Indenture dated as of October 25, 1989, among, Capital, Chubb, as guarantor and The First National Bank of Chicago relating to Guaranteed Senior Debt Securities (incorporated herein by reference to Exhibit 4(a) to Chubb's and Capital's Registration Statement on Form S-3 (No. 33-31796)). Exhibit 4.3 - Form of Indenture between Chubb and The First National Bank of Chicago relating to Subordinated Debt Securities. Exhibit 4.4 - Form of Indenture among Capital, Chubb, as guarantor and The First National Bank of Chicago relating to Guaranteed Subordinated Debt Securities. Exhibit 4.5 - Forms of Senior Debt Securities (included in Exhibit 4.1). Exhibit 4.6 - Forms of Guaranteed Senior Debt Securities (included in Exhibit 4.2). Exhibit 4.7 - Forms of Subordinated Debt Securities (included in Exhibit 4.3). Exhibit 4.8 - Forms of Guaranteed Subordinated Debt Securities (included in Exhibit 4.4). Exhibit 4.9 - Restated Certificate of Incorporation of Chubb (incorporated herein by reference to Exhibit 3 to Chubb's 1994 Annual Report on Form 10-K). Exhibit 4.10 - Form of Deposit Agreement. Exhibit 4.11 - Form of Depositary Receipt for Chubb Depositary Shares (included in Exhibit 4.10). Exhibit 4.12 - Form of Chubb Common Stock and Preferred Stock Warrant Agreement. Exhibit 4.13 - Form of Chubb Debt Warrant Agreement. Exhibit 4.14 - Form of Capital Debt Warrant Agreement. Exhibit 5.1 - Opinion of Davis Polk & Wardwell as to the legality of Securities to be issued. Exhibit 5.2 - Opinion of Shanley & Fisher, P.C. as to certain matters of New Jersey law. Exhibit 12 - Statement re: Computation of Ratio of Consolidated Earnings to Fixed Charges of Chubb. Exhibit 23.1 - Consent of Ernst & Young LLP II-5 26 Exhibit 23.2 - Consent of Davis Polk & Wardwell (included in Exhibit 5.1). Exhibit 23.3 - Consent of Shanley & Fisher, P.C. (included in Exhibit 5.2). Exhibit 24.1 - Powers of Attorney for the Directors of Chubb. Exhibit 24.2 - Powers of Attorney for the Directors of Capital. Exhibit 25.1 - Statement of Eligibility and Qualification of the Trustee under the Trust Indenture Act for Chubb. Exhibit 25.2 - Statement of Eligibility and Qualification of the Trustee under the Trust Indenture Act for Capital. Exhibit 28 - Information from reports furnished to state insurance regulatory authorities (incorporated herein by reference to Exhibit 28 to Chubb's 1994 Annual Report on Form 10-K). ITEM 17. UNDERTAKINGS. The undersigned registrants hereby undertake: (1) To file, during any period in which offers or sales are being made of the securities registered hereby, 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; (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 this registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in this registration statement or any material change to such information in this registration statement; provided, however, that the undertakings set forth in paragraph (i) and (ii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the registrants pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this 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 herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (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. II-6 27 The undersigned registrants hereby further undertake that, for purposes of determining any liability under the Securities Act of 1933, each filing of a registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrants pursuant to the provisions set forth or described in Item 15 of this Registration Statement, or otherwise, the registrants have 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 registrants of expenses incurred or paid by a director, officer or controlling person of such 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 registered hereby, such 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 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. II-7 28 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, The Chubb Corporation 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 Township of Warren, State of New Jersey, on the 5th day of May, 1995. THE CHUBB CORPORATION /s/ Gail E. Devlin By ------------------------------------- GAIL E. DEVLIN SENIOR VICE PRESIDENT SIGNATURES Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities as Directors and Officers of The Chubb Corporation and on the date indicated.
Signature Title Date --------- ----- ---- * Chairman, President, Chief May 5, 1995 ----------------------------------------------- Executive Officer and Director (Dean R. O'Hare) * Vice Chairman, Chief May 5, 1995 ----------------------------------------------- Financial Officer (Percy Chubb, III) and Director * ----------------------------------------------- Director May 5, 1995 (John C. Beck) * ----------------------------------------------- Director May 5, 1995 (Joel J. Cohen) * ----------------------------------------------- Director May 5, 1995 (Henry U. Harder) * ----------------------------------------------- Director May 5, 1995 (David H. Hoag)
II-8 29
Signature Title Date --------- ----- ---- * ----------------------------------------------- Director May 5, 1995 (Robert V. Lindsay) * ----------------------------------------------- Director May 5, 1995 (Thomas C. MacAvoy) * ----------------------------------------------- Director May 5, 1995 (Gertrude G. Michelson) * ----------------------------------------------- Director May 5, 1995 (Warren B. Rudman) * ----------------------------------------------- Director May 5, 1995 (Sir David G. Scholey, CBE) * ----------------------------------------------- Director May 5, 1995 (Raymond G. Seitz) * ----------------------------------------------- Director May 5, 1995 (Lawrence M. Small) * ----------------------------------------------- Director May 5, 1995 (Richard D. Wood) * ----------------------------------------------- Senior Vice President and May 5, 1995 (Henry B. Schram) Chief Accounting Officer *By /s/ Henry G. Gulick ----------------------------------------------- (Henry G. Gulick, Attorney in Fact)
II-9 30 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, Chubb Capital Corporation 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 Township of Warren, State of New Jersey, on the 5th day of May, 1995. CHUBB CAPITAL CORPORATION By /s/ Gail E. Devlin ------------------------------------- GAIL E. DEVLIN VICE PRESIDENT Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities as officers and directors of Chubb Capital Corporation and on the date indicated.
Signature Title Date --------- ----- ---- * ----------------------------------------------- President and Director May 5, 1995 (Dean R. O'Hare) * ----------------------------------------------- Vice President, Treasurer and May 5, 1995 (Eric H. Grosseibl) Director /s/ Henry G. Gulick ----------------------------------------------- Vice President, Secretary and May 5, 1995 (Henry G. Gulick) Director /s/ Gail E. Devlin ----------------------------------------------- Vice President and Director May 5, 1995 (Gail E. Devlin) * ----------------------------------------------- Vice President and Director May 5, 1995 (Philip J. Sempier) *By /s/ Henry G. Gulick ----------------------------------------------- (Henry G. Gulick, Attorney in Fact)
II-10 31 EXHIBIT LIST EXHIBIT - ------- Exhibit 1.1 - Form of Underwriting Agreement relating to the Debt Securities. Exhibit 1.2 - Form of Underwriting Agreement relating to the Guaranteed Debt Securities. Exhibit 1.3 - Form of Underwriting Agreement relating to the Common Stock, Preferred Stock and convertible Subordinated Debt Securities of Chubb. Exhibit 1.4 - Form of Underwriting Agreement relating to the convertible Guaranteed Subordinated Debt Securities of Capital. Exhibit 4.1 - Indenture dated as of October 25, 1989, between Chubb and The First National Bank of Chicago relating to Senior Debt Securities (incorporated herein by reference to Exhibit 4(a) to Chubb's and Capital's Registration Statement on Form S-3 (No. 33-31796)). Exhibit 4.2 - Indenture dated as of October 25, 1989, among, Capital, Chubb, as guarantor and The First National Bank of Chicago relating to Guaranteed Senior Debt Securities (incorporated herein by reference to Exhibit 4(a) to Chubb's and Capital's Registration Statement on Form S-3 (No. 33-31796)). Exhibit 4.3 - Form of Indenture between Chubb and The First National Bank of Chicago relating to Subordinated Debt Securities. Exhibit 4.4 - Form of Indenture among Capital, Chubb, as guarantor and The First National Bank of Chicago relating to Guaranteed Subordinated Debt Securities. Exhibit 4.5 - Forms of Senior Debt Securities (included in Exhibit 4.1). Exhibit 4.6 - Forms of Guaranteed Senior Debt Securities (included in Exhibit 4.2). Exhibit 4.7 - Forms of Subordinated Debt Securities (included in Exhibit 4.3). Exhibit 4.8 - Forms of Guaranteed Subordinated Debt Securities (included in Exhibit 4.4). 32 Exhibit 4.9 - Restated Certificate of Incorporation of Chubb (incorporated herein by reference to Exhibit 3 to Chubb's 1994 Annual Report on Form 10-K). Exhibit 4.10 - Form of Deposit Agreement. Exhibit 4.11 - Form of Depositary Receipt for Chubb Depositary Shares (included in Exhibit 4.10). Exhibit 4.12 - Form of Chubb Common Stock and Preferred Stock Warrant Agreement. Exhibit 4.13 - Form of Chubb Debt Warrant Agreement. Exhibit 4.14 - Form of Capital Debt Warrant Agreement. Exhibit 5.1 - Opinion of Davis Polk & Wardwell as to the legality of Securities to be issued. Exhibit 5.2 - Opinion of Shanley & Fisher, P.C. as to certain matters of New Jersey law. Exhibit 12 - Statement re: Computation of Ratio of Consolidated Earnings to Fixed Charges of Chubb. Exhibit 23.1 - Consent of Ernst & Young LLP. Exhibit 23.2 - Consent of Davis Polk & Wardwell (included in Exhibit 5.1). Exhibit 23.3 - Consent of Shanley & Fisher, P.C. (included in Exhibit 5.2). Exhibit 24.1 - Powers of Attorney for the Directors of Chubb. Exhibit 24.2 - Powers of Attorney for the Directors of Capital. Exhibit 25.1 - Statement of Eligibility and Qualification of the Trustee under the Trust Indenture Act for Chubb. Exhibit 25.2 - Statement of Eligibility and Qualification of the Trustee under the Trust Indenture Act for Capital. Exhibit 28 - Information from reports furnished to state insurance regulatory authorities (incorporated herein by reference to Exhibit 28 to Chubb's 1994 Annual Report on Form 10-K). EX-1.1 2 UNDERWRITING AGREEMENT - DEBT SECURITIES 1 Exhibit 1.1 THE CHUBB CORPORATION Debt Securities _________ Underwriting Agreement __________, 19__ [Name(s) and address(es) of Representatives.] Dear Sirs/Mesdames: From time to time The Chubb Corporation, a New Jersey corporation (the "Company"), proposes to enter into one or more Pricing Agreements (each a "Pricing Agreement") in the form of Annex I hereto, with such additions and deletions as the parties thereto may determine, and, subject to the terms and conditions stated herein and therein, to issue and sell to the firms named in Schedule I to the applicable Pricing Agreement (such firms constituting the "Underwriters" with respect to such Pricing Agreement and the securities specified therein) certain of its (i) senior debt securities (the "Senior Securities") issued pursuant to the senior indenture dated October 25, 1989 (the "Senior Indenture") between the Company and The First National Bank of Chicago, as Trustee and (ii) subordinated debt securities (the "Subordinated Securities") issued pursuant to the subordinated indenture dated ______, 199_ between the Company and The First National Bank of Chicago, as Trustee, (the "Subordinated Indenture"), (the Senior Securities together with the Subordinated Securities, the "Securities") specified in Schedule II to such Pricing Agreement (with respect to such Pricing Agreement, the "Designated Securities"). The terms and rights of any particular issuance of Designated Securities shall be as specified in the Pricing Agreement relating thereto and in or pursuant to the applicable Indenture, identified in such Pricing Agreement. 2 1. Particular sales of Designated Securities may be made from time to time to the Underwriters of such Securities, for whom the firms designated as representatives of the Underwriters of such Securities in the Pricing Agreement relating thereto will act as representatives (the "Representatives"). The term "Representatives" also refers to a single firm acting as sole representative of the Underwriters and to Underwriters who act without any firm being designated as their representative. This Underwriting Agreement shall not be construed as an obligation of the Company to sell any of the Securities or as an obligation of any of the Underwriters to purchase the Securities. The obligation of the Company to issue and sell any of the Securities and the obligation of any of the Underwriters to purchase any of the Securities shall be evidenced by the Pricing Agreement with respect to the Designated Securities specified therein. Each Pricing Agreement shall specify the aggregate principal amount of such Designated Securities, the initial public offering price of such Designated Securities, the purchase price to the Underwriters of such Designated Securities, the names of the Underwriters of such Designated Securities, the names of the Representatives of such Underwriters and the principal amount of such Designated Securities to be purchased by each Underwriter and shall set forth the date, time and manner of delivery of such Designated Securities and payment therefor. The Pricing Agreement shall also specify (to the extent not set forth in the applicable Indenture and the registration statement and prospectus with respect thereto) the terms of such Designated Securities. A Pricing Agreement shall be in the form of an executed writing (which may be in counterparts), and may be evidenced by an exchange of telegraphic communications or any other rapid transmission device designed to produce a written record of communications transmitted. The obligations of the Underwriters under this Agreement and each Pricing Agreement shall be several and not joint. 2. The Company represents and warrants to, and agrees with, each of the Underwriters that: (a) A registration statement in respect of the Securities has been filed with the Securities and Exchange Commission (the "Commission"); such registration statement and any post-effective amendment thereto, each in the form heretofore delivered or to be delivered to the Representatives and, excluding exhibits to such registration statement, but including all documents incorporated by reference in the prospectus contained therein, to the Representatives for each of the other Underwriters have been declared 2 3 effective by the Commission in such form; no other document with respect to such registration statement or document incorporated by reference therein has heretofore been filed or transmitted for filing with the Commission; and no stop order suspending the effectiveness of such registration statement has been issued and no proceeding for that purpose has been initiated or threatened by the Commission (any preliminary prospectus included in such registration statement or filed with the Commission pursuant to Rule 424(a) of the rules and regulations of the Commission under the Securities Act of 1933, as amended (the "Act"), being hereinafter called a "Preliminary Prospectus"; the various parts of such registration statement, including all exhibits thereto and the documents incorporated by reference in the prospectus contained in the registration statement, at the time such part of the registration statement became effective but excluding Form T-1, each as amended at the time such part of the registration statement became effective, being hereinafter called the "Registration Statement"; the prospectus relating to the Securities, in the form in which it has most recently been filed, or transmitted for filing, with the Commission on or prior to the date of this Agreement, being hereinafter called the "Prospectus"; any reference herein to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to the applicable form under the Act, as of the date of such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after the date of such Preliminary Prospectus or Prospectus, as the case may be, under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and incorporated by reference in such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment to the Registration Statement shall be deemed to refer to and include any annual report of the Company filed pursuant to Section 13(a) or 15(d) of the Exchange Act after the effective date of the Registration Statement that is incorporated by reference in the Registration Statement; and any reference to the Prospectus as amended or supplemented shall be deemed to refer to the Prospectus as amended or supplemented in relation to the applicable Designated Securities in the form in which it is filed with the Commission pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof, including 3 4 any documents incorporated by reference therein as of the date of such filing); (b) The documents incorporated by reference in the Prospectus, when they became effective or were filed with the Commission, as the case may be, complied as to form in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and none of such documents contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading; and any further documents so filed and incorporated by reference in the Prospectus or any further amendment or supplement thereto, when such documents become effective or are filed with the Commission, as the case may be, will comply as to form in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities; (c) The Registration Statement and the Prospectus comply as to form, and any further amendments or supplements to the Registration Statement or the Prospectus will comply as to form, in all material respects to the requirements of the Act and the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") and the rules and regulations of the Commission thereunder and do not and will not, as of the applicable effective date as to the Registration Statement and any amendment thereto and as of the applicable filing date as to the Prospectus and any amendment or supplement thereto, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by an 4 5 Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities; (d) Neither the Company nor any of its subsidiaries has sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, which loss or interference would have a material adverse effect on the business or financial condition of the Company and its subsidiaries taken as a whole, otherwise than as set forth or contemplated in the Prospectus; and, since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has not been any material adverse change, or any development involving a prospective material adverse change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries, otherwise than as set forth or contemplated in the Prospectus; (e) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus and has been duly qualified as a foreign corporation for the transaction of business in each other jurisdiction in which it owns or leases property, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of the failure to be so qualified in any such jurisdiction; (f) The Securities have been duly authorized, and, when Designated Securities are issued and delivered pursuant to this Agreement and any Pricing Agreement with respect to such Designated Securities, such Designated Securities will have been duly executed, authenticated, issued and delivered and will constitute valid and legally binding obligations of the Company entitled to the benefits provided by the applicable Indenture, which will be substantially in the form incorporated by reference as an exhibit to the Registration Statement; each Indenture has been duly authorized and duly qualified under the Trust Indenture Act and, at the Time of Delivery for such Designated 5 6 Securities (as defined in Section 4 hereof), each Indenture will constitute a valid and legally binding instrument, enforceable in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; and each Indenture conforms, and the Designated Securities will conform, to the descriptions thereof contained in the Prospectus as amended or supplemented with respect to such Designated Securities; (g) The issue and sale of the Securities and the compliance by the Company with all of the provisions of the Securities, the Indentures, this Agreement and any Pricing Agreement, and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, nor will such action result in any violation of the provisions of the Restated Certificate of Incorporation or By-laws of the Company or any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its subsidiaries or any of their properties except for such conflicts, breaches, violations or defaults which would not have a material adverse effect on the business, financial condition or results of operations of the Company and its subsidiaries taken as a whole or the Company's ability to perform its obligations under this Agreement and the Securities; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Securities or the consummation by the Company of the transactions contemplated by this Agreement or any Pricing Agreement or the Indentures, except such as have been, or will have been prior to the Time of Delivery, obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Securities by the Underwriters; and 6 7 (h) Other than as set forth in the Prospectus, there are no legal or governmental proceedings pending (including proceedings of any insurance regulatory authority) to which the Company or any of its subsidiaries is a party or of which any property of the Company or any of its subsidiaries is the subject which, if determined adversely to the Company or any of its subsidiaries, would individually or in the aggregate have a material adverse effect on the consolidated financial position, stockholders' equity or results of operations of the Company and its subsidiaries; and, to the best of the Company's knowledge, no such proceedings are threatened. 3. Upon the execution of the Pricing Agreement applicable to any Designated Securities and authorization by the Representatives of the release of such Designated Securities, the several Underwriters propose to offer such Designated Securities for sale upon the terms and conditions set forth in the Prospectus as amended or supplemented. 4. Designated Securities to be purchased by each Underwriter pursuant to the Pricing Agreement relating thereto, in definitive form to the extent practicable, and in such authorized denominations and registered in such names as the Representatives may request upon at least forty-eight hours' prior notice to the Company, shall be delivered by or on behalf of the Company to the Representatives for the account of such Underwriter, against payment by such Underwriter or on its behalf of the purchase price therefor by certified or official bank check or checks, payable to the order of the Company in the funds specified in such Pricing Agreement, all at the place and time and date specified in such Pricing Agreement or at such other place and time and date as the Representatives and the Company may agree upon in writing, such time and date being herein called the "Time of Delivery" for such Securities. 5. The Company agrees with each of the Underwriters of any Designated Securities: (a) To prepare the Prospectus as amended and supplemented in relation to the applicable Designated Securities in a form approved by the Representatives and to file such Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's close of business on the second business day following the execution and delivery of the Pricing Agreement relating to the applicable Designated Securities or, if applicable, such earlier time as may be required by Rule 424(b); to make no further amendment or any 7 8 supplement to the Registration Statement or Prospectus as amended or supplemented after the date of the Pricing Agreement relating to such Securities and prior to the Time of Delivery for such Securities which shall be disapproved by the Representatives for such Securities promptly after reasonable notice thereof, and such disapproval shall not be unreasonable; to advise the Representatives promptly of any such amendment or supplement after such Time of Delivery and furnish the Representatives with copies thereof; to file promptly all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the delivery of a prospectus is required in connection with the offering or sale of such Securities, and during such same period to advise the Representatives, promptly after it received notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to the Prospectus or any amended Prospectus has been filed with the Commission, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any prospectus relating to the Securities, of the suspension of the qualification of such Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information; and, in the event of the issuance of any such stop order or of any such order preventing or suspending the use of any prospectus relating to the Securities, of the suspension of the qualification of such Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information; and, in the event of the issuance of any such stop order or of any such order preventing or suspending the use of any prospectus relating to the Securities or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal; (b) Promptly from time to time to take such action as the Representatives may reasonably request to qualify such Securities for offering and sale under the securities laws of such jurisdictions as the Representatives may request and to comply with such laws so as to permit the continuance of sales and 8 9 dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of such Securities, provided that in connection therewith the Company shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction; (c) To furnish the Underwriters with copies of the Prospectus as amended or supplemented in such quantities as the Representatives may from time to time reasonably request, and, if the delivery of a prospectus is required at any time in connection with the offering or sale of the Securities and if at such time any event shall have occurred as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or, if for any other reason it shall be necessary during such same period to amend or supplement the Prospectus or to file under the Exchange Act any document incorporated by reference in the Prospectus in order to comply with the Act, the Exchange Act or the Trust Indenture Act, to notify the Representatives and upon their request to file such document and to prepare and furnish without charge to each Underwriter and to any dealer in securities as many copies as the Representatives may from time to time reasonably request of an amended Prospectus or a supplement to the Prospectus which will correct such statement or omission or effect such compliance; (d) To make generally available to its securityholders as soon as practicable, but in any event not later than eighteen months after the effective date of the Registration Statement (as defined in Rule 158(c)), an earnings statement of the Company and its subsidiaries (which need not be audited) complying with Section 11(a) of the Act and the rules and regulations of the Commission thereunder (including at the option of the Company Rule 158); and (e) During the period beginning from the date of the Pricing Agreement for such Designated Securities and continuing to and including the earlier of (i) the termination of trading restrictions for such Designated Securities, as notified to the Company by the Representatives and (ii) the Time of Delivery for such Designated Securities, not to offer, sell, contract to 9 10 sell or otherwise dispose of any debt securities of the Company which mature more than one year after such Time of Delivery and which are substantially similar to such Designated Securities, without the prior written consent of the Representatives. 6. The Company covenants and agrees with the several Underwriters that the Company will pay or cause to be paid the following: (i) the reasonable fees, disbursements and expenses of the Company's counsel and independent auditors in connection with the registration of the Securities under the Act and all other expenses in connection with the preparation, printing and filing of the Registration Statement, any Preliminary Prospectus and the Prospectus and amendments and supplements thereto and the mailing and delivering of copies thereof to the Underwriters and dealers; (ii) the cost of producing any Agreement among Underwriters, this Agreement, any Pricing Agreement, the Indentures, any Blue Sky Memoranda and any other documents in connection with the offering, purchase, sale and delivery of the Securities; (iii) all expenses in connection with the qualification of the Securities for offering and sale under state securities laws as provided in section 5(b) hereof, including the fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky surveys; (iv) any fees charged by securities rating services for rating the Securities; (v) any filing fees incident to any required review by the National Association of Securities Dealers, Inc. of the terms of the sale of the Securities; (vi) the cost of preparing the Securities; (vii) the reasonable fees and expenses of any Trustee and any agent of any Trustee and the fees and disbursements of counsel for any Trustee in connection with any Indenture and the Securities; and (viii) all other costs and expenses incident to the performance of its obligations hereunder which are not otherwise specifically provided for in this Section. It is understood, however, that, except as provided in this Section, Section 8 and Section 11 hereof, the Underwriters will pay all of their own costs and expenses, including the fees of their counsel, transfer taxes on resale of any of the Securities by them, and any advertising expenses connected with any offers they may make. 7. The obligations of the Underwriters of any Designated Securities under the Pricing Agreement relating to such Designated Securities shall be subject, in the discretion of the Representatives, to the condition that all representations and warranties and other statements of the Company in or incorporated by reference in the Pricing Agreement relating to such Designated Securities are, at and 10 11 as of the Time of Delivery for such Designated Securities, true and correct in all material respects, the condition that the Company shall have performed all of its obligations hereunder theretofore to be performed, and the following additional conditions: (a) The Prospectus as amended or supplemented in relation to the applicable Designated Securities shall have been filed with the Commission pursuant to Rule 424(b) within the applicable time period prescribed for such filing by the rules and regulations under the Act and in accordance with Section 5(a) hereof; no stop order suspending the effectiveness of the Registration Statement or any part thereof shall have been issued and no proceeding for that purpose shall have been initiated or threatened by the Commission; and all requests for additional information on the part of the Commission shall have been complied with to the Representatives' reasonable satisfaction; (b) Counsel for the Underwriters shall have furnished to the Representatives such opinion or opinions, dated the Time of Delivery for such Designated Securities, with respect to the validity of the applicable Indenture, the Designated Securities, the Registration Statement, the Prospectus as amended or supplemented and other related matters as the Representatives may reasonably request, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters; (c) Robert Rusis, Senior Vice President and General Counsel of the Company shall have furnished to the Representatives his written opinion, dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) The Company has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each foreign jurisdiction in which it owns or leases property, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of failure to be so qualified in any such jurisdiction (such counsel being entitled to rely in respect of the opinion in this clause upon opinions of local counsel and in respect of matters of fact upon certificates of officers of 11 12 the Company or its subsidiaries, provided that such counsel shall state that he believes that both the Representatives and he are justified in relying upon such opinions and certificates); (ii) To the best of such counsel's knowledge and other than as set forth in the Prospectus, there are no legal or governmental proceedings pending to which the Company or any of its subsidiaries is a party or of which any property of the Company or any of its subsidiaries is the subject which, if determined adversely to the Company or any of its subsidiaries, would individually or in the aggregate have a material adverse effect on the consolidated financial position, stockholders' equity or results of operations of the Company and its subsidiaries; and, to the best of such counsel's knowledge, no such proceedings are threatened; (iii) The issue and sale of the Designated Securities and the compliance by the Company with all of the provisions of the Designated Securities, the applicable Indenture, this Agreement and the Pricing Agreement with respect to the Designated Securities and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed or trust, loan agreement or other agreement or instrument known to such counsel to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, nor will such actions result in any violation of the provisions of the Restated Certificate of Incorporation or By-laws of the Company or any statute or any order, rule or regulation known to such counsel of any court or governmental agency or body having jurisdiction over the Company or any of its subsidiaries or of any of their properties, such as would be material to the business of the Company and its subsidiaries taken as a whole; (iv) No consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Designated 12 13 Securities or the consummation by the Company of the other transactions contemplated by this Agreement or such Pricing Agreement or the applicable Indenture, except such as have been obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Designated Securities by the Underwriters. In rendering the foregoing opinion such counsel may rely as to matters of law of the State of New Jersey upon the opinion of New Jersey counsel satisfactory to the Representatives, provided such counsel shall state therein that he believes that both the Underwriters and he are justified in relying upon such opinion. (d) Davis Polk & Wardwell, special counsel to the Company, shall have furnished to the Representatives their written opinion, dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus as amended or supplemented; (ii) This Agreement and any Pricing Agreement with respect to the Designated Securities have been duly authorized, executed and delivered by the Company; (iii) The Designated Securities have been duly authorized, executed, authenticated, issued and delivered and constitute valid and legally binding obligations of the Company entitled to the benefits provided by the applicable Indenture; and the Designated Securities and the Indentures conform to the descriptions thereof in the Prospectus as amended or supplemented; (iv) The applicable Indenture has been duly authorized, executed and delivered by the Company and constitutes a valid and legally binding instrument of the Company, enforceable in 13 14 accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; and each Indenture has been duly qualified under the Trust Indenture Act; and (v) The Registration Statement and the Prospectus as amended or supplemented and any further amendments and supplements thereto made by the Company prior to the Time of Delivery for the Designated Securities (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) comply as to form in all material respects with the requirements of the Act and the Trust Indenture Act and the rules and regulations thereunder; they have no reason to believe that, as of its effective date, the Registration Statement or any further amendment thereto made by the Company prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that, as of its date, the Prospectus as amended or supplemented or any further amendment or supplement thereto made by the Company prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contained an untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading or that, as of the Time of Delivery, either the Registration Statement or the Prospectus as amended or supplemented or any further amendment or supplement thereto made by the Company prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading; 14 15 In rendering the foregoing opinion such counsel may rely as to matters of law of the State of New Jersey upon the opinion of New Jersey counsel satisfactory to the Representatives, provided such counsel shall state therein that they believe that both the Underwriters and they are justified in relying upon such opinion. (e) At the Time of Delivery for such Designated Securities, the independent auditors of the Company who have certified the financial statements of the Company and its subsidiaries included or incorporated by reference in the Registration Statement shall have furnished to the Representatives a letter dated such Time of Delivery, to the effect set forth in Annex II hereto and as to such other matters as the Representatives may reasonably request, in form and substance satisfactory to the Representatives; (f) (i) Neither the Company nor any of its subsidiaries shall have sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus as amended or supplemented any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented, and (ii) since the respective dates as of which information is given in the Prospectus as amended or supplemented there shall not have been any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented, the effect of which, in any such case described in Clause (i) or (ii), is in the judgment of the Representatives so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Designated Securities on the terms and in the manner contemplated in the Prospectus as amended or supplemented; (g) On or after the date of the Pricing Agreement relating to the Designated Securities no downgrading shall have occurred in the rating accorded the Company's debt securities by Moody's Investors Service, Inc. or Standard & Poor's Corporation; 15 16 (h) On or after the date of the Pricing Agreement relating to the Designated Securities there shall not have occurred any of the following: (i) a suspension or material limitation in trading in securities generally on the New York Stock Exchange; (ii) a general moratorium on commercial banking activities in New York declared by either Federal or New York State authorities; or (iii) the engagement by the United States in hostilities which have resulted in the declaration, on or after the date of such Pricing Agreement, of a national emergency or war if the effect of any such event specified in this Clause (iii) in the judgment of the Representatives makes it impracticable or inadvisable to proceed with the public offering or the delivery of the Designated Securities on the terms and in the manner contemplated in the Prospectus as amended or supplemented; and (i) The Company shall have furnished or caused to be furnished to the Representatives at the Time of Delivery for the Designated Securities a certificate or certificates of officers of the Company satisfactory to the Representatives as to the accuracy in all material respects of the representations and warranties of the Company herein at and as of such Time of Delivery, as to the performance by the Company of all of its obligations hereunder to be performed at or prior to such Time of Delivery, as to the matters set forth in subsections (a) and (f) of this Section and as to such other matters as the Representatives may reasonably request. 8. (a) The Company will indemnify and hold harmless each Underwriter against any losses, claims, damages or liabilities to which such Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each Underwriter for any legal or other expenses reasonably incurred by such Underwriter in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that the Company shall not be liable in 16 17 any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company by any Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities; provided, however, that the foregoing indemnity agreement with respect to the Preliminary Prospectus shall not inure to the benefit of any Underwriter from whom the person asserting any such losses, claims, damages or liabilities purchased Securities, or any person controlling such Underwriter, if a copy of the Prospectus (as then amended or supplemented if the Company shall have furnished any amendments or supplements thereto) was not sent or given by or on behalf of such Underwriter to such person, if required by law so to have been delivered, at or prior to the written confirmation of the sale of the Securities to such person, and if the Prospectus (as so amended or supplemented) would have cured the defect giving rise to such losses, claims, damages or liabilities. (b) Each Underwriter will indemnify and hold harmless the Company, the officers and directors of the Company, and each person, if any, who controls the Company within the meaning of the Act, against any losses, claims, damages or liabilities to which the Company may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any such amendment or supplement in reliance upon and in conformity with written information 17 18 furnished to the Company by such Underwriter through the Representatives expressly for use therein; and will reimburse the Company for any legal or other expenses reasonably incurred by the Company in connection with investigating or defending any such action or claim as such expenses are incurred. (c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection. In case any such action shall be brought against any indemnified party it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. (d) If the indemnification provided for in this Section 8 is unavailable to or insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters of the Designated Securities on the other from the offering of the Designated Securities to which such loss, claim, damage or liability (or action in respect thereof) relates. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law or if the indemnified party failed to give the notice required under subsection (c) above, then each indemnifying party shall contribute to such 18 19 amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company on the one hand and the Underwriters of the Designated Securities on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and such Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from such offering (before deducting expenses) received by the Company bear to the total underwriting discounts and commissions received by such Underwriters. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on the one hand or such Underwriters on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to subsection (d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the applicable Designated Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The obligations of the Underwriters of Designated Securities in this subsection (d) to contribute are several in proportion to their respective underwriting obligations with respect to such Securities and not joint. 19 20 (e) The obligations of the Company under this Section 8 shall be in addition to any liability which the Company may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls any Underwriter within the meaning of the Act; and the obligations of the Underwriters under this Section 8 shall be in addition to any liability which the respective Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Company and to each person, if any, who controls the Company within the meaning of the Act. 9. (a) If any Underwriter shall default in its obligation to purchase the Designated Securities which it has agreed to purchase under the Pricing Agreement relating to such Designated Securities, the Representatives may in their discretion arrange for themselves or another party or other parties to purchase such Designated Securities on the terms contained herein. If within thirty-six hours after such default by any Underwriter the Representatives do not arrange for the purchase of such Designated Securities, then the Company shall be entitled to a further period of thirty-six hours within which to procure another party or other parties to whom the Representatives shall not unreasonably object to purchase such Designated Securities on such terms. In the event that, within the respective prescribed period, the Representatives notify the Company that they have so arranged for the purchase of such Designated Securities, or the Company notifies the Representatives that it has so arranged for the purchase of such Designated Securities, the Representatives or the Company shall have the right to postpone the Time of Delivery for such Designated Securities for a period of not more than seven days, in order effect whatever changes may thereby be made necessary in the Registration Statement or the Prospectus as amended or supplemented, or in any other documents or arrangements, and the Company agrees to file promptly any amendments or supplements to the Registration Statement or the Prospectus which in the opinion of the Representatives may thereby be made necessary. The term "Underwriter" as used in this Agreement shall include any person substituted under this Section with like effect as if such person had originally been a party to the Pricing Agreement with respect to such Designated Securities. (b) If, after giving effect to any arrangements for the purchase of the Designated Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company as provided in subsection (a) above, the aggregate principal amount of such Designated Securities which remains unpurchased does not exceed one- 20 21 eleventh of the aggregate principal amount of the Designated Securities, then the Company shall have the right to require each non-defaulting Underwriter to purchase the principal amount of Designated Securities which such Underwriter agreed to purchase under the Pricing Agreement relating to such Designated Securities and, in addition, to require each non-defaulting Underwriter to purchase its pro rata share (based on the principal amount of Designated Securities which such Underwriter agreed to purchase under such Pricing Agreement) of the Designated Securities of such defaulting Underwriter or Underwriters for which such arrangements have not been made; but nothing herein shall relieve a defaulting Underwriter from liability for its default. (c) If, after giving effect to any arrangements for the purchase of the Designated Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company as provided in subsection (a) above, the aggregate principal amount of Designated Securities which remains unpurchased exceeds one-eleventh of the aggregate principal amount of the Designated Securities, as referred to in subsection (b) above, or if the Company shall not exercise the right described in subsection (b) above to require non-defaulting Underwriters to purchase Designated Securities of a defaulting Underwriter or Underwriters, then the Pricing Agreement relating to such Designated Securities shall thereupon terminate, without liability on the part of any non- defaulting Underwriter or the Company, except for the expenses to be borne by the Company and the Underwriters as provided in Section 6 hereof and the indemnity and contribution agreements in Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from liability for its default. 10. The respective indemnities, agreements, representations, warranties and other statements of the Company and the several Underwriters, as set forth in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of any Underwriter or any controlling person of any Underwriter, or the Company, or any officer or director or controlling person of the Company, and shall survive delivery of and payment for the Securities. 11. If any Pricing Agreement shall be terminated pursuant to Section 9 hereof, the Company shall not then be under any liability to any Underwriter with respect to the Designated Securities covered by such Pricing Agreement except as provided in Section 6 and Section 8 hereof; but, 21 22 if for any other reason Designated Securities are not delivered by or on behalf of the Company as provided herein, the Company will reimburse the Underwriters through the Representatives for all out-of-pocket expenses approved in writing by the Representatives, including fees and disbursements of counsel, reasonably incurred by the Underwriters in making preparations for the purchase, sale and delivery of such Designated Securities, but the Company shall then be under no further liability to any Underwriter with respect to such Designated Securities except as provided in Section 6 and Section 8 hereof. 12. In all dealings hereunder, the Representatives of the Underwriters of Designated Securities shall act on behalf of each of such Underwriter, and the parties hereto shall be entitled to act and rely upon any statement, request, notice or agreement on behalf of any Underwriter made or given by such Representatives jointly or by such of the Representatives, if any, as may be designated for such purpose in the Pricing Agreement. All statements, requests, notices and agreements hereunder shall be in writing, and if to the Underwriters shall be delivered or sent by mail, telex or facsimile transmission to the address of the Representatives as set forth in the Pricing Agreement; and if to the Company shall be delivered or sent by mail, telex or facsimile transmission to the address of the Company set forth in the Registration Statement; provided, however, that any notice to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail, telex or facsimile transmission to such Underwriter at its address set forth in its Underwriters' Questionnaire, or telex constituting such Questionnaire, which address will be supplied to the Company by the Representatives upon request. Any such statements, requests, notices or agreements shall take effect upon receipt thereof. 13. This Agreement and each Pricing Agreement shall be binding upon, and inure solely to the benefit of, the Underwriters, the Company and, to the extent provided in Section 8 and Section 10 hereof, the officers and directors of the Company, and each person who controls the Company or any Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement or any such Pricing Agreement. No purchaser of any of the Securities from any Underwriter shall be deemed a successor or assign by reason merely of such purchase. 14. Time shall be of the essence of each Pricing Agreement. As used herein, "business day" shall mean any 22 23 day when the Commission's office in Washington, D.C. is open for business. 15. This Agreement and each Pricing Agreement shall be governed by and construed in accordance with the laws of the State of New York. 16. This Agreement and each Pricing Agreement may be executed by any one or more of the parties hereto and thereto in any number of counterparts, each of which shall be deemed to be an original, but all such respective counterparts shall together constitute one and the same instrument. If the foregoing is in accordance with your understanding, please sign and return to us ___ counterparts hereof. Very truly yours, THE CHUBB CORPORATION By:_______________________ Name: Title: Accepted as of the date hereof: [Name of Representative(s)] _______________________________ 23 24 ANNEX I Pricing Agreement [Name and Address of Representative(s)] ______________, 19__ Dear Sirs: The Chubb Corporation, a New Jersey corporation (the "Company"), proposes, subject to the terms and conditions stated herein and in the Underwriting Agreement, dated _____________, 199_ (the "Underwriting Agreement"), between the Company on the one hand and [Name of Representatives] on the other hand, to issue and sell to the Underwriters named in Schedule I hereto (the "Underwriters") the Securities specified in Schedule II hereto (the "Designated Securities"). Each of the provisions of the Underwriting Agreement is incorporated herein by reference in its entirety, and shall be deemed to be part of this Agreement to the same extent as if such provisions had been set forth in full herein; and each of the representations and warranties set forth therein shall be deemed to have been made at and as of the date of this Pricing Agreement, except that each representation and warranty which refers to the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a representation or warranty as of the date of the Underwriting Agreement in relation to the Prospectus (as therein defined), and also a representation and warranty as of the date of this Pricing Agreement in relation to the Prospectus as amended or supplemented relating to the Designated Securities which are the subject of this Pricing Agreement. Each reference to the Representatives herein and in the provisions of the Underwriting Agreement so incorporated by reference shall be deemed to refer to you. Unless otherwise defined herein, terms defined in the Underwriting Agreement are used herein as therein defined. The Representatives designated to act on behalf of the Representatives and on behalf of each of the Underwriters of the Designated Securities pursuant to Section 12 of the Underwriting Agreement and the address of the Representatives referred to in such Section 12 are set forth at the end of Schedule II hereto. Subject to the terms and conditions set forth herein and in the Underwriting Agreement incorporated herein 1 25 by reference, the Company agrees to issue and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not jointly, to purchase from the Company, at the time and place and at the purchase price to the Underwriters set forth in Schedule II hereto, the principal amount of Designated Securities set forth opposite the name of such Underwriter in Schedule I hereto. If the foregoing is in accordance with your understanding, please sign and return to us ________ counterparts hereof, and upon acceptance hereof by you, on behalf of each of the Underwriters, this letter and such acceptance hereof, including the provisions of the Underwriting Agreement incorporated herein by reference, shall constitute a binding agreement between each of the Underwriters and the Company. It is understood that your acceptance of this letter on behalf of each of the Underwriters is or will be pursuant to the authority set forth in a form of Agreement among Underwriters, the form of which shall be submitted to the Company for examination, upon request, but without warranty on the part of the Representatives as to the authority of the signers thereof. Very truly yours, THE CHUBB CORPORATION By_________________________ Name: Title: Accepted as of the date hereof: [Name of Representatives] __________________________ On behalf of each of the Underwriters 2 26 SCHEDULE I
Principal Amount of Designated Securities to be Underwriters Purchased ------------ ---------- [Names of Underwriters] . . . . . . . . . . . . . . $ ----------- Total . . . . . . . . . . . . . . $ ===========
1 27 SCHEDULE II Title of Designated Securities: [ %] [Floating Rate] [Zero Coupon] [Notes] [Debentures] due Aggregate Principal Amount: [$] Price to Public: % of the principal amount of the Designated Securities, plus accrued interest[, if any,] from [and accrued amortization, if any, from ] Purchase Price by Underwriters: % of the principal amount of the Designated Securities, plus accrued interest[, if any,] from ] [and accrued amortization, if any, from ] Specified funds for payment of purchase price: [New York] Clearing House funds Indenture and Ranking: The Designated Debt Securities will be [senior/subordinated] indebtedness of the Company issued under the [Senior/Subordinated] Indenture dated ________ __, 19__, between the Company and _______________, as Trustee Maturity: Interest Rate: [ %] [Zero Coupon] [See Floating Rate Provisions] Interest Payment Dates: [months and dates] 1 28 Redemption Provisions: [No provisions for redemption] [The Designated Securities may be redeemed, otherwise than through the sinking fund, in whole or in part at the option of the Company, [in the amount of [$] or an integral multiple thereof,] [on or after , at the following redemption prices (expressed in percentages of principal amount). If [redeemed on or before , %, and if] redeemed during the 12-month period beginning ,
Redemption Year Price ---- ----------
and thereafter] at 100% of their principal amount, together in each case with accrued interest to the redemption date] [on any interest payment date falling in or after , , at the election of the Company, at a redemption price equal to the principal amount thereof, plus accrued interest to the date of redemption.] [Other possible redemption provisions, such as mandatory redemption upon occurrence of certain events or redemption for changes in tax law] [Restriction on refunding] Sinking Fund Provisions: [No sinking fund provisions] [The Designated Securities are entitled to the benefit of a sinking fund to retire [$] principal amount of Designated Securities on in each of the years through at 100% of their principal amount plus accrued interest] [, together with [cumulative] [noncumulative] redemptions at the option of the Company to retire an additional [$] principal amount of Designated Securities in the years through at 100% of their principal amount plus accrued interest]. 2 29 [If Securities are extendable debt Securities, insert-- Extendable provisions: Securities are repayable on , [insert date and years], at the option of the holder, at their principal amount with accrued interest. Initial annual interest rate will be %, and thereafter annual interest rate will be adjusted on , and to a rate not less than % of the effective annual interest rate on U.S. Treasury obligations with -year maturities as of the [insert date 15 days prior to maturity date] prior to such [insert maturity date].] [If Securities are Floating Rate debt Securities, insert-- Floating rate provisions: Initial annual interest rate will be % through [and thereafter will be adjusted [monthly] [on each , , and ] [to an annual rate of % above the average rate for -year [month] [securities] [certificates of deposit] issued by and [insert names of banks].] [and the annual interest rate [thereafter] [from through ] will be the interest yield equivalent of the weekly average per annum market discount rate for -month Treasury bills plus % of Interest Differential (the excess, if any, of (i) then current weekly average per annum secondary market yield for -month certificates of deposit over (ii) then current interest yield equivalent of the weekly average per annum market discount rate for -month Treasury bills); [from and thereafter the rate will be the then current interest yield equivalent plus % of Interest Differential].] Defeasance provisions: Time of Delivery: Closing Location: Names and addresses of Representatives: Designated Representatives: 3 30 Address for Notices, etc.: [Other Terms]: 4 31 ANNEX II Pursuant to Section 7(e) of the Underwriting Agreement, the independent auditors shall furnish letters to the Underwriters to the effect that: (i) They are independent auditors with respect to the Company and its subsidiaries within the meaning of the Act and the applicable published rules and regulations thereunder; (ii) In their opinion, the financial statements and any supplementary financial information and schedules (and, if applicable, prospective financial statements and/or pro forma financial information) examined by them and included or incorporated by reference in the Registration Statement or the Prospectus comply as to form in all material respects with the applicable accounting requirements of the Act or the Exchange Act, as applicable, and the related published rules and regulations thereunder; and, if applicable, they have made a review in accordance with standards established by the American Institute of Certified Public Accountants of the consolidated interim financial statements, selected financial data, pro forma financial information, prospective financial statements and/or condensed financial statements derived from audited financial statements of the Company for the periods specified in such letter, as indicated in their reports thereon, copies of which have been furnished to the representatives of the Underwriters (the "Representatives"); (iii) The unaudited selected financial information with respect to the consolidated results of operations and financial position of the Company for the five most recent fiscal years included in the Prospectus and included or incorporated by reference in Item 6 of the Company's Annual Report on Form 10-K for the most recent fiscal year agrees with the corresponding amounts (after restatement where applicable) in the audited consolidated financial statements for five such fiscal years which were included or incorporated by reference in the Company's Annual Reports on Form 10-K for such fiscal years. (iv) On the basis of limited procedures, not constituting an audit in accordance with generally accepted auditing standards, consisting of a reading of the unaudited financial statements and other 1 32 information referred to below, a reading of the latest available interim financial statements of the Company and subsidiaries, inspection of the minute books of the Company and its subsidiaries since the date of the latest audited financial statements included or incorporated by reference in the Prospectus, inquiries of officials of the Company and its subsidiaries responsible for financial and accounting matters and such other inquiries and procedures as may be specified in such letter, nothing came to their attention that caused them to believe that: (A) the unaudited condensed consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Company's Quarterly Reports on Form 10-Q incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Exchange Act as it applies to Form 10-Q and the related published rules and regulations thereunder or are not in conformity with generally accepted accounting principles applied on a basis substantially consistent with the basis for the audited consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; (B) any other unaudited income statement data and balance sheet items included in the Prospectus do not agree with the corresponding items in the unaudited consolidated financial statements from which such data and items were derived, and any such unaudited data and items were not determined on a basis substantially consistent with the basis for the corresponding amounts in the audited consolidated financial statements included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; (C) the unaudited financial statements which were not included in the Prospectus but from which were derived the unaudited condensed financial statements referred to in Clause (A) and any unaudited income statement data and balance sheet items included in the Prospectus and referred to in Clause (B) were not determined on a basis 2 33 substantially consistent with the basis for the audited financial statements included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; (D) any unaudited pro forma consolidated condensed financial statements included or incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Act and the published rules and regulations thereunder or the pro forma adjustments have not been properly applied to the historical amounts in the compilation of those statements; (E) as of a specified date not more than five days prior to the date of such letter, there have been any changes in the consolidated capital stock (other than issuances of capital stock of the Company upon exercise of options and stock appreciation rights, upon earn-outs of performance shares and upon conversions of convertible securities, in each case which were outstanding on the date of the latest balance sheet included or incorporated by reference in the Prospectus) or in the combined net case reserves with respect to the business managed by Chubb & Son Inc., or any increase in the consolidated long-term debt or in notes and mortgages payable of the Company and its subsidiaries, or any decreases in the aggregate market value of the 15 largest holdings of equity securities of the Company and its property and casualty insurance subsidiaries, combined net premiums receivable with respect to the business managed by Chubb & Son Inc. or other items specified by the Representatives, or any increases in any items specified by the Representatives, in each case as compared with amounts as of the date of the latest balance sheet included or incorporated by reference in the Prospectus, except in each case for changes, increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (F) for the period from the date of the latest financial statements included or incorporated by reference in the Prospectus to the specified date referred to in Clause (E) there were any decreases in combined net premiums with 3 34 respect to the business managed by Chubb & Son Inc. or in the investment income of the Company and its property and casualty insurance subsidiaries or any increases in the combined net loss and loss adjustment expenses incurred (exclusive of changes in incurred but not reported losses) with respect to the business managed by Chubb & Son Inc. or any increases or decreases in any items specified by the Representatives, in each case as compared with the comparable period of the preceding year and with the preceding period of corresponding length specified by the Representatives, except in each case for increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (v) In addition to the audit referred to in their report(s) included or incorporated by reference in the Prospectus and the limited procedures, inspection of minute books, inquiries and other procedures referred to in paragraphs (iii) and (iv) above, they have carried out certain specified procedures, not constituting an examination in accordance with generally accepted auditing standards, with respect to certain amounts, percentages and financial information specified by the Representatives which are derived from the general accounting records of the Company and its subsidiaries, which appear in the Prospectus (excluding documents incorporated by reference), or in Part II of or in exhibits and schedules to, the Registration Statement specified by the Representatives or in documents incorporated by reference in the Prospectus specified by the Representatives, and have compared certain of such amounts, percentages and financial information with the amounts included in or which can be derived from audited financial statements or with the accounting records of the Company and its subsidiaries and have found them to be in agreement. All references in this Annex II to the Prospectus shall be deemed to refer to the Prospectus (including the documents incorporated by reference therein) as defined in the Underwriting Agreement as of the date of the letter delivered on the date of the Pricing Agreement for purposes of such letter and to the Prospectus as amended or supplemented (including the documents incorporated by reference therein) in relation to the applicable Designated Securities for purposes of the letter delivered at the Time of Delivery for such Designated Securities. 4 EX-1.2 3 UNDERWRITING AGREEMENT - GUARANTEED DEBT SECUR. 1 Exhibit 1.2 CHUBB CAPITAL CORPORATION Debt Securities --------------- Underwriting Agreement _____________, 19__ [Name(s) and address(es) of Representatives.] Dear Sirs/Mesdames: From time to time Chubb Capital Corporation, a New Jersey corporation (the "Company") and The Chubb Corporation, a New Jersey corporation, as guarantor (the "Guarantor"), propose to enter into one or more Pricing Agreements (each a "Pricing Agreement") in the form of Annex I hereto, with such additions and deletions as the parties thereto may determine, and, subject to the terms and conditions stated herein and therein, to issue and sell to the firms named in Schedule I to the applicable Pricing Agreement (such firms constituting the "Underwriters" with respect to such Pricing Agreement and the securities specified therein) certain of the Company's (i) senior debt securities (the "Senior Securities") issued pursuant to the senior indenture dated October 25, 1989 (the "Senior Indenture") between the Company, The Chubb Corporation, as Guarantor, and The First National Bank of Chicago, as Trustee, and (ii) subordinated debt securities (the "Subordinated Securities") issued pursuant to the subordinated indenture dated ______, 199_ between the Company, The Chubb Corporation, as Guarantor, and The First National Bank of Chicago, as Trustee, (the "Subordinated Indenture") (the Senior Securities together with the Subordinated Securities, the "Securities") specified in Schedule II to such Pricing Agreement (with respect to such Pricing Agreement, the "Designated Securities"). The Securities are to be unconditionally guaranteed (the 2 "Guarantees") as to payment of principal, premium, if any, and interest by the Guarantor upon the basis and on the terms specified in the applicable Indenture. The terms and rights of any particular issuance of Designated Securities shall be as specified in the Pricing Agreement relating thereto and in or pursuant to the applicable Indenture identified in such Pricing Agreement. 1. Particular sales of Designated Securities may be made from time to time to the Underwriters of such Securities, for whom the firms designated as representatives of the Underwriters of such Securities in the Pricing Agreement relating thereto will act as representatives (the "Representatives"). The term "Representatives" also refers to a single firm acting as sole representative of the Underwriters and to Underwriters who act without any firm being designated as their representative. This Underwriting Agreement shall not be construed as an obligation of the Company or the Guarantor to sell any of the Securities (including the Guarantees) or as an obligation of any of the Underwriters to purchase the Securities (including the Guarantees). The obligation of the Company and the Guarantor to issue and sell any of the Securities (including the Guarantees) and the obligation of any of the Underwriters to purchase any of the Securities (including the Guarantees) shall be evidenced by the Pricing Agreement with respect to the Designated Securities specified therein. Each Pricing Agreement shall specify the aggregate principal amount of such Designated Securities, the initial public offering price of such Designated Securities, the purchase price to the Underwriters of such Designated Securities, the names of the Underwriters of such Designated Securities, the names of the Representatives of such Underwriters and the principal amount of such Designated Securities to be purchased by each Underwriter and shall set forth the date, time and manner of delivery of such Designated Securities and payment therefor. The Pricing Agreement shall also specify (to the extent not set forth in the applicable Indenture and the registration statement and prospectus with respect thereto) the terms of such Designated Securities. A Pricing Agreement shall be in the form of an executed writing (which may be in counterparts), and may be evidenced by an exchange of telegraphic communications or any other rapid transmission device designed to produce a written record of communications transmitted. The obligations of the Underwriters under this Agreement and each Pricing Agreement shall be several and not joint. 2 3 2. The Company and the Guarantor jointly and severally represent and warrant to, and agree with, each of the Underwriters that: (a) A registration statement in respect of the Securities and the Guarantees has been filed with the Securities and Exchange Commission (the "Commission"); such registration statement and any post-effective amendment thereto, each in the form heretofore delivered or to be delivered to the Representatives and, excluding exhibits to such registration statement, but including all documents incorporated by reference in the prospectus contained therein, to the Representatives for each of the other Underwriters have been declared effective by the Commission in such form; no other document with respect to such registration statement or document incorporated by reference therein has heretofore been filed or transmitted for filing with the Commission; and no stop order suspending the effectiveness of such registration statement has been issued and no proceeding for that purpose has been initiated or threatened by the Commission (any preliminary prospectus included in such registration statement or filed with the Commission pursuant to Rule 424(a) of the rules and regulations of the Commission under the Securities Act of 1933, as amended (the "Act"), being hereinafter called a "Preliminary Prospectus"; the various parts of such registration statement, including all exhibits thereto and the documents incorporated by reference in the prospectus contained in the registration statement, at the time such part of the registration statement became effective but excluding Form T-1, each as amended at the time such part of the registration statement became effective, being hereinafter called the "Registration Statement"; the prospectus relating to the Securities, in the form in which it has most recently been filed, or transmitted for filing, with the Commission on or prior to the date of this Agreement, being hereinafter called the "Prospectus"; any reference herein to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to the applicable form under the Act, as of the date of such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after the date of such Preliminary Prospectus or Prospectus, as the case may be, under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), 3 4 and incorporated by reference in such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment to the Registration Statement shall be deemed to refer to and include any annual report of the Company and the Guarantor filed pursuant to Section 13(a) or 15(d) of the Exchange Act after the effective date of the Registration Statement that is incorporated by reference in the Registration Statement; and any reference to the Prospectus as amended or supplemented shall be deemed to refer to the Prospectus as amended or supplemented in relation to the applicable Designated Securities in the form in which it is filed with the Commission pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof, including any document incorporated by reference therein as of the date of such filing); (b) The documents incorporated by reference in the Prospectus, when they became effective or were filed with the Commission, as the case may be, complied as to form in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and none of such documents contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading; and any further documents so filed and incorporated by reference in the Prospectus or any further amendment or supplement thereto, when such documents become effective or are filed with the Commission, as the case may be, will comply as to form in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company or the Guarantor by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities and such Guarantees; (c) The Registration Statement and the Prospectus comply as to form, and any further amendments or supplements to the Registration Statement or the 4 5 Prospectus will comply as to form, in all material respects to the requirements of the Act and the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") and the rules and regulations of the Commission thereunder and do not and will not, as of the applicable effective date as to the Registration Statement and any amendment thereto and as of the applicable filing date as to the Prospectus and any amendment or supplement thereto, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company or the Guarantor by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities and such Guarantees; (d) Neither the Guarantor nor any of its subsidiaries has sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus any loss or interference with their businesses from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, which loss or interference would have a material adverse effect on the business or financial condition of the Guarantor and its subsidiaries taken as a whole, otherwise than as set forth or contemplated in the Prospectus; and, since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has not been any material adverse change, or any development involving a prospective material adverse change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Guarantor and its subsidiaries taken as a whole, otherwise than as set forth or contemplated in the Prospectus; (e) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus and has been duly qualified as a foreign corporation for the transaction of business in each other jurisdiction in which it owns 5 6 or leases property, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of the failure to be so qualified in any such jurisdiction; (f) All of the issued shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable and are owned directly or indirectly by the Guarantor; (g) The Guarantor has been duly incorporated and is validly existing as a corporation under the laws of the jurisdiction of its incorporation with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus and has been duly qualified as a foreign corporation for the transaction of business in each other jurisdiction in which it owns or leases property, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of the failure to be so qualified in any such jurisdiction; (h) The Securities have been duly authorized, and, when Designated Securities are issued and delivered pursuant to this Agreement and any Pricing Agreement with respect to such Designated Securities, such Designated Securities will have been duly executed authenticated, issued and delivered and will constitute valid and legally binding obligations of the Company entitled to the benefits provided by the applicable Indenture, which will be substantially in the form incorporated by reference as an exhibit to the Registration Statement; the Guarantees have been duly authorized, and, upon due execution, authentication and delivery of the Securities and the placement of the Guarantees thereon, the Guarantees will have been duly executed, issued and delivered and will constitute valid and binding obligations of the Guarantor entitled to the benefits provided by the applicable Indenture; each Indenture has been duly authorized and duly qualified under the Trust Indenture Act and, at the Time of Delivery for such Designated Securities (as defined in Section 4 hereof), each Indenture will constitute a valid and legally binding instrument, enforceable in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; and each Indenture conforms, and the Designated Securities and the Guarantees will 6 7 conform, to the descriptions thereof contained in the Prospectus as amended or supplemented with respect to such Designated Securities and such Guarantees; (i) The issue and sale of the Securities and the Guarantees and the compliance by the Company and the Guarantor with all of the provisions of the Securities, the Guarantees, the Indentures, this Agreement and any Pricing Agreement, and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Guarantor or any of its subsidiaries is a party or by which the Company, the Guarantor or any of its subsidiaries is bound or to which any of the property or assets of the Company, the Guarantor or any of its subsidiaries is subject, nor will such action result in any violation of the provisions of the Certificate of Incorporation or By-Laws of the Company or the Restated Certificate of Incorporation or By-Laws of the Guarantor or any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company, the Guarantor or any of its subsidiaries or any of their properties except for such conflicts, breaches, violations or defaults which would not have a material adverse effect on the business, financial condition or results of operations of the Guarantor and its subsidiaries taken as a whole or on the Company's or Guarantor's ability to perform their respective obligations under this Agreement, the Securities and the Guarantees; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Securities and the Guarantees or the consummation by the Company or the Guarantor of the other transactions contemplated by this Agreement or any Pricing Agreement or the Indentures, except such as have been, or will have been prior to the Time of Delivery, obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Securities and the Guarantees by the Underwriters; and (j) Other than as set forth in the Prospectus, there are no legal or governmental proceedings pending (including proceedings of any insurance regulatory 7 8 authority) to which the Guarantor or any of its subsidiaries is a party or of which any property of the Guarantor or any of its subsidiaries is the subject which, if determined adversely to the Guarantor or any of its subsidiaries, would individually or in the aggregate have a material adverse effect on the consolidated financial position, stockholders' equity or results of operations of the Guarantor and its subsidiaries; and, to the best of the Company's and the Guarantor's knowledge, no such proceedings are threatened. 3. Upon the execution of the Pricing Agreement applicable to any Designated Securities and authorization by the Representatives of the release of such Designated Securities, the several Underwriters propose to offer such Designated Securities for sale upon the terms and conditions set forth in the Prospectus as amended or supplemented. 4. Designated Securities to be purchased by each Underwriter pursuant to the Pricing Agreement relating thereto, in definitive form to the extent practicable and with the Guarantees placed thereon, and in such authorized denominations and registered in such names as the Representatives may request upon at least forty-eight hours' prior notice to the Company, shall be delivered by or on behalf of the Company to the Representatives for the account of such Underwriter, against payment by such Underwriter or on its behalf of the purchase price therefor by certified or official bank check or checks, payable to the order of the Company in the funds specified in such Pricing Agreement, all at the place and time and date specified in such Pricing Agreement or at such other place and time and date as the Representatives and the Company may agree upon in writing, such time and date being herein called the "Time of Delivery" for such Securities. 5. Each of the Company and the Guarantor agrees with each of the Underwriters of any Designated Securities: (a) To prepare the Prospectus as amended and supplemented in relation to the applicable Designated Securities in a form approved by the Representatives and to file such Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's close of business on the second business day following the execution and delivery of the Pricing Agreement relating to the applicable Designated Securities or, if applicable, such earlier time as may be required by Rule 424(b); to make no further amendment or any supplement to the Registration Statement or Prospectus 8 9 as amended or supplemented after the date of the Pricing Agreement relating to such Securities and prior to the Time of Delivery for such Securities which shall be disapproved by the Representatives for such Securities promptly after reasonable notice thereof, and such disapproval shall not be unreasonable; to advise the Representatives promptly of any such amendment or supplement after such Time of Delivery and furnish the Representative with copies thereof; to file promptly all reports and any definitive proxy or information statements required to be filed by the Company or the Guarantor with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the delivery of a prospectus is required in connection with the offering or sale of such Securities, and during such same period to advise the Representatives, promptly after it received notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to the Prospectus or any amended Prospectus has been filed with the Commission, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any prospectus relating to the Securities, of the suspension of the qualification of such Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information; and, in the event of the issuance of any such stop order or of any such order preventing or suspending the use of any prospectus relating to the Securities or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal; (b) Promptly from time to time to take such action as the Representatives may reasonably request to qualify such Securities for offering and sale under the securities laws of such jurisdictions as the Representatives may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of such Securities, provided that in connection therewith neither the Company nor the Guarantor shall be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction; 9 10 (c) To furnish the Underwriters with copies of the Prospectus as amended or supplemented in such quantities as the Representatives may from time to time reasonably request, and, if the delivery of a prospectus is required at any time in connection with the offering or sale of the Securities and if at such time any event shall have occurred as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or, if for any other reason it shall be necessary during such period to amend or supplement the Prospectus or to file under the Exchange Act any document incorporated by reference in the Prospectus in order to comply with the Act, the Exchange Act or the Trust Indenture Act, to notify the Representatives and upon their request to file such document and to prepare and furnish without charge to each Underwriter and to any dealer in securities as many copies as the Representatives may from time to time reasonably request of an amended Prospectus or a supplement to the Prospectus which will correct such statement or omission or effect such compliance; (d) To make generally available to their respective securityholders as soon as practicable, but in any event not later than eighteen months after the effective date of the Registration Statement (as defined in Rule 158(c)), an earnings statement of the Guarantor and its subsidiaries (which need not be audited) complying with Section 11(a) of the Act and the rules and regulations of the Commission thereunder (including at the option of the Company Rule 158); and (e) During the period beginning from the date of the Pricing Agreement for such Designated Securities and continuing to and including the earlier of (i) the termination of trading restrictions for such Designated Securities, as notified to the Company and the Guarantor by the Representatives and (ii) the Time of Delivery for such Designated Securities, not to offer, sell, contract to sell or otherwise dispose of any debt securities of the Company or the Guarantor, or guaranteed by the Guarantor, which debt securities mature more than one year after such Time of Delivery and which are substantially similar to such Designated Securities, without the prior written consent of the Representatives. 10 11 6. Each of the Company and the Guarantor covenants and agrees with the several Underwriters that the Company and the Guarantor will pay or cause to be paid the following: (i) the reasonable fees, disbursements and expenses of the Company's and the Guarantor's counsel and independent auditors in connection with the registration of the Securities and the Guarantees under the Act and all other expenses in connection with the preparation, printing and filing of the Registration Statement, any Preliminary Prospectus and the Prospectus and amendments and supplements thereto and the mailing and delivering of copies thereof to the Underwriters and dealers; (ii) the cost of producing any Agreement among Underwriters, this Agreement, any Pricing Agreement, the Indentures, any Blue Sky Memoranda and any other documents in connection with the offering, purchase, sale and delivery of the Securities and the Guarantees; (iii) all expenses in connection with the qualification of the Securities and the Guarantees for offering and sale under state securities laws as provided in section 5(b) hereof, including the fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky surveys; (iv) any fees charged by securities rating services for rating the Securities and the Guarantees; (v) any filing fees incident to any required review by the National Association of Securities Dealers, Inc. of the terms of the sale of the Securities and the Guarantees; (vi) the cost of preparing the Securities and the Guarantees; (vii) the reasonable fees and expenses of any Trustee and any agent of any Trustee and the fees and disbursements of counsel for any Trustee in connection with any Indenture and the Securities and the Guarantees; and (viii) all other costs and expenses incident to the performance of its obligations hereunder which are not otherwise specifically provided for in this section. It is understood, however, that, except as provided in this Section, Section 8 and Section 11 hereof, the Underwriters will pay all of their own costs and expenses, including the fees of their counsel, transfer taxes on resale of any of the Securities by them, and any advertising expenses connected with any offers they may make. 7. The obligations of the Underwriters of any Designated Securities under the Pricing Agreement relating to such Designated Securities shall be subject, in the discretion of the Representatives, to the condition that all representations and warranties and other statements of the Company and the Guarantor in or incorporated by reference in the Pricing Agreement relating to such Designated Securities are, at and as of the Time of Delivery for such Designated Securities, true and correct in all material respects, the condition that the Company and the Guarantor shall have 11 12 performed all of their obligations hereunder theretofore to be performed, and the following additional conditions: (a) The Prospectus as amended or supplemented in relation to the applicable Designated Securities shall have been filed with the Commission pursuant to Rule 424(b) within the applicable time period prescribed for such filing by the rules and regulations under the Act and in accordance with Section 5(a) hereof; no stop order suspending the effectiveness of the Registration Statement or any part thereof shall have been issued and no proceeding for that purpose shall have been initiated or threatened by the Commission; and all requests for additional information on the part of the Commission shall have been complied with to the Representatives' reasonable satisfaction; (b) Counsel for the Underwriters shall have furnished to the Representatives such opinion or opinions, dated the Time of Delivery for such Designated Securities, with respect to the validity of the applicable Indenture, the Designated Securities, the Guarantees, the Registration Statement, the Prospectus as amended or supplemented and other related matters as the Representatives may reasonably request, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters; (c) Robert Rusis, Senior Vice President and General Counsel of the Guarantor shall have furnished to the Representatives his written opinion, dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) Each of the Company and the Guarantor has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each foreign jurisdiction in which it owns or leases property, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of failure to be so qualified in any such jurisdiction (such counsel being entitled to rely in respect of the opinion in this clause upon opinions of local counsel and in respect of matters of fact upon certificates of officers of the Guarantor or its subsidiaries, provided that such counsel shall state that he believes that both the 12 13 Representatives and he are justified in relying upon such opinions and certificates); (ii) To the best of such counsel's knowledge and other than as set forth in the Prospectus there are no legal or governmental proceedings pending to which the Guarantor or any of its subsidiaries is a party or of which any property of the Guarantor or any of its subsidiaries is the subject which, if determined adversely to the Guarantor or any of its subsidiaries, would individually or in the aggregate have a material adverse effect on the consolidated financial position, stockholders' equity or results of operations of the Guarantor and its subsidiaries; and, to the best of such counsel's knowledge, no such proceedings are threatened; (iii) The issue and sale of the Designated Securities, including the Guarantees, and the compliance by the Company and the Guarantor with all of the provisions of the Designated Securities, the Guarantees, the applicable Indenture, this Agreement and the Pricing Agreement with respect to the Designated Securities and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed or trust, loan agreement or other agreement or instrument known to such counsel to which the Guarantor or any of its subsidiaries is a party or by which the Guarantor or any of its subsidiaries is bound or to which any of the property or assets of the Guarantor or any of its subsidiaries is subject, nor will such actions result in any violation, of the provisions of the Certificate of Incorporation or By-laws of the Company, the Restated Certificate of Incorporation or By-Laws of the Guarantor or any statute or any order, rule or regulation known to such counsel of any court or governmental agency or body having jurisdiction over the Guarantor or any of its subsidiaries or of any of their properties, such as would be material to the business of the Company or the Guarantor and their subsidiaries taken as a whole; (iv) No consent, approval, authorization order, registration or qualification of or with 13 14 any such court or governmental agency or body is required for the issue and sale of the Designated Securities or the issue of the Guarantees or the consummation by the Company of the other transactions contemplated by this Agreement or such Pricing Agreement or the applicable Indenture, except such as have been obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Designated Securities by the Underwriters; In rendering the foregoing opinion such counsel may rely as to matters of law of the State of New Jersey upon the opinion of New Jersey counsel satisfactory to the Representatives, provided such counsel shall state therein that he believes that both the Underwriters and he are justified in relying upon such opinion. (d) Davis Polk & Wardwell, special counsel for the Company, shall have furnished to the Representatives their written opinion, dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) Each of the Company and the Guarantor has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus as amended or supplemented; (ii) This Agreement and any Pricing Agreement with respect to the Designated Securities have been duly authorized, executed and delivered by the Company and the Guarantor; (iii) The Designated Securities have been duly authorized, executed, authenticated, issued and delivered and constitute valid and legally binding obligations of the Company entitled to the benefits provided by the applicable Indenture; and the Designated Securities, the Guarantees and the Indentures conform to the descriptions thereof in the Prospectus as amended or supplemented; 14 15 (iv) The Guarantees have been duly authorized, and, when the Securities have been executed, authenticated, delivered in accordance with the applicable Indenture and paid for pursuant to this Agreement, will constitute valid and binding obligations of the Guarantor entitled to the benefits provided by the applicable Indenture subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; (v) The applicable Indenture has been duly authorized, executed and delivered by the Company and the Guarantor and constitutes a valid and legally binding instrument of the Company and the Guarantor, enforceable in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditor's rights and to general equity principles; and each Indenture has been duly qualified under the Trust Indenture Act; (vi) The Company is exempt from all provisions of the Investment Company Act; and (vii) The Registration Statement and the Prospectus as amended or supplemented and any further amendments and supplements thereto made by the Company and the Guarantor prior to the Time of Delivery for the Designated Securities (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) comply as to form in all material respects with the requirements of the Act and the Trust Indenture Act and the rules and regulations thereunder; they have no reason to believe that, as of its effective date, the Registration Statement or any further amendment thereto made by the Company and the Guarantor prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that, as of its date, the Prospectus as amended or supplemented or any 15 16 further amendment or supplement thereto made by the Company prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contained an untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading or that, as of the Time of Delivery, either the Registration Statement or the Prospectus as amended or supplemented or any further amendment or supplement thereto made by the Company and the Guarantor prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading; In rendering the foregoing opinion such counsel may rely as to matters of law of the State of New Jersey upon the opinion of New Jersey counsel satisfactory to the Representatives, provided such counsel shall state therein that they believe that both the Underwriters and they are justified in relying upon such opinion. (e) At the Time of Delivery for such Designated Securities, the independent auditors of the Guarantor who have certified the financial statements of the Guarantor and its subsidiaries included or incorporated by reference in the Registration Statement shall have furnished to the Representatives a letter, dated such Time of Delivery, to the effect set forth in Annex II hereto, and as to such other matters as the Representatives may reasonably request, and in form and substance satisfactory to the Representatives; (f) (i) Neither the Guarantor nor any of its subsidiaries shall have sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus as amended or supplemented any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute [or court] or governmental action, order or decree, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented, and (ii) since the respective dates as of which information is given in the Prospectus as amended or supplemented 16 17 there shall not have been any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Guarantor and its subsidiaries, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented, the effect of which, in any such case described in Clause (i) or (ii), is in the judgment of the Representatives so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Designated Securities (including the Guarantees) on the terms and in the manner contemplated in the Prospectus as amended or supplemented; (g) On or after the date of the Pricing Agreement relating to the Designated Securities no downgrading shall have occurred in the rating accorded the Company's or the Guarantor's debt securities by Moody's Investors Service, Inc. or Standard & Poor's Corporation; (h) On or after the date of the Pricing Agreement relating to the Designated Securities there shall not have occurred any of the following: (i) a suspension or material limitation in trading in securities generally on the New York Stock Exchange; (ii) a general moratorium on commercial banking activities in New York declared by either Federal or New York State authorities; or (iii) the engagement by the United States in hostilities which have resulted in the declaration, on or after the date of such Pricing Agreement, of a national emergency or war if the effect of any such event specified in this Clause (iii) in the judgment of the Representatives makes it impracticable or inadvisable to proceed with the public offering or the delivery of the Designated Securities (including the Guarantees) on the terms and in the manner contemplated in the Prospectus as amended or supplemented; and (i) The Company and the Guarantor shall have furnished or caused to be furnished to the Representatives at the Time of Delivery for the Designated Securities a certificate or certificates of officers of the Company and the Guarantor satisfactory to the Representatives as to the accuracy in all material respects of the representations and warranties of the Company and the Guarantor herein at and as of such Time of Delivery, as to the performance by the Company and the Guarantor of all of its obligations 17 18 hereunder to be performed at or prior to such Time of Delivery, as to the matters set forth in subsections (a) and (f) of this Section and as to such other matters as the Representatives may reasonably request. 8. (a) The Company and the Guarantor will jointly and severally indemnify and hold harmless each Underwriter against any losses, claims, damages or liabilities, to which such Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities or the Guarantees, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each Underwriter for any legal or other expenses reasonably incurred by such Underwriter in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company and the Guarantor by any Underwriter of Designated Securities through the Representatives expressly for use in the prospectus as amended or supplemented relating to such Securities or such Guarantees; provided, however, that the foregoing indemnity agreement with respect to the Preliminary Prospectus shall not inure to the benefit of any Underwriter from whom the person asserting any such losses, claims, damages or liabilities purchased Securities, or any person controlling such Underwriter, if a copy of the Prospectus (as then amended or supplemented if the Company shall have furnished any amendments or supplements thereto) was not sent or given by or on behalf of such Underwriter to such person, if required by law so to have been delivered, at or prior to the written confirmation of the sale of the Securities to such person, and if the Prospectus (as so amended or supplemented) would have cured the defect giving rise to such losses, claims, damages or liabilities. 18 19 (b) Each Underwriter will indemnify and hold harmless the Company, the Guarantor, the officers and directors of the Company and the Guarantor, and each person, if any, who controls the Company or the Guarantor within the meaning of the Act, against any losses, claims, damages or liabilities to which the Company or the Guarantor may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities or the Guarantees, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company and the Guarantor by such Underwriter through the Representatives expressly for use therein; and will reimburse the Company or the Guarantor for any legal or other expenses reasonably incurred by the Company or the Guarantor in connection with investigating or defending any such action or claim as such expenses are incurred. (c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection. In case any such action shall be brought against any indemnified party it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, after notice from 19 20 the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. (d) If the indemnification provided for in this Section 8 is unavailable to or insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Company and the Guarantor on the one hand and the Underwriters of the Designated Securities on the other from the offering of the Designated Securities (including the Guarantees) to which such loss, claim, damage or liability (or action in respect thereof) relates. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law or if the indemnified party failed to give the notice required under subsection (c) above, then each indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company and the Guarantor on the one hand and the Underwriters of the Designated Securities on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Company and the Guarantor on the one hand and such Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from such offering (before deducting expenses) received by the Company and the Guarantor bear to the total underwriting discounts and commissions received by such Underwriters. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company and the Guarantor on the one hand or such Underwriters on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company, the Guarantor and the Underwriters agree that it would not be just and equitable if contribution pursuant to subsection 20 21 (d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the applicable Designated Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The obligations of the Underwriters of Designated Securities in this subsection (d) to contribute are several in proportion to their respective underwriting obligations with respect to such Securities and not joint. (e) The obligations of the Company and the Guarantor under this Section 8 shall be in addition to any liability which the Company and the Guarantor may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls any Underwriter within the meaning of the Act; and the obligations of the Underwriters under this Section 8 shall be in addition to any liability which the respective Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Company or the Guarantor and to each person, if any, who controls the Company or the Guarantor within the meaning of the Act. 9. (a) If any Underwriter shall default in its obligation to purchase the Designated Securities which it has agreed to purchase under the Pricing Agreement relating to such Designated Securities, the Representatives may in their discretion arrange for themselves or another party or other parties to purchase such Designated Securities on the terms contained herein. If within thirty-six hours after such default by any Underwriter the Representatives do not arrange for the purchase of such Designated Securities, then the Company shall be entitled to a further period of thirty-six hours within which to procure another party or 21 22 other parties to whom the Representatives shall not unreasonably object to purchase such Designated Securities on such terms. In the event that, within the respective prescribed period, the Representatives notify the Company and the Guarantor that they have so arranged for the purchase of such Designated Securities, or the Company and the Guarantor the Representatives that it has so arranged for the purchase of such Designated Securities, the Representatives or the Company and the Guarantor shall have the right to postpone the Time of Delivery for such Designated Securities for a period of not more than seven days, in order to effect whatever changes may thereby be made necessary in the Registration Statement or the Prospectus as amended or supplemented, or in any other documents or arrangements, and the Company and the Guarantor agree to file promptly any amendments or supplements to the Registration Statement or the Prospectus which in the opinion of the Representatives may thereby be made necessary. The term "Underwriter" as used in this Agreement shall include any person substituted under this Section with like effect as if such person had originally been a party to the Pricing Agreement with respect to such Designated Securities. (b) If, after giving effect to any arrangements for the purchase of the Designated Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company and the Guarantor as provided in subsection (a) above, the aggregate principal amount of such Designated Securities which remains unpurchased does not exceed one-eleventh of the aggregate principal amount of the Designated Securities, then the Company shall have the right to require each non-defaulting Underwriter to purchase the principal amount of Designated Securities which such Underwriter agreed to purchase under the Pricing Agreement relating to such Designated Securities and, in addition, to require each non-defaulting Underwriter to purchase its pro rata share (based on the principal amount of Designated Securities which such Underwriter agreed to purchase under such Pricing Agreement) of the Designated Securities of such arrangements have not been made; but nothing herein shall relieve a defaulting Underwriter from liability for its default. (c) If, after giving effect to any arrangements for the purchase of the Designated Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company and the Guarantor as provided in subsection (a) above, the aggregate principal amount of Designated Securities which remains unpurchased exceeds one-eleventh of the aggregate principal amount of 22 23 the Designated Securities, as referred to in subsection (b) above, or if the Company and the Guarantor shall not exercise the right described in subsection (b) above to require non-defaulting Underwriters to purchase Designated Securities of a defaulting Underwriter or Underwriters, then the Pricing Agreement relating to such Designated Securities shall thereupon terminate, without liability on the part of any non-defaulting Underwriter or the Company or the Guarantor, except for the expenses to be borne by the Company, the Guarantor and the Underwriters as provided in Section 6 hereof and the indemnity and contribution agreements in Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from liability for its default. 10. The respective indemnities, agreements, representations, warranties and other statements of the Company, the Guarantor and the several Underwriters, as set forth in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of any Underwriter or any controlling person of any Underwriter, or the Company, the Guarantor or any officer or director or controlling person of the Company or the Guarantor, and shall survive delivery of and payment for the Securities. 11. If any Pricing Agreement shall be terminated pursuant to Section 9 hereof, the Company and the Guarantor shall not then be under any liability to any Underwriter with respect to the Designated Securities covered by such Pricing Agreement except as provided in Section 6 and Section 8 thereof; but, if for any reason Designated Securities are not delivered by or on behalf of the Company and the Guarantor as provided herein, the Company and the Guarantor will reimburse the Underwriters through the Representatives for all out-of-pocket expenses approved in writing by the Representatives, including fees and disbursements of counsel, reasonably incurred by the Underwriters in making preparations for the purchase, sale and delivery of such Designated Securities, but the Company and the Guarantor shall then be under no further liability to any Underwriter with respect to such Designated Securities except as provided in Section 6 and Section 8 hereof. 12. In all dealings hereunder, the Representatives of the Underwriters of Designated Securities shall act on behalf of each of such Underwriter, and the parties hereto shall be entitled to act and rely upon any 23 24 statement, request, notice or agreement on behalf of any Underwriter made or given by such Representatives jointly or by such of the Representatives, if any, as may be designated for such purpose in the Pricing Agreement. All statements, requests, notices and agreements hereunder shall be in writing, and if to the Underwriters shall be delivered or sent by mail, telex or facsimile transmission to the address of the Representatives as set forth in the Pricing Agreement; and if to the Company shall be delivered or sent by mail, telex or facsimile transmission to the address of the Company or the Guarantor set forth in the Registration Statement; provided, however, that any notice to an Underwriter pursuant to section 8(c) hereof shall be delivered or sent by mail, telex or facsimile transmission to such Underwriter at its address set forth in its Underwriters' Questionnaire, or telex constituting such Questionnaire, which address will be supplied to the Company by the Representatives upon request. Any such statements, requests, notices or agreements shall take effect upon receipt thereof. 13. This Agreement and each Pricing Agreement shall be binding upon, and inure solely to the benefit of, the Underwriters, the Company, the Guarantor and, to the extent provided in Section 8 and Section 10 hereof, the officers and directors of the Company, the Guarantor and each person who controls the Company and the Guarantor or any Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement or any such Pricing Agreement. No purchaser of any of the Securities from any Underwriter shall be deemed a successor or assign by reason merely of such purchase. 14. Time shall be of the essence of each Pricing Agreement. As used herein, "business day" shall mean any day when the Commission's office in Washington, D.C. is open for business. 15. This Agreement and each Pricing Agreement shall be governed by and construed in accordance with the laws of the State of New York. 16. This Agreement and each Pricing Agreement may be executed by any one or more of the parties hereto and thereto in any number of counterparts, each of which shall be deemed to be an original, but all such respective counterparts shall together constitute one and the same instrument. 24 25 If the foregoing is in accordance with your understanding, please sign and return to us ___ counterparts hereof. Very truly yours, CHUBB CAPITAL CORPORATION By:__________________________ Name: Title: THE CHUBB CORPORATION By:__________________________ Name: Title: Accepted as of the date hereof: By: ____________________________ Name: Title: 25 26 ANNEX I Pricing Agreement [Name and Address of Representative(s)] __________, 19__ Dear Sirs: Chubb Capital Corporation, a New Jersey corporation (the "Company"), proposes, subject to the terms and conditions stated herein and in the Underwriting Agreement, dated _______, 199_ (the "Underwriting Agreement"), between the Company and The Chubb Corporation (the "Guarantor") on the one hand and _________________________________ on the other hand, to issue and sell to the Underwriters named in Schedule I hereto (the "Underwriters") the Securities specified in Schedule II hereto (the "Designated Securities"). Each of the provisions of the Underwriting Agreement is incorporated herein by reference in its entirety, and shall be deemed to be a part of this Agreement to the same extent as if such provisions had been set forth in full herein; and each of the representations and warranties set forth therein shall be deemed to have been made at and as of the date of this Pricing Agreement, except that each representation and warranty which refers to the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a representation or warranty as of the date of the Underwriting Agreement in relation to the Prospectus (as therein defined), and also a representation and warranty as of the date of this Pricing Agreement in relation to the Prospectus as amended or supplemented relating to the Designated Securities which are the subject of this Pricing Agreement. Each reference to the Representatives herein and in the provisions of the Underwriting Agreement so incorporated by reference shall be deemed to refer to you. Unless otherwise defined herein, terms defined in the Underwriting Agreement are used herein as therein defined. The Representatives designated to act on behalf of the representatives and on behalf of each of the Underwriters of the Designated Securities pursuant to Section 12 of the Underwriting Agreement and the address of 1 27 the representatives referred to in such Section 12 are set forth at the end of Schedule II hereto. Subject to the terms and conditions set forth herein and in the Underwriting Agreement incorporated herein by reference, the Company agrees to issue and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not jointly, to purchase from the Company, at the time and place and at the purchase price to the Underwriters set forth in Schedule II hereto, the principal amount of Designated Securities set forth opposite the name of such Underwriter in Schedule I hereto. If the foregoing is in accordance with your understanding, please sign and return to us ___ counterparts hereof, and upon acceptance hereof by you, on behalf of each of the Underwriters, this letter and such acceptance hereof, including the provisions of the Underwriting Agreement incorporated herein by reference, shall constitute a binding agreement between each of the Underwriters, the Company and the Guarantor. It is understood that your acceptance of this letter on behalf of each of the Underwriters is or will be pursuant to the authority set forth in a form of Agreement among Underwriters, the form of which shall be submitted to the Company and the Guarantor for examination, upon request, but without warranty on the part of the Representatives as to the authority of the signers thereof. Very truly yours, CHUBB CAPITAL CORPORATION By:______________________ Name: Title: THE CHUBB CORPORATION By:______________________ Name: Title: Accepted as of the date hereof: [Name of Representatives] 2 28 _______________________________ On behalf of each of the Underwriters 3 29 SCHEDULE I
Principal Amount of Designated Securities to be Underwriters Purchased ------------ ---------- [Names of Underwriters] . . . . . . . . . . . $ ------------ Total . . . . . . . . . . . . . $ ============
1 30 SCHEDULE II Title of Designated Securities: [ %] [Floating Rate] [Zero Coupon] [Notes] [Debentures] due Aggregate Principal Amount: [$] Price to Public: % of the principal amount of the Designated Securities, plus accrued interest[, if any,] from [and accrued amortization, if any, from ] Purchase Price by Underwriters: % of the principal amount of the Designated Securities, plus accrued interest[, if any,] from ] [and accrued amortization, if any, from ] Specified funds for payment of purchase price: [New York] Clearing House funds Indenture and Ranking: The Designated Debt Securities will be [senior/subordinated] indebtedness of the Company issued under the [Senior/Subordinated] Indenture dated ________ __, 19__, between the Company, the Guarantor and _______________, as Trustee Guarantees: The Designated Securities will be unconditionally guaranteed as to payment of principal, premium, if any, and interest by the Guarantors Maturity: Interest Rate: [ %] [Zero Coupon] [See Floating Rate Provisions] 1 31 Interest Payment Dates: [months and dates] 2 32 Redemption Provisions: [No provisions for redemption] [The Designated Securities may be redeemed, otherwise than through the sinking fund, in whole or in part at the option of the Company, [in the amount of [$] or an integral multiple thereof,] [on or after , at the following redemption prices (expressed in percentages of principal amount). If [redeemed on or before , and if] redeemed during the 12-month period beginning
Redemption Year Price ---- ----------
and thereafter] at 100% of their principal amount, together in each case with accrued interest to the redemption date.] [on any interest payment date falling in or after , at the election of the Company, at a redemption price equal to the principal amount thereof, plus accrued interest to the date of redemption.] [Other possible redemption provisions, such as mandatory redemption upon occurrence of certain events or redemption for changes in tax law] [Restriction on refunding] Sinking Fund Provisions: [No sinking fund provisions] [The Designated Securities are entitled to the benefit of a sinking fund to retire [$] principal amount of Designated Securities on in each of the years through at 100% of their principal amount plus accrued interest] [, together with [cumulative] [noncumulative] redemptions at the option of the Company to retire an additional [$] principal amount of Designated Securities in the years through at 100% of their principal amount plus accrued interest]. 3 33 [If Securities are extendable debt Securities, insert-- Extendable provisions: Securities are repayable on , [insert date and years], at the option of the holder, at their principal amount with accrued interest. Initial annual interest rate will be % , and thereafter annual interest rate will be adjusted on , and to a rate not less than % of the effective annual interest rate on U.S. Treasury obligations with -year maturities as of the [insert date 15 days prior to maturity date] prior to such [interest maturity date].] [If Securities are Floating Rate debt Securities, insert-- Floating rate provisions: Initial annual interest rate will be % through [and thereafter will be adjusted [monthly] [on each , and ] [to an annual rate of % above the average rate for -year [month] [securities] [certificates of deposit] issued by and [insert names of banks].] [and the annual interest rate [thereafter] [from through ] will be the interest yield equivalent of the weekly average per annum market discount rate for -month Treasury bills plus % of Interest Differential (the excess, if any, of (i) then current weekly average per annum secondary market yield for -month certificates of deposit over (ii) then current interest yield equivalent of the weekly average per annum market discount rate for -month Treasury bills); [from and thereafter the rate will be the then current interest yield equivalent plus % of Interest Differential].] Defeasance provisions: Time of Delivery: Closing Location: Names and addresses of representatives: Designated Representatives: Address for Notices, etc.: 4 34 [Other Terms]: 5 35 ANNEX II Pursuant to Section 7 (e) of the Underwriting Agreement, the independent auditors shall furnish letters to the Underwriters to the effect that: (i) They are independent auditors with respect to the Guarantor and its subsidiaries within the meaning of the Act and the applicable published rules and regulations thereunder; (ii) In their opinion, the financial statements and any supplementary financial information and schedules (and, if applicable, prospective financial statements and/or pro forma financial information) examined by them and included or incorporated by reference in the Registration Statement or the Prospectus comply as to form in all material respects with the applicable accounting requirements of the Act or the Exchange Act, as applicable, and the related published rules and regulations thereunder; and, if applicable, they have made a review in accordance with standards established by the American Institute of Certified Public Accountants of the consolidated interim financial statements, selected financial data, pro forma financial information, prospective financial statements and/or condensed financial statements derived from audited financial statements of the Guarantor for the periods specified in such letter, as indicated in their reports thereon, copies of which have been furnished to the representatives of the Underwriters (the "Representatives"): (iii) The unaudited selected financial information with respect to the consolidated results of operations and financial position of the Guarantor for the five most recent fiscal years included in the Prospectus and included or incorporated by reference in Item 6 of the Guarantor's Annual Report on Form 10-K for the most recent fiscal year agrees with the corresponding amounts (after restatement where applicable) in the audited consolidated financial statements for five such fiscal years which were included or incorporated by reference in the Guarantor's Annual Reports on Form 10-K for such fiscal years; 1 36 (iv) On the basis of limited procedures, not constituting an audit in accordance with generally accepted auditing standards, consisting of a reading of the unaudited financial statements and other information referred to below, a reading of the latest available interim financial statements of the Guarantor and its subsidiaries, inspection of the minute books of the Guarantor and its subsidiaries since the date of the latest audited financial statements included or incorporated by reference in the Prospectus, inquiries of officials of the Guarantor and its subsidiaries responsible for financial and accounting matters and such other inquiries and procedures as may be specified in such letter, nothing came of their attention that caused them to believe that: (A) the unaudited condensed consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Guarantor's Quarterly Reports on Form 10-Q incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Exchange Act as it applies to Form 10-Q and the related published rules and regulations thereunder or are not in conformity with generally accepted accounting principles applied on a basis substantially consistent with the basis for the audited consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Guarantor's Annual Report on Form 10-K for the most recent fiscal year; (B) any other unaudited income statement data and balance sheet items included in the Prospectus do not agree with the corresponding items in the unaudited consolidated financial statements from which such data and items were derived, and any such unaudited data and items were not determined on a basis substantially consistent with the basis for the corresponding amounts in the audited consolidated financial statements included or incorporated by reference in the Guarantor's Annual Report on Form 10-K for the most recent fiscal year; (C) the unaudited financial statements which were not included in the Prospectus but from which 2 37 were derived the unaudited condensed financial statements referred to in clause (A) and any unaudited income statement data and balance sheet items included in the Prospectus and referred to in Clause (B) were not determined on a basis substantially consistent with the basis for the audited financial statements included or incorporated by reference in the Guarantor's Annual Report on Form 10-K for the most recent fiscal year; (D) any unaudited pro forma consolidated condensed financial statements included or incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Act and the published rules and regulations thereunder or the pro forma adjustments have not been properly applied to the historical amounts in the compilation of those statements; (E) as of a specified date not more than five days prior to the date of such letter, there have been any changes in the consolidated capital stock (other than issuances of capital stock of the Company upon exercise of options and stock appreciation rights, upon earn-outs of performance shares and upon conversions of convertible securities, in each case which were outstanding on the date of the latest balance sheet included or incorporated by reference in the Prospectus) or in the combined net case reserves with respect to the business managed by Chubb & Son Inc., or any increase in the consolidated long-term debt or in notes and mortgages payable of the Guarantor and its subsidiaries, combined net premiums receivable with respect to the business managed by Chubb & Son Inc. or other items specified by the Representatives, or any increases in any items specified by the Representatives, in each case as compared with amounts as of the date of the latest balance sheet included or incorporated by reference in the Prospectus, except in each case for changes, increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (F) for the period from the date of the latest financial statements included or incorporated by reference in the Prospectus to the specified date referred to in Clause (E) there 3 38 were any decreases in combined net premiums with respect to the business managed by Chubb & Son Inc. or in the investment income of the Guarantor and its property and casualty insurance subsidiaries or any increases in the combined net loss and loss adjustment expenses incurred (exclusive of changes in incurred but not reported losses) with respect to the business managed by Chubb & Son Inc. or any increases or decreases in any items specified by the Representatives, in each case as compared with the comparable period of corresponding length specified by the Representatives, except in each case for increases and decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (v) In addition to the audit referred to in their report(s) included or incorporated by reference in the Prospectus and the limited procedures, inspection of minute books, inquiries and other procedures referred to in paragraphs (iii) and (iv) above, they have carried out certain specified procedures, not constituting an examination in accordance with generally accepted auditing standards, with respect to certain amounts, percentages and financial information specified by the Representatives which are derived from the general accounting records of the Guarantor and its subsidiaries, which appear in the Prospectus (excluding documents incorporated by reference) or in Part II of, or in exhibits and schedules to, the Registration Statement specified by the Representatives or in documents incorporated by reference in the Prospectus specified by the Representatives, and have compared certain of such amounts, percentages and financial information with the amounts included in or which can be derived from audited financial statements or with the accounting records of the Guarantor and its subsidiaries and have found them to be in agreement. All references in this Annex II to the Prospectus shall be deemed to refer to the Prospectus (including the documents incorporated by reference therein) as defined in the Underwriting Agreement as of the date of the letter delivered on the date of the Pricing Agreement for purposes of such letter and to the Prospectus as amended or supplemented (including the documents incorporated by reference therein) in relation to the applicable Designated Securities for purposes of the letter delivered at the Time of Delivery for such Designated Securities. 4 EX-1.3 4 UNDERWRITING AGREEMENT - COMMON STOCK, ... 1 Exhibit 1.3 THE CHUBB CORPORATION COMMON STOCK, PAR VALUE $__ PER SHARE, PREFERRED STOCK, WITHOUT PAR VALUE AND CONVERTIBLE DEBT SECURITIES _________ Underwriting Agreement __________, 19__ [Name(s) and address(es) of Representatives.] Dear Sirs/Mesdames: From time to time The Chubb Corporation, a New Jersey corporation (the "Company"), proposes to enter into one or more Pricing Agreements (each a "Pricing Agreement") in the form of Annex I hereto, with such additions and deletions as the parties thereto may determine, and, subject to the terms and conditions stated herein and therein, to issue and sell to the firms named in Schedule I to the applicable Pricing Agreement (such firms constituting the "Underwriters" with respect to such Pricing Agreement and the securities specified therein) certain of its (i) shares of common stock, par value $1.00 per share ("Common Stock"), (ii) convertible debt securities issued pursuant to the indenture dated ______, 199_ between the Company and The First National Bank of Chicago, as Trustee, (the "Indenture"), which may be convertible into Common Stock (the "Convertible Debt Securities") (iii) shares of preferred stock, without par value (the "Preferred Stock"), including shares of preferred stock which may be convertible into shares of Common Stock (the "Convertible Preferred Stock"), (together with the Preferred Stock, the "Offered Preferred Stock") and/or (iv) depositary shares representing shares of Offered Preferred Stock (the "Depositary Shares" and, together with the Offered Preferred Stock, the "Shares") in any such case, as specified in Schedule II to such Pricing Agreement. The Convertible Debt Securities, the Common Stock, the Offered Preferred Stock and the 2 Depositary Shares are collectively referred to herein as the "Securities". With respect to any Pricing Agreement, the Convertible Debt Securities, Common Stock, Offered Preferred Stock and Depositary Shares to which such Pricing Agreement relates are referred to as Designated Convertible Debt Securities, Designated Common Stock, Designated Offered Preferred Stock and Designated Depositary Shares, respectively and collectively as the "Designated Securities." If the Prospectus (as defined in Section 2(a)) and Pricing Agreement so provide, the Offered Preferred Stock will be deposited by the Company against delivery of receipts (the "Depositary Receipts") to be issued by the depositary (the "Depositary") named in the deposit agreement, (the "Deposit Agreement"), between the Company, the Depositary and the holders from time to time of the Depositary Receipts issued thereunder and evidencing Designated Depositary Shares. Each Designated Depositary Share will represent the number of or fraction of the number of deposited shares of Offered Preferred Stock specified in the applicable Prospectus and in Schedule II to such Pricing Agreement. The terms and rights of any particular issuance of Designated Securities shall be as specified in the Pricing Agreement relating thereto, and with respect to the Convertible Debt Securities, in or pursuant to the Indenture identified in such Pricing Agreement. 1. Particular sales of Designated Securities may be made from time to time to the Underwriters of such Securities, for whom the firms designated as representatives of the Underwriters of such Securities in the Pricing Agreement relating thereto will act as representatives (the "Representatives"). The term "Representatives" also refers to a single firm acting as sole representative of the Underwriters and to Underwriters who act without any firm being designated as their representative. This Underwriting Agreement shall not be construed as an obligation of the Company to sell any of the Securities or as an obligation of any of the Underwriters to purchase the Securities. The obligation of the Company to issue and sell any of the Securities and the obligation of any of the Underwriters to purchase any of the Securities shall be evidenced by the Pricing Agreement with respect to the Designated Securities specified therein. Each Pricing Agreement shall specify the aggregate principal amount of such Designated Securities, the initial public offering price of such Designated Securities, the purchase price to the Underwriters of such Designated Securities, the names of the Underwriters of such Designated Securities, the names of the Representatives of such Underwriters and the principal amount of such 2 3 Designated Securities to be purchased by each Underwriter and shall set forth the date, time and manner of delivery of such Designated Securities and payment therefor. The Pricing Agreement shall also specify (to the extent not set forth in the Indenture or Deposit Agreement and the registration statement and prospectus with respect thereto) the terms of such Designated Securities. A Pricing Agreement shall be in the form of an executed writing (which may be in counterparts), and may be evidenced by an exchange of telegraphic communications or any other rapid transmission device designed to produce a written record of communications transmitted. The obligations of the Underwriters under this Agreement and each Pricing Agreement shall be several and not joint. 2. The Company represents and warrants to, and agrees with, each of the Underwriters that: (a) A registration statement in respect of the Securities (including any Common Stock issuable upon conversion of other Securities) has been filed with the Securities and Exchange Commission (the "Commission"); such registration statement and any post-effective amendment thereto, each in the form heretofore delivered or to be delivered to the Representatives and, excluding exhibits to such registration statement, but including all documents incorporated by reference in the prospectus contained therein, to the Representatives for each of the other Underwriters have been declared effective by the Commission in such form; no other document with respect to such registration statement or document incorporated by reference therein has heretofore been filed or transmitted for filing with the Commission; and no stop order suspending the effectiveness of such registration statement has been issued and no proceeding for that purpose has been initiated or threatened by the Commission (any preliminary prospectus included in such registration statement or filed with the Commission pursuant to Rule 424(a) of the rules and regulations of the Commission under the Securities Act of 1933, as amended (the "Act"), being hereinafter called a "Preliminary Prospectus"; the various parts of such registration statement, including all exhibits thereto and the documents incorporated by reference in the prospectus contained in the registration statement, at the time such part of the registration statement became effective but excluding Form T-1, each as amended at the time such part of the registration statement became effective, being hereinafter called the "Registration Statement"; the prospectus relating to the Securities, 3 4 in the form in which it has most recently been filed, or transmitted for filing, with the Commission on or prior to the date of this Agreement, being hereinafter called the "Prospectus"; any reference herein to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to the applicable form under the Act, as of the date of such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after the date of such Preliminary Prospectus or Prospectus, as the case may be, under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and incorporated by reference in such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment to the Registration Statement shall be deemed to refer to and include any annual report of the Company filed pursuant to Section 13(a) or 15(d) of the Exchange Act after the effective date of the Registration Statement that is incorporated by reference in the Registration Statement; and any reference to the Prospectus as amended or supplemented shall be deemed to refer to the Prospectus as amended or supplemented in relation to the applicable Designated Securities in the form in which it is filed with the Commission pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof, including any documents incorporated by reference therein as of the date of such filing); (b) The documents incorporated by reference in the Prospectus, when they became effective or were filed with the Commission, as the case may be, complied as to form in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and none of such documents contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading; and any further documents so filed and incorporated by reference in the Prospectus or any further amendment or supplement thereto, when such documents become effective or are filed with the Commission, as the case may be, will comply as to form in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder and will not contain an untrue statement of a material fact or omit to state a 4 5 material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities; (c) The Registration Statement and the Prospectus comply as to form, and any further amendments or supplements to the Registration Statement or the Prospectus will comply as to form, in all material respects to the requirements of the Act and the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") and the rules and regulations of the Commission thereunder and do not and will not, as of the applicable effective date as to the Registration Statement and any amendment thereto and as of the applicable filing date as to the Prospectus and any amendment or supplement thereto, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities; (d) Neither the Company nor any of its subsidiaries has sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, which loss or interference would have a material adverse effect on the business or financial condition of the Company and its subsidiaries taken as a whole, otherwise than as set forth or contemplated in the Prospectus; and, since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has not been any material adverse change, or any development involving a prospective material adverse change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the 5 6 Company and its subsidiaries, otherwise than as set forth or contemplated in the Prospectus; (e) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus and has been duly qualified as a foreign corporation for the transaction of business in each other jurisdiction in which it owns or leases property, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of the failure to be so qualified in any such jurisdiction; (f) When Designated Convertible Debt Securities are issued and delivered pursuant to this Agreement and the applicable Pricing Agreement (1) such Designated Convertible Debt Securities will have been duly authorized, executed, authenticated, issued and delivered and will constitute valid and legally binding obligations of the Company entitled to the benefits provided by the Indenture; (2) the Indenture will have been duly authorized and duly qualified under the Trust Indenture Act and will constitute a valid and legally binding agreement of the Company; and (3) the Indenture will conform, and the Designated Convertible Debt Securities will conform, to the descriptions thereof contained in the Prospectus as amended or supplemented with respect to such Convertible Debt Securities; (g) When Designated Common Stock is issued and delivered pursuant to this Agreement and the applicable Pricing Agreement (1) such Designated Common Stock will be duly and validly authorized and issued and fully paid and non- assessable; and (2) the Common Stock and the Designated Common Stock will conform to the descriptions thereof contained in the Prospectus as amended or supplemented with respect to such Designated Common Stock; (h) When shares of Common Stock are initially issued upon conversion of any Convertible Preferred Stock or Convertible Debt Securities, as the case may be, such Common Stock will have been duly and validly authorized and reserved for issuance and, when issued and delivered in accordance with the provisions of the relevant Securities, will be duly and validly issued, fully paid and non-assessable and will conform to the description of the Common Stock contained in the 6 7 Prospectus as amended or supplemented with respect to such relevant Securities; (i) When Designated Offered Preferred Stock is issued and delivered pursuant to this Agreement and the applicable Pricing Agreement; (1) such Designated Offered Preferred Stock will be duly and validly authorized and issued and fully paid and non-assessable; (2) when Depositary Receipts evidencing any Designated Depositary Shares are issued and delivered against deposit of Designated Offered Preferred Stock and against payment therefor pursuant to this Agreement, the applicable Pricing Agreement and the Deposit Agreement, the Depositary Receipts will be legally issued and will entitle the holders thereof to the rights specified in the Depositary Receipts and the Deposit Agreement; and (3) the Designated Offered Preferred Stock and any Designated Depositary Shares will conform to the descriptions thereof contained in the Prospectus as amended or supplemented with respect to such Designated Offered Preferred Stock and/or Designated Depositary Shares; (j) When Designated Depositary Shares are issued, the Deposit Agreement will have been duly authorized by the Company and, assuming due authorization, execution and delivery by the Depositary, the Deposit Agreement will constitute a valid and binding agreement of the Company and will conform to the description thereof contained in the Prospectus as amended or supplemented with respect to such Designated Depositary Shares; (k) The issue and sale of the Designated Securities (and any Common Stock into which the Designated Securities may be convertible) and the compliance by the Company with all of the provisions of the Securities, the Indenture, this Agreement, any Pricing Agreement and the Deposit Agreement (to the extent such provisions are applicable in connection with such issue and sale of Securities), and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, nor will such action result in any violation of the provisions of the Restated 7 8 Certificate of Incorporation or By-laws of the Company or any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its subsidiaries or any of their properties except for such conflicts, breaches, violations or defaults which would not have a material adverse effect on the business, financial condition or results of operations of the Company and its subsidiaries taken as a whole or the Company's ability to perform its obligations under this Agreement and the Securities; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Securities or the consummation by the Company of the transactions contemplated by this Agreement or any Pricing Agreement, the Indenture or the Deposit Agreement, if applicable, except such as have been, or will have been prior to the Time of Delivery, obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Securities by the Underwriters; and (l) Other than as set forth in the Prospectus, there are no legal or governmental proceedings pending (including proceedings of any insurance regulatory authority) to which the Company or any of its subsidiaries is a party or of which any property of the Company or any of its subsidiaries is the subject which, if determined adversely to the Company or any of its subsidiaries, would individually or in the aggregate have a material adverse effect on the consolidated financial position, stockholders' equity or results of operations of the Company and its subsidiaries; and, to the best of the Company's knowledge, no such proceedings are threatened. 3. Upon the execution of the Pricing Agreement applicable to any Designated Securities and authorization by the Representatives of the release of such Designated Securities, the several Underwriters propose to offer such Designated Securities for sale upon the terms and conditions set forth in the Prospectus as amended or supplemented. 4. Designated Securities to be purchased by each Underwriter pursuant to the Pricing Agreement relating thereto, in definitive form to the extent practicable, and in such authorized denominations and registered in such 8 9 names as the Representatives may request upon at least forty-eight hours' prior notice to the Company, shall be delivered by or on behalf of the Company to the Representatives for the account of such Underwriter, against payment by such Underwriter or on its behalf of the purchase price therefor by certified or official bank check or checks, payable to the order of the Company in the funds specified in such Pricing Agreement, all at the place and time and date specified in such Pricing Agreement or at such other place and time and date as the Representatives and the Company may agree upon in writing, such time and date being herein called the "Time of Delivery" for such Securities. 5. The Company agrees with each of the Underwriters of any Designated Securities: (a) To prepare the Prospectus as amended and supplemented in relation to the applicable Designated Securities in a form approved by the Representatives and to file such Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's close of business on the second business day following the execution and delivery of the Pricing Agreement relating to the applicable Designated Securities or, if applicable, such earlier time as may be required by Rule 424(b); to make no further amendment or any supplement to the Registration Statement or Prospectus as amended or supplemented after the date of the Pricing Agreement relating to such Securities and prior to the Time of Delivery for such Securities which shall be disapproved by the Representatives for such Securities promptly after reasonable notice thereof, and such disapproval shall not be unreasonable; to advise the Representatives promptly of any such amendment or supplement after such Time of Delivery and furnish the Representatives with copies thereof; to file promptly all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the delivery of a prospectus is required in connection with the offering or sale of such Securities, and during such same period to advise the Representatives, promptly after it received notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to the Prospectus or any amended Prospectus has been filed with the Commission, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any prospectus relating to the Securities, of the suspension of the qualification of 9 10 such Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information; and, in the event of the issuance of any such stop order or of any such order preventing or suspending the use of any prospectus relating to the Securities, of the suspension of the qualification of such Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information; and, in the event of the issuance of any such stop order or of any such order preventing or suspending the use of any prospectus relating to the Securities or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal; (b) Promptly from time to time to take such action as the Representatives may reasonably request to qualify such Securities for offering and sale under the securities laws of such jurisdictions as the Representatives may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of such Securities, provided that in connection therewith the Company shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction; (c) To furnish the Underwriters with copies of the Prospectus as amended or supplemented in such quantities as the Representatives may from time to time reasonably request, and, if the delivery of a prospectus is required at any time in connection with the offering or sale of the Securities and if at such time any event shall have occurred as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or, if for any other reason it shall be necessary during such same period to amend or supplement the Prospectus or to file under the Exchange Act any document incorporated by reference in the Prospectus in order to comply with the Act, the Exchange Act or the Trust Indenture Act, to 10 11 notify the Representatives and upon their request to file such document and to prepare and furnish without charge to each Underwriter and to any dealer in securities as many copies as the Representatives may from time to time reasonably request of an amended Prospectus or a supplement to the Prospectus which will correct such statement or omission or effect such compliance; (d) To make generally available to its securityholders as soon as practicable, but in any event not later than eighteen months after the effective date of the Registration Statement (as defined in Rule 158(c)), an earnings statement of the Company and its subsidiaries (which need not be audited) complying with Section 11(a) of the Act and the rules and regulations of the Commission thereunder (including at the option of the Company Rule 158); and (e) During the period beginning from the date of the Pricing Agreement for such Designated Securities and continuing to and including the earlier of (i) the termination of trading restrictions for such Designated Securities, as notified to the Company by the Representatives and (ii) the Time of Delivery for such Designated Securities, not to offer, sell, contract to sell or otherwise dispose of any securities of the Company which are substantially similar to such Designated Securities or any securities convertible or exercisable for securities which are substantially similar to such Designated Securities, without the prior written consent of the Representatives other than the grant of options or issuance of Common Stock upon the exercise of options, granted under plans in existence at the date of the Pricing Agreement. (f) To reserve and keep available at all times, free of preemptive rights, shares of Common Stock for the purpose of enabling the Company to satisfy any obligations to issue shares of its Common Stock upon conversion of the Convertible Preferred Stock or the Convertible Debt Securities, 6. The Company covenants and agrees with the several Underwriters that the Company will pay or cause to be paid the following: (i) the reasonable fees, disbursements and expenses of the Company's counsel and independent auditors in connection with the registration of the Securities under the Act and all other expenses in connection with the preparation, printing and filing of the Registration Statement, any Preliminary Prospectus and the 11 12 Prospectus and amendments and supplements thereto and the mailing and delivering of copies thereof to the Underwriters and dealers; (ii) the cost of producing any Agreement among Underwriters, this Agreement, any Pricing Agreement, any Indenture, any Deposit Agreement, any Blue Sky Memoranda and any other documents in connection with the offering, purchase, sale and delivery of the Securities; (iii) all expenses in connection with the qualification of the Securities for offering and sale under state securities laws as provided in section 5(b) hereof, including the fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky surveys; (iv) any fees charged by securities rating services for rating the Securities; (v) any filing fees incident to any required review by the National Association of Securities Dealers, Inc. of the terms of the sale of the Securities; (vi) the cost of preparing the Securities; (vii) the cost and charges of any transfer agent or registrar or dividend disbursing agent; (viii) any cost of preparing Depositary Receipts evidencing Depositary Shares and the delivery of any Depositary Shares to the Underwriters; (ix) the costs and expenses of the deposit of Offered Preferred Stock under any Deposit Agreement in exchange for Depositary Receipts issued thereunder, including the charges of the Depositary in connection therewith; (x) to the extent set forth in any Deposit Agreement, the fees of the Depositary and any agent appointed under the Deposit Agreement; (xi) the reasonable fees and expenses of any Trustee and any agent of any Trustee and the fees and disbursements of counsel for any Trustee in connection with any Indenture and the Securities; and (xii) all other costs and expenses incident to the performance of its obligations hereunder which are not otherwise specifically provided for in this Section. It is understood, however, that, except as provided in this Section, Section 8 and Section 11 hereof, the Underwriters will pay all of their own costs and expenses, including the fees of their counsel, transfer taxes on resale of any of the Securities by them, and any advertising expenses connected with any offers they may make. 7. The obligations of the Underwriters of any Designated Securities under the Pricing Agreement relating to such Designated Securities shall be subject, in the discretion of the Representatives, to the condition that all representations and warranties and other statements of the Company in or incorporated by reference in the Pricing Agreement relating to such Designated Securities are, at and as of the Time of Delivery for such Designated Securities, true and correct in all material respects, the condition that the Company shall have performed all of its obligations 12 13 hereunder theretofore to be performed, and the following additional conditions: (a) The Prospectus as amended or supplemented in relation to the applicable Designated Securities shall have been filed with the Commission pursuant to Rule 424(b) within the applicable time period prescribed for such filing by the rules and regulations under the Act and in accordance with Section 5(a) hereof; no stop order suspending the effectiveness of the Registration Statement or any part thereof shall have been issued and no proceeding for that purpose shall have been initiated or threatened by the Commission; and all requests for additional information on the part of the Commission shall have been complied with to the Representatives' reasonable satisfaction; (b) Counsel for the Underwriters shall have furnished to the Representatives such opinion or opinions, dated the Time of Delivery for such Designated Securities, with respect to the validity of the Indenture, if applicable, the Deposit Agreement, if applicable, the Designated Securities (and any other Securities issuable upon conversion of the Designated Securities), the Registration Statement, the Prospectus as amended or supplemented and other related matters as the Representatives may reasonably request, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters; (c) Robert Rusis, Senior Vice President and General Counsel of the Company shall have furnished to the Representatives his written opinion, dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) The Company has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each foreign jurisdiction in which it owns or leases property, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of failure to be so qualified in any such jurisdiction (such counsel being entitled to rely in respect of the opinion in this clause upon opinions of local counsel and in respect of matters of fact upon certificates of officers of the Company or its subsidiaries, provided that 13 14 such counsel shall state that he believes that both the Representatives and he are justified in relying upon such opinions and certificates); (ii) To the best of such counsel's knowledge and other than as set forth in the Prospectus, there are no legal or governmental proceedings pending to which the Company or any of its subsidiaries is a party or of which any property of the Company or any of its subsidiaries is the subject which, if determined adversely to the Company or any of its subsidiaries, would individually or in the aggregate have a material adverse effect on the consolidated financial position, stockholders' equity or results of operations of the Company and its subsidiaries; and, to the best of such counsel's knowledge, no such proceedings are threatened; (iii) The issue and sale of the Designated Securities (and any other Securities for which the Designated Securities may be convertible) and the compliance by the Company with all of the provisions of the Designated Securities, the Indenture, this Agreement and the Pricing Agreement with respect to the Designated Securities and the Deposit Agreement (to the extent such provisions are applicable in connection with such issue and sale of Designated Securities) and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed or trust, loan agreement or other agreement or instrument known to such counsel to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, nor will such actions result in any violation of the provisions of the Restated Certificate of Incorporation or By-laws of the Company or any statute or any order, rule or regulation known to such counsel of any court or governmental agency or body having jurisdiction over the Company or any of its subsidiaries or of any of their properties, such as would be material to the business of the Company and its subsidiaries taken as a whole; 14 15 (iv) No consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Designated Securities or the consummation by the Company of the other transactions contemplated by this Agreement or such Pricing Agreement or the Indenture or the Deposit Agreement except such as have been obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Designated Securities by the Underwriters. In rendering the foregoing opinion such counsel may rely as to matters of law of the State of New Jersey upon the opinion of New Jersey counsel satisfactory to the Representatives, provided such counsel shall state therein that he believes that both the Underwriters and he are justified in relying upon such opinion. (d) Davis Polk & Wardwell, special counsel to the Company, shall have furnished to the Representatives their written opinion, dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus as amended or supplemented; (ii) The Designated Common Stock being delivered at such Time of Delivery has been duly and validly authorized (or, if at such Time of Delivery, Convertible Preferred Stock or Convertible Debt Securities are being issued, the Common Stock issuable upon conversion thereof has been duly and validly authorized and reserved for issuance) and when issued (in accordance with the applicable Pricing Agreement or the Convertible Preferred Stock or Convertible Debt Securities, as the case may be) will be validly issued and fully paid and non-assessable and the provisions relating to such Common Stock will conform to the 15 16 description thereof in the Prospectus, as amended or supplemented; (iii) This Agreement and any Pricing Agreement with respect to the Designated Securities have been duly authorized, executed and delivered by the Company; (iv) The Designated Securities have been duly authorized, executed, authenticated, issued and delivered and constitute valid and legally binding obligations of the Company, and with respect to Designated Convertible Debt Securities, entitled to the benefits provided by the Indenture; and the Designated Securities and the Indenture conform to the descriptions thereof in the Prospectus as amended or supplemented; (v) The Designated Offered Preferred Stock has been duly authorized; when the Designated Offered Preferred Stock being delivered at such Time of Delivery is paid for pursuant to this Agreement and the Pricing Agreement with respect to such Designated Offered Preferred Stock, such Designated Offered Preferred Stock will be duly and validly issued and fully paid and non-assessable; when Depositary Receipts evidencing any Depositary Shares are issued and delivered against payment for the Designated Offered Preferred Stock and the related Depositary Shares pursuant to this Agreement, the Pricing Agreement relating to the Designated Depositary Shares and the Deposit Agreement, the Depositary Receipts will be legally issued and will entitle the holders thereof to the rights specified in the Depositary Receipts and the Deposit Agreement; and the Designated Offered Preferred Stock and the Designated Depositary Shares conform to the descriptions thereof contained in the Prospectus as amended or supplemented; (vi) The Deposit Agreement (if any) has been duly authorized, executed and delivered by the Company and, assuming due authorization, execution and delivery by the Depositary, constitutes a valid and binding agreement of the Company, enforceable in accordance with its terms subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; and the 16 17 Deposit Agreement conforms to the description thereof contained in the Prospectus as amended or supplemented; (vii) The Indenture has been duly authorized, executed and delivered by the Company and constitutes a valid and legally binding instrument of the Company, enforceable in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; and the Indenture has been duly qualified under the Trust Indenture Act; and (viii) The Registration Statement and the Prospectus as amended or supplemented and any further amendments and supplements thereto made by the Company prior to the Time of Delivery for the Designated Securities (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) comply as to form in all material respects with the requirements of the Act and the Trust Indenture Act and the rules and regulations thereunder; they have no reason to believe that, as of its effective date, the Registration Statement or any further amendment thereto made by the Company prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that, as of its date, the Prospectus as amended or supplemented or any further amendment or supplement thereto made by the Company prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contained an untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading or that, as of the Time of Delivery, either the Registration Statement or the Prospectus as amended or supplemented or any further amendment or supplement thereto made by the Company prior to the Time of Delivery (other 17 18 than the financial statements and related schedules therein, as to which such counsel need express no opinion) contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading; In rendering the foregoing opinion such counsel may rely as to matters of law of the State of New Jersey upon the opinion of New Jersey counsel satisfactory to the Representatives, provided such counsel shall state therein that they believe that both the Underwriters and they are justified in relying upon such opinion. (e) At the Time of Delivery for such Designated Securities, the independent auditors of the Company who have certified the financial statements of the Company and its subsidiaries included or incorporated by reference in the Registration Statement shall have furnished to the Representatives a letter dated such Time of Delivery, to the effect set forth in Annex II hereto and as to such other matters as the Representatives may reasonably request, in form and substance satisfactory to the Representatives; (f) (i) Neither the Company nor any of its subsidiaries shall have sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus as amended or supplemented any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented, and (ii) since the respective dates as of which information is given in the Prospectus as amended or supplemented there shall not have been any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Company and its subsidiaries, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented, the effect of which, in any such case described in Clause (i) or (ii), is in the judgment of the Representatives so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Designated Securities on the terms and in the manner contemplated in the Prospectus as amended or supplemented; 18 19 (g) On or after the date of the Pricing Agreement relating to the Designated Securities no downgrading shall have occurred in the rating accorded the Company's debt securities by Moody's Investors Service, Inc. or Standard & Poor's Corporation; (h) On or after the date of the Pricing Agreement relating to the Designated Securities there shall not have occurred any of the following: (i) a suspension or material limitation in trading in securities generally on the New York Stock Exchange; (ii) a general moratorium on commercial banking activities in New York declared by either Federal or New York State authorities; or (iii) the engagement by the United States in hostilities which have resulted in the declaration, on or after the date of such Pricing Agreement, of a national emergency or war if the effect of any such event specified in this Clause (iii) in the judgment of the Representatives makes it impracticable or inadvisable to proceed with the public offering or the delivery of the Designated Securities on the terms and in the manner contemplated in the Prospectus as amended or supplemented; and (i) The Company shall have furnished or caused to be furnished to the Representatives at the Time of Delivery for the Designated Securities a certificate or certificates of officers of the Company satisfactory to the Representatives as to the accuracy in all material respects of the representations and warranties of the Company herein at and as of such Time of Delivery, as to the performance by the Company of all of its obligations hereunder to be performed at or prior to such Time of Delivery, as to the matters set forth in subsections (a) and (f) of this Section and as to such other matters as the Representatives may reasonably request. 8. (a) The Company will indemnify and hold harmless each Underwriter against any losses, claims, damages or liabilities to which such Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be 19 20 stated therein or necessary to make the statements therein not misleading, and will reimburse each Underwriter for any legal or other expenses reasonably incurred by such Underwriter in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company by any Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities; provided, however, that the foregoing indemnity agreement with respect to the Preliminary Prospectus shall not inure to the benefit of any Underwriter from whom the person asserting any such losses, claims, damages or liabilities purchased Securities, or any person controlling such Underwriter, if a copy of the Prospectus (as then amended or supplemented if the Company shall have furnished any amendments or supplements thereto) was not sent or given by or on behalf of such Underwriter to such person, if required by law so to have been delivered, at or prior to the written confirmation of the sale of the Securities to such person, and if the Prospectus (as so amended or supplemented) would have cured the defect giving rise to such losses, claims, damages or liabilities. (b) Each Underwriter will indemnify and hold harmless the Company, the officers and directors of the Company, and each person, if any, who controls the Company within the meaning of the Act, against any losses, claims, damages or liabilities to which the Company may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue 20 21 statement or omission or alleged omission was made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company by such Underwriter through the Representatives expressly for use therein; and will reimburse the Company for any legal or other expenses reasonably incurred by the Company in connection with investigating or defending any such action or claim as such expenses are incurred. (c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection. In case any such action shall be brought against any indemnified party it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. (d) If the indemnification provided for in this Section 8 is unavailable to or insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters of the Designated Securities on the other from the offering of the Designated Securities 21 22 to which such loss, claim, damage or liability (or action in respect thereof) relates. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law or if the indemnified party failed to give the notice required under subsection (c) above, then each indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company on the one hand and the Underwriters of the Designated Securities on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and such Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from such offering (before deducting expenses) received by the Company bear to the total underwriting discounts and commissions received by such Underwriters. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on the one hand or such Underwriters on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to subsection (d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the applicable Designated Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent 22 23 misrepresentation. The obligations of the Underwriters of Designated Securities in this subsection (d) to contribute are several in proportion to their respective underwriting obligations with respect to such Securities and not joint. (e) The obligations of the Company under this Section 8 shall be in addition to any liability which the Company may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls any Underwriter within the meaning of the Act; and the obligations of the Underwriters under this Section 8 shall be in addition to any liability which the respective Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Company and to each person, if any, who controls the Company within the meaning of the Act. 9. (a) If any Underwriter shall default in its obligation to purchase the Designated Securities which it has agreed to purchase under the Pricing Agreement relating to such Designated Securities, the Representatives may in their discretion arrange for themselves or another party or other parties to purchase such Designated Securities on the terms contained herein. If within thirty-six hours after such default by any Underwriter the Representatives do not arrange for the purchase of such Designated Securities, then the Company shall be entitled to a further period of thirty-six hours within which to procure another party or other parties to whom the Representatives shall not unreasonably object to purchase such Designated Securities on such terms. In the event that, within the respective prescribed period, the Representatives notify the Company that they have so arranged for the purchase of such Designated Securities, or the Company notifies the Representatives that it has so arranged for the purchase of such Designated Securities, the Representatives or the Company shall have the right to postpone the Time of Delivery for such Designated Securities for a period of not more than seven days, in order effect whatever changes may thereby be made necessary in the Registration Statement or the Prospectus as amended or supplemented, or in any other documents or arrangements, and the Company agrees to file promptly any amendments or supplements to the Registration Statement or the Prospectus which in the opinion of the Representatives may thereby be made necessary. The term "Underwriter" as used in this Agreement shall include any person substituted under this Section with like effect as if such person had originally been a party to the Pricing Agreement with respect to such Designated Securities. 23 24 (b) If, after giving effect to any arrangements for the purchase of the Designated Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company as provided in subsection (a) above, the aggregate principal amount of such Designated Securities which remains unpurchased does not exceed one-eleventh of the aggregate principal amount of the Designated Securities, then the Company shall have the right to require each non-defaulting Underwriter to purchase the principal amount of Designated Securities which such Underwriter agreed to purchase under the Pricing Agreement relating to such Designated Securities and, in addition, to require each non-defaulting Underwriter to purchase its pro rata share (based on the principal amount of Designated Securities which such Underwriter agreed to purchase under such Pricing Agreement) of the Designated Securities of such defaulting Underwriter or Underwriters for which such arrangements have not been made; but nothing herein shall relieve a defaulting Underwriter from liability for its default. (c) If, after giving effect to any arrangements for the purchase of the Designated Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company as provided in subsection (a) above, the aggregate principal amount of Designated Securities which remains unpurchased exceeds one-eleventh of the aggregate principal amount of the Designated Securities, as referred to in subsection (b) above, or if the Company shall not exercise the right described in subsection (b) above to require non-defaulting Underwriters to purchase Designated Securities of a defaulting Underwriter or Underwriters, then the Pricing Agreement relating to such Designated Securities shall thereupon terminate, without liability on the part of any non- defaulting Underwriter or the Company, except for the expenses to be borne by the Company and the Underwriters as provided in Section 6 hereof and the indemnity and contribution agreements in Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from liability for its default. 10. The respective indemnities, agreements, representations, warranties and other statements of the Company and the several Underwriters, as set forth in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of any Underwriter or any controlling person of any Underwriter, or the Company, or any officer or director or controlling person of the Company, and shall survive delivery of and payment for the Securities. 24 25 11. If any Pricing Agreement shall be terminated pursuant to Section 9 hereof, the Company shall not then be under any liability to any Underwriter with respect to the Designated Securities covered by such Pricing Agreement except as provided in Section 6 and Section 8 hereof; but, if for any other reason Designated Securities are not delivered by or on behalf of the Company as provided herein, the Company will reimburse the Underwriters through the Representatives for all out-of-pocket expenses approved in writing by the Representatives, including fees and disbursements of counsel, reasonably incurred by the Underwriters in making preparations for the purchase, sale and delivery of such Designated Securities, but the Company shall then be under no further liability to any Underwriter with respect to such Designated Securities except as provided in Section 6 and Section 8 hereof. 12. In all dealings hereunder, the Representatives of the Underwriters of Designated Securities shall act on behalf of each of such Underwriter, and the parties hereto shall be entitled to act and rely upon any statement, request, notice or agreement on behalf of any Underwriter made or given by such Representatives jointly or by such of the Representatives, if any, as may be designated for such purpose in the Pricing Agreement. All statements, requests, notices and agreements hereunder shall be in writing, and if to the Underwriters shall be delivered or sent by mail, telex or facsimile transmission to the address of the Representatives as set forth in the Pricing Agreement; and if to the Company shall be delivered or sent by mail, telex or facsimile transmission to the address of the Company set forth in the Registration Statement; provided, however, that any notice to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail, telex or facsimile transmission to such Underwriter at its address set forth in its Underwriters' Questionnaire, or telex constituting such Questionnaire, which address will be supplied to the Company by the Representatives upon request. Any such statements, requests, notices or agreements shall take effect upon receipt thereof. 13. This Agreement and each Pricing Agreement shall be binding upon, and inure solely to the benefit of, the Underwriters, the Company and, to the extent provided in Section 8 and Section 10 hereof, the officers and directors of the Company, and each person who controls the Company or any Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement or any such Pricing Agreement. No purchaser of 25 26 any of the Securities from any Underwriter shall be deemed a successor or assign by reason merely of such purchase. 14. Time shall be of the essence of each Pricing Agreement. As used herein, "business day" shall mean any day when the Commission's office in Washington, D.C. is open for business. 15. This Agreement and each Pricing Agreement shall be governed by and construed in accordance with the laws of the State of New York. 16. This Agreement and each Pricing Agreement may be executed by any one or more of the parties hereto and thereto in any number of counterparts, each of which shall be deemed to be an original, but all such respective counterparts shall together constitute one and the same instrument. If the foregoing is in accordance with your understanding, please sign and return to us ___ counterparts hereof. Very truly yours, THE CHUBB CORPORATION By:_______________________ Name: Title: Accepted as of the date hereof: [Name of Representative(s)] _______________________________ 26 27 ANNEX I Pricing Agreement [Name and Address of Representative(s)] ______________, 19__ Dear Sirs: The Chubb Corporation, a New Jersey corporation (the "Company"), proposes, subject to the terms and conditions stated herein and in the Underwriting Agreement, dated _____________, 199_ (the "Underwriting Agreement"), between the Company on the one hand and [Name of Representatives] on the other hand, to issue and sell to the Underwriters named in Schedule I hereto (the "Underwriters") the Securities specified in Schedule II hereto (the "Designated Securities"). Each of the provisions of the Underwriting Agreement is incorporated herein by reference in its entirety, and shall be deemed to be part of this Agreement to the same extent as if such provisions had been set forth in full herein; and each of the representations and warranties set forth therein shall be deemed to have been made at and as of the date of this Pricing Agreement, except that each representation and warranty which refers to the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a representation or warranty as of the date of the Underwriting Agreement in relation to the Prospectus (as therein defined), and also a representation and warranty as of the date of this Pricing Agreement in relation to the Prospectus as amended or supplemented relating to the Designated Securities which are the subject of this Pricing Agreement. Each reference to the Representatives herein and in the provisions of the Underwriting Agreement so incorporated by reference shall be deemed to refer to you. Unless otherwise defined herein, terms defined in the Underwriting Agreement are used herein as therein defined. The Representatives designated to act on behalf of the Representatives and on behalf of each of the Underwriters of the Designated Securities pursuant to Section 12 of the Underwriting Agreement and the address of the Representatives referred to in such Section 12 are set forth at the end of Schedule II hereto. Subject to the terms and conditions set forth herein and in the Underwriting Agreement incorporated herein 1 28 by reference, the Company agrees to issue and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not jointly, to purchase from the Company, at the time and place and at the purchase price to the Underwriters set forth in Schedule II hereto, the principal amount of Designated Securities set forth opposite the name of such Underwriter in Schedule I hereto. If the foregoing is in accordance with your understanding, please sign and return to us ________ counterparts hereof, and upon acceptance hereof by you, on behalf of each of the Underwriters, this letter and such acceptance hereof, including the provisions of the Underwriting Agreement incorporated herein by reference, shall constitute a binding agreement between each of the Underwriters and the Company. It is understood that your acceptance of this letter on behalf of each of the Underwriters is or will be pursuant to the authority set forth in a form of Agreement among Underwriters, the form of which shall be submitted to the Company for examination, upon request, but without warranty on the part of the Representatives as to the authority of the signers thereof. Very truly yours, THE CHUBB CORPORATION By_________________________ Name: Title: Accepted as of the date hereof: [Name of Representatives] __________________________ On behalf of each of the Underwriters 2 29 SCHEDULE I
Principal Amount of Designated Securities to be Underwriters Purchased ------------ ---------- [Names of Underwriters] . . . . . . . . . . . . . . . . $ --------- Total . . . . . . . . . . . . . . . . $ =========
1 30 SCHEDULE II Title of Designated Convertible Debt Securities: [ %] [Floating Rate] [Zero Coupon] [Notes] [Debentures] due Aggregate Principal Amount: [$] Price to Public: % of the principal amount of the Designated Convertible Debt Securities, plus accrued interest[, if any,] from [and accrued amortization, if any, from ] Purchase Price by Underwriters: % of the principal amount of the Designated Convertible Debt Securities, plus accrued interest[, if any,] from ] [and accrued amortization, if any, from ] Specified funds for payment of purchase price: [New York] Clearing House funds Indenture and Ranking: The Designated Convertible Debt Securities will be [subordinated] indebtedness of the Company issued under the Indenture dated ________ __, 19__, between the Company and _______________, as Trustee Maturity: Interest Rate: [ %] [Zero Coupon] [See Floating Rate Provisions] Interest Payment Dates: [months and dates] 1 31 Redemption Provisions: [No provisions for redemption] [The Designated Convertible Debt Securities may be redeemed, otherwise than through the sinking fund, in whole or in part at the option of the Company, [in the amount of [$] or an integral multiple thereof,] [on or after , at the following redemption prices (expressed in percentages of principal amount). If [redeemed on or before , %, and if] redeemed during the 12-month period beginning ,
Redemption Year Price ---- ----------
and thereafter] at 100% of their principal amount, together in each case with accrued interest to the redemption date] [on any interest payment date falling in or after , , at the election of the Company, at a redemption price equal to the principal amount thereof, plus accrued interest to the date of redemption.] [Other possible redemption provisions, such as mandatory redemption upon occurrence of certain events or redemption for changes in tax law] [Restriction on refunding] Sinking Fund Provisions: [No sinking fund provisions] [The Designated Convertible Debt Securities are entitled to the benefit of a sinking fund to retire [$] principal amount of Designated Securities on in each of the years through at 100% of their principal amount plus accrued interest] [, together with [cumulative] [noncumulative] redemptions at the option of the Company to retire an additional [$] principal amount of Designated Convertible Debt 2 32 Securities in the years through at 100% of their principal amount plus accrued interest]. [If Securities are extendable debt Securities, insert-- Extendable provisions: Securities are repayable on , [insert date and years], at the option of the holder, at their principal amount with accrued interest. Initial annual interest rate will be %, and thereafter annual interest rate will be adjusted on , and to a rate not less than % of the effective annual interest rate on U.S. Treasury obligations with -year maturities as of the [insert date 15 days prior to maturity date] prior to such [insert maturity date].] [If Securities are Floating Rate debt Securities, insert-- Floating rate provisions: Initial annual interest rate will be % through [and thereafter will be adjusted [monthly] [on each , , and ] [to an annual rate of % above the average rate for - year [month] [securities] [certificates of deposit] issued by and [insert names of banks].] [and the annual interest rate [thereafter] [from through ] will be the interest yield equivalent of the weekly average per annum market discount rate for -month Treasury bills plus % of Interest Differential (the excess, if any, of (i) then current weekly average per annum secondary market yield for -month certificates of deposit over (ii) then current interest yield equivalent of the weekly average per annum market discount rate for -month Treasury bills); [from and thereafter the rate will be the then current interest yield equivalent plus % of Interest Differential].] Defeasance provisions: Conversion Provisions: Initial Conversion Price: $__________ Per share of Common Stock Initial Conversion Date: Final Conversion Date: 3 33 Title of Designated Common Stock: Number of Shares of Designated Common Stock: Number of Shares of Firm Common Stock: Maximum Number of Shares of Optional Common Stock: Initial Offering Price to Public: [$________ per Share] [Formula] Purchase Price by Underwriters: [$________ per Share] [Formula] [Commission Payable to Underwriters: $_______ per Share] Specified Funds for Payment of Purchase Price: [New York] Clearinghouse Funds Title of Designated Offered Preferred Stock (including Designated Depositary Shares): [Date of Board Resolution Fixing the Terms and Conditions of the Designated Offered Preferred Stock: ........, 19..] Number of Shares of Designated Offered Preferred Stock (Designated Depositary Shares): Number of Shares of Firm Offered Preferred Stock (Firm Depositary Shares): Maximum Number of Shares of Optional Offered Preferred Stock (Optional Depositary Shares): [If Depositary Shares are to be issued: _____ Depositary Shares shall represent the right to receive an aggregate of ____ shares of Designated Offered Preferred Stock. Each Designated Depositary Share will represent one-___( ) of a share of Designated Offered Preferred Stock.] 4 34 Initial Offering Price to Public : [$...... per [Depositary] Share] [Formula] Purchase Price by Underwriters: [$...... per [Depositary] Share] [Formula] Specified Funds for Payment of Purchase Price: [New York] Clearinghouse Funds Dividend Rate: [.....% per annum] Dividend Payment Dates: [months and dates]y Dividend Rights: [Non-] cumulative, [deferred] Voting Rights: Liquidation Rights: Preemptive Rights: Redemption Provisions: [No provisions for redemption] [The Designated Offered Preferred Stock (Designated Depositary Shares) may be redeemed, [otherwise than through the sinking fund,] in whole or in part at the option of the Company, on or after ________, ____ at the following redemption prices:
Redemption Year Price ---- -----------
and thereafter at $.... per share, together in each case with accrued dividends to the redemption date.] 5 35 [On any dividend payment date falling on or after ________, ____, at the election of the Company, at a redemption price equal to the stated amount thereof, plus accrued dividends to the date of redemption.] [Other possible redemption provisions, such as mandatory redemption upon occurrence of certain events or redemption for changes in tax law] Sinking Fund Provisions: [None] [The shares of Designated Offered Preferred Stock (Designated Depositary Shares) are entitled to the benefit of a sinking fund to retire ______ shares of Designated Offered Preferred Stock (Designated Depositary Shares) on ________ in each of the years ____ through ____ at 100% of their stated amount plus accrued dividends] [,together with [cumulative] [non-cumulative] redemptions at the option of the Company to retire an additional ...... shares of Designated Offered Preferred Stock (Designated Depositary Shares) in the years ____ through ____ at 100% of their stated amount plus accrued dividends.] [Convertible into Common Stock:] Time of Delivery: Closing Location: Names and addresses of Representatives: Designated Representatives: Address for Notices, etc.: [Other Terms]: 6 36 ANNEX II Pursuant to Section 7(e) of the Underwriting Agreement, the independent auditors shall furnish letters to the Underwriters to the effect that: (i) they are independent auditors with respect to the Company and its subsidiaries within the meaning of the Act and the applicable published rules and regulations thereunder; (ii) in their opinion, the financial statements and any supplementary financial information and schedules (and, if applicable, prospective financial statements and/or pro forma financial information) examined by them and included or incorporated by reference in the Registration Statement or the Prospectus comply as to form in all material respects with the applicable accounting requirements of the Act or the Exchange Act, as applicable, and the related published rules and regulations thereunder; and, if applicable, they have made a review in accordance with standards established by the American Institute of Certified Public Accountants of the consolidated interim financial statements, selected financial data, pro forma financial information, prospective financial statements and/or condensed financial statements derived from audited financial statements of the Company for the periods specified in such letter, as indicated in their reports thereon, copies of which have been furnished to the representatives of the Underwriters (the "Representatives"); (iii) the unaudited selected financial information with respect to the consolidated results of operations and financial position of the Company for the five most recent fiscal years included in the Prospectus and included or incorporated by reference in Item 6 of the Company's Annual Report on Form 10-K for the most recent fiscal year agrees with the corresponding amounts (after restatement where applicable) in the audited consolidated financial statements for five such fiscal years which were included or incorporated by reference in the Company's Annual Reports on Form 10-K for such fiscal years; (iv) on the basis of limited procedures, not constituting an audit in accordance with generally accepted auditing standards, consisting of a reading of the unaudited financial statements and other 1 37 information referred to below, a reading of the latest available interim financial statements of the Company and subsidiaries, inspection of the minute books of the Company and its subsidiaries since the date of the latest audited financial statements included or incorporated by reference in the Prospectus, inquiries of officials of the Company and its subsidiaries responsible for financial and accounting matters and such other inquiries and procedures as may be specified in such letter, nothing came to their attention that caused them to believe that: (A) the unaudited condensed consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Company's Quarterly Reports on Form 10-Q incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Exchange Act as it applies to Form 10-Q and the related published rules and regulations thereunder or are not in conformity with generally accepted accounting principles applied on a basis substantially consistent with the basis for the audited consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; (B) any other unaudited income statement data and balance sheet items included in the Prospectus do not agree with the corresponding items in the unaudited consolidated financial statements from which such data and items were derived, and any such unaudited data and items were not determined on a basis substantially consistent with the basis for the corresponding amounts in the audited consolidated financial statements included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; (C) the unaudited financial statements which were not included in the Prospectus but from which were derived the unaudited condensed financial statements referred to in Clause (A) and any unaudited income statement data and balance sheet items included in the Prospectus and referred to in Clause (B) were not determined on a basis 2 38 substantially consistent with the basis for the audited financial statements included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; (D) any unaudited pro forma consolidated condensed financial statements included or incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Act and the published rules and regulations thereunder or the pro forma adjustments have not been properly applied to the historical amounts in the compilation of those statements; (E) as of a specified date not more than five days prior to the date of such letter, there have been any changes in the consolidated capital stock (other than issuances of capital stock of the Company upon exercise of options and stock appreciation rights, upon earn-outs of performance shares and upon conversions of convertible securities, in each case which were outstanding on the date of the latest balance sheet included or incorporated by reference in the Prospectus) or in the combined net case reserves with respect to the business managed by Chubb & Son Inc., or any increase in the consolidated long-term debt or in notes and mortgages payable of the Company and its subsidiaries, or any decreases in the aggregate market value of the 15 largest holdings of equity securities of the Company and its property and casualty insurance subsidiaries, combined net premiums receivable with respect to the business managed by Chubb & Son Inc. or other items specified by the Representatives, or any increases in any items specified by the Representatives, in each case as compared with amounts as of the date of the latest balance sheet included or incorporated by reference in the Prospectus, except in each case for changes, increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (F) for the period from the date of the latest financial statements included or incorporated by reference in the Prospectus to the specified date referred to in Clause (E) there were any decreases in combined net premiums with 3 39 respect to the business managed by Chubb & Son Inc. or in the investment income of the Company and its property and casualty insurance subsidiaries or any increases in the combined net loss and loss adjustment expenses incurred (exclusive of changes in incurred but not reported losses) with respect to the business managed by Chubb & Son Inc. or any increases or decreases in any items specified by the Representatives, in each case as compared with the comparable period of the preceding year and with the preceding period of corresponding length specified by the Representatives, except in each case for increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (v) In addition to the audit referred to in their report(s) included or incorporated by reference in the Prospectus and the limited procedures, inspection of minute books, inquiries and other procedures referred to in paragraphs (iii) and (iv) above, they have carried out certain specified procedures, not constituting an examination in accordance with generally accepted auditing standards, with respect to certain amounts, percentages and financial information specified by the Representatives which are derived from the general accounting records of the Company and its subsidiaries, which appear in the Prospectus (excluding documents incorporated by reference), or in Part II of or in exhibits and schedules to, the Registration Statement specified by the Representatives or in documents incorporated by reference in the Prospectus specified by the Representatives, and have compared certain of such amounts, percentages and financial information with the amounts included in or which can be derived from audited financial statements or with the accounting records of the Company and its subsidiaries and have found them to be in agreement. All references in this Annex II to the Prospectus shall be deemed to refer to the Prospectus (including the documents incorporated by reference therein) as defined in the Underwriting Agreement as of the date of the letter delivered on the date of the Pricing Agreement for purposes of such letter and to the Prospectus as amended or supplemented (including the documents incorporated by reference therein) in relation to the applicable Designated Securities for purposes of the letter delivered at the Time of Delivery for such Designated Securities. 4 EX-1.4 5 UNDERWRITING AGREEMENT - CONVERTIBLE GUARANTEED... 1 Exhibit 1.4 CHUBB CAPITAL CORPORATION Convertible Debt Securities ________________ Underwriting Agreement _____________, 19__ [Name(s) and address(es) of Representatives.] Dear Sirs/Mesdames: From time to time Chubb Capital Corporation, a New Jersey corporation (the "Company") and The Chubb Corporation, a New Jersey corporation, as guarantor (the "Guarantor"), propose to enter into one or more Pricing Agreements (each a "Pricing Agreement") in the form of Annex I hereto, with such additions and deletions as the parties thereto may determine, and, subject to the terms and conditions stated herein and therein, to issue and sell to the firms named in Schedule I to the applicable Pricing Agreement (such firms constituting the "Underwriters" with respect to such Pricing Agreement and the securities specified therein) certain of the Company's convertible debt securities (the "Securities") issued pursuant to the indenture dated ______, 199_ between the Company, the Guarantor, and The First National Bank of Chicago, as Trustee, (the "Indenture"), which may be convertible into shares of common stock of the Guarantor, par value $1.00 per share ("Common Stock"), as specified in Schedule II to such Pricing Agreement (with respect to any Pricing Agreement, the "Designated Securities"). The Securities are to be unconditionally guaranteed (the "Guarantees") as to payment of principal, premium, if any, and interest by the Guarantor upon the basis and on the terms specified in the Indenture. The terms and rights of any particular issuance of Designated Securities shall be as specified in the Pricing 2 Agreement relating thereto and in or pursuant to the Indenture. 1. Particular sales of Designated Securities may be made from time to time to the Underwriters of such Securities, for whom the firms designated as representatives of the Underwriters of such Securities in the Pricing Agreement relating thereto will act as representatives (the "Representatives"). The term "Representatives" also refers to a single firm acting as sole representative of the Underwriters and to Underwriters who act without any firm being designated as their representative. This Underwriting Agreement shall not be construed as an obligation of the Company or the Guarantor to sell any of the Securities (including the Guarantees) or as an obligation of any of the Underwriters to purchase the Securities (including the Guarantees). The obligation of the Company and the Guarantor to issue and sell any of the Securities (including the Guarantees) and the obligation of any of the Underwriters to purchase any of the Securities (including the Guarantees) shall be evidenced by the Pricing Agreement with respect to the Designated Securities specified therein. Each Pricing Agreement shall specify the aggregate principal amount of such Designated Securities, the initial public offering price of such Designated Securities, the purchase price to the Underwriters of such Designated Securities, the names of the Underwriters of such Designated Securities, the names of the Representatives of such Underwriters and the principal amount of such Designated Securities to be purchased by each Underwriter and shall set forth the date, time and manner of delivery of such Designated Securities and payment therefor. The Pricing Agreement shall also specify (to the extent not set forth in the Indenture and the registration statement and prospectus with respect thereto) the terms of such Designated Securities. A Pricing Agreement shall be in the form of an executed writing (which may be in counterparts), and may be evidenced by an exchange of telegraphic communications or any other rapid transmission device designed to produce a written record of communications transmitted. The obligations of the Underwriters under this Agreement and each Pricing Agreement shall be several and not joint. 2. The Company and the Guarantor jointly and severally represent and warrant to, and agree with, each of the Underwriters that: (a) A registration statement in respect of the Securities (including any Common Stock issuable upon conversion of any Securities) and the Guarantees has been filed with the Securities and Exchange Commission 2 3 (the "Commission"); such registration statement and any post-effective amendment thereto, each in the form heretofore delivered or to be delivered to the Representatives and, excluding exhibits to such registration statement, but including all documents incorporated by reference in the prospectus contained therein, to the Representatives for each of the other Underwriters have been declared effective by the Commission in such form; no other document with respect to such registration statement or document incorporated by reference therein has heretofore been filed or transmitted for filing with the Commission; and no stop order suspending the effectiveness of such registration statement has been issued and no proceeding for that purpose has been initiated or threatened by the Commission (any preliminary prospectus included in such registration statement or filed with the Commission pursuant to Rule 424(a) of the rules and regulations of the Commission under the Securities Act of 1933, as amended (the "Act"), being hereinafter called a "Preliminary Prospectus"; the various parts of such registration statement, including all exhibits thereto and the documents incorporated by reference in the prospectus contained in the registration statement, at the time such part of the registration statement became effective but excluding Form T-1, each as amended at the time such part of the registration statement became effective, being hereinafter called the "Registration Statement"; the prospectus relating to the Securities, in the form in which it has most recently been filed, or transmitted for filing, with the Commission on or prior to the date of this Agreement, being hereinafter called the "Prospectus"; any reference herein to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to the applicable form under the Act, as of the date of such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after the date of such Preliminary Prospectus or Prospectus, as the case may be, under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and incorporated by reference in such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment to the Registration Statement shall be deemed to refer to and include any annual report of the Company and the Guarantor filed pursuant to Section 13(a) or 15(d) of the Exchange Act after the effective date of the Registration Statement 3 4 that is incorporated by reference in the Registration Statement; and any reference to the Prospectus as amended or supplemented shall be deemed to refer to the Prospectus as amended or supplemented in relation to the applicable Designated Securities in the form in which it is filed with the Commission pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof, including any documents incorporated by reference therein as of the date of such filing); (b) The documents incorporated by reference in the Prospectus, when they became effective or were filed with the Commission, as the case may be, complied as to form in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and none of such documents contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading; and any further documents so filed and incorporated by reference in the Prospectus or any further amendment or supplement thereto, when such documents become effective or are filed with the Commission, as the case may be, will comply as to form in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company or the Guarantor by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities and such Guarantees; (c) The Registration Statement and the Prospectus comply as to form, and any further amendments or supplements to the Registration Statement or the Prospectus will comply as to form, in all material respects to the requirements of the Act and the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act") and the rules and regulations of the Commission thereunder and do not and will not, as of the applicable effective date as to the Registration Statement and any amendment thereto and as of the 4 5 applicable filing date as to the Prospectus and any amendment or supplement thereto, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company or the Guarantor by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities and such Guarantees; (d) Neither the Guarantor nor any of its subsidiaries has sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus any loss or interference with their businesses from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, which loss or interference would have a material adverse effect on the business or financial condition of the Guarantor and its subsidiaries taken as a whole, otherwise than as set forth or contemplated in the Prospectus; and, since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has not been any material adverse change, or any development involving a prospective material adverse change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Guarantor and its subsidiaries taken as a whole, otherwise than as set forth or contemplated in the Prospectus; (e) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus and has been duly qualified as a foreign corporation for the transaction of business in each other jurisdiction in which it owns or leases property, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of the failure to be so qualified in any such jurisdiction; (f) All of the issued shares of capital stock of the Company have been duly and validly authorized and 5 6 issued and are fully paid and non-assessable and are owned directly or indirectly by the Guarantor; (g) The Guarantor has been duly incorporated and is validly existing as a corporation under the laws of the jurisdiction of its incorporation with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus and has been duly qualified as a foreign corporation for the transaction of business in each other jurisdiction in which it owns or lease property, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of the failure to be so qualified in any such jurisdiction; (h) The Securities have been duly authorized, and, when Designated Securities are issued and delivered pursuant to this Agreement and any Pricing Agreement with respect to such Designated Securities, such Designated Securities will have been duly executed authenticated, issued and delivered and will constitute valid and legally binding obligations of the Company entitled to the benefits provided by the Indenture, which will be substantially in the form incorporated by reference as an exhibit to the Registration Statement; the Guarantees have been duly authorized, and, upon due execution, authentication and delivery of the Securities and the placement of the Guarantees thereon, the Guarantees will have been duly executed, issued and delivered and will constitute valid and binding obligations of the Guarantor entitled to the benefits provided by the Indenture; the Indenture has been duly authorized and duly qualified under the Trust Indenture Act and, at the Time of Delivery for such Designated Securities (as defined in Section 4 hereof), the Indenture will constitute a valid and legally binding instrument, enforceable in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; and the Indenture conforms, and the Designated Securities and the Guarantees will conform, to the descriptions thereof contained in the Prospectus as amended or supplemented with respect to such Designated Securities and such Guarantees; (i) When shares of Common Stock are initially issued upon conversion of any Securities, such Common Stock will have been duly and validly authorized and reserved for issuance and, when issued and delivered in 6 7 accordance with the provisions of the relevant Securities, will be duly and validly issued, fully paid and non-assessable and will conform to the description of the Common Stock contained in the Prospectus as amended or supplemented with respect to such relevant Securities; (j) The issue and sale of the Securities (and any Common Stock into which the Designated Securities may be convertible) and the Guarantees and the compliance by the Company and the Guarantor with all of the provisions of the Securities, the Guarantees, the Indenture, this Agreement and any Pricing Agreement, and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company, Guarantor or any of its subsidiaries is a party or by which the Company, the Guarantor or any of its subsidiaries is bound or to which any of the property or assets of the Company, the Guarantor or any of its subsidiaries is subject, nor will such action result in any violation of the provisions of the Certificate of Incorporation or By-Laws of the Company or the Restated Certificate of Incorporation or By-Laws of the Guarantor or any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company, the Guarantor or any of its subsidiaries or any of their properties except for such conflicts, breaches, violations or defaults which would not have a material adverse effect on the business, financial condition or results of operations of the Guarantor and its subsidiaries taken as a whole or on the Company's or Guarantor's ability to perform their respective obligations under this Agreement, the Securities and the Guarantees; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Securities and the Guarantees or the consummation by the Company or the Guarantor of the other transactions contemplated by this Agreement or any Pricing Agreement or the Indenture, except such as have been, or will have been prior to the Time of Delivery, obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in 7 8 connection with the purchase and distribution of the Securities and the Guarantees by the Underwriters; and (k) Other than as set forth in the Prospectus, there are no legal or governmental proceedings pending (including proceedings of any insurance regulatory authority) to which the Guarantor or any of its subsidiaries is a party or of which any property of the Guarantor or any of its subsidiaries is the subject which, if determined adversely to the Guarantor or any of its subsidiaries, would individually or in the aggregate have a material adverse effect on the consolidated financial position, stockholders' equity or results of operations of the Guarantor and its subsidiaries; and, to the best of the Company's and the Guarantor's knowledge, no such proceedings are threatened. 3. Upon the execution of the Pricing Agreement applicable to any Designated Securities and authorization by the Representatives of the release of such Designated Securities, the several Underwriters propose to offer such Designated Securities for sale upon the terms and conditions set forth in the Prospectus as amended or supplemented. 4. Designated Securities to be purchased by each Underwriter pursuant to the Pricing Agreement relating thereto, in definitive form to the extent practicable and with the Guarantees placed thereon, and in such authorized denominations and registered in such names as the Representatives may request upon at least forty-eight hours' prior notice to the Company, shall be delivered by or on behalf of the Company to the Representatives for the account of such Underwriter, against payment by such Underwriter or on its behalf of the purchase price therefor by certified or official bank check or checks, payable to the order of the Company in the funds specified in such Pricing Agreement, all at the place and time and date specified in such Pricing Agreement or at such other place and time and date as the Representatives and the Company may agree upon in writing, such time and date being herein called the "Time of Delivery" for such Securities. 5. Each of the Company and the Guarantor agrees with each of the Underwriters of any Designated Securities: (a) To prepare the Prospectus as amended and supplemented in relation to the applicable Designated Securities in a form approved by the Representatives and to file such Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's close of 8 9 business on the second business day following the execution and delivery of the Pricing Agreement relating to the applicable Designated Securities or, if applicable, such earlier time as may be required by Rule 424(b); to make no further amendment or any supplement to the Registration Statement or Prospectus as amended or supplemented after the date of the Pricing Agreement relating to such Securities and prior to the Time of Delivery for such Securities which shall be disapproved by the Representatives for such Securities promptly after reasonable notice thereof, and such disapproval shall not be unreasonable; to advise the Representatives promptly of any such amendment or supplement after such Time of Delivery and furnish the Representatives with copies thereof; to file promptly all reports and any definitive proxy or information statements required to be filed by the Company or the Guarantor with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the delivery of a prospectus is required in connection with the offering or sale of such Securities, and during such same period to advise the Representatives, promptly after it received notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to the Prospectus or any amended Prospectus has been filed with the Commission, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any prospectus relating to the Securities, of the suspension of the qualification of such Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information; and, in the event of the issuance of any such stop order or of any such order preventing or suspending the use of any prospectus relating to the Securities, of the suspension of the qualification of such Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information; and, in the event of the issuance of any such stop order or of any such order preventing or suspending the use of any prospectus relating to the Securities or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal; 9 10 (b) Promptly from time to time to take such action as the Representatives may reasonably request to qualify such Securities for offering and sale under the securities laws of such jurisdictions as the Representatives may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of such Securities, provided that in connection therewith neither the Company nor the Guarantor shall be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction; (c) To furnish the Underwriters with copies of the Prospectus as amended or supplemented in such quantities as the Representatives may from time to time reasonably request, and, if the delivery of a prospectus is required at any time in connection with the offering or sale of the Securities and if at such time any event shall have occurred as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or, if for any other reason it shall be necessary during such same period to amend or supplement the Prospectus or to file under the Exchange Act any document incorporated by reference in the Prospectus in order to comply with the Act, the Exchange Act or the Trust Indenture Act, to notify the Representatives and upon their request to file such document and to prepare and furnish without charge to each Underwriter and to any dealer in securities as many copies as the Representatives may from time to time reasonably request of an amended Prospectus or a supplement to the Prospectus which will correct such statement or omission or effect such compliance; (d) To make generally available to their respective securityholders as soon as practicable, but in any event not later than eighteen months after the effective date of the Registration Statement (as defined in Rule 158(c)), an earnings statement of the Guarantor and its subsidiaries (which need not be audited) complying with Section 11(a) of the Act and the rules and regulations of the Commission thereunder (including at the option of the Company Rule 158); and 10 11 (e) During the period beginning from the date of the Pricing Agreement for such Designated Securities and continuing to and including the earlier of (i) the termination of trading restrictions for such Designated Securities, as notified to the Company and the Guarantor by the Representatives and (ii) the Time of Delivery for such Designated Securities, not to offer, sell, contract to sell or otherwise dispose of any securities of the Company or the Guarantor, or guaranteed by the Guarantor, which debt securities mature more than one year after such Time of Delivery and are substantially similar to such Designated Securities or any securities convertible or exercisable for securities which are substantially similar to such Designated Securities, without the prior written consent of the Representatives. 6. Each of the Company and the Guarantor covenants and agrees with the several Underwriters that the Company and the Guarantor will pay or cause to be paid the following: (i) the reasonable fees, disbursements and expenses of the Company's and the Guarantor's counsel and independent auditors in connection with the registration of the Securities and the Guarantees under the Act and all other expenses in connection with the preparation, printing and filing of the Registration Statement, any Preliminary Prospectus and the Prospectus and amendments and supplements thereto and the mailing and delivering of copies thereof to the Underwriters and dealers; (ii) the cost of producing any Agreement among Underwriters, this Agreement, any Pricing Agreement, the Indenture, any Blue Sky Memoranda and any other documents in connection with the offering, purchase, sale and delivery of the Securities and the Guarantees; (iii) all expenses in connection with the qualification of the Securities and the Guarantees for offering and sale under state securities laws as provided in section 5(b) hereof, including the fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky surveys; (iv) any fees charged by securities rating services for rating the Securities and the Guarantees; (v) any filing fees incident to any required review by the National Association of Securities Dealers, Inc. of the terms of the sale of the Securities and the Guarantees; (vi) the cost of preparing the Securities and the Guarantees; (vii) the reasonable fees and expenses of any Trustee and any agent of any Trustee and the fees and disbursements of counsel for any Trustee in connection with the Indenture and the Securities and the Guarantees; and (viii) all other costs and expenses incident to the performance of its obligations hereunder which are not otherwise specifically provided for in this Section. It 11 12 is understood, however, that, except as provided in this Section, Section 8 and Section 11 hereof, the Underwriters will pay all of their own costs and expenses, including the fees of their counsel, transfer taxes on resale of any of the Securities by them, and any advertising expenses connected with any offers they may make. 7. The obligations of the Underwriters of any Designated Securities under the Pricing Agreement relating to such Designated Securities shall be subject, in the discretion of the Representatives, to the condition that all representations and warranties and other statements of the Company and the Guarantor in or incorporated by reference in the Pricing Agreement relating to such Designated Securities are, at and as of the Time of Delivery for such Designated Securities, true and correct in all material respects, the condition that the Company and the Guarantor shall have performed all of their obligations hereunder theretofore to be performed, and the following additional conditions: (a) The Prospectus as amended or supplemented in relation to the applicable Designated Securities shall have been filed with the Commission pursuant to Rule 424(b) within the applicable time period prescribed for such filing by the rules and regulations under the Act and in accordance with Section 5(a) hereof; no stop order suspending the effectiveness of the Registration Statement or any part thereof shall have been issued and no proceeding for that purpose shall have been initiated or threatened by the Commission; and all requests for additional information on the part of the Commission shall have been complied with to the Representatives' reasonable satisfaction; (b) Counsel for the Underwriters shall have furnished to the Representatives such opinion or opinions, dated the Time of Delivery for such Designated Securities, with respect to the validity of the Indenture, the Designated Securities and (any Common Stock issuable upon conversion of the Designated Securities), the Guarantees, the Registration Statement, the Prospectus as amended or supplemented and other related matters as the Representatives may reasonably request, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters; (c) Robert Rusis, Senior Vice President and General Counsel of the Guarantor shall have furnished to the Representatives his written opinion, dated the 12 13 Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) Each of the Company and the Guarantor has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each foreign jurisdiction in which it owns or leases property, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of failure to be so qualified in any such jurisdiction (such counsel being entitled to rely in respect of the opinion in this clause upon opinions of local counsel and in respect of matters of fact upon certificates of officers of the Guarantor or its subsidiaries, provided that such counsel shall state that he believes that both the Representatives and he are justified in relying upon such opinions and certificates); (ii) To the best of such counsel's knowledge and other than as set forth in the Prospectus, there are no legal or governmental proceedings pending to which the Guarantor or any of its subsidiaries is a party or of which any property of the Guarantor or any of its subsidiaries is the subject which, if determined adversely to the Guarantor or any of its subsidiaries, would individually or in the aggregate have a material adverse effect on the consolidated financial position, stockholders' equity or results of operations of the Guarantor and its subsidiaries; and, to the best of such counsel's knowledge, no such proceedings are threatened; (iii) The issue and sale of the Designated Securities (and any Common Stock for which the Designated Securities may be convertible), including the Guarantees, and the compliance by the Company and the Guarantor with all of the provisions of the Designated Securities, the Guarantees, the Indenture, this Agreement and the Pricing Agreement with respect to the Designated Securities and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed or trust, loan agreement or other 13 14 agreement or instrument known to such counsel to which the Guarantor or any of its subsidiaries is a party or by which the Guarantor or any of its subsidiaries is bound or to which any of the property or assets of the Guarantor or any of its subsidiaries is subject, nor will such actions result in any violation, of the provisions of the Certificate of Incorporation or By-laws of the Company, the Restated Certificate of Incorporation or By-Laws of the Guarantor or any statute or any order, rule or regulation known to such counsel of any court or governmental agency or body having jurisdiction over the Guarantor or any of its subsidiaries or of any of their properties, such as would be material to the business of the Company or the Guarantor and their subsidiaries taken as a whole; (iv) No consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Designated Securities or the issue of the Guarantees or the consummation by the Company of the other transactions contemplated by this Agreement or such Pricing Agreement or the Indenture, except such as have been obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Designated Securities by the Underwriters. In rendering the foregoing opinion such counsel may rely as to matters of law of the State of New Jersey upon the opinion of New Jersey counsel satisfactory to the Representatives, provided such counsel shall state therein that he believes that both the Underwriters and he are justified in relying upon such opinion. (d) Davis Polk & Wardwell, special counsel to the Company, shall have furnished to the Representatives their written opinion, dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) Each of the Company and the Guarantor has been duly incorporated and is validly existing as a corporation in good standing under the laws 14 15 of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus as amended or supplemented; (ii) At such Time of Delivery the Common Stock issuable upon conversion of the Convertible Debt Securities being issued has been duly and validly authorized and reserved for issuance and when issued (in accordance with the applicable Pricing Agreement or the Convertible Debt Securities) will be validly issued and fully paid and non- assessable and the provisions relating to such Common Stock will conform to the description thereof in the Prospectus, as amended or supplemented; (iii) This Agreement and any Pricing Agreement with respect to the Designated Securities have been duly authorized, executed and delivered by the Company and the Guarantor; (iv) The Designated Securities have been duly authorized, executed, authenticated, issued and delivered and constitute valid and legally binding obligations of the Company entitled to the benefits provided by the Indenture; and the Designated Securities, the Guarantees and the Indenture conform to the descriptions thereof in the Prospectus as amended or supplemented; (v) The Guarantees have been duly authorized, and, when the Securities have been executed, authenticated, delivered in accordance with the Indenture and paid for pursuant to this Agreement, will constitute valid and binding obligations of the Guarantor entitled to the benefits provided by the Indenture subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; (vi) The Indenture has been duly authorized, executed and delivered by the Company and the Guarantor and constitutes a valid and legally binding instrument of the Company and the Guarantor, enforceable in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of 15 16 general applicability relating to or affecting creditor's rights and to general equity principles; and each Indenture has been duly qualified under the Trust Indenture Act; (vii) The Company is exempt from all provisions of the Investment Company Act; and (viii) The Registration Statement and the Prospectus as amended or supplemented and any further amendments and supplements thereto made by the Company and the Guarantor prior to the Time of Delivery for the Designated Securities (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) comply as to form in all material respects with the requirements of the Act and the Trust Indenture Act and the rules and regulations thereunder; they have no reason to believe that, as of its effective date, the Registration Statement or any further amendment thereto made by the Company and the Guarantor prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that, as of its date, the Prospectus as amended or supplemented or any further amendment or supplement thereto made by the Company prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contained an untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading or that, as of the Time of Delivery, either the Registration Statement or the Prospectus as amended or supplemented or any further amendment or supplement thereto made by the Company and the Guarantor prior to the Time of Delivery (other than the financial statements and related schedules therein, as to which such counsel need express no opinion) contains an untrue statement of a material fact or omits to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading; 16 17 In rendering the foregoing opinion such counsel may rely as to matters of law of the State of New Jersey upon the opinion of New Jersey counsel satisfactory to the Representatives, provided such counsel shall state therein that they believe that both the Underwriters and they are justified in relying upon such opinion. (e) At the Time of Delivery for such Designated Securities, the independent auditors of the Guarantor who have certified the financial statements of the Guarantor and its subsidiaries included or incorporated by reference in the Registration Statement shall have furnished to the Representatives a letter dated such Time of Delivery, to the effect set forth in Annex II hereto and as to such other matters as the Representatives may reasonably request, in form and substance satisfactory to the Representatives; (f) (i) Neither the Guarantor nor any of its subsidiaries shall have sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus as amended or supplemented any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented, and (ii) since the respective dates as of which information is given in the Prospectus as amended or supplemented there shall not have been any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Guarantor and its subsidiaries, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented, the effect of which, in any such case described in Clause (i) or (ii), is in the judgment of the Representatives so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Designated Securities (including the Guarantees) on the terms and in the manner contemplated in the Prospectus as amended or supplemented; (g) On or after the date of the Pricing Agreement relating to the Designated Securities no downgrading shall have occurred in the rating accorded the Company's or the Guarantor's debt securities by Moody's Investors Service, Inc. or Standard & Poor's Corporation; 17 18 (h) On or after the date of the Pricing Agreement relating to the Designated Securities there shall not have occurred any of the following: (i) a suspension or material limitation in trading in securities generally on the New York Stock Exchange; (ii) a general moratorium on commercial banking activities in New York declared by either Federal or New York State authorities; or (iii) the engagement by the United States in hostilities which have resulted in the declaration, on or after the date of such Pricing Agreement, of a national emergency or war if the effect of any such event specified in this Clause (iii) in the judgment of the Representatives makes it impracticable or inadvisable to proceed with the public offering or the delivery of the Designated Securities (including the Guarantees) on the terms and in the manner contemplated in the Prospectus as amended or supplemented; and (i) The Company and the Guarantor shall have furnished or caused to be furnished to the Representatives at the Time of Delivery for the Designated Securities a certificate or certificates of officers of the Company and the Guarantor satisfactory to the Representatives as to the accuracy in all material respects of the representations and warranties of the Company and the Guarantor herein at and as of such Time of Delivery, as to the performance by the Company and the Guarantor of all of its obligations hereunder to be performed at or prior to such Time of Delivery, as to the matters set forth in subsections (a) and (f) of this Section and as to such other matters as the Representatives may reasonably request. 8. (a) The Company and the Guarantor will jointly and severally indemnify and hold harmless each Underwriter against any losses, claims, damages or liabilities to which such Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities or the Guarantees, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each Underwriter for any legal or other expenses reasonably 18 19 incurred by such Underwriter in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company and the Guarantor by any Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities or such Guarantees; provided, however, that the foregoing indemnity agreement with respect to the Preliminary Prospectus shall not inure to the benefit of any Underwriter from whom the person asserting any such losses, claims, damages or liabilities purchased Securities, or any person controlling such Underwriter, if a copy of the Prospectus (as then amended or supplemented if the Company shall have furnished any amendments or supplements thereto) was not sent or given by or on behalf of such Underwriter to such person, if required by law so to have been delivered, at or prior to the written confirmation of the sale of the Securities to such person, and if the Prospectus (as so amended or supplemented) would have cured the defect giving rise to such losses, claims, damages or liabilities. (b) Each Underwriter will indemnify and hold harmless the Company, the Guarantor, the officers and directors of the Company and the Guarantor, and each person, if any, who controls the Company or the Guarantor within the meaning of the Act, against any losses, claims, damages or liabilities to which the Company or the Guarantor may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities or the Guarantees, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in any Preliminary Prospectus, any preliminary 19 20 prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company and the Guarantor by such Underwriter through the Representatives expressly for use therein; and will reimburse the Company or the Guarantor for any legal or other expenses reasonably incurred by the Company or the Guarantor in connection with investigating or defending any such action or claim as such expenses are incurred. (c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection. In case any such action shall be brought against any indemnified party it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. (d) If the indemnification provided for in this Section 8 is unavailable to or insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Company and the Guarantor on the one hand and the Underwriters of the Designated Securities on the other from the offering of the Designated Securities (including the Guarantees) to which 20 21 such loss, claim, damage or liability (or action in respect thereof) relates. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law or if the indemnified party failed to give the notice required under subsection (c) above, then each indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company and the Guarantor on the one hand and the Underwriters of the Designated Securities on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Company and the Guarantor on the one hand and such Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from such offering (before deducting expenses) received by the Company and the Guarantor bear to the total underwriting discounts and commissions received by such Underwriters. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company and the Guarantor on the one hand or such Underwriters on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company, the Guarantor and the Underwriters agree that it would not be just and equitable if contribution pursuant to subsection (d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the applicable Designated Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any 21 22 person who was not guilty of such fraudulent misrepresentation. The obligations of the Underwriters of Designated Securities in this subsection (d) to contribute are several in proportion to their respective underwriting obligations with respect to such Securities and not joint. (e) The obligations of the Company and the Guarantor under this Section 8 shall be in addition to any liability which the Company and the Guarantor may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls any Underwriter within the meaning of the Act; and the obligations of the Underwriters under this Section 8 shall be in addition to any liability which the respective Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Company or the Guarantor and to each person, if any, who controls the Company or the Guarantor within the meaning of the Act. 9. (a) If any Underwriter shall default in its obligation to purchase the Designated Securities which it has agreed to purchase under the Pricing Agreement relating to such Designated Securities, the Representatives may in their discretion arrange for themselves or another party or other parties to purchase such Designated Securities on the terms contained herein. If within thirty-six hours after such default by any Underwriter the Representatives do not arrange for the purchase of such Designated Securities, then the Company shall be entitled to a further period of thirty-six hours within which to procure another party or other parties to whom the Representatives shall not unreasonably object to purchase such Designated Securities on such terms. In the event that, within the respective prescribed period, the Representatives notify the Company and the Guarantor that they have so arranged for the purchase of such Designated Securities, or the Company and the Guarantor notify the Representatives that they have so arranged for the purchase of such Designated Securities, the Representatives or the Company and the Guarantor shall have the right to postpone the Time of Delivery for such Designated Securities for a period of not more than seven days, in order to effect whatever changes may thereby be made necessary in the Registration Statement or the Prospectus as amended or supplemented, or in any other documents or arrangements, and the Company and the Guarantor agree to file promptly any amendments or supplements to the Registration Statement or the Prospectus which in the opinion of the Representatives may thereby be made necessary. The term "Underwriter" as used in this Agreement shall include any person substituted under this Section with like effect as if such person had originally been a party to 22 23 the Pricing Agreement with respect to such Designated Securities. (b) If, after giving effect to any arrangements for the purchase of the Designated Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company and the Guarantor as provided in subsection (a) above, the aggregate principal amount of such Designated Securities which remains unpurchased does not exceed one-eleventh of the aggregate principal amount of the Designated Securities, then the Company shall have the right to require each non-defaulting Underwriter to purchase the principal amount of Designated Securities which such Underwriter agreed to purchase under the Pricing Agreement relating to such Designated Securities and, in addition, to require each non-defaulting Underwriter to purchase its pro rata share (based on the principal amount of Designated Securities which such Underwriter agreed to purchase under such Pricing Agreement) of the Designated Securities of such defaulting Underwriter or Underwriters for which such arrangements have not been made; but nothing herein shall relieve a defaulting Underwriter from liability for its default. (c) If, after giving effect to any arrangements for the purchase of the Designated Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company and the Guarantor as provided in subsection (a) above, the aggregate principal amount of Designated Securities which remains unpurchased exceeds one-eleventh of the aggregate principal amount of the Designated Securities, as referred to in subsection (b) above, or if the Company and the Guarantor shall not exercise the right described in subsection (b) above to require non-defaulting Underwriters to purchase Designated Securities of a defaulting Underwriter or Underwriters, then the Pricing Agreement relating to such Designated Securities shall thereupon terminate, without liability on the part of any non-defaulting Underwriter or the Company or the Guarantor, except for the expenses to be borne by the Company, the Guarantor and the Underwriters as provided in Section 6 hereof and the indemnity and contribution agreements in Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from liability for its default. 10. The respective indemnities, agreements, representations, warranties and other statements of the Company, the Guarantor and the several Underwriters, as set forth in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain in 23 24 full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of any Underwriter or any controlling person of any Underwriter, or the Company, the Guarantor or any officer or director or controlling person of the Company or the Guarantor, and shall survive delivery of and payment for the Securities. 11. If any Pricing Agreement shall be terminated pursuant to Section 9 hereof, the Company and the Guarantor shall not then be under any liability to any Underwriter with respect to the Designated Securities covered by such Pricing Agreement except as provided in Section 6 and Section 8 hereof; but, if for any other reason Designated Securities are not delivered by or on behalf of the Company and the Guarantor as provided herein, the Company and the Guarantor will reimburse the Underwriters through the Representatives for all out-of-pocket expenses approved in writing by the Representatives, including fees and disbursements of counsel, reasonably incurred by the Underwriters in making preparations for the purchase, sale and delivery of such Designated Securities, but the Company and the Guarantor shall then be under no further liability to any Underwriter with respect to such Designated Securities except as provided in Section 6 and Section 8 hereof. 12. In all dealings hereunder, the Representatives of the Underwriters of Designated Securities shall act on behalf of each of such Underwriter, and the parties hereto shall be entitled to act and rely upon any statement, request, notice or agreement on behalf of any Underwriter made or given by such Representatives jointly or by such of the Representatives, if any, as may be designated for such purpose in the Pricing Agreement. All statements, requests, notices and agreements hereunder shall be in writing, and if to the Underwriters shall be delivered or sent by mail, telex or facsimile transmission to the address of the Representatives as set forth in the Pricing Agreement; and if to the Company shall be delivered or sent by mail, telex or facsimile transmission to the address of the Company or the Guarantor set forth in the Registration Statement; provided, however, that any notice to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail, telex or facsimile transmission to such Underwriter at its address set forth in its Underwriters' Questionnaire, or telex constituting such Questionnaire, which address will be supplied to the Company by the Representatives upon request. Any such statements, requests, notices or agreements shall take effect upon receipt thereof. 24 25 13. This Agreement and each Pricing Agreement shall be binding upon, and inure solely to the benefit of, the Underwriters, the Company, the Guarantor and, to the extent provided in Section 8 and Section 10 hereof, the officers and directors of the Company, the Guarantor and each person who controls the Company and the Guarantor or any Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement or any such Pricing Agreement. No purchaser of any of the Securities from any Underwriter shall be deemed a successor or assign by reason merely of such purchase. 14. Time shall be of the essence of each Pricing Agreement. As used herein, "business day" shall mean any day when the Commission's office in Washington, D.C. is open for business. 15. This Agreement and each Pricing Agreement shall be governed by and construed in accordance with the laws of the State of New York. 16. This Agreement and each Pricing Agreement may be executed by any one or more of the parties hereto and thereto in any number of counterparts, each of which shall be deemed to be an original, but all such respective counterparts shall together constitute one and the same instrument. If the foregoing is in accordance with your understanding, please sign and return to us ___ counterparts hereof. Very truly yours, CHUBB CAPITAL CORPORATION By:__________________________ Name: Title: THE CHUBB CORPORATION 25 26 By:__________________________ Name: Title: Accepted as of the date hereof: By: ____________________________ Name: Title: 26 27 ANNEX I Pricing Agreement [Name and Address of Representative(s)] __________, 19__ Dear Sirs: Chubb Capital Corporation, a New Jersey corporation (the "Company"), proposes, subject to the terms and conditions stated herein and in the Underwriting Agreement, dated _______, 199_ (the "Underwriting Agreement"), between the Company and The Chubb Corporation (the "Guarantor") on the one hand and _________________________________ on the other hand, to issue and sell to the Underwriters named in Schedule I hereto (the "Underwriters") the Securities specified in Schedule II hereto (the "Designated Securities"). Each of the provisions of the Underwriting Agreement is incorporated herein by reference in its entirety, and shall be deemed to be part of this Agreement to the same extent as if such provisions had been set forth in full herein; and each of the representations and warranties set forth therein shall be deemed to have been made at and as of the date of this Pricing Agreement, except that each representation and warranty which refers to the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a representation or warranty as of the date of the Underwriting Agreement in relation to the Prospectus (as therein defined), and also a representation and warranty as of the date of this Pricing Agreement in relation to the Prospectus as amended or supplemented relating to the Designated Securities which are the subject of this Pricing Agreement. Each reference to the Representatives herein and in the provisions of the Underwriting Agreement so incorporated by reference shall be deemed to refer to you. Unless otherwise defined herein, terms defined in the Underwriting Agreement are used herein as therein defined. The Representatives designated to act on behalf of the Representatives and on behalf of each of the Underwriters of the Designated Securities pursuant to Section 12 of the Underwriting Agreement and the address of 1 28 the Representatives referred to in such Section 12 are set forth at the end of Schedule II hereto. Subject to the terms and conditions set forth herein and in the Underwriting Agreement incorporated herein by reference, the Company agrees to issue and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not jointly, to purchase from the Company, at the time and place and at the purchase price to the Underwriters set forth in Schedule II hereto, the principal amount of Designated Securities set forth opposite the name of such Underwriter in Schedule I hereto. If the foregoing is in accordance with your understanding, please sign and return to us ___ counterparts hereof, and upon acceptance hereof by you, on behalf of each of the Underwriters, this letter and such acceptance hereof, including the provisions of the Underwriting Agreement incorporated herein by reference, shall constitute a binding agreement between each of the Underwriters, the Company and the Guarantor. It is understood that your acceptance of this letter on behalf of each of the Underwriters is or will be pursuant to the authority set forth in a form of Agreement among Underwriters, the form of which shall be submitted to the Company and the Guarantor for examination, upon request, but without warranty on the part of the Representatives as to the authority of the signers thereof. Very truly yours, CHUBB CAPITAL CORPORATION By:______________________ Name: Title: THE CHUBB CORPORATION By:______________________ Name: Title: Accepted as of the date hereof: [Name of Representatives] 2 29 _______________________________ On behalf of each of the Underwriters 3 30 SCHEDULE I
Principal Amount of Designated Securities to be Underwriters Purchased ------------ ---------- [Names of Underwriters] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ ---------- Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ ==========
1 31 SCHEDULE II Title of Designated Securities: [ %] [Floating Rate] [Zero Coupon] [Notes] [Debentures] due Aggregate Principal Amount: [$] Price to Public: % of the principal amount of the Designated Securities, plus accrued interest[, if any,] from [and accrued amortization, if any, from ] Purchase Price by Underwriters: % of the principal amount of the Designated Securities, plus accrued interest[, if any,] from ] [and accrued amortization, if any, from ] Specified funds for payment of purchase price: [New York] Clearing House funds Indenture and Ranking: The Designated Securities will be [subordinated] indebtedness of the Company issued under the Indenture dated ________ __, 19__, between the Company, the Guarantor and _______________, as Trustee Guarantees: The Designated Securities will be unconditionally guaranteed as to payment of principal, premium, if any, and interest by the Guarantors Maturity: Interest Rate: [ %] [Zero Coupon] [See Floating Rate Provisions] 1 32 Interest Payment Dates: [months and dates] Redemption Provisions: [No provisions for redemption] [The Designated Securities may be redeemed, otherwise than through the sinking fund, in whole or in part at the option of the Company, [in the amount of [$] or an integral multiple thereof,] [on or after , at the following redemption prices (expressed in percentages of principal amount). If [redeemed on or before , %, and if] redeemed during the 12-month period beginning ,
Redemption Year Price ---- ----------
and thereafter] at 100% of their principal amount, together in each case with accrued interest to the redemption date] [on any interest payment date falling in or after , , at the election of the Company, at a redemption price equal to the principal amount thereof, plus accrued interest to the date of redemption.] [Other possible redemption provisions, such as mandatory redemption upon occurrence of certain events or redemption for changes in tax law] [Restriction on refunding] Sinking Fund Provisions: [No sinking fund provisions] [The Designated Securities are entitled to the benefit of a sinking fund to retire [$] principal amount of Designated Securities on in each of the years through at 100% of their principal amount plus accrued interest] [, together with [cumulative] [noncumulative] redemptions at the option of the Company to retire an additional [$] 2 33 principal amount of Designated Securities in the years through at 100% of their principal amount plus accrued interest]. [If Securities are extendable debt Securities, insert-- Extendable provisions: Securities are repayable on , [insert date and years], at the option of the holder, at their principal amount with accrued interest. Initial annual interest rate will be %, and thereafter annual interest rate will be adjusted on , and to a rate not less than % of the effective annual interest rate on U.S. Treasury obligations with -year maturities as of the [insert date 15 days prior to maturity date] prior to such [insert maturity date].] [If Securities are Floating Rate debt Securities, insert-- Floating rate provisions: Initial annual interest rate will be % through [and thereafter will be adjusted [monthly] [on each , and ] [to an annual rate of % above the average rate for -year [month] [securities] [certificates of deposit] issued by and [insert names of banks].] [and the annual interest rate [thereafter] [from through ] will be the interest yield equivalent of the weekly average per annum market discount rate for -month Treasury bills plus % of Interest Differential (the excess, if any, of (i) then current weekly average per annum secondary market yield for -month certificates of deposit over (ii) then current interest yield equivalent of the weekly average per annum market discount rate for -month Treasury bills); [from and thereafter the rate will be the then current interest yield equivalent plus % of Interest Differential].] Defeasance provisions: Initial Conversion Price: $ Per share of Common Stock Initial Conversion Date: 3 34 Final Conversion Date: Time of Delivery: Closing Location: Names and addresses of Representatives: Designated Representatives: Address for Notices, etc.: [Other Terms]: 4 35 ANNEX II Pursuant to Section 7(e) of the Underwriting Agreement, the independent auditors shall furnish letters to the Underwriters to the effect that: (i) They are independent auditors with respect to the Guarantor and its subsidiaries within the meaning of the Act and the applicable published rules and regulations thereunder; (ii) In their opinion, the financial statements and any supplementary financial information and schedules (and, if applicable, prospective financial statements and/or pro forma financial information) examined by them and included or incorporated by reference in the Registration Statement or the Prospectus comply as to form in all material respects with the applicable accounting requirements of the Act or the Exchange Act, as applicable, and the related published rules and regulations thereunder; and, if applicable, they have made a review in accordance with standards established by the American Institute of Certified Public Accountants of the consolidated interim financial statements, selected financial data, pro forma financial information, prospective financial statements and/or condensed financial statements derived from audited financial statements of the Guarantor for the periods specified in such letter, as indicated in their reports thereon, copies of which have been furnished to the representatives of the Underwriters (the "Representatives"); (iii) The unaudited selected financial information with respect to the consolidated results of operations and financial position of the Guarantor for the five most recent fiscal years included in the Prospectus and included or incorporated by reference in Item 6 of the Guarantor's Annual Report on Form 10-K for the most recent fiscal year agrees with the corresponding amounts (after restatement where applicable) in the audited consolidated financial statements for five such fiscal years which were included or incorporated by reference in the Guarantor's Annual Reports on Form 10-K for such fiscal years; 1 36 (iv) On the basis of limited procedures, not constituting an audit in accordance with generally accepted auditing standards, consisting of a reading of the unaudited financial statements and other information referred to below, a reading of the latest available interim financial statements of the Guarantor and its subsidiaries, inspection of the minute books of the Guarantor and its subsidiaries since the date of the latest audited financial statements included or incorporated by reference in the Prospectus, inquiries of officials of the Guarantor and its subsidiaries responsible for financial and accounting matters and such other inquiries and procedures as may be specified in such letter, nothing came to their attention that caused them to believe that: (A) the unaudited condensed consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Guarantor's Quarterly Reports on Form 10-Q incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Exchange Act as it applies to Form 10-Q and the related published rules and regulations thereunder or are not in conformity with generally accepted accounting principles applied on a basis substantially consistent with the basis for the audited consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Guarantor's Annual Report on Form 10-K for the most recent fiscal year; (B) any other unaudited income statement data and balance sheet items included in the Prospectus do not agree with the corresponding items in the unaudited consolidated financial statements from which such data and items were derived, and any such unaudited data and items were not determined on a basis substantially consistent with the basis for the corresponding amounts in the audited consolidated financial statements included or incorporated by reference in the Guarantor's Annual Report on Form 10-K for the most recent fiscal year; (C) the unaudited financial statements which were not included in the Prospectus but from which 2 37 were derived the unaudited condensed financial statements referred to in Clause (A) and any unaudited income statement data and balance sheet items included in the Prospectus and referred to in Clause (B) were not determined on a basis substantially consistent with the basis for the audited financial statements included or incorporated by reference in the Guarantor's Annual Report on Form 10-K for the most recent fiscal year; (D) any unaudited pro forma consolidated condensed financial statements included or incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Act and the published rules and regulations thereunder or the pro forma adjustments have not been properly applied to the historical amounts in the compilation of those statements; (E) as of a specified date not more than five days prior to the date of such letter, there have been any changes in the consolidated capital stock (other than issuances of capital stock of the Company upon exercise of options and stock appreciation rights, upon earn-outs of performance shares and upon conversions of convertible securities, in each case which were outstanding on the date of the latest balance sheet included or incorporated by reference in the Prospectus) or in the combined net case reserves with respect to the business managed by Chubb & Son Inc., or any increase in the consolidated long-term debt or in notes and mortgages payable of the Guarantor and its subsidiaries, combined net premiums receivable with respect to the business managed by Chubb & Son Inc. or other items specified by the Representatives, or any increases in any items specified by the Representatives, in each case as compared with amounts as of the date of the latest balance sheet included or incorporated by reference in the Prospectus, except in each case for changes, increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (F) for the period from the date of the latest financial statements included or incorporated by reference in the Prospectus to the specified date referred to in Clause (E) there 3 38 were any decreases in combined net premiums with respect to the business managed by Chubb & Son Inc. or in the investment income of the Guarantor and its property and casualty insurance subsidiaries or any increases in the combined net loss and loss adjustment expenses incurred (exclusive of changes in incurred but not reported losses) with respect to the business managed by Chubb & Son Inc. or any increases or decreases in any items specified by the Representatives, in each case as compared with the comparable period of the preceding year and with the preceding period of corresponding length specified by the Representatives, except in each case for increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (v) In addition to the audit referred to in their report(s) included or incorporated by reference in the Prospectus and the limited procedures, inspection of minute books, inquiries and other procedures referred to in paragraphs (iii) and (iv) above, they have carried out certain specified procedures, not constituting an examination in accordance with generally accepted auditing standards, with respect to certain amounts, percentages and financial information specified by the Representatives which are derived from the general accounting records of the Guarantor and its subsidiaries, which appear in the Prospectus (excluding documents incorporated by reference) or in Part II of, or in exhibits and schedules to, the Registration Statement specified by the Representatives or in documents incorporated by reference in the Prospectus specified by the Representatives, and have compared certain of such amounts, percentages and financial information with the amounts included in or which can be derived from audited financial statements or with the accounting records of the Guarantor and its subsidiaries and have found them to be in agreement. All references in this Annex II to the Prospectus shall be deemed to refer to the Prospectus (including the documents incorporated by reference therein) as defined in the Underwriting Agreement as of the date of the letter delivered on the date of the Pricing Agreement for purposes of such letter and to the Prospectus as amended or supplemented (including the documents incorporated by reference therein) in relation to the applicable Designated 4 39 Securities for purposes of the letter delivered at the Time of Delivery for such Designated Securities. 5 EX-4.3 6 INDENTURE - SUBORDINATED DEBT SECURITIES 1 Exhibit 4.3 =============================================================================== THE CHUBB CORPORATION AND THE FIRST NATIONAL BANK OF CHICAGO , Trustee Indenture Dated as of __________ __, 199_ Providing for the Issuance of Subordinated Debt Securities __________ =============================================================================== 2 TABLE OF CONTENTS ARTICLE 1 DEFINITIONS SECTION 1.1. Certain Terms Defined . . . . . . . . . . . . . . . . . . 1 ARTICLE 2 SECURITIES SECTION 2.1. Forms Generally . . . . . . . . . . . . . . . . . . . . . 6 SECTION 2.2. Form of Trustee's Certificate of Authentication . . . . . . . . . . . . . . . . . . . . . 7 SECTION 2.3. Amount Unlimited; Issuable in Series . . . . . . . . . . 7 SECTION 2.4. Authentication and Delivery of Securities . . . . . . . . . . . . . . . . . . . . . . . 9 SECTION 2.5. Execution of Securities . . . . . . . . . . . . . . . . . 11 SECTION 2.6. Certificate of Authentication . . . . . . . . . . . . . . 11 SECTION 2.7. Denomination and Date of Securities; Payments of Interest . . . . . . . . . . . . . . . . . . 11 SECTION 2.8. Registration, Transfer and Exchange . . . . . . . . . . . 13 SECTION 2.9. Mutilated, Defaced, Destroyed, Lost and Stolen Securities . . . . . . . . . . . . . . . . . . . . 14 SECTION 2.10. Cancellation of Securities; Destruction Thereof . . . . . . . . . . . . . . . . . . . . . . . . . 15 SECTION 2.11. Temporary Securities . . . . . . . . . . . . . . . . . . 15 ARTICLE 3 COVENANTS OF THE ISSUER SECTION 3.1. Payment of Principal and Interest . . . . . . . . . . . . 16 SECTION 3.2. Offices for Payments, etc. . . . . . . . . . . . . . . . 16 SECTION 3.3. Appointment to Fill a Vacancy in Office of Trustee . . . . . . . . . . . . . . . . . . . . . . . 17 SECTION 3.4. Paying Agents . . . . . . . . . . . . . . . . . . . . . . 17 SECTION 3.5. Certificate of the Issuer . . . . . . . . . . . . . . . . 18 SECTION 3.6. Corporate Existence . . . . . . . . . . . . . . . . . . . 18 ARTICLE 4 SECURITYHOLDERS' LISTS AND REPORTS BY THE ISSUER AND THE TRUSTEE
3 SECTION 4.1. Securityholders' Lists . . . . . . . . . . . . . . . . . 18 SECTION 4.2. Reports by the Issuer . . . . . . . . . . . . . . . . . . 19 SECTION 4.3. Reports by the Trustee . . . . . . . . . . . . . . . . . 19 ARTICLE 5 REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT SECTION 5.1. Event of Default Defined; Acceleration of Maturity; Waiver of Default . . . . . . . . . . . . . 19 SECTION 5.2. Collection of Indebtedness by Trustee; Trustee May Prove Debt . . . . . . . . . . . . . . . . . 22 SECTION 5.3. Application of Proceeds . . . . . . . . . . . . . . . . . 25 SECTION 5.4. Suits for Enforcement . . . . . . . . . . . . . . . . . . 26 SECTION 5.5. Restoration of Rights on Abandonment of Proceedings . . . . . . . . . . . . . . . . . . . . . . . 26 SECTION 5.6. Limitations on Suits by Securityholders . . . . . . . . . 27 SECTION 5.7. Unconditional Right of Securityholders to Institute Certain Suits . . . . . . . . . . . . . . . 27 SECTION 5.8. Powers and Remedies Cumulative; Delay or Omission Not Waiver of Default . . . . . . . . . . . . . 28 SECTION 5.9. Control by Securityholders . . . . . . . . . . . . . . . 28 SECTION 5.10. Waiver of Past Defaults . . . . . . . . . . . . . . . . . 29 SECTION 5.11. Trustee to Give Notice of Default, But May Withhold in Certain Circumstances . . . . . . . . . . 29 SECTION 5.12. Right of Court to Require Filing of Undertaking to Pay Costs . . . . . . . . . . . . . . . . 30 SECTION 5.13. Waiver of Stay or Extension Laws . . . . . . . . . . . . 30 ARTICLE 6 CONCERNING THE TRUSTEE SECTION 6.1. Duties and Responsibilities of the Trustee; During Default; Prior to Default . . . . . . . . . . . . . . . . . . . . . . . . . 31 SECTION 6.2. Certain Rights of the Trustee . . . . . . . . . . . . . . 32 SECTION 6.3. Trustee Not Responsible for Recitals, Disposition of Securities or Application of Proceeds Thereof . . . . . . . . . . . . . . . . . . . 33 SECTION 6.4. Trustee and Agents May Hold Securities; Collections, etc. . . . . . . . . . . . . . . . . . . . . 34 SECTION 6.5. Moneys Held by Trustee . . . . . . . . . . . . . . . . . 34 SECTION 6.6. Compensation and Indemnification of Trustee and Its Prior Claim . . . . . . . . . . . . . . . 34 SECTION 6.7. Right of Trustee to Rely on Officers' Certificate, etc. . . . . . . . . . . . . . . . . . . . . 35
2 4 SECTION 6.8. Persons Eligible for Appointment as Trustee . . . . . . . . . . . . . . . . . . . . . . . . . 35 SECTION 6.9. Resignation and Removal; Appointment of Successor Trustee . . . . . . . . . . . . . . . . . . . . 35 SECTION 6.10. Acceptance of Appointment by Successor Trustee . . . . . . . . . . . . . . . . . . . . . . . . . 37 SECTION 6.11. Merger, Conversion, Consolidation or Succession to Business of Trustee . . . . . . . . . . . . 38 ARTICLE 7 CONCERNING THE SECURITYHOLDERS SECTION 7.1. Evidence of Action Taken by Securityholders . . . . . . . . . . . . . . . . . . . . . 39 SECTION 7.2. Proof of Execution of Instruments and of Holding of Securities . . . . . . . . . . . . . . . . . . 39 SECTION 7.3. Holders to be Treated as Owners . . . . . . . . . . . . . 40 SECTION 7.4. Securities Owned by Issuer Deemed Not Outstanding . . . . . . . . . . . . . . . . . . . . . . . 40 SECTION 7.5. Right of Revocation of Action Taken . . . . . . . . . . . 41 ARTICLE 8 SUPPLEMENTAL INDENTURES SECTION 8.1. Supplemental Indentures Without Consent of Securityholders . . . . . . . . . . . . . . . . . . . 41 SECTION 8.2. Supplemental Indentures With Consent of Securityholders . . . . . . . . . . . . . . . . . . . . . 43 SECTION 8.3. Effect of Supplemental Indenture . . . . . . . . . . . . 45 SECTION 8.4. Documents to Be Given to Trustee . . . . . . . . . . . . 45 SECTION 8.5. Notation on Securities in Respect of Supplemental Indentures . . . . . . . . . . . . . . . . . 45 SECTION 8.6. Subordination Unimpaired . . . . . . . . . . . . . . . . 45 ARTICLE 9 CONSOLIDATION, MERGER, SALE OR CONVEYANCE SECTION 9.1. Issuer May Consolidate, etc., on Certain Terms . . . . . . . . . . . . . . . . . . . . . . . . . . 46 SECTION 9.2. Successor Corporation Substituted . . . . . . . . . . . . 46 SECTION 9.3. Opinion of Counsel to Trustee . . . . . . . . . . . . . . 47 ARTICLE 10
3 5 SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS SECTION 10.1. Satisfaction and Discharge of Indenture . . . . . . . . . 47 SECTION 10.2. Application by Trustee of Funds Deposited for Payment of Securities . . . . . . . . . . . 48 SECTION 10.3. Repayment of Moneys Held by Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . 49 SECTION 10.4. Return of Moneys Held by Trustee and Paying Agent Unclaimed for Three Years . . . . . . . . . 49 ARTICLE 11 MISCELLANEOUS PROVISIONS SECTION 11.1. Incorporators, Stockholders, Officers and Directors of Issuer Exempt from Individual Liability . . . . . . . . . . . . . . . . . . 49 SECTION 11.2. Provisions of Indenture for the Sole Benefit of Parties and Securityholders . . . . . . . . . 49 SECTION 11.3. Successors and Assigns of Issuer Bound by Indenture . . . . . . . . . . . . . . . . . . . . . . 50 SECTION 11.4. Notices and Demands on Issuer, Trustee and Securityholders . . . . . . . . . . . . . . . . . . . 50 SECTION 11.5. Officers' Certificates and Opinions of Counsel; Statements to Be Contained Therein . . . . . . . . . . . . . . . . . . . . . . . . . 51 SECTION 11.6. Payments Due on Saturdays, Sundays and Holidays . . . . . . . . . . . . . . . . . . . . . . . . 52 SECTION 11.7. Conflict of Any Provision of Indenture with Trust Indenture Act of 1939 . . . . . . . . . . . . 52 SECTION 11.8. New York Law to Govern . . . . . . . . . . . . . . . . . 52 SECTION 11.9. Counterparts . . . . . . . . . . . . . . . . . . . . . . 52 SECTION 11.10. Effect of Headings . . . . . . . . . . . . . . . . . . . 53 ARTICLE 12 REDEMPTION OF SECURITIES AND SINKING FUNDS SECTION 12.1. Applicability of Article . . . . . . . . . . . . . . . . 53 SECTION 12.2. Notice of Redemption; Partial Redemptions . . . . . . . . . . . . . . . . . . . . . . . 53 SECTION 12.3. Payment of Securities Called for Redemption . . . . . . . . . . . . . . . . . . . . . . . 55 SECTION 12.4. Exclusion of Certain Securities from Eligibility for Selection for Redemption . . . . . . . . . . . . . . . . . . . . . . . 56 SECTION 12.5. Mandatory and Optional Sinking Funds . . . . . . . . . . 56
4 6 ARTICLE 13 CONVERSION OF SECURITIES SECTION 13.1. Applicability of Article . . . . . . . . . . . . . . . . 59 SECTION 13.2. Exercise of Conversion Privilege . . . . . . . . . . . . 59 SECTION 13.3. No Fractional Shares . . . . . . . . . . . . . . . . . . 61 SECTION 13.4. Adjustment of Conversion Price . . . . . . . . . . . . . 61 SECTION 13.5. Notice of Certain Corporate Actions . . . . . . . . . . . 66 SECTION 13.6. Reservation of Shares of Common Stock . . . . . . . . . . 67 SECTION 13.7. Payment of Certain Taxes Upon Conversion . . . . . . . . . . . . . . . . . . . . . . . 67 SECTION 13.8. Nonassessability . . . . . . . . . . . . . . . . . . . . 67 SECTION 13.9. Effect of Consolidation or Merger on Conversion Privilege . . . . . . . . . . . . . . . . . . 67 SECTION 13.10. Duties of Trustee Regarding Conversion . . . . . . . . . 69 SECTION 13.11. Repayment of Certain Funds Upon Conversion . . . . . . . . . . . . . . . . . . . . . . . 69 ARTICLE 14 SUBORDINATION OF SECURITIES SECTION 14.1. Subordination of the Securities . . . . . . . . . . . . . 69 SECTION 14.2. No Payment on Securities in Event of Default on Senior Indebtedness . . . . . . . . . . . . . 70 SECTION 14.3. Distribution on Dissolution, Liquidation and Reorganization of the Issuer . . . . . . . . . . . . 71 SECTION 14.4. Payment to Holders of Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . 72 SECTION 14.5. Subrogation . . . . . . . . . . . . . . . . . . . . . . . 73 SECTION 14.6. Payment on Securities Permitted . . . . . . . . . . . . . 74 SECTION 14.7. Authorization of Holders to Trustee to Effect Subordination . . . . . . . . . . . . . . . . . . 74 SECTION 14.8. Trustee as Holder of Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . 75 SECTION 14.9. Notices to Trustee . . . . . . . . . . . . . . . . . . . 75 SECTION 14.10. No Fiduciary Duty by Trustee to Holders of Senior Indebtedness . . . . . . . . . . . . . . . . . 75
TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82 ACKNOWLEDGMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 5 7 THIS INDENTURE, dated as of __________ __, 199_ between The Chubb Corporation, a New Jersey corporation (the "Issuer"), and The First National Bank of Chicago, a national banking association (the "Trustee"), W I T N E S S E T H: WHEREAS, the Issuer has duly authorized the issue from time to time of its unsecured, subordinated debentures, notes or other evidences of indebtedness to be issued in one or more series (the "Securities") up to such principal amount or amounts as may from time to time be authorized in accordance with the terms of this Indenture and to provide, among other things, for the authentication, delivery and administration thereof, the Issuer has duly authorized the execution and delivery of this Indenture; and WHEREAS, all things necessary to make this Indenture a valid indenture and agreement according to its terms have been done; NOW, THEREFORE: In consideration of the premises and the purchases of the Securities by the holders thereof, the Issuer and the Trustee mutually covenant and agree for the equal and proportionate benefit of the respective holders from time to time of the Securities as follows: ARTICLE 1 DEFINITIONS SECTION 1.1. CERTAIN TERMS DEFINED. The following terms (except as otherwise expressly provided or unless the context otherwise clearly requires) for all purposes of this Indenture and of any indenture supplemental hereto shall have the respective meanings specified in this Section. All other terms used in this Indenture that are defined in the Trust Indenture Act of 1939 or the definitions of which in the Securities Act of 1933 are referred to in the Trust Indenture Act of 1939, 1 8 including terms defined therein by reference to the Securities Act of 1933 (the "Securities Act") (except as herein otherwise expressly provided or unless the context otherwise clearly requires), shall have the meanings assigned to such terms in said Trust Indenture Act and in said Securities Act as in force at the date of this Indenture. All accounting terms used herein and not expressly defined shall have the meanings assigned to such terms in accordance with generally accepted accounting principles, and the term "generally accepted accounting principles" means such accounting principles as are generally accepted at the time of any computation. 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. The terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular. "BOARD OF DIRECTORS" means either the Board of Directors of the Issuer or any committee of such Board duly authorized to act hereunder. "BOARD RESOLUTION" means a copy of one or more resolutions, certified by the Secretary or an Assistant Secretary of the Issuer to have been duly adopted or consented to by the Board of Directors and to be in full force and effect, and delivered to the Trustee. "BUSINESS DAY" means, with respect to any Security, a day that in Chicago, Illinois or in the city (or in any of the cities, if more than one) in which amounts are payable, as specified in the form of such Security, is not a day on which banking institutions are authorized by law or regulation to close. "CASH TRANSACTION" means any transaction in which full payment for goods or securities sold is made within seven days after delivery of the goods or securities in currency or in checks or other orders drawn upon banks or bankers and payable upon demand. "COMMISSION" means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, or if at any time after the execution and delivery of this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties on such date. "COMMON STOCK" means shares of common stock, par value $1.00 per share, of the Issuer. 2 9 "CONVERSION PRICE" means the amount of Common Stock issuable upon conversion of any Securities and, in the case of any specific series of Securities, may be expressed in terms of either a conversion price or a conversion rate. "EVENT OF DEFAULT" means any event or condition specified as such in Section 5.1. "HOLDER", "HOLDER OF SECURITIES", "SECURITYHOLDER" or other similar terms mean the registered holder of any Security. "INDENTURE" means this instrument as originally executed and delivered or, if amended or supplemented as herein provided, as so amended or supplemented or both, and shall include the forms and terms of particular series of Securities established as contemplated hereunder. "INTEREST" means, when used with respect to non-interest bearing Securities, interest payable after maturity. "ISSUER" means (except as otherwise provided in Article Six) The Chubb Corporation, a New Jersey corporation, and, subject to Article Nine, its successors and assigns. "ISSUER ORDER" means a written statement, request or order of the Issuer signed in its name by the Chairman, Vice Chairman, the President, any Vice President or the Treasurer of the Issuer. "OFFICERS' CERTIFICATE" means a certificate signed by the Chairman, the Vice Chairman, the President or any Vice President and by the Treasurer or the Secretary or any Assistant Secretary of the Issuer and delivered to the Trustee. Each such certificate shall comply with Section 314 of the Trust Indenture Act of 1939 and include the statements provided for in Section 11.5. "OPINION OF COUNSEL" means an opinion in writing signed by legal counsel who may be an employee of or counsel to the Issuer and who shall be satisfactory to the Trustee. Each such opinion shall comply with Section 314 of the Trust Indenture Act of 1939 and include the statements provided for in Section 11.5, if and to the extent required hereby. "ORIGINAL ISSUE DATE" of any Security (or portion thereof) means the earlier of (a) the date of such Security or (b) the date of any Security (or portion thereof) for which such Security was issued (directly or indirectly) on registration of transfer, exchange or substitution. 3 10 "ORIGINAL ISSUE DISCOUNT SECURITY" means any Security that provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the maturity thereof pursuant to Section 5.1. "OUTSTANDING", when used with reference to Securities, shall, subject to the provisions of Section 7.4, mean, as of any particular time, all Securities authenticated and delivered by the Trustee under this Indenture, except (a) Securities theretofore canceled by the Trustee or delivered to the Trustee for cancellation; (b) Securities, or portions thereof, for the payment or redemption of which moneys in the necessary amount shall have been deposited in trust with the Trustee or with any paying agent (other than the Issuer) or shall have been set aside, segregated and held in trust by the Issuer for the holders of such Securities (if the Issuer shall act as its own paying agent), provided that if such Securities, or portions thereof, are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as herein provided, or provision satisfactory to the Trustee shall have been made for giving such notice; and (c) Securities in substitution for which other Securities shall have been authenticated and delivered, or which shall have been paid, pursuant to the terms of Section 2.9 (except with respect to any such Security as to which proof satisfactory to the Trustee is presented that such Security is held by a person in whose hands such Security is a legal, valid and binding obligation of the Issuer). In determining whether the holders of the requisite principal amount of Outstanding Securities of any or all series have given any request, demand, authorization, direction, notice, consent or waiver hereunder, (i) the principal amount of an Original Issue Discount Security that shall be deemed to be Outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the maturity thereof pursuant to Section 5.1 and (ii) the principal amount of any Security denominated in a foreign currency or currencies shall be the U.S. dollar equivalent, determined on the original issue date of such Security, of the principal amount (or in the case of an Original Issue Discount Security, the U.S. dollar equivalent on the original issue date of such Security of the amount determined as provided for in (i) above) for such Security. 4 11 "PERIODIC OFFERING" means an offering of Securities of a series from time to time, the specific terms of which Securities, including, without limitation, the rate or rates of interest, if any, thereon, the stated maturity or maturities thereof and the redemption provisions, if any, with respect thereto, are to be determined by the Issuer or its agents upon the issuance of such Securities pursuant to Section 2.3. "PERSON" means any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. "PRINCIPAL", whenever used with reference to the Securities or any Security or any portion thereof, shall be deemed to include "and premium, if any". "RESPONSIBLE OFFICER", when used with respect to the Trustee, means the Chairman of the Board of Directors, any Vice Chairman of the Board of Directors, the Chairman of the Trust Committee, the Chairman of the Executive Committee, any Vice Chairman of the Executive Committee, the President, any Vice President, the Cashier, the Secretary, the Treasurer, any Trust Officer, any Assistant Trust Officer, any Assistant Vice President, any Assistant Cashier, any Assistant Secretary, any Assistant Treasurer, or any other officer or assistant officer of the Trustee customarily performing functions similar to those performed by the persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of his knowledge of and familiarity with the particular subject. "SECURITY" or "SECURITIES" has the meaning stated in the first recital of this Indenture, or, as the case may be, Securities that have been authenticated and delivered under this Indenture. "SELF-LIQUIDATING PAPER" means any draft, bill of exchange, acceptance or obligation which is made, drawn, negotiated or incurred by the Issuer for the purpose of financing the purchase, processing, manufacture, shipment, storage or sale of goods, wares or merchandise and which is secured by documents evidencing title to, possession of, or a lien upon the goods, wares or merchandise or the receivables or proceeds arising from the sale of the goods, wares or merchandise previously constituting the security, provided the security is received by the Trustee simultaneously with the creation of the creditor relationship with the Issuer arising from the making, drawing, negotiating or incurring of the draft, bill of exchange, acceptance or obligation. 5 12 "SENIOR INDEBTEDNESS" shall have the meaning given to that term in Section 14.1. "TRUSTEE" means the Person identified as "Trustee" in the first paragraph hereof and, subject to the provisions of Article Six, shall also include any successor trustee. "TRUST INDENTURE ACT OF 1939" means the Trust Indenture Act of 1939, as amended, as in force at the date as of which this Indenture was originally executed. "VICE PRESIDENT", when used with respect to the Issuer or the Trustee, means any vice president, whether or not designated by a number or a word or words added before or after the title of "Vice President". "YIELD TO MATURITY" means the yield to maturity on a series of securities, calculated at the time of issuance of such series, or, if applicable, at the most recent redetermination of interest on such series, and calculated in accordance with accepted financial practice. ARTICLE 2 SECURITIES SECTION 2.1. FORMS GENERALLY. The Securities of each series shall be substantially in such form (not inconsistent with this Indenture) as shall be established by or pursuant to a Board Resolution (as set forth in the Board Resolution or, to the extent established pursuant to rather than set forth in the Board Resolution, an Officers' Certificate detailing such establishment) or in one or more indentures supplemental hereto, in each case with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture and may have imprinted or otherwise reproduced thereon such legend or legends, not inconsistent with the provisions of this Indenture, as may be required to comply with any law or with any rules or regulations pursuant thereto, or with any rules of any securities exchange or to conform to general usage, all as may be determined by the officers executing such Securities, as evidenced by their execution of the Securities. The definitive Securities shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all as determined by the officers executing such Securities, as evidenced by their execution of such Securities. 6 13 SECTION 2.2. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION. The Trustee's certificate of authentication on all Securities shall be in substantially the following form: This is one of the Securities of the series designated herein and referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By_____________________ Authorized Officer SECTION 2.3. 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 in a Board Resolution or to the extent established pursuant to (rather than set forth in) such Board Resolutions in an Officers' Certificate detailing such establishment, or established in one or more indentures supplemental hereto, prior to the initial issuance of Securities of any series, (a) the title of the Securities of the series (which shall distinguish the Securities of the series from all other Securities); (b) any limit upon the aggregate principal amount of the Securities of the series that 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 2.8, 2.9, 2.11, 8.5 or 12.3); (c) the date or dates on which the principal of the Securities of the series is payable; (d) the rate or rates at which the Securities of the series shall bear interest, if any, or the method by which such rate shall be determined, the date or dates from which such interest shall accrue, the interest payment dates on which such interest shall be payable and the record dates for the determination of Holders to whom interest is payable; 7 14 (e) the place or places where the principal of and any interest on Securities of the series shall be payable (if other than as provided in Section 3.2); (f) the price or prices at which, the period or periods within which and the terms and conditions upon which Securities of the series may be redeemed, in whole or in part, at the option of the Issuer, pursuant to any sinking fund or otherwise; (g) the obligation, if any, of the Issuer to redeem, purchase or repay Securities of the series pursuant to any mandatory redemption, sinking fund or analogous provisions or at the option of a Holder thereof and the price or prices at which and the period or periods within which and the terms and conditions upon which Securities of the series shall be redeemed, purchased or repaid, in whole or in part, pursuant to such obligation; (h) if other than as set forth in Article Thirteen, the terms of any right to convert Securities of the series into shares of Common Stock of the Issuer or other securities or property; (i) if other than denominations of $1,000 and any integral multiple thereof, the denominations in which Securities of the series shall be issuable; (j) if other than the principal amount thereof, the portion of the principal amount of Securities of the series which shall be payable upon declaration of acceleration of the maturity thereof pursuant to Section 5.1 or provable in bankruptcy pursuant to Section 5.2; (k) if other than as set forth in Section 5.1, any Event of Default with respect to the Securities of the series, if not set forth herein; (l) any other terms of the series (which terms shall not be inconsistent with the provisions of this Indenture); (m) any trustees, authenticating or paying agents, transfer agents or registrars or any other agents with respect to the Securities of such series; (n) if other than the coin or currency in which the Securities of that series are denominated, the coin or currency in which payment of the principal of or interest on the Securities of such series shall be payable; 8 15 (o) if the principal of or interest on the Securities of such series are to be payable, at the election of the Issuer or a Holder thereof, in a coin or currency other than that in which the Securities are denominated, the period or periods within which, and the terms and conditions upon which, such election may be made; (p) if the amount of payments of principal of and interest on the Securities of the series may be determined with reference to an index, the manner in which such amounts shall be determined; (q) whether and under what circumstances the Issuer will pay additional amounts on the Securities of the series held by a person who is not a U.S. person in respect of any tax, assessment or governmental charge withheld or deducted and, if so, whether the Issuer will have the option to redeem such Securities rather than pay such additional amounts; (r) if the Securities of such series are to be issuable in definitive form (whether upon original issue or upon exchange of a temporary Security of such series) only upon receipt of certain certificates or other documents or satisfaction of other conditions, the form and terms of such certificates, documents or conditions; and (s) any other affirmative or negative covenants with respect to the Securities of such 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 or Officers' Certificate referred to above or as set forth in any such indenture supplemental hereto. All Securities of any one series need not be issued at the same time and may be issued from time to time, consistent with the terms of the Indenture, if so provided by or pursuant to such Board Resolution, such Officers' Certificate or in any such indenture supplemental hereto. SECTION 2.4. AUTHENTICATION AND DELIVERY OF SECURITIES. At any time and from time to time after the execution and delivery of this Indenture, the Issuer may deliver Securities of any series executed by the Issuer to the Trustee for authentication together with the applicable documents referred to below in this Section, and the Trustee shall thereupon authenticate and deliver such Securities to or upon the order of the Issuer (contained in the Issuer Order referred to below in this Section) or pursuant to such procedures acceptable to the Trustee as may be specified from time to time by an Issuer Order. The maturity date, original issue date, interest rate and 9 16 any other terms of the Securities of such series may be determined by or pursuant to such Issuer Order and procedures. Such Issuer Order may authorize authentication and delivery pursuant to oral instructions from the Issuer or its duly authorized agent, which instructions shall be promptly confirmed in writing. In authenticating such Securities and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, before the first authentication of Securities of such series, and (subject to Section 6.1) shall be fully protected in relying upon: (a) an Issuer Order requesting such authentication and setting forth delivery instructions if the Securities are not to be delivered to the Issuer, provided that, with respect to Securities of a series subject to a Periodic Offering, such Issuer Order may provide procedures acceptable to the Trustee for the completion of authentication and delivery of securities from time to time pursuant to oral or electronic instructions from the Issuer or its duly authorized agent or agents, which oral instructions shall be promptly confirmed in writing; (b) any Board Resolution, Officers' Certificate or executed supplemental indenture referred to in Sections 2.1 and 2.3 by or pursuant to which the forms and terms of the Securities were established; (c) an Opinion of Counsel, prepared in accordance with Section 11.5, which shall state (i) that the form or forms and terms of such Securities have been, or will be when any conditions specified in such Opinion of Counsel are satisfied, duly authorized by the Issuer and established in conformity with the provisions of this Indenture; and (ii) that such Securities, when authenticated and delivered by the Trustee and issued by the Issuer in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and binding obligations of the Issuer. The Trustee shall have the right to decline to authenticate and deliver any Securities under this Section if the Trustee, being advised by counsel, determines that such action may not lawfully be taken by the Issuer or if the Trustee in good faith by its Board of Directors or Board of Trustees, Executive Committee, or a Trust Committee of Directors or Trustees or Responsible Officers shall determine that such action would expose the Trustee to personal liability to existing Holders. 10 17 SECTION 2.5. EXECUTION OF SECURITIES. The Securities shall be signed on behalf of the Issuer by both (a) its Chairman or its Vice Chairman or its President or any Vice President and (b) by its Treasurer or its Secretary or any Assistant Secretary, under its corporate seal which may, but need not, be attested. Such signatures may be the manual or facsimile signatures of the present or any future such officers. The seal of the Issuer may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Securities. Typographical and other minor errors or defects in any such reproduction of the seal or any such signature shall not affect the validity or enforceability of any Security that has been duly authenticated and delivered by the Trustee. In case any officer of the Issuer who shall have signed any of the Securities shall cease to be such officer before the Security so signed shall be authenticated and delivered by the Trustee or disposed of by the Issuer, such Security nevertheless may be authenticated and delivered or disposed of as though the person who signed such Security had not ceased to be such officer of the Issuer; and any Security may be signed on behalf of the Issuer by such persons as, at the actual date of the execution of such Security, shall be the proper officers of the Issuer, although at the date of the execution and delivery of this Indenture any such person was not such an officer. SECTION 2.6. CERTIFICATE OF AUTHENTICATION. Only such Securities as shall bear thereon a certificate of authentication substantially in the form hereinbefore recited, executed by the Trustee by the manual signature of one of its authorized officers, shall be entitled to the benefits of this Indenture or be valid or obligatory for any purpose. Such certificate by the Trustee upon any Security executed by the Issuer shall be conclusive evidence that the Security so authenticated has been duly authenticated and delivered hereunder and that the holder is entitled to the benefits of this Indenture. SECTION 2.7. DENOMINATION AND DATE OF SECURITIES; PAYMENTS OF INTEREST. The Securities of each series shall be issuable as registered securities without coupons and in denominations as shall be specified as contemplated by Section 2.3. In the absence of any such specification with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $1,000 and any multiple thereof. The Securities of each series shall be numbered, lettered, or otherwise distinguished in such manner or in accordance with such plan as the officers of the Issuer executing the same may determine with the approval of the Trustee as evidenced by the execution and authentication thereof. 11 18 Each Security shall be dated the date of its authentication, and shall bear interest, if any, from the date and shall be payable on the dates, in each case, which shall be specified as contemplated by Section 2.3. The person in whose name any Security of any series is registered at the close of business on any record date applicable to a particular series with respect to any interest payment date for such series shall be entitled to receive the interest, if any, payable on such interest payment date notwithstanding any transfer or exchange of such Security subsequent to the record date and prior to such interest payment date, except if and to the extent the Issuer shall default in the payment of the interest due on such interest payment date for such series, in which case such defaulted interest shall then cease to be payable to the Holder on such record date by virtue of having been such Holder and shall be paid to the persons in whose names Outstanding Securities for such series are registered at the close of business on a subsequent record date (which shall be not less than five Business Days prior to the date of payment of such defaulted interest) established by notice given by mail by or on behalf of the Issuer to the holders of Securities not less than 15 days preceding such subsequent record date. The term "record date" as used with respect to any interest payment date (except a date for payment of defaulted interest) shall mean the date specified as such in the terms of the Securities of any particular series, or, if no such date is so specified, if such interest payment date is the first day of a calendar month, the fifteenth day of the next preceding calendar month or, if such interest payment date is the fifteenth day of a calendar month, the first day of such calendar month, whether or not such record date is a Business Day. Subject to the provisions of Section 13.2, in the case of any Security which is converted after any applicable record date with respect to any interest payment date and on or prior to the next succeeding interest payment date (other than any Security the principal of (or premium, if any, on) which shall become due and payable, whether at final maturity or by declaration of acceleration, call for redemption, or otherwise prior to such next succeeding interest payment date), interest whose final maturity is on such interest payment date shall be payable on such interest payment date notwithstanding such conversion and such interest (whether or not punctually paid or duly provided for) shall be paid to the person in whose name that Security (or any one or more predecessor Securities) is registered at the close of business on such record date. Except as otherwise expressly provided in the immediately preceding sentence, in the case of any Security which is converted, 12 19 interest whose final maturity is after the date of conversion of such Security shall not be payable. SECTION 2.8. REGISTRATION, TRANSFER AND EXCHANGE. The Issuer will keep at each office or agency to be maintained for the purpose as provided in Section 3.2 for each series of securities a register or registers in which, subject to such reasonable regulations as it may prescribe, it will register, and will register the transfer of, Securities of such series as in this Article provided. Such register shall be in written form in the English language or in any other form capable of being converted into such form within a reasonable time. At all reasonable times such register or registers shall be open for inspection by the Trustee. Upon due presentation for registration of transfer of any Security of any series at any such office or agency to be maintained for the purpose as provided in Section 3.2, the Issuer shall execute and the Trustee shall authenticate and deliver in the name of the transferee or transferees a new Security or Securities of like tenor and aggregate principal amount. Any Security or Securities of any series may be exchanged for a Security or Securities of the same series in other authorized denominations, of like tenor and in an equal aggregate principal amount. Securities of any series to be exchanged shall be surrendered at any office or agency to be maintained by the Issuer for the purpose as provided in Section 3.2, and the Issuer shall execute and the Trustee shall authenticate and deliver in exchange therefor the Security or Securities of the same series which the Securityholder making the exchange shall be entitled to receive, bearing numbers not contemporaneously outstanding. All Securities presented for registration of transfer, exchange, redemption or payment shall (if so required by the Issuer or the Trustee) be duly endorsed by, or be accompanied by a written instrument or instruments of transfer in form satisfactory to the Issuer and the Trustee duly executed by, the Holder or the Holder's attorney duly authorized in writing. The Issuer may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any exchange or registration of transfer of Securities. No service charge shall be made for any such transaction. The Issuer shall not be required to exchange or register a transfer of (a) any Securities of any series for a period of 15 days next preceding the first mailing of notice of 13 20 redemption of Securities of such series to be redeemed, or (b) any Securities selected, called or being called for redemption, in whole or in part, except, in the case of any Security where public notice has been given that such Security is to be redeemed in part, the portion thereof not so to be redeemed. All Securities issued upon any transfer or exchange of Securities shall be valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such transfer or exchange. SECTION 2.9. MUTILATED, DEFACED, DESTROYED, LOST AND STOLEN SECURITIES. In case any temporary or definitive Security shall become mutilated, defaced or be destroyed, lost or stolen, the Issuer in its discretion may execute, and upon the written request of any officer of the Issuer, the Trustee shall authenticate and deliver, a new Security of the same series and tenor, bearing a number not contemporaneously outstanding, in exchange and substitution for the mutilated or defaced Security, or in lieu of and substitution for the Security so destroyed, lost or stolen. In every case the applicant for a substitute Security shall furnish to the Issuer and to the Trustee and any agent of the Issuer or the Trustee such security or indemnity as may be required by them to indemnify and defend and to save each of them harmless and, in every case of destruction, loss or theft, evidence to their satisfaction of the destruction, loss or theft of such Security and of the ownership thereof and in the case of mutilation or defacement shall surrender such Security to the Trustee. Upon the issuance of any substitute Security, the Issuer 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. In case any Security which has matured or is about to mature or has been called for redemption in full shall become mutilated or defaced or be destroyed, lost or stolen, the Issuer may instead of issuing a substitute Security, pay or authorize the payment of the same (without surrender thereof except in the case of a mutilated or defaced Security), if the applicant for such payment shall furnish to the Issuer and to the Trustee and any agent of the Issuer or the Trustee such security or indemnity as any of them may require to save each of them harmless, and, in every case of destruction, loss or theft, the applicant shall also furnish to the Issuer and the Trustee and any agent of the Issuer or the Trustee evidence to their satisfaction of the destruction, loss or theft of such Security and of the ownership thereof. 14 21 Every substitute Security of any series issued pursuant to the provisions of this Section by virtue of the fact that any such Security is destroyed, lost or stolen shall constitute an additional contractual obligation of the Issuer, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of (but shall be subject to all the limitations of rights set forth in) this Indenture equally and proportionately with any and all other Securities of such series duly authenticated and delivered hereunder. All Securities shall be held and owned upon the express condition that, to the extent permitted by law, the foregoing provisions are exclusive with respect to the replacement or payment of mutilated, defaced or destroyed, lost or stolen Securities and shall preclude any and all other rights or remedies notwithstanding any law or statute existing or hereafter enacted to the contrary with respect to the replacement or payment of negotiable instruments or other securities without their surrender. SECTION 2.10. CANCELLATION OF SECURITIES; DESTRUCTION THEREOF. All Securities surrendered for payment, redemption, registration of transfer or exchange, or for credit against any payment in respect of a sinking or analogous fund, or for conversion, if surrendered to the Issuer or any agent of the Issuer or the Trustee, shall be delivered to the Trustee for cancellation or, if surrendered to the Trustee, shall be canceled by it; and no Securities shall be issued in lieu thereof except as expressly permitted by any of the provisions of this Indenture. The Trustee shall destroy canceled Securities held by it and deliver a certificate of destruction to the Issuer. If the Issuer shall acquire any of the Securities, such acquisition shall not operate as a redemption or satisfaction of the indebtedness represented by such Securities unless and until the same are delivered to the Trustee for cancellation. SECTION 2.11. TEMPORARY SECURITIES. Pending the preparation of definitive Securities for any series, the Issuer may execute and the Trustee shall authenticate and deliver temporary Securities for such series (printed, lithographed, typewritten or otherwise reproduced, in each case in form satisfactory to the Trustee). Temporary Securities of any series shall be issuable as registered Securities without coupons, of any authorized denomination, and substantially in the form of the definitive Securities of such series but with such omissions, insertions and variations as may be appropriate for temporary Securities, all as may be determined by the Issuer with the concurrence of the Trustee as evidenced by the execution and authentication thereof. Temporary Securities may contain such reference to any provisions of this Indenture as may be appropriate. Every temporary Security shall be executed by the 15 22 Issuer and be authenticated by the Trustee upon the same conditions and in substantially the same manner, and with like effect, as the definitive Securities. Without unreasonable delay the Issuer shall execute and shall furnish definitive Securities of such series and thereupon temporary Securities of such series may be surrendered in exchange therefor without charge at each office or agency to be maintained by the Issuer for that purpose pursuant to Section 3.2, and the Trustee shall authenticate and deliver in exchange for such temporary Securities of such series 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 be entitled to the same benefits under this Indenture as definitive Securities of such series. ARTICLE 3 COVENANTS OF THE ISSUER SECTION 3.1. PAYMENT OF PRINCIPAL AND INTEREST. The Issuer covenants and agrees for the benefit of each series of Securities that it will duly and punctually pay or cause to be paid the principal of, and interest on, each of the Securities of such series at the place or places, at the respective times and in the manner provided in such Securities and this Indenture. Each installment of interest on the Securities of any series may be paid by mailing checks for such interest payable to or upon the written order of the holders of Securities entitled thereto as they shall appear on the registry books of the Issuer. SECTION 3.2. OFFICES FOR PAYMENTS, ETC. So long as any of the Securities remain outstanding, the Issuer will maintain in the Borough of Manhattan, the City of New York, the following for each series: an office or agency (a) where the Securities may be presented for payment, (b) where the Securities may be presented for registration of transfer and for exchange as in this Indenture provided and (c) where notices and demands to or upon the Issuer in respect of the Securities or of this Indenture may be served. The Issuer will give to the Trustee written notice of the location of any such office or agency and of any change of location thereof. Unless otherwise specified in accordance with Section 2.3, the Issuer hereby initially designates the corporate trust office of The First National Bank of Chicago, 14 Wall Street, Eighth Floor, New York, New York, 10005 (the "Corporate Trust Office"), as the office to be maintained by it for each such purpose in the Borough of Manhattan, the City of New York. In case the Issuer shall fail to so designate or maintain any such office or agency or shall fail to give such notice of the location or of any change in the 16 23 location thereof, presentations, surrenders and demands may be made and notices may be served at the Corporate Trust Office. SECTION 3.3. APPOINTMENT TO FILL A VACANCY IN OFFICE OF TRUSTEE. The Issuer, whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided in Section 6.9, a Trustee, so that there shall at all times be a Trustee with respect to each series of Securities hereunder. SECTION 3.4. PAYING AGENTS. Whenever the Issuer shall appoint a paying agent other than the Trustee with respect to the Securities of any series, it will cause such paying agent to execute and deliver to the Trustee an instrument in which such agent shall agree with the Trustee, subject to the provisions of this Section, (a) that it will hold all sums received by it as such agent for the payment of the principal of or interest on the Securities of such series (whether such sums have been paid to it by the Issuer or by any other obligor on the Securities of such series) in trust for the benefit of the holders of the Securities of such series or of the Trustee; (b) that it will give the Trustee notice of any failure by the Issuer (or by any other obligor on the Securities of such series) to make any payment of the principal of or interest on the Securities of such series when the same shall be due and payable; and (c) at any time during the continuance of any such default, upon written request of the Trustee, forthwith to pay to the Trustee all sums so held in trust by the paying agent. The Issuer will, on or prior to each due date of the principal of or interest on the Securities of such series, deposit with the paying agent a sum sufficient to pay such principal or interest so becoming due, and (unless such paying agent is the Trustee) the Issuer will promptly notify the Trustee of any failure to take such action. If the Issuer shall act as its own paying agent with respect to the Securities of any series, it will, on or before each due date of the principal of or interest on the Securities of such series, set aside, segregate and hold in trust for the benefit of the holders of the Securities of such series a sum sufficient to pay such principal or interest so becoming due. The Issuer will promptly notify the Trustee of any failure to take such action. 17 24 Anything in this Section to the contrary notwithstanding, the Issuer may at any time, for the purpose of obtaining a satisfaction and discharge with respect to one or more or all series of Securities hereunder, or for any other reason, pay or cause to be paid to the Trustee all sums held in trust for any such series by the Issuer or any paying agent hereunder, as required by this Section, such sums to be held by the Trustee upon the trusts herein contained. Anything in this Section to the contrary notwithstanding, the agreement to hold sums in trust as provided in this Section is subject to the provisions of Sections 10.3 and 10.4. SECTION 3.5. CERTIFICATE OF THE ISSUER. The Issuer will deliver to the Trustee on or before May 1 in each year (beginning with 1996) a brief certificate (which need not comply with Section 11.5) from the principal executive, financial or accounting officer of the Issuer as to his or her knowledge of the Issuer's compliance with all conditions and covenants under the Indenture (such compliance to be determined without regard to any period of grace or requirements of notice provided under the Indenture). SECTION 3.6. CORPORATE EXISTENCE. Subject to Article Nine, the Issuer will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence, rights (charter and statutory) and franchises; provided, however, that the Issuer shall not be required to preserve any such right or franchise if it shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Issuer. ARTICLE 4 SECURITYHOLDERS' LISTS AND REPORTS BY THE ISSUER AND THE TRUSTEE SECTION 4.1. SECURITYHOLDERS' LISTS. If and so long as the Trustee shall not be the Security registrar for the Securities of any series, the Issuer will furnish or cause to be furnished to the Trustee a list in such form as the Trustee may reasonably require of the names and addresses of the holders of the Securities of each series pursuant to Section 312 of the Trust Indenture Act of 1939: (a) semi-annually not more than 15 days after each record date for the payment of interest on such Securities, as hereinabove specified, as of such record date and on dates to be 18 25 determined pursuant to Section 2.3 for non-interest bearing securities in each year, and (b) at such other times as the Trustee may request in writing, within 30 days after receipt by the Issuer of any such request as of a date not more than 15 days prior to the time such information is furnished. SECTION 4.2. REPORTS BY THE ISSUER. The Issuer covenants to file with the Trustee, within 15 days after the Issuer is required to file the same with the Commission, copies of the annual reports and of the information, documents, and other reports which the Issuer may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934. SECTION 4.3. REPORTS BY THE TRUSTEE. Any Trustee's Report required under Section 313(a) of the Trust Indenture Act of 1939 shall be transmitted on or before July 15 in each year following the date hereof, so long as any Securities are outstanding hereunder, and be dated as of a date convenient to the Trustee but no more than 60 nor less than 45 days prior thereto. ARTICLE 5 REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT SECTION 5.1. EVENT OF DEFAULT DEFINED; ACCELERATION OF MATURITY; WAIVER OF DEFAULT. "Event of Default" with respect to Securities of any series wherever used herein, means each one of the following events which shall have occurred and be continuing (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body): (a) default in the payment of any installment of interest upon any of the Securities of such series as and when the same shall become due and payable, and continuance of such default for a period of 30 days; or (b) default in the payment of all or any part of the principal of any of the Securities of such series as and when the same shall become due and payable either at maturity, upon redemption, by declaration or otherwise; or 19 26 (c) default in the payment of any sinking fund installment as and when the same shall become due and payable by the terms of the Securities of such series; or (d) default in the performance, or breach, of any covenant or warranty of the Issuer in respect of the Securities of such series (other than a covenant or warranty in respect of the Securities of such series a default in whose performance or whose breach is elsewhere in this Section specifically dealt with), and continuance of such default or breach for a period of 90 days after there has been given, by registered or certified mail, to the Issuer by the Trustee or to the Issuer and the Trustee by the Holders of at least 25% in principal amount of the Outstanding Securities of all series affected thereby, a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a "Notice of Default" hereunder; or (e) a court having jurisdiction in the premises shall enter a decree or order for relief in respect of the Issuer in an involuntary case under any applicable bankruptcy, insolvency, reorganization or other similar law now or hereafter in effect, or a decree or order adjudging the Issuer a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, assignment, adjustment or composition of, as in respect of, the Issuer under any applicable federal or state law or appointing a receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the Issuer or for any substantial part of its property or ordering the winding up or liquidation of its affairs, and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or (f) the Issuer shall commence a voluntary case under any applicable bankruptcy, insolvency, reorganization or other similar law now or hereafter in effect or any other case to be adjudicated a bankrupt or insolvent, or consent to the filing of such petition or to the entry of an order for relief in an involuntary case under any such law or to the commencement of any bankruptcy or insolvency proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable state or federal law, or consent to the filing of such petition or the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the Issuer or for any substantial part of its property, or make any general assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due, or the taking of corporate action in furtherance of such bankruptcy; or 20 27 (g) any other Event of Default established pursuant to Section 2.3 for the Securities for such series. If an Event of Default described in clauses (a), (b), (c), (d) or (g) above (if the Event of Default under clause (d) is with respect to less than all series of Securities then Outstanding) occurs and is continuing, then, and in each and every such case, unless the principal of all of the Securities of such series shall have already become due and payable, either the Trustee or the holders of not less than 25% in aggregate principal amount of the Securities of such series then Outstanding hereunder (each such series voting as a separate class) by notice in writing to the Issuer (and to the Trustee if given by Securityholders), may declare the entire principal (or, if the Securities of such series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series) of all Securities of such series and the interest accrued thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable. If an Event of Default described in clause (d) (if the Event of Default under clause (d) is with respect to all series of Securities then Outstanding), (e) or (f) occurs and is continuing, then and in each and every such case, unless the principal of all the Securities shall have already become due and payable, either the Trustee or the Holders of not less than 25% in aggregate principal amount of all the Securities then Outstanding hereunder (treated as one class), by notice in writing to the Issuer (and to the Trustee if given by Securityholders), may declare the entire principal (or, if any Securities are Original Issue Discount Securities, such portion of the principal as may be specified in the terms thereof) of all the Securities then outstanding and interest accrued thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable. The foregoing provisions, however, are subject to the condition that if, at any time after the principal (or, if the Securities of such series are Original Issue Discount Securities, such portion of the principal as may be specified in the terms thereof) of the Securities of any series shall have been so declared due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered as hereinafter provided, the Issuer shall pay or shall deposit with the Trustee a sum sufficient to pay all matured installments of interest upon all the Securities of such series and the principal of any and all Securities of such series which shall have become due otherwise than by acceleration (with interest upon such principal and, to the extent that payment of such interest is enforceable under applicable law, on overdue installments of interest, at the same rate as the rate of 21 28 interest or Yield to Maturity (in the case of Original Issue Discount Securities) specified in the Securities of such series, (or at the respective rates of interest or Yields to Maturity of all the Securities, as the case may be) to the date of such payment or deposit) and such amount as shall be sufficient to cover reasonable compensation to the Trustee, its agents, attorneys and counsel, and all other expenses and liabilities incurred, and all advances made, by the Trustee except as a result of negligence or bad faith, and if any and all Events of Default under the Indenture, other than the non-payment of the principal of Securities of such series which shall have become due by acceleration, shall have been cured, waived or otherwise remedied as provided herein--then and in every such case the holders of a majority in aggregate principal amount of all the Securities of such series, each series voting as a separate class by written notice to the Issuer and to the Trustee, may waive all defaults with respect to such series and rescind and annul such declaration and its consequences, but no such waiver or rescission and annulment shall extend to or shall affect any subsequent default or shall impair any right consequent thereon. For all purposes under this Indenture, if a portion of the principal of any Original Issue Discount Securities shall have been accelerated and declared due and payable pursuant to the provisions hereof, then, from and after such declaration, unless such declaration has been rescinded and annulled, the principal amount of such Original Issue Discount Securities shall be deemed, for all purposes hereunder, to be such portion of the principal thereof as shall be due and payable as a result of such acceleration, and payment of such portion of the principal thereof as shall be due and payable as a result of such acceleration, together with interest, if any, thereon and all other amounts owing thereunder, shall constitute payment in full of such Original Issue Discount Securities. SECTION 5.2. COLLECTION OF INDEBTEDNESS BY TRUSTEE; TRUSTEE MAY PROVE DEBT. The Issuer covenants that (a) in case default shall be made in the payment of any installment of interest on any of the Securities of any series when such interest shall have become due and payable, and such default shall have continued for a period of 30 days or (b) in case default shall be made in the payment of all or any part of the principal of any of the Securities of any series when the same shall have become due and payable, whether upon maturity of the Securities of such series or upon any redemption or by declaration or otherwise (including any payments to any sinking fund or analogous obligation) then upon demand of the Trustee, the Issuer will pay to the Trustee for the benefit of the Holders of the Securities of such series the whole amount that then shall have become due and payable on all Securities of series for 22 29 principal (including any payments to any sinking fund or analogous obligation) or interest, as the case may be (with interest to the date of such payment upon the overdue principal and, to the extent that payment of such interest is enforceable under applicable law, on overdue installments of interest at the same rate as the rate of interest or Yield to Maturity (in the case of Original Issue Discount Securities) specified in the Securities of such series); and in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including reasonable compensation to the Trustee and each predecessor Trustee, their respective agents, attorneys and counsel, and any expenses and liabilities incurred, and all advances made, by the Trustee and each predecessor Trustee except as a result of its negligence or bad faith. Until such demand is made by the Trustee, the Issuer may pay the principal of and interest on the Securities of any series to the registered holders, whether or not the principal of and interest on the Securities of such series be overdue. In case the Issuer shall fail forthwith to pay such amounts upon such demand, the Trustee, in its own name and as trustee of an express trust, shall be entitled and empowered to institute any action or proceedings at law or in equity for the collection of the sums so due and unpaid, and may prosecute any such action or proceedings to judgment or final decree, and may enforce any such judgment or final decree against the Issuer or other obligor upon such Securities and collect in the manner provided by law out of the property of the Issuer or other obligor upon such Securities, wherever situated, the moneys adjudged or decreed to be payable. In case there shall be pending proceedings relative to the Issuer or any other obligor upon the Securities under Title 11 of the United States Code or any other applicable Federal or state bankruptcy, insolvency or other similar law, or in case a receiver, assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator or similar official shall have been appointed for or taken possession of the Issuer or its property or such other obligor, or in case of any other comparable judicial proceedings relative to the Issuer or other obligor upon the Securities of any series, or to the creditors or property of the Issuer or such other obligor, the Trustee, irrespective of whether the principal of any Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand pursuant to the provisions of this Section, shall be entitled and empowered, by intervention in such proceedings or otherwise: 23 30 (a) to file and prove a claim or claims for the whole amount of principal and interest (or, if the Securities of any series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series) owing and unpaid in respect of the Securities of any series, and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for reasonable compensation to the Trustee and each predecessor Trustee, and their respective agents, attorneys and counsel, and for reimbursement of all expenses and liabilities incurred, and all advances made, by the Trustee and each predecessor Trustee, except as a result of negligence or bad faith) and of the Securityholders allowed in any judicial proceedings relative to the Issuer or other obligor upon the Securities of any series, or to the creditors or property of the Issuer or such other obligor, (b) unless prohibited by applicable law and regulations, to vote on behalf of the holders of the Securities of any series in any election of a trustee or a standby trustee in arrangement, reorganization, liquidation or other bankruptcy or insolvency proceedings or person performing similar functions in comparable proceedings, and (c) to collect and receive any moneys or other property payable or deliverable on any such claims, and to distribute all amounts received with respect to the claims of the Securityholders and of the Trustee on their behalf; and any trustee, receiver, or liquidator, custodian or other similar official is hereby authorized by each of the Securityholders to make payments to the Trustee, and, in the event that the Trustee shall consent to the making of payments directly to the Securityholders, to pay to the Trustee such amounts as shall be sufficient to cover reasonable compensation to the Trustee, each predecessor Trustee and their respective agents, attorneys and counsel, and all other expenses and liabilities incurred, and all advances made, by the Trustee and each predecessor Trustee except as a result of negligence or bad faith and all other amounts due to the Trustee or any predecessor Trustee pursuant to Section 6.6. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or vote for or accept or adopt on behalf of any Securityholder any plan or reorganization, arrangement, adjustment or composition affecting the Securities of any series or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Securityholder in any such proceeding except, as aforesaid, to vote for the election of a trustee in bankruptcy or similar person. 24 31 All rights of action and of asserting claims under this Indenture, or under any of the Securities, may be enforced by the Trustee without the possession of any of the Securities or the production thereof on any trial or other proceedings relative thereto, and any such action or proceedings instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment, subject to the payment of the expenses, disbursements and compensation of the Trustee, each predecessor Trustee and their respective agents and attorneys, shall be for the ratable benefit of the holders of the Securities in respect of which such action was taken. In any proceedings brought by the Trustee (and also any proceedings involving the interpretation of any provision of this Indenture to which the Trustee shall be a party) the Trustee shall be held to represent all the holders of the Securities in respect to which such action was taken, and it shall not be necessary to make any holders of such Securities parties to any such proceedings. SECTION 5.3. APPLICATION OF PROCEEDS. Any moneys collected by the Trustee pursuant to this Article in respect of any series shall be applied in the following order at the date or dates fixed by the Trustee and, in case of the distribution of such moneys on account of principal or interest, upon presentation of the several Securities in respect of which monies have been collected and stamping (or otherwise noting) thereon the payment, or issuing Securities of such series in reduced principal amounts in exchange for the presented Securities of like series if only partially paid, or upon surrender if fully paid: FIRST: To the payment of costs and expenses applicable to such series in respect of which monies have been collected, including reasonable compensation to the Trustee and each predecessor Trustee and their respective agents and attorneys and of all expenses and liabilities incurred, and all advances made, by the Trustee and each predecessor Trustee except as a result of negligence or bad faith, and all other amounts due to the Trustee or any predecessor Trustee pursuant to Section 6.6; SECOND: Subject to the provisions of Article Fourteen, in case the principal of the Securities of such series in respect of which moneys have been collected shall not have become and be then due and payable, to the payment of interest on the Securities of such series in default in the order of the maturity of the installments of such interest, with interest (to the extent that such interest has been collected by the Trustee) upon the overdue installments of 25 32 interest at the same rate as the rate of interest or Yield to Maturity (in the case of Original Issue Discount Securities) specified in such Securities, such payments to be made ratably to the persons entitled thereto, without discrimination or preference; THIRD: Subject to the provisions of Article Fourteen, in case the principal of the Securities of such series in respect of which moneys have been collected shall have become and shall be then due and payable, to the payment of the whole amount then owing and unpaid upon all the Securities of such series for principal and interest, with interest upon the overdue principal, and (to the extent that such interest has been collected by the Trustee) upon overdue installments of interest at the same rate as the rate of interest or Yield to Maturity (in the case of Original Issue Discount Securities) specified in the Securities of such series; and in case such moneys shall be insufficient to pay in full the whole amount so due and unpaid upon the Securities of such series, then to the payment of such principal and interest, without preference or priority of principal over interest, or of interest over principal, or of any installment of interest over any other installment of interest, or of any Security of such series over any other Security of such series, ratably to the aggregate of such principal and accrued and unpaid interest; and FOURTH: Subject to the provisions of Article Fourteen, to the payment of the remainder, if any, to the Issuer or any other person lawfully entitled thereto. SECTION 5.4. SUITS FOR ENFORCEMENT. In case an Event of Default has occurred, has not been waived and is continuing, the Trustee may in its discretion proceed to protect and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any of such rights, either at law or in equity or in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in this Indenture or in aid of the exercise of any power granted in this Indenture or to enforce any other legal or equitable right vested in the Trustee by this Indenture or by law. SECTION 5.5. RESTORATION OF RIGHTS ON ABANDONMENT OF PROCEEDINGS. In case the Trustee or any Holder shall have instituted any proceeding to enforce any right under this Indenture and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Trustee or to such Holder, then and in every such case the 26 33 Issuer and the Trustee shall be restored respectively to their former positions and rights hereunder, and all rights, remedies and powers of the Issuer, the Trustee and the Securityholders shall continue as though no such proceedings had been taken. SECTION 5.6. LIMITATIONS ON SUITS BY SECURITYHOLDERS. No holder of any Security of any series shall have any right by virtue or by availing of any provision of this Indenture to institute any action or proceeding at law or in equity or in bankruptcy or otherwise upon or under or with respect to this Indenture, or for the appointment of a trustee, receiver, liquidator, custodian or other similar official or for any other remedy hereunder, unless such holder previously shall have given to the Trustee written notice of default and of the continuance thereof, as hereinbefore provided, and unless also the holders of not less than 25% in aggregate principal amount of the Securities of such series then Outstanding shall have made written request upon the Trustee to institute such action or proceedings in its own name as trustee hereunder and shall have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or thereby and the Trustee for 60 days after its receipt of such notice, request and offer of indemnity shall have failed to institute any such action or proceeding and no direction inconsistent with such written request shall have been given to the Trustee pursuant to Section 5.9; it being understood and intended, and being expressly covenanted by the taker and Holder of every Security with every other taker and Holder and the Trustee, that no one or more Holders of Securities of any series shall have any right in any manner whatever by virtue or by availing of any provision of this Indenture to affect, disturb or prejudice the rights of any other such Holder of Securities, or to obtain or seek to obtain priority over or preference to any other such Holder or to enforce any right under this Indenture, except in the manner herein provided and for the equal, ratable and common benefit of all Holders of Securities of the applicable series. For the protection and enforcement of the provisions of this Section, each and every Securityholder and the Trustee shall be entitled to such relief as can be given either at law or in equity. SECTION 5.7. UNCONDITIONAL RIGHT OF SECURITYHOLDERS TO INSTITUTE CERTAIN SUITS. Notwithstanding any other provision in this Indenture and any provision of any Security, the right of any Holder of any Security to receive payment of the principal of and interest on such Security on or after the respective due dates expressed in such Security or to convert such Securities in accordance with Article Thirteen, or to institute suit for the enforcement of any such payment on or after such respective dates or any such right of conversion, shall not be impaired or affected without the consent of such Holder. 27 34 SECTION 5.8. POWERS AND REMEDIES CUMULATIVE; DELAY OR OMISSION NOT WAIVER OF DEFAULT. Except as provided in Section 5.6, no right or remedy herein conferred upon or reserved to the Trustee or to the Securityholders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. No delay or omission of the Trustee or of any Securityholder to exercise any right or power accruing upon any Event of Default occurring and continuing as aforesaid shall impair any such right or power or shall be construed to be a waiver of any such Event of Default or an acquiescence therein; and, subject to Section 5.6, every power and remedy given by this Indenture or by law to the Trustee or to the Securityholders may be exercised from time to time, and as often as shall be deemed expedient, by the Trustee or by the Securityholders. SECTION 5.9. CONTROL BY SECURITYHOLDERS. The Holders of a majority in aggregate principal amount of the Securities of each series affected (with each series voting as a separate class) at the time Outstanding shall have the right to direct the time, method, and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee with respect to the Securities of such series by this Indenture; provided that such direction shall not be otherwise than in accordance with law and the provisions of this Indenture and provided further that (subject to the provisions of Section 6.1) the Trustee shall have the right to decline to follow any such direction if the Trustee, being advised by counsel, shall determine that the action or proceeding so directed may not lawfully be taken or if the Trustee in good faith by its Board of Directors, the Executive Committee, or a Trust Committee of Directors or Responsible Officers of the Trustee shall determine that the action or proceedings so directed would involve the Trustee in personal liability or if the Trustee in good faith shall so determine that the actions or forebearances specified in or pursuant to such direction would be unduly prejudicial to the interests of Holders of the Securities of all series so affected not joining in the giving of said direction, it being understood that (subject to Section 6.1) the Trustee shall have no duty to ascertain whether or not such actions or forebearances are unduly prejudicial to such Holders. Nothing in this Indenture shall impair the right of the Trustee in its discretion to take any action deemed proper by the 28 35 Trustee and which is not inconsistent with such direction or directions by Securityholders. SECTION 5.10. WAIVER OF PAST DEFAULTS. Prior to a declaration of the acceleration of the maturity of the Securities of any series as provided in Section 5.1, the Holders of a majority in aggregate principal amount of the Securities of such series at the time Outstanding (each such series voting as a separate class) may on behalf of the Holders of all the Securities of such series waive any past default or Event of Default described in clause (c) of Section 5.1 (or, in the case of an event specified in clause (d) or (g) of Section 5.1 which relates to less than all series of Securities then Outstanding, the Holders of a majority in aggregate principal amount of the Securities then Outstanding affected thereby (each series voting as a separate class)) may waive any such default or Event of Default, or, in the case of an event specified in clause (d) or (g) (if the Event of Default under clause (d) relates to all series of Securities then Outstanding), (e) or (f) of Section 5.1 the Holders of Securities of a majority in principal amount of all the Securities then Outstanding (voting as one class) may waive any such default or Event of Default), and its consequences except a default in respect of a covenant or provision hereof which cannot be modified or amended without the consent of the Holder of each Security affected. In the case of any such waiver, the Issuer, the Trustee and the Holders of the Securities of such series shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon. Upon any such waiver, such default shall cease to exist and be deemed to have been cured and not to have occurred, and any Event of Default arising therefrom shall be deemed to have been cured, and not to have occurred for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or Event of Default or impair any right consequent thereon. SECTION 5.11. TRUSTEE TO GIVE NOTICE OF DEFAULT, BUT MAY WITHHOLD IN CERTAIN CIRCUMSTANCES. The Trustee shall transmit to the Securityholders of any series, as the names and addresses of such Holders appear on the registry books, notice by mail of all defaults known to the Trustee which have occurred with respect to such series, such notice to be transmitted within 90 days after the occurrence thereof, unless such defaults shall have been cured before the giving of such notice (the term "default" or "defaults" for the purposes of this Section being hereby defined to mean any event or condition which is, or with notice or lapse of time or both would become, an Event of 29 36 Default); provided that, except in the case of default in the payment of the principal of or interest on any of the Securities of such series, the Trustee shall be protected in withholding such notice if and so long as the Board of Directors, the Executive Committee, or a Trust Committee of Directors or Trustees and/or Responsible Officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Securityholders of such series. SECTION 5.12. RIGHT OF COURT TO REQUIRE FILING OF UNDERTAKING TO PAY COSTS. All parties to this Indenture agree, and each Holder of any Security by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Trustee, to any suit instituted by any Securityholder or group of Securityholders of any series holding in the aggregate more than 10% in aggregate principal amount of the Securities of such series, or, in the case of any suit relating to or arising under clause (d) of Section 5.1 (if the suit relates to Securities of more than one but less than all series), 10% in aggregate principal amount of Securities Outstanding affected thereby, or in the case of any suit relating to or arising under clause (d) (if the suit under clause (d) relates to all the Securities then Outstanding), (e) or (f) of Section 5.1, 10% in aggregate principal amount of all Securities Outstanding, or to any suit instituted by any Securityholder for the enforcement of the payment of the principal of or interest on any Security on or after the due date expressed in such Security. SECTION 5.13. WAIVER OF STAY OR EXTENSION LAWS. The Issuer covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. 30 37 ARTICLE 6 CONCERNING THE TRUSTEE SECTION 6.1. DUTIES AND RESPONSIBILITIES OF THE TRUSTEE; DURING DEFAULT; PRIOR TO DEFAULT. With respect to the Holders of any series of Securities issued hereunder, the Trustee, prior to the occurrence of an Event of Default with respect to the Securities of a particular series and after the curing or waiving of all Events of Default which may have occurred with respect to such series, undertakes to perform such duties and only such duties as are specifically set forth in this Indenture. In case an Event of Default with respect to the Securities of a series has occurred (which has not been cured or waived) the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act or its own wilful misconduct, except that: (a) prior to the occurrence of an Event of Default with respect to the Securities of any series and after the curing or waiving of all such Events of Default with respect to such series which may have occurred: (i) the duties and obligations of the Trustee with respect to the Securities of any Series shall be determined solely by the express provisions of this Indenture, and the Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (ii) in the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any statements, certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such statements, certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture; 31 38 (b) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer or Responsible Officers of the Trustee, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; and (c) the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the holders pursuant to Section 5.9 relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture. None of the provisions contained in this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur personal financial liability in the performance of any of its duties or in the exercise of any of its rights or powers, if there shall be reasonable ground for believing that the repayment of such funds or adequate indemnity against such liability is not reasonably assured to it. The provisions of this Section 6.1 are in furtherance of and subject to Sections 315 and 316 of the Trust Indenture Act of 1939. SECTION 6.2. CERTAIN RIGHTS OF THE TRUSTEE. In furtherance of and subject to the Trust Indenture Act of 1939 and subject to Section 6.1: (a) the Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, Officers' Certificate or any other certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, debenture, note, coupon, security or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties; (b) any request, direction, order or demand of the Issuer mentioned herein shall be sufficiently evidenced by an Officers' Certificate (unless other evidence in respect thereof be herein specifically prescribed); and any resolution of the Board of Directors may be evidenced to the Trustee by a copy thereof certified by the Secretary or an Assistant Secretary of the Issuer; (c) the Trustee may consult with counsel and any advice or Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, 32 39 suffered or omitted to be taken by it hereunder in good faith and in accordance with such advice or Opinion of Counsel; (d) the Trustee shall be under no obligation to exercise any of the trusts or powers vested in it by this Indenture at the request, order or direction of any of the Securityholders pursuant to the provisions of this Indenture, unless such Securityholders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred therein or thereby; (e) the Trustee shall not be liable for any action taken or omitted by it in good faith and believed by it to be authorized or within the discretion, rights or powers conferred upon it by this Indenture; (f) prior to the occurrence of an Event of Default hereunder and after the curing or waiving of all Events of Default, the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, appraisal, bond, debenture, note, coupon, security, or other paper or document unless requested in writing so to do by the holders of not less than a majority in aggregate principal amount of the Securities of all series affected then outstanding; provided that, if the payment within a reasonable time to the Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Trustee, not reasonably assured to the Trustee by the security afforded to it by the terms of this Indenture, the Trustee may require reasonable indemnity against such expenses or liabilities as a condition to proceeding; the reasonable expenses of every such investigation shall be paid by the Issuer or, if paid by the Trustee or any predecessor trustee, shall be repaid by the Issuer upon demand; and (g) the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys not regularly in its employ and the Trustee shall not be responsible for any misconduct or negligence on the part of any such agent or attorney appointed with due care by it hereunder. SECTION 6.3. TRUSTEE NOT RESPONSIBLE FOR RECITALS, DISPOSITION OF SECURITIES OR APPLICATION OF PROCEEDS THEREOF. The recitals contained herein and in the Securities, except the Trustee's certificates of authentication, shall be taken as the statements of the Issuer, and the Trustee assumes no responsibility for the correctness of the same. The Trustee makes no representation as to the validity or sufficiency of this 33 40 Indenture or of the Securities. The Trustee shall not be accountable for the use or application by the Issuer of any of the Securities or of the proceeds thereof. SECTION 6.4. TRUSTEE AND AGENTS MAY HOLD SECURITIES; COLLECTIONS, ETC. The Trustee or any agent of the Issuer or the Trustee, in its individual or any other capacity, may become the owner or pledgee of Securities with the same rights it would have if it were not the Trustee or such agent and may otherwise deal with the Issuer and receive, collect, hold and retain collections from the Issuer with the same rights it would have if it were not the Trustee or such agent. SECTION 6.5. MONEYS HELD BY TRUSTEE. Subject to the provisions of Section 10.4 hereof, all moneys received by the Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by mandatory provisions of law. Neither the Trustee nor any agent of the Issuer or the Trustee shall be under any liability for interest on any moneys received by it hereunder. SECTION 6.6. COMPENSATION AND INDEMNIFICATION OF TRUSTEE AND ITS PRIOR CLAIM. The Issuer covenants and agrees to pay to the Trustee from time to time, and the Trustee shall be entitled to, reasonable compensation (which shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust) and the Issuer covenants and agrees to pay or reimburse the Trustee and each predecessor Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by or on behalf of it in accordance with any of the provisions of this Indenture (including the reasonable compensation and the expenses and disbursements of its counsel and of all agents and other persons not regularly in its employ) except any such expense, disbursement or advance as may arise from its negligence or bad faith. The Issuer also covenants to indemnify the Trustee and each predecessor Trustee for, and to hold it harmless against, any loss, liability or expense incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of this Indenture or the trusts hereunder and its duties hereunder, including the costs and expenses of defending itself against or investigating any claim of liability in the premises. The obligations of the Issuer under this Section to compensate and indemnify the Trustee and each predecessor Trustee and to pay or reimburse the Trustee and each predecessor Trustee for expenses, disbursements and advances shall constitute additional indebtedness hereunder and shall survive the satisfaction and discharge of this Indenture. Such additional indebtedness shall be a senior claim to that of the Securities 34 41 upon all property and funds held or collected by the Trustee as such, except funds held in trust for the benefit of the holders of particular Securities, and the Securities are hereby subordinated to such senior claim. SECTION 6.7. RIGHT OF TRUSTEE TO RELY ON OFFICERS' CERTIFICATE, ETC. Subject to Sections 6.1 and 6.2, whenever in the administration of the trusts of this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering or omitting any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of negligence or bad faith on the part of the Trustee, be deemed to be conclusively proved and established by an Officers' Certificate delivered to the Trustee, and such certificate, in the absence of negligence or bad faith on the part of the Trustee, shall be full warrant to the Trustee for any action taken, suffered or omitted by it under the provisions of this Indenture upon the faith thereof. SECTION 6.8. PERSONS ELIGIBLE FOR APPOINTMENT AS TRUSTEE. The Trustee for each series of Securities hereunder shall at all times be a corporation having a combined capital and surplus of at least $50,000,000, and which is eligible in accordance with the provisions of Section 310(a) of the Trust Indenture Act of 1939. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of a Federal, State or District of Columbia supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. For purposes of Section 310(b) of the Trust Indenture Act of 1939, the Trustee shall not be deemed to have a conflicting interest as a result of being Trustee in respect of the Securities of more than one series hereunder or under the Indenture dated as of __________ __, 199_ between the Chubb Capital Corporation, The Chubb Corporation, as guarantor and the Trustee. SECTION 6.9. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR TRUSTEE. (a) The Trustee, or any trustee or trustees hereafter appointed, may at any time resign with respect to one or more or all series of Securities by giving written notice of resignation to the Issuer and by mailing notice thereof by first class mail to Holders of the applicable series of Securities at their last addresses as they shall appear on the Security register. Upon receiving such notice of resignation, the Issuer shall promptly appoint a successor trustee or trustees with respect to the applicable series by written instrument in duplicate, executed by authority of the Board of Directors, one 35 42 copy of which instrument shall be delivered to the resigning Trustee and one copy to the successor trustee or trustees. If no successor trustee shall have been so appointed with respect to any series and have accepted appointment within 30 days after the mailing of such notice of resignation, the resigning trustee may petition any court of competent jurisdiction for the appointment of a successor trustee, or any Securityholder who has been a bona fide Holder of a Security or Securities of the applicable series for at least six months may, subject to the provisions of Section 5.12, on behalf of himself and all others similarly situated, petition any such court for the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, appoint a successor trustee. (b) In case at any time any of the following shall occur: (i) the Trustee shall fail to comply with the provisions of Section 310(b) of the Trust Indenture Act of 1939 with respect to any series of Securities after written request therefor by the Issuer or by any Securityholder who has been a bona fide Holder of a Security or Securities of such series for at least six months; or (ii) the Trustee shall cease to be eligible in accordance with the provisions of Section 310(a) of the Trust Indenture Act of 1939 and shall fail to resign after written request therefor by the Issuer or by any Securityholder; or (iii) the Trustee shall become incapable of acting with respect to any series of Securities, or shall be adjudged a bankrupt or insolvent, or a receiver or liquidator of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation; then, in any such case, the Issuer may remove the Trustee with respect to the applicable series of Securities and appoint a successor trustee for such series by written instrument, in duplicate, executed by order of the Board of Directors of the Issuer, one copy of which instrument shall be delivered to the Trustee so removed and one copy to the successor trustee, or, subject to Section 315(e) of the Trust Indenture Act of 1939, any Securityholder who has been a bona fide Holder of a Security or Securities of such series for at least six months may on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor trustee with respect to such series. 36 43 Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor trustee. (c) The Holders of a majority in aggregate principal amount of the Securities of each series at the time Outstanding may at any time remove the Trustee with respect to Securities of such series and appoint a successor trustee with respect to the Securities of such series by delivering to the Trustee so removed, to the successor trustee so appointed and to the Issuer the evidence provided for in Section 7.1 of the action in that regard taken by the Securityholders. (d) Any resignation or removal of the Trustee with respect to any series and any appointment of a successor trustee with respect to such series pursuant to any of the provisions of this Section 6.9 shall become effective upon acceptance of appointment by the successor trustee as provided in Section 6.10. SECTION 6.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR TRUSTEE. Any successor trustee appointed as provided in Section 6.9 shall execute and deliver to the Issuer and to its predecessor trustee an instrument accepting such appointment hereunder, and thereupon the resignation or removal of the predecessor trustee with respect to all or any applicable series shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all rights, powers, duties and obligations with respect to such series of its predecessor hereunder, with like effect as if originally named as trustee for such series hereunder; but, nevertheless, on the written request of the Issuer or of the successor trustee, upon payment of its charges then unpaid, the trustee ceasing to act shall, subject to Section 10.4, pay over to the successor trustee all moneys at the time held by it hereunder and shall execute and deliver an instrument transferring to such successor trustee all such rights, powers, duties and obligations. Upon request of any such successor trustee, the Issuer shall execute any and all instruments in writing for more fully and certainly vesting in and confirming to such successor trustee all such rights and powers. Any trustee ceasing to act shall, nevertheless, retain a prior claim upon all property or funds held or collected by such trustee to secure any amounts then due it pursuant to the provisions of Section 6.6. If a successor trustee is appointed with respect to the Securities of one or more (but not all) series, the Issuer, the predecessor Trustee and each successor trustee with respect to the Securities of any applicable series shall execute and deliver an indenture supplemental hereto which shall contain such provisions as shall be deemed necessary or desirable to confirm 37 44 that all the rights, powers, trusts and duties of the predecessor Trustee with respect to the Securities of any series as to which the predecessor Trustee is not retiring shall continue to be vested in the predecessor Trustee, and shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such trustees co-trustees of the same trust and that each such trustee shall be trustee of a trust or trusts under separate indentures. No successor trustee with respect to any series of Securities shall accept appointment as provided in this Section 6.10 unless at the time of such acceptance such successor trustee shall be qualified under the provisions of Section 310(b) of the Trust Indenture Act of 1939 and eligible under the provisions of Section 310(a) of the Trust Indenture Act of 1939. Upon acceptance of appointment by any successor trustee as provided in this Section 6.10, the Issuer shall mail notice thereof by first-class mail to the Holders of Securities of any series for which such successor trustee is acting as trustee at their last addresses as they shall appear in the Security register. If the acceptance of appointment is substantially contemporaneous with the resignation, then the notice called for by the preceding sentence may be combined with the notice called for by Section 6.9. If the Issuer fails to mail such notice within ten days after acceptance of appointment by the successor trustee, the successor trustee shall cause such notice to be mailed at the expense of the Issuer. SECTION 6.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS OF TRUSTEE. Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided that such corporation shall be eligible under the provisions of Section 6.8, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding. In case at the time such successor to the Trustee shall succeed to the trusts created by this Indenture any of the Securities of any series shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor Trustee and deliver such Securities so authenticated; and, in case at that 38 45 time any of the Securities of any series shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the name of the successor Trustee; and in all such cases such certificate shall have the full force which it is anywhere in the Securities of such series or in this Indenture provided that the certificate of the Trustee shall have; provided, that the right to adopt the certificate of authentication of any predecessor Trustee or to authenticate Securities of any series in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion or consolidation. ARTICLE 7 CONCERNING THE SECURITYHOLDERS SECTION 7.1. EVIDENCE OF ACTION TAKEN BY SECURITYHOLDERS. Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by a specified percentage in principal amount of the Securityholders of any or all series may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such specified percentage of Securityholders in person or by agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee. Proof of execution of any instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Sections 6.1 and 6.2) conclusive in favor of the Trustee and the Issuer, if made in the manner provided in this Article. SECTION 7.2. PROOF OF EXECUTION OF INSTRUMENTS AND OF HOLDING OF SECURITIES. Subject to Sections 6.1 and 6.2, the execution of any instrument by a Securityholder or his agent or proxy may be proved in accordance with such reasonable rules and regulations as may be prescribed by the Trustee or in such manner as shall be satisfactory to the Trustee. The holding of Securities shall be proved by the Security register or by a certificate of the registrar thereof. The Issuer may set a record date for purposes of determining the identity of holders of Securities of any series entitled to vote or consent to any action referred to in Section 7.1, which record date may be set at any time or from time to time by notice to the Trustee, for any date or dates (in the case of any adjournment or reconsideration) not more than 60 days nor less than five days prior to the proposed date of such vote or consent, and thereafter, notwithstanding any other provisions hereof, only holders of Securities of such series of record on such record 39 46 date shall be entitled to so vote or give such consent or revoke such vote or consent. SECTION 7.3. HOLDERS TO BE TREATED AS OWNERS. The Issuer, the Trustee and any agent of the Issuer or the Trustee may deem and treat the person in whose name any Security shall be registered upon the Security register for such series as the absolute owner of such Security (whether or not such Security shall be overdue and notwithstanding any notation of ownership or other writing thereon) for the purpose of receiving payment of or on account of the principal of and, subject to the provisions of this Indenture, interest on such Security and for all other purposes; and neither the Issuer nor the Trustee nor any agent of the Issuer or the Trustee shall be affected by any notice to the contrary. All such payments so made to any such person, or upon his order, shall be valid, and, to the extent of the sum or sums so paid, effectual to satisfy and discharge the liability for moneys payable upon any such Security. SECTION 7.4. SECURITIES OWNED BY ISSUER DEEMED NOT OUTSTANDING. In determining whether the Holders of the requisite aggregate principal amount of Outstanding Securities of any or all series have concurred in any direction, consent or waiver under this Indenture, Securities which are owned by the Issuer or any other obligor on the Securities with respect to which such determination is being made or by any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer or any other obligor on the Securities with respect to which such determination is being made shall be disregarded and deemed not to be Outstanding for the purpose of any such determination, except that for the purpose of determining whether the Trustee shall be protected in relying on any such direction, consent or waiver only Securities which the Trustee knows are 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 Issuer or any other obligor upon the Securities or any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer or any other obligor on the Securities. In case of a dispute as to such right, the advice of counsel shall be full protection in respect of any decision made by the Trustee in accordance with such advice. Upon request of the Trustee, the Issuer shall furnish to the Trustee promptly an Officers' Certificate listing and identifying all Securities, if any, known by the Issuer to be owned or held by or for the account of any of the above-described persons; and, subject to Sections 6.1 and 6.2, the Trustee shall be entitled to accept such Officers' Certificate as conclusive evidence of the 40 47 facts therein set forth and of the fact that all Securities not listed therein are Outstanding for the purpose of any such determination. SECTION 7.5. RIGHT OF REVOCATION OF ACTION TAKEN. At any time prior to (but not after) the evidencing to the Trustee, as provided in Section 7.1, of the taking of any action by the Holders of the percentage in aggregate principal amount of the Securities of any or all series, as the case may be, specified in this Indenture in connection with such action, any Holder of a Security the serial number of which is shown by the evidence to be included among the serial numbers of the Securities the Holders of which have consented to such action may, by filing written notice at the Corporate Trust Office and upon proof of holding as provided in this Article, revoke such action so far as concerns such Security. Except as aforesaid any such action taken by the Holder of any Security shall be conclusive and binding upon such Holder and upon all future Holders and owners of such Security and of any Securities issued in exchange or substitution therefor, irrespective of whether or not any notation in regard thereto is made upon any such Security. Any action taken by the Holders of the percentage in aggregate principal amount of the Securities of any or all series, as the case may be, specified in this Indenture in connection with such action shall be conclusively binding upon the Issuer, the Trustee and the Holders of all the Securities affected by such action. ARTICLE 8 SUPPLEMENTAL INDENTURES SECTION 8.1. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF SECURITYHOLDERS. The Issuer, when authorized by a resolution of its Board of Directors, and the Trustee may from time to time and at any time enter into an indenture or indentures supplemental hereto for one or more of the following purposes: (a) to convey, transfer, assign, mortgage or pledge to the Trustee as security for the Securities of one or more series any property or assets; (b) to evidence the succession of another corporation to the Issuer, or successive successions, and the assumption by the successor corporation of the covenants, agreements and obligations of the Issuer pursuant to Article Nine; (c) to add to the covenants of the Issuer such further covenants, restrictions, conditions or provisions as its Board of Directors and the Trustee shall consider to be for the protection 41 48 of the Holders of Securities, and to make the occurrence, or the occurrence and continuance, of a default in any such additional covenants, restrictions, conditions or provisions an Event of Default permitting the enforcement of all or any of the several remedies provided in this Indenture as herein set forth; provided, that in respect of any such additional covenant, restriction, condition or provision such supplemental indenture may provide for a particular period of grace after default (which period may be shorter or longer than that allowed in the case of other defaults) or may provide for an immediate enforcement upon such an Event of Default or may limit the remedies available to the Trustee upon such an Event of Default or may limit the right of the Holders of a majority in aggregate principal amount of the Securities of such series to waive such an Event of Default; (d) to cure any ambiguity or to correct or supplement any provision contained herein or in any supplemental indenture which may be defective or inconsistent with any other provision contained herein or in any supplemental indenture; or to make such other provisions in regard to matters or questions arising under this Indenture or under any supplemental indenture as the Board of Directors may deem necessary or desirable and which shall not adversely affect the interests of the Holders of the Securities in any material respect; (e) to establish the forms or terms of Securities of any series as permitted by Sections 2.1 and 2.3; (f) to evidence and provide for the acceptance of appointment hereunder by a successor trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one trustee, pursuant to the requirements of Section 6.10; and (g) to add to or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of Securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons, or to permit or facilitate the issuance of Securities in uncertificated form; or (h) to change or eliminate any of the provisions of this Indenture including, without limitation, any of the provisions set forth in Article Fourteen, provided that any such change or elimination shall become effective only as to Securities of any series created after the execution of such supplemental indenture. 42 49 (i) to make provision with respect to the conversion rights of Holders pursuant to the requirements of Article Thirteen, including providing for the conversion of the Securities into any security (other than the Common Stock of the Issuer) or property of the Issuer. The Trustee is hereby authorized to join with the Issuer in the execution of any such supplemental indenture, to make any further appropriate agreements and stipulations which may be therein contained and to accept the conveyance, transfer, assignment, mortgage or pledge of any property thereunder, but the Trustee shall not be obligated to enter into any such supplemental indenture which affects the Trustee's own rights, duties or immunities under this Indenture or otherwise. Any supplemental indenture authorized by the provisions of this Section may be executed without the consent of the Holders of any of the Securities at the time outstanding, notwithstanding any of the provisions of Section 8.2. SECTION 8.2. SUPPLEMENTAL INDENTURES WITH CONSENT OF SECURITYHOLDERS. With the consent (evidenced as provided in Article Seven) of the Holders of not less than a majority in aggregate principal amount of the Securities at the time Outstanding of all series affected by such supplemental indenture (voting as one class), the Issuer, when authorized by a resolution of its Board of Directors, and the Trustee may, from time to time and at any time, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of any supplemental indenture or of modifying in any manner the rights of the Holders of the Securities of each such series; provided, that no such supplemental indenture shall (a) extend the final maturity of any Security, or reduce the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon, or reduce any amount payable on redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof pursuant to Section 5.1 or the amount thereof provable in bankruptcy pursuant to Section 5.2, or change the currency of payment of principal of or interest on any Security, or extend the time or reduce the amount of any payment to any sinking fund or analogous obligation relating to any Security, or impair or affect the right of any Securityholder to institute suit for the payment thereof or, if the Securities provide therefor, any right of repayment at the option of the Securityholder, or modify the provisions of this Indenture with respect to the subordination of Securities of any series in a manner adverse to the Holders, without the consent of the Holder of each Security so affected, 43 50 or (b) reduce the aforesaid percentage of Securities of any series, the consent of the Holders of which is required for any such supplemental indenture, without the consent of the Holders of each Security so offered, or (c) if applicable, make any change that adversely affects the right to convert any Security to which the provisions of Article Thirteen are applicable or, except as provided in this Indenture, decrease the conversion rate or increase the conversion price of any such Security, without the consent of the Holder of each Security so affected, or (d) reduce to percentage of Securities of any series necessary to consent to waive any past default under this Indenture to less than a majority, without the consent of the Holders of each Security so affected, or (e) modify any of the provisions of this Section 8.2, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Security affected thereby, provided, however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to "the Trustee" and concomitant changes in this Section, or the deletion of this proviso, in accordance with the requirements of Section 6.9, 6.10, 6.11 and 8.2. 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. Upon the request of the Issuer, accompanied by a copy of a resolution of the Board of Directors certified by the Secretary or an Assistant Secretary of the Issuer authorizing the execution of any such supplemental indenture, and upon the filing with the Trustee of evidence of the consent of Securityholders as aforesaid and other documents, if any, required by Section 7.1, the Trustee shall join with the Issuer in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee's own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such supplemental indenture. It shall not be necessary for the consent of the Securityholders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such consent shall approve the substance thereof. 44 51 Promptly after the execution by the Issuer and the Trustee of any supplemental indenture pursuant to the provisions of this Section, the Issuer shall mail a notice thereof by first class mail to the Holders of Securities of each series affected thereby at their addresses as they shall appear on the registry books of the Issuer, setting forth in general terms the substance of such supplemental indenture. Any failure of the Issuer to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture. SECTION 8.3. EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of any supplemental indenture pursuant to the provisions hereof, this Indenture shall be and be deemed to be modified and amended in accordance therewith and the respective rights, limitations of rights, obligations, duties and immunities under this Indenture of the Trustee, the Issuer and the Holders of Securities of each series affected thereby shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes. SECTION 8.4. DOCUMENTS TO BE GIVEN TO TRUSTEE. The Trustee, subject to the provisions of Sections 6.1 and 6.2, may receive an Officers' Certificate and an Opinion of Counsel as conclusive evidence that any supplemental indenture executed pursuant to this Article Eight complies with the applicable provisions of this Indenture. SECTION 8.5. NOTATION ON SECURITIES IN RESPECT OF SUPPLEMENTAL INDENTURES. Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to the provisions of this Article may bear a notation in form approved by the Trustee for such series as to any matter provided for by such supplemental indenture or as to any action taken at any such meeting. If the Issuer or the Trustee shall so determine, new Securities of any series so modified as to conform, in the opinion of the Trustee and the Board of Directors, to any modification of this Indenture contained in any such supplemental indenture may be prepared by the Issuer, authenticated by the Trustee and delivered in exchange for the Securities of such series then outstanding. SECTION 8.6. SUBORDINATION UNIMPAIRED. No provision in any supplemental indenture that affects the superior position of the holders of Senior Indebtedness shall be effective against holders of Senior Indebtedness. 45 52 ARTICLE 9 CONSOLIDATION, MERGER, SALE OR CONVEYANCE SECTION 9.1. ISSUER MAY CONSOLIDATE, ETC., ON CERTAIN TERMS. The Issuer covenants that it will not merge into or consolidate with any other Person, or sell, convey or lease all or substantially all of its assets to any Person, and the Issuer shall not permit any Person to consolidate with or merge into the Issuer or sell, convey or lease all or substantially all of its assets to the Issuer unless (i) either the Issuer shall be the continuing corporation, or the successor Person, or the Person which acquires by sale, conveyance or lease all or substantially all the assets of the Issuer shall be a corporation organized under the laws of the United States of America or any State thereof and shall expressly assume the due and punctual payment of the principal of and interest on all the Securities, according to their tenor, and the due and punctual performance and observance of all of the covenants and conditions of this Indenture to be performed or observed by the Issuer, including without limitation, the conversion rights, if any, shall be provided for in accordance with Article Thirteen, by supplemental indenture satisfactory to the Trustee, executed and delivered to the Trustee by such corporation, and (ii) the Issuer or such successor corporation, as the case may be, shall not, immediately after such merger or consolidation, or such sale, conveyance or lease be in default in the performance of any such covenant or condition. SECTION 9.2. SUCCESSOR CORPORATION SUBSTITUTED. In case of any such consolidation, merger, sale or conveyance, and following such an assumption by the successor corporation, such successor corporation shall succeed to and be substituted for the Issuer, with the same effect as if it had been named herein. Such successor corporation may cause to be signed, and may issue either in its own name or in the name of the Issuer prior to such succession any or all of the Securities issuable hereunder which theretofore shall not have been signed by the Issuer and delivered to the Trustee; and, upon the order of such successor corporation instead of the Issuer and subject to all the terms, conditions and limitations in this Indenture prescribed, the Trustee shall authenticate and shall deliver any Securities which previously shall have been signed and delivered by the officers of the Issuer to the Trustee for authentication, and any Securities which such successor corporation thereafter shall cause to be signed and delivered to the Trustee for that purpose. All of the Securities so issued shall in all respects have the same legal rank and benefit under this Indenture as the Securities theretofore or thereafter issued in accordance with 46 53 the terms of this Indenture as though all of such Securities had been issued at the date of the execution hereof. In case of any such consolidation, merger, sale, lease or conveyance such changes in phraseology and form (but not in substance) may be made in the Securities thereafter to be issued as may be appropriate. In the event of any such sale or conveyance (other than a conveyance by way of lease) and the assumption of the obligations and covenants under the Securities and this Indenture in accordance with Section 9.1 the Issuer shall be discharged from all obligations and covenants under this Indenture and the Securities and the Issuer may be liquidated and dissolved. SECTION 9.3. OPINION OF COUNSEL TO TRUSTEE. The Trustee, subject to the provisions of Sections 6.1 and 6.2, may receive an Opinion of Counsel, prepared in accordance with Section 11.5, as conclusive evidence that any such consolidation, merger, sale, lease or conveyance, and any such assumption, and any such liquidation or dissolution, complies with the applicable provisions of this Indenture. ARTICLE 10 SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS SECTION 10.1. SATISFACTION AND DISCHARGE OF INDENTURE. If at any time (a) the Issuer shall have paid or caused to be paid the principal of and interest on all the Securities of any series outstanding hereunder (other than Securities which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 2.9) as and when the same shall have become due and payable, or (b) the Issuer shall have delivered to the Trustee for cancellation all Securities of any series theretofore authenticated (other than any Securities of such series which shall have been destroyed, lost or stolen and which shall have been replaced or paid as provided in Section 2.9) or (c) (i) all the Securities of such series not theretofore delivered to the Trustee for cancellation shall have become due and payable, or are by their terms to become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption, and (ii) the Issuer shall have irrevocably deposited or caused to be deposited with the Trustee as trust funds the entire amount in cash (other than moneys repaid by the Trustee or any paying agent to the Issuer in accordance with Section 10.4) or direct obligations of the United 47 54 States of America, backed by its full faith and credit ("Government Obligations"), maturing as to principal and interest in such amounts and at such times as will insure the availability of cash sufficient to pay at maturity or upon redemption all Securities of such series (other than any Securities of such series which shall have been destroyed, lost or stolen and which shall have been replaced or paid as provided in Section 2.9) not theretofore delivered to the Trustee for cancellation, including principal and interest due or to become due to such date of maturity as the case may be, and if, in any such case, the Issuer shall also pay or cause to be paid all other sums payable hereunder by the Issuer with respect to Securities of such series, then this Indenture shall cease to be of further effect with respect to Securities of such series (except as to (i) rights of registration of transfer and exchange, and the Issuer's right of optional redemption, (ii) substitution of mutilated, defaced, destroyed, lost or stolen Securities, (iii) rights of holders to receive payments of principal thereof and interest thereon upon the original stated due dates thereof (but not upon acceleration), and remaining rights of the holders to receive mandatory sinking fund payments, if any, (iv) the rights, obligations and immunities of the Trustee hereunder and (v) the rights of the Securityholders of such series as beneficiaries hereof with respect to the property so deposited with the Trustee payable to all or any of them), and the Trustee, on demand of the Issuer accompanied by an Officers' Certificate and an Opinion of Counsel and at the cost and expense of the Issuer, shall execute proper instruments acknowledging such satisfaction of and discharging this Indenture with respect to such series; provided, that the rights of Holders of the Securities to receive amounts in respect of principal of and interest on the Securities held by them shall not be delayed longer than required by then-applicable mandatory rules or policies of any securities exchange upon which the Securities are listed. The Issuer agrees to reimburse the Trustee for any costs or expenses thereafter reasonably and properly incurred and to compensate the Trustee for any services thereafter reasonably and properly rendered by the Trustee in connection with this Indenture or the Securities of such series. SECTION 10.2. APPLICATION BY TRUSTEE OF FUNDS DEPOSITED FOR PAYMENT OF SECURITIES. Subject to Section 10.4, all moneys deposited with the Trustee pursuant to Section 10.1 shall be held in trust and applied by it to the payment, either directly or through any paying agent (including the Issuer acting as its own paying agent), to the Holders of the particular Securities of such series for the payment or redemption of which such moneys have been deposited with the Trustee, of all sums due and to become due thereon for principal and interest; but such money need not be segregated from other funds except to the extent required by law. 48 55 SECTION 10.3. REPAYMENT OF MONEYS HELD BY PAYING AGENT. In connection with the satisfaction and discharge of this Indenture with respect to Securities of any series, all moneys then held by any paying agent under the provisions of this Indenture with respect to such series of Securities shall, upon demand of the Issuer, be repaid to it or paid to the Trustee and thereupon such paying agent shall be released from all further liability with respect to such moneys. SECTION 10.4. RETURN OF MONEYS HELD BY TRUSTEE AND PAYING AGENT UNCLAIMED FOR THREE YEARS. Any moneys or government obligations deposited with or paid to the Trustee or any paying agent for the payment of the principal of or interest on any Security of any series and not applied but remaining unclaimed for three years after the date upon which such principal or interest shall have become due and payable, shall, upon the written request of the Issuer and unless otherwise required by mandatory provisions of applicable escheat or abandoned or unclaimed property law, be repaid to the Issuer by the Trustee for such series or such paying agent, and the Holder of the Security of such series shall, unless otherwise required by mandatory provisions of applicable escheat or abandoned or unclaimed property laws, thereafter look only to the Issuer for any payment which such Holder may be entitled to collect, and all liability of the Trustee or any paying agent with respect to such moneys shall thereupon cease. ARTICLE 11 MISCELLANEOUS PROVISIONS SECTION 11.1. INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS OF ISSUER EXEMPT FROM INDIVIDUAL LIABILITY. No recourse under or upon any obligation, covenant or agreement contained in this Indenture, or in any Security, or because of any indebtedness evidenced thereby, shall be had against any incorporator, as such or against any past, present or future stockholder, officer or director, as such, of the Issuer or of any successor, either directly or through the Issuer or any successor, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of the Securities by the holders thereof and as part of the consideration for the issue of the Securities. SECTION 11.2. PROVISIONS OF INDENTURE FOR THE SOLE BENEFIT OF PARTIES AND SECURITYHOLDERS. Nothing in this Indenture or in the Securities, expressed or implied, shall give 49 56 or be construed to give to any person, firm or corporation, other than the parties hereto and their successors and the Holders of the Securities, any legal or equitable right, remedy or claim under this Indenture or under any covenant or provision herein contained, all such covenants and provisions being for the sole benefit of the parties hereto and their successors and of the Holders of the Securities. SECTION 11.3. SUCCESSORS AND ASSIGNS OF ISSUER BOUND BY INDENTURE. All the covenants, stipulations, promises and agreements in this Indenture contained by or in behalf of the Issuer shall bind its successors and assigns, whether so expressed or not. SECTION 11.4. NOTICES AND DEMANDS ON ISSUER, TRUSTEE AND SECURITYHOLDERS. Any notice or demand which by any provision of this Indenture is required or permitted to be given or served by the Trustee or by the Holders of Securities to or on the Issuer may be given or served by being deposited postage prepaid, first-class mail (except as otherwise specifically provided herein) addressed (until another address of the Issuer is filed by the Issuer with the Trustee) to The Chubb Corporation, 15 Mountain View Road, P.O. Box 1615, Warren, NJ 07061-1615, Attn: Treasurer. Any notice, direction, request or demand by the Issuer or any Securityholder to or upon the Trustee shall be deemed to have been sufficiently given or made, for all purposes, if given or made at The First National Bank of Chicago, One First National Plaza, Chicago, IL 60670-0126, Attention: Corporate Trust Services Division. Where this Indenture provides for notice to Holders, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to each Holder entitled thereto, at the last address of the Securityholder as it appears in the Security register. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders. Where this Indenture provides for notice in any manner, such notice may be waived in writing by the person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. In case, by reason of the suspension of or irregularities in regular mail service, it shall be impracticable to mail notice to the Issuer and Securityholders when such notice 50 57 is required to be given pursuant to any provision of this Indenture, then any manner of giving such notice as shall be satisfactory to the Trustee shall be deemed to be a sufficient giving of such notice. SECTION 11.5. OFFICERS' CERTIFICATES AND OPINIONS OF COUNSEL; STATEMENTS TO BE CONTAINED THEREIN. Upon any application or demand by the Issuer to the Trustee to take any action under any of the provisions of this Indenture, the Issuer shall furnish to the Trustee an Officers' Certificate stating that all conditions precedent provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent have been complied with, except that in the case of any such application or demand as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or demand, no additional certificate or opinion need be furnished. Each certificate or opinion provided for in this Indenture and delivered to the Trustee with respect to compliance with a condition or covenant provided for in this Indenture shall include (a) a statement that the person making such certificate or opinion has read such covenant or condition, (b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based, (c) a statement that, in the opinion of such person, he or she has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with and (d) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with. Any certificate, statement or opinion of an officer of the Issuer may be based, insofar as it relates to legal matters, upon a certificate or opinion of or representations by counsel, unless such officer knows that the certificate or opinion or representations with respect to the matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any certificate, statement or opinion of counsel may be based, insofar as it relates to factual matters, information with respect to which is in the possession of the Issuer, upon the certificate, statement or opinion of or representations by an officer or officers of the Issuer, unless such counsel knows that the certificate, statement or opinion or representations with respect to the matters upon which his certificate, statement or opinion may be based as aforesaid are 51 58 erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any certificate, statement or opinion of an officer of the Issuer or of counsel may be based, insofar as it relates to accounting matters, upon a certificate or opinion of or representations by an accountant or firm of accountants in the employ of the Issuer, unless such officer or counsel, as the case may be, knows that the certificate or opinion or representations with respect to the accounting matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any certificate or opinion of any independent firm of public accountants filed with the Trustee shall contain a statement that such firm is independent. SECTION 11.6. PAYMENTS DUE ON SATURDAYS, SUNDAYS AND HOLIDAYS. If the date of maturity of interest on or principal of the Securities of any series or the date fixed for redemption or repayment of any such Security or the last day on which a Holder has the right to convert a Security at a particular conversion price shall not be a Business Day, then payment of interest or principal, or any conversion need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on the date of maturity or the date fixed for redemption, and no interest shall accrue for the period after such date. SECTION 11.7. CONFLICT OF ANY PROVISION OF INDENTURE WITH TRUST INDENTURE ACT OF 1939. If and to the extent that any provision of this Indenture limits, qualifies or conflicts with another provision included in this Indenture by operation of Sections 310 to 318, inclusive, of the Trust Indenture Act of 1939 (an "incorporated" provision), such incorporated provision shall control. SECTION 11.8. NEW YORK LAW TO GOVERN. This Indenture and each Security shall be deemed to be a contract under the laws of the State of New York, and for all purposes shall be construed in accordance with the laws of such State. SECTION 11.9. COUNTERPARTS. This Indenture may be executed in any number of counterparts, each of which shall be an original; but such counterparts shall together constitute but one and the same instrument. 52 59 SECTION 11.10. EFFECT OF HEADINGS. The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. ARTICLE 12 REDEMPTION OF SECURITIES AND SINKING FUNDS SECTION 12.1. APPLICABILITY OF ARTICLE. The provisions of this Article shall be applicable to the Securities of any series which are redeemable before their maturity or to any sinking fund for the retirement of Securities of a series except as otherwise specified as contemplated by Section 2.3 for Securities of such series. SECTION 12.2. NOTICE OF REDEMPTION; PARTIAL REDEMPTIONS. Notice of redemption to the Holders of Securities of any series to be redeemed as a whole or in part at the option of the Issuer shall be given by mailing notice of such redemption by first class mail, postage prepaid, at least 30 days and not more than 60 days prior to the date fixed for redemption to such Holders of Securities of such series at their last addresses as they shall appear upon the registry books. Any notice which is mailed in the manner herein provided shall be conclusively presumed to have been duly given, whether or not the Holder receives the notice. Failure to give notice by mail, or any defect in the notice to the Holder of any Security of a series designated for redemption as a whole or in part shall not affect the validity of the proceedings for the redemption of any other Security of such series. The notice of redemption to each such Holder shall specify (i) the principal amount of each Security of such series held by such Holder to be redeemed, (ii) the date fixed for redemption, (iii) the redemption price, (iv) the place or places of payment, (v) that payment will be made upon presentation and surrender of such Securities, (vi) that such redemption is pursuant to the mandatory or optional sinking fund, or both, if such be the case, (vii) that interest accrued to the date fixed for redemption will be paid as specified in such notice and that on and after said date interest thereon or on the portions thereof to be redeemed will cease to accrue and (viii) if applicable, the conversion price, and that the date on which the right to convert the principal of the Securities or the portions thereof to be redeemed will terminate will be the date fixed for redemption and the place or places where such Securities may be surrendered for conversion. In case any Security of a series is to be redeemed in part only the notice of redemption shall state the portion of the principal amount thereof to be redeemed and 53 60 shall state that on and after the date fixed for redemption, upon surrender of such Security, a new Security or Securities of such series in any authorized denomination and in principal amount equal to the unredeemed portion thereof will be issued. The notice of redemption of Securities of any series to be redeemed at the option of the Issuer shall be given by the Issuer or, at the Issuer's request, by the Trustee in the name and at the expense of the Issuer. At least one Business Day prior to the redemption date specified in the notice of redemption given as provided in this Section, the Issuer will deposit with the Trustee or with one or more paying agents (or, if the Issuer is acting as its own paying agent, set aside, segregate and hold in trust as provided in Section 3.4) an amount of money sufficient to redeem on the redemption date all the Securities of such series so called for redemption at the appropriate redemption price, together with accrued interest to the date fixed for redemption, other than any Securities called for redemption on that date which have been converted prior to the date of such deposit. If less than all the outstanding Securities of a series are to be redeemed, the Issuer will deliver to the Trustee at least 70 days prior to the date fixed for redemption an Officers' Certificate stating the aggregate principal amount of Securities to be redeemed. If any Security or portion thereof called for redemption is converted, any money deposited with the Trustee or with any paying agent or so segregated and held in trust for the redemption of such Security or portion thereof shall (subject to any right of the Holder of such Security or any predecessor Security to receive interest as provided in the last paragraph of Section 2.7) be paid to the Issuer upon Issuer request or, if then held by the Issuer, shall be discharged from such trust. If less than all the Securities of a series are to be redeemed, the Trustee shall select, in the manner specified in such Securities or specified pursuant to Section 2.3, or, if no manner is specified in the Securities or pursuant to Section 2.3, then in such manner as it shall deem appropriate and fair, Securities of such Series to be redeemed in whole or in part. Securities may be redeemed in part in an amount equal to any authorized denomination for Securities of such series. If any Security selected for partial redemption is converted in part before termination of the conversion right with respect to the portion of the Security so selected, the converted portion of such Security shall be deemed (so far as may be) to be the portion selected for redemption. Securities which have been converted during a selection of Securities to be redeemed shall 54 61 be treated by the Trustee as Outstanding for the purpose of such selection. The Trustee shall promptly notify the Issuer in writing of the Securities of such series selected for redemption and, in the case of any Securities of such series selected for partial redemption, the principal amount thereof to be redeemed. For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities of any series shall relate, in the case of any Security redeemed or to be redeemed only in part, to the portion of the principal amount of such Security which has been or is to be redeemed. SECTION 12.3. PAYMENT OF SECURITIES CALLED FOR REDEMPTION. If notice of redemption has been given as above provided, the Securities or portions of Securities specified in such notice shall become due and payable on the date and at the place stated in such notice at the applicable redemption price, together with interest accrued to the date fixed for redemption, and on and after said date (unless the Issuer shall default in the payment of such Securities at the redemption price, together with interest accrued to said date) interest on the Securities or portions of Securities so called for redemption shall cease to accrue and, except as provided in Sections 6.5 and 10.4, such Securities shall cease from and after the date fixed for redemption to be entitled to any benefit or security under this Indenture, and the Holders thereof shall have no right in respect of such Securities except the right to receive the redemption price thereof and unpaid interest to the date fixed for redemption. On presentation and surrender of such Securities at a place of payment specified in said notice, said Securities or the specified portions thereof shall be paid and redeemed by the Issuer at the applicable redemption price, together with interest accrued thereon to the date fixed for redemption; provided that any installment of interest becoming due on or prior to the date fixed for redemption shall be payable to the Holders of such Securities registered as such on the relevant record date subject to the terms and provisions of Section 2.4 hereof. If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal shall, until paid or duly provided for, bear interest from the date fixed for redemption at the rate of interest or Yield to Maturity (in the case of an Original Issue Discount Security) borne by the Security. Upon presentation of any Security redeemed in part only, the Issuer shall execute and the Trustee shall authenticate and deliver to or on the order of the Holder thereof, at the expense of the Issuer, a new Security or Securities of such 55 62 series, of authorized denominations, in principal amount equal to the unredeemed portion of the Security so presented. SECTION 12.4. EXCLUSION OF CERTAIN SECURITIES FROM ELIGIBILITY FOR SELECTION FOR REDEMPTION. If this Section has been specified in accordance with Section 2.3 to be applicable to the Securities of any series, then Securities or such series shall be excluded from eligibility for selection for redemption if they are identified by registration and certificate number in a written statement signed by an authorized officer of the Issuer and delivered to the Trustee at least 40 days prior to the last date on which notice of redemption may be given as being owned of record and beneficially by, and not pledged or hypothecated by either (a) the Issuer or (b) an entity specifically identified in such written statement directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer. SECTION 12.5. MANDATORY AND OPTIONAL SINKING FUNDS. 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". The date on which a sinking fund payment is to be made is herein referred to as the "sinking fund payment date". If this paragraph has been specified in accordance with Section 2.3 to be applicable to the Securities of any series, then in lieu of making all or any part of any mandatory sinking fund payment with respect to any series of Securities in cash, the Issuer may at its option (a) deliver to the Trustee Securities of such series theretofore purchased or otherwise acquired (except upon redemption pursuant to the mandatory sinking fund) by the Issuer or receive credit for Securities of such series (not previously so credited) theretofore purchased or otherwise acquired (except as aforesaid) by the Issuer and delivered to the Trustee for cancellation pursuant to Section 2.7, (b) receive credit for Securities of a series which have been converted pursuant to Article Thirteen, (c) receive credit for optional sinking fund payments (not previously so credited) made pursuant to this Section, or (d) receive credit for Securities of such series (not previously so credited) redeemed by the Issuer through any optional redemption provision contained in the terms of such series. Securities so delivered or credited shall be received or credited by the Trustee at the sinking fund redemption price specified in such Securities. Unless this paragraph has been specified in accordance with Section 2.3 to be inapplicable to the Securities of any 56 63 series, an amount equal to 20% of the aggregate principal amount of Securities of any series that have been repurchased by the Issuer and canceled by the Trustee or delivered to the Trustee for cancellation shall be credited (without crediting any portion of such Securities more than once with respect to any particular sinking fund payment) against, and shall thereby reduce, the aggregate amount of the next succeeding and each subsequent sinking fund payment required to be made with respect to Securities of such series. On or before the sixtieth day next preceding each sinking fund payment date for any series, the Issuer will deliver to the Trustee a written statement (which need not contain the statements required by Section 11.5) signed by an authorized officer of the Issuer (a) specifying the portion of the mandatory sinking fund payment to be satisfied by payment of cash and the portion to be satisfied by credit of Securities of such series, (b) stating that none of such Securities of such series has theretofore been so credited, (c) stating that no defaults in the payment of interest or Events of Default with respect to such series have occurred (which have not been waived or cured) and are continuing and (d) stating whether or not the Issuer intends to exercise its right to make an optional sinking fund payment with respect to such series and, if so, specifying the amount of such optional sinking fund payment which the Issuer intends to pay on or before the next succeeding sinking fund payment date. Any Securities of such series to be credited and required to be delivered to the Trustee in order for the Issuer to be entitled to credit therefor as aforesaid which have not theretofore been delivered to the Trustee shall be delivered for cancellation pursuant to Section 2.10 to the Trustee with such written statement (or reasonably promptly thereafter if acceptable to the Trustee). Such written statement shall be irrevocable and upon its receipt by the Trustee the Issuer shall become unconditionally obligated to make all the cash payments therein referred to, if any, on or before the next succeeding sinking fund payment date. Failure of the Issuer, on or before any such sixtieth day, to deliver such written statement and Securities specified in this paragraph, if any, shall not constitute a default but shall constitute, on and as of such date, the irrevocable election of the Issuer (i) that the mandatory sinking fund payment for such series due on the next succeeding sinking fund payment date shall be paid entirely in cash without the option to deliver or credit Securities of such series in respect thereof and (ii) that the Issuer will make no optional sinking fund payment with respect to such series as provided in this Section. If the sinking fund payment or payments (mandatory or optional or both) to be made in cash on the next succeeding 57 64 sinking fund payment date plus any unused balance of any preceding sinking fund payments made in cash shall exceed $50,000 (or a lesser sum if the Issuer shall so request) with respect to the Securities of any particular series, such cash shall be applied on the next succeeding sinking fund payment date to the redemption of Securities of such series at the sinking fund redemption price together with accrued interest to the date fixed for redemption. If such amount shall be $50,000 or less and the Issuer makes no such request then it shall be carried over until a sum in excess of $50,000 is available. The Trustee shall select, in the manner provided in Section 12.2, for redemption on such sinking fund payment date a sufficient principal amount of Securities of such series to absorb said cash, as nearly as may be, shall (if requested in writing by the Issuer) inform the Issuer of the serial numbers of the Securities of such series (or portions thereof) so selected. Securities of any series which are (a) owned by the Issuer or an entity known by the Trustee to be directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer, as shown by the Security register, and not known to the Trustee to have been pledged or hypothecated by the Issuer or any such entity or (b) identified in an Officers' Certificate at least 60 days prior to the sinking fund payment date as being beneficially owned by, and not pledged or hypothecated by, the Issuer or an entity directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer shall be excluded from Securities of such series eligible for selection for redemption. The Trustee, in the name and at the expense of the Issuer (or the Issuer, if it shall so request the Trustee in writing) shall cause notice of redemption of the Securities of such series to be given in substantially the manner provided in Section 12.2 (and with the effect provided in Section 12.3) for the redemption of Securities of such series in part at the option of the Issuer. The amount of any sinking fund payments not so applied or allocated to the redemption of Securities of such series shall be added to the next cash sinking fund payment for such series and, together with such payment, shall be applied in accordance with the provisions of this Section. Any and all sinking fund moneys held on the stated maturity date of the Securities of any particular series (or earlier, if such maturity is accelerated), which are not held for the payment or redemption of particular Securities of such series shall be applied, together with other moneys, if necessary, sufficient for the purpose, to the payment of the principal of, and interest on, the Securities of such series at maturity. At least one Business Day before each sinking fund payment date, the Issuer shall pay to the Trustee in cash or shall otherwise provide for the payment of all interest accrued 58 65 to the date fixed for redemption on Securities to be redeemed on the next following sinking fund payment date. The Trustee shall not redeem or cause to be redeemed any Securities of a series with sinking fund moneys or mail any notice of redemption of Securities for such series by operation of the sinking fund during the continuance of a default in payment of interest on such Securities or of any Event of Default except that, where the mailing of notice of redemption of any Securities shall theretofore have been made, the Trustee shall redeem or cause to be redeemed such Securities, provided that it shall have received from the Issuer a sum sufficient for such redemption. Except as aforesaid, any moneys in the sinking fund for such series at the time when any such default or Event of Default shall occur, and any moneys thereafter paid into the sinking fund, shall, during the continuance of such default or Event of Default, be deemed to have been collected under Article Five and held for the payment of all such Securities. In case such Event of Default shall have been waived as provided in Section 5.10 or the default cured on or before the sixtieth day preceding the sinking fund payment date in any year, such moneys shall thereafter be applied on the next succeeding sinking fund payment date in accordance with this Section to the redemption of such Securities. ARTICLE 13 CONVERSION OF SECURITIES SECTION 13.1. APPLICABILITY OF ARTICLE. The provisions of this Article shall be applicable to the Securities of any series which are convertible into shares of Common Stock of the Issuer, and the issuance of such shares of Common Stock upon the conversion of such Securities, except as otherwise specified as contemplated by Section 2.3 for the Securities of such series. SECTION 13.2. EXERCISE OF CONVERSION PRIVILEGE. In order to exercise a conversion privilege, the Holder of a Security of a series with such a privilege shall surrender such Security to the Issuer at the office or agency maintained for that purpose, accompanied by written notice, in the form set forth in or prescribed by such Security, to the Issuer that the Holder elects to convert such Security or a specified portion thereof. Such notice shall also state, if different from the name and address of such Holder, the name or names (with address)in which the certificate or certificates for shares of Common Stock which shall be issuable on such conversion shall be issued. Securities surrendered for conversion shall (if so 59 66 required by the Issuer or the Trustee) be duly endorsed by or accompanied by instruments of transfer in forms satisfactory to the Issuer and the Trustee duly executed by the registered Holder or its attorney duly authorized in writing; and Securities so surrendered for conversion during the period from the close of business on any record date to the opening of business on the next succeeding interest payment date (excluding Securities or portions thereof called for redemption during such period) shall also be accompanied by payment in funds acceptable to the Issuer of an amount equal to the interest payable on such interest payment date on the principal amount of such Security then being converted, and such interest shall be payable to such registered Holder notwithstanding the conversion of such Security, subject to the provisions of Section 2.7 relating to the payment of defaulted interest by the Issuer. As promptly as practicable after the receipt of such notice and of any payment required pursuant to a Board Resolution and, subject to Section 2.4, set forth, or determined in the manner provided, in an Officers' Certificate, or established in one or more indentures supplemental hereto setting forth the terms of such series of Security, and the surrender of such Security in accordance with such reasonable regulations as the Issuer may prescribe, the Issuer shall issue and shall deliver, at the office or agency at which such Security is surrendered, to such Holder or on its written order, a certificate or certificates for the number of full shares of Common Stock issuable upon the conversion of such Security (or specified portion thereof), in accordance with the provisions of such Board Resolution, Officers' Certificate or supplemental indenture, and cash as provided therein in respect of any fractional share of such Common Stock otherwise issuable upon such conversion. Such conversion shall be deemed to have been effected immediately prior to the close of business on the date on which such notice and such payment, if required, shall have been received in proper order for conversion by the Issuer and such Security shall have been surrendered as aforesaid (unless such Holder shall have so surrendered such Security and shall have instructed the Issuer to effect the conversion on a particular date following such surrender and such Holder shall be entitled to convert such Security on such date, in which case such conversion shall be deemed to be effected immediately prior to the close of business on such date) and at such time the rights of the Holder of such Security as such Security Holder shall cease and the person or persons in whose name or names any certificate or certificates for shares of Common Stock of the Issuer shall be issuable upon such conversion shall be deemed to have become the Holder or Holders of record of the shares represented thereby. Except as set forth above and subject to the final paragraph of Section 2.7, no payment or adjustment shall be made upon any conversion on account of any interest accrued on the Securities surrendered for conversion or on 60 67 account of any dividends on the Common Stock of the Issuer issued upon such conversion. In the case of any Security which is converted in part only, upon such conversion the Issuer shall execute and the Trustee shall authenticate and deliver to or on the order of the Holder thereof, at the expense of the Issuer, a new Security or Securities of the same series, of authorized denominations, in aggregate principal amount equal to the unconverted portion of such Security. SECTION 13.3. NO FRACTIONAL SHARES. No fractional share of Common Stock of the Issuer shall be issued upon conversions of Securities of any series. If more than one Security shall be surrendered for conversion at one time by the same Holder, the number of full shares which shall be issuable upon conversion shall be computed by the Issuer on the basis of the aggregate principal amount of the Securities (or specified portions thereof to the extent permitted hereby) so surrendered. If, except for the provisions of this Section 13.3, any Holder of a Security or Securities would be entitled to a fractional share of Common Stock of the Issuer upon the conversion of such Security or Securities, or specified portions thereof, the Issuer shall pay to such Holder an amount in cash equal to the current market value of such fractional share computed, (i) if such Common Stock is listed or admitted to unlisted trading privileges on a national securities exchange, on the basis of the last reported sale price regular way on such exchange on the last trading day prior to the date of conversion upon which such a sale shall have been effected, or (ii) if such Common Stock is not at the time so listed or admitted to unlisted trading privileges on a national securities exchange, on the basis of the average of the bid and asked prices of such Common Stock in the over-the-counter market, on the last trading day prior to the date of conversion, as reported by the National Association of Securities Dealers Automated Quotation System, or if not so available, the fair market price as determined by the Board of Directors. For purposes of this Section, "trading day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday other than any day on which the Common Stock is not traded on the New York Stock Exchange, or if the Common Stock is not traded on the New York Stock Exchange, on the principal exchange or market on which the Common Stock is traded or quoted. The Trustee shall not have any responsibility with respect to the computation of the Conversion Price, and may conclusively rely upon the Issuer's determination thereof. SECTION 13.4. ADJUSTMENT OF CONVERSION PRICE. The Conversion Price in effect at any time shall be subject to adjustment as follows: 61 68 (a) In case the Issuer shall (i) pay a dividend in or make a distribution of shares of its capital stock (whether shares of Common Stock or of capital stock of any other class), (ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares or (iv) issue by reclassification of its shares of Common Stock any shares of capital stock of the Issuer, the conversion price in effect immediately prior to such action shall be adjusted by the Issuer so that the holder of any Security thereafter surrendered for conversion shall be entitled to receive the number of shares of capital stock of the Issuer which he would have owned or been entitled to receive immediately following such action had such Security been exchanged immediately prior thereto. An adjustment made pursuant to this paragraph (a) shall become effective retroactively immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification. If, as a result of an adjustment made pursuant to this paragraph (a), the holder of any Security thereafter surrendered for conversion shall become entitled to receive shares of two or more classes of capital stock of the Issuer, the Board of Directors (whose determination shall be conclusive) shall determine the allocation of the adjusted exchange price between or among shares of such classes of capital stock. (b) In case the Issuer shall issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 45 days after the record date mentioned below) to subscribe for or purchase shares of Common Stock at a price per share less than the then current market price per share (as determined pursuant to paragraph (d) below) on the record date mentioned below, the conversion price of the Common Stock shall be adjusted so that the same shall equal the price determined by multiplying the conversion price in effect immediately prior to the date of issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock outstanding on the date of issuance of such rights or warrants plus the number of shares of Common Stock which the aggregate offering price of the total number of shares of Common Stock so offered would purchase at such current market price and of which the denominator shall be the number of shares of Common Stock outstanding on the date of issuance of such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase. Such adjustment shall become effective retroactively immediately after the record date for the determination of stockholders entitled to receive such rights or warrants. 62 69 (c) In case the Issuer shall distribute to all holders of its Common Stock evidences of its indebtedness or assets (excluding any cash dividend paid from retained earnings of the Issuer) or rights or warrants to subscribe to securities of the Issuer (excluding those referred to in Paragraph (b) above), then in each such case the conversion price shall be adjusted so that the same shall equal the price determined by multiplying the conversion price in effect immediately prior to the date of such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (d) below) of Common Stock less the then fair market value (as determined by the Board of Directors of the Issuer, whose determination shall be conclusive) of the portion of the assets or evidences of indebtedness so distributed or of such subscription rights or warrants applicable to one share of Common Stock, and of which the denominator shall be such current market price per share of the Common Stock on the record date mentioned below. Such adjustment shall become effective retroactively immediately after the record date for the determination of stockholders entitled to receive such distribution. (d) For the purpose of any computation under paragraphs (b) and (c) above, the current market price per share of Common Stock on any date shall be deemed to be the average of the daily closing prices for 10 consecutive Business Days commencing 10 Business Days before the day in question. The closing price for each day shall be the last reported sales price regular way on the New York Stock Exchange ("NYSE"), or, if not reported for the NYSE, on the Composite Tape, or, in case no such reported sale takes place on such day, the average of the reported closing bid and asked quotations on the NYSE, or, if the Common Stock is not listed on the NYSE or no such quotations are available, the average of the high bid and low asked quotations in the over-the-counter market as reported by the National Quotation Bureau, Incorporated, or similar organization, or, if no such quotations are available, the fair market price as determined by the Issuer (whose determination shall be conclusive). (e) In any case in which this Section 13.4 shall require that an adjustment be made retroactively immediately following a record date, the Issuer may elect to defer (but only until five Business Days following the mailing by the Issuer of the Officer's Certificate described in paragraph (j) below) issuing to the holder of any share converted after such record date (i) the shares of Common Stock and other capital stock of the Issuer issuable upon such conversion over and above (ii) the shares of Common Stock and other capital stock of the Issuer issuable upon such conversion only on the basis of the conversion price prior to adjustment. 63 70 (f) In the case of either (i) any consolidation or merger to which the Issuer is a party, other than a consolidation or a merger in which the Issuer is a continuing corporation and which does not result in any reclassification of, or change (other than a change in par value or from par value to no par value or from no par value to par value, or as a result of a subdivision or combination) in, outstanding shares of the Common Stock, or (ii) any sale or conveyance to another corporation of the property of the Issuer as an entirety or substantially as an entirety, then the holder of each Outstanding Security shall have the right to exchange such Security into the kind and amount of shares of stock and other securities and property (including cash) receivable upon such consolidation, merger, sale or conveyance by a holder of the number of shares of Common Stock issuable upon conversion of such Security immediately prior to such consolidation, merger, sale or conveyance, subject to adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 13.4 assuming, in the case of any consolidation, merger, sale or conveyance, such holder of Common Stock of the Issuer (i) is not a Person with or into which the Issuer consolidated or merged or which merged into the Issuer or to which such sale or conveyance was made, as the case may be ("constituent Person"), or an Affiliate of a constituent Person and (ii) failed to exercise his rights of election, if any, as to the kind or amount of shares of stock and other securities and property (including cash) receivable upon such consolidation, merger, sale or conveyance (provided that if the kind or amount of shares of stock and other securities and property (including cash) receivable upon such consolidation, merger, sale or conveyance is not the same for each share of Common Stock of the Issuer held immediately prior to such consolidation, merger, sale or conveyance by others than a constituent Person or an Affiliate thereof and in respect of which such rights of election shall not have been exercised ("non-electing share"), then for the purpose of this Section 13.4 the kind and amount of shares of stock and other securities and property (including cash) receivable upon such consolidation, merger, sale or conveyance by each non-electing share shall be deemed to be the kind and amount so receivable per share by a plurality of the non-electing shares). The provisions of this paragraph (f) shall similarly apply to successive consolidations, mergers, sales or conveyances. (g) No adjustment in the conversion price shall be required unless such adjustment would require an increase or decrease of at least 1% in such price; provided, however, that any adjustments which by reason of this paragraph (g) are not required to be made shall be carried forward and taken into account in any subsequent adjustment; and, provided further that adjustment shall be required and made in accordance with the 64 71 provisions of this Section 13.4 (other than this paragraph (g)) not later than such time as may be required in order to preserve the tax-free nature of a distribution to the holders of shares of Common Stock. All calculations under this Section 13.4 shall be made to the nearest cent or to the nearest one-hundredth of a share, as the case may be. Anything in this Section 13.4 to the contrary notwithstanding, the Issuer shall be permitted to make such reductions in the conversion price in addition to those required by this Section 13.4 as it in its discretion shall consider to be advisable in order that any stock dividends, subdivision of shares, distribution of rights to purchase stock or securities, or distribution of securities convertible into or exchangeable for stock hereafter made by the Issuer to its stockholders shall not be taxable to the holders of the Common Stock. (h) In the event that at any time as a result of an adjustment made pursuant to paragraph (a) above, the holder of any Security thereafter surrendered for conversion shall become entitled to receive any shares of the Issuer other than shares of its Common Stock, thereafter the conversion price of such other shares so receivable upon conversion of any Security shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to Common Stock contained in paragraphs (a) through (g) above, and the provisions of Sections 13.1 through 13.3 and Sections 13.5 through 13.9 with respect to the Common Stock shall apply on like or similar terms to any such other shares. (i) Before taking any action which would cause an adjustment reducing the then equivalent conversion price to be below the then par value of the Common Stock, the Issuer will take any corporate action which may, in the opinion of its counsel, be necessary in order that the Issuer may validly and legally issue fully paid and non-assessable shares of Common Stock at the conversion price as so adjusted. (j) Whenever the Conversion Price is adjusted as herein provided, the Company shall promptly (i) file with the Trustee and each additional conversion agent, if any, an Officer's Certificate setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment, which certificate shall be conclusive evidence of the correctness of such adjustment, and (ii) mail or cause to be mailed a notice of such adjustment to each Holder of Securities at his address as the same appears on the registry books of the Company. Neither the Trustee nor any conversion agent shall be under any responsibility to determine the correctness of any adjustment to the Conversion Price to be made pursuant to this Section. 65 72 SECTION 13.5. NOTICE OF CERTAIN CORPORATE ACTIONS. In case: (a) the Issuer shall declare a dividend (or any other distribution) on its Common Stock (other than dividends or distributions which will not require an adjustment of the conversion price of Securities of any series pursuant to Section 13.4); or (b) the Issuer shall authorize the granting to the holders of its Common Stock of rights, options or warrants to subscribe for or purchase any shares of capital stock of any class or of any other rights (other than any such grant for which approval of any shareholders of the Issuer is required or which will not require an adjustment of the conversion price of Securities of any series pursuant to Section 13.4); or (c) of any reclassification of the Common Stock of the Issuer (other than a subdivision or combination of its outstanding shares of Common Stock, or any consolidation, merger or share exchange to which the Issuer is a party and for which approval of any shareholders of the Issuer is required or which will not require an adjustment of the conversion price of Securities of any series pursuant to Section 13.4), or of the sale of all or substantially all of the assets of the Issuer; or (d) of the voluntary or involuntary dissolution, liquidation or winding up of the Issuer; then the Issuer shall cause to be filed with the Trustee, and shall cause to be mailed to all Holders at their last addresses as they shall appear in the Securities Register, at least 20 days (or 10 days in any case specified in clause (a) or (b) above) prior to the applicable record date hereinafter specified, a notice stating (i) the date on which a record is to be taken for the purpose of such dividend, distribution, rights, options or warrants, or, if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such dividend, distribution, rights, options or warrants are to be determined, or (ii) the date on which such reclassification, consolidation, merger, share exchange, sale, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their shares of Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, share exchange, sale, dissolution, liquidation or winding up. If at any time the Trustee shall not be the conversion agent, a copy of such notice 66 73 shall also forthwith be filed by the Issuer with the conversion agent. SECTION 13.6. RESERVATION OF SHARES OF COMMON STOCK. The Issuer shall at all times reserve and keep available, free from preemptive rights, out of its authorized but unissued Common Stock, for the purpose of effecting the conversion of Securities, the full number of shares of Common Stock of the Issuer then issuable upon the conversion of all outstanding Securities of any series that have conversion rights. SECTION 13.7. PAYMENT OF CERTAIN TAXES UPON CONVERSION. The Issuer will pay any and all taxes that may be payable in respect of the issue or delivery of shares of its Common Stock on conversion of Securities pursuant hereto. The Issuer shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of shares of its Common Stock in a name other than that of the Holder of the Security or Securities to be converted, and no such issue or delivery shall be made unless and until the person requesting such issue has paid to the Issuer the amount of any such tax, or has established, to the satisfaction of the Issuer, that such tax has been paid. SECTION 13.8. NONASSESSABILITY. The Issuer covenants that all shares of its Common Stock which may be issued upon conversion of Securities will upon issue in accordance with the terms hereof be duly and validly issued and fully paid and nonassessable. SECTION 13.9. EFFECT OF CONSOLIDATION OR MERGER ON CONVERSION PRIVILEGE. In case of any consolidation of the Issuer with, or merger of the Issuer into or with any other Person, or in the case of a statutory share exchange to which the Issuer is a party or in case of any sale or conveyance of all or substantially all of the properties or assets of the Issuer (including cash), the Issuer or the Person formed by such consolidation or the Person into which the Issuer shall have been merged or the Person which shall have acquired such assets, or the surviving entity in such share exchange, as the case may be, shall execute and deliver to the Trustee a supplemental indenture providing that the Holder of each Security then outstanding of any series that is convertible into Common Stock of the Issuer shall have the right, which right shall be the exclusive conversion right thereafter available to said Holder (until the expiration of the conversion right of such Security), to convert such Security into the kind and amount of shares of stock or other securities or property (including cash) receivable upon such consolidation, merger, share exchange, conveyance or sale by a holder of the number of shares of Common Stock of the Issuer 67 74 into which such Security might have been converted immediately prior to such consolidation, merger, share exchange, conveyance or sale, subject to compliance with the other provisions of this Indenture, such Security and such supplemental indenture. Such supplemental indenture shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in such Security. The above provisions of this Section shall similarly apply to successive consolidation, mergers, share exchanges, conveyances or sales. It is expressly agreed and understood that anything in this Indenture to the contrary notwithstanding, if pursuant to such merger, consolidation, share exchange, conveyance or sale, holders of outstanding shares of Common Stock of the Issuer do not receive shares of common stock of the surviving corporation but receive other securities, cash or other property or any combination thereof, Holders of Securities shall not have the right to thereafter convert their Securities into common stock of the surviving corporation or the corporation which shall have acquired such assets, but rather, shall have the right upon such conversion to receive the other securities, cash or other property receivable by a holder of the number of shares of Common Stock of the Issuer into which the Securities held by such holder might have been converted immediately prior to such consolidation, merger, share exchange, conveyance or sale, all as more fully provided in the first sentence of this Section 13.9. Anything in this Section 13.9 to the contrary notwithstanding, the provisions of this Section 13.9 shall not apply to a merger or consolidation of another corporation with or into the Issuer or any share exchange to which the Issuer is a party pursuant to which both of the following conditions are applicable: (i) the Issuer is the surviving or successor corporation and (ii) the outstanding shares of Common Stock of the Issuer are not changed or converted into any other securities or property (including cash) or changed in number or character or reclassified pursuant to the terms of such merger, consolidation or share exchange. As evidence of the kind and amount of shares of stock or other securities or property (including cash) into which Securities may properly be convertible after any such consolidation, merger, share exchange, conveyance or sale, or as to the appropriate adjustments of the conversion prices applicable with respect thereto, the Trustee shall be furnished with and may accept the certificate or opinion of an independent certified public accountant with respect thereto; and, in the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely thereon, and shall not be responsible or accountable to any Holder of Securities for any provision in conformity therewith or approved by such independent certified accountant which may be contained in said supplemental indenture. 68 75 SECTION 13.10. DUTIES OF TRUSTEE REGARDING CONVERSION. Neither the Trustee nor any conversion agent shall at anytime be under any duty or responsibility to any Holder of Securities of any series that is convertible into Common Stock of the Issuer to determine whether any facts exist which may require any adjustment of the conversion price, or with respect to the nature or extent of any such adjustment when made, or with respect to the method employed, whether herein or in any supplemental indenture, any resolutions of the Board of Directors or written instrument executed by one or more officers of the Issuer provided to be employed in making the same. Neither the Trustee nor any conversion agent shall be accountable with respect to the validity or value (or the kind or amount) of any shares of Common Stock of the Issuer, or of any securities or property, which may at any time be issued or delivered upon the conversion of any Securities and neither the Trustee nor any conversion agent makes any representation with respect thereto. Subject to the provisions of Section 6.1, neither the Trustee nor any conversion agent shall be responsible for any failure of the Issuer to issue, transfer or deliver any shares of its Common Stock or stock certificates or other securities or property upon the surrender of any Security for the purpose of conversion or to comply with any of the covenants of the Issuer contained in this Article Thirteen or in the applicable supplemental indenture, resolutions of the Board of Directors or written instrument executed by one or more duly authorized officers of the Issuer. SECTION 13.11. REPAYMENT OF CERTAIN FUNDS UPON CONVERSION. Any funds which at any time shall have been deposited by the Issuer or on its behalf with the Trustee or any other paying agent for the purpose of paying the principal of, and premium, if any, and interest, if any, on any of the Securities (including funds deposited for the sinking fund referred to in Article Twelve hereof) and which shall not be required for such purposes because of the conversion of such Securities as provided in this Article Thirteen shall after such conversion be repaid to the Issuer by the Trustee upon the Issuer's written request. ARTICLE 14 SUBORDINATION OF SECURITIES SECTION 14.1. SUBORDINATION OF THE SECURITIES. The Issuer covenants and agrees, and each holder of Securities, by his acceptance thereof, likewise covenants and agrees, that the indebtedness evidenced by the Securities (including coupons) and the payment of the principal thereof, premium, if any, and interest thereon shall be subordinate and subject in right of 69 76 payment, to the extent and in the manner hereinafter set forth, to the prior payment in full of all Senior Indebtedness. For purposes of this Article Fourteen, "Senior Indebtedness" means the principal of, premium, if any, and unpaid interest on the following, whether outstanding at the date hereof or thereafter incurred or created: (i) indebtedness of the Issuer for money borrowed (including purchase-money obligations) evidenced by notes or other written obligations, (ii) indebtedness of the Issuer evidenced by securities (other than the Securities), debentures, bonds or other securities issued under the provisions of an indenture or similar instrument, (iii) obligations of the Issuer as lessee under capitalized leases and leases of property made as part of any sale and leaseback transactions, (iv) indebtedness of others of any of the kinds described in the preceding clauses (i) through (iii) assumed or guaranteed by the Issuer and (v) renewals, extensions and refundings of, and indebtedness and obligations of a successor corporation issued in exchange for or in replacement of, indebtedness or obligations of the kinds described in the preceding clauses (i) through (iv), unless in the case of any particular indebtedness, obligation, renewal, extension or refunding the instrument creating or evidencing the same or the assumption or guarantee thereof expressly provides that such indebtedness, obligation, renewal, extension or refunding is not superior in right of payment to the Securities. The Issuer covenants and agrees that it will not incur any subordinated indebtedness (other than the Securities) unless such subordinated indebtedness is subordinate to Senior Indebtedness at least to the same extent that the Securities are subordinate to Senior Indebtedness. SECTION 14.2. NO PAYMENT ON SECURITIES IN EVENT OF DEFAULT ON SENIOR INDEBTEDNESS. The Issuer shall not make any payment on account of the principal of, or premium, if any, or interest on the Securities if, at the time thereof or immediately after giving effect thereto, there exists (and has not been waived) any default in the payment of principal of, premium, if any, or interest on any Senior Indebtedness or any event of default with respect to any Senior Indebtedness as defined therein (after giving effect to the giving of notice and any grace period provided for therein) or in any agreement pursuant to which any Senior Indebtedness is issued and the default is the subject of a judicial proceeding or the Issuer receives notice of the default from any holder of Senior Indebtedness or any trustee therefor; provided, however, that in the event the Securities have been declared due and payable pursuant to Section 5.1, the provisions of the next succeeding paragraph of this Section 14.2 shall be applicable. 70 77 In the event that any Event of Default as defined in Section 5.1 shall occur (under such circumstances that the provisions of Section 14.3 are not applicable) and as a result the Securities then Outstanding are declared due and payable pursuant to Section 5.1, and such declaration shall not have been rescinded or annulled, the Issuer shall promptly cause notice thereof to be mailed to all holders of Senior Indebtedness whose names and addresses are known to the Issuer (and not later than said mailing date shall also cause notice thereof to be published at least once in one Authorized Newspaper in New York, New York), and the Issuer shall not make any payment on account of the principal of, or premium, if any, or interest on any Securities, unless at least 120 days shall have elapsed after said declaration and unless all principal of, premium, if any, and interest on Senior Indebtedness due at the time of such payment (whether by acceleration of the maturity thereof or otherwise) shall first be paid in full. The Issuer shall give prompt written notice to the Trustee and any paying agent of the existence of any of the conditions described in this Section 14.2. SECTION 14.3. DISTRIBUTION ON DISSOLUTION, LIQUIDATION AND REORGANIZATION OF THE ISSUER. In the event of any payment or distribution of assets or securities of the Issuer of any kind or character, whether in cash, property or securities, to creditors upon any dissolution or winding up or total or partial liquidation or reorganization of the Issuer, whether voluntary or involuntary and whether in bankruptcy, insolvency or receivership proceedings, or upon an assignment for the benefit of creditors or any other marshaling of the assets and liabilities of the Issuer, or upon other proceedings: (a) all principal of, premium, if any, and interest due on all Senior Indebtedness shall first be paid in full, or due provision made for such payment in accordance with the terms of such Senior Indebtedness, before any payment is made on account of the principal of, premium, if any, or interest on the indebtedness evidenced by the Securities, or before the holders of the Securities shall be entitled to retain any assets so paid or distributed in respect thereof; and (b) any payment or distribution of assets or securities of the Issuer of any kind or character, whether in cash, property or securities (other than securities of the Issuer as reorganized or readjusted or securities of the Issuer or any other corporation provided for by a plan of reorganization or readjustment, which are in any such case subordinated to Senior Indebtedness to the same extent as the Securities), to which the holders of the Securities would be entitled except for the 71 78 provisions of this Section 14.3, shall be paid or delivered by the Issuer or any receiver, trustee in bankruptcy, liquidating trustee, agent or other person making such payment or distribution directly to the holders of Senior Indebtedness (pro rata to each such holder on the basis of the respective amount of Senior Indebtedness held by such holder) or their representative or representatives or 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 all Senior Indebtedness in full in accordance with the terms of such Senior Indebtedness, 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 of the Securities. The Issuer shall give prompt written notice to the Trustee and any paying agent of any dissolution, winding up, liquidation or reorganization of the Issuer within the meaning of this Section 14.3. SECTION 14.4. PAYMENT TO HOLDERS OF SENIOR INDEBTEDNESS. Subject to the provisions of Section 14.6, in the event that, notwithstanding the provisions of Section 14.2 or Section 14.3, any payment or distribution of assets of the Issuer of any kind or character, whether in cash, property or securities (other than securities of the Issuer as reorganized or readjusted or securities of the Issuer or any other corporation provided for by a plan of reorganization or readjustment, which are in any such case subordinated to Senior Indebtedness to the same extent as the Securities), shall be received by the holders of the Securities (i) from the Issuer in violation of such provisions, or (ii) from any other person under such circumstances that such payment would, if made directly by the Issuer, be in violation of such provisions, such payment or distribution shall immediately be paid over by such holders to the holders of Senior Indebtedness or their representative or representatives, or to the trustee or trustees under any indenture under which any instrument evidencing any of such Senior Indebtedness may have been issued, ratably according to the aggregate amounts then due on account of the principal of, premium, if any, and interest on such Senior Indebtedness (after giving effect to any concurrent payment or distribution to the holders of such Senior Indebtedness), to the extent necessary to pay in full all such amounts then due. Upon any payment or distribution of assets or securities of the Issuer referred to in Sections 14.2 and 14.3, the Trustee and any paying agent and the holders of the 72 79 Securities shall be entitled to rely upon any order or decree of a court of competent jurisdiction, or upon any certificate of any liquidating trustee or agent or other person making any payment or distribution to the Trustee and any paying agent or to the holders of the Securities, for the purpose of ascertaining the persons entitled to participate in such payment or distribution, the holders of Senior Indebtedness, the amount thereof or payment thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Section. In the absence of any such order, decree, liquidating trustee, agent or other Person, the Trustee and each paying agent shall be entitled to rely upon a written notice by a Person representing himself to be a holder of Senior Indebtedness (or a trustee or representative on behalf of such holder) as evidence that such Person is a holder of Senior Indebtedness (or is such a trustee or representative). In the event that the Trustee or any paying agent 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 referred to in Sections 14.2 and 14.3, the Trustee or any paying agent may request such Person to furnish evidence to the reasonable satisfaction of the Trustee or any paying agent as to the amount of Senior Indebtedness held by such Person, as to the extent to which such Person is entitled to participation in such payment or distribution, and as to other facts pertinent to the rights of such Person under Sections 14.2 and 14.3, and if such evidence is not furnished, the Trustee or any paying agent may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment. SECTION 14.5. SUBROGATION. Subject to the payment in full of all amounts then due (whether by acceleration of the maturity thereof or otherwise) on account of the principal of, premium, if any, and interest on all Senior Indebtedness at the time outstanding, the holders of the Securities shall be subrogated to the rights of each holder of Senior Indebtedness (to the extent of the payments or distributions made to such holder pursuant to the provisions of Sections 14.2, 14.3 and 14.4 to receive payments or distributions of assets or securities of the Issuer applicable to the Senior Indebtedness until the Securities shall be paid in full, and each holder of Senior Indebtedness by the act of accepting such payments or distributions pursuant to the provisions of Sections 14.2, 14.3 and 14.4 shall be deemed to have agreed to the subrogation aforesaid. No payments or distributions of assets or securities of the Issuer applicable to Senior Indebtedness which the holders of the Securities receive by reason of their being subrogated to the rights of the holders of such Senior Indebtedness pursuant to the provisions of Section 14.2, 14.3 and 14.4 shall, as between the Issuer, its creditors other than the holders of Senior 73 80 Indebtedness, and the holders of the Securities, be deemed to be a payment by the Issuer on account of the Securities, it being understood that the provisions of this Section are intended solely for the purpose of defining the relative rights of the holders of the Securities, on the one hand, and the holders of the Senior Indebtedness, on the other hand, and nothing contained in this Section or elsewhere in this Agreement, or in the Securities, is intended to or shall impair, as between the Issuer, its creditors other than the holders of Senior Indebtedness, and the holders of the Securities, the obligation of the Issuer, which is absolute and unconditional, to pay to the holders of the Securities the principal of, premium, if any, and interest on the Securities, as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the holders of the Securities and creditors of the Issuer other than the holders of Senior Indebtedness, nor shall anything herein or therein prevent the Trustee or the holder of any Security from exercising all remedies otherwise permitted by applicable law upon default under this Agreement, subject to the rights, if any, under this Section of the holders of Senior Indebtedness in respect of cash, property or securities of the Issuer received upon the exercise of any such remedy. SECTION 14.6. PAYMENT ON SECURITIES PERMITTED. Nothing contained in this Section or elsewhere in this Agreement, or in any of the Securities, shall prevent the Issuer from making payment of the principal of, premium, if any, or interest on the Securities, at any time, except under the conditions described in Section 14.2 and except during the pendency of any dissolution, winding up, liquidation or reorganization of the Issuer within the meaning of Section 14.3. Nothing contained in this Section or elsewhere in this Agreement, or in any of the Securities, shall prevent the application by the Trustee of any moneys deposited with it hereunder for the purpose, to the payment of or on account of the principal of, or premium, if any, or interest on the Securities, unless, prior to the Business Day next preceding the date upon which such principal or premium shall have become payable, or, in the case of any payment of or on account of interest unless, prior to two Business Days before the date upon which such interest shall have become payable, the Trustee shall have received written notice from the Issuer or any holder of Senior Indebtedness or any trustee therefor of the existence of any of the conditions described in Section 14.2 or of any dissolution, winding up, liquidation or reorganization of the Issuer within the meaning of Section 14.3. SECTION 14.7. AUTHORIZATION OF HOLDERS TO TRUSTEE TO EFFECT SUBORDINATION. Each holder of Securities by his acceptance thereof authorizes and directs the Trustee and any 74 81 paying agent on such holder's behalf to take such action as may be necessary or appropriate to effectuate, as between the holders of the Securities and the holders of Senior Indebtedness, the subordination provided in this Section and appoints the Trustee and any paying agent his attorney-in-fact for any and all such purposes. SECTION 14.8. TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS. The Trustee or any paying agent shall be entitled to all the rights set forth in this Section 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 this Agreement shall deprive or be construed to deprive the Trustee of its rights as such holder. SECTION 14.9. NOTICES TO TRUSTEE. Notwithstanding the provisions of this Section or any other provisions of this Agreement, the Trustee or any paying agent shall not be charged with the knowledge of the existence of any Senior Indebtedness or of any facts which would prohibit the making of any payment of moneys to or by the Trustee or any paying agent, unless and until the Trustee or any paying agent shall have received written notice thereof from the Issuer or any holder of Senior Indebtedness or any trustee thereof. SECTION 14.10. NO FIDUCIARY DUTY BY TRUSTEE TO HOLDERS OF SENIOR INDEBTEDNESS. The Trustee and any paying agent shall not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness and shall not be liable to any such holders if the Trustee or any paying agent shall mistakenly pay over or distribute to holders of Securities or the Issuer or any other Person moneys or assets to which any holders of Senior Indebtedness shall be entitled by virtue of this Section or otherwise. 75 82 IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of _______, 199_. THE CHUBB CORPORATION By________________________ [CORPORATE SEAL] Attest: By________________________ THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By________________________ [CORPORATE SEAL] Attest: By________________________ 76 83 STATE OF ) ) ss.: COUNTY OF ) On this day of , before me personally came , to me personally known, who, being by me duly sworn, did depose and say that she resides ; that she is a of The Chubb Corporation, one of the corporations described in and which executed the above instrument; that she knows the corporate seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that she signed her name thereto by like authority. [NOTARIAL SEAL] _________________________ Notary Public STATE OF ) ) ss.: COUNTY OF ) On this day of , before me personally came , to me personally known, who, being by me duly sworn, did depose and say that she resides ; that she is a of The First National Bank of Chicago, one of the corporations described in and which executed the above instrument; that he knows the corporate seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that he signed his name thereto by like authority. [NOTARIAL SEAL] _________________________ Notary Public 77 84 Exhibit (Form 1) [FORM OF FACE OF NOTE] No. $ THE CHUBB CORPORATION % Note Due THE CHUBB CORPORATION, a New Jersey corporation (the "Issuer"), for value received, hereby promises to pay to or registered assigns, at the office or agency of the Issuer in the Borough of Manhattan, the City of New York, the principal sum of Dollars on , in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, and to pay interest, semiannually on and of each year, commencing , , on said principal sum at said office or agency, in like coin or currency, at the rate per annum specified in the title of this Note, from the or the , as the case may be, next preceding the date of this Note to which interest has been paid, unless the date hereof is a date to which interest has been paid, in which case from the date of this Note, or unless no interest has been paid on these Notes, in which case from , , until payment of said principal sum has been made or duly provided for; provided, that payment of interest may be made at the option of the Issuer by check mailed to the address of the person entitled thereto as such address shall appear on the Security register. Notwithstanding the foregoing, if the date hereof is after the day of or , as the case may be, and before the following or , this Note shall bear interest from such or ; provided, that if the Issuer shall default in the payment of interest due on such or , then this Note shall bear interest from the next preceding or , to which interest has been paid or, if no interest has been paid on these Notes, from . 1 85 The interest so payable on any or , will, subject to certain exceptions provided in the Indenture referred to on the reverse hereof, be paid to the person in whose name this Note is registered at the close of business on the or , as the case may be, next preceding such or . The indebtedness evidenced by this Note is, to the extent provided in the Indenture, subordinate and subject in right of payment to the prior payment in full of all Senior Indebtedness, and this Note is issued subject to the provisions of the Indenture with respect thereto. Each Holder of this Security, by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and directs the Trustee on his behalf to take such action as may be necessary or appropriate to effectuate the subordination so provided and (c) appoints the Trustee his attorney-in-fact for any and all such purposes. Reference is made to the further provisions of this Note set forth on the reverse hereof. Such further provisions shall for all purposes have the same effect as though fully set forth at this place. This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by the Trustee under the Indenture referred to on the reverse hereof. IN WITNESS WHEREOF, The Chubb Corporation has caused this instrument to be signed by facsimile by its duly authorized officers and has caused a facsimile of its corporate seal to be affixed hereunto or imprinted hereon. Dated: THE CHUBB CORPORATION By______________________________ By______________________________ 2 86 [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION] This is one of the Securities of the series designated herein referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By______________________________ Authorized Officer 3 87 [FORM OF REVERSE OF NOTE] [FOR PURPOSES OF SECTION 1232 OF THE UNITED STATES INTERNAL REVENUE CODE OF 1954, AS AMENDED, THE ISSUE PRICE OF THIS [ ] IS % OF ITS PRINCIPAL AMOUNT AND THE ISSUE DATE IS , .] THE CHUBB CORPORATION % Note Due This Note is one of a duly authorized issue of debentures, notes, bonds or other evidences of indebtedness of the Issuer (hereinafter called the "Securities") of the series hereinafter specified, all issued or to be issued under and pursuant to an indenture dated as of October 25, 1989 (herein called the "Indenture"), between the Issuer and The First National Bank of Chicago, as Trustee (herein called the "Trustee" which term includes any successor Trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Issuer and the Holders of the Securities. The Securities may be issued in one or more series, which different series may be issued in various aggregate principal amounts, may mature at different times, may bear interest (if any) at different rates, may be subject to different redemption provisions (if any), may be subject to different sinking, purchase or analogous funds (if any) and may otherwise vary as in the Indenture provided. This Note is one of a series designated as the % Notes Due (the "Notes") of the Issuer, limited in aggregate principal amount to $ . [The Indenture contains provisions for the defeasance at any time of the entire indebtedness of this Note upon compliance by the Issuer of certain conditions set forth therein, which provisions apply to this Note.] In case an Event of Default, as defined in the Indenture, with respect to the Notes, shall have occurred and be continuing, the principal hereof may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. 4 88 The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the Holders of not less than a majority in aggregate principal amount of the Securities at the time Outstanding (as defined in the Indenture) of all series to be affected (voting as one class), evidenced as in the Indenture provided, to execute supplemental indentures adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the Holders of the Securities of each such series; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Security, or reduce the principal amount thereof or any premium thereon, or reduce the rate or extend the time of payment of any interest thereon, or reduce any amount payable on redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof or provable in bankruptcy, or change the currency of payments of principal, premium, if any, or interest, or extend the time or reduce the amount of any payment to any sinking fund or analogous obligation relating to any Security, or impair or affect the rights of any Holder to institute suit for the payment thereof, without the consent of the Holder of each Security so affected, or (ii) reduce the aforesaid percentage of Securities, the Holders of which are required to consent to any such supplemental indenture, without the consent of the Holder of each Security affected or (iii) reduce the percentage of Securities of this series outstanding necessary to consent to waive any past default under the Indenture to less than a majority, without the consent of the Holder of each Security so affected, or (iv) modify the provisions of the sections of the Indenture dealing with supplementary indentures or waivers of covenants, except to increase any such percentage or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Security affected thereby, provided, however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to "the Trustee" and concomitant changes in such sections of the Indenture or the deletion of this proviso, in accordance with the requirements of the Indenture. It is also provided in the Indenture that, with respect to certain defaults or Events of Default regarding the Securities of any series, prior to any declaration accelerating the maturity of such Securities, the Holders of a majority in aggregate principal amount Outstanding of the Securities of such series (or, in the case of certain defaults or Events of Default, all or certain series of the Securities) may on behalf of the Holders of all the Securities of such series (or all or certain series of the Securities, as the case may be) waive any such past default or Event of Default and its consequences. The preceding sentence 5 89 shall not, however, apply to a default in the payment of the principal of or premium, if any, or interest on any of the Securities. Any such consent or waiver by the Holder of this Note (unless revoked as provided in the Indenture) shall be conclusive and binding upon such Holder and upon all future Holders and owners of this Note and any Notes which may be issued in exchange or substitution herefor, irrespective of whether or not any notation thereof is made upon this Note or such other Notes. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and any premium and interest on this Note in the manner, at the respective times, at the rate and in the coin or currency herein prescribed. The Notes are issuable in registered form without coupons in denominations of $ and any multiple of $ at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, and in the manner and subject to the limitations provided in the Indenture, but without the payment of any service charge. Notes may be exchanged for a like aggregate principal amount of Notes of other authorized denominations. [The Notes may be redeemed at the option of the Issuer, as a whole, or from time to time in part, on any date [after [__________] and] prior to maturity, upon mailing a notice of such redemption not less than 30 nor more than 60 days prior to the date fixed for redemption to the Holders of Notes at their last registered addresses, all as further provided in the Indenture, at the following optional redemption prices (expressed in percentages of the principal amount) together in each case with accrued interest to the date fixed for redemption: If redeemed during the twelve-month period beginning ,
Year Percentage Year Percentage - ---- ---------- ---- ----------
[As and for a sinking fund for the retirement of the Notes and so long as any of the Notes remain outstanding and unpaid, the Issuer will pay to the Trustee in cash [(subject to the right to deliver certain Notes in credit therefor as in the 6 90 Indenture provided)], on or before and on or before in each year thereafter to and including an amount sufficient to redeem $____________ principal amount of the Notes (or such lesser amount equal to the principal amount then Outstanding) at 100% of the principal amount thereof (the "sinking fund redemption price"), together with accrued interest to the date fixed for redemption. The Notes shall be redeemed through the operation of the sinking fund as herein provided on and on each thereafter to and including on notice as set forth in the Indenture. [At its option the Issuer may pay into the sinking fund for the retirement of Notes, in cash except as provided in the Indenture, on or before and on or before in each year thereafter to and including an amount sufficient to redeem an additional principal amount of Notes up to but not to exceed $__________ at the sinking fund redemption price. To the extent that the right to such optional sinking fund payment is not exercised in any year, it shall not be cumulative or carried forward to any subsequent year.] The Trustee shall select Notes for redemption, by prorating, as nearly as may be, the principal amount of Notes to be redeemed among the Holders of Notes. The Trustee shall make such adjustments, reallocations and eliminations to such proration as it shall deem proper to the end that the principal amount of Notes so redeemed shall be $1,000 or a multiple thereof, by increasing or decreasing or eliminating the amount which would be allocable to any Holder on the basis of exact proration by an amount not exceeding $1,000. The Trustee in its discretion may determine the particular Notes (if there are more than one) registered in the name of any Holder which are to be redeemed, in whole or in part.] [Subject to the provisions of the Indenture, the Holder of this Note is entitled, at its option, at any time on or before __________ (except that, in case this Note or any portion hereof shall be called for redemption, such right shall terminate with respect to this Note or portion hereof, as the case may be, so called for redemption at the close of business on the date fixed for redemption as provided in the Indenture unless the Issuer defaults in making the payment due upon redemption), to convert the principal amount of this Note (or any portion hereof which is $1,000 or an integral multiple thereof), into fully paid and non- assessable shares (calculated as to each conversion to the nearest 1/100th of a share) of the Common Stock of the Issuer, as said shares shall be constituted at the date of conversion, at the conversion price of $_____ principal amount of Notes for each share of Common Stock, or at the adjusted conversion price in effect at the date of conversion determined as provided in the Indenture, upon surrender of this Note, together with the conversion notice hereon duly executed, to the Issuer at the designated office or agency of the Issuer in 7 91 ____________________, accompanied (if so required by the Issuer) by instruments of transfer, in form satisfactory to the Issuer and to the Trustee, duly executed by the Holder or by its duly authorized attorney in writing. Such surrender shall, if made during any period beginning at the close of business on a record date and ending at the opening of business on the interest payment date next following such record date (unless this Note or the portion being converted shall have been called for redemption on a date fixed for redemption during such period), also be accompanied by payment in funds acceptable to the Issuer of an amount equal to the interest payable on such interest payment date on the principal amount of this Note then being converted. Subject to the aforesaid requirement for payment and, in the case of a conversion after the record date next preceding any interest payment date and on or before such interest payment date, to the right of the Holder of this Note (or any predecessor security) of record at such record date to receive an installment of interest (with certain exceptions provided in the Indenture), no adjustment is to be made on conversion for interest accrued hereon or for dividends on shares of Common Stock issued on conversion. The Issuer is not required to issue fractional shares upon any such conversion, but shall make adjustment therefor in cash on the basis of the current market value of such fractional interest as provided in the Indenture. The conversion price is subject to adjustment as provided in the Indenture. In addition, the Indenture provides that in case of certain consolidations, mergers or share exchanges to which the Issuer is a party or the sale of substantially all of the assets of the Issuer, the Indenture shall be amended, without the consent of any Holders of Securities, so that this Note, if then outstanding, will be convertible thereafter, during the period this Note shall be convertible as specified above, only into the kind and amount of securities, cash and other property receivable upon the consolidation, merger, share exchange or sale by a holder of the number of shares of Common Stock into which this Note might have been converted immediately prior to such consolidation, merger, share exchange or sale (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount received per share by a plurality of non-electing shares). In the event of conversion of this Note in part only, a new Note or Notes for the unconverted portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof. Upon due presentment for registration of transfer of this Note at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, a new Note or Notes of authorized denominations for an equal aggregate principal amount will be issued to the transferee in exchange therefor, subject to the limitations provided in the Indenture, without charge except 8 92 for any tax or other governmental charge imposed in connection therewith. The Issuer, the Trustee and any authorized agent of the Issuer or the Trustee may deem and treat the registered Holder hereof as the absolute owner of this Note (whether or not this Note shall be overdue and notwithstanding any notation of ownership or other writing hereon), for the purpose of receiving payment of, or on account of, the principal hereof and premium, if any, and subject to the provisions on the face hereof, interest hereon, and for all other purposes, and neither the Issuer nor the Trustee nor any authorized agent of the Issuer or the Trustee shall be affected by any notice to the contrary. No recourse under or upon any obligation, covenant or agreement of the Issuer in the Indenture or any indenture supplemental thereto or in any Note, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, officer or director, as such, of the Issuer or of any successor corporation, either directly or through the Issuer or any successor corporation, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance hereof and as part of the consideration for the issue hereof. Terms used herein which are defined in the Indenture shall have the respective meanings assigned thereto in the Indenture. 9 93 FORM OF CONVERSION NOTICE To The Chubb Corporation The undersigned owner of this Security hereby irrevocably exercises the option to convert this Security, or portion hereof (which is $1,000 or an integral multiple thereof) below designated, into shares of Common Stock of the Issuer in accordance with the terms of the Indenture referred to in this Security, and directs that the shares issuable and deliverable upon the conversion, together with any check in payment for fractional shares and any Securities representing any unconverted principal amount hereof, be issued and delivered to the registered holder hereof unless a different name has been indicated below. If this Security is being delivered on a date after the close of business on a record date and prior to the opening of business on the related interest payment date (unless this Security or the portion thereof being converted has been called for redemption on a date fixed for redemption within such period), this Notice is accompanied by payment, in funds acceptable to the Issuer, of an amount equal to the interest payable on such interest payment date of the principal of this Security to be converted. If shares are to be issued in the name of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect hereto. Any amount required to be paid by the undersigned on an account of interest accompanies this Security. Principal Amount to be Converted (in an integral multiple of $1,000, if less than all): $__________ Dated ___________________ ______________________________ Signature Signature(s) must be guaranteed by a commercial bank or trust company or a member firm of a national stock exchange if shares of Common Stock are to be delivered, or Securities to be issued, other than to and in the name of the registered holder. 94 ______________________________ Signature Guarantee Fill in for registration of shares of Common Stock and Security if to be issued otherwise than to the registered holder. _________________________ Social Security or other Taxpayer (Name) Identifying Number ______________ _________________________ (Address) _________________________ Please print Name and Address (including zip code number) 2 95 Exhibit (Form 2) [FORM OF FACE OF ZERO COUPON SECURITY] No. $ THE CHUBB CORPORATION Zero Coupon [ ] THE CHUBB CORPORATION, a New Jersey corporation (the "Issuer"), for value received, hereby promises to pay to or registered assigns, at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, the principal sum of Dollars on , in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts. The principal of this [ ] shall not bear interest, except in the case of default in payment of principal upon acceleration, redemption or maturity, and in such case the amount in default shall bear interest at the rate of % per annum (to the extent enforceable under applicable law) from the date of default in payment to the date such payment has been made or duly provided for, at said office or agency and in like coin or currency. The indebtedness evidenced by this [______] is, to the extent provided in the Indenture, subordinate and subject in right of payment to the prior payment in full of all Senior Indebtedness, and this [_____] is issued subject to the provisions of the Indenture with respect thereto. Each Holder of this [_____], by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and directs the Trustee on his behalf to take such action as may be necessary or appropriate to effectuate the subordination so provided and (c) appoints the Trustee his attorney-in-fact for any and all such purposes. 1 96 Reference is made to the further provisions of this [ ] set forth on the reverse hereof. Such further provisions shall for all purposes have the same effect as though fully set forth at this place. This [ ] shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by the Trustee under the Indenture referred to on the reverse hereof. IN WITNESS WHEREOF, The Chubb Corporation has caused this instrument to be signed by facsimile by its duly authorized officers and has caused a facsimile of its corporate seal to be affixed hereunto or imprinted hereon. Dated: THE CHUBB CORPORATION By______________________________ By______________________________ [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION] This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By__________________________ Authorized Officer 2 97 [FORM OF REVERSE OF ] FOR THE PURPOSES OF SECTION 1232 OF THE UNITED STATES INTERNAL REVENUE CODE OF 1954, AS AMENDED, THE ISSUE PRICE OF THIS [ ] IS % OF ITS PRINCIPAL AMOUNT AND THE ISSUE DATE IS , . The Chubb Corporation Zero Coupon [ ] Due This [ ] is one of a duly authorized issue of debentures, notes, bonds or other evidences of indebtedness of the Issuer (hereinafter called the "Securities") of the series hereinafter specified, all issued or to be issued under and pursuant to an indenture dated as of October 25, 1989 (herein called the "Indenture"), duly executed and delivered by the Issuer to The First National Bank of Chicago, Trustee (herein called the "Trustee"), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Issuer and the holders of the Securities. The Securities may be issued in one or more series, which different series may be issued in various aggregate principal amounts, may mature at different times, may bear interest (if any) at different rates, may be subject to different redemption provisions (if any), may be subject to different sinking, purchase or analogous funds (if any) and may otherwise vary as in the Indenture provided. This [ ] is one of a series designated as the Zero Coupon [ ] Due of the Issuer, limited in aggregate principal amount to $ . In case an Event of Default, as defined in the Indenture, with respect to the Zero Coupon [ ], shall have occurred and be continuing, (i) that portion of the principal equal to the initial public offering price of this [ ] plus accrued amortization of the original issue discount calculated using the "interest" method (computed in accordance with generally accepted accounting principles in effect on the date of the Indenture) from , to the date of acceleration may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. 3 98 The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the Holders of not less than a majority in aggregate principal amount of the Securities at the time Outstanding (as defined in the Indenture) of all series to be affected (voting as one class), evidenced as in the Indenture provided, to execute supplemental indentures adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the Holders of the Securities of each such series; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Security, or reduce the principal amount thereof or any premium thereon, or reduce the rate or extend the time of payment of interest thereon, or reduce any amount payable on redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon acceleration or provable in bankruptcy, or change the currency of payment of principal, premium or interest, or extend the time or reduce the amount of any payment to any sinking fund or analogous obligation relating to any Security, or impair or affect the rights of any Holder to institute suit for the payment thereof, without the consent of the Holder of each Security so affected, or (ii) reduce the aforesaid percentage of Securities, the Holders of which are required to consent to any such supplemental indenture, without the consent of the Holder of each Security affected or (iii) reduce the percentage of Securities of this series outstanding necessary to consent to waive any past default under the Indenture to less than a majority, without the consent of the Holder of each Security affected or (iv) modify the provisions of the sections of the Indenture dealing with supplementary indentures or waivers of covenants, except to increase any such percentage or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Security affected thereby, [provided, however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to "the Trustee" and concomitant changes in such sections of the Indenture or the Deletion of this proviso, in accordance with the requirements of the Indenture.] It is also provided in the Indenture that, with respect to certain defaults or Events of Default regarding the Securities of any series, prior to any declaration accelerating the maturity of the Securities of any series, the Holders of a majority in aggregate principal amount Outstanding of the Securities of such series (or, in the case of certain defaults or Events of Default, all or certain series of the Securities) may on behalf of the Holders of all the Securities of such series (or all or certain series of the Securities, as the case may be) waive any such past default or Event of Default and its consequences. The preceding sentence shall not, however, apply to a default in the payment of 4 99 the principal of, or interest, if any, on any of the Securities. Any such consent or waiver by the Holder of this [ ] (unless revoked as provided in the Indenture) shall be conclusive and binding upon such Holder and upon all future Holders and owners of this [ ] and any [ ] which may be issued in exchange or substitution herefor, irrespective of whether or not any notation thereof is made upon this [ ] or such other [ ]. No reference herein to the Indenture and no provision of this [ ] or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest, if any, on this [ ] in the manner, at the respective times, at the rate and in the coin or currency herein prescribed. The [ ] are issuable in registered form without coupons in denominations of $ or any multiple of $ at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, and in the manner and subject to the limitations provided in the Indenture, but without the payment of any service charge, [ ] may be exchanged for a like aggregate principal amount of [ ] of other authorized denominations. [The [ ] may be redeemed at the option of the Issuer, as a whole, or from time to time in part, on any date prior to maturity, upon mailing a notice of such redemption to the holders of [ ] at their last registered addresses, all as further provided in the Indenture, at the redemption price of 100% of the principal amount thereof.] [Subject to the provisions of the Indenture, the Holder of this [______] is entitled, at its option, at any time on or before __________ (except that, in case this [______] or any portion hereof shall be called for redemption, such right shall terminate with respect to this [______] or portion hereof, as the case may be, so called for redemption at the close of business on the date fixed for redemption as provided in the Indenture unless the Issuer defaults in making the payment due upon redemption), to convert the principal amount of this [________] (or any portion hereof which is $1,000 or an integral multiple thereof), into fully paid and non-assessable shares (calculated as to each conversion to the nearest 1/100th of a share) of the Common Stock of the Issuer, as said shares shall be constituted at the date of conversion, at the conversion price of $_____ principal amount of [______] for each share of Common Stock, or at the adjusted conversion price in effect at the date of conversion determined as provided in the Indenture, upon surrender of this [______], together with the conversion notice hereon duly executed, to the Issuer at the designated office or agency of the Issuer in 5 100 ____________________, accompanied (if so required by the Issuer) by instruments of transfer, in form satisfactory to the Issuer and to the Trustee, duly executed by the Holder or by its duly authorized attorney in writing. Such surrender shall, if made during any period beginning at the close of business on a record date and ending at the opening of business on the interest payment date next following such record date (unless this [_____] or the portion being converted shall have been called for redemption on a date fixed for redemption during such period), also be accompanied by payment in funds acceptable to the Issuer of an amount equal to the interest payable on such interest payment date on the principal amount of this [_____] then being converted. Subject to the aforesaid requirement for payment and, in the case of a conversion after the record date next preceding any interest payment date and on or before such interest payment date, to the right of the Holder of this [_____] (or any predecessor security) of record at such record date to receive an installment of interest (with certain exceptions provided in the Indenture), no adjustment is to be made on conversion for interest accrued hereon or for dividends on shares of Common Stock issued on conversion. The Issuer is not required to issue fractional shares upon any such conversion, but shall make adjustment therefor in cash on the basis of the current market value of such fractional interest as provided in the Indenture. The conversion price is subject to adjustment as provided in the Indenture. In addition, the Indenture provides that in case of certain consolidations, mergers or share exchanges to which the Issuer is a party or the sale of substantially all of the assets of the Issuer, the Indenture shall be amended, without the consent of any Holders of Securities, so that this Security, if then outstanding, will be convertible thereafter, during the period this [______] shall be convertible as specified above, only into the kind and amount of securities, cash and other property receivable upon the consolidation, merger, share exchange or sale by a holder of the number of shares of Common Stock into which this [_____] might have been converted immediately prior to such consolidation, merger, share exchange or sale (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount received per share by a plurality of non-electing shares). In the event of conversion of this [______] in part only, a new [_____] or [_____] for the unconverted portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof. Upon due presentment for registration of transfer of this [ ] at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, a new [ ] or [ ] of authorized denominations for an equal aggregate principal amount will be issued to the transferee in exchange therefor, subject to 6 101 the limitations provided in the Indenture, without charge except for any tax or other governmental charge imposed in connection therewith. The Issuer, the Trustee and any authorized agent of the Issuer or the Trustee may deem and treat the registered Holder hereof as the absolute owner of this [ ] (whether or not this [ ] shall be overdue and notwithstanding any notation of ownership or other writing hereon, for the purpose of receiving payment hereof, or on account hereof, and for all other purposes, and neither the Issuer nor the Trustee nor any authorized agent of the Issuer or the Trustee shall be affected by any notice to the contrary. No recourse under or upon any obligation, covenant or agreement of the Issuer in the Indenture or any indenture supplemental thereto or in any [ ], or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, officer or director, as such, of the Issuer or of any successor corporation, either directly or through the Issuer or any successor corporation, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance hereof and as part of the consideration for the issue hereof. Terms used herein which are defined in the Indenture shall have the respective meanings assigned thereto in the Indenture. 7 102 Exhibit (Form 3) [FORM OF FACE OF EXTENDIBLE NOTE] No. $ THE CHUBB CORPORATION - Year Extendible Note THE CHUBB CORPORATION, a New Jersey corporation (the "Issuer"), for value received, hereby promises to pay to or registered assigns, at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, the principal sum of Dollars on , in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, and to pay interest, (at the rate per annum from time to time in effect as described below) semiannually on and of each year, commencing , , on said principal sum at said office or agency, in like coin or currency, from the or the , as the case may be, next preceding the date of this Note to which interest has been paid, unless the date hereof is a date to which interest has been paid, in which case from the date of this Note, or unless no interest has been paid on these Notes, in which case from , , until payment of said principal sum has been made or duly provided; provided, however, that payment of interest may be made at the option of the Issuer by check mailed to the address of the person entitled thereto as such address shall appear on the Security register. Notwithstanding the foregoing, if the date hereof is after the day of or , as the case may be, and before the following or , this Note shall bear interest from such or ; provided, however, that if the Company shall default in the payment of interest due on such or , then this Note shall bear interest from the next preceding or , to which interest has been paid or, if no interest has been paid on these 1 103 Notes, from . The interest so payable on any or , will, subject to certain exceptions provided in the Indenture referred to on the reverse hereof, be paid to the person in whose name this Note is registered at the close of business on such or , as the case may be, next preceding such or . Interest on these Notes is payable at the rate of % per annum from through , and for each -month period beginning , and , at a rate per annum established by the Issuer on the preceding each such , or at a rate per annum determined by a method established by the Issuer on the preceding each such . The Issuer shall establish the interest rate or method to be used to determine such interest rate by delivery to the Trustee of an Officers' Certificate on such . On or before the prior to the commencement of the -month period to which it applies, the Trustee shall cause notice of such interest rate or the method to be used in ascertaining the interest rate on the following and the interest rate that would have been applicable to such -month period had such determination been made as of such , all as specified in the aforesaid Officers' Certificate, to be mailed to each holder of these Notes. The Issuer shall cause notice of the interest rate established as of the preceding the commencement of the -month period to be enclosed with the interest payment checks mailed to the Holders of the Notes for the period ending on the following such . The Notes of this series are subject to repayment on , , and , at the option of the Holders thereof exercisable on or before the , but not prior to the preceding such , at a repayment price equal to the principal amount thereof to be repaid, together with interest payable thereon to the repayment date, as described on the reverse side hereof. The indebtedness evidenced by this Note is, to the extent provided in the Indenture, subordinate and subject in right of payment to the prior payment in full of all Senior Debt, and this Note is issued subject to the provisions of the Indenture with respect thereto. Each Holder of this Note, by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and directs the Trustee on his behalf to take such action as may be necessary or appropriate to effectuate the subordination so provided and (c) appoints the Trustee his attorney-in-fact for any and all such purposes. 2 104 Reference is made to the further provisions of this Note set forth on the reverse hereof. Such further provisions shall for all purposes have the same effect as though fully set forth at this place. This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by the Trustee under the Indenture referred to on the reverse hereof. IN WITNESS WHEREOF, The Chubb Corporation has caused this instrument to be signed by facsimile by its duly authorized officers and has caused a facsimile of its corporate seal to be affixed hereunto or imprinted hereon. Dated: THE CHUBB CORPORATION By______________________________ By______________________________ [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION] This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By__________________________ Authorized Officer 3 105 [FORM OF REVERSE OF -YEAR EXTENDIBLE NOTE] The Chubb Corporation -Year Extendible Note This Note is one of a duly authorized issue of debentures, notes, bonds or other evidences of indebtedness of the Issuer (the "Securities") of the series hereinafter specified, all issued or to be issued under an indenture dated as of October __, 1989 (herein called the "Indenture"), duly executed and delivered by the Issuer to The First National Bank of Chicago, Trustee (herein called the "Trustee"), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Issuer and the holders of the Securities. The Securities may be issued in one or more series, which different series may be issued in various aggregate principal amounts, may mature at different times, may bear interest (if any) at different rates, may be subject to different redemption provisions (if any), may be subject to different sinking, purchase or analogous funds (if any) and may otherwise vary as in the Indenture provided. This Note is one of a series designated as the -Year Extendible Notes of the Issuer, limited in aggregate principal amount to $ . The -Year Extendible Notes may be redeemed at the option of the Issuer as a whole or in part, or from time to time in part, on any date (i) on or after , , and prior to , (ii) on or after , , and prior to , (iii) on or after , , and prior to , and (iv) on or after , and prior to maturity upon mailing a notice of such redemption not less than 30 nor more than 60 days prior to the date fixed for redemption to the Holders of Notes at their last registered addresses, all as further provided in the Indenture at 100% of the principal amount thereof, together with accrued interest to the date fixed for redemption. If this Note is redeemed in part, the principal amount that remains Outstanding shall not be less than $ .] 4 106 In case an Event of Default, as defined in the Indenture, with respect to the -Year Extendible Notes, shall have occurred and be continuing, the principal hereof may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the Holders of not less than a majority in aggregate principal amount of the Securities at the time Outstanding (as defined in the Indenture) of all series to be affected (voting as one class), evidenced as in the Indenture provided, to execute supplemental indentures adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the Holders of the Securities of each such series; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Security, or reduce the principal amount thereof or any premium thereon, or reduce the principal amount thereof or any premium thereon, or reduce the rate or extend the time of payment of any interest thereon, or reduce any amount payable on redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof or provable in bankruptcy, or change the currency of payment of principal, premium or interest, or extend the time or reduce the amount of any payment to any sinking fund or analogous obligation relating to any Security, or impair or affect the rights of any Holder to institute suit for the payment thereof, without the consent of the Holder of each Security so affected, or (ii) reduce the aforesaid percentage of Securities, the Holders of which are required to consent to any such supplemental indenture, without the consent of the Holder of each Security affected or (iii) reduce the percentage of Securities of this series outstanding to consent to waive any past default under the Indenture to less than a majority, without the consent of the Holder of each Security affected, or (iv) modify the provisions of the sections of the Indenture dealing with supplementary indentures or waivers of covenants, except to increase any such percentage or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Security affected thereby, [provided, however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to "the Trustee" and concomitant changes in such sections of the Indenture or the Deletion of this proviso, in accordance with the requirements of the Indenture.] It is also provided in the Indenture that, with respect to certain defaults or Events of Default regarding the Securities of any series, prior to any declaration accelerating 5 107 the maturity of such Securities, the Holders of a majority in aggregate principal amount Outstanding of the Securities of such series (or, in the case of certain defaults or Events of Default, all or certain series of the Securities) may on behalf of the Holders of all the Securities of such series (or all or certain series of the Securities, as the case may be) waive any such past default or Event of Default. The preceding sentence shall not, however, apply to a default in the payment of the principal of or premium, if any, or interest, on any of the Securities. Any such consent or waiver by the Holder of this Note (unless revoked as provided in the Indenture) shall be conclusive and binding upon such Holder and upon all future Holders and owners of this Note and any -Year Extendible Notes which may be issued in exchange or substitution herefor, irrespective of whether or not any notation thereof is made upon this Note or such other -Year Extendible Notes. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and premium, if any, and interest on this Note in the manner, at the respective times, at the rate and in the coin or currency herein prescribed. The -Year Extendible Notes are subject to repayment in whole, or in part, on , , and , in increments of $ or multiples of $ in excess of $ , provided that the portion of the principal amount of any -Year Extendible Note not being repaid shall be at least $ , at the option of the Holders thereof at a repayment price equal to the principal amount thereof to be repaid, together with interest payable thereon to the repayment date. For this Note to be repaid at the option of the Holder, the Issuer must receive at its office or agency in the Borough of Manhattan, The City of New York, on or before the , or, if such is not a Business Day, the next succeeding Business Day, but not earlier than the prior to the on which the repayment price will be paid (i) this Note, with the form entitled "Option to Elect Repayment" below duly completed, or (ii) a telegram, telex, facsimile transmission or letter from a member of a national securities exchange or the National Association of Securities Dealers, Inc. or a commercial bank or trust company in the United States of America setting forth the name of the Holder of the Note, the principal amount of the Note, the amount of such Note to be repaid, a statement that the option to elect repayment is being made thereby and a guarantee that the Note to be repaid with the form entitled "Option to Elect Repayment" on the reverse thereof duly completed will be received by the Issuer no later than five Business Days after the date of such telegram, telex, 6 108 facsimile transmission or letter, and such Note and form duly completed are received by the Issuer by such fifth Business Day. Either form of notice duly received on or before the ___________ preceding any such shall be irrevocable. All questions as to the validity, eligibility (including time of receipt) and acceptance of any Notes for repayment will be determined by the Issuer, whose determination shall be final and binding. The -Year Extendible Notes are issuable in registered form without coupons in denominations of $ and any multiple of $ at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, and in the manner and subject to the limitations provided in the Indenture, but without the payment of any service charge, -Year Extendible Notes may be exchanged for a like aggregate principal amount of - -Year Extendible Notes of other authorized denominations. [Subject to the provisions of the Indenture, the Holder of this Note is entitled, at its option, at any time on or before __________ (except that, in case this Note or any portion hereof shall be called for redemption, such right shall terminate with respect to this Note or portion hereof, as the case may be, so called for redemption at the close of business on the date fixed for redemption as provided in the Indenture unless the Issuer defaults in making the payment due upon redemption), to convert the principal amount of this Issuer (or any portion hereof which is $1,000 or an integral multiple thereof), into fully paid and non-assessable shares (calculated as to each conversion to the nearest 1/100th of a share) of the Common Stock of the Issuer, as said shares shall be constituted at the date of conversion, at the conversion price of $_____ principal amount of Notes for each share of Common Stock, or at the adjusted conversion price in effect at the date of conversion determined as provided in the Indenture, upon surrender of this Note, together with the conversion notice hereon duly executed, to the Issuer at the designated office or agency of the Issuer in ____________________, accompanied (if so required by the Issuer) by instruments of transfer, in form satisfactory to the Issuer and to the Trustee, duly executed by the Holder or by its duly authorized attorney in writing. Such surrender shall, if made during any period beginning at the close of business on a record date and ending at the opening of business on the interest payment date next following such record date (unless this Note or the portion being converted shall have been called for redemption on a date fixed for redemption during such period), also be accompanied by payment in funds acceptable to the Issuer of an amount equal to the interest payable on such interest payment date on the principal amount of this Note then being converted. Subject to the aforesaid requirement for payment and, in the case 7 109 of a conversion after the record date next preceding any interest payment date and on or before such interest payment date, to the right of the Holder of this Note (or any predecessor security) of record at such record date to receive an installment of interest (with certain exceptions provided in the Indenture), no adjustment is to be made on conversion for interest accrued hereon or for dividends on shares of Common Stock issued on conversion. The Issuer is not required to issue fractional shares upon any such conversion, but shall make adjustment therefor in cash on the basis of the current market value of such fractional interest as provided in the Indenture. The conversion price is subject to adjustment as provided in the Indenture. In addition, the Indenture provides that in case of certain consolidations, mergers or share exchanges to which the Issuer is a party or the sale of substantially all of the assets of the Issuer, the Indenture shall be amended, without the consent of any Holders of Securities, so that this Security, if then outstanding, will be convertible thereafter, during the period this Note shall be convertible as specified above, only into the kind and amount of securities, cash and other property receivable upon the consolidation, merger, share exchange or sale by a holder of the number of shares of Common Stock into which this Note might have been converted immediately prior to such consolidation, merger, share exchange or sale (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount received per share by a plurality of non-electing shares). In the event of conversion of this Note in part only, a new Note or Notes for the unconverted portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof. The Issuer, the Trustee and any authorized agent of the Issuer or the Trustee may deem and treat the registered Holder hereof as the absolute owner of this Note (whether or not this Note shall be overdue and notwithstanding any notation of ownership or other writing hereon, for the purpose of receiving payment of, or on account of, the principal hereof and premium, if any, and subject to the provisions on the face hereof, interest hereon and for all other purposes, and neither the Issuer nor the Trustee nor any authorized agent of the Issuer or the Trustee shall be affected by any notice to the contrary. No recourse under or upon any obligation, covenant or agreement of the Issuer in the Indenture or any indenture supplemental thereto or in any -Year Extendible Note, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, officer or director, as such, of the Issuer or of any successor corporation, either directly or through the Issuer or any successor corporation, under any rule of law, statute or constitutional 8 110 provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance hereof and as part of the consideration for the issue hereof. Terms used herein which are defined in the Indenture shall have the respective meanings assigned thereto in the Indenture. 9 111 [FORM OF OPTION TO ELECT REPAYMENT] Option to Elect Repayment The undersigned hereby irrevocably requests and instructs the Issuer to repay the within Note (or portion thereof specified below) pursuant to its terms at a price equal to the principal amount thereof, together with interest to the repayment date, to the undersigned, at _______________________________________________________________________________ _______________________________________________________________________________ (Please Print or Typewrite Name and Address of the Undersigned) For this Note to be repaid the Issuer must receive at its office or agency in the Borough of Manhattan, The City and State of New York, or at such additional place or places of which the Issuer shall from time to time notify the holder of the within Note, on or before the or, if such is not a Business Day, the next succeeding Business Day, but not earlier than the prior to , , and , (i) this Note with this "Option to Elect Repayment" form duly completed or (ii) a telegram, telex, facsimile transmission or letter from a member of a national securities exchange or the National Association of Securities Dealers, Inc. or a commercial bank or a trust company in the United States of America setting forth the name of the holder of the Note, the principal amount of the Note, the amount of the Note to be repaid, a statement that the option to elect repayment is being made thereby and a guarantee that the Note to be repaid with the form entitled "Option to Elect Repayment" on the reverse of the Note duly completed will be received by the Issuer not later than five Business Days after the date of such telegram, telex, facsimile transmission or letter, and such Note and form duly completed are received by the Issuer by such fifth Business Day. If less than the entire principal amount of the within Note is to be repaid, specify the portion thereof (which shall be $ or an integral multiple of $ in excess of $ ) which the Holder elects to have repaid: $ ; and specify the denomination or denominations (which shall be $ or multiple of $ in excess of $ ) of the -Year Extendible Note or Notes to be issued to the Holder for the portion of the within Note not being repaid (in 10 112 the absence of such specification, one such Note will be issued for the portion not being repaid); $ . Dated: ______________________________________ Note: The signature to this Option to Elect Repayment must correspond with the name as written upon the face of the Note in every particular without alteration or enlargement or any other change whatsoever. 11 EX-4.4 7 INDENTURE - GUARANTEED SUBORDINATED DEBT SECUR. 1 Exhibit 4.4 ============================================================== CHUBB CAPITAL CORPORATION , Issuer AND THE CHUBB CORPORATION , Guarantor AND THE FIRST NATIONAL BANK OF CHICAGO , Trustee Indenture Dated as of __________ __, 199_ Providing for the Issuance of Subordinated Debt Securities ---------- ============================================================== 2 TABLE OF CONTENTS
Page ---- ARTICLE 1 DEFINITIONS SECTION 1.1. Certain Terms Defined . . . . . . . . . . . . . . . . . . . . . . . 1 ARTICLE 2 SECURITIES SECTION 2.1. Forms Generally . . . . . . . . . . . . . . . . . . . . . . . . . . 7 SECTION 2.2. Form of Trustee's Certificate of Authentication . . . . . . . . . . 7 SECTION 2.3. Amount Unlimited; Issuable in Series . . . . . . . . . . . . . . . 8 SECTION 2.4. Authentication and Delivery of Securities . . . . . . . . . . . . . 11 SECTION 2.5. Execution of Securities . . . . . . . . . . . . . . . . . . . . . . 12 SECTION 2.6. Certificate of Authentication . . . . . . . . . . . . . . . . . . . 12 SECTION 2.7. Denomination and Date of Securities; Payments of Interest . . . . . 13 SECTION 2.8. Registration, Transfer and Exchange . . . . . . . . . . . . . . . . 14 SECTION 2.9. Mutilated, Defaced, Destroyed, Lost and Stolen Securities . . . . . 15 SECTION 2.10. Cancellation of Securities; Destruction Thereof . . . . . . . . . . 17 SECTION 2.11. Temporary Securities . . . . . . . . . . . . . . . . . . . . . . . 17 ARTICLE 3 GUARANTEE OF DEBT SECURITIES SECTION 3.1. Unconditional Guarantee . . . . . . . . . . . . . . . . . . . . . . 18 SECTION 3.2. Execution of Guarantees . . . . . . . . . . . . . . . . . . . . . . 19 ARTICLE 4 COVENANTS OF THE ISSUER AND THE GUARANTOR SECTION 4.1. Payment of Principal and Interest . . . . . . . . . . . . . . . . . 20 SECTION 4.2. Offices for Payments, etc. . . . . . . . . . . . . . . . . . . . . 20
3
Page ---- SECTION 4.3. Appointment to Fill a Vacancy in Office of Trustee . . . . . . . . 21 SECTION 4.4. Paying Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 SECTION 4.5. Certificate of the Issuer . . . . . . . . . . . . . . . . . . . . . 22 SECTION 4.6. Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . 22 SECTION 4.7. Certificate of the Guarantor . . . . . . . . . . . . . . . . . . . 22 SECTION 4.8. Guarantor to Maintain Office or Agency . . . . . . . . . . . . . . 22 SECTION 4.9. Corporate Existence . . . . . . . . . . . . . . . . . . . . . . . . 23 ARTICLE 5 SECURITYHOLDERS' LISTS AND REPORTS BY THE ISSUER AND THE TRUSTEE SECTION 5.1. Securityholders' Lists . . . . . . . . . . . . . . . . . . . . . . 23 SECTION 5.2. Reports by the Issuer and the Guarantor . . . . . . . . . . . . . . 24 SECTION 5.3. Reports by the Trustee . . . . . . . . . . . . . . . . . . . . . . 24 ARTICLE 6 REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT SECTION 6.1. Event of Default Defined; Acceleration of Maturity; Waiver of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 SECTION 6.2. Collection of Indebtedness by Trustee; Trustee May Prove Debt . . . 27 SECTION 6.3. Application of Proceeds . . . . . . . . . . . . . . . . . . . . . . 30 SECTION 6.4. Suits for Enforcement . . . . . . . . . . . . . . . . . . . . . . . 32 SECTION 6.5. Restoration of Rights on Abandonment of Proceedings . . . . . . . . 32 SECTION 6.6. Limitations on Suits by Securityholders . . . . . . . . . . . . . . 32 SECTION 6.7. Unconditional Right of Securityholders to Institute Certain Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 SECTION 6.8. Powers and Remedies Cumulative; Delay or Omission Not Waiver of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 SECTION 6.9. Control by Securityholders . . . . . . . . . . . . . . . . . . . . 34 SECTION 6.10. Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . . . 34
ii 4
Page ---- SECTION 6.11. Trustee to Give Notice of Default, But May Withhold in Certain Circumstances . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 SECTION 6.12. Right of Court to Require Filing of Undertaking to Pay Costs . . . 35 SECTION 6.13. Waiver of Stay or Extension Laws . . . . . . . . . . . . . . . . . 36 ARTICLE 7 CONCERNING THE TRUSTEE SECTION 7.1. Duties and Responsibilities of the Trustee; During Default; Prior to Default . . . . . . . . . . . . . . . . . . . . . . . . . 36 SECTION 7.2. Certain Rights of the Trustee . . . . . . . . . . . . . . . . . . . 38 SECTION 7.3. Trustee Not Responsible for Recitals, Disposition of Securities or Application of Proceeds Thereof. . . . . . . . . . . . . . . . . 39 SECTION 7.4. Trustee and Agents May Hold Securities; Collections, etc. . . . . . 40 SECTION 7.5. Moneys Held by Trustee . . . . . . . . . . . . . . . . . . . . . . 40 SECTION 7.6. Compensation and Indemnification of Trustee and Its Prior Claim . . 40 SECTION 7.7. Right of Trustee to Rely on Officers' Certificate, etc. . . . . . 41 SECTION 7.8. Persons Eligible for Appointment as Trustee . . . . . . . . . . . . 41 SECTION 7.9. Resignation and Removal; Appointment of Successor Trustee . . . . . 41 SECTION 7.10. Acceptance of Appointment by Successor Trustee . . . . . . . . . . 43 SECTION 7.11. Merger, Conversion, Consolidation or Succession to Business of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 ARTICLE 8 CONCERNING THE SECURITYHOLDERS SECTION 8.1. Evidence of Action Taken by Securityholders . . . . . . . . . . . . 45 SECTION 8.2. Proof of Execution of Instruments and of Holding of Securities . . 46 SECTION 8.3. Holders to be Treated as Owners . . . . . . . . . . . . . . . . . . 46
iii 5
Page ---- SECTION 8.4. Securities Owned by Issuer or the Guarantor Deemed Not Outstanding. 46 SECTION 8.5. Right of Revocation of Action Taken . . . . . . . . . . . . . . . . 47 ARTICLE 9 SUPPLEMENTAL INDENTURES SECTION 9.1. Supplemental Indentures Without Consent of Securityholders . . . . 48 SECTION 9.2. Supplemental Indentures With Consent of Securityholders . . . . . . 50 SECTION 9.3. Effect of Supplemental Indenture . . . . . . . . . . . . . . . . . 52 SECTION 9.4. Documents to Be Given to Trustee . . . . . . . . . . . . . . . . . 52 SECTION 9.5. Notation on Securities in Respect of Supplemental Indentures . . . 52 SECTION 9.6 Subordination Unimpaired . . . . . . . . . . . . . . . . . . . . . 52 ARTICLE 10 CONSOLIDATION, MERGER, SALE OR CONVEYANCE SECTION 10.1. Issuer May Consolidate, etc., on Certain Terms . . . . . . . . . . 53 SECTION 10.2. Successor Corporation Substituted . . . . . . . . . . . . . . . . . 54 SECTION 10.3. Merger, Consolidation or Sale of Assets by the Guarantor . . . . . 54 SECTION 10.4. Successor Corporation to the Guarantor . . . . . . . . . . . . . . 55 SECTION 10.5. Opinion of Counsel to Trustee . . . . . . . . . . . . . . . . . . . 55 ARTICLE 11 SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS SECTION 11.1. Satisfaction and Discharge of Indenture . . . . . . . . . . . . . . 56
iv 6
Page ---- SECTION 11.2. Application by Trustee of Funds Deposited for Payment of Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57 SECTION 11.3. Repayment of Moneys Held by Paying Agent . . . . . . . . . . . . . 57 SECTION 11.4. Return of Moneys Held by Trustee and Paying Agent Unclaimed for Three Years . . . . . . . . . . . . . . . . . . . . . . . . . . 57 ARTICLE 12 MISCELLANEOUS PROVISIONS SECTION 12.1. Incorporators, Stockholders, Officers and Directors of Issuer and Guarantor Exempt from Individual Liability . . . . . . . . . . 58 SECTION 12.2. Provisions of Indenture for the Sole Benefit of Parties and Securityholders . . . . . . . . . . . . . . . . . . . . . . . . 58 SECTION 12.3. Successors and Assigns of Issuer and Guarantor Bound by Indenture . 58 SECTION 12.4. Notices and Demands on Issuer, Guarantor, Trustee and Securityholders . . . . . . . . . . . . . . . . . . . . . . . . . . 59 SECTION 12.5. Officers' Certificates and Opinions of Counsel; Statements to Be Contained Therein . . . . . . . . . . . . . . . . . . . . . . 60 SECTION 12.6. Payments Due on Saturdays, Sundays and Holidays . . . . . . . . . . 61 SECTION 12.7. Conflict of Any Provision of Indenture with Trust Indenture Act of 1939 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61 SECTION 12.8. New York Law to Govern . . . . . . . . . . . . . . . . . . . . . . 61 SECTION 12.9. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 SECTION 12.10. Effect of Headings . . . . . . . . . . . . . . . . . . . . . . . . 62 ARTICLE 13 REDEMPTION OF SECURITIES AND SINKING FUNDS SECTION 13.1. Applicability of Article . . . . . . . . . . . . . . . . . . . . . 62 SECTION 13.2. Notice of Redemption; Partial Redemptions . . . . . . . . . . . . . 62 SECTION 13.3. Payment of Securities Called for Redemption . . . . . . . . . . . . 64
v 7
Page ---- SECTION 13.4. Exclusion of Certain Securities from Eligibility for Selection for Redemption . . . . . . . . . . . . . . . . . . . . . 65 SECTION 13.5. Mandatory and Optional Sinking Funds . . . . . . . . . . . . . . . 65 ARTICLE 14 CONVERSION OF SECURITIES SECTION 14.1. Applicability of Article . . . . . . . . . . . . . . . . . . . . . 69 SECTION 14.2. Exercise of Conversion Privilege . . . . . . . . . . . . . . . . . 69 SECTION 14.3. No Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . 70 SECTION 14.4. Adjustment of Conversion Price . . . . . . . . . . . . . . . . . . 71 SECTION 14.5. Notice of Certain Corporate Actions . . . . . . . . . . . . . . . . 75 SECTION 14.6. Reservation of Shares of Common Stock . . . . . . . . . . . . . . . 77 SECTION 14.7. Payment of Certain Taxes Upon Conversion . . . . . . . . . . . . . 77 SECTION 14.8. Nonassessability . . . . . . . . . . . . . . . . . . . . . . . . . 77 SECTION 14.9. Effect of Consolidation or Merger on Conversion Privilege . . . . . 77 SECTION 14.10. Duties of Trustee Regarding Conversion . . . . . . . . . . . . . . 79 SECTION 14.11. Repayment of Certain Funds Upon Conversion . . . . . . . . . . . . 79 ARTICLE 15 SUBORDINATION OF SECURITIES SECTION 15.1. Subordination of the Securities . . . . . . . . . . . . . . . . . . 80 SECTION 15.2. No Payment on Securities in Event of Default on Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . 80 SECTION 15.3. Distribution on Dissolution, Liquidation and Reorganization of the Issuer . . . . . . . . . . . . . . . . . . . . . . . . . . . 81 SECTION 15.4. Payment to Holders of Senior Indebtedness . . . . . . . . . . . . . 82 SECTION 15.5. Subrogation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83 SECTION 15.6. Payment on Securities Permitted . . . . . . . . . . . . . . . . . . 84 SECTION 15.7. Authorization of Holders to Trustee to Effect Subordination . . . . 85
vi 8
Page ---- SECTION 15.8. Trustee as Holder of Senior Indebtedness . . . . . . . . . . . . . 85 SECTION 15.9. Notices to Trustee . . . . . . . . . . . . . . . . . . . . . . . . 85 SECTION 15.10. No Fiduciary Duty by Trustee to Holders of Senior Indebtedness . . 85 TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106 SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106 ACKNOWLEDGEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
vii 9 THIS INDENTURE, dated as of _________ __, 199_ among Chubb Capital Corporation, a New Jersey corporation (the "Issuer"), The First National Bank of Chicago, a national banking association (the "Trustee"), and The Chubb Corporation, a New Jersey corporation (the "Guarantor"), W I T N E S S E T H: WHEREAS, the Issuer has duly authorized the issue from time to time of its unsecured, subordinated debentures, notes or other evidences of indebtedness to be issued in one or more series (the "Securities") up to such principal amount or amounts as may from time to time be authorized in accordance with the terms of this Indenture and to provide, among other things, for the authentication, delivery and administration thereof, the Issuer has duly authorized the execution and delivery of this Indenture; and WHEREAS, the Guarantor desires to make the Guarantees (as hereinof defined) as provided herein and has duly authorized the execution and delivery of this Indenture; and WHEREAS, all things necessary to make this Indenture a valid indenture and agreement according to its terms have been done; NOW, THEREFORE: In consideration of the premises and the purchases of the Securities by the holders thereof, the Issuer and the Guarantor covenant and agree with each other and with the Trustee for the equal and proportionate benefit of the respective holders from time to time of the Securities as follows: ARTICLE 1 DEFINITIONS SECTION 1.1. CERTAIN TERMS DEFINED. The following terms (except as otherwise expressly provided or unless the context otherwise clearly requires) for all purposes of this Indenture and of any indenture supplemental hereto shall have the respective meanings specified in this Section. All other terms used in this Indenture that are 10 defined in the Trust Indenture Act of 1939 or the definitions of which in the Securities Act of 1933 are referred to in the Trust Indenture Act of 1939, including terms defined therein by reference to the Securities Act of 1933 (the "Securities Act") (except as herein otherwise expressly provided or unless the context otherwise clearly requires), shall have the meanings assigned to such terms in said Trust Indenture Act and in said Securities Act as in force at the date of this Indenture. All accounting terms used herein and not expressly defined shall have the meanings assigned to such terms in accordance with generally accepted accounting principles, and the term "generally accepted accounting principles" means such accounting principles as are generally accepted at the time of any computation. 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. The terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular. "BOARD OF DIRECTORS" means either the Board of Directors of the Issuer or the Guarantor, as the case may be, or any committee of either such Board duly authorized to act hereunder. "BOARD RESOLUTION" means a copy of one or more resolutions, certified by the Secretary or an Assistant Secretary of the Issuer or the Guarantor, as the case may be, to have been duly adopted or consented to by the Board of Directors of the Issuer or by the Board of Directors of the Guarantor, as the case may be, and to be in full force and effect, and delivered to the Trustee. "BUSINESS DAY" means, with respect to any Security, a day that in Chicago, Illinois or in the city (or in any of the cities, if more than one) in which amounts are payable, as specified in the form of such Security, is not a day on which banking institutions are authorized by law or regulation to close. "CASH TRANSACTION" means any transaction in which full payment for goods or securities sold is made within seven days after delivery of the goods or securities in currency or in checks or other orders drawn upon banks or bankers and payable upon demand. "COMMISSION" means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, or if at any time after the execution and delivery of this Indenture such Commission 2 11 is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties on such date. "COMMON STOCK" means shares of common stock, par value $1.00 per share, of the Guarantor. "CONVERSION PRICE" means the amount of Common Stock issuable upon conversion of any Securities and, in the case of any specific series of Securities, may be expressed in terms of either a conversion price or a conversion rate. "EVENT OF DEFAULT" means any event or condition specified as such in Section 6.1. "GUARANTEES" means the guarantees of the Guarantor to be endorsed on the Securities authenticated and delivered hereunder. "GUARANTOR" means The Chubb Corporation, a New Jersey corporation, and, subject to Article Ten, its successors and assigns. "HOLDER", "HOLDER OF SECURITIES", "SECURITYHOLDER" or other similar terms mean the registered holder of any Security. "INDENTURE" means this instrument as originally executed and delivered or, if amended or supplemented as herein provided, as so amended or supplemented or both, and shall include the forms and terms of particular series of Securities established as contemplated hereunder. "INTEREST" means, when used with respect to non-interest bearing Securities, interest payable after maturity. "ISSUER" means (except as otherwise provided in Article Seven) the Chubb Capital Corporation, a New Jersey corporation, and, subject to Article Ten, its successors and assigns. "ISSUER ORDER" means a written statement, request or order of the Issuer or the Guarantor, as the case may be, signed in its name by the Chairman, Vice Chairman, the President, any Vice President or the Treasurer of the Issuer or the Guarantor, as the case may be. "OFFICERS' CERTIFICATE" means a certificate signed by the Chairman, the Vice Chairman, the President or any Vice President and by the Treasurer or the Secretary or any 3 12 Assistant Secretary of the Issuer or the Guarantor, as the context requires, and, in either case, delivered to the Trustee. Each such certificate shall comply with Section 314 of the Trust Indenture Act of 1939 and include the statements provided for in Section 12.5. "OPINION OF COUNSEL" means an opinion in writing signed by legal counsel who may be an employee of or counsel to the Issuer or the Guarantor and who shall be satisfactory to the Trustee. Each such opinion shall comply with Section 314 of the Trust Indenture Act of 1939 and include the statements provided for in Section 12.5, if and to the extent required hereby. "ORIGINAL ISSUE DATE" of any Security (or portion thereof) means the earlier of (a) the date of such Security or (b) the date of any Security (or portion thereof) for which such Security was issued (directly or indirectly) on registration of transfer, exchange or substitution. "ORIGINAL ISSUE DISCOUNT SECURITY" means any Security that provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the maturity thereof pursuant to Section 6.1. "OUTSTANDING", when used with reference to Securities, shall, subject to the provisions of Section 8.4, mean, as of any particular time, all Securities authenticated and delivered by the Trustee under this Indenture, except (a) Securities theretofore canceled by the Trustee or delivered to the Trustee for cancellation; (b) Securities, or portions thereof, for the payment or redemption of which moneys in the necessary amount shall have been deposited in trust with the Trustee or with any paying agent (other than the Issuer) or shall have been set aside, segregated and held in trust by the Issuer for the holders of such Securities (if the Issuer shall act as its own paying agent), provided that if such Securities, or portions thereof, are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given as herein provided, or provision satisfactory to the Trustee shall have been made for giving such notice; and (c) Securities in substitution for which other Securities shall have been authenticated and delivered, or which shall have been paid, pursuant to the terms of Section 2.9 (except with respect to any such Security as to which 4 13 proof satisfactory to the Trustee is presented that such Security is held by a person in whose hands such Security is a legal, valid and binding obligation of the Issuer). In determining whether the holders of the requisite principal amount of Outstanding Securities of any or all series have given any request, demand, authorization, direction, notice, consent or waiver hereunder, (i) the principal amount of an Original Issue Discount Security that shall be deemed to be Outstanding for such purposes shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon a declaration of acceleration of the maturity thereof pursuant to Section 6.1 and (ii) the principal amount of any Security denominated in a foreign currency or currencies shall be the U.S. dollar equivalent, determined on the original issue date of such Security, of the principal amount (or, in the case of an Original Issue Discount Security, The U.S. dollar equivalent on the original issue date of such Security of the amount determined as provided for in (i) above) for such Security. "PERIODIC OFFERING" means an offering of Securities of a series from time to time, the specific terms of which Securities, including, without limitation, the rate or rates of interest, if any, thereon, the stated maturity or maturities thereof and the redemption provisions, if any, with respect thereto, are to be determined by the Issuer or its agents upon the issuance of such Securities pursuant to Section 2.3. "PERSON" means any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. "PRINCIPAL", whenever used with reference to the Securities or any Security or any portion thereof, shall be deemed to include "and premium, if any". "RESPONSIBLE OFFICER", when used with respect to the Trustee, means the Chairman of the Board of Directors, any Vice Chairman of the Board of Directors, the Chairman of the Trust Committee, the Chairman of the Executive Committee, any Vice Chairman of the Executive Committee, the President, any Vice President, the Cashier, the Secretary, the Treasurer, any Trust Officer, any Assistant Trust Officer, any Assistant Vice President, any Assistant Cashier, any Assistant Secretary, any Assistant Treasurer, or any other officer or assistant officer of the Trustee customarily performing functions similar to those performed 5 14 by the persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of his knowledge of and familiarity with the particular subject. "SECURITY" or "SECURITIES" has the meaning stated in the first recital of this Indenture, or, as the case may be, Securities that have been authenticated and delivered under this Indenture. "SELF-LIQUIDATING PAPER" means any draft, bill of exchange, acceptance or obligation which is made, drawn, negotiated or incurred by the Issuer for the purpose of financing the purchase, processing, manufacture, shipment, storage or sale of goods, wares or merchandise and which is secured by documents evidencing title to, possession of, or a lien upon the goods, wares or merchandise or the receivables or proceeds arising from the sale of the goods, wares or merchandise previously constituting the security, provided the security is received by the Trustee simultaneously with the creation of the creditor relationship with the Issuer arising from the making, drawing, negotiating or incurring of the draft, bill of exchange, acceptance or obligation. "SENIOR INDEBTEDNESS" shall have the meaning given to that term in Section 15.1. "TRUSTEE" means the Person identified as "Trustee" in the first paragraph hereof and, subject to the provisions of Article Seven, shall also include any successor trustee. "TRUST INDENTURE ACT OF 1939" means the Trust Indenture Act of 1939, as amended, as in force at the date as of which this Indenture was originally executed. "VICE PRESIDENT", when used with respect to the Issuer or the Trustee, means any vice president, whether or not designated by a number or a word or words added before or after the title of "Vice President". "YIELD TO MATURITY" means the yield to maturity on a series of securities, calculated at the time of issuance of such series, or, if applicable, at the most recent redetermination of interest on such series, and calculated in accordance with accepted financial practice. 6 15 ARTICLE 2 SECURITIES SECTION 2.1. FORMS GENERALLY. The Securities of each series shall be substantially in such form (not inconsistent with this Indenture) as shall be established by or pursuant to a Board Resolution (as set forth in the Board Resolution or, to the extent established pursuant to rather than set forth in the Board Resolution, an Officers' Certificate detailing such establishment) or in one or more indentures supplemental hereto, in each case with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture and may have imprinted or otherwise reproduced thereon such legend or legends, not inconsistent with the provisions of this Indenture, as may be required to comply with any law or with any rules or regulations pursuant thereto, or with any rules of any securities exchange or to conform to general usage, all as may be determined by the officers executing such Securities, as evidenced by their execution of the Securities. The definitive Securities shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all as determined by the officers executing such Securities, as evidenced by their execution of such Securities. The Guarantees to be endorsed on the Securities of each series shall be in substantially the form set forth in Section 3.1, or as shall be established by or pursuant to one or more Board Resolutions of the Guarantor (as set forth in a Board Resolution or, to the extent established pursuant to rather than set forth in a Board Resolution, an Officers' Certificate of the Guarantor detailing such establishment) or in one or more indentures supplemental hereto, in each case with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with any law or with any rules made pursuant thereto or with any rules of any securities exchange or to conform to general usage or as may, consistently herewith, be determined by the officers executing such Guarantees, as evidenced by their execution of such Guarantees. SECTION 2.2. FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION. The Trustee's certificate of authentication 7 16 on all Securities shall be in substantially the following form: This is one of the Securities of the series designated herein and referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By ------------------------------------- Authorized Officer SECTION 2.3. 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 of the Board of Directors of the Issuer and the Board of Directors of the Guarantor, as the case may be, and set forth in such Board Resolutions or to the extent established pursuant to (rather than set forth in) such Board Resolutions in an Officers' Certificate of the Issuer or an Officers' Certificate of the Guarantor, as the case may be, detailing such establishment, or established in one or more indentures supplemental hereto, prior to the initial issuance of Securities of any series, (a) the title of the Securities of the series (which shall distinguish the Securities of the series from all other Securities); (b) any limit upon the aggregate principal amount of the Securities of the series that 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 2.8, 2.9, 2.11, 9.5 or 13.3); (c) the date or dates on which the principal of the Securities of the series is payable; (d) the rate or rates at which the Securities of the series shall bear interest, if any, or the method by which such rate shall be determined, the date or dates from which such interest shall accrue, the interest payment dates 8 17 on which such interest shall be payable and the record dates for the determination of Holders to whom interest is payable; (e) the place or places where the principal of and any interest on Securities of the series shall be payable (if other than as provided in Section 4.2); (f) the price or prices at which, the period or periods within which and the terms and conditions upon which Securities of the series may be redeemed, in whole or in part, at the option of the Issuer, pursuant to any sinking fund or otherwise; (g) the obligation, if any, of the Issuer to redeem, purchase or repay Securities of the series pursuant to any mandatory redemption, sinking fund or analogous provisions or at the option of a Holder thereof and the price or prices at which and the period or periods within which and the terms and conditions upon which Securities of the series shall be redeemed, purchased or repaid, in whole or in part, pursuant to such obligation; (h) if other than as set forth in Article Fourteen, the terms of any right to convert Securities of the series into shares of Common Stock of the Guarantor or other securities or property; (i) if other than denominations of $1,000 and any integral multiple thereof, the denominations in which Securities of the series shall be issuable; (j) if other than the principal amount thereof, the portion of the principal amount of Securities of the series which shall be payable upon declaration of acceleration of the maturity thereof pursuant to Section 6.1 or provable in bankruptcy pursuant to Section 6.2; (k) if other than as set forth in Section 6.1, any Event of Default with respect to the Securities of the series, if not set forth herein; (l) the Guarantees of the Debt Securities of such series pursuant to Article Three hereof; (m) any other terms of the series (which terms shall not be inconsistent with the provisions of this Indenture); 9 18 (n) any trustees, authenticating or paying agents, transfer agents or registrars or any other agents with respect to the Securities of such series; (o) if other than the coin or currency in which the Securities of that series are denominated, the coin or currency in which payment of the principal of or interest on the Securities of such series shall be payable; (p) if the principal of or interest on the Securities of such series are to be payable, at the election of the Issuer or a Holder thereof, in a coin or currency other than that in which the Securities are denominated, the period or periods within which, and the terms and conditions upon which, such election may be made; (q) if the amount of payments of principal of and interest on the Securities of the series may be determined with reference to an index, the manner in which such amounts shall be determined; (r) whether and under what circumstances the Issuer will pay additional amounts on the Securities of the series held by a person who is not a U.S. person in respect of any tax, assessment or governmental charge withheld or deducted and, if so, whether the Issuer will have the option to redeem such Securities rather than pay such additional amounts; (s) if the Securities of such series are to be issuable in definitive form (whether upon original issue or upon exchange of a temporary Security of such series) only upon receipt of certain certificates or other documents or satisfaction of other conditions, the form and terms of such certificates, documents or conditions; and (t) any other affirmative or negative covenants with respect to the Securities of such 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 or Officers' Certificates referred to above or as set forth in any such indenture supplemental hereto. All Securities of any one series need not be issued at the same time and may be issued from time to time, consistent with the terms of the Indenture, if so provided by or pursuant to such Board Resolution, such Officers' Certificates or in any such indenture supplemental hereto. 10 19 SECTION 2.4. AUTHENTICATION AND DELIVERY OF SECURITIES. At any time and from time to time after the execution and delivery of this Indenture, the Issuer may deliver Securities of any series executed by the Issuer and having endorsed thereon the Guarantees executed by the Guarantor to the Trustee for authentication together with the applicable documents referred to below in this Section, and the Trustee shall thereupon authenticate and deliver such Securities to or upon the order of the Issuer (contained in the Issuer Order referred to below in this Section) or pursuant to such procedures acceptable to the Trustee as may be specified from time to time by an Issuer Order. The maturity date, original issue date, interest rate and any other terms of the Securities of such series may be determined by or pursuant to such Issuer Order and procedures. Such Issuer Order may authorize authentication and delivery pursuant to oral instructions from the Issuer or its duly authorized agent, which instructions shall be promptly confirmed in writing. In authenticating such Securities and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, before the first authentication of Securities of such series, and (subject to Section 7.1) shall be fully protected in relying upon: (a) an Issuer Order requesting such authentication and setting forth delivery instructions if the Securities are not to be delivered to the Issuer, provided that, with respect to Securities of a series subject to a Periodic Offering, such Issuer Order may provide procedures acceptable to the Trustee for the completion of authentication and delivery of securities from time to time pursuant to oral or electronic instructions from the Issuer or its duly authorized agent or agents, which oral instructions shall be promptly confirmed in writing; (b) any Board Resolution, Officers' Certificate or executed supplemental indenture referred to in Sections 2.1 and 2.3 by or pursuant to which the forms and terms of the Securities and the Guarantees to be endorsed on such Securities were established; (c) an Opinion of Counsel, prepared in accordance with Section 12.5, which shall state (i) that the form or forms and terms of such Securities have been, or will be when any conditions specified in such Opinion of Counsel are satisfied, duly authorized by the Issuer and established in conformity with the provisions of this Indenture; and 11 20 (ii) that such Securities, when authenticated and delivered by the Trustee and issued by the Issuer in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and binding obligations of the Issuer and that the Guarantees endorsed on Securities, when executed by the Guarantor, will constitute valid and binding obligations of the Guarantor. The Trustee shall have the right to decline to authenticate and deliver any Securities under this Section if the Trustee, being advised by counsel, determines that such action may not lawfully be taken by the Issuer or the Guarantor or if the Trustee in good faith by its Board of Directors or Board of Trustees, Executive Committee, or a Trust Committee of Directors or Trustees or Responsible Officers shall determine that such action would expose the Trustee to personal liability to existing Holders. SECTION 2.5. EXECUTION OF SECURITIES. The Securities shall be signed on behalf of the Issuer by both (a) its Chairman or its Vice Chairman or its President or any Vice President and (b) by its Treasurer or its Secretary or any Assistant Secretary, under its corporate seal which may, but need not, be attested. Such signatures may be the manual or facsimile signatures of the present or any future such officers. The seal of the Issuer may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Securities. Typographical and other minor errors or defects in any such reproduction of the seal or any such signature shall not affect the validity or enforceability of any Security that has been duly authenticated and delivered by the Trustee. In case any officer of the Issuer who shall have signed any of the Securities shall cease to be such officer before the Security so signed shall be authenticated and delivered by the Trustee or disposed of by the Issuer, such Security nevertheless may be authenticated and delivered or disposed of as though the person who signed such Security had not ceased to be such officer of the Issuer; and any Security may be signed on behalf of the Issuer by such persons as, at the actual date of the execution of such Security, shall be the proper officers of the Issuer, although at the date of the execution and delivery of this Indenture any such person was not such an officer. SECTION 2.6. CERTIFICATE OF AUTHENTICATION. Only such Securities as shall bear thereon a certificate of authentication substantially in the form hereinbefore recited, executed by the Trustee by the manual signature of 12 21 one of its authorized officers, shall be entitled to the benefits of this Indenture or be valid or obligatory for any purpose. No Guarantee shall be or become valid or obligatory for any purpose until such certificate by the Trustee shall have been duly executed on the Security on which such Guarantee is endorsed. Such certificate by the Trustee upon any Security executed by the Issuer shall be conclusive evidence that the Security so authenticated has been duly authenticated and delivered hereunder and that the holder is entitled to the benefits of this Indenture. SECTION 2.7. DENOMINATION AND DATE OF SECURITIES; PAYMENTS OF INTEREST. The Securities of each series shall be issuable as registered securities without coupons and in denominations as shall be specified as contemplated by Section 2.3. In the absence of any such specification with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $1,000 and any multiple thereof. The Securities of each series shall be numbered, lettered, or otherwise distinguished in such manner or in accordance with such plan as the officers of the Issuer executing the same may determine with the approval of the Trustee as evidenced by the execution and authentication thereof. Each Security shall be dated the date of its authentication, and shall bear interest, if any, from the date and shall be payable on the dates, in each case, which shall be specified as contemplated by Section 2.3. The person in whose name any Security of any series is registered at the close of business on any record date applicable to a particular series with respect to any interest payment date for such series shall be entitled to receive the interest, if any, payable on such interest payment date notwithstanding any transfer or exchange of such Security subsequent to the record date and prior to such interest payment date, except if and to the extent the Issuer and Guarantor shall default in the payment of the interest due on such interest payment date for such series, in which case such defaulted interest shall then cease to be payable to the Holder on such record date by virtue of having been such Holder and shall be paid to the persons in whose names Outstanding Securities for such series are registered at the close of business on a subsequent record date (which shall be not less than five Business Days prior to the date of payment of such defaulted interest) established by notice given by mail by or on behalf of the Issuer to the holders of Securities not less than 15 days preceding such subsequent record date. The term "record date" as used with respect to any interest payment date 13 22 (except a date for payment of defaulted interest) shall mean the date specified as such in the terms of the Securities of any particular series, or, if no such date is so specified, if such interest payment date is the first day of a calendar month, the fifteenth day of the next preceding calendar month or, if such interest payment date is the fifteenth day of a calendar month, the first day of such calendar month, whether or not such record date is a Business Day. Subject to the provisions of Section 14.2, in the case of any Security which is converted after any applicable record date with respect to any interest payment date and on or prior to the next succeeding interest payment date (other than any Security the principal of (or premium, if any, on) which shall become due and payable, whether at final maturity or by declaration of acceleration, call for redemption, or otherwise prior to such next succeeding interest payment date), interest whose final maturity is on such interest payment date shall be payable on such interest payment date notwithstanding such conversion and such interest (whether or not punctually paid or duly provided for) shall be paid to the person in whose name that Security (or any one or more predecessor Securities) is registered at the close of business on such record date. Except as otherwise expressly provided in the immediately preceding sentence, in the case of any Security which is converted, interest whose final maturity is after the date of conversion of such Security shall not be payable. SECTION 2.8. REGISTRATION, TRANSFER AND EXCHANGE. The Issuer will keep at each office or agency to be maintained for the purpose as provided in Section 4.2 for each series of securities a register or registers in which, subject to such reasonable regulations as it may prescribe, it will register, and will register the transfer of, Securities of such series as in this Article provided. Such register shall be in written form in the English language or in any other form capable of being converted into such form within a reasonable time. At all reasonable times such register or registers shall be open for inspection by the Trustee. Upon due presentation for registration of transfer of any Security of any series at any such office or agency to be maintained for the purpose as provided in Section 4.2, the Issuer shall execute and the Trustee shall authenticate and deliver in the name of the transferee or transferees a new Security or Securities of like tenor and aggregate principal amount. 14 23 Any Security or Securities of any series may be exchanged for a Security or Securities of the same series in other authorized denominations, of like tenor and in an equal aggregate principal amount. Securities of any series to be exchanged shall be surrendered at any office or agency to be maintained by the Issuer for the purpose as provided in Section 4.2, and the Issuer shall execute and the Trustee shall authenticate and deliver in exchange therefor the Security or Securities of the same series which the Securityholder making the exchange shall be entitled to receive, bearing numbers not contemporaneously outstanding. All Securities presented for registration of transfer, exchange, redemption or payment shall (if so required by the Issuer or the Trustee) be duly endorsed by, or be accompanied by a written instrument or instruments of transfer in form satisfactory to the Issuer and the Trustee duly executed by, the Holder or the Holder's attorney duly authorized in writing. The Issuer may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any exchange or registration of transfer of Securities. No service charge shall be made for any such transaction. The Issuer shall not be required to exchange or register a transfer of (a) any Securities of any series for a period of 15 days next preceding the first mailing of notice of redemption of Securities of such series to be redeemed, or (b) any Securities selected, called or being called for redemption, in whole or in part, except, in the case of any Security where public notice has been given that such Security is to be redeemed in part, the portion thereof not so to be redeemed. All Securities issued upon any transfer or exchange of Securities shall have a Guarantee or Guarantees endorsed thereon and shall be valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such transfer or exchange. SECTION 2.9. MUTILATED, DEFACED, DESTROYED, LOST AND STOLEN SECURITIES. In case any temporary or definitive Security shall become mutilated, defaced or be destroyed, lost or stolen, the Issuer in its discretion may execute, and upon the written request of any officer of the Issuer, the Trustee shall authenticate and deliver, a new Security of the same series and tenor, bearing a number not contemporaneously outstanding, in exchange and substitution 15 24 for the mutilated or defaced Security, or in lieu of and substitution for the Security so destroyed, lost or stolen. In every case the applicant for a substitute Security shall furnish to the Issuer, to the Guarantor and to the Trustee and any agent of them such security or indemnity as may be required by them to indemnify and defend and to save each of them harmless and, in every case of destruction, loss or theft, evidence to their satisfaction of the destruction, loss or theft of such Security and of the ownership thereof and in the case of mutilation or defacement shall surrender such Security to the Trustee. Upon the issuance of any substitute Security, the Issuer 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. In case any Security which has matured or is about to mature or has been called for redemption in full shall become mutilated or defaced or be destroyed, lost or stolen, the Issuer may instead of issuing a substitute Security, pay or authorize the payment of the same (without surrender thereof except in the case of a mutilated or defaced Security), if the applicant for such payment shall furnish to the Issuer, to the Guarantor and to the Trustee and any agent of them such security or indemnity as any of them may require to save each of them harmless, and, in every case of destruction, loss or theft, the applicant shall also furnish to the Issuer, to the Guarantor and the Trustee and any agent of the Issuer, the Guarantor or the Trustee evidence to their satisfaction of the destruction, loss or theft of such Security and of the ownership thereof. Every substitute Security of any series issued pursuant to the provisions of this Section by virtue of the fact that any such Security is destroyed, lost or stolen shall constitute an additional contractual obligation of the Issuer containing the Guarantees as herein provided, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of (but shall be subject to all the limitations of rights set forth in) this Indenture equally and proportionately with any and all other Securities of such series duly authenticated and delivered hereunder. All Securities shall be held and owned upon the express condition that, to the extent permitted by law, the foregoing provisions are exclusive with respect to the replacement or payment of mutilated, defaced or destroyed, lost or stolen Securities and shall preclude any and all other rights or remedies notwithstanding any law or statute existing or hereafter enacted to the contrary with respect 16 25 to the replacement or payment of negotiable instruments or other securities without their surrender. SECTION 2.10. CANCELLATION OF SECURITIES; DESTRUCTION THEREOF. All Securities surrendered for payment, redemption, registration of transfer or exchange, or for credit against any payment in respect of a sinking or analogous fund, or for conversion, if surrendered to the Issuer or the Guarantor or any agent of the Issuer or any agent of the Guarantor or the Trustee, shall be delivered to the Trustee for cancellation or, if surrendered to the Trustee, shall be canceled by it; and no Securities shall be issued in lieu thereof except as expressly permitted by any of the provisions of this Indenture. The Trustee shall destroy canceled Securities held by it and deliver a certificate of destruction to the Issuer. If the Issuer or the Guarantor shall acquire any of the Securities, such acquisition shall not operate as a redemption or satisfaction of the indebtedness represented by such Securities unless and until the same are delivered to the Trustee for cancellation. SECTION 2.11. TEMPORARY SECURITIES. Pending the preparation of definitive Securities for any series, the Issuer may execute and the Trustee shall authenticate and deliver temporary Securities for such series (printed, lithographed, typewritten or otherwise reproduced, in each case in form satisfactory to the Trustee). Temporary Securities of any series shall be issuable as registered Securities without coupons, of any authorized denomination, and substantially in the form of the definitive Securities of such series but with such omissions, insertions and variations as may be appropriate for temporary Securities, all as may be determined by the Issuer with the concurrence of the Trustee as evidenced by the execution and authentication thereof. Temporary Securities may contain such reference to any provisions of this Indenture as may be appropriate. Every temporary Security shall be executed by the Issuer, have endorsed thereon the Guarantees executed by the Guarantor, which shall be substantially of the tenor and substantially in the form of the definitive Guarantees, and be authenticated by the Trustee upon the same conditions and in substantially the same manner, and with like effect, as the definitive Securities. Without unreasonable delay the Issuer shall execute and shall furnish definitive Securities of such series having endorsed thereon the Guarantees executed by the Guarantor and thereupon temporary Securities of such series may be surrendered in exchange therefor without charge at each office or agency to be maintained by the Issuer for that purpose pursuant to Section 4.2, and the Trustee shall authenticate and deliver in exchange for such 17 26 temporary Securities of such series 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 be entitled to the same benefits under this Indenture as definitive Securities of such series. ARTICLE 3 GUARANTEE OF DEBT SECURITIES SECTION 3.1. UNCONDITIONAL GUARANTEE. The Guarantor hereby unconditionally guarantees to each holder of a Security of each series authenticated and delivered by the Trustee, the due and punctual payment of the principal of (including any amount in respect of original issue discount), and interest, if any (together with any additional amounts payable pursuant to the terms of such Security), on such Security and the due and punctual payment of the sinking fund payments, if any, and analogous obligations, if any, and the conversion rights, if any, provided for pursuant to the terms of such Security, when and as the same shall become due and payable or convertible, whether at maturity or upon redemption or upon declaration of acceleration or otherwise according to the terms of such Security and of this Indenture. In case of default by the Issuer in the payment of any such principal (including any amount in respect of original issue discount), interest (together with any additional amounts payable pursuant to the terms of such Security), sinking fund payment, or analogous obligation, or in the compliance with any conversion rights the Guarantor agrees duly and punctually to pay or convert, as applicable, the same. The Guarantor hereby agrees that its obligations hereunder shall be absolute and unconditional irrespective of any extension of the time for payment of any such Security, any modification of any such Security, any invalidity, irregularity or unenforceability of any such Security or this Indenture, any failure to enforce the same or any waiver, modification or indulgence granted to the Issuer with respect thereto by the holder of such Security or the Trustee, or any other circumstances which may otherwise constitute a legal or equitable discharge of a surety or guarantor. The Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of merger or bankruptcy of the Issuer, any right to require a demand or proceeding first against the Issuer, protest or notice with respect to any such Security or the indebtedness evidenced thereby and all demands whatsoever, and covenants that this guarantee will not be discharged as to any such Security 18 27 except by payment in full of the principal of (including any amount payable in respect of original issue discount), and interest, if any (together with any additional amounts payable pursuant to the terms of such Security), thereon or conversion thereof. The Guarantor irrevocably waives any and all rights to which it may be entitled, by operation of law or otherwise, upon making any payment hereunder (i) to be subrogated to the rights of a Holder against the Issuer with respect to such payment or otherwise to be reimbursed, indemnified or exonerated by the Issuer in respect thereof or (ii) to receive any payment, in the nature of contribution or for any other reason, from any other obligor with respect to such payment. The guarantee set forth in this Section shall not be valid or become obligatory for any purpose with respect to a Security of any series until the certificate of authentication on such Security shall have been signed by the Trustee. SECTION 3.2. EXECUTION OF GUARANTEES. To evidence its guarantee specified in Section 3.1 to the holders of Securities of any series, the Guarantor hereby agrees to execute the Guarantees in substantially the form above recited to be endorsed on each Security of such series authenticated and delivered by the Trustee. Such Guarantees shall be executed on behalf of the Guarantor by both (a) its Chairman or its Vice Chairman or its President or any Vice President and (b) its Treasurer or any Assistant Treasurer or its Secretary or any Assistant Secretary, under its corporate seal which may, but need not, be attested, prior to the authentication of the Security on which it is endorsed, and the delivery of such Security by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of such Guarantees on behalf of the Guarantor. The seal of the Guarantor may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Guarantees. Typographical and other minor errors or defects in any such reproduction of the seal or any such signature shall not affect the validity or enforceability of any Guarantee that has been duly authenticated and delivered by the Trustee. Such signatures may be the manual or facsimile signatures of such officers and may be imprinted or otherwise reproduced on the Guarantees. In case any officer of the Guarantor who shall have signed any of the Guarantees shall cease to be an officer before the Security on which such Guarantees are endorsed shall have been authenticated 19 28 and delivered by the Trustee or disposed of by the Issuer, such Security nevertheless may be authenticated and delivered or disposed of as though the person who signed such Guarantees had not ceased to be such officer, and any Guarantees may be signed on behalf of the Guarantor by such persons as, at the actual date of the execution of such Guarantees, shall be the proper officers of the Guarantor, although at the date of such Security or of the execution of this Indenture any such person was not such an officer. ARTICLE 4 COVENANTS OF THE ISSUER AND THE GUARANTOR As To The Issuer: SECTION 4.1. PAYMENT OF PRINCIPAL AND INTEREST. The Issuer covenants and agrees for the benefit of each series of Securities that it will duly and punctually pay or cause to be paid the principal of, and interest on, each of the Securities of such series at the place or places, at the respective times and in the manner provided in such Securities and this Indenture. Each installment of interest on the Securities of any series may be paid by mailing checks for such interest payable to or upon the written order of the holders of Securities entitled thereto as they shall appear on the registry books of the Issuer. SECTION 4.2. OFFICES FOR PAYMENTS, ETC. So long as any of the Securities remain outstanding, the Issuer will maintain in the Borough of Manhattan, the City of New York, the following for each series: an office or agency (a) where the Securities may be presented for payment, (b) where the Securities may be presented for registration of transfer and for exchange as in this Indenture provided and (c) where notices and demands to or upon the Issuer in respect of the Securities or of this Indenture may be served. The Issuer will give to the Trustee written notice of the location of any such office or agency and of any change of location thereof. Unless otherwise specified in accordance with Section 2.3, the Issuer hereby initially designates the corporate trust office of The First National Bank of Chicago, 14 Wall Street, Eighth Floor, New York, New York 10005 (the "Corporate Trust Office"), as the office to be maintained by it for each such purpose in the Borough of Manhattan, the City of New York. In case the Issuer shall fail to so designate or maintain any such office or agency or shall fail to give such notice of the location or of any change in the location thereof, presentations, surrenders 20 29 and demands may be made and notices may be served at the Corporate Trust Office. SECTION 4.3. APPOINTMENT TO FILL A VACANCY IN OFFICE OF TRUSTEE. The Issuer, whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, in the manner provided in Section 7.9, a Trustee, so that there shall at all times be a Trustee with respect to each series of Securities hereunder. SECTION 4.4. PAYING AGENTS. Whenever the Issuer shall appoint a paying agent other than the Trustee with respect to the Securities of any series, it will cause such paying agent to execute and deliver to the Trustee an instrument in which such agent shall agree with the Trustee, subject to the provisions of this Section, (a) that it will hold all sums received by it as such agent for the payment of the principal of or interest on the Securities of such series (whether such sums have been paid to it by the Issuer or by any other obligor on the Securities of such series) in trust for the benefit of the holders of the Securities of such series or of the Trustee; (b) that it will give the Trustee notice of any failure by the Issuer (or by any other obligor on the Securities of such series) to make any payment of the principal of or interest on the Securities of such series when the same shall be due and payable; and (c) at any time during the continuance of any such default, upon written request of the Trustee, forthwith to pay to the Trustee all sums so held in trust by the paying agent. The Issuer will, on or prior to each due date of the principal of or interest on the Securities of such series, deposit with the paying agent a sum sufficient to pay such principal or interest so becoming due, and (unless such paying agent is the Trustee) the Issuer will promptly notify the Trustee of any failure to take such action. If the Issuer shall act as its own paying agent with respect to the Securities of any series, it will, on or before each due date of the principal of or interest on the Securities of such series, set aside, segregate and hold in trust for the benefit of the holders of the Securities of such series a sum sufficient to pay such principal or interest so becoming due. The Issuer will promptly notify the Trustee of any failure to take such action. 21 30 Anything in this Section to the contrary notwithstanding, the Issuer may at any time, for the purpose of obtaining a satisfaction and discharge with respect to one or more or all series of Securities hereunder, or for any other reason, pay or cause to be paid to the Trustee all sums held in trust for any such series by the Issuer or any paying agent hereunder, as required by this Section, such sums to be held by the Trustee upon the trusts herein contained. Anything in this Section to the contrary notwithstanding, the agreement to hold sums in trust as provided in this Section is subject to the provisions of Sections 11.3 and 11.4. SECTION 4.5. CERTIFICATE OF THE ISSUER. The Issuer will deliver to the Trustee on or before May 1 in each year (beginning with 1996) a brief certificate (which need not comply with Section 12.5), from the principal executive, financial or accounting officer of the Issuer as to his or her knowledge of the Issuer's compliance with all conditions and covenants under the Indenture (such compliance to be determined without regard to any period of grace or requirements of notice provided under the Indenture). SECTION 4.6. CORPORATE EXISTENCE. Subject to Article Ten, the Issuer will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence, rights (charter and statutory) and franchises; provided, however, that the Issuer shall not be required to preserve any such right or franchise if it shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Issuer. As To The Guarantor: SECTION 4.7. CERTIFICATE OF THE GUARANTOR. The Guarantor will deliver to the Trustee on or before May 1 in each year (beginning with 1996) a brief certificate (which need not comply with Section 12.5), from the principal executive, financial or accounting officer of the Guarantor as to his or her knowledge of the Guarantor's compliance with all conditions and covenants under the Indenture (such compliance to be determined without regard to any period of grace or requirements of notice provided under the Indenture). SECTION 4.8. GUARANTOR TO MAINTAIN OFFICE OR AGENCY. The Guarantor will maintain in the Borough of 22 31 Manhattan, The City of New York, an office or agency where notices and demands to or upon the Guarantor in respect of the Securities of any series or this Indenture may be served, and an office or agency where the Securities may be presented for payment under the Guarantees. The Guarantor will give to the Trustee written notice of the location of any such office or agency and of any change of location thereof. In case the Guarantor shall fail to maintain any such office or agency or shall fail to give such notice of the location or of any change in the location thereof, presentations, surrenders and demands may be made and notices may be served at the corporate trust office of The First National Bank of Chicago, 14 Wall Street, Eighth Floor, New York, New York 10005. SECTION 4.9. CORPORATE EXISTENCE. Subject to Article Ten, the Guarantor will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence, rights (charter and statutory) and franchises; provided, however, that the Guarantor shall not be required to preserve any such right or franchise if it shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Guarantor. ARTICLE 5 SECURITYHOLDERS' LISTS AND REPORTS BY THE ISSUER AND THE TRUSTEE SECTION 5.1. SECURITYHOLDERS' LISTS. Each of the Issuer and the Guarantor covenants and agrees that if and so long as the Trustee shall not be the Security registrar for the Securities of any series, it will furnish or cause to be furnished to the Trustee a list in such form as the Trustee may reasonably require of the names and addresses of the holders of the Securities of each series pursuant to Section 312 of the Trust Indenture Act of 1939: (a) semiannually not more than 15 days after each record date for the payment of interest on such Securities, as hereinabove specified, as of such record date and on dates to be determined pursuant to Section 2.3 for non-interest bearing securities in each year, and (b) at such other times as the Trustee may request in writing, within 30 days after receipt by the Issuer of any such request as of a date not more than 15 days prior to the time such information is furnished. 23 32 SECTION 5.2. REPORTS BY THE ISSUER AND THE GUARANTOR. The Issuer and the Guarantor respectively covenant to file with the Trustee, within 15 days after the Issuer or the Guarantor, as the case may be, is required to file the same with the Commission, copies of the annual reports and of the information, documents, and other reports which the Issuer or the Guarantor, as the case may be, may be required to file with the Commission pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934. SECTION 5.3. REPORTS BY THE TRUSTEE. Any Trustee's Report required under Section 313(a) of the Trust Indenture Act of 1939 shall be transmitted on or before July 15 in each year following the date hereof, so long as any Securities are outstanding hereunder, and be dated as of a date convenient to the Trustee but no more than 60 nor less than 45 days prior thereto. ARTICLE 6 REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON EVENT OF DEFAULT SECTION 6.1. EVENT OF DEFAULT DEFINED; ACCELERATION OF MATURITY; WAIVER OF DEFAULT. "Event of Default" with respect to Securities of any series wherever used herein, means each one of the following events which shall have occurred and be continuing (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body): (a) default in the payment of any installment of interest upon any of the Securities of such series as and when the same shall become due and payable, and continuance of such default for a period of 30 days; or (b) default in the payment of all or any part of the principal of any of the Securities of such series as and when the same shall become due and payable either at maturity, upon redemption, by declaration or otherwise; or (c) default in the payment of any sinking fund installment as and when the same shall become due and payable by the terms of the Securities of such series; or (d) default in the performance, or breach, of any covenant or warranty of the Issuer or the Guarantor in 24 33 respect of the Securities of such series (other than a covenant or warranty in respect of the Securities of such series a default in whose performance or whose breach is elsewhere in this Section specifically dealt with), and continuance of such default or breach for a period of 90 days after there has been given, by registered or certified mail, to the Issuer and the Guarantor by the Trustee or to the Issuer and the Guarantor and the Trustee by the Holders of at least 25% in principal amount of the Outstanding Securities of all series affected thereby, a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a "Notice of Default" hereunder; or (e) a court having jurisdiction in the premises shall enter a decree or order for relief in respect of the Issuer or Guarantor in an involuntary case under any applicable bankruptcy, insolvency, reorganization or other similar law now or hereafter in effect, or a decree or order adjudging the Issuer or the Guarantor a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, assignment, adjustment or composition of, as in respect of, the Issuer or the Guarantor under any applicable federal or state law or appointing a receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the Issuer or the Guarantor or for any substantial part of the property of either of them or ordering the winding up or liquidation of either of their affairs, and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or (f) the Issuer or the Guarantor shall commence a voluntary case under any applicable bankruptcy, insolvency, reorganization or other similar law now or hereafter in effect or any other case to be adjudicated a bankrupt or insolvent, or consent to the filing of such petition or to the entry of an order for relief in an involuntary case under any such law or to the commencement of any bankruptcy or insolvency proceeding against the Issuer or the Guarantor, or the filing by the Issuer or the Guarantor of a petition or answer or consent seeking reorganization or relief under any applicable state or federal law, or consent to the filing of such petition or the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the Issuer or the Guarantor or for any substantial part of the property of either of them, or make any general assignment for the benefit of either of their creditors, or the admission in writing by the Issuer or the Guarantor, respectively, of its inability to pay its debts generally as they become due, or the taking of corporate action by the 25 34 Issuer or the Guarantor in furtherance of such bankruptcy; or (g) any other Event of Default established pursuant to Section 2.3 for the Securities for such series. If an Event of Default described in clauses (a), (b), (c), (d) or (g) above (if the Event of Default under clause (d) is with respect to less than all series of Securities then Outstanding) occurs and is continuing, then, and in each and every such case, unless the principal of all of the Securities of such series shall have already become due and payable, either the Trustee or the holders of not less than 25% in aggregate principal amount of the Securities of such series then Outstanding hereunder (each such series voting as a separate class) by notice in writing to the Issuer and to the Guarantor (and to the Trustee if given by Securityholders), may declare the entire principal (or, if the Securities of such series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series) of all Securities of such series and the interest accrued thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable. If an Event of Default described in clause (d) (if the Event of Default under clause (d) is with respect to all series of Securities then Outstanding), (e) or (f) occurs and is continuing, then and in each and every such case, unless the principal of all the Securities shall have already become due and payable, either the Trustee or the Holders of not less than 25% in aggregate principal amount of all the Securities then Outstanding hereunder (treated as one class), by notice in writing to the Issuer and to the Guarantor (and to the Trustee if given by Securityholders), may declare the entire principal (or, if any Securities are Original Issue Discount Securities, such portion of the principal as may be specified in the terms thereof) of all the Securities then outstanding and interest accrued thereon, if any, to be due and payable immediately, and upon any such declaration the same shall become immediately due and payable. The foregoing provisions, however, are subject to the condition that if, at any time after the principal (or, if the Securities of such series are Original Issue Discount Securities, such portion of the principal as may be specified in the terms thereof) of the Securities of any series (or of all the Securities, as the case may be) shall have been so declared due and payable, and before any judgment or decree for the payment of the moneys due shall have been obtained or entered as hereinafter provided, the 26 35 Issuer or the Guarantor shall pay or shall deposit with the Trustee a sum sufficient to pay all matured installments of interest upon all the Securities of such series (or of all the Securities, as the case may be) and the principal of any and all Securities of such series (or of all the Securities, as the case may be) which shall have become due otherwise than by acceleration (with interest upon such principal and, to the extent that payment of such interest is enforceable under applicable law, on overdue installments of interest, at the same rate as the rate of interest or Yield to Maturity (in the case of Original Issue Discount Securities) specified in the Securities of such series, (or at the respective rates of interest or Yields to Maturity of all the Securities, as the case may be) to the date of such payment or deposit) and such amount as shall be sufficient to cover reasonable compensation to the Trustee, its agents, attorneys and counsel, and all other expenses and liabilities incurred, and all advances made, by the Trustee except as a result of negligence or bad faith, and if any and all Events of Default under the Indenture, other than the non-payment of the principal of Securities of such series which shall have become due by acceleration, shall have been cured, waived or otherwise remedied as provided herein -- then and in every such case the holders of a majority in aggregate principal amount of all the Securities of such series, each series voting as a separate class by written notice to the Issuer, to the Guarantor and to the Trustee, may waive all defaults with respect to such series (or with respect to all the Securities, as the case may be) and rescind and annul such declaration and its consequences, but no such waiver or rescission and annulment shall extend to or shall affect any subsequent default or shall impair any right consequent thereon. For all purposes under this Indenture, if a portion of the principal of any Original Issue Discount Securities shall have been accelerated and declared due and payable pursuant to the provisions hereof, then, from and after such declaration, unless such declaration has been rescinded and annulled, the principal amount of such Original Issue Discount Securities shall be deemed, for all purposes hereunder, to be such portion of the principal thereof as shall be due and payable as a result of such acceleration, and payment of such portion of the principal thereof as shall be due and payable as a result of such acceleration, together with interest, if any, thereon and all other amounts owing thereunder, shall constitute payment in full of such Original Issue Discount Securities. SECTION 6.2. COLLECTION OF INDEBTEDNESS BY TRUSTEE; TRUSTEE MAY PROVE DEBT. The Issuer covenants that 27 36 (a) in case default shall be made in the payment of any installment of interest on any of the Securities of any series when such interest shall have become due and payable, and such default shall have continued for a period of 30 days or (b) in case default shall be made in the payment of all or any part of the principal of any of the Securities of any series when the same shall have become due and payable, whether upon maturity of the Securities of such series or upon any redemption or by declaration or otherwise (including any payments to any sinking fund or analogous obligation) then upon demand of the Trustee, the Issuer will pay to the Trustee for the benefit of the Holders of the Securities of such series the whole amount that then shall have become due and payable on all Securities of series for principal (including any payments to any sinking fund or analogous obligation) or interest, as the case may be (with interest to the date of such payment upon the overdue principal and, to the extent that payment of such interest is enforceable under applicable law, on overdue installments of interest at the same rate as the rate of interest or Yield to Maturity (in the case of Original Issue Discount Securities) specified in the Securities of such series); and in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including reasonable compensation to the Trustee and each predecessor Trustee, their respective agents, attorneys and counsel, and any expenses and liabilities incurred, and all advances made, by the Trustee and each predecessor Trustee except as a result of its negligence or bad faith. Until such demand is made by the Trustee, the Issuer may pay the principal of and interest on the Securities of any series to the registered holders, whether or not the principal of and interest on the Securities of such series be overdue. In case the Issuer shall fail forthwith to pay such amounts upon such demand, the Trustee, in its own name and as trustee of an express trust, shall be entitled and empowered to institute any action or proceedings at law or in equity for the collection of the sums so due and unpaid, and may prosecute any such action or proceedings to judgment or final decree, and may enforce any such judgment or final decree against the Issuer, the Guarantor or other obligor upon such Securities and collect in the manner provided by law out of the property of the Issuer, the Guarantor or other obligor upon such Securities, wherever situated, the moneys adjudged or decreed to be payable. In case there shall be pending proceedings relative to the Issuer, the Guarantor or any other obligor 28 37 upon the Securities under Title 11 of the United States Code or any other applicable Federal or state bankruptcy, insolvency or other similar law, or in case a receiver, assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator or similar official shall have been appointed for or taken possession of the Issuer or its property or the Guarantor or such other obligor, or in case of any other comparable judicial proceedings relative to the Issuer, the Guarantor or other obligor upon the Securities of any series, or to the creditors or property of the Issuer, the Guarantor or such other obligor, the Trustee, irrespective of whether the principal of any Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand pursuant to the provisions of this Section, shall be entitled and empowered, by intervention in such proceedings or otherwise: (a) to file and prove a claim or claims for the whole amount of principal and interest (or, if the Securities of any series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of such series) owing and unpaid in respect of the Securities of any series, and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for reasonable compensation to the Trustee and each predecessor Trustee, and their respective agents, attorneys and counsel, and for reimbursement of all expenses and liabilities incurred, and all advances made, by the Trustee and each predecessor Trustee, except as a result of negligence or bad faith) and of the Securityholders allowed in any judicial proceedings relative to the Issuer, the Guarantor or other obligor upon the Securities of any series, or to the creditors or property of the Issuer, the Guarantor or such other obligor, (b) unless prohibited by applicable law and regulations, to vote on behalf of the holders of the Securities of any series in any election of a trustee or a standby trustee in arrangement, reorganization, liquidation or other bankruptcy or insolvency proceedings or person performing similar functions in comparable proceedings, and (c) to collect and receive any moneys or other property payable or deliverable on any such claims, and to distribute all amounts received with respect to the claims of the Securityholders and of the Trustee on their behalf; and any trustee, receiver, or liquidator, custodian or other similar official is hereby authorized by each of the Securityholders to make payments to the Trustee, and, in the 29 38 event that the Trustee shall consent to the making of payments directly to the Securityholders, to pay to the Trustee such amounts as shall be sufficient to cover reasonable compensation to the Trustee, each predecessor Trustee and their respective agents, attorneys and counsel, and all other expenses and liabilities incurred, and all advances made, by the Trustee and each predecessor Trustee except as a result of negligence or bad faith and all other amounts due to the Trustee or any predecessor Trustee pursuant to Section 7.6. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or vote for or accept or adopt on behalf of any Securityholder any plan or reorganization, arrangement, adjustment or composition affecting the Securities of any series or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Securityholder in any such proceeding except, as aforesaid, to vote for the election of a trustee in bankruptcy or similar person. All rights of action and of asserting claims under this Indenture, or under any of the Securities, may be enforced by the Trustee without the possession of any of the Securities or the production thereof on any trial or other proceedings relative thereto, and any such action or proceedings instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment, subject to the payment of the expenses, disbursements and compensation of the Trustee, each predecessor Trustee and their respective agents and attorneys, shall be for the ratable benefit of the holders of the Securities in respect of which such action was taken. In any proceedings brought by the Trustee (and also any proceedings involving the interpretation of any provision of this Indenture to which the Trustee shall be a party) the Trustee shall be held to represent all the holders of the Securities in respect to which such action was taken, and it shall not be necessary to make any holders of such Securities parties to any such proceedings. SECTION 6.3. APPLICATION OF PROCEEDS. Any moneys collected by the Trustee pursuant to this Article in respect of any series shall be applied in the following order at the date or dates fixed by the Trustee and, in case of the distribution of such moneys on account of principal or interest, upon presentation of the several Securities in respect of which monies have been collected and stamping (or otherwise noting) thereon the payment, or issuing Securities of such series in reduced principal amounts in exchange for 30 39 the presented Securities of like series if only partially paid, or upon surrender if fully paid: FIRST: To the payment of costs and expenses applicable to such series in respect of which monies have been collected, including reasonable compensation to the Trustee and each predecessor Trustee and their respective agents and attorneys and of all expenses and liabilities incurred, and all advances made, by the Trustee and each predecessor Trustee except as a result of negligence or bad faith, and all other amounts due to the Trustee or any predecessor Trustee pursuant to Section 7.6; SECOND: Subject to the provisions of Article Fifteen, in case the principal of the Securities of such series in respect of which moneys have been collected shall not have become and be then due and payable, to the payment of interest on the Securities of such series in default in the order of the maturity of the installments of such interest, with interest (to the extent that such interest has been collected by the Trustee) upon the overdue installments of interest at the same rate as the rate of interest or Yield to Maturity (in the case of Original Issue Discount Securities) specified in such Securities, such payments to be made ratably to the persons entitled thereto, without discrimination or preference; THIRD: Subject to the provisions of Article Fifteen, in case the principal of the Securities of such series in respect of which moneys have been collected shall have become and shall be then due and payable, to the payment of the whole amount then owing and unpaid upon all the Securities of such series for principal and interest, with interest upon the overdue principal, and (to the extent that such interest has been collected by the Trustee) upon overdue installments of interest at the same rate as the rate of interest or Yield to Maturity (in the case of Original Issue Discount Securities) specified in the Securities of such series; and in case such moneys shall be insufficient to pay in full the whole amount so due and unpaid upon the Securities of such series, then to the payment of such principal and interest, without preference or priority of principal over interest, or of interest over principal, or of any installment, of interest over any other installment of interest, or of any Security of such series over any other Security of such series, ratably to the aggregate of such principal and accrued and unpaid interest; and 31 40 FOURTH: Subject to the provisions of Article Fifteen, to the payment of the remainder, if any, to the Issuer or any other person lawfully entitled thereto. SECTION 6.4. SUITS FOR ENFORCEMENT. In case an Event of Default has occurred, has not been waived and is continuing, the Trustee may in its discretion proceed to protect and enforce the rights vested in it by this Indenture by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any of such rights, either at law or in equity or in bankruptcy or otherwise, whether for the specific enforcement of any covenant or agreement contained in this Indenture or in aid of the exercise of any power granted in this Indenture or to enforce any other legal or equitable right vested in the Trustee by this Indenture or by law. SECTION 6.5. RESTORATION OF RIGHTS ON ABANDONMENT OF PROCEEDINGS. In case the Trustee or any Holder shall have instituted any proceeding to enforce any right under this Indenture and such proceedings shall have been discontinued or abandoned for any reason, or shall have been determined adversely to the Trustee or to such Holder, then and in every such case the Issuer, the Guarantor and the Trustee shall be restored respectively to their former positions and rights hereunder, and all rights, remedies and powers of the Issuer, the Guarantor, the Trustee and the Securityholders shall continue as though no such proceedings had been taken. SECTION 6.6. LIMITATIONS ON SUITS BY SECURITYHOLDERS. No holder of any Security of any series shall have any right by virtue or by availing of any provision of this Indenture to institute any action or proceeding at law or in equity or in bankruptcy or otherwise upon or under or with respect to this Indenture, or for the appointment of a trustee, receiver, liquidator, custodian or other similar official or for any other remedy hereunder, unless such holder previously shall have given to the Trustee written notice of default and of the continuance thereof, as hereinbefore provided, and unless also the holders of not less than 25% in aggregate principal amount of the Securities of such series then Outstanding shall have made written request upon the Trustee to institute such action or proceedings in its own name as trustee hereunder and shall have offered to the Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or thereby and the Trustee for 60 days after its receipt of such notice, request and offer of indemnity shall have failed to 32 41 institute any such action or proceeding and no direction inconsistent with such written request shall have been given to the Trustee pursuant to Section 6.9; it being understood and intended, and being expressly covenanted by the taker and Holder of every Security with every other taker and Holder and the Trustee, that no one or more Holders of Securities of any series shall have any right in any manner whatever by virtue or by availing of any provision of this Indenture to affect, disturb or prejudice the rights of any other such Holder of Securities, or to obtain or seek to obtain priority over or preference to any other such Holder or to enforce any right under this Indenture, except in the manner herein provided and for the equal, ratable and common benefit of all Holders of Securities of the applicable series. For the protection and enforcement of the provisions of this Section, each and every Securityholder and the Trustee shall be entitled to such relief as can be given either at law or in equity. SECTION 6.7. UNCONDITIONAL RIGHT OF SECURITYHOLDERS TO INSTITUTE CERTAIN SUITS. Notwithstanding any other provision in this Indenture and any provision of any Security, the right of any Holder of any Security to receive payment of the principal of and interest on such Security on or after the respective due dates expressed in such Security or to convert such Securities in accordance with Article Fourteen, or to institute suit for the enforcement of any such payment on or after such respective dates or any such right of conversion, shall not be impaired or affected without the consent of such Holder. SECTION 6.8. POWERS AND REMEDIES CUMULATIVE; DELAY OR OMISSION NOT WAIVER OF DEFAULT. Except as provided in Section 6.6, no right or remedy herein conferred upon or reserved to the Trustee or to the Securityholders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. No delay or omission of the Trustee or of any Securityholder to exercise any right or power accruing upon any Event of Default occurring and continuing as aforesaid shall impair any such right or power or shall be construed to be a waiver of any such Event of Default or an acquiescence therein; and, subject to Section 6.6, every power and remedy given by this Indenture or by law to the 33 42 Trustee or to the Securityholders may be exercised from time to time, and as often as shall be deemed expedient, by the Trustee or by the Securityholders. SECTION 6.9. CONTROL BY SECURITYHOLDERS. The Holders of a majority in aggregate principal amount of the Securities of each series affected (with each series voting as a separate class) at the time Outstanding shall have the right to direct the time, method, and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee with respect to the Securities of such series by this Indenture; provided that such direction shall not be otherwise than in accordance with law and the provisions of this Indenture and provided further that (subject to the provisions of Section 7.1) the Trustee shall have the right to decline to follow any such direction if the Trustee, being advised by counsel, shall determine that the action or proceeding so directed may not lawfully be taken or if the Trustee in good faith by its Board of Directors, the Executive Committee, or a Trust Committee of Directors or Responsible Officers or the Trustee shall determine that the action or proceedings so directed would involve the Trustee in personal liability or if the Trustee in good faith shall so determine that the actions or forebearances specified in or pursuant to such direction would be unduly prejudicial to the interests of Holders of the Securities of all series so affected not joining in the giving of said direction, it being understood that (subject to Section 7.1) the Trustee shall have no duty to ascertain whether or not such actions or forebearances are unduly prejudicial to such Holders. Nothing in this Indenture shall impair the right of the Trustee in its discretion to take any action deemed proper by the Trustee and which is not inconsistent with such direction or directions by Securityholders. SECTION 6.10. WAIVER OF PAST DEFAULTS. Prior to the declaration of the acceleration of the maturity of the Securities of any series as provided in Section 6.1, the Holders of a majority in aggregate principal amount of the Securities of such series at the time Outstanding (each such series voting as a separate class) may on behalf of the Holders of all the Securities of such series waive any past default or Event of Default described in clause (c) of Section 6.1 (or, in the case of an event specified in clause (d) or (g) of Section 6.1 which relates to less than all series of Securities then Outstanding, the Holders of a majority in aggregate principal amount of the Securities then Outstanding affected thereby (each series voting as a separate class)) may waive any such default or Event of 34 43 Default, or, in the case of an event specified in clause (d) or (g) (if the Event of Default under clause (d) or (g) relates to all series of Securities then Outstanding), (e) or (f) of Section 6.1 the Holders of Securities of a majority in principal amount of all the Securities then Outstanding (voting as one class) may waive any such default or Event of Default), and its consequences except a default in respect of a covenant or provision hereof which cannot be modified or amended without the consent of the Holder of each Security affected. In the case of any such waiver, the Issuer, the Guarantor, the Trustee and the Holders of the Securities of such series shall be restored to their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon. Upon any such waiver, such default shall cease to exist and be deemed to have been cured and not to have occurred, and any Event of Default arising therefrom shall be deemed to have been cured, and not to have occurred for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or Event of Default or impair any right consequent thereon. SECTION 6.11. TRUSTEE TO GIVE NOTICE OF DEFAULT, BUT MAY WITHHOLD IN CERTAIN CIRCUMSTANCES. The Trustee shall transmit to the Securityholders of any series, as the names and addresses of such Holders appear on the registry books, notice by mail of all defaults known to the Trustee which have occurred with respect to such series, such notice to be transmitted within 90 days after the occurrence thereof, unless such defaults shall have been cured before the giving of such notice (the term "default" or "defaults" for the purposes of this Section being hereby defined to mean any event or condition which is, or with notice or lapse of time or both would become, an Event of Default); provided that, except in the case of default in the payment of the principal of or interest on any of the Securities of such series, the Trustee shall be protected in withholding such notice if and so long as the Board of Directors, the Executive Committee, or a Trust Committee of Directors or Trustees and/or Responsible Officers of the Trustee in good faith determines that the withholding of such notice is in the interests of the Securityholders of such series. SECTION 6.12. RIGHT OF COURT TO REQUIRE FILING OF UNDERTAKING TO PAY COSTS. All parties to this Indenture agree, and each Holder of any Security by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture or in any suit 35 44 against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Trustee, to any suit instituted by any Securityholder or group of Securityholders of any series holding in the aggregate more than 10% in aggregate principal amount of the Securities of such series, or, in the case of any suit relating to or arising under clause (d) of Section 6.1 (if the suit relates to Securities of more than one but less than all series), 10% in aggregate principal amount of Securities Outstanding affected thereby, or in the case of any suit relating to or arising under clause (d) (if the suit under clause (d) relates to all the Securities then Outstanding), (e) or (f) of Section 6.1, 10% in aggregate principal amount of all Securities Outstanding, or to any suit instituted by any Securityholder for the enforcement of the payment of the principal of or interest on any Security on or after the due date expressed in such Security. SECTION 6.13. WAIVER OF STAY OR EXTENSION LAWS. The Issuer and the Guarantor covenant (to the extent that they may lawfully do so) that they will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Issuer and the Guarantor (to the extent that they may lawfully do so) hereby expressly waive all benefit or advantage of any such law and covenants that they will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. ARTICLE 7 CONCERNING THE TRUSTEE SECTION 7.1. DUTIES AND RESPONSIBILITIES OF THE TRUSTEE; DURING DEFAULT; PRIOR TO DEFAULT. With respect to the Holders of any series of Securities issued hereunder, the Trustee, prior to the occurrence of an Event of Default with respect to the Securities of a particular series and after the curing or waiving of all Events of Default which 36 45 may have occurred with respect to such series, undertakes to perform such duties and only such duties as are specifically set forth in this Indenture. In case an Event of Default with respect to the Securities of a series has occurred (which has not been cured or waived) the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act or its own wilful misconduct, except that: (a) prior to the occurrence of an Event of Default with respect to the Securities of any series and after the curing or waiving of all such Events of Default with respect to such series which may have occurred: (i) the duties and obligations of the Trustee with respect to the Securities of any Series shall be determined solely by the express provisions of this Indenture, and the Trustee shall not be liable except for the performance of such duties and obligations as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and (ii) in the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon any statements, certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such statements, certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture; (b) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer or Responsible Officers of the Trustee, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; and 37 46 (c) the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the holders pursuant to Section 6.9 relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture. None of the provisions contained in this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur personal financial liability in the performance of any of its duties or in the exercise of any of its rights or powers, if there shall be reasonable ground for believing that the repayment of such funds or adequate indemnity against such liability is not reasonably assured to it. The provisions of this Section 7.1 are in furtherance of and subject to Sections 315 and 316 of the Trust Indenture Act of 1939. SECTION 7.2. CERTAIN RIGHTS OF THE TRUSTEE. In furtherance of and subject to the Trust Indenture Act of 1939 and subject to Section 7.1: (a) the Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, Officers' Certificate or any other certificate, statement, instrument, opinion, report, notice, request, consent, order, bond, debenture, note, coupon, security or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties; (b) any request, direction, order or demand of the Issuer or the Guarantor mentioned herein shall be sufficiently evidenced by an Officers' Certificate (unless other evidence in respect thereof be herein specifically prescribed); and any resolution of the Board of Directors of the Issuer or the Guarantor may be evidenced to the Trustee by a copy thereof certified by the Secretary or an Assistant Secretary of the Issuer or the Guarantor, as the case may be; (c) the Trustee may consult with counsel and any advice or Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted to be taken by it hereunder in good faith and in accordance with such advice or Opinion of Counsel; 38 47 (d) the Trustee shall be under no obligation to exercise any of the trusts or powers vested in it by this Indenture at the request, order or direction of any of the Securityholders pursuant to the provisions of this Indenture, unless such Securityholders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred therein or thereby; (e) the Trustee shall not be liable for any action taken or omitted by it in good faith and believed by it to be authorized or within the discretion, rights or powers conferred upon it by this Indenture; (f) prior to the occurrence of an Event of Default hereunder and after the curing or waiving of all Events of Default, the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, appraisal, bond, debenture, note, coupon, security, or other paper or document unless requested in writing so to do by the holders of not less than a majority in aggregate principal amount of the Securities of all series affected then outstanding; provided that, if the payment within a reasonable time to the Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Trustee, not reasonably assured to the Trustee by the security afforded to it by the terms of this Indenture, the Trustee may require reasonable indemnity against such expenses or liabilities as a condition to proceeding; the reasonable expenses of every such investigation shall be paid by the Issuer or the Guarantor or, if paid by the Trustee or any predecessor trustee, shall be repaid by the Issuer or the Guarantor upon demand; and (g) the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys not regularly in its employ and the Trustee shall not be responsible for any misconduct or negligence on the part of any such agent or attorney appointed with due care by it hereunder. SECTION 7.3. TRUSTEE NOT RESPONSIBLE FOR RECITALS, DISPOSITION OF SECURITIES OR APPLICATION OF PROCEEDS THEREOF. The recitals contained herein and in the Securities and the Guarantees, except the Trustee's certificates of authentication, shall be taken as the statements of the Issuer or the Guarantor, as the case may be, and the Trustee assumes no responsibility for the 39 48 correctness of the same. The Trustee makes no representation as to the validity or sufficiency of this Indenture or of the Securities or of the Guarantees. The Trustee shall not be accountable for the use or application by the Issuer of any of the Securities or of the proceeds thereof. SECTION 7.4. TRUSTEE AND AGENTS MAY HOLD SECURITIES; COLLECTIONS, ETC. The Trustee or any agent of the Issuer, the Guarantor or the Trustee, in its individual or any other capacity, may become the owner or pledgee of Securities with the same rights it would have if it were not the Trustee or such agent and may otherwise deal with the Issuer and receive, collect, hold and retain collections from the Issuer and the Guarantor with the same rights it would have if it were not the Trustee or such agent. SECTION 7.5. MONEYS HELD BY TRUSTEE. Subject to the provisions of Section 11.4 hereof, all moneys received by the Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated from other funds except to the extent required by mandatory provisions of law. Neither the Trustee nor any agent of the Issuer, the Guarantor or the Trustee shall be under any liability for interest on any moneys received by it hereunder. SECTION 7.6. COMPENSATION AND INDEMNIFICATION OF TRUSTEE AND ITS PRIOR CLAIM. The Issuer covenants and agrees to pay to the Trustee from time to time, and the Trustee shall be entitled to, reasonable compensation (which shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust) and the Issuer covenants and agrees to pay or reimburse the Trustee and each predecessor Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by or on behalf of it in accordance with any of the provisions of this Indenture (including the reasonable compensation and the expenses and disbursements of its counsel and of all agents and other persons not regularly in its employ) except any such expense, disbursement or advance as may arise from its negligence or bad faith. The Issuer also covenants to indemnify the Trustee and each predecessor Trustee for, and to hold it harmless against, any loss, liability or expense incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of this Indenture or the trusts hereunder and its duties hereunder, including the costs and expenses of defending itself against or investigating any claim of liability in the premises. The obligations of the Issuer under this Section to compensate and indemnify the 40 49 Trustee and each predecessor Trustee and to pay or reimburse the Trustee and each predecessor Trustee for expenses, disbursements and advances shall constitute additional indebtedness hereunder and shall survive the satisfaction and discharge of this Indenture. Such additional indebtedness shall be a senior claim to that of the Securities upon all property and funds held or collected by the Trustee as such, except funds held in trust for the benefit of the holders of particular Securities, and the Securities are hereby subordinated to such senior claim. SECTION 7.7. RIGHT OF TRUSTEE TO RELY ON OFFICERS' CERTIFICATE, ETC. Subject to Sections 7.1 and 7.2, whenever in the administration of the trusts of this Indenture the Trustee shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering or omitting any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of negligence or bad faith on the part of the Trustee, be deemed to be conclusively proved and established by an Officers' Certificate of the Issuer or the Guarantor delivered to the Trustee, and such certificate, in the absence of negligence or bad faith on the part of the Trustee, shall be full warrant to the Trustee for any action taken, suffered or omitted by it under the provisions of this Indenture upon the faith thereof. SECTION 7.8. PERSONS ELIGIBLE FOR APPOINTMENT AS TRUSTEE. The Trustee for each series of Securities hereunder shall at all times be a corporation having a combined capital and surplus of at least $50,000,000, and which is eligible in accordance with the provisions of Section 310(a) of the Trust Indenture Act of 1939. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of a Federal, State, or District of Columbia supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. For purposes of Section 310(b) of the Trust Indenture Act of 1939, the Trustee shall not be deemed to have a conflicting interest as a result of being Trustee in respect of the Securities of more than one series hereunder or under the Indenture dated as of __________ __, 199_ between The Chubb Corporation and the Trustee. SECTION 7.9. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR TRUSTEE. (a) The Trustee, or any trustee or trustees hereafter appointed, may at any time 41 50 resign with respect to one or more or all series of Securities by giving written notice of resignation to the Issuer and the Guarantor and by mailing notice thereof by first class mail to Holders of the applicable series of Securities at their last addresses as they shall appear on the Security register. Upon receiving such notice of resignation, the Issuer shall promptly appoint a successor trustee or trustees with respect to the applicable series by written instrument in duplicate, executed by authority of the Board of Directors of the Issuer, one copy of which instrument shall be delivered to the resigning Trustee and one copy to the successor trustee or trustees. If no successor trustee shall have been so appointed with respect to any series and have accepted appointment within 30 days after the mailing of such notice of resignation, the resigning trustee may petition any court of competent jurisdiction for the appointment of a successor trustee, or any Securityholder who has been a bona fide Holder of a Security or Securities of the applicable series for at least six months may, subject to the provisions of Section 6.12, on behalf of himself and all others similarly situated, petition any such court for the appointment of a successor trustee. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, appoint a successor trustee. (b) In case at any time any of the following shall occur: (i) the Trustee shall fail to comply with the provisions of Section 310(b) of the Trust Indenture Act of 1939 with respect to any series of Securities after written request therefor by the Issuer or by any Securityholder who has been a bona fide Holder of a Security or Securities of such series for at least six months; or (ii) the Trustee shall cease to be eligible in accordance with the provisions of Section 310(a) of the Trust Indenture Act of 1939 and shall fail to resign after written request therefor by the Issuer or by any Securityholder; or (iii) the Trustee shall become incapable of acting with respect to any series of Securities, or shall be adjudged a bankrupt or insolvent, or a receiver or liquidator of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation; 42 51 then, in any such case, the Issuer may remove the Trustee with respect to the applicable series of Securities and appoint a successor trustee for such series by written instrument, in duplicate, executed by order of the Board of Directors of the Issuer, one copy of which instrument shall be delivered to the Trustee so removed and one copy to the successor trustee, or, subject to Section 315(e) of the Trust Indenture Act of 1939, any Securityholder who has been a bona fide Holder of a Security or Securities of such series for at least six months may on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor trustee with respect to such series. Such court may thereupon, after such notice, if any, as it may deem proper and prescribe, remove the Trustee and appoint a successor trustee. (c) The Holders of a majority in aggregate principal amount of the Securities of each series at the time Outstanding may at any time remove the Trustee with respect to Securities of such series and appoint a successor trustee with respect to the Securities of such series by delivering to the Trustee so removed, to the successor trustee so appointed, to the Issuer and to the Guarantor the evidence provided for in Section 8.1 of the action in that regard taken by the Securityholders. (d) Any resignation or removal of the Trustee with respect to any series and any appointment of a successor trustee with respect to such series pursuant to any of the provisions of this Section 7.9 shall become effective upon acceptance of appointment by the successor trustee as provided in Section 7.10. SECTION 7.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR TRUSTEE. Any successor trustee appointed as provided in Section 7.9 shall execute and deliver to the Issuer, the Guarantor and to its predecessor trustee an instrument accepting such appointment hereunder, and thereupon the resignation or removal of the predecessor trustee with respect to all or any applicable series shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all rights, powers, duties and obligations with respect to such series of its predecessor hereunder, with like effect as if originally named as trustee for such series hereunder; but, nevertheless, on the written request of the Issuer or of the successor trustee, upon payment of its charges then unpaid, the trustee ceasing to act shall, subject to Section 11.4, pay over to the successor trustee all moneys at the time held by it hereunder and shall execute and deliver an 43 52 instrument transferring to such successor trustee all such rights, powers, duties and obligations. Upon request of any such successor trustee, the Issuer and the Guarantor shall execute any and all instruments in writing for more fully and certainly vesting in and confirming to such successor trustee all such rights and powers. Any trustee ceasing to act shall, nevertheless, retain a prior claim upon all property or funds held or collected by such trustee to secure any amounts then due it pursuant to the provisions of Section 7.6. If a successor trustee is appointed with respect to the Securities of one or more (but not all) series, the Issuer, the Guarantor, the predecessor Trustee and each successor trustee with respect to the Securities of any applicable series shall execute and deliver an indenture supplemental hereto which shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the predecessor Trustee with respect to the Securities of any series as to which the predecessor Trustee is not retiring shall continue to be vested in the predecessor Trustee, and shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such trustees co-trustees of the same trust and that each such trustee shall be trustee of a trust or trusts under separate indentures. No successor trustee with respect to any series of Securities shall accept appointment as provided in this Section 7.10 unless at the time of such acceptance such successor trustee shall be qualified under the provisions of Section 310(b) of the Trust Indenture Act of 1939 and eligible under the provisions of Section 310(a) of the Trust Indenture Act of 1939. Upon acceptance of appointment by any successor trustee as provided in this Section 7.10, the Issuer shall mail notice thereof by first-class mail to the Holders of Securities of any series for which such successor trustee is acting as trustee at their last addresses as they shall appear in the Security register. If the acceptance of appointment is substantially contemporaneous with the resignation, then the notice called for by the preceding sentence may be combined with the notice called for by Section 7.9. If the Issuer fails to mail such notice within ten days after acceptance of appointment by the successor trustee, the successor trustee shall cause such notice to be mailed at the expense of the Issuer. 44 53 SECTION 7.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS OF TRUSTEE. Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided that such corporation shall be eligible under the provisions of Section 7.8, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding. In case at the time such successor to the Trustee shall succeed to the trusts created by this Indenture any of the Securities of any series shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor Trustee and deliver such Securities so authenticated; and, in case at that time any of the Securities of any series shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the name of the successor Trustee; and in all such cases such certificate shall have the full force which it is anywhere in the Securities of such series or in this Indenture provided that the certificate of the Trustee shall have; provided, that the right to adopt the certificate of authentication of any predecessor Trustee or to authenticate Securities of any series in the name of any predecessor Trustee shall apply only to its successor or successors by merger, conversion or consolidation. ARTICLE 8 CONCERNING THE SECURITYHOLDERS SECTION 8.1. EVIDENCE OF ACTION TAKEN BY SECURITYHOLDERS. Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by a specified percentage in principal amount of the Securityholders of any or all series may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such specified percentage of Securityholders in person or by agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee. Proof of execution of any instrument or of a writing appointing any such agent shall be sufficient for 45 54 any purpose of this Indenture and (subject to Sections 7.1 and 7.2) conclusive in favor of the Trustee and the Issuer, if made in the manner provided in this Article. SECTION 8.2. PROOF OF EXECUTION OF INSTRUMENTS AND OF HOLDING OF SECURITIES. Subject to Sections 7.1 and 7.2, the execution of any instrument by a Securityholder or his agent or proxy may be proved in accordance with such reasonable rules and regulations as may be prescribed by the Trustee or in such manner as shall be satisfactory to the Trustee. The holding of Securities shall be proved by the Security register or by a certificate of the registrar thereof. The Issuer may set a record date for purposes of determining the identity of holders of Securities of any series entitled to vote or consent to any action referred to in Section 8.1, which record date may be set at any time or from time to time by notice to the Trustee, for any date or dates (in the case of any adjournment or reconsideration) not more than 60 days nor less than five days prior to the proposed date of such vote or consent, and thereafter, notwithstanding any other provisions hereof, only holders of Securities of such series of record on such record date shall be entitled to so vote or give such consent or revoke such vote or consent. SECTION 8.3. HOLDERS TO BE TREATED AS OWNERS. The Issuer, the Guarantor, the Trustee and any agent of the Issuer, the Guarantor or the Trustee may deem and treat the person in whose name any Security shall be registered upon the Security register for such series as the absolute owner of such Security (whether or not such Security shall be overdue and notwithstanding any notation of ownership or other writing thereon) for the purpose of receiving payment of or on account of the principal of and, subject to the provisions of this Indenture, interest on such Security and for all other purposes; and the Issuer, the Guarantor, the Trustee or any agent of any of them shall not be affected by any notice to the contrary. All such payments so made to any such person, or upon his order, shall be valid, and, to the extent of the sum or sums so paid, effectual to satisfy and discharge the liability for moneys payable upon any such Security. SECTION 8.4. SECURITIES OWNED BY ISSUER OR THE GUARANTOR DEEMED NOT OUTSTANDING. In determining whether the Holders of the requisite aggregate principal amount of Outstanding Securities of any or all series have concurred in any direction, consent or waiver under this Indenture, Securities which are owned by the Issuer or the Guarantor or any other obligor on the Securities with respect to which such determination is being made or by any person directly 46 55 or indirectly controlling or controlled by or under direct or indirect common control with the Issuer or any other obligor on the Securities with respect to which such determination is being made shall be disregarded and deemed not to be Outstanding for the purpose of any such determination, except that for the purpose of determining whether the Trustee shall be protected in relying on any such direction, consent or waiver only Securities which the Trustee knows are 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 Issuer or the Guarantor or any other obligor upon the Securities or any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer or the Guarantor or any other obligor on the Securities. In case of a dispute as to such right, the advice of counsel shall be full protection in respect of any decision made by the Trustee in accordance with such advice. Upon request of the Trustee, the Issuer shall furnish to the Trustee promptly an Officers' Certificate listing and identifying all Securities, if any, known by the Issuer to be owned or held by or for the account of any of the above-described persons; and, subject to Sections 7.1 and 7.2, the Trustee shall be entitled to accept such Officers' Certificate as conclusive evidence of the facts therein set forth and of the fact that all Securities not listed therein are Outstanding for the purpose of any such determination. SECTION 8.5. RIGHT OF REVOCATION OF ACTION TAKEN. At any time prior to (but not after) the evidencing to the Trustee, as provided in Section 8.1, of the taking of any action by the Holders of the percentage in aggregate principal amount of the Securities of any or all series, as the case may be, specified in this Indenture in connection with such action, any Holder of a Security the serial number of which is shown by the evidence to be included among the serial numbers of the Securities the Holders of which have consented to such action may, by filing written notice at the Corporate Trust Office and upon proof of holding as provided in this Article, revoke such action so far as concerns such Security. Except as aforesaid any such action taken by the Holder of any Security shall be conclusive and binding upon such Holder and upon all future Holders and owners of such Security and of any Securities issued in exchange or substitution therefor, irrespective of whether or not any notation in regard thereto is made upon any such Security. Any action taken by the Holders of the percentage in aggregate principal amount of the Securities of any or 47 56 all series, as the case may be, specified in this Indenture in connection with such action shall be conclusively binding upon the Issuer, the Trustee and the Holders of all the Securities affected by such action. ARTICLE 9 SUPPLEMENTAL INDENTURES SECTION 9.1. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF SECURITYHOLDERS. The Issuer, when authorized by a resolution of its Board of Directors, and the Guarantor, when authorized by a resolution of its Board of Directors, and the Trustee may from time to time and at any time enter into an indenture or indentures supplemental hereto for one or more of the following purposes: (a) to convey, transfer, assign, mortgage or pledge to the Trustee as security for the Securities of one or more series any property or assets; (b) to evidence the succession of another corporation to the Issuer or to the Guarantor, or successive successions, and the assumption by the successor corporation of the covenants, agreements and obligations of the Issuer or the Guarantor, as the case may be, pursuant to Article Ten; (c) to add to the covenants of the Issuer or of the Guarantor such further covenants, restrictions, conditions or provisions as the Board of Directors of the Issuer and the Board of Directors of the Guarantor, as the case may be, and the Trustee shall consider to be for the protection of the Holders of Securities, and to make the occurrence, or the occurrence and continuance, of a default in any such additional covenants, restrictions, conditions or provisions an Event of Default permitting the enforcement of all or any of the several remedies provided in this Indenture as herein set forth; provided, that in respect of any such additional covenant, restriction, condition or provision such supplemental indenture may provide for a particular period of grace after default (which period may be shorter or longer than that allowed in the case of other defaults) or may provide for an immediate enforcement upon such an Event of Default or may limit the remedies available to the Trustee upon such an Event of Default or may limit the right of the Holders of a majority in aggregate principal amount of the Securities of such series to waive such an Event of Default; 48 57 (d) to cure any ambiguity or to correct or supplement any provision contained herein or in any supplemental indenture which may be defective or inconsistent with any other provision contained herein or in any supplemental indenture; or to make such other provisions in regard to matters or questions arising under this Indenture or under any supplemental indenture as the Board of Directors of the Issuer and the Board of Directors of the Guarantor may deem necessary or desirable and which shall not adversely affect the interests of the Holders of the Securities in any material respect; (e) to establish the forms or terms of Securities of any series as permitted by Sections 2.1 and 2.3; (f) to evidence and provide for the acceptance of appointment hereunder by a successor trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one trustee, pursuant to the requirements of Section 7.10; (g) to add to or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of Securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons, or to permit or facilitate the issuance of Securities in uncertificated form; or (h) to change or eliminate any of the provisions of this Indenture including, without limitation, any of the provisions set forth in Article Fifteen, provided that any such change or elimination shall become effective only as to Securities of any series created after the execution of such supplemental indenture. (i) to make provision with respect to the conversion rights of Holders pursuant to the requirements of Article Fourteen, including providing for the conversion of the Securities into any security (other than the Common Stock of the Guarantor) or property of the Issuer. The Trustee is hereby authorized to join with the Issuer and the Guarantor in the execution of any such supplemental indenture, to make any further appropriate agreements and stipulations which may be therein contained and to accept the conveyance, transfer, assignment, mortgage or pledge of any property thereunder, but the Trustee shall not be obligated to enter into any such supplemental 49 58 indenture which affects the Trustee's own rights, duties or immunities under this Indenture or otherwise. Any supplemental indenture authorized by the provisions of this Section may be executed without the consent of the Holders of any of the Securities at the time outstanding, notwithstanding any of the provisions of Section 9.2. SECTION 9.2. SUPPLEMENTAL INDENTURES WITH CONSENT OF SECURITYHOLDERS. With the consent (evidenced as provided in Article Eight) of the Holders of not less than a majority in aggregate principal amount of the Securities at the time Outstanding of all series affected by such supplemental indenture (voting as one class), the Issuer, when authorized by a resolution of its Board of Directors, and the Guarantor, when authorized by a resolution of its Board of Directors, and the Trustee may, from time to time and at any time, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of any supplemental indenture or of modifying in any manner the rights of the Holders of the Securities of each such series; provided, that no such supplemental indenture shall (a) extend the final maturity of any Security, or reduce the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon, or reduce any amount payable on redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof pursuant to Section 6.1 or the amount thereof provable in bankruptcy pursuant to Section 6.2, or change the currency of payment of principal of or interest on any Security, or extend the time or reduce the amount of any payment to any sinking fund or analogous obligation relating to any Security, or impair or affect the right of any Securityholder to institute suit for the payment thereof or, if the Securities provide therefor, any right of repayment at the option of the Securityholder, or modify the provisions of this Indenture with respect to the subordination of Securities of any series in a manner adverse to the Holders, without the consent of the Holder of each Security so affected, or (b) reduce the aforesaid percentage of Securities of any series, the consent of the Holders of which is required for any such supplemental indenture, without the consent of the Holders of each Security so offered, or (c) if applicable, make any change that adversely affects the right to convert any Security to which the provisions of Article Fourteen are applicable or, except as provided in this Indenture, decrease the 50 59 conversion rate or increase the conversion price of any such Security, without the consent of the Holder of each Security so affected, or (d) reduce to percentage of Securities of any series necessary to consent to waive any past default under this Indenture to less than a majority, without the consent of the Holders of each Security so affected, or (e) modify any of the provisions of this Section 9.2, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Security affected thereby, provided however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to "the Trustee" and concomitant changes in this Section, or the deletion of this proviso, in accordance with the requirements of Sections 7.9, 7.10, 7.11 and 9.2. 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. Upon the request of (i) the Issuer, accompanied by a copy of a resolution of the Board of Directors certified by the Secretary or an Assistant Secretary of the Issuer, or (ii) the Guarantor, accompanied by a resolution of its Board of Directors, certified by the Secretary or an Assistant Secretary of the Guarantor, authorizing, in either case, the execution of any such supplemental indenture, and upon the filing with the Trustee of evidence of the consent of Securityholders as aforesaid and other documents, if any, required by Section 8.1, the Trustee shall join with the Issuer and the Guarantor in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee's own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such supplemental indenture. It shall not be necessary for the consent of the Securityholders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such consent shall approve the substance thereof. Promptly after the execution by the Issuer, the Guarantor and the Trustee of any supplemental indenture 51 60 pursuant to the provisions of this Section, the Issuer shall mail a notice thereof by first class mail to the Holders of Securities of each series affected thereby at their addresses as they shall appear on the registry books of the Issuer, setting forth in general terms the substance of such supplemental indenture. Any failure of the Issuer to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture. SECTION 9.3. EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of any supplemental indenture pursuant to the provisions hereof, this Indenture shall be and be deemed to be modified and amended in accordance therewith and the respective rights, limitations of rights, obligations, duties and immunities under this Indenture of the Trustee, the Issuer, the Guarantor and the Holders of Securities of each series affected thereby shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes. SECTION 9.4. DOCUMENTS TO BE GIVEN TO TRUSTEE. The Trustee, subject to the provisions of Sections 7.1 and 7.2, may receive an Officers' Certificate and an Opinion of Counsel as conclusive evidence that any supplemental indenture executed pursuant to this Article Nine complies with the applicable provisions of this Indenture. SECTION 9.5. NOTATION ON SECURITIES IN RESPECT OF SUPPLEMENTAL INDENTURES. Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to the provisions of this Article may bear a notation in form approved by the Trustee for such series as to any matter provided for by such supplemental indenture or as to any action taken at any such meeting. If the Issuer, the Guarantor or the Trustee shall so determine, new Securities of any series so modified as to conform, in the opinion of the Trustee and the Board of Directors of the Issuer and the Board of Directors of the Guarantor, to any modification of this Indenture contained in any such supplemental indenture may be prepared by the Issuer, shall have the Guarantees endorsed thereon, shall be authenticated by the Trustee and delivered in exchange for the Securities of such series then outstanding. SECTION 9.6 SUBORDINATION UNIMPAIRED. No provision in any supplemental indenture that affects the 52 61 superior position of the holders of Senior Indebtedness shall be effective against holders of Senior Indebtedness. ARTICLE 10 CONSOLIDATION, MERGER, SALE OR CONVEYANCE SECTION 10.1. ISSUER MAY CONSOLIDATE, ETC., ON CERTAIN TERMS. (a) The Issuer covenants that it will not merge into or consolidate with any other Person, or sell, convey or lease all or substantially all of its assets to any Person, and the Issuer shall not permit any Person to consolidate with or merge into the Issuer or sell, convey or lease all or substantially all of its assets to the Issuer unless (i) either (A) the Issuer shall be the continuing corporation, or (B) the successor Person (which may be the Guarantor), or the Person which acquires by sale, conveyance or lease all or substantially all the assets of the Issuer shall be a corporation organized under the laws of the United States of America or any State thereof and shall expressly assume the due and punctual payment of the principal of and interest on all the Securities, according to their tenor, and the due and punctual performance and observance of all of the covenants and conditions of this Indenture to be performed or observed by the Issuer, including without limitation, the conversion rights, if any, shall be provided for in accordance with Article Fourteen, by supplemental indenture satisfactory to the Trustee, executed and delivered to the Trustee by such corporation, (ii) if such successor corporation is not the Guarantor, the Guarantor shall unconditionally guarantee any amounts payable pursuant to obligations assumed under subclause 10.1(a)(i)(B) above and (iii) the Issuer or such successor corporation, as the case may be, shall not, immediately after such merger or consolidation, or such sale, conveyance or lease be in default in the performance of any such covenant or condition. (b) The Guarantor, or any wholly-owned subsidiary of the Guarantor, may, without merging or consolidating with or acquiring all or substantially all of the assets of the Issuer, assume the due and punctual payment of the principal of (including any amount in respect of original issue discount), and any interest on all the Securities, according to the tenor, and the due and punctual performance of all of the covenants and obligations of the Issuer under the Securities and, by supplemental indenture satisfactory to the Trustee, executed and delivered to the Trustee by the Guarantor, provided that (I) if such successor Person is not the Guarantor, the Guarantor shall unconditionally guarantee 53 62 any amounts payable pursuant to obligations assumed under clause 10.1(b), (II) the Trustee shall have received the documentation required by this Section 10.1(b) and (III) such successor corporation shall not, immediately after such assumption, be in default in the performance of any covenants or obligations of the Issuer under the Securities of this Indenture. SECTION 10.2. SUCCESSOR CORPORATION SUBSTITUTED. In case of any such consolidation, merger, sale or conveyance, and following such an assumption by the successor corporation, such successor corporation shall succeed to and be substituted for the Issuer, with the same effect as if it had been named herein. Such successor corporation may cause to be signed, and may issue either in its own name or in the name of the Issuer prior to such succession any or all of the Securities issuable hereunder which theretofore shall not have been signed by the Issuer and delivered to the Trustee; and, upon the order of such successor corporation instead of the Issuer and subject to all the terms, conditions and limitations in this Indenture prescribed, the Trustee shall authenticate and shall deliver any Securities which previously shall have been signed and delivered by the officers of the Issuer to the Trustee for authentication, having the Guarantees endorsed thereon and any Securities which such successor corporation thereafter shall cause to be signed and delivered, with the Guarantees of the Guarantor endorsed thereon, to the Trustee for that purpose. All of the Securities so issued shall in all respects have the same legal rank and benefit under this Indenture as the Securities theretofore or thereafter issued in accordance with the terms of this Indenture as though all of such Securities had been issued at the date of the execution hereof. In case of any such consolidation, merger, sale, lease or conveyance such changes in phraseology and form (but not in substance) may be made in the Securities thereafter to be issued as may be appropriate. In the event of any such sale or conveyance (other than a conveyance by way of lease) and the assumption of the obligations and covenants under the Securities and this Indenture in accordance with Section 10.1 the Issuer shall be discharged from all obligations and covenants under this Indenture and the Securities and the Issuer may be liquidated and dissolved. SECTION 10.3. MERGER, CONSOLIDATION OR SALE OF ASSETS BY THE GUARANTOR. The Guarantor covenants that it will not merge into or consolidate with any other Person or 54 63 sell, convey or lease all or substantially all of its assets to any Person and the Guarantor shall not permit any Person to consolidate with or merge into the Guarantor or sell, convey or lease all or substantially all of its assets to the Guarantor unless (i) either the Guarantor shall be the continuing corporation, or the successor Person (if other than the Guarantor) shall be a corporation organized under the laws of the United States of America or any State thereof and shall expressly assume the due and punctual performance of the Guarantees, and the due and punctual performance and observance of all of the covenants and conditions of this Indenture and the Securities and the Guarantee to be performed by the Guarantor and the conversion rights, if any, shall be provided for in accordance with Article Fourteen, by supplemental indenture satisfactory to the Trustee, executed and delivered to the Trustee by such corporation, and (ii) the Guarantor or such successor corporation, as the case may be, shall not, immediately after such merger or consolidation, or such sale, conveyance or lease, be in default in the performance of any such covenant or condition. SECTION 10.4. SUCCESSOR CORPORATION TO THE GUARANTOR. In the case of any merger, consolidation, sale or conveyance and upon any assumption of the obligations and covenants under the Guarantees and this Indenture by the successor corporation as provided in Section 10.3, such successor corporation shall succeed to and be substituted for the Guarantor, with the same effect as if it had been named herein and in each of the Guarantees endorsed upon the Securities as the Guarantor, the Guarantor shall thereupon be relieved of any further obligation or liability hereunder or upon the Securities; the Guarantor as the predecessor corporation may thereupon or at any time thereafter be dissolved, wound up or liquidated; and such changes in phraseology and form (but not in substance) may be made in the Guarantees endorsed on the Securities thereafter to be issued as may be appropriate. SECTION 10.5. OPINION OF COUNSEL TO TRUSTEE. The Trustee, subject to the provisions of Sections 7.1 and 7.2, may receive an Opinion of Counsel, prepared in accordance with Section 12.5, as conclusive evidence that any such consolidation, merger, sale, lease or conveyance, and any such assumption, and any such liquidation or dissolution, complies with the applicable provisions of this Indenture. 55 64 ARTICLE 11 SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS SECTION 11.1. SATISFACTION AND DISCHARGE OF INDENTURE. If at any time (a) the Issuer or Guarantor shall have paid or caused to be paid the principal of and interest on all the Securities of any series outstanding hereunder (other than Securities which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 2.9) as and when the same shall have become due and payable, or (b) the Issuer or Guarantor shall have delivered to the Trustee for cancellation all Securities of any series theretofore authenticated (other than any Securities of such series which shall have been destroyed, lost or stolen and which shall have been replaced or paid as provided in Section 2.9) or (c) (i) all the Securities of such series not theretofore delivered to the Trustee for cancellation shall have become due and payable, or are by their terms to become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption, and (ii) the Issuer or Guarantor shall have irrevocably deposited or caused to be deposited with the Trustee as trust funds the entire amount in cash (other than moneys repaid by the Trustee or any paying agent to the Issuer in accordance with Section 11.4) or direct obligations of the United States of America, backed by its full faith and credit ("Government Obligations"), maturing as to principal and interest in such amounts and at such times as will insure the availability of cash sufficient to pay at maturity or upon redemption all Securities of such series (other than any Securities of such series which shall have been destroyed, lost or stolen and which shall have been replaced or paid as provided in Section 2.9) not theretofore delivered to the Trustee for cancellation, including principal and interest due or to become due to such date of maturity as the case may be, and if, in any such case, the Issuer shall also pay or cause to be paid all other sums payable hereunder by the Issuer with respect to Securities of such series, then this Indenture shall cease to be of further effect with respect to Securities of such series (except as to (i) rights of registration of transfer and exchange, and the Issuer's right of optional redemption, (ii) substitution of mutilated, defaced, destroyed, lost or stolen Securities, (iii) rights of holders to receive payments of principal thereof and interest thereon upon the original stated due dates thereof (but not upon acceleration), and remaining rights of the holders to receive mandatory sinking fund payments, if any, (iv) the 56 65 rights, obligations and immunities of the Trustee hereunder and (v) the rights of the Securityholders of such series as beneficiaries hereof with respect to the property so deposited with the Trustee payable to all or any of them), and the Trustee, on demand of the Issuer accompanied by an Officers' Certificate and an Opinion of Counsel and at the cost and expense of the Issuer, shall execute proper instruments acknowledging such satisfaction of and discharging this Indenture with respect to such series; provided, that the rights of Holders of the Securities to receive amounts in respect of principal of and interest on the Securities held by them shall not be delayed longer than required by then-applicable mandatory rules or policies of any securities exchange upon which the Securities are listed. Each of the Issuer and the Guarantor agrees to reimburse the Trustee for any costs or expenses thereafter reasonably and properly incurred and to compensate the Trustee for any services thereafter reasonably and properly rendered by the Trustee in connection with this Indenture or the Securities of such series. SECTION 11.2. APPLICATION BY TRUSTEE OF FUNDS DEPOSITED FOR PAYMENT OF SECURITIES. Subject to Section 11.4, all moneys deposited with the Trustee pursuant to Section 11.1 shall be held in trust and applied by it to the payment, either directly or through any paying agent (including the Issuer acting as its own paying agent), to the Holders of the particular Securities of such series for the payment or redemption of which such moneys have been deposited with the Trustee, of all sums due and to become due thereon for principal and interest; but such money need not be segregated from other funds except to the extent required by law. SECTION 11.3. REPAYMENT OF MONEYS HELD BY PAYING AGENT. In connection with the satisfaction and discharge of this Indenture with respect to Securities of any series, all moneys then held by any paying agent under the provisions of this Indenture with respect to such series of Securities shall, upon demand of the Issuer, be repaid to it or paid to the Trustee and thereupon such paying agent shall be released from all further liability with respect to such moneys. SECTION 11.4. RETURN OF MONEYS HELD BY TRUSTEE AND PAYING AGENT UNCLAIMED FOR THREE YEARS. Any moneys or government obligations deposited with or paid to the Trustee or any paying agent for the payment of the principal of or interest on any Security of any series and not applied but remaining unclaimed for three years after the date upon which such principal or interest shall have become due and 57 66 payable, shall, upon the written request of the Issuer and unless otherwise required by mandatory provisions of applicable escheat or abandoned or unclaimed property law, be repaid to the Issuer by the Trustee for such series or such paying agent, and the Holder of the Security of such series shall, unless otherwise required by mandatory provisions of applicable escheat or abandoned or unclaimed property laws, thereafter look only to the Issuer for any payment which such Holder may be entitled to collect, and all liability of the Trustee or any paying agent with respect to such moneys shall thereupon cease. ARTICLE 12 MISCELLANEOUS PROVISIONS SECTION 12.1. INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS OF ISSUER AND GUARANTOR EXEMPT FROM INDIVIDUAL LIABILITY. No recourse under or upon any obligation, covenant or agreement contained in this Indenture, or in any Security, or in any Guarantee, or because of any indebtedness evidenced thereby, shall be had against any incorporator, as such or against any past, present or future stockholder, officer or director, as such, of the Issuer or Guarantor or of any successor of either of them, either directly or through the Issuer or Guarantor or any successor of either of them, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of the Securities by the holders thereof and as part of the consideration for the issue of the Securities. SECTION 12.2. PROVISIONS OF INDENTURE FOR THE SOLE BENEFIT OF PARTIES AND SECURITYHOLDERS. Nothing in this Indenture, the Guarantees or in the Securities, expressed or implied, shall give or be construed to give to any person, firm or corporation, other than the parties hereto and their successors and the Holders of the Securities, any legal or equitable right, remedy or claim under this Indenture, or the Guarantees or under any covenant or provision herein contained, all such covenants and provisions being for the sole benefit of the parties hereto and their successors and of the Holders of the Securities. SECTION 12.3. SUCCESSORS AND ASSIGNS OF ISSUER AND GUARANTOR BOUND BY INDENTURE. All the covenants, stipulations, promises and agreements in this Indenture 58 67 contained by or in behalf of the Issuer or Guarantor shall bind its successors and assigns, whether so expressed or not. SECTION 12.4. NOTICES AND DEMANDS ON ISSUER, GUARANTOR, TRUSTEE AND SECURITYHOLDERS. Any notice or demand which by any provision of this Indenture is required or permitted to be given or served by the Trustee or by the Holders of Securities to or on the Issuer, in the case of the Issuer, may be given or served by being deposited postage prepaid, first-class mail (except as otherwise specifically provided herein), in the case of the Issuer, addressed (until another address of the Issuer is filed by the Issuer with the Trustee) to Chubb Capital Corporation 15 Mountain View Road, P. O. Box 1615, Warren, NJ 07061-1615 Attn: Treasurer, with a copy to the Guarantor to the attention of its Treasurer, and, in the case of the Guarantor, addressed (until another address of the Guarantor is filed by the Guarantor with the Trustee) to The Chubb Corporation, Attention: Treasurer, 15 Mountain View Road, P. O. Box 1615, Warren, NJ 07061-1615. Any notice, direction, request or demand by the Issuer, the Guarantor or any Securityholder to or upon the Trustee shall be deemed to have been sufficiently given or made, for all purposes, if given or made at The First National Bank of Chicago, One First National Plaza, Chicago, IL 60670-0126, Attention: Corporate Trust Services Division. Where this Indenture provides for notice to Holders, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to each Holder entitled thereto, at the last address of the Securityholder as it appears in the Security register. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders. Where this Indenture provides for notice in any manner, such notice may be waived in writing by the person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. In case, by reason of the suspension of or irregularities in regular mail service, it shall be impracticable to mail notice to the Issuer, the Guarantor and Securityholders when such notice is required to be given pursuant to any provision of this Indenture, then any manner 59 68 of giving such notice as shall be satisfactory to the Trustee shall be deemed to be a sufficient giving of such notice. SECTION 12.5. OFFICERS' CERTIFICATES AND OPINIONS OF COUNSEL; STATEMENTS TO BE CONTAINED THEREIN. Upon any application or demand by the Issuer or the Guarantor to the Trustee to take any action under any of the provisions of this Indenture, the Issuer or the Guarantor, as the case may be, shall furnish to the Trustee an Officers' Certificate stating that all conditions precedent provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent have been complied with, except that in the case of any such application or demand as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or demand, no additional certificate or opinion need be furnished. Each certificate or opinion provided for in this Indenture and delivered to the Trustee with respect to compliance with a condition or covenant provided for in this Indenture shall include (a) a statement that the person making such certificate or opinion has read such covenant or condition, (b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based, (c) a statement that, in the opinion of such person, he or she has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with and (d) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with. Any certificate, statement or opinion of an officer of the Issuer or the Guarantor, as the case may be, may be based, insofar as it relates to legal matters, upon a certificate or opinion of or representations by counsel, unless such officer knows that the certificate or opinion or representations with respect to the matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any certificate, statement or opinion of counsel may be based, insofar as it relates to factual matters, information with respect to which is in the possession of the Issuer or the Guarantor, as the case may be, upon the certificate, statement or opinion of or representations by an officer or officers of the Issuer or the Guarantor, as the case may be, unless such 60 69 counsel knows that the certificate, statement or opinion or representations with respect to the matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any certificate, statement or opinion of an officer of the Issuer or the Guarantor, as the case may be, or of counsel may be based, insofar as it relates to accounting matters, upon a certificate or opinion of or representations by an accountant or firm of accountants in the employ of the Issuer or the Guarantor, as the case may be, unless such officer or counsel, as the case may be, knows that the certificate or opinion or representations with respect to the accounting matters upon which his certificate, statement or opinion may be based as aforesaid are erroneous, or in the exercise of reasonable care should know that the same are erroneous. Any certificate or opinion of any independent firm of public accountants filed with the Trustee shall contain a statement that such firm is independent. SECTION 12.6. PAYMENTS DUE ON SATURDAYS, SUNDAYS AND HOLIDAYS. If the date of maturity of interest on or principal of the Securities of any series or the date fixed for redemption or repayment of any such Security or the last day on which a Holder has the right to convert a Security at a particular conversion price shall not be a Business Day, then payment of interest or principal, or any conversion need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on the date of maturity or the date fixed for redemption, and no interest shall accrue for the period after such date. SECTION 12.7. CONFLICT OF ANY PROVISION OF INDENTURE WITH TRUST INDENTURE ACT OF 1939. If and to the extent that any provision of this Indenture limits, qualifies or conflicts with another provision included in this Indenture by operation of Sections 310 to 318, inclusive, of the Trust Indenture Act of 1939 (an "incorporated" provision), such incorporated provision shall control. SECTION 12.8. NEW YORK LAW TO GOVERN. This Indenture, each Security and each Guarantee shall be deemed to be a contract under the laws of the State of New York, and for all purposes shall be construed in accordance with the laws of such State. 61 70 SECTION 12.9. COUNTERPARTS. This Indenture may be executed in any number of counterparts, each of which shall be an original; but such counterparts shall together constitute but one and the same instrument. SECTION 12.10. EFFECT OF HEADINGS. The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. ARTICLE 13 REDEMPTION OF SECURITIES AND SINKING FUNDS SECTION 13.1. APPLICABILITY OF ARTICLE. The provisions of this Article shall be applicable to the Securities of any series which are redeemable before their maturity or to any sinking fund for the retirement of Securities of a series except as otherwise specified as contemplated by Section 2.3 for Securities of such series. SECTION 13.2. NOTICE OF REDEMPTION; PARTIAL REDEMPTIONS. Notice of redemption to the Holders of Securities of any series to be redeemed as a whole or in part at the option of the Issuer shall be given by mailing notice of such redemption by first class mail, postage prepaid, at least 30 days and not more than 60 days prior to the date fixed for redemption to such Holders of Securities of such series at their last addresses as they shall appear upon the registry books. Any notice which is mailed in the manner herein provided shall be conclusively presumed to have been duly given, whether or not the Holder receives the notice. Failure to give notice by mail, or any defect in the notice to the Holder of any Security of a series designated for redemption as a whole or in part shall not affect the validity of the proceedings for the redemption of any other Security of such series. The notice of redemption to each such Holder shall specify (i) the principal amount of each Security of such series held by such Holder to be redeemed, (ii) the date fixed for redemption, (iii) the redemption price, (iv) the place or places of payment, (v) that payment will be made upon presentation and surrender of such Securities, (vi) that such redemption is pursuant to the mandatory or optional sinking fund, or both, if such be the case, (vii) that interest accrued to the date fixed for redemption will be paid as specified in such notice and that on and after said date interest thereon or on the portions thereof to be redeemed will cease to accrue and (viii) if applicable, the 62 71 conversion price, and that the date on which the right to convert the principal of the Securities or the portions thereof to be redeemed will terminate will be the date fixed for redemption and the place or places where such Securities may be surrendered for conversion. In case any Security of a series is to be redeemed in part only the notice of redemption shall state the portion of the principal amount thereof to be redeemed and shall state that on and after the date fixed for redemption, upon surrender of such Security, a new Security or Securities of such series in any authorized denomination and in principal amount equal to the unredeemed portion thereof will be issued. The notice of redemption of Securities of any series to be redeemed at the option of the Issuer shall be given by the Issuer or, at the Issuer's request, by the Trustee in the name and at the expense of the Issuer. At least one Business Day prior to the redemption date specified in the notice of redemption given as provided in this Section, the Issuer will deposit with the Trustee or with one or more paying agents (or, if the Issuer is acting as its own paying agent, set aside, segregate and hold in trust as provided in Section 4.4) an amount of money sufficient to redeem on the redemption date all the Securities of such series so called for redemption at the appropriate redemption price, together with accrued interest to the date fixed for redemption, other than any Securities called for redemption on that date which have been converted prior to the date of such deposit. If less than all the outstanding Securities of a series are to be redeemed, the Issuer will deliver to the Trustee at least 70 days prior to the date fixed for redemption an Officers' Certificate stating the aggregate principal amount of Securities to be redeemed. If any Security or portion thereof called for redemption is converted, any money deposited with the Trustee or with any paying agent or so segregated and held in trust for the redemption of such Security or portion thereof shall (subject to any right of the Holder of such Security or any predecessor Security to receive interest as provided in the last paragraph of Section 2.7) be paid to the Issuer upon Issuer request or, if then held by the Issuer, shall be discharged from such trust. If less than all the Securities of a series are to be redeemed, the Trustee shall select, in the manner specified in such Securities or specified pursuant to Section 2.3, or, if no manner is specified in the Securities or pursuant to Section 2.3, then in such manner as it shall 63 72 deem appropriate and fair, Securities of such Series to be redeemed in whole or in part. Securities may be redeemed in part in an amount equal to any authorized denomination for Securities of such series. If any Security selected for partial redemption is converted in part before termination of the conversion right with respect to the portion of the Security so selected, the converted portion of such Security shall be deemed (so far as may be) to be the portion selected for redemption. Securities which have been converted during a selection of Securities to be redeemed shall be treated by the Trustee as Outstanding for the purpose of such selection. The Trustee shall promptly notify the Issuer in writing of the Securities of such series selected for redemption and, in the case of any Securities of such series selected for partial redemption, the principal amount thereof to be redeemed. For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities of any series shall relate, in the case of any Security redeemed or to be redeemed only in part, to the portion of the principal amount of such Security which has been or is to be redeemed. SECTION 13.3. PAYMENT OF SECURITIES CALLED FOR REDEMPTION. If notice of redemption has been given as above provided, the Securities or portions of Securities specified in such notice shall become due and payable on the date and at the place stated in such notice at the applicable redemption price, together with interest accrued to the date fixed for redemption, and on and after said date (unless the Issuer shall default in the payment of such Securities at the redemption price, together with interest accrued to said date) interest on the Securities or portions of Securities so called for redemption shall cease to accrue and, except as provided in Sections 7.5 and 11.4, such Securities shall cease from and after the date fixed for redemption to be entitled to any benefit or security under this Indenture, and the Holders thereof shall have no right in respect of such Securities except the right to receive the redemption price thereof and unpaid interest to the date fixed for redemption. On presentation and surrender of such Securities at a place of payment specified in said notice, said Securities or the specified portions thereof shall be paid and redeemed by the Issuer at the applicable redemption price, together with interest accrued thereon to the date fixed for redemption; provided that any installment of interest becoming due on or prior to the date fixed for redemption shall be payable to the Holders of such Securities registered as such on the relevant record date subject to the terms and provisions of Section 2.4 hereof. 64 73 If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal shall, until paid or duly provided for, bear interest from the date fixed for redemption at the rate of interest or Yield to Maturity (in the case of an Original Issue Discount Security) borne by the Security. Upon presentation of any Security redeemed in part only, the Issuer shall execute and the Trustee shall authenticate and deliver to or on the order of the Holder thereof, at the expense of the Issuer, a new Security or Securities of such series , of authorized denominations, in principal amount equal to the unredeemed portion of the Security so presented. SECTION 13.4. EXCLUSION OF CERTAIN SECURITIES FROM ELIGIBILITY FOR SELECTION FOR REDEMPTION. If this Section has been specified in accordance with Section 2.3 to be applicable to the Securities of any series, then Securities of such series shall be excluded from eligibility for selection for redemption if they are identified by registration and certificate number in a written statement signed by an authorized officer of the Issuer and delivered to the Trustee at least 40 days prior to the last date on which notice of redemption may be given as being owned of record and beneficially by, and not pledged or hypothecated by either (a) the Issuer, (b) the Guarantor or (c) an entity specifically identified in such written statement directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer or the Guarantor. SECTION 13.5. MANDATORY AND OPTIONAL SINKING FUNDS. 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". The date on which a sinking fund payment is to be made is herein referred to as the "sinking fund payment date". If this paragraph has been specified in accordance with Section 2.3 to be applicable to the Securities of any series, then in lieu of making all or any part of any mandatory sinking fund payment with respect to any series of Securities in cash, the Issuer may at its option (a) deliver to the Trustee Securities of such series theretofore purchased or otherwise acquired (except upon redemption pursuant to the mandatory sinking fund) by the Issuer or receive credit for Securities of such series (not previously so credited) theretofore purchased or otherwise acquired 65 74 (except as aforesaid) by the Issuer and delivered to the Trustee for cancellation pursuant to Section 2.7, (b) receive credit for Securities of a series which have been converted pursuant to Article Fourteen, (c) receive credit for optional sinking fund payments (not previously so credited) made pursuant to this Section, or (d) receive credit for Securities of such series (not previously so credited) redeemed by the Issuer through any optional redemption provision contained in the terms of such series. Securities so delivered or credited shall be received or credited by the Trustee at the sinking fund redemption price specified in such Securities. Unless this paragraph has been specified in accordance with Section 2.3 to be inapplicable to the Securities of any series, an amount equal to 20% of the aggregate principal amount of Securities of any series that have been repurchased by the Issuer and canceled by the Trustee or delivered to the Trustee for cancellation shall be credited (without crediting any portion of such Securities more than once with respect to any particular sinking fund payment) against, and shall thereby reduce, the aggregate amount of the next succeeding and each subsequent sinking fund payment required to be made with respect to Securities of such series. On or before the sixtieth day next preceding each sinking fund payment date for any series, the Issuer will deliver to the Trustee a written statement (which need not contain the statements required by Section 12.5) signed by an authorized officer of the Issuer (a) specifying the portion of the mandatory sinking fund payment to be satisfied by payment of cash and the portion to be satisfied by credit of Securities of such series, (b) stating that none of such Securities of such series has theretofore been so credited, (c) stating that no defaults in the payment of interest or Events of Default with respect to such series have occurred (which have not been waived or cured) and are continuing and (d) stating whether or not the Issuer intends to exercise its right to make an optional sinking fund payment with respect to such series and, if so, specifying the amount of such optional sinking fund payment which the Issuer intends to pay on or before the next succeeding sinking fund payment date. Any Securities of such series to be credited and required to be delivered to the Trustee in order for the Issuer to be entitled to credit therefor as aforesaid which have not theretofore been delivered to the Trustee shall be delivered for cancellation pursuant to Section 2.10 to the Trustee with such written statement (or reasonably promptly thereafter if acceptable to the Trustee). Such written statement shall be irrevocable and 66 75 upon its receipt by the Trustee the Issuer shall become unconditionally obligated to make all the cash payments therein referred to, if any, on or before the next succeeding sinking fund payment date. Failure of the Issuer, on or before any such sixtieth day, to deliver such written statement and Securities specified in this paragraph, if any, shall not constitute a default but shall constitute, on and as of such date, the irrevocable election of the Issuer (i) that the mandatory sinking fund payment for such series due on the next succeeding sinking fund payment date shall be paid entirely in cash without the option to deliver or credit Securities of such series in respect thereof and (ii) that the Issuer will make no optional sinking fund payment with respect to such series as provided in this Section. If the sinking fund payment or payments (mandatory or optional or both) to be made in cash on the next succeeding sinking fund payment date plus any unused balance of any preceding sinking fund payments made in cash shall exceed $50,000 (or a lesser sum if the Issuer shall so request) with respect to the Securities of any particular series, such cash shall be applied on the next succeeding sinking fund payment date to the redemption of Securities of such series at the sinking fund redemption price together with accrued interest to the date fixed for redemption. If such amount shall be $50,000 or less and the Issuer makes no such request then it shall be carried over until a sum in excess of $50,000 is available. The Trustee shall select, in the manner provided in Section 13.2, for redemption on such sinking fund payment date a sufficient principal amount of Securities of such series to absorb said cash, as nearly as may be, shall (if requested in writing by the Issuer) inform the Issuer of the serial numbers of the Securities of such series (or portions thereof) so selected. Securities of any series which are (a) owned by the Issuer or the Guarantor or an entity known by the Trustee to be directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer or the Guarantor, as shown by the Security register, and not known to the Trustee to have been pledged or hypothecated by the Issuer or any such entity or (b) identified in an Officers' Certificate at least 60 days prior to the sinking fund payment date as being beneficially owned by, and not pledged or hypothecated by, the Issuer or the Guarantor or an entity directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer or the Guarantor shall be excluded from Securities of such series eligible for selection for redemption. The Trustee, in the name and at the expense of the Issuer (or the Issuer, if it shall so request the Trustee in writing) shall cause notice 67 76 of redemption of the Securities of such series to be given in substantially the manner provided in Section 13.2 (and with the effect provided in Section 13.3) for the redemption of Securities of such series in part at the option of the Issuer. The amount of any sinking fund payments not so applied or allocated to the redemption of Securities of such series shall be added to the next cash sinking fund payment for such series and, together with such payment, shall be applied in accordance with the provisions of this Section. Any and all sinking fund moneys held on the stated maturity date of the Securities of any particular series (or earlier, if such maturity is accelerated), which are not held for the payment or redemption of particular Securities of such series shall be applied, together with other moneys, if necessary, sufficient for the purpose, to the payment of the principal of, and interest on, the Securities of such series at maturity. At least one Business Day before each sinking fund payment date, the Issuer shall pay to the Trustee in cash or shall otherwise provide for the payment of all interest accrued to the date fixed for redemption on Securities to be redeemed on the next following sinking fund payment date. The Trustee shall not redeem or cause to be redeemed any Securities of a series with sinking fund moneys or mail any notice of redemption of Securities for such series by operation of the sinking fund during the continuance of a default in payment of interest on such Securities or of any Event of Default except that, where the mailing of notice of redemption of any Securities shall theretofore have been made, the Trustee shall redeem or cause to be redeemed such Securities, provided that it shall have received from the Issuer a sum sufficient for such redemption. Except as aforesaid, any moneys in the sinking fund for such series at the time when any such default or Event of Default shall occur, and any moneys thereafter paid into the sinking fund, shall, during the continuance of such default or Event of Default, be deemed to have been collected under Article Six and held for the payment of all such Securities. In case such Event of Default shall have been waived as provided in Section 6.10 or the default cured on or before the sixtieth day preceding the sinking fund payment date in any year, such moneys shall thereafter be applied on the next succeeding sinking fund payment date in accordance with this Section to the redemption of such Securities. 68 77 ARTICLE 14 CONVERSION OF SECURITIES SECTION 14.1. APPLICABILITY OF ARTICLE. The provisions of this Article shall be applicable to the Securities of any series which are convertible into shares of Common Stock of the Guarantor, and the issuance of such shares of Common Stock upon the conversion of such Securities, except as otherwise specified as contemplated by Section 2.3 for the Securities of such series. SECTION 14.2. EXERCISE OF CONVERSION PRIVILEGE. In order to exercise a conversion privilege, the Holder of a Security of a series with such a privilege shall surrender such Security to the Issuer at the office or agency maintained for that purpose, accompanied by written notice, in the form set forth in or prescribed by such Security, to the Issuer that the Holder elects to convert such Security or a specified portion thereof. Such notice shall also state, if different from the name and address of such Holder, the name or names (with address)in which the certificate or certificates for shares of Common Stock which shall be issuable on such conversion shall be issued. Securities surrendered for conversion shall (if so required by the Issuer or the Trustee) be duly endorsed by or accompanied by instruments of transfer in forms satisfactory to the Issuer and the Trustee duly executed by the registered Holder or its attorney duly authorized in writing; and Securities so surrendered for conversion during the period from the close of business on any record date to the opening of business on the next succeeding interest payment date (excluding Securities or portions thereof called for redemption during such period) shall also be accompanied by payment in funds acceptable to the Issuer of an amount equal to the interest payable on such interest payment date on the principal amount of such Security then being converted, and such interest shall be payable to such registered Holder notwithstanding the conversion of such Security, subject to the provisions of Section 2.7 relating to the payment of defaulted interest by the Issuer. As promptly as practicable after the receipt of such notice and of any payment required pursuant to a Board Resolution and, subject to Section 2.4, set forth, or determined in the manner provided, in an Officers' Certificate, or established in one or more indentures supplemental hereto setting forth the terms of such series of Security, and the surrender of such Security in accordance with such reasonable regulations as the Issuer may prescribe, the Issuer shall issue and shall deliver, at the office or agency at which such Security is surrendered, to such Holder or on its written order, a certificate or certificates for the number of full shares of Common Stock issuable upon the conversion of such 69 78 Security (or specified portion thereof), in accordance with the provisions of such Board Resolution, Officers' Certificate or supplemental indenture, and cash as provided therein in respect of any fractional share of such Common Stock otherwise issuable upon such conversion. Such conversion shall be deemed to have been effected immediately prior to the close of business on the date on which such notice and such payment, if required, shall have been received in proper order for conversion by the Issuer and such Security shall have been surrendered as aforesaid (unless such Holder shall have so surrendered such Security and shall have instructed the Issuer to effect the conversion on a particular date following such surrender and such Holder shall be entitled to convert such Security on such date, in which case such conversion shall be deemed to be effected immediately prior to the close of business on such date) and at such time the rights of the Holder of such Security as such Security Holder shall cease and the person or persons in whose name or names any certificate or certificates for shares of Common Stock of the Guarantor shall be issuable upon such conversion shall be deemed to have become the Holder or Holders of record of the shares represented thereby. Except as set forth above and subject to the final paragraph of Section 2.7, no payment or adjustment shall be made upon any conversion on account of any interest accrued on the Securities surrendered for conversion or on account of any dividends on the Common Stock of the Guarantor issued upon such conversion. In the case of any Security which is converted in part only, upon such conversion the Issuer shall execute and the Trustee shall authenticate and deliver to or on the order of the Holder thereof, at the expense of the Issuer, a new Security or Securities of the same series, of authorized denominations, in aggregate principal amount equal to the unconverted portion of such Security. SECTION 14.3. NO FRACTIONAL SHARES. No fractional share of Common Stock of the Guarantor shall be issued upon conversions of Securities of any series. If more than one Security shall be surrendered for conversion at one time by the same Holder, the number of full shares which shall be issuable upon conversion shall be computed by the Guarantor on the basis of the aggregate principal amount of the Securities (or specified portions thereof to the extent permitted hereby) so surrendered. If, except for the provisions of this Section 14.3, any Holder of a Security or Securities would be entitled to a fractional share of Common Stock of the Guarantor upon the conversion of such Security or Securities, or specified portions thereof, the Issuer shall pay to such Holder an amount in cash equal to the 70 79 current market value of such fractional share computed, (i) if such Common Stock is listed or admitted to unlisted trading privileges on a national securities exchange, on the basis of the last reported sale price regular way on such exchange on the last trading day prior to the date of conversion upon which such a sale shall have been effected, or (ii) if such Common Stock is not at the time so listed or admitted to unlisted trading privileges on a national securities exchange, on the basis of the average of the bid and asked prices of such Common Stock in the over-the-counter market, on the last trading day prior to the date of conversion, as reported by the National Association of Securities Dealers Automated Quotation System, or if not so available, the fair market price as determined by the Board of Directors. For purposes of this Section, "trading day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday other than any day on which the Common Stock is not traded on the New York Stock Exchange, or if the Common Stock is not traded on the New York Stock Exchange, on the principal exchange or market on which the Common Stock is traded or quoted. The Trustee shall not have any responsibility with respect to the computation of the Conversion Price, and may conclusively rely upon the Issuer's determination thereof. SECTION 14.4. ADJUSTMENT OF CONVERSION PRICE. The Conversion Price in effect at any time shall be subject to adjustment as follows: (a) In case the Guarantor shall (i) pay a dividend in or make a distribution of shares of its capital stock (whether shares of Common Stock or of capital stock of any other class), (ii) subdivide its outstanding shares of Common Stock, (iii) combine its outstanding shares of Common Stock into a smaller number of shares or (iv) issue by reclassification of its shares of Common Stock any shares of capital stock of the Guarantor, the conversion price in effect immediately prior to such action shall be adjusted by the Guarantor so that the holder of any Security thereafter surrendered for conversion shall be entitled to receive the number of shares of capital stock of the Guarantor which he would have owned or been entitled to receive immediately following such action had such Security been exchanged immediately prior thereto. An adjustment made pursuant to this paragraph (a) shall become effective retroactively immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification. If, as a result of an adjustment made pursuant to this paragraph (a), the holder of any Security thereafter surrendered for conversion shall become entitled 71 80 to receive shares of two or more classes of capital stock of the Guarantor, the Board of Directors (whose determination shall be conclusive) shall determine the allocation of the adjusted exchange price between or among shares of such classes of capital stock. (b) In case the Guarantor shall issue rights or warrants to all holders of its Common Stock entitling them (for a period expiring within 45 days after the record date mentioned below) to subscribe for or purchase shares of Common Stock at a price per share less than the then current market price per share (as determined pursuant to paragraph (d) below) on the record date mentioned below, the conversion price of the Common Stock shall be adjusted so that the same shall equal the price determined by multiplying the conversion price in effect immediately prior to the date of issuance of such rights or warrants by a fraction of which the numerator shall be the number of shares of Common Stock outstanding on the date of issuance of such rights or warrants plus the number of shares of Common Stock which the aggregate offering price of the total number of shares of Common Stock so offered would purchase at such current market price and of which the denominator shall be the number of shares of Common Stock outstanding on the date of issuance of such rights or warrants plus the number of additional shares of Common Stock offered for subscription or purchase. Such adjustment shall become effective retroactively immediately after the record date for the determination of stockholders entitled to receive such rights or warrants. (c) In case the Guarantor shall distribute to all holders of its Common Stock evidences of its indebtedness or assets (excluding any cash dividend paid from retained earnings of the Issuer) or rights or warrants to subscribe to securities of the Guarantor (excluding those referred to in paragraph (b) above), then in each such case the conversion price shall be adjusted so that the same shall equal the price determined by multiplying the conversion price in effect immediately prior to the date of such distribution by a fraction of which the numerator shall be the current market price per share (determined as provided in paragraph (d) below) of Common Stock less the then fair market value (as determined by the Board of Directors of the Guarantor, whose determination shall be conclusive) of the portion of the assets or evidences of indebtedness so distributed or of such subscription rights or warrants applicable to one share of Common Stock, and of which the denominator shall be such current market price per share of the Common Stock on the record date mentioned below. Such adjustment shall become effective retroactively immediately 72 81 after the record date for the determination of stockholders entitled to receive such distribution. (d) For the purpose of any computation under paragraphs (b) and (c) above, the current market price per share of Common Stock on any date shall be deemed to be the average of the daily closing prices for 10 consecutive Business Days commencing 10 Business Days before the day in question. The closing price for each day shall be the last reported sales price regular way on the New York Stock Exchange ("NYSE"), or, if not reported for the NYSE, on the Composite Tape, or, in case no such reported sale takes place on such day, the average of the reported closing bid and asked quotations on the NYSE, or, if the Common Stock is not listed on the NYSE or no such quotations are available, the average of the high bid and low asked quotations in the over-the-counter market as reported by the National Quotation Bureau, Incorporated, or similar organization, or, if no such quotations are available, the fair market price as determined by the Guarantor (whose determination shall be conclusive). (e) In any case in which this Section 14.4 shall require that an adjustment be made retroactively immediately following a record date, the Issuer may elect to defer (but only until five Business Days following the mailing by the Issuer of the Officer's Certificate described in paragraph (j) below issuing to the holder of any share converted after such record date (i) the shares of Common Stock and other capital stock of the Guarantor issuable upon such conversion over and above (ii) the shares of Common Stock and other capital stock of the Guarantor issuable upon such conversion only on the basis of the conversion price prior to adjustment. (f) In the case of either (i) any consolidation or merger to which the Guarantor is a party, other than a consolidation or a merger in which the Guarantor is a continuing corporation and which does not result in any reclassification of, or change (other than a change in par value or from par value to no par value or from no par value to par value, or as a result of a subdivision or combination) in, outstanding shares of the Common Stock, or (ii) any sale or conveyance to another corporation of the property of the Guarantor as an entirety or substantially as an entirety, then the holder of each Outstanding Security shall have the right to exchange such Security into the kind and amount of shares of stock and other securities and property (including cash) receivable upon such consolidation, merger, sale or conveyance by a holder of the number of shares of Common Stock issuable upon conversion of 73 82 such Security immediately prior to such consolidation, merger, sale or conveyance, subject to adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 14.4 assuming, in the case of any consolidation, merger, sale or conveyance, such holder of Common Stock of the Guarantor (i) is not a Person with or into which the Guarantor consolidated or merged or which merged into the Guarantor or to which such sale or conveyance was made, as the case may be ("constituent Person"), or an Affiliate of a constituent Person and (ii) failed to exercise his rights of election, if any, as to the kind or amount of shares of stock and other securities and property (including cash) receivable upon such consolidation, merger, sale or conveyance (provided that if the kind or amount of shares of stock and other securities and property (including cash) receivable upon such consolidation, merger, sale or conveyance is not the same for each share of Common Stock of the Guarantor held immediately prior to such consolidation, merger, sale or conveyance by others than a constituent Person or an Affiliate thereof and in respect of which such rights of election shall not have been exercised ("non-electing share"), then for the purpose of this Section 13.4 the kind and amount of shares of stock and other securities and property (including cash) receivable upon such consolidation, merger, sale or conveyance by each non-electing share shall be deemed to be the kind and amount so receivable per share by a plurality of the non-electing shares). The provisions of this paragraph (f) shall similarly apply to successive consolidations, mergers, sales or conveyances. (g) No adjustment in the conversion price shall be required unless such adjustment would require an increase or decrease of at least 1% in such price; provided, however, that any adjustments which by reason of this paragraph (g) are not required to be made shall be carried forward and taken into account in any subsequent adjustment; and, provided further that adjustment shall be required and made in accordance with the provisions of this Section 14.4 (other than this paragraph (g)) not later than such time as may be required in order to preserve the tax-free nature of a distribution to the holders of shares of Common Stock. All calculations under this Section 14.4 shall be made to the nearest cent or to the nearest one-hundredth of a share, as the case may be. Anything in this Section 14.4 to the contrary notwithstanding, the Guarantor shall be permitted to make such reductions in the conversion price in addition to those required by this Section 14.4 as it in its discretion shall consider to be advisable in order that any stock dividends, subdivision of shares, distribution of 74 83 rights to purchase stock or securities, or distribution of securities convertible into or exchangeable for stock hereafter made by the Guarantor to its stockholders shall not be taxable to the holders of the Common Stock. (h) In the event that at any time as a result of an adjustment made pursuant to paragraph (a) above, the holder of any Security thereafter surrendered for conversion shall become entitled to receive any shares of the Guarantor other than shares of its Common Stock, thereafter the conversion price of such other shares so receivable upon conversion of any Security shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to Common Stock contained in paragraphs (a) through (g) above, and the provisions of Sections 14.1 through 14.3 and Sections 14.5 through 14.9 with respect to the Common Stock shall apply on like or similar terms to any such other shares. (i) Before taking any action which would cause an adjustment reducing the then equivalent conversion price to be below the then par value of the Common Stock, the Guarantor will take any corporate action which may, in the opinion of its counsel, be necessary in order that the Guarantor may validly and legally issue fully paid and non-assessable shares of Common Stock at the conversion price as so adjusted. (j) Whenever the Conversion Price is adjusted as herein provided, the Issuer shall promptly (i) file with the Trustee and each additional conversion agent, if any, an Officer's Certificate setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment, which certificate shall be conclusive evidence of the correctness of such adjustment, and (ii) mail or cause to be mailed a notice of such adjustment to each Holder of Securities at his address as the same appears on the registry books of the Issuer. Neither the Trustee nor any conversion agent shall be under any responsibility to determine the correctness of any adjustment to the Conversion Price to be made pursuant to this Section. SECTION 14.5. NOTICE OF CERTAIN CORPORATE ACTIONS. In case: (a) the Guarantor shall declare a dividend (or any other distribution) on its Common Stock (other than 75 84 dividends or distributions which will not require an adjustment of the conversion price of Securities of any series pursuant to Section 14.4); or (b) the Guarantor shall authorize the granting to the holders of its Common Stock of rights, options or warrants to subscribe for or purchase any shares of capital stock of any class or of any other rights (other than any such grant for which approval of any shareholders of the Issuer is required or which will not require an adjustment of the conversion price of Securities of any series pursuant to Section 14.4); or (c) of any reclassification of the Common Stock of the Guarantor (other than a subdivision or combination of its outstanding shares of Common Stock, or any consolidation, merger or share exchange to which the Guarantor is a party and for which approval of any shareholders of the Issuer is required or which will not require an adjustment of the conversion price of Securities of any series pursuant to Section 14.4), or of the sale of all or substantially all of the assets of the Guarantor; or (d) of the voluntary or involuntary dissolution, liquidation or winding up of the Guarantor; then the Issuer shall cause to be filed with the Trustee, and shall cause to be mailed to all Holders at their last addresses as they shall appear in the Securities Register, at least 20 days (or 10 days in any case specified in clause (a) or (b) above) prior to the applicable record date hereinafter specified, a notice stating (i) the date on which a record is to be taken for the purpose of such dividend, distribution, rights, options or warrants, or, if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such dividend, distribution, rights, options or warrants are to be determined, or (ii) the date on which such reclassification, consolidation, merger, share exchange, sale, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their shares of Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, share exchange, sale, dissolution, liquidation or winding up. If at any time the Trustee shall not be the conversion agent, a copy of such notice shall also forthwith be filed by the Issuer with the conversion agent. 76 85 SECTION 14.6. RESERVATION OF SHARES OF COMMON STOCK. The Guarantor shall at all times reserve and keep available, free from preemptive rights, out of its authorized but unissued Common Stock, for the purpose of effecting the conversion of Securities, the full number of shares of Common Stock of the Guarantor then issuable upon the conversion of all outstanding Securities of any series that have conversion rights. SECTION 14.7. PAYMENT OF CERTAIN TAXES UPON CONVERSION. The Issuer will pay any and all taxes that may be payable in respect of the issue or delivery of shares of Common Stock on conversion of Securities pursuant hereto. The Issuer shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of shares of Common Stock in a name other than that of the Holder of the Security or Securities to be converted, and no such issue or delivery shall be made unless and until the person requesting such issue has paid to the Issuer the amount of any such tax, or has established, to the satisfaction of the Issuer, that such tax has been paid. SECTION 14.8. NONASSESSABILITY. The Issuer and the Guarantor covenants that all shares of Common Stock which may be issued upon conversion of Securities will upon issue in accordance with the terms hereof be duly and validly issued and fully paid and nonassessable. SECTION 14.9. EFFECT OF CONSOLIDATION OR MERGER ON CONVERSION PRIVILEGE. In case of any consolidation of the Guarantor with, or merger of the Guarantor into or with any other Person, or in the case of a statutory share exchange to which the Guarantor is a party or in case of any sale or conveyance of all or substantially all of the properties or assets of the Guarantor (including cash), the Guarantor or the Person formed by such consolidation or the Person into which the Guarantor shall have been merged or the Person which shall have acquired such assets, or the surviving entity in such share exchange, as the case may be, shall execute and deliver to the Trustee a supplemental indenture providing that the Holder of each Security then outstanding of any series that is convertible into Common Stock of the Guarantor shall have the right, which right shall be the exclusive conversion right thereafter available to said Holder (until the expiration of the conversion right of such Security), to convert such Security into the kind and amount of shares of stock or other securities or property (including cash) receivable upon such consolidation, merger, share exchange, conveyance or sale by a holder of the number of shares of Common Stock of the 77 86 Issuer into which such Security might have been converted immediately prior to such consolidation, merger, share exchange, conveyance or sale, subject to compliance with the other provisions of this Indenture, such Security and such supplemental indenture. Such supplemental indenture shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in such Security. The above provisions of this Section shall similarly apply to successive consolidation, mergers, share exchanges, conveyances or sales. It is expressly agreed and understood that anything in this Indenture to the contrary notwithstanding, if pursuant to such merger, consolidation, share exchange, conveyance or sale, holders of outstanding shares of Common Stock of the Guarantor do not receive shares of common stock of the surviving corporation but receive other securities, cash or other property or any combination thereof, Holders of Securities shall not have the right to thereafter convert their Securities into common stock of the surviving corporation or the corporation which shall have acquired such assets, but rather, shall have the right upon such conversion to receive the other securities, cash or other property receivable by a holder of the number of shares of Common Stock of the Guarantor into which the Securities held by such holder might have been converted immediately prior to such consolidation, merger, share exchange, conveyance or sale, all as more fully provided in the first sentence of this Section 14.9. Anything in this Section 14.9 to the contrary notwithstanding, the provisions of this Section 14.9 shall not apply to a merger or consolidation of another corporation with or into the Issuer or any share exchange to which the Guarantor is a party pursuant to which both of the following conditions are applicable: (i) the Guarantor is the surviving or successor corporation and (ii) the outstanding shares of Common Stock of the Guarantor are not changed or converted into any other securities or property (including cash) or changed in number or character or reclassified pursuant to the terms of such merger, consolidation or share exchange. As evidence of the kind and amount of shares of stock or other securities or property (including cash) into which Securities may properly be convertible after any such consolidation, merger, share exchange, conveyance or sale, or as to the appropriate adjustments of the conversion prices applicable with respect thereto, the Trustee shall be furnished with and may accept the certificate or opinion of an independent certified public accountant with respect thereto; and, in the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely thereon, and shall not be responsible or accountable to any Holder of Securities for any provision in conformity therewith or 78 87 approved by such independent certified accountant which may be contained in said supplemental indenture. SECTION 14.10. DUTIES OF TRUSTEE REGARDING CONVERSION. Neither the Trustee nor any conversion agent shall at anytime be under any duty or responsibility to any Holder of Securities of any series that is convertible into Common Stock of the Guarantor to determine whether any facts exist which may require any adjustment of the conversion price, or with respect to the nature or extent of any such adjustment when made, or with respect to the method employed, whether herein or in any supplemental indenture, any resolutions of the Board of Directors or written instrument executed by one or more officers of the Guarantor provided to be employed in making the same. Neither the Trustee nor any conversion agent shall be accountable with respect to the validity or value (or the kind or amount) of any shares of Common Stock of the Guarantor, or of any securities or property, which may at any time be issued or delivered upon the conversion of any Securities and neither the Trustee nor any conversion agent makes any representation with respect thereto. Subject to the provisions of Section 7.1, neither the Trustee nor any conversion agent shall be responsible for any failure of the Guarantor to issue, transfer or deliver any shares of its Common Stock or stock certificates or other securities or property upon the surrender of any Security for the purpose of conversion or to comply with any of the covenants of the Issuer and the Guarantor contained in this Article Fourteen or in the applicable supplemental indenture, resolutions of the Board of Directors or written instrument executed by one or more duly authorized officers of the Issuer. SECTION 14.11. REPAYMENT OF CERTAIN FUNDS UPON CONVERSION. Any funds which at any time shall have been deposited by the Issuer or on its behalf with the Trustee or any other paying agent for the purpose of paying the principal of, and premium, if any, and interest, if any, on any of the Securities (including funds deposited for the sinking fund referred to in Article Thirteen hereof) and which shall not be required for such purposes because of the conversion of such Securities as provided in this Article Fourteen shall after such conversion be repaid to the Issuer by the Trustee upon the Issuer's written request. 79 88 ARTICLE 15 SUBORDINATION OF SECURITIES SECTION 15.1. SUBORDINATION OF THE SECURITIES. The Issuer covenants and agrees, and each holder of Securities, by his acceptance thereof, likewise covenants and agrees, that the indebtedness evidenced by the Securities (including coupons) and the payment of the principal thereof, premium, if any, and interest thereon shall be subordinate and subject in right of payment, to the extent and in the manner hereinafter set forth, to the prior payment in full of all Senior Indebtedness. For purposes of this Article Fifteen, "Senior Indebtedness" means the principal of, premium, if any, and unpaid interest on the following, whether outstanding at the date hereof or thereafter incurred or created: (i) indebtedness of the Issuer for money borrowed (including purchase-money obligations) evidenced by notes or other written obligations, (ii) indebtedness of the Issuer evidenced by securities (other than the Securities), debentures, bonds or other securities issued under the provisions of an indenture or similar instrument, (iii) obligations of the Issuer as lessee under capitalized leases and leases of property made as part of any sale and leaseback transactions, (iv) indebtedness of others of any of the kinds described in the preceding clauses (i) through (iii) assumed or guaranteed by the Issuer and (v) renewals, extensions and refundings of, and indebtedness and obligations of a successor corporation issued in exchange for or in replacement of, indebtedness or obligations of the kinds described in the preceding clauses (i) through (iv), unless in the case of any particular indebtedness, obligation, renewal, extension or refunding the instrument creating or evidencing the same or the assumption or guarantee thereof expressly provides that such indebtedness, obligation, renewal, extension or refunding is not superior in right of payment to the Securities. The Issuer covenants and agrees that it will not incur any subordinated indebtedness (other than the Securities) unless such subordinated indebtedness is subordinate to Senior Indebtedness at least to the same extent that the Securities are subordinate to Senior Indebtedness. SECTION 15.2. NO PAYMENT ON SECURITIES IN EVENT OF DEFAULT ON SENIOR INDEBTEDNESS. The Issuer shall not make any payment on account of the principal of, or premium, if any, or interest on the Securities if, at the time thereof or immediately after giving effect thereto, there exists (and has not been waived) any default in the payment of principal of, premium, if any, or interest on any Senior Indebtedness or any event of default with respect to any Senior Indebtedness as defined therein (after giving effect 80 89 to the giving of notice and any grace period provided for therein) or in any agreement pursuant to which any Senior Indebtedness is issued and the default is the subject of a judicial proceeding or the Issuer receives notice of the default from any holder of Senior Indebtedness or any trustee therefor; provided, however, that in the event the Securities have been declared due and payable pursuant to Section 5.1, the provisions of the next succeeding paragraph of this Section 15.2 shall be applicable. In the event that any Event of Default as defined in Section 5.1 shall occur (under such circumstances that the provisions of Section 15.3 are not applicable) and as a result the Securities then Outstanding are declared due and payable pursuant to Section 6.1, and such declaration shall not have been rescinded or annulled, the Issuer shall promptly cause notice thereof to be mailed to all holders of Senior Indebtedness whose names and addresses are known to the Issuer (and not later than said mailing date shall also cause notice thereof to be published at least once in one Authorized Newspaper in New York, New York), and the Issuer shall not make any payment on account of the principal of, or premium, if any, or interest on any Securities, unless at least 120 days shall have elapsed after said declaration and unless all principal of, premium, if any, and interest on Senior Indebtedness due at the time of such payment (whether by acceleration of the maturity thereof or otherwise) shall first be paid in full. The Issuer shall give prompt written notice to the Trustee and any paying agent of the existence of any of the conditions described in this Section 15.2. SECTION 15.3. DISTRIBUTION ON DISSOLUTION, LIQUIDATION AND REORGANIZATION OF THE ISSUER. In the event of any payment or distribution of assets or securities of the Issuer of any kind or character, whether in cash, property or securities, to creditors upon any dissolution or winding up or total or partial liquidation or reorganization of the Issuer, whether voluntary or involuntary and whether in bankruptcy, insolvency or receivership proceedings, or upon an assignment for the benefit of creditors or any other marshaling of the assets and liabilities of the Issuer, or upon other proceedings: (a) all principal of, premium, if any, and interest due on all Senior Indebtedness shall first be paid in full, or due provision made for such payment in accordance with the terms of such Senior Indebtedness, before any payment is made on account of the principal of, premium, if any, or interest on the indebtedness evidenced 81 90 by the Securities, or before the holders of the Securities shall be entitled to retain any assets so paid or distributed in respect thereof; and (b) any payment or distribution of assets or securities of the Issuer of any kind or character, whether in cash, property or securities (other than securities of the Issuer as reorganized or readjusted or securities of the Issuer or any other corporation provided for by a plan of reorganization or readjustment, which are in any such case subordinated to Senior Indebtedness to the same extent as the Securities), to which the holders of the Securities would be entitled except for the provisions of this Section 15.3, shall be paid or delivered by the Issuer or any receiver, trustee in bankruptcy, liquidating trustee, agent or other person making such payment or distribution directly to the holders of Senior Indebtedness (pro rata to each such holder on the basis of the respective amount of Senior Indebtedness held by such holder) or their representative or representatives or 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 all Senior Indebtedness in full in accordance with the terms of such Senior Indebtedness, 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 of the Securities. The Issuer shall give prompt written notice to the Trustee and any paying agent of any dissolution, winding up, liquidation or reorganization of the Issuer within the meaning of this Section 15.3. SECTION 15.4. PAYMENT TO HOLDERS OF SENIOR INDEBTEDNESS. Subject to the provisions of Section 15.6, in the event that, notwithstanding the provisions of Section 15.2 or Section 15.3, any payment or distribution of assets of the Issuer of any kind or character, whether in cash, property or securities (other than securities of the Issuer as reorganized or readjusted or securities of the Issuer or any other corporation provided for by a plan of reorganization or readjustment, which are in any such case subordinated to Senior Indebtedness to the same extent as the Securities), shall be received by the holders of the Securities (i) from the Issuer in violation of such provisions, or (ii) from any other person under such circumstances that such payment would, if made directly by the Issuer, be in violation of such provisions, such payment 82 91 or distribution shall immediately be paid over by such holders to the holders of Senior Indebtedness or their representative or representatives, or to the trustee or trustees under any indenture under which any instrument evidencing any of such Senior Indebtedness may have been issued, ratably according to the aggregate amounts then due on account of the principal of, premium, if any, and interest on such Senior Indebtedness (after giving effect to any concurrent payment or distribution to the holders of such Senior Indebtedness), to the extent necessary to pay in full all such amounts then due. Upon any payment or distribution of assets or securities of the Issuer referred to in Sections 15.2 and 15.3, the Trustee and any paying agent and the holders of the Securities shall be entitled to rely upon any order or decree of a court of competent jurisdiction, or upon any certificate of any liquidating trustee or agent or other person making any payment or distribution to the Trustee and any paying agent or to the holders of the Securities, for the purpose of ascertaining the persons entitled to participate in such payment or distribution, the holders of Senior Indebtedness, the amount thereof or payment thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Section. In the absence of any such order, decree, liquidating trustee, agent or other Person, the Trustee and each paying agent shall be entitled to rely upon a written notice by a Person representing himself to be a holder of Senior Indebtedness (or a trustee or representative on behalf of such holder) as evidence that such Person is a holder of Senior Indebtedness (or is such a trustee or representative). In the event that the Trustee or any paying agent 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 referred to in Sections 15.2 and 15.3, the Trustee or any paying agent may request such Person to furnish evidence to the reasonable satisfaction of the Trustee or any paying agent as to the amount of Senior Indebtedness held by such Person, as to the extent to which such Person is entitled to participation in such payment or distribution, and as to other facts pertinent to the rights of such Person under Sections 15.2 and 15.3, and if such evidence is not furnished, the Trustee or any paying agent may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment. SECTION 15.5. SUBROGATION. Subject to the payment in full of all amounts then due (whether by acceleration of the maturity thereof or otherwise) on 83 92 account of the principal of, premium, if any, and interest on all Senior Indebtedness at the time outstanding, the holders of the Securities shall be subrogated to the rights of each holder of Senior Indebtedness (to the extent of the payments or distributions made to such holder pursuant to the provisions of Sections 15.2, 15.3 and 15.4 to receive payments or distributions of assets or securities of the Issuer applicable to the Senior Indebtedness until the Securities shall be paid in full, and each holder of Senior Indebtedness by the act of accepting such payments or distributions pursuant to the provisions of Sections 15.2, 15.3 and 15.4 shall be deemed to have agreed to the subrogation aforesaid. No payments or distributions of assets or securities of the Issuer applicable to Senior Indebtedness which the holders of the Securities receive by reason of their being subrogated to the rights of the holders of such Senior Indebtedness pursuant to the provisions of Section 15.2, 15.3 and 15.4 shall, as between the Issuer, its creditors other than the holders of Senior Indebtedness, and the holders of the Securities, be deemed to be a payment by the Issuer on account of the Securities, it being understood that the provisions of this Section are intended solely for the purpose of defining the relative rights of the holders of the Securities, on the one hand, and the holders of the Senior Indebtedness, on the other hand, and nothing contained in this Section or elsewhere in this Agreement, or in the Securities, is intended to or shall impair, as between the Issuer, its creditors other than the holders of Senior Indebtedness, and the holders of the Securities, the obligation of the Issuer, which is absolute and unconditional, to pay to the holders of the Securities the principal of, premium, if any, and interest on the Securities, as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the holders of the Securities and creditors of the Issuer other than the holders of Senior Indebtedness, nor shall anything herein or therein prevent the Trustee or the holder of any Security from exercising all remedies otherwise permitted by applicable law upon default under this Agreement, subject to the rights, if any, under this Section of the holders of Senior Indebtedness in respect of cash, property or securities of the Issuer received upon the exercise of any such remedy. SECTION 15.6. PAYMENT ON SECURITIES PERMITTED. Nothing contained in this Section or elsewhere in this Agreement, or in any of the Securities, shall prevent the Issuer from making payment of the principal of, premium, if any, or interest on the Securities, at any time, except under the conditions described in Section 15.2 and except 84 93 during the pendency of any dissolution, winding up, liquidation or reorganization of the Issuer within the meaning of Section 15.3. Nothing contained in this Section or elsewhere in this Agreement, or in any of the Securities, shall prevent the application by the Trustee of any moneys deposited with it hereunder for the purpose, to the payment of or on account of the principal of, or premium, if any, or interest on the Securities, unless, prior to the Business Day next preceding the date upon which such principal or premium shall have become payable, or, in the case of any payment of or on account of interest unless, prior to two Business Days before the date upon which such interest shall have become payable, the Trustee shall have received written notice from the Issuer or any holder of Senior Indebtedness or any trustee therefor of the existence of any of the conditions described in Section 15.2 or of any dissolution, winding up, liquidation or reorganization of the Issuer within the meaning of Section 15.3. SECTION 15.7. AUTHORIZATION OF HOLDERS TO TRUSTEE TO EFFECT SUBORDINATION. Each holder of Securities by his acceptance thereof authorizes and directs the Trustee and any paying agent on such holder's behalf to take such action as may be necessary or appropriate to effectuate, as between the holders of the Securities and the holders of Senior Indebtedness, the subordination provided in this Section and appoints the Trustee and any paying agent his attorney-in-fact for any and all such purposes. SECTION 15.8. TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS. The Trustee or any paying agent shall be entitled to all the rights set forth in this Section 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 this Agreement shall deprive or be construed to deprive the Trustee of its rights as such holder. SECTION 15.9. NOTICES TO TRUSTEE. Notwithstanding the provisions of this Section or any other provisions of this Agreement, the Trustee or any paying agent shall not be charged with the knowledge of the existence of any Senior Indebtedness or of any facts which would prohibit the making of any payment of moneys to or by the Trustee or any paying agent, unless and until the Trustee or any paying agent shall have received written notice thereof from the Issuer or any holder of Senior Indebtedness or any trustee thereof. SECTION 15.10. NO FIDUCIARY DUTY BY TRUSTEE TO HOLDERS OF SENIOR INDEBTEDNESS. The Trustee and any paying 85 94 agent shall not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness and shall not be liable to any such holders if the Trustee or any paying agent shall mistakenly pay over or distribute to holders of Securities or the Issuer or any other Person moneys or assets to which any holders of Senior Indebtedness shall be entitled by virtue of this Section or otherwise. 86 95 IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of _______________, 199_. CHUBB CAPITAL CORPORATION By_____________________________ [CORPORATE SEAL] Attest: By________________________ THE CHUBB CORPORATION By_____________________________ [CORPORATE SEAL] Attest: By________________________ THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By_____________________________ [CORPORATE SEAL] Attest: By________________________ 87 96 STATE OF NEW YORK ) ) ss.: COUNTY OF NEW YORK ) On this ____ day of ____________, ____, before me personally came __________, to me personally known, who, being by me duly sworn, did depose and say that she resides in _________; that she is a _________ of Chubb Capital Corporation, one of the corporations described in and which executed the above instrument; that she knows the corporate seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that she signed her name thereto by like authority. [NOTARIAL SEAL] ------------------------- Notary Public 88 97 STATE OF NEW YORK ) ) ss.: COUNTY OF NEW YORK ) On this ____ day of ____________ ____, before me personally came __________, to me personally known, who, being by me duly sworn, did depose and say that she resides in __________, __________; that she is a __________ of The Chubb Corporation, one of the corporations described in and which executed the above instrument; that she knows the corporate seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that she signed her name thereto by like authority. [NOTARIAL SEAL] ------------------------- Notary Public 89 98 STATE OF NEW YORK ) ) ss.: COUNTY OF NEW YORK ) On this ____ day of ____________, ____, before me personally came __________, to me personally known, who, being by me duly sworn, did depose and say that he resides in __________, __________; that he is a __________ of The First National Bank of Chicago, one of the corporations described in and which executed the above instrument; that he knows the corporate seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that he signed his name thereto by like authority. [NOTARIAL SEAL] ------------------------- Notary Public 90 99 Exhibit (Form 1) [FORM OF FACE OF NOTE] No. $ CHUBB CAPITAL CORPORATION % Note Due CHUBB CAPITAL CORPORATION, a New Jersey corporation (the "Issuer"), for value received, hereby promises to pay to or registered assigns, at the office or agency of the Issuer in the Borough of Manhattan, the City of New York, the principal sum of Dollars on , in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, and to pay interest, semiannually on and of each year, commencing , , on said principal sum at said office or agency, in like coin or currency, at the rate per annum specified in the title of this Note, from the or the , as the case may be, next preceding the date of this Note to which interest has been paid, unless the date hereof is a date to which interest has been paid, in which case from the date of this Note, or unless no interest has been paid on these Notes, in which case from , , until payment of said principal sum has been made or duly provided for; provided, that payment of interest may be made at the option of the Issuer by check mailed to the address of the person entitled thereto as such address shall appear on the Security register. Notwithstanding the foregoing, if the date hereof is after the day of or , as the case may be, and before the following or , this Note shall bear interest from such or ; provided, that if the Issuer shall default in the payment of interest due on such or , then this Note shall bear interest from the next preceding or , to which interest has been paid or, if no interest has been paid on these Notes, from . The interest so payable on any or , will, subject to certain exceptions provided in the Indenture referred to on the reverse hereof, be paid to the person in whose name this Note is registered at the close of business on the or , as the case may be, next preceding such or . 100 The indebtedness evidenced by this Note is, to the extent provided in the Indenture, subordinate and subject in right of payment to the prior payment in full of all Senior Indebtedness, and this Note is issued subject to the provisions of the Indenture with respect thereto. Each Holder of this Security, by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and directs the Trustee on his behalf to take such action as may be necessary or appropriate to effectuate the subordination so provided and (c) appoints the Trustee his attorney-in-fact for any and all such purposes. Reference is made to the further provisions of this Note set forth on the reverse hereof. Such further provisions shall for all purposes have the same effect as though fully set forth at this place. This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by the Trustee under the Indenture referred to on the reverse hereof. IN WITNESS WHEREOF, Chubb Capital Corporation has caused this instrument to be signed by facsimile by its duly authorized officers and has caused a facsimile of its corporate seal to be affixed hereunto or imprinted hereon. Dated: CHUBB CAPITAL CORPORATION By__________________________ By__________________________ [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION] This is one of the Securities of the series designated herein referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By__________________________ Authorized Officer 2 101 [FOR PURPOSES OF SECTION 1232 OF THE UNITED STATES INTERNAL REVENUE CODE OF 1954, AS AMENDED, THE ISSUE PRICE OF THIS [ ] IS % OF ITS PRINCIPAL AMOUNT AND THE ISSUE DATE IS , .] [FORM OF GUARANTEE] The Chubb Corporation (the "Guarantor") hereby unconditionally guarantees to the holder of this Note duly authenticated and delivered by the Trustee, the due and punctual payment of the principal, and premium, if any, of (including any amount in respect of original issue discount), and interest, if any (together with any additional amounts payable pursuant to the terms of this Note), on this Note and the due and punctual payment of the sinking fund payments, if any, and analogous obligations, if any, provided for pursuant to the terms of this Note, when and as the same shall become due and payable, whether at maturity or upon redemption or upon declaration of acceleration or otherwise according to the terms of this Note and of the Indenture. In case of default by the Issuer in the payment of any such principal (including any amount in respect of original issue discount), interest (together with any additional amounts payable pursuant to the terms of this Note), sinking fund payment, or analogous obligation, the Guarantor agrees duly and punctually to pay the same. The Guarantor hereby agrees that its obligations hereunder shall be absolute and unconditional irrespective of any extension of the time for payment of this Note, any modification of this Note, any invalidity, irregularity or unenforceability of this Note or the Indenture, any failure to enforce the same or any waiver, modification or indulgence granted to the Issuer with respect thereto by the holder of this Note or the Trustee, or any other circumstances which may otherwise constitute a legal or equitable discharge of a surety or guarantor. The Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of merger or bankruptcy of the Issuer, any right to require a demand or proceeding first against the Issuer, protest or notice with respect to this Note or the indebtedness evidenced thereby and all demands whatsoever, and covenants that this guarantee will not be discharged as to this Note except by payment in full of the principal of (including any amount payable in respect of original issue discount), and interest, if any (together with any additional amounts payable pursuant to the terms of this Note), thereon. 3 102 The Guarantor irrevocably waives any and all rights to which it may be entitled, by operation of law or otherwise, upon making any payment hereunder (i) to be subrogated to the rights of a Holder against the Issuer with respect to such payment or otherwise to be reimbursed, indemnified or exonerated by the Issuer in respect thereof or (ii) to receive any payment, in the nature of contribution or for any other reason, from any other obligor with respect to such payment. This guarantee shall not be valid or become obligatory for any purpose with respect to this Note until the certificate of authentication on this Note shall have been signed by the Trustee. 4 103 IN WITNESS WHEREOF, The Chubb Corporation has caused this guarantee to be signed by facsimile by its duly authorized officers and has caused a facsimile of its corporate seal to be affixed hereunto or imprinted hereon. THE CHUBB CORPORATION By __________________ By __________________ 5 104 [FORM OF REVERSE OF NOTE] [Chubb Capital Corporation] % Note Due This Note is one of a duly authorized issue of debentures, notes, bonds or other evidences of indebtedness of the Issuer (hereinafter called the "Securities") of the series hereinafter specified, all issued or to be issued under and pursuant to an indenture dated as of October 25, 1989 (herein called the "Indenture"), among the Issuer, the Guarantor (as defined below) and The First National Bank of Chicago, as Trustee (herein called the "Trustee" which term includes any successor Trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Issuer and the Holders of the Securities. The Securities may be issued in one or more series, which different series may be issued in various aggregate principal amounts, may mature at different times, may bear interest (if any) at different rates, may be subject to different redemption provisions (if any), may be subject to different sinking, purchase or analogous funds (if any) and may otherwise vary as in the Indenture provided. This Note is one of a series designated as the ___% Notes Due _______________ (the "Notes") of the Issuer, limited in aggregate principal amount to $______. [The Indenture contains provisions for the defeasance at any time of the entire indebtedness of this Note upon compliance by the Issuer of certain conditions set forth therein, which provisions apply to this Note.] In case an Event of Default, as defined in the Indenture, with respect to the ____% Notes _________ shall have occurred and be continuing, the principal hereof may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the Holders of not less than a majority in aggregate principal amount of the Securities at the time Outstanding (as defined in the Indenture) of all series to be affected (voting as one 6 105 class), evidenced as in the Indenture provided, to execute supplemental indentures adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the Holders of the Securities of each such series; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Security, or reduce the principal amount thereof or any premium thereon, or reduce the rate or extend the time of payment of any interest thereon, or reduce any amount payable on redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof or provable in bankruptcy, or change the currency of payments of principal, premium, if any, or interest, or extend the time or reduce the amount of any payment to any sinking fund or analogous obligation relating to any Security, or impair or affect the rights of any Holder to institute suit for the payment thereof, without the consent of the Holder of each Security so affected, or (ii) reduce the aforesaid percentage of Securities, the Holders of which are required to consent to any such supplemental indenture, without the consent of the Holder of each Security affected or (iii) reduce the percentage of Securities of this series outstanding necessary to consent to waive any past default under the Indenture to less than a majority, without the consent of the Holder of each Security so affected, or (iv) modify the provisions of the sections of the Indenture dealing with supplementary indentures or waivers of covenants, except to increase any such percentage or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Security affected thereby, provided, however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to "the Trustee" and concomitant changes in such sections of the Indenture or the deletion of this proviso, in accordance with the requirements of the Indenture. It is also provided in the Indenture that, with respect to certain defaults or Events of Default regarding the Securities of any series, prior to any declaration accelerating the maturity of such Securities, the Holders of a majority in aggregate principal amount Outstanding of the Securities of such series (or, in the case of certain defaults or Events of Default, all or certain series of the Securities) may on behalf of the Holders of all the Securities of such series (or all or certain series of the Securities, as the case may be) waive any such past default or Event of Default and its consequences. The preceding sentence shall not, however, apply to a default in the payment of the principal of or premium, if any, or interest on any of the Securities. Any 7 106 such consent or waiver by the Holder of this Note (unless revoked as provided in the Indenture) shall be conclusive and binding upon such Holder and upon all future Holders and owners of this Note and any Notes which may be issued in exchange or substitution herefor, irrespective of whether or not any notation thereof is made upon this Note or such other Notes. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and any premium and interest on this Note in the manner, at the respective times, at the rate and in the coin or currency herein prescribed. The Notes are issuable in registered form without coupons in denominations of $_______ and any multiple of $_______ at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, and in the manner and subject to the limitations provided in the Indenture, but without the payment of any service charge. Notes may be exchanged for a like aggregate principal amount of Notes of other authorized denominations. [The Notes may be redeemed at the option of the Issuer, as a whole, or from time to time in part, on any date [after [_______________] and] prior to maturity, upon mailing a notice of such redemption not less than 30 nor more than 60 days prior to the date fixed for redemption to the Holders of Notes at their last registered addresses, all as further provided in the Indenture, at the following optional redemption prices (expressed in percentages of the principal amount) together in each case with accrued interest to the date fixed for redemption: If redeemed during the twelve-month period beginning ,
Year Percentage Year Percentage - ---- ---------- ---- ---------- ]
[As and for a sinking fund for the retirement of the Notes and so long as any of the Notes remain outstanding and unpaid, the Issuer will pay to the Trustee in cash [(subject to the right to deliver certain Notes in credit therefor as in the Indenture provided)], on or before 8 107 and on or before in each year thereafter to and including an amount sufficient to redeem $____________ principal amount of the Notes (or such lesser amount equal to the principal amount then Outstanding) at 100% of the principal amount thereof (the "sinking fund redemption price"), together with accrued interest to the date fixed for redemption. The Notes shall be redeemed through the operation of the sinking fund as herein provided on and on each thereafter to and including on notice as set forth in the Indenture. [At its option the Issuer may pay into the sinking fund for the retirement of Notes, in cash except as provided in the Indenture, on or before and on or before in each year thereafter to and including an amount sufficient to redeem an additional principal amount of Notes up to but not to exceed $__________ at the sinking fund redemption price. To the extent that the right to such optional sinking fund payment is not exercised in any year, it shall not be cumulative or carried forward to any subsequent year.] The Trustee shall select Notes for redemption, by prorating, as nearly as may be, the principal amount of Notes to be redeemed among the Holders of Notes. The Trustee shall make such adjustments, reallocations and eliminations to such proration as it shall deem proper to the end that the principal amount of Notes so redeemed shall be $1,000 or a multiple thereof, by increasing or decreasing or eliminating the amount which would be allocable to any Holder on the basis of exact proration by an amount not exceeding $1,000. The Trustee in its discretion may determine the particular Notes (if there are more than one) registered in the name of any Holder which are to be redeemed, in whole or in part.] [Subject to the provisions of the Indenture, the Holder of this Note is entitled, at its option, at any time on or before __________ (except that, in case this Note or any portion hereof shall be called for redemption, such right shall terminate with respect to this Note or portion hereof, as the case may be, so called for redemption at the close of business on the date fixed for redemption as provided in the Indenture unless the Issuer defaults in making the payment due upon redemption), to convert the principal amount of this Note (or any portion hereof which is $1,000 or an integral multiple thereof), into fully paid and non-assessable shares (calculated as to each conversion to the nearest 1/100th of a share) of the Common Stock of the Guarantor, as said shares shall be constituted at the date of conversion, at the conversion price of $_____ principal amount of Notes for each share of Common Stock, or at the adjusted conversion price in effect at the date of conversion determined as provided in the Indenture, upon 9 108 surrender of this Note, together with the conversion notice hereon duly executed, to the Issuer at the designated office or agency of the Issuer in ____________________, accompanied (if so required by the Issuer) by instruments of transfer, in form satisfactory to the Issuer and to the Trustee, duly executed by the Holder or by its duly authorized attorney in writing. Such surrender shall, if made during any period beginning at the close of business on a record date and ending at the opening of business on the interest payment date next following such record date (unless this Note or the portion being converted shall have been called for redemption on a date fixed for redemption during such period), also be accompanied by payment in funds acceptable to the Issuer of an amount equal to the interest payable on such interest payment date on the principal amount of this Note then being converted. Subject to the aforesaid requirement for payment and, in the case of a conversion after the record date next preceding any interest payment date and on or before such interest payment date, to the right of the Holder of this Note (or any predecessor security) of record at such record date to receive an installment of interest (with certain exceptions provided in the Indenture), no adjustment is to be made on conversion for interest accrued hereon or for dividends on shares of Common Stock issued on conversion. The Guarantor is not required to issue fractional shares upon any such conversion, but shall make adjustment therefor in cash on the basis of the current market value of such fractional interest as provided in the Indenture. The conversion price is subject to adjustment as provided in the Indenture. In addition, the Indenture provides that in case of certain consolidations, mergers or share exchanges to which the Guarantor is a party or the sale of substantially all of the assets of the Guarantor, the Indenture shall be amended, without the consent of any Holders of Securities, so that this Note, if then outstanding, will be convertible thereafter, during the period this Note shall be convertible as specified above, only into the kind and amount of securities, cash and other property receivable upon the consolidation, merger, share exchange or sale by a holder of the number of shares of Common Stock into which this Note might have been converted immediately prior to such consolidation, merger, share exchange or sale (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount received per share by a plurality of non-electing shares). In the event of conversion of this Note in part only, a new Note or Notes for the unconverted portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof. 10 109 Upon due presentment for registration of transfer of this Note at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, a new Note or Notes of authorized denominations for an equal aggregate principal amount will be issued to the transferee in exchange therefor, subject to the limitations provided in the Indenture, without charge except for any tax or other governmental charge imposed in connection therewith. The Issuer, the Guarantor, the Trustee and any authorized agent of the Issuer, the Guarantor or the Trustee may deem and treat the registered Holder hereof as the absolute owner of this Note (whether or not this Note shall be overdue and notwithstanding any notation of ownership or other writing hereon), for the purpose of receiving payment of, or on account of, the principal hereof and premium, if any, and subject to the provisions on the face hereof, interest hereon, and for all other purposes, and neither the Issuer nor the Guarantor nor the Trustee nor any authorized agent of the Issuer, the Guarantor or the Trustee shall be affected by any notice to the contrary. No recourse under or upon any obligation, covenant or agreement of the Issuer or the Guarantor in the Indenture or any indenture supplemental thereto or in any Note, or any guarantee, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, officer or director, as such, of the Issuer or the Guarantor or of any successor of either of them, either directly or through the Issuer or the Guarantor or any successor of either of them, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance hereof and as part of the consideration for the issue hereof. Terms used herein which are defined in the Indenture shall have the respective meanings assigned thereto in the Indenture. 11 110 Exhibit (Form 2) [FORM OF FACE OF ZERO COUPON SECURITY] No. $ CHUBB CAPITAL CORPORATION Zero Coupon [ ] CHUBB CAPITAL CORPORATION, a New Jersey corporation (the "Issuer"), for value received, hereby promises to pay to or registered assigns, at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, the principal sum of Dollars on , in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts. The principal of this [_____] shall not bear interest, except in the case of default in payment of principal upon acceleration, redemption or maturity, and in such case the amount in default shall bear interest at the rate of % per annum (to the extent enforceable under applicable law) from the date of default in payment to the date such payment has been made or duly provided for, at said office or agency and in like coin or currency. The indebtedness evidenced by this [_____] is, to the extent provided in the Indenture, subordinate and subject in right of payment to the prior payment in full of all Senior Indebtedness, and this [_____] is issued subject to the provisions of the Indenture with respect thereto. Each Holder of this [_____], by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and directs the Trustee on his behalf to take such action as may be necessary or appropriate to effectuate the subordination so provided and (c) appoints the Trustee his attorney-in-fact for any and all such purposes. Reference is made to the further provisions of this [_____] set forth on the reverse hereof. Such further provisions shall for all purposes have the same effect as though fully set forth at this place. This [_____] shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by the Trustee under the Indenture referred to on the reverse hereof. 111 IN WITNESS WHEREOF, Chubb Capital Corporation has caused this instrument to be signed by facsimile by its duly authorized officers and has caused a facsimile of its corporate seal to be affixed hereunto or imprinted hereon. Dated: CHUBB CAPITAL CORPORATION By______________________________ By______________________________ [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION] This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF CHICAGO, as Trustee By________________________________ Authorized Officer 2 112 [FORM OF GUARANTEE] The Chubb Corporation (the "Guarantor") hereby unconditionally guarantees to the holder of this [_________] duly authenticated and delivered by the Trustee, the due and punctual payment of the principal and, premium if any, of (including any amount of respect of original issue discount), and interest, if any (together with any additional amounts payable pursuant to the terms of this [_______]), on this __________ and the due and punctual payment of the sinking fund payments, if any, and analogous obligations, if any, and premium, if any, and conversion rights, if any, to the terms of this [_________], when and as the same shall become due and payable, whether at maturity or upon redemption or upon declaration of acceleration or otherwise according to the terms of this __________ and of the [_______]. In case of default by the Issuer in the payment of any such principal (including any amount in respect of original issue discount), premium interest (together with any additional amounts payable pursuant to the terms of this [_____]), sinking fund payment, or analogous obligation, the Guarantor agrees duly and punctually to pay the same. The Guarantor hereby agrees that its obligations hereunder shall be absolute and unconditional irrespective of any extension of the time for payment of this [_______], any modification of this [_______], any invalidity, irregularity or unenforceability of or the Indenture, any failure to enforce the same or any waiver, modification or indulgence granted to the Issuer with respect thereto by the holder of this [_______] or the Trustee, or any other circumstances which may otherwise constitute a legal or equitable discharge of a surety or guarantor. The Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of merger or bankruptcy of the Issuer, any right to require a demand or proceeding first against the Issuer, protest or notice with respect to this [_______] or the indebtedness evidenced thereby and all demands whatsoever, and covenants that this guarantee will not be discharged as to this [_________] except by payment in full of the principal of (including any amount payable in respect or original issue discount), and interest, if any together with any additional amounts payable or conversion pursuant to the terms of this [________], thereon. The Guarantor irrevocably waives any and all rights to which it may be entitled, by operation of law or otherwise, upon making any payment hereunder (i) to be subrogated to the rights of a Holder against the Issuer, with respect to such payment or otherwise to be reimbursed, 3 113 indemnified or exonerated by the Issuer in respect thereof or (ii) to receive any payment, in the nature of contribution or for any other reason, from any other obligor with respect to such payment. This guarantee shall not be valid or become obligatory for any purpose with respect to this __________ until the certificate of authentication this Debenture shall have been signed by the Trustee. IN WITNESS WHEREOF, The Chubb Corporation has caused this guarantee to be signed by facsimile by its duly authorized officers and has caused a facsimile of its corporate seal to be affixed hereunto or imprinted hereon. THE CHUBB CORPORATION By______________________________ By______________________________ 4 114 [FORM OF REVERSE OF ] FOR THE PURPOSES OF SECTION 1232 OF THE UNITED STATES INTERNAL REVENUE CODE OF 1954, AS AMENDED, THE ISSUE PRICE OF THIS [ ] IS % OF ITS PRINCIPAL AMOUNT AND THE ISSUE DATE IS , . [CHUBB CAPITAL CORPORATION] Zero Coupon [ ] Due This [ ] is one of a duly authorized issue of debentures, notes, bonds or other evidences of indebtedness of the Issuer (hereinafter called the "Securities") of the series hereinafter specified, all issued or to be issued under and pursuant to an indenture dated as of October 25, 1989 (herein called the "Indenture"), duly executed and delivered by the Issuer to The First National Bank of Chicago, Trustee (herein called the "Trustee"), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Issuer and the holders of the Securities. The Securities may be issued in one or more series, which different series may be issued in various aggregate principal amounts, may mature at different times, may bear interest (if any) at different rates, may be subject to different redemption provisions (if any), may be subject to different sinking, purchase or analogous funds (if any) and may otherwise vary as in the Indenture provided. This [ ] is one of a series designated as the Zero Coupon [ ] Due of the Issuer, limited in aggregate principal amount to $ . In case an Event of Default, as defined in the Indenture, with respect to the Zero Coupon [ ], shall have occurred and be continuing, (i) that portion of the principal equal to the initial public offering price of this [ ] plus accrued amortization of the original issue discount calculated using the "interest" method (computed in accordance with generally accepted accounting principles in effect on the date of the Indenture) from , to the date of acceleration may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the Holders of 5 115 not less than 66 2/3% in aggregate principal amount of the Securities at the time Outstanding (as defined in the Indenture) of all series to be affected (voting as one class), evidenced as in the Indenture provided, to execute supplemental indentures adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the Holders of the Securities of each such series; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Security, or reduce the principal amount thereof or any premium thereon, or reduce the rate or extend the time of payment of interest thereon, or reduce any amount payable on redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon acceleration or provable in bankruptcy, or change the currency of payment of principal, premium or interest, or extend the time or reduce the amount of any payment to any sinking fund or analogous obligation relating to any Security, or impair or affect the rights of any Holder to institute suit for the payment thereof, without the consent of the Holder of each Security so affected, or (ii) reduce the aforesaid percentage of Securities, the Holders of which are required to consent to any such supplemental indenture, without the consent of the Holder of each Security affected or (iii) reduce the percentage of Securities of this series outstanding necessary to consent to waive any past default under the Indenture to less than a majority, without the consent of the Holder of each Security affected or (iv) modify the provisions of the sections of the Indenture dealing with supplementary indentures or waivers of covenants, except to increase any such percentage or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Security affected thereby, [provided, however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to "the Trustee" and concomitant changes in such sections of the Indenture or the Deletion of this proviso, in accordance with the requirements of the Indenture.] It is also provided in the Indenture that, with respect to certain defaults or Events of Default regarding the Securities of any series, prior to any declaration accelerating the maturity of the Securities of any series, the Holders of a majority in aggregate principal amount Outstanding of the Securities of such series (or, in the case of certain defaults or Events of Default, all or certain series of the Securities) may on behalf of the Holders of all the Securities of such series (or all or certain series of the Securities, as the case may be) waive any such past default or Event of Default and its 6 116 consequences. The preceding sentence shall not, however, apply to a default in the payment of the principal of, or interest, if any, on any of the Securities. Any such consent or waiver by the Holder of this [ ] (unless revoked as provided in the Indenture) shall be conclusive and binding upon such Holder and upon all future Holders and owners of this [ ] and any [ ] which may be issued in exchange or substitution therefor, irrespective of whether or not any notation thereof is made upon this [ ] or such other [ ]. No reference herein to the Indenture and no provision of this [ ] or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest, if any, on this [ ] in the manner, at the respective times, at the rate and in the coin or currency herein prescribed. The [ ] are issuable in registered form without coupons in denominations of $ or any multiple of $ at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, and in the manner and subject to the limitations provided in the Indenture, but without the payment of any service charge, [ ] may be exchanged for a like aggregate principal amount of [ ] of other authorized denominations. [The [ ] may be redeemed at the option of the Issuer, as a whole, or from time to time in part, on any date prior to maturity, upon mailing a notice of such redemption to the holders of [ ] at their last registered addresses, all as further provided in the Indenture, at the redemption price of 100% of the principal amount thereof.] Subject to the provisions of the Indenture, the Holder of this [ ] is entitled, at its option, at any time on or before (except that, in case this [ ] or any portion hereof shall be called for redemption, such right shall terminate with respect to this [ ] or portion hereof, as the case may be, so called for redemption at the close of business on the date fixed for redemption as provided in the Indenture unless the Issuer defaults in making the payment due upon redemption), to convert the principal amount of this [ ] (or any portion hereof which is $1,000 or an integral multiple thereof), into fully paid and non-assessable shares (calculated as to each conversion to the nearest 1/100th of a share) of the Common Stock of the Guarantor, as said shares shall be constituted at the date of conversion, at the conversion price of $ principal amount of [ ] 7 117 for each share of Common Stock, or at the adjusted conversion price in effect at the date of conversion determined as provided in the Indenture, upon surrender of this [______], together with the conversion notice hereon duly executed, to the Issuer at the designated office or agency of the Issuer in ____________________, accompanied (if so required by the Issuer) by instruments of transfer, in form satisfactory to the Issuer and to the Trustee, duly executed by the Holder or by its duly authorized attorney in writing. Such surrender shall, if made during any period beginning at the close of business on a record date and ending at the opening of business on the interest payment date next following such record date (unless this [_____] or the portion being converted shall have been called for redemption on a date fixed for redemption during such period), also be accompanied by payment in funds acceptable to the Issuer of an amount equal to the interest payable on such interest payment date on the principal amount of this [_____] then being converted. Subject to the aforesaid requirement for payment and, in the case of a conversion after the record date next preceding any interest payment date and on or before such interest payment date, to the right of the Holder of this [_____] (or any predecessor security) of record at such record date to receive an installment of interest (with certain exceptions provided in the Indenture), no adjustment is to be made on conversion for interest accrued hereon or for dividends on shares of Common Stock issued on conversion. The Guarantor is not required to issue fractional shares upon any such conversion, but shall make adjustment therefor in cash on the basis of the current market value of such fractional interest as provided in the Indenture. The conversion price is subject to adjustment as provided in the Indenture. In addition, the Indenture provides that in case of certain consolidations, mergers or share exchanges to which the Guarantor is a party or the sale of substantially all of the assets of the Guarantor, the Indenture shall be amended, without the consent of any Holders of Securities, so that this Security, if then outstanding, will be convertible thereafter, during the period this [______] shall be convertible as specified above, only into the kind and amount of securities, cash and other property receivable upon the consolidation, merger, share exchange or sale by a holder of the number of shares of Common Stock into which this [_____] might have been converted immediately prior to such consolidation, merger, share exchange or sale (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount received per share by a plurality of non-electing shares). In the event of conversion of this [______] in part only, a new [_____] or [_____] for the unconverted portion hereof shall 8 118 be issued in the name of the Holder hereof upon the cancellation hereof. Upon due presentment for registration of transfer of this [ ] at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, a new [ ] or [ ] of authorized denominations for an equal aggregate principal amount will be issued to the transferee in exchange therefor, subject to the limitations provided in the Indenture, without charge except for any tax or other governmental charge imposed in connection therewith. The Issuer, the Trustee and any authorized agent of the Issuer or the Trustee may deem and treat the registered Holder hereof as the absolute owner of this [ ] (whether or not this [ ] shall be overdue and notwithstanding any notation of ownership or other writing hereon, for the purpose of receiving payment hereof, or on account hereof, and for all other purposes, and neither the Issuer nor the Trustee nor any authorized agent of the Issuer or the Trustee shall be affected by any notice to the contrary. No recourse under or upon any obligation, covenant or agreement of the Issuer in the Indenture or any indenture supplemental thereto or in any [ ], or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, officer or director, as such, of the Issuer or of any successor corporation, either directly or through the Issuer or any successor corporation, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance hereof and as part of the consideration for the issue hereof. Terms used herein which are defined in the Indenture shall have the respective meanings assigned thereto in the Indenture. 9 119 Exhibit (Form 3) [FORM OF FACE OF EXTENDIBLE NOTE] No. $ CHUBB CAPITAL CORPORATION - Year Extendible Note CHUBB CAPITAL CORPORATION, a New Jersey corporation (the "Issuer"), for value received, hereby promises to pay to or registered assigns, at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, the principal sum of Dollars on , in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, and to pay interest, (at the rate per annum from time to time in effect as described below) semiannually on and of each year, commencing , , on said principal sum at said office or agency, in like coin or currency, from the or the , as the case may be, next preceding the date of this Note to which interest has been paid, unless the date hereof is a date to which interest has been paid, in which case from the date of this Note, or unless no interest has been paid on these Notes, in which case from , , until payment of said principal sum has been made or duly provided; provided, however, that payment of interest may be made at the option of the Issuer by check mailed to the address of the person entitled thereto as such address shall appear on the Security register. Notwithstanding the foregoing, if the date hereof is after the day of or , as the case may be, and before the following or , this Note shall bear interest from such or ; provided, however, that if the Issuer shall default in the payment of interest due on such or , then this Note shall bear interest from the next preceding or , to which interest has been paid or, if no interest has been paid on these Notes, from . The interest so payable on any or , will, subject to certain exceptions provided in the Indenture referred to on the reverse hereof, be paid to the person in whose name this Note is registered at the close of business on such or , as the case may be, next preceding such or . 120 Interest on these Notes is payable at the rate of % per annum from through , and for each -month period beginning , and , at a rate per annum established by the Issuer on the preceding each such , or at a rate per annum determined by a method established by the Issuer on the preceding each such . The Issuer shall establish the interest rate or method to be used to determine such interest rate by delivery to the Trustee of an Officers' Certificate on such . On or before the prior to the commencement of the -month period to which it applies, the Trustee shall cause notice of such interest rate or the method to be used in ascertaining the interest rate on the following and the interest rate that would have been applicable to such -month period had such determination been made as of such , all as specified in the aforesaid Officers' Certificate, to be mailed to each holder of these Notes. The Issuer shall cause notice of the interest rate established as of the preceding the commencement of the -month period to be enclosed with the interest payment checks mailed to the Holders of the Notes for the period ending on the following such . The Notes of this series are subject to repayment on , , and , at the option of the Holders thereof exercisable on or before the , but not prior to the preceding such , at a repayment price equal to the principal amount thereof to be repaid, together with interest payable thereon to the repayment date, as described on the reverse side hereof. The indebtedness evidenced by this Note is, to the extent provided in the Indenture, subordinate and subject in right of payment to the prior payment in full of all Senior Debt, and this Note is issued subject to the provisions of the Indenture with respect thereto. Each Holder of this Note, by accepting the same, (a) agrees to and shall be bound by such provisions, (b) authorizes and directs the Trustee on his behalf to take such action as may be necessary or appropriate to effectuate the subordination so provided and (c) appoints the Trustee his attorney-in-fact for any and all such purposes. Reference is made to the further provisions of this Note set forth on the reverse hereof. Such further provisions shall for all purposes have the same effect as though fully set forth at this place. 2 121 This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed by the Trustee under the Indenture referred to on the reverse hereof. IN WITNESS WHEREOF, Chubb Capital Corporation has caused this instrument to be signed by facsimile by its duly authorized officers and has caused a facsimile of its corporate seal to be affixed hereunto or imprinted hereon. Dated: CHUBB CAPITAL CORPORATION By______________________________ By______________________________ [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION] This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF CHICAGO as Trustee By________________________________ Authorized Officer 3 122 [FORM OF REVERSE OF -YEAR EXTENDIBLE NOTE] The Chubb Corporation -Year Extendible Note This Note is one of a duly authorized issue of debentures, notes, bonds or other evidences of indebtedness of the Issuer (the "Securities") of the series hereinafter specified, all issued or to be issued under an indenture dated as of October __, 1989 (herein called the "Indenture"), duly executed and delivered by the Issuer to The First National Bank of Chicago, Trustee (herein called the "Trustee"), to which Indenture and all indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Issuer and the holders of the Securities. The Securities may be issued in one or more series, which different series may be issued in various aggregate principal amounts, may mature at different times, may bear interest (if any) at different rates, may be subject to different redemption provisions (if any), may be subject to different sinking, purchase or analogous funds (if any) and may otherwise vary as in the Indenture provided. This Note is one of a series designated as the -Year Extendible Notes of the Issuer, limited in aggregate principal amount to $ . The -Year Extendible Notes may be redeemed at the option of the Issuer as a whole or in part, or from time to time in part, on any date (i) on or after , , and prior to , (ii) on or after , , and prior to , (iii) on or after , , and prior to , and (iv) on or after , and prior to maturity upon mailing a notice of such redemption not less than 30 nor more than 60 days prior to the date fixed for redemption to the Holders of Notes at their last registered addresses, all as further provided in the Indenture at 100% of the principal amount thereof, together with accrued interest to the date fixed for redemption. If this Note is redeemed in part, the principal amount that remains Outstanding shall not be less than $ .] 4 123 In case an Event of Default, as defined in the Indenture, with respect to the -Year Extendible Notes, shall have occurred and be continuing, the principal hereof may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the Holders of not less than a majority in aggregate principal amount of the Securities at the time Outstanding (as defined in the Indenture) of all series to be affected (voting as one class), evidenced as in the Indenture provided, to execute supplemental indentures adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the Holders of the Securities of each such series; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Security, or reduce the principal amount thereof or any premium thereon, or reduce the rate or extend the time of payment of any interest thereon, or reduce any amount payable on redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof or provable in bankruptcy, or change the currency of payment of principal, premium or interest, or extend the time or reduce the amount of any payment to any sinking fund or analogous obligation relating to any Security, or impair or affect the rights of any Holder to institute suit for the payment thereof, without the consent of the Holder of each Security so affected, or (ii) reduce the aforesaid percentage of Securities, the Holders of which are required to consent to any such supplemental indenture, without the consent of the Holder of each Security affected or (iii) reduce the percentage of Securities of this series outstanding to consent to waive any past default under the Indenture to less than a majority, without the consent of the Holder of each Security affected, or (iv) modify the provisions of the sections of the Indenture dealing with supplementary indentures or waivers of covenants, except to increase any such percentage or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the Holder of each Security affected thereby, [provided, however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to "the Trustee" and concomitant changes in such sections of the Indenture or the Deletion of this proviso, in accordance with the requirements of the Indenture.] It is also provided in the Indenture that, with respect to certain defaults or Events of Default 5 124 regarding the Securities of any series, prior to any declaration accelerating the maturity of such Securities, the Holders of a majority in aggregate principal amount Outstanding of the Securities of such series (or, in the case of certain defaults or Events of Default, all or certain series of the Securities) may on behalf of the Holders of all the Securities of such series (or all or certain series of the Securities, as the case may be) waive any such past default or Event of Default. The preceding sentence shall not, however, apply to a default in the payment of the principal of or premium, if any, or interest, on any of the Securities. Any such consent or waiver by the Holder of this Note (unless revoked as provided in the Indenture) shall be conclusive and binding upon such Holder and upon all future Holders and owners of this Note and any -Year Extendible Notes which may be issued in exchange or substitution herefor, irrespective of whether or not any notation thereof is made upon this Note or such other -Year Extendible Notes. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and premium, if any, and interest on this Note in the manner, at the respective times, at the rate and in the coin or currency herein prescribed. The -Year Extendible Notes are subject to repayment in whole, or in part, on , , and , in increments of $ or multiples of $ in excess of $ , provided that the portion of the principal amount of any -Year Extendible Note not being repaid shall be at least $ , at the option of the Holders thereof at a repayment price equal to the principal amount thereof to be repaid, together with interest payable thereon to the repayment date. For this Note to be repaid at the option of the Holder, the Issuer must receive at its office or agency in the Borough of Manhattan, The City of New York, on or before the , or, if such is not a Business Day, the next succeeding Business Day, but not earlier than the prior to the on which the repayment price will be paid (i) this Note, with the form entitled "Option to Elect Repayment" below duly completed, or (ii) a telegram, telex, facsimile transmission or letter from a member of a national securities exchange or the National Association of Securities Dealers, Inc. or a commercial bank or trust company in the United States of America setting forth the name of the Holder of the Note, the principal amount of the Note, the amount of such Note to be repaid, a statement that the option to elect repayment is being made thereby and a guarantee that the Note 6 125 to be repaid with the form entitled "Option to Elect Repayment" on the reverse thereof duly completed will be received by the Issuer no later than five Business Days after the date of such telegram, telex, facsimile transmission or letter, and such Note and form duly completed are received by the Issuer by such fifth Business Day. Either form of notice duly received on or before the ___________ preceding any such shall be irrevocable. All questions as to the validity, eligibility (including time of receipt) and acceptance of any Notes for repayment will be determined by the Issuer, whose determination shall be final and binding. The -Year Extendible Notes are issuable in registered form without coupons in denominations of $ and any multiple of $ at the office or agency of the Issuer in the Borough of Manhattan, The City of New York, and in the manner and subject to the limitations provided in the Indenture, but without the payment of any service charge, -Year Extendible Notes may be exchanged for a like aggregate principal amount of -Year Extendible Notes of other authorized denominations. [Subject to the provisions of the Indenture, the Holder of this Note is entitled, at its option, at any time on or before __________ (except that, in case this Note or any portion hereof shall be called for redemption, such right shall terminate with respect to this Note or portion hereof, as the case may be, so called for redemption at the close of business on the date fixed for redemption as provided in the Indenture unless the Issuer defaults in making the payment due upon redemption), to convert the principal amount of this Issuer (or any portion hereof which is $1,000 or an integral multiple thereof), into fully paid and non-assessable shares (calculated as to each conversion to the nearest 1/100th of a share) of the Common Stock of the Guarantor, as said shares shall be constituted at the date of conversion, at the conversion price of $_____ principal amount of Notes for each share of Common Stock, or at the adjusted conversion price in effect at the date of conversion determined as provided in the Indenture, upon surrender of this Note, together with the conversion notice hereon duly executed, to the Issuer at the designated office or agency of the Issuer in ____________________, accompanied (if so required by the Issuer) by instruments of transfer, in form satisfactory to the Issuer and to the Trustee, duly executed by the Holder or by its duly authorized attorney in writing. Such surrender shall, if made during any period beginning at the close of business on a record date and ending at the opening of business on the interest payment date next following such record date (unless this Note or the portion being converted shall have been called for redemption on a date fixed for 7 126 redemption during such period), also be accompanied by payment in funds acceptable to the Issuer of an amount equal to the interest payable on such interest payment date on the principal amount of this Note then being converted. Subject to the aforesaid requirement for payment and, in the case of a conversion after the record date next preceding any interest payment date and on or before such interest payment date, to the right of the Holder of this Note (or any predecessor security) of record at such record date to receive an installment of interest (with certain exceptions provided in the Indenture), no adjustment is to be made on conversion for interest accrued hereon or for dividends on shares of Common Stock issued on conversion. The Guarantor is not required to issue fractional shares upon any such conversion, but shall make adjustment therefor in cash on the basis of the current market value of such fractional interest as provided in the Indenture. The conversion price is subject to adjustment as provided in the Indenture. In addition, the Indenture provides that in case of certain consolidations, mergers or share exchanges to which the Guarantor is a party or the sale of substantially all of the assets of the Guarantor, the Indenture shall be amended, without the consent of any Holders of Securities, so that this Security, if then outstanding, will be convertible thereafter, during the period this Note shall be convertible as specified above, only into the kind and amount of securities, cash and other property receivable upon the consolidation, merger, share exchange or sale by a holder of the number of shares of Common Stock into which this Note might have been converted immediately prior to such consolidation, merger, share exchange or sale (assuming such holder of Common Stock failed to exercise any rights of election and received per share the kind and amount received per share by a plurality of non-electing shares). In the event of conversion of this Note in part only, a new Note or Notes for the unconverted portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof. The Issuer, the Trustee and any authorized agent of the Issuer or the Trustee may deem and treat the registered Holder hereof as the absolute owner of this Note (whether or not this Note shall be overdue and notwithstanding any notation of ownership or other writing hereon, for the purpose of receiving payment of, or on account of, the principal hereof and premium, if any, and subject to the provisions on the face hereof, interest hereon and for all other purposes, and neither the Issuer nor the Trustee nor any authorized agent of the Issuer or the Trustee shall be affected by any notice to the contrary. No recourse under or upon any obligation, covenant or agreement of the Issuer in the Indenture or any indenture 8 127 supplemental thereto or in any -Year Extendible Note, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, officer or director, as such, of the Issuer or of any successor corporation, either directly or through the Issuer or any successor corporation, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance hereof and as part of the consideration for the issue hereof. Terms used herein which are defined in the Indenture shall have the respective meanings assigned thereto in the Indenture. 9 128 [FORM OF OPTION TO ELECT REPAYMENT] Option to Elect Repayment The undersigned hereby irrevocably requests and instructs the Issuer to repay the within Note (or portion thereof specified below) pursuant to its terms at a price equal to the principal amount thereof, together with interest to the repayment date, to the undersigned, at - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (Please Print or Typewrite Name and Address of the Undersigned) For this Note to be repaid the Issuer must receive at its office or agency in the Borough of Manhattan, The City and State of New York, or at such additional place or places of which the Issuer shall from time to time notify the holder of the within Note, on or before the or, if such is not a Business Day, the next succeeding Business Day, but not earlier than the prior to , , and , (i) this Note with this "Option to Elect Repayment" form duly completed or (ii) a telegram, telex, facsimile transmission or letter from a member of a national securities exchange or the National Association of Securities Dealers, Inc. or a commercial bank or a trust company in the United States of America setting forth the name of the holder of the Note, the principal amount of the Note, the amount of the Note to be repaid, a statement that the option to elect repayment is being made thereby and a guarantee that the Note to be repaid with the form entitled "Option to Elect Repayment" on the reverse of the Note duly completed will be received by the Issuer not later than five Business Days after the date of such telegram, telex, facsimile transmission or letter, and such Note and form duly completed are received by the Issuer by such fifth Business Day. If less than the entire principal amount of the within Note is to be repaid, specify the portion thereof (which shall be $ or an integral multiple of $ in excess of $ ) which the Holder elects to have repaid: $ ; and specify the denomination or denominations (which shall be $ or multiple of 10 129 $ in excess of $ ) of the -Year Extendible Note or Notes to be issued to the Holder for the portion of the within Note not being repaid (in the absence of such specification, one such Note will be issued for the portion not being repaid); $ . Dated: -------------------------------------- Note: The signature to this Option to Elect Repayment must correspond with the name as written upon the face of the Note in every particular without alteration or enlargement or any other change whatsoever. 11 130 [FORM OF GUARANTEE] The Chubb Corporation (the "Guarantor") hereby unconditionally guarantees to the holder of this [_________] duly authenticated and delivered by the Trustee, the due and punctual payment of the principal and, premium if any, of (including any amount of respect of original issue discount), and interest, if any (together with any additional amounts payable pursuant to the terms of this [_______]), on this __________ and the due and punctual payment of the sinking fund payments, if any, and analogous obligations, if any, provided for pursuant, and premium, if any, to the terms of this [_________], when and as the same shall become due and payable, whether at maturity or upon redemption or upon declaration of acceleration or otherwise according to the terms of this __________ and of the [_______]. In case of default by the Issuer in the payment of any such principal (including any amount in respect of original issue discount), premium interest (together with any additional amounts payable pursuant to the terms of this [_____]), sinking fund payment, or analogous obligation, the Guarantor agrees duly and punctually to pay the same. The Guarantor hereby agrees that its obligations hereunder shall be absolute and unconditional irrespective of any extension of the time for payment of this [_______], any modification of this [_______], any invalidity, irregularity or unenforceability of or the Indenture, any failure to enforce the same or any waiver, modification or indulgence granted to the Issuer with respect thereto by the holder of this [_______] or the Trustee, or any other circumstances which may otherwise constitute a legal or equitable discharge of a surety or guarantor. The Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of merger or bankruptcy of the Issuer, any right to require a demand or proceeding first against the Issuer, protest or notice with respect to this [_______] or the indebtedness evidenced thereby and all demands whatsoever, and covenants that this guarantee will not be discharged as to this [_________] except by payment in full of the principal of (including any amount payable in respect or original issue discount), and interest, if any (together with any additional amounts payable pursuant to the terms of this [________], thereon. The Guarantor irrevocably waives any and all rights to which it may be entitled, by operation of law or otherwise, upon making any payment hereunder (i) to be subrogated to the rights of a Holder against the Issuer, with respect to such payment or otherwise to be reimbursed, indemnified or exonerated by the Issuer in respect thereof or (ii) to receive 12 131 any payment, in the nature of contribution or for any other reason, from any other obligor with respect to such payment. This guarantee shall not be valid or become obligatory for any purpose with respect to this Debenture until the certificate of authentication this Debenture shall have been signed by the Trustee. IN WITNESS WHEREOF, The Chubb Corporation has caused this guarantee to be signed by facsimile by its duly authorized officers and has caused a facsimile of its corporate seal to be affixed hereunto or imprinted hereon. THE CHUBB CORPORATION By________________________________ By________________________________ 13 132 [FORM OF OPTION TO ELECT REPAYMENT] Option to Elect Repayment The undersigned hereby irrevocably requests and instructs the Issuer to repay the within Note (or portion thereof specified below) pursuant to its terms at a price equal to the principal amount thereof, together with interest to the repayment date, to the undersigned, at - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (Please Print or Typewrite Name and Address of the Undersigned) For this Note to be repaid the Issuer must receive at its office or agency in the Borough of Manhattan, The City and State of New York, or at such additional place or places of which the Issuer shall from time to time notify the holder of the within Note, on or before the or, if such is not a Business Day, the next succeeding Business Day, but not earlier than the prior to , , and , (i) this Note with this "Option to Elect Repayment" form duly completed or (ii) a telegram, telex, facsimile transmission or letter from a member of a national securities exchange or the National Association of Securities Dealers, Inc. or a commercial bank or a trust company in the United States of America setting forth the name of the holder of the Note, the principal amount of the Note, the amount of the Note to be repaid, a statement that the option to elect repayment is being made thereby and a guarantee that the Note to be repaid with the form entitled "Option to Elect Repayment" on the reverse of the Note duly completed will be received by the Issuer not later than five Business Days after the date of such telegram, telex, facsimile transmission or letter, and such Note and form duly completed are received by the Issuer by such fifth Business Day. If less than the entire principal amount of the within Note is to be repaid, specify the portion thereof (which shall be $ or an integral multiple of $ in excess of $ ) which the Holder elects to have repaid: $ ; and specify the denomination or denominations (which shall be $ or multiple of $ in excess of $ ) of the - -Year Extendible Note or Notes to be issued to the Holder for the portion of the within Note not being repaid (in the absence of 14 133 such specification, one such Note will be issued for the portion not being repaid); $ . Dated: -------------------------------------- Note: The signature to this Option to Elect Repayment must correspond with the name as written upon the face of the Note in every particular without alteration or enlargement or any other change whatsoever. 15 EX-4.10 8 DEPOSIT AGREEMENT 1 Exhibit 4.10 THE CHUBB CORPORATION, [ ], As Depositary AND THE HOLDERS FROM TIME TO TIME OF THE DEPOSITARY RECEIPTS DESCRIBED HEREIN ------------------- DEPOSIT AGREEMENT ------------------- Dated as of [ ] ______________________________________________________________ 2 TABLE OF CONTENTS ARTICLE I Definitions ................................................. 1 ARTICLE II Form of Receipts, Deposit of Stock, Execution and Delivery, Transfer, Surrender and Redemption of Receipts ........................ 2 SECTION 2.01. Form and Transfer of Receipts ............................... 2 SECTION 2.02. Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof ..................... 4 SECTION 2.03. Registration of Transfer of Receipts ........................ 5 SECTION 2.04. Split-ups and Combinations of Receipts; Surrender of Receipts and Withdrawal of Stock ......................................... 5 SECTION 2.05. Limitations on Execution and Delivery, Transfer, Surrender and Exchange of Receipts ........................................ 6 SECTION 2.06. Lost Receipts, etc .......................................... 7 SECTION 2.07. Cancellation and Destruction of Surrendered Receipts ........................................ 7 SECTION 2.08. Redemption of Stock ......................................... 7 ARTICLE III CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY SECTION 3.01. Filing Proofs, Certificates and Other Information ................................................. 9 SECTION 3.02. Payment of Taxes or Other Governmental Charges ..................................................... 9 i 3 SECTION 3.03. Warranty as to Stock ....................................... 10 ARTICLE IV THE DEPOSITED SECURITIES; NOTICES SECTION 4.01. Cash Distributions ......................................... 10 SECTION 4.02. Distributions Other than Cash, Rights, Preferences or Privileges .................................. 10 SECTION 4.03. Subscription Rights, Preferences or Privileges ................................................. 11 SECTION 4.04. Notice of Dividends, etc.; Fixing Record Date for Holders of Receipts ........................ 12 SECTION 4.05. Voting Rights .............................................. 13 SECTION 4.06. Changes Affecting Deposited Securities and Reclassifications, Recapitalizations, etc ..................................... 13 SECTION 4.07. Delivery of Reports ........................................ 14 SECTION 4.08. List of Receipt Holders .................................... 14 ARTICLE V THE DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR AND THE COMPANY SECTION 5.01. Maintenance of Offices, Agencies and Transfer Books by the Depositary; Registrar .................................................. 14 SECTION 5.02. Prevention of or Delay in Performance by the Depositary, the Depositary's Agents, the Registrar or the Company ....................... 16 SECTION 5.03. Obligation of the Depositary, the Depositary's Agents, the Registrar and the Company ............................................ 16 SECTION 5.04. Resignation and Removal of the Depositary; Appointment of Successor Depositary ................................................. 18 SECTION 5.05. Corporate Notices and Reports .............................. 19 SECTION 5.06. Indemnification by the Company ............................. 19 ii 4 SECTION 5.07. Charges and Expenses ....................................... 20 SECTION 5.08. Tax Compliance ............................................. 20 ARTICLE VI AMENDMENT AND TERMINATION SECTION 6.01. Amendment .................................................. 21 SECTION 6.02. Termination ................................................ 21 ARTICLE VII MISCELLANEOUS SECTION 7.01. Counterparts ............................................... 22 SECTION 7.02. Exclusive Benefit of Parties ............................... 22 SECTION 7.03. Invalidity of Provisions ................................... 22 SECTION 7.04. Notices .................................................... 22 SECTION 7.05. Appointment of Registrar ................................... 24 SECTION 7.06. Holders of Receipts are Parties ............................ 24 SECTION 7.07. GOVERNING LAW .............................................. 24 SECTION 7.08. Inspection of Deposit Agreement ............................ 24 SECTION 7.09. Headings ................................................... 24 Form of Face of Receipt .................................................. A-1 Form of Reverse of Receipt ............................................... A-3 iii 5 DEPOSIT AGREEMENT, dated as of [ ], among THE CHUBB CORPORATION, a New Jersey corporation, (the "Company"), [ ], a [ ] (the "Depositary"), and the holders from time to time of the Receipts described herein. WHEREAS, it is desired to provide, as hereinafter set forth in this Deposit Agreement, for the deposit of shares of [ % Preferred Stock] of the Company with the Depositary for the purposes set forth in this Deposit Agreement and for the issuance hereunder of Receipts evidencing Depositary Shares in respect of the Stock so deposited; and WHEREAS, the Receipts are to be substantially in the form of Annex A annexed hereto, with appropriate insertions, modifications and omissions, as hereinafter provided in this Deposit Agreement; NOW, THEREFORE, in consideration of the promises contained herein, the parties hereto agree as follows: ARTICLE I Definitions The following definitions shall, for all purposes, unless otherwise indicated, apply to the respective terms used in this Deposit Agreement: "Articles" shall mean the Articles Supplementary of the Company establishing the Stock as a series of preferred stock of the Company. "Deposit Agreement" shall mean this Deposit Agreement, as amended or supplemented from time to time. "Depositary" shall mean [ ], and any successor as Depositary hereunder. "Depositary Shares" shall mean Depositary Shares, each representing [ ] of a share of Stock and evidenced by a Receipt. "Depositary's Agent" shall mean an agent appointed by the Depositary pursuant to Section 5.01 and shall include the Registrar if such Registrar is not the Depositary. 6 "Depositary's Office" shall mean the principal office of the Depositary, at which at any particular time its depositary receipt business shall be administered. "Receipt" shall mean one of the Depositary Receipts, substantially in the form set forth as Annex A hereto, issued hereunder, whether in definitive or temporary form and evidencing the number of Depositary Shares held of record by the record holder of such Depositary Shares. "Record holder" or "holder" as applied to a Receipt shall mean the person in whose name a Receipt is registered on the books of the Depositary maintained for such purpose. "Registrar" shall mean the Depositary or such other bank or trust company which shall be appointed to register ownership and transfers of Receipts as herein provided. "Securities Act" shall mean the Securities Act of 1933, as amended. "Stock" shall mean shares of the Company's [ % Preferred Stock, without par value]. ARTICLE II Form of Receipts, Deposit of Stock, Execution and Delivery, Transfer, Surrender and Redemption of Receipts SECTION 2.01. Form and Transfer of Receipts. Definitive Receipts shall be engraved or printed or lithographed on steel-engraved borders, with appropriate insertions, modifications and omissions, as hereinafter provided, if required by any securities exchange on which the Receipts are listed. Pending the preparation of definitive Receipts or if definitive Receipts are not required by any securities exchange on which the Receipts are listed, the Depositary, upon the written order of the Company or any holder of Stock, as the case may be, delivered in compliance with Section 2.02, shall execute and deliver temporary Receipts which are printed, lithographed, typewritten, mimeographed or otherwise substantially of the tenor of the definitive Receipts in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations as the persons executing such Receipts may determine, as evidenced by their execution of such Receipts. If temporary Receipts are issued, the 2 7 Company and the Depositary will cause definitive Receipts to be prepared without unreasonable delay. After the preparation of definitive Receipts, the temporary Receipts shall be exchangeable for definitive Receipts upon surrender of the temporary Receipts at the Depositary's Office or at such other place or places as the Depositary shall determine, without charge to the holder. Upon surrender for cancellation of any one or more temporary Receipts, the Depositary shall execute and deliver in exchange therefor definitive Receipts representing the same number of Depositary Shares as represented by the surrendered temporary Receipt or Receipts. Such exchange shall be made at the Company's expense and without any charge to the holder therefor. Until so exchanged, the temporary Receipts shall in all respects be entitled to the same benefits under this Deposit Agreement, and with respect to the Stock, as definitive Receipts. Receipts shall be executed by the Depositary by the manual signature of a duly authorized officer of the Depositary; provided, that such signature may be a facsimile if a Registrar for the Receipts (other than the Depositary) shall have been appointed and such Receipts are countersigned by a manual signature of a duly authorized officer of the Registrar. No Receipt shall be entitled to any benefits under this Deposit Agreement or be valid or obligatory for any purpose unless it shall have been executed manually by a duly authorized officer of the Depositary or, if a Registrar for the Receipts (other than the Depositary) shall have been appointed, by manual or facsimile signature of a duly authorized officer of the Depositary and countersigned, manually, by a duly authorized officer of such Registrar. The Depositary shall record on its books each Receipt so signed and delivered as hereinafter provided. Receipts shall be in denominations of any number of whole Depositary Shares. The Company shall deliver to the Depositary from time to time such quantities of Receipts as the Depositary may request to enable the Depositary to perform its obligations under this Deposit Agreement. Receipts may be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent with the provisions of this Deposit Agreement as may be required by the Depositary or required to comply with any applicable law or any regulation thereunder or with the rules and regulations of any securities exchange upon which the Stock, the Depositary Shares or the Receipts may be listed or to confirm with any usage with respect thereto, 3 8 or to indicate any special limitations or restrictions to which any particular Receipts are subject. Title to Depositary Shares evidenced by a Receipt, which is properly endorsed or accompanied by a properly executed instrument of transfer, shall be transferable by delivery with the same effect as in the case of a negotiable instrument; provided, however, that until transfer of a Receipt shall be registered on the books of the Depositary as provided in Section 2.03, the Depositary may, notwithstanding any notice to the contrary, treat the record holder thereof at such time as the absolute owner thereof for the purpose of determining the person entitled to distributions of dividends or other distributions or to any notice provided for in this Deposit Agreement and for all other purposes. SECTION 2.02. Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof. Subject to the terms and conditions of this Deposit Agreement, the Company or any holder of Stock may from time to time deposit shares of the Stock under this Deposit Agreement by delivery to the Depositary of a certificate or certificates for the Stock to be deposited, properly endorsed or accompanied, if required by the Depositary, by a duly executed instrument of transfer or endorsement, in form satisfactory to the Depositary, together with all such certifications as may be required by the Depositary in accordance with the provisions of this Deposit Agreement, and together with a written order of the Company or such holder, as the case may be, directing the Depositary to execute and deliver to, or upon the written order to, the person or persons stated in such order a Receipt or Receipts for the number of Depositary Shares representing such deposited Stock. Deposited Stock shall be held by the Depositary at the Depositary's Office or at such other place or places as the Depositary shall determine. Upon receipt by the Depositary of a certificate or certificates for Stock deposited in accordance with the provisions of this Section, together with the other documents required as above specified, and upon recordation of the Stock on the books of the Company in the name of the Depositary or its nominee, the Depositary, subject to the terms and conditions of this Deposit Agreement, shall execute and deliver, to or upon the order of the person or persons named in the written order delivered to the Depositary referred to in the first paragraph of this Section, a Receipt or Receipts for the whole number of Depositary Shares representing the Stock so deposited and 4 9 registered in such name or names as may be requested by such person or persons. The Depositary shall execute and deliver such Receipt or Receipts at the Depositary's Office or such other offices, if any, as the Depositary may designate. Delivery at other offices shall be at the risk and expense of the person requesting such delivery. SECTION 2.03. Registration of Transfer of Receipts. Subject to the terms and conditions of this Deposit Agreement, the Depositary shall register on its books from time to time transfers of Receipts upon any surrender thereof by the holder in person or by duly authorized attorney, properly endorsed or accompanied by a properly executed instrument of transfer. Thereupon, the Depositary shall execute a new Receipt or Receipts evidencing the same aggregate number of Depositary Shares as those evidenced by the Receipt or Receipts surrendered and deliver such new Receipt or Receipts to or upon the order of the person entitled thereto. SECTION 2.04. Split-ups and Combinations of Receipts; Surrender of Receipts and Withdrawal of Stock. Upon surrender of a Receipt or Receipts at the Depositary's Office or at such other offices as it may designate for the purpose of effecting a split-up or combination of such Receipt or Receipts, and subject to the terms and conditions of this Deposit Agreement, the Depositary shall execute and deliver a new Receipt or Receipts in the authorized denomination or denominations requested, evidencing the aggregate number of Depositary Shares evidenced by the Receipt or Receipts surrendered, provided, however, that the Depositary shall not issue any Receipt evidencing a fractional Depositary Share. Any holder of a Receipt or Receipts representing any number of whole shares of Stock may (unless the related Depositary Shares have previously been called for redemption) withdraw the Stock and all money and other property, if any, represented thereby by surrendering such Receipt or Receipts, at the Depositary's Office or at such other offices as the Depositary may designate for such withdrawals. Thereafter, without unreasonable delay, the Depositary shall deliver to such holder or to the person or persons designated by such holder as hereinafter provided, the number of whole shares of Stock and all money and other property, if any, represented by the Receipt or Receipts so surrendered for withdrawal, but holders of such whole shares of Stock will not thereafter be entitled to deposit such Stock hereunder or to receive Depositary Shares therefor. If a Receipt delivered by the holder to the Depositary in connection with such withdrawal shall evidence a number of 5 10 Depositary Shares representing the number of whole shares of Stock to be so withdrawn, the Depositary shall at the same time, in addition to such number of whole shares of Stock and such money and other property, if any, to be so withdrawn, deliver to such holder, or upon his order, a new Receipt evidencing such excess number of Depositary Shares, provided, however, that the Depositary shall not issue any Receipt evidencing a fractional Depositary Share. Delivery of the Stock and money and other property being withdrawn may be made by the delivery of such certificates, documents of title and other instruments as the Depositary may deem appropriate which, if required by the Depositary shall be properly endorsed or accompanied by proper instruments of transfer. If the Stock and the money and other property being withdrawn are to be delivered to a person or persons other than the record holder of the Receipt or Receipts being surrendered for withdrawal of Stock, such holders shall execute and deliver to the Depositary a written order so directing the Depositary and the Depositary may require that the Receipt or Receipts surrendered by such holder for withdrawal of such shares of Stock be properly endorsed in blank or accompanied by a properly executed instrument of transfer in blank. Delivery of the Stock and the money and other property, if any, represented by Receipts surrendered for withdrawal shall be made by the Depositary at the Depositary's Office, except that, at the request, risk and expense of the holder surrendering such Receipt or Receipts and for the account of the holder thereof, such delivery may be made at such other place as may be designated by such holder. SECTION 2.05. Limitations on Execution and Delivery, Transfer, Surrender and Exchange of Receipts. As a condition precedent to the execution and delivery, registration of transfer, split-up, combination, surrender or exchange of any Receipt, the Depositary, any of the Depositary's Agents or the Company may require payment to it of a sum sufficient for the payment (or, in the event that the Depositary or the Company shall have made such payment, the reimbursement to it) of any charges or expenses payable by the holder of a Receipt pursuant to Sections 3.02 and 5.07, may require the production of evidence satisfactory to it as to the identity and genuineness of any signature and may also require compliance with such regulations, if any, as the Depositary or the Company may establish consistent with the provisions of this Deposit Agreement. 6 11 The deposit of Stock may be refused, the delivery of Receipts against Stock may be suspended, the registration of transfer of Receipts may be refused and the registration of transfer, surrender or exchange of outstanding Receipts may be suspended (i) during any period when the register of stockholders of the Company is closed, (ii) if any such action is deemed necessary or advisable by the Depositary, any of the Depositary's Agents or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission or under any provision of this Deposit Agreement or (iii) with the approval of the Company, for any other reason. SECTION 2.06. Lost Receipts, etc. In case any Receipt shall be mutilated, destroyed, lost or stolen, the Depositary in its discretion may execute and deliver a Receipt of like form and tenor in exchange and substitution for such mutilated Receipt, or in lieu of and in substitution for such destroyed, lost or stolen Receipt, upon (i) the filing by the holder thereof with the Depositary of evidence satisfactory to the Depositary of such destruction or loss or theft of such Receipt, of the authenticity thereof and of his or her ownership thereof, (ii) the furnishing of the Depositary with reasonable indemnification satisfactory to it and (iii) the payment of any expense (including fees, charges and expenses of the Depositary) in connection with such execution and delivery. SECTION 2.07. Cancellation and Destruction of Surrendered Receipts. All Receipts surrendered to the Depositary or any Depositary's Agent shall be canceled by the Depositary. Except as prohibited by applicable law or regulation, the Company is authorized to destroy all Receipts so canceled. SECTION 2.08. Redemption of Stock. Whenever the Company shall be permitted and shall elect to redeem shares of Stock in accordance with the provisions of the Articles, it shall (unless otherwise agreed to in writing with the Depositary) give or cause to be given to the Depositary not less than 30 days' and not more than 60 days' notice of the date of such proposed redemption of Stock and of the number of such shares held by the Depositary to be so redeemed and the applicable redemption price, as set forth in the Articles, which notice shall be accompanied by Articles from the Company stating that such redemption of Stock is in accordance with the provisions of the Articles. On the date of such redemption, provided that the Company shall then have paid or caused to be paid in full to the Depositary the redemption price of the Stock to be redeemed, plus an amount equal to any accrued and unpaid dividends thereon to the 7 12 date fixed for redemption, in accordance with the provisions of the Articles, the Depositary shall redeem the number of Depositary Shares representing such Stock. The Depositary shall mail notice of the Company's redemption of Stock and the proposed simultaneous redemption of the number of Depositary Shares representing the Stock to be redeemed by first class mail, postage prepaid, not less than 20 and not more than 50 days prior to the date fixed for redemption of such Stock and Depositary Shares (the "Redemption Date") to the record holders of the Receipts evidencing the Depositary Shares to be so redeemed, at the addresses of such holders as they appear on the records of the Depositary; but neither failure to mail any such notice of redemption of Depositary Shares to one or more such holders nor any defect in any notice of redemption of Depositary Shares to one or more such holders shall affect the sufficiency of the proceedings for redemption as to the other holders. The Company will provide the Depositary with the information necessary for the Depositary to prepare such notice and each such notice shall state: (i) the Redemption Date; (ii) the number of Depositary Shares to be redeemed and, if less than all the Depositary Shares held by any such holder are to be redeemed, the number of such Depositary Shares held by such holder to be so redeemed; (iii) the redemption price; (iv) the place or places where Receipts evidencing Depositary Shares are to be surrendered for payment of the redemption price; and (v) that dividends in respect of the Stock represented by the Depositary Shares to be redeemed will cease to accrue on such Redemption Date. In case less than all the outstanding Depositary Shares are to be redeemed, the Depositary Shares to be so redeemed shall be selected by the Depositary by lot or pro rata (as nearly as may be) or by any other method, in each case, as determined by the Depositary in its sole discretion to be equitable. Notice having been mailed by the Depositary as aforesaid, from and after the Redemption Date (unless the Company shall have failed to provide the funds necessary to redeem the Stock evidenced by the Depositary Shares called for redemption) (i) dividends on the shares of Stock so called for redemption shall cease to accrue from and after such date, (ii) the Depositary Shares being redeemed from such proceeds shall be deemed no longer to be outstanding, (iii) all rights of the holders of Receipts evidencing such Depositary Shares (except the right to receive the redemption price) shall, to the extent of such Depositary Shares, cease and terminate, and (iv) upon surrender in accordance with such redemption notice of the Receipts evidencing any such Depositary Shares called for redemption (properly endorsed or assigned for transfer, if the Depositary or applicable law shall so require), such 8 13 Depositary Shares shall be redeemed by the Depositary at a redemption price per Depositary Share equal to one- [ ] of the redemption price per share paid with respect to the shares of Stock plus all money and other property, if any, represented by such Depositary Shares, including all amounts paid by the Company in respect of dividends which on the Redemption Date have accumulated on the shares of Stock to be so redeemed and have not theretofore been paid. If fewer than all of the Depositary Shares evidenced by a Receipt are called for redemption, the Depositary will deliver to the holder of such Receipt upon its surrender to the Depositary, together with the redemption payment, a new Receipt evidencing the Depositary Shares evidenced by such prior Receipt and not called for redemption. ARTICLE III Certain Obligations of Holders of Receipts and the Company SECTION 3.01. Filing Proofs, Certificates and Other Information. Any holder of a Receipt may be required from time to time to file such proof of residence, or other matters or other information, to execute such certificates and to make such representations and warranties as the Depositary or the Company may reasonably deem necessary or proper. The Depositary or the Company may withhold the delivery, or delay the registration of transfer, redemption or exchange, of any Receipt or the withdrawal or conversion of the Stock represented by the Depositary Shares evidenced by any Receipt or the distribution of any dividend or other distribution or the sale of any rights or of the proceeds thereof until such proof or other information is filed or such certificates are executed or such representations and warranties are made. SECTION 3.02. Payment of Taxes or Other Governmental Charges. Holders of Receipts shall be obligated to make payments to the Depositary of certain charges and expenses, as provided in Section 5.07. Registration of transfer of any Receipt or any withdrawal of Stock and all money or other property, if any, represented by the Depositary Shares evidenced by such Receipt may be refused until any such payment due is made, and any dividends, interest payments or other distributions may be withheld or any part of or all the Stock or other property represented by the Depositary Shares evidenced by such 9 14 Receipt and not theretofore sold may be sold for the account of the holder thereof (after attempting by reasonable means to notify such holder prior to such sale), and such dividends, interest payments or other distributions or the proceeds of any such sale may be applied to any payment of such charges or expenses, the holder of such Receipt remaining liable for any deficiency. SECTION 3.03. Warranty as to Stock. The Company hereby represents and warrants that the Stock, when issued, will be duly authorized, validly issued, fully paid and nonassessable. Such representation and warranty shall survive the deposit of the Stock and the issuance of Receipts. ARTICLE IV The Deposited Securities; Notices SECTION 4.01. Cash Distributions. Whenever the Depositary shall receive any cash dividend or other cash distribution on Stock, the Depositary shall, subject to Section 3.01 and 3.02, distribute to record holders of Receipts on the record date fixed pursuant to Section 4.04 such amounts of such dividend or distribution as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders; provided, however, that in case the Company or the Depositary shall be required to withhold and shall withhold from any cash dividend or other cash distribution in respect of the Stock an amount on account of taxes or as otherwise required by law, regulation or court process, the amount made available for distribution or distributed in respect of Depositary Shares shall be reduced accordingly. In the event that the calculation of any such cash dividend or other cash distribution to be paid to any record holder on the aggregate number of Depositary Receipts held by such holder results in an amount which is a fraction of a cent, the amount the Depositary shall distribute to such record holder shall be rounded to the next highest whole cent; and upon request of the Depositary, the Company shall pay the additional amount to the Depositary for distribution. SECTION 4.02. Distributions Other than Cash, Rights, Preferences or Privileges. Whenever the Depositary shall receive any distribution other than cash, rights, preferences or privileges upon Stock, the Depositary shall, subject to Sections 3.01 and 3.02, distribute to record holders of Receipts on the record date fixed pursuant to 10 15 Section 4.04 such amounts of the securities or property received by it as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders, in any manner that the Depositary may deem equitable and practicable for accomplishing such distribution. If in the opinion of the Depositary such distribution cannot be made proportionately among such record holders, or if for any other reason (including any requirement that the Company or the Depositary withhold an amount on account of taxes) the Depositary deems such distribution not to be feasible, the Depositary may adopt such method as it deems equitable and practicable for the purpose of effecting such distribution, including the sale (at public or private sale) of the securities or property thus received, or any part thereof, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Section 3.01 and 3.02, be distributed or made available for distribution, as the case may be, by the Depositary to record holders of Receipts as provided by Section 4.01 in the case of a distribution received in cash. SECTION 4.03. Subscription Rights, Preferences or Privileges. If the Company shall at any time offer or cause to be offered to the persons in whose names Stock is recorded on the books of the Company any rights, preferences or privileges to subscribe for or to purchase any securities or any rights, preferences or privileges of any other nature, such rights, preferences or privileges shall in each such instance be made available by the Depositary to the record holders of Receipts in such manner as the Depositary may determine, either by the issue to such record holders of warrants representing such rights, preferences or privileges or by such other method as may be approved by the Depositary in its discretion with the approval of the Company; provided, however, that (i) if at the time of issue or offer of any such rights, preferences or privileges the Depositary determines that it is not lawful or (after consultation with the Company) not feasible to make such rights, preferences or privileges available to holders of Receipts by the issue of warrants or otherwise, or (ii) if and to the extent so instructed by holders of Receipts who do not desire to exercise such rights, preferences or privileges, then the Depositary, in its discretion (with approval of the Company, in any case where the Depositary has determined that it is not feasible to make such rights, preferences or privileges available), may, if applicable laws or the terms of such rights, preferences or privileges permit such transfer, sell such rights, preferences or privileges at public or private sale, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, 11 16 subject to Sections 3.01 and 3.02, be distributed by the Depositary to the record holders of Receipts entitled thereto as provided by Section 4.01 in the case of a distribution received in cash. If registration under the Securities Act of the securities to which any rights, preferences or privileges relate is required in order for holders of Receipts to be offered or sold the securities to which such rights, preferences or privileges relate, the Company will file promptly a registration statement pursuant to such Act with respect to such rights, preferences or privileges and securities and use its best efforts and take all steps available to it to cause such registration statement to become effective sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. In no event shall the Depositary make available to the holders of Receipts any right, preference or privilege to subscribe for or to purchase any securities unless and until it has received written notice from the Company that such registration statement shall have become effective, or that the offering and sale of such securities to such holders are exempt from registration under the provisions of the Securities Act and the Company shall have provided to the Depositary an opinion of counsel to such effect. If any other action under the laws of any jurisdiction or any governmental or administrative authorization, consent or permit is required in order for such rights, preferences or privileges to be made available to holders of Receipts, the Company will use its reasonable best efforts to take such action or obtain such authorization, consent or permit sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. SECTION 4.04. Notice of Dividends, etc.; Fixing Record Date for Holders of Receipts. Whenever any cash dividend or other cash distribution shall become payable or any distribution other than cash shall be made, or if rights, preferences or privileges shall at any time be offered, with respect to Stock, or whenever the Depositary shall receive notice of any meeting at which holders of Stock are entitled to vote or of which holders of Stock are entitled to notice, or whenever the Depositary and the Company shall decide it is appropriate, the Depositary shall in each such instance fix a record date (which shall be the same date as the record date fixed by the Company with respect to or otherwise in accordance with the terms of the 12 17 Stock) for the determination of the holders of Receipts who shall be entitled to receive such dividend, distribution, rights, preferences or privileges or the net proceeds of the sale thereof, or to give instructions for the exercise of voting rights at any such meeting, or who shall be entitled to notice of such meeting or for any other appropriate reasons. SECTION 4.05. Voting Rights. Upon receipt of notice of any meeting at which the holders of Stock are entitled to vote, the Depositary shall, as soon as practicable thereafter, mail to the record holders of Receipts a notice which shall contain (i) such information as is contained in such notice of meeting and (ii) a statement that the holders may, subject to any applicable restrictions, instruct the Depositary as to the exercise of the voting rights pertaining to the amount of Stock represented by their respective Depositary Shares (including an express indication that instructions may be given to the Depositary to give a discretionary proxy to a person designated by the Company) and a brief statement as to the manner in which such instructions may be given. Upon the written request of the holders of Receipts on the relevant record date, the Depositary shall endeavor insofar as practicable to vote or cause to be voted, in accordance with the instructions set forth in such requests, the maximum number of whole shares of Stock represented by the Depositary Shares evidenced by all Receipts as to which any particular voting instructions are received. The Company hereby agrees to take all reasonable action which may be deemed necessary by the Depositary in order to enable the Depositary to vote such Stock or cause such Stock to be voted. In the absence of specific instructions from the holder of a Receipt, the Depositary will not vote (but, at its discretion, may appear at any meeting with respect to such Stock unless directed to the contrary by the holders of all the Receipts) to the extent of the Stock represented by the Depositary Shares evidenced by such Receipt. SECTION 4.06. Changes Affecting Deposited Securities and Reclassifications, Recapitalizations, etc. Upon any change in par or stated value or liquidation preference, split-up, combination or any other reclassification of the Stock, or upon any recapitalization, reorganization, merger, statutory share exchange or consolidation affecting the Company or to which it is a party, the Depositary may in its discretion with the approval of, and shall upon the instructions of, the Company, and (in either case) in such manner as the Depositary may deem equitable, (i) make such adjustments as are certified by the Company in the fraction of an interest 13 18 represented by one Depositary Share in one share of Stock as may be necessary fully to reflect the effects of such change in par or stated value or liquidation preference, split-up, combination or other reclassification of Stock, or of such recapitalization, reorganization, merger, share exchange or consolidation and (ii) treat any securities which shall be received by the Depositary in exchange for or upon conversion of or in respect of the Stock as new deposited securities so received in exchange for or upon conversion or in respect of such Stock. In any such case the Depositary may in its discretion, with the approval of the Company, execute and deliver additional Receipts or may call for the surrender of all outstanding Receipts to be exchanged for new Receipts specifically describing such new deposited securities. Anything to the contrary herein notwithstanding, holders of Receipts shall have the right from and after the effective date of any such change in par or stated value or liquidation preference, split-up, combination or other reclassification of the Stock or any such recapitalization, reorganization, merger, share exchange or consolidation to surrender such Receipts to the Depositary with instructions to convert, exchange or surrender the Stock represented thereby only into or for, as the case may be, the kind and amount of shares of stock and other securities and property and cash into which the Stock represented by such Receipts might have been converted or for which such Stock might have been exchanged or surrendered immediately prior to the effective date of such transaction. SECTION 4.07. Delivery of Reports. The Depositary shall furnish to holders of Receipts any reports and communications received from the Company which are received by the Depositary as the holder of Stock. SECTION 4.08. List of Receipt Holders. Promptly upon request from time to time by the Company, the Depositary shall furnish to it a list, as of the most recent practicable date, of the names, addresses and holdings of Depositary Shares of all record holders of Receipts. The Company shall be entitled to receive such list twice annually without charge. 14 19 ARTICLE V The Depositary, the Depositary's Agents, the Registrar and the Company SECTION 5.01. Maintenance of Offices, Agencies and Transfer Books by the Depositary; Registrar. Upon execution of this Deposit Agreement, the Depositary shall maintain at the Depositary's Office, facilities for the execution and delivery, registration and registration of transfer, surrender and exchange of Receipts, and at the offices of the Depositary's Agents, if any, facilities for the delivery, registration of transfer, surrender and exchange of Receipts, all in accordance with the provisions of this Deposit Agreement. The Depositary shall keep books at the Depositary's Office for the registration and registration of transfer of Receipts, which books during normal business hours shall be open for inspection by the record holders of Receipts; provided that any such holder requesting to exercise such right shall certify to the Depositary that such inspection shall be for a proper purpose reasonably related to such person's interest as an owner of Depositary Shares evidenced by the Receipts. The Depositary may close such books, at any time or from time to time, when deemed expedient by it in connection with the performance of its duties hereunder. The Depositary may, with the approval of the Company, appoint a Registrar for registration of the Receipts or the Depositary Shares evidenced thereby. If the Receipts or the Depositary Shares evidenced thereby or the Stock represented by such Depositary Shares shall be listed on one or more national stock exchanges, the Depositary will appoint a Registrar (acceptable to the Company) for registration of such Receipts or Depositary Shares in accordance with any requirements of such exchange. Such Registrar (which may be the Depositary if so permitted by the requirements of any such exchange) may be removed and a substitute registrar appointed by the Depositary upon the request or with the approval of the Company. If the Receipts, such Depositary Shares or such Stock are listed on one or more other stock exchanges, the Depositary will, at the request and at the expense of the Company, arrange such facilities for the delivery, registration, registration of transfer, surrender and exchange of such Receipts, such Depositary Shares or such Stock as may be required by law or applicable stock exchange regulation. 15 20 The Depositary may from time to time appoint Depositary's Agents to act in any respect for the Depositary for the purposes of this Deposit Agreement and may at any time appoint additional Depositary's Agents and vary or terminate the appointment of such Depositary's Agents. The Depositary will notify the Company of any such action. SECTION 5.02. Prevention of or Delay in Performance by the Depositary, the Depositary's Agents, the Registrar or the Company. Neither the Depositary nor any Depositary's Agent nor the Registrar nor the Company shall incur any liability to any holder of any Receipt if by reason of any provision of any present or future law, or regulation thereunder, of the United States of America or of any other governmental authority or, in the case of the Depositary, the Depositary's Agent or the Registrar, by reason of any provision, present or future, of the Company's Articles of Incorporation or by reason of any act of God or war or other circumstance beyond the reasonable control of the relevant party, the Depositary, the Depositary's Agent, the Registrar or the Company shall be prevented, delayed or forbidden from, or subjected to any penalty on account of, doing or performing any act or thing which the terms of this Deposit Agreement provide shall be done or performed, nor shall the Depositary, any Depositary's Agent, the Registrar or the Company incur liability to any holder of a Receipt (i) by reason of any nonperformance or delay, caused as aforesaid, in the performance of any act or thing which the terms of this Deposit Agreement shall provide shall or may be done or performed, or (ii) by reason of any exercise of, or failure to exercise, any discretion provided for in this Deposit Agreement except, in the case of any such exercise or failure to exercise discretion not caused as aforesaid, if caused by the negligence or willful misconduct of the party charged with such exercise or failure to exercise. SECTION 5.03. Obligation of the Depositary, the Depositary's Agents, the Registrar and the Company. Neither the Depositary nor any Depositary's Agent nor the Registrar nor the Company assumes any obligation or shall be subject to any liability under this Deposit Agreement or any Receipt to holders of Receipts other than for its negligence, willful misconduct or bad faith. Neither the Depositary nor any Depositary's Agent nor the Registrar nor the Company shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding in respect of the Stock, the Depositary Shares or the Receipts which in its opinion may involve it in expense or liability unless indemnity 16 21 satisfactory to it against all expense and liability be furnished as often as may be required. Neither the Depositary nor any Depositary's Agent nor the Registrar nor the Company shall be liable for any action or any failure to act by it in reliance upon the written advice of legal counsel or accountants, or information from any person presenting Stock for deposit, any holder of a Receipt or any other person believed by it in good faith to be competent to give such information. The Depositary, any Depositary's Agent, the Registrar and the Company may each rely and shall each be protected in acting upon any written notice, request, direction or other document believed by it to be genuine and to have been signed or presented by the proper party or parties. The Depositary shall not be responsible for any failure to carry out any instruction to vote any of the shares of Stock or for the manner or effect of any such vote made, as long as any such action or non-action is in good faith. The Depositary undertakes, and any Registrar shall be required to undertake, to perform such duties and only duties as are specifically set forth in this Deposit Agreement, and no implied covenants or obligations shall be read into this Deposit Agreement against the Depositary or any Registrar. The Depositary will indemnify the Company and hold it harmless from any loss, liability or expense (including the reasonable costs and expenses of defending itself) which may arise out of acts performed or omitted by the Depositary, including when such Depositary acts as Registrar, or the Depositary's Agents in connection with this Deposit Agreement due to its or their negligence, willful misconduct or bad faith. The indemnification obligations of the Depositary set forth in this Section 5.03 shall survive any termination of this Deposit Agreement and any succession of any Depositary. The Depositary, its affiliates or subsidiaries, the Depositary's Agents, and the Registrar may own, buy, sell and deal in any class of securities of the Company and its affiliates and in Receipts or Depositary Shares or become pecuniarily interested in any transaction in which the Company or its affiliates may be interested or contract with or lend money to or otherwise act as fully or as freely as if it were not the Depositary, its affiliate or subsidiary or Depositary's Agent or Registrar hereunder. The Depositary may also act as trustee, transfer agent or registrar of any of the securities of the Company and its affiliates. 17 22 It is intended that neither the Depositary nor any Depositary's Agent nor the Registrar, acting as the Depositary Agent or Registrar, as the case may be, shall be deemed to be an "issuer" of the securities under the federal securities laws or applicable state securities laws, it being expressly understood and agreed that the Depositary, any Depositary's Agent and the Registrar are acting only in a ministerial capacity as Depositary or Registrar for the Stock. Neither the Depositary (or its officers, directors, employees or agents) nor any Depositary's Agent nor the Registrar makes any representation or has any responsibility as to the validity of the registration statement pursuant to which the Depositary Shares are registered under the Securities Act, the Stock, the Depositary Shares or the Receipts (except for its counter-signature thereon) or any instruments referred to therein or herein, or as to the correctness of any statement made therein or herein. The Depositary assumes no responsibility for the correctness of the description that appears in the Receipts, which can be taken as a statement of the Company summarizing certain provisions of this Deposit Agreement. Notwithstanding any other provision herein or in the Receipts, the Depositary makes no warranties or representations as to the validity, genuineness or sufficiency of any Stock at any time deposited with the Depositary hereunder or of the Depositary Shares, as to the validity or sufficiency of this Deposit Agreement, as to the value of the Depositary Shares or as to any right, title or interest of the record holders of Receipts in and to the Depositary Shares. The Depositary shall not be accountable for the use or application by the Company of the Depositary Shares or the Receipts or the proceeds thereof. SECTION 5.04. Resignation and Removal of the Depositary; Appointment of Successor Depositary. The Depositary may at any time resign as Depositary hereunder by delivering notice of its election to do so to the Company, such resignation to take effect upon the appointment of a successor Depositary and its acceptance of such appointment as hereinafter provided. The Depositary may at any time be removed by the Company by notice of such removal delivered to the Depositary, such removal to take effect upon the appointment of a successor Depositary and its acceptance of such appointment as hereinafter provided. 18 23 In case at any time the Depositary acting hereunder shall resign or be removed, the Company shall, within 60 days after the delivery of the notice of resignation or removal, as the case may be, appoint a successor Depositary, which shall be a bank or trust company having its principal office in the United States of America and having a combined capital and surplus of at least [$50,000,000]. If no successor Depositary shall have been so appointed and have accepted appointment within 60 days after delivery of such notice, the resigning or removed Depositary may petition any court of competent jurisdiction for the appointment of a successor Depositary. Every successor Depositary shall execute and deliver to its predecessor and to the Company an instrument in writing accepting its appointment hereunder, and thereupon such successor Depositary, without any further act or deed, shall become fully vested with all the rights, powers, duties and obligations of its predecessor and for all purposes shall be the Depositary under this Deposit Agreement, and such predecessor, upon payment of all sums due it and on the written request of the Company, shall execute and deliver an instrument transferring to such successor all rights and powers of such predecessor hereunder, shall duly assign, transfer and deliver all right, title and interest in the Stock and any moneys or property held hereunder to such successor, and shall deliver to such successor a list of the record holders of all outstanding Receipts and such records, books and other information in its possession relating thereto. Any successor Depositary shall promptly mail notice of its appointment to the record holders of Receipts. Any corporation into or with which the Depositary may be merged, consolidated or converted shall be the successor of such Depositary without the execution or filing of any document or any further act, and notice thereof shall not be required hereunder. Such successor Depositary may authenticate the Receipts in the name of the predecessor Depositary or in the name of the successor Depositary. SECTION 5.05. Corporate Notices and Reports. The Company agrees that it will deliver to the Depositary, and the Depositary will, promptly after receipt thereof transmit to the record holders of Receipts, in each case at the addresses recorded in the Depositary's books, copies of all notices and reports (including without limitation financial statements) required by law or by the rules of any national securities exchange upon which the Stock, the Depositary Shares or the Receipts are listed, to be furnished to the record holders of Receipts or otherwise determine to furnish. Such transmission will be at the Company's expense and the Company will provide the Depositary with such number 19 24 of copies of such documents as the Depositary may reasonably request. SECTION 5.06. Indemnification by the Company. The Company shall indemnify the Depositary, any Depositary's Agent and the Registrar against, and hold each of them harmless from, any loss, liability or expense (including the reasonable costs and expenses of defending itself) which may arise out of acts performed or omitted in connection with this Deposit Agreement and the Receipts by the Depositary, any Registrar or any of their respective agents (including any Depositary's Agent), except for any liability arising out of negligence, willful misconduct or bad faith on the respective parts of any such person or persons. The obligations of the Company set forth in this Section 5.06 shall survive any succession of any Depositary or Depositary's Agent. SECTION 5.07. Charges and Expenses. The Company shall pay all transfer and other taxes and governmental charges arising solely from the existence of the depositary arrangements. The Company shall pay all charges of the Depositary in connection with the initial deposit of the Stock and the initial issuance of the Depositary Shares, all withdrawals of shares of the Stock by owners of Depositary Shares, and any redemption or exchange of the Stock at the option of the Company. All other transfer and other taxes and governmental charges shall be at the expense of holders of Depositary Shares. If, at the request of a holder of Receipts, the Depositary incurs charges or expenses for which it is not otherwise liable hereunder, such holder will be liable for such charges and expenses. All other charges and expenses of the Depositary and any Depositary's Agent hereunder (including, in each case, reasonable fees and expenses of counsel) incident to the performance of their respective obligations hereunder will be paid upon consultation and agreement between the Depositary and the Company as to the amount and nature of such charges and expenses. The Depositary shall present its statement for charges and expenses to the Company at such intervals as the Company and the Depositary may agree. SECTION 5.08. Tax Compliance. The Depositary, on its own behalf and on behalf of the Company will comply with all applicable certification, information reporting and withholding (including "backup" withholding) requirements imposed by applicable tax laws, regulations or administrative practice with respect to (i) any payments made with respect to the Depositary Shares or (ii) the issuance, delivery, holding, transfer, redemption or exercise of rights under the Receipts or the Depositary 20 25 Shares. Such compliance shall include, without limitation, the preparation and timely filing of required returns and the timely payment of all amounts required to be withheld to the appropriate taxing authority or its designated agent. The Depositary shall comply with any direction received from the Company with respect to the application of such requirements to particular payments or holders or in other particular circumstances, and may for purposes of this Deposit Agreement rely on any such direction in accordance with the provisions of Section 5.03 hereof. The Depositary shall maintain all appropriate records documenting compliance with such requirements, and shall make such records available on request to the Company or to its authorized representatives. ARTICLE VI Amendment and Termination SECTION 6.01. Amendment. The form of the Receipts and any provisions of this Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect which they may deem necessary or desirable; provided, however, that no such amendment (other than any change in the fees of any Depositary or Registrar, which shall go into effect not sooner than three months after notice thereof to the holders of the Receipts) which shall materially and adversely alter the rights of the holders of Receipts shall be effective unless such amendment shall have been approved by the holders of at least a majority of the Depositary Shares then outstanding. Every holder of an outstanding Receipt at the time any such amendment becomes effective shall be deemed, by continuing to hold such Receipt, to consent and agree to such amendment and to be bound by the Deposit Agreement as amended thereby. SECTION 6.02. Termination. This Deposit Agreement may be terminated by the Company or the Depositary only after (i) all outstanding Depositary Shares have been redeemed pursuant to Section 2.08 or (ii) there shall have been made a final distribution in respect of the Stock in connection with any liquidation, dissolution or winding up of the Company and such distribution shall have been distributed to the holders of Depositary Receipts pursuant to Sections 4.01 or 4.02, as applicable. 21 26 If any Receipts shall remain outstanding after the date of termination of this Deposit Agreement, the Depositary thereafter shall discontinue the transfer of Receipts, shall suspend the distribution of dividends to the holders thereof and shall not give any further notices (other than notice of such termination) or perform any further acts under this Deposit Agreement, except that the Depositary shall continue to collect dividends and other distributions pertaining to Stock, shall sell rights, preferences or privileges as provided in this Deposit Agreement and shall continue to deliver the Stock and any money and other property represented by Receipts upon surrender thereof by the holders thereof. At any time after the expiration of two years from the date of termination, the Depositary may sell Stock then held hereunder at public or private sale, at such places and upon such terms as it deems proper and may thereafter hold the net proceeds of any such sale, together with any money and other property held by it hereunder, without liability for interest, for the benefit, pro rata in accordance with their holdings, of the holders of Receipts that have not theretofore been surrendered. After making such sale, the Depositary shall be discharged from all obligations under this Deposit Agreement except to account for such net proceeds and money and other property. Upon the termination of this Deposit Agreement, the Company shall be discharged from all obligations under this Deposit Agreement except for its obligations to the Depositary, the Registrar and any Depositary's Agent under Sections 5.06 and 5.07. ARTICLE VII Miscellaneouss SECTION 7.01. Counterparts. This Deposit Agreement may be executed in any number of counterparts, and by each of the parties hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed an original, but all such counterparts taken together shall constitute one and the same instrument. SECTION 7.02. Exclusive Benefit of Parties. This Deposit Agreement is for the exclusive benefit of the parties hereto, and their respective successors hereunder, and shall not be deemed to give any legal or equitable right, remedy or claim to any other person whatsoever. 22 27 SECTION 7.03. Invalidity of Provisions. In case any one or more of the provisions contained in this Deposit Agreement or in the Receipts should be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein or therein shall in no way be affected, prejudiced or disturbed thereby. SECTION 7.04. Notices. Any and all notices to be given to the Company hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail, or by telegram or facsimile transmission confirmed by letter, addressed to the Company at The Chubb Corporation 15 Mountain View Road P.O. Box 1615 Warren, New Jersey 07061-1615 Attention: Corporate Secretary Facsimile No.: (___) ______-________ or at any other address of which the Company shall have notified the Depositary in writing. Any and all notices to be given to the Depositary hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail, or by telegram or facsimile transmission confirmed by letter, addressed to the Depositary at the Depositary's Office, at: [ ] Attention: [ ] Facsimile No.: [ ] or at any other address of which the Depositary shall have notified the Company in writing. Any and all notices to be given to any record holder of a Receipt hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail, or by telegram or facsimile transmission confirmed by letter, addressed to such record holder at the address of such record holder as it appears on the books of the Depositary, or if such holder shall have filed with the Depositary a written request that notices intended for such holder be mailed to some other address, at the address designated in such request. 23 28 Delivery of a notice sent by mail or by telegram or facsimile transmission shall be deemed to be effected at the time when a duly addressed letter containing the same (or a confirmation thereof in the case of a telegram or facsimile transmission) is deposited, postage prepaid, in a post office letter box. The Depositary or the Company may, however, act upon any telegram or facsimile transmission received by it from the other or from any holder of a Receipt, notwithstanding that such telegram or facsimile transmission shall not subsequently be confirmed by letter or as aforesaid. SECTION 7.05. Appointment of Registrar. The Company hereby also appoints the Depositary as Registrar in respect of the Receipts and the Depositary hereby accepts such appointments. SECTION 7.06. Holders of Receipts are Parties. The holders of Receipts from time to time shall be parties to this Deposit Agreement and shall be bound by all of the terms and conditions hereof and of the Receipts by acceptance of delivery thereof. SECTION 7.07. GOVERNING LAW. THIS DEPOSIT AGREEMENT AND THE RECEIPTS AND ALL RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS HEREOF AND THEREOF SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. SECTION 7.08. Inspection of Deposit Agreement. Copies of this Deposit Agreement shall be filed with the Depositary and the Depositary's Agent and shall be open to inspection during business hours at the Depositary's Office or respective offices of the Depositary's Agent, if any, by any holder of a Receipt. SECTION 7.09. Headings. The headings of articles and sections in this Deposit Agreement and in the form of the Receipt set forth in Annex A hereto have been inserted for convenience only and are not to be regarded as a part of this Deposit Agreement or the Receipts or to have any bearing upon the meaning or interpretation of any provision contained herein or in the Receipts. IN WITNESS WHEREOF, the Company and the Depositary have duly executed this Deposit Agreement as of the date and year first above set forth, and all holders of Receipts shall 24 29 become parties hereto by and upon acceptance by them of delivery of Receipts issued in accordance with the terms hereof. The Chubb Corporation Attested by ________________________ By_______________________ [SEAL] Attested by [ ] ________________________ By_______________________ [SEAL] 25 30 ANNEX A TEMPORARY RECEIPT EXCHANGEABLE FOR CERTIFICATE FOR DEFINITIVE ENGRAVED RECEIPT WHEN READY [ ] FOR DELIVERY DEPOSITARY SHARES THE DEPOSITARY SHARES REPRESENTED BY THIS TRANSFERABLE RECEIPT ARE NOT SAVINGS ACCOUNTS, DEPOSITS DEPOSITARY RECEIPT OR OTHER OBLIGATIONS OF _____________, THE This Certificate is DEPOSITARY HEREUNDER, OR OF ANY BANK OR transferable in NON-BANK DEPOSITARY OF THE CHUBB CORPORA- New York, New York TION AND ARE NOT INSURED BY THE SAVINGS ASSOCIATION INSURANCE FUND OR THE BANK INSURANCE FUND OF THE FEDERAL CUSIP [ ] DEPOSIT INSURANCE CORPORATION, OR ANY SEE REVERSE FOR OTHER GOVERNMENT AGENCY CERTAIN DEFINITIONS DEPOSITARY RECEIPT FOR DEPOSITARY SHARES, EACH DEPOSITARY SHARE REPRESENTING A [ ] INTEREST IN ONE SHARE OF [ % PREFERRED STOCK] THE CHUBB CORPORATION A CORPORATION INCORPORATED UNDER THE LAWS OF THE STATE OF NEW JERSEY [ ], as Depositary (the "Depositary"), hereby certifies that is the registered owner of ___________________ DEPOSITARY SHARES ("Depositary Shares"), each Depositary Share representing a [ ] interest in one share of [ % Preferred Stock], without par value, (the "Stock"), of The Chubb Corporation, a New Jersey corporation (the "Corporation"), on deposit with the Depositary, subject to the terms and entitled to the benefits of the Deposit Agreement dated as of [ ] (the "Deposit Agreement"), between the Corporation and the Depositary. By accepting this Depositary Receipt, the holder hereof becomes a party to and agrees to be bound by all the terms and conditions of the Deposit Agreement. This Depositary Receipt shall not be valid or obligatory for any purpose or be entitled to any benefits under the Deposit Agreement unless it shall have been executed by the Depositary by the manual signature of a duly authorized officer or, if executed in facsimile by the Depositary, countersigned by A-1 31 a Registrar in respect of the Depositary Receipts by a duly authorized officer thereof. Dated: Countersigned [ ] Depositary and Registrar By Authorized Officer A-2 32 THE CHUBB CORPORATION THE CHUBB CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH RECEIPT-HOLDER WHO SO REQUESTS A COPY OF THE DEPOSIT AGREEMENT AND A STATEMENT OR SUMMARY OF THE ARTICLES OF SUPPLEMENTARY ESTABLISHING THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIFIED RIGHTS OF THE [ ]% PREFERRED STOCK AND EACH OTHER CLASS OF PREFERRED STOCK OR SERIES THEREOF WHICH THE CORPORATION IS AUTHORIZED TO ISSUE AND OF THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCE AND/OR RIGHTS. ANY SUCH REQUEST SHOULD BE ADDRESSED TO THE CHUBB CORPORATION, ATTENTION: SECRETARY, 15 MOUNTAIN VIEW ROAD, P.O. BOX 1615, WARREN, NEW JERSEY 07061-1615. ____________________ The following abbreviations, when used in the inscription on the face of this Depositary Receipt, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common UNIF GIFT MIN ACT - ______ Custodian _______ (Cust) (Minor) under Uniform Gifts to Minors Act____________ (State) UNIF TRAN MIN ACT - ______ Custodian (until age __) (Cust) _______ under Uniform Transfers (Minor) to Minors Act ________________ (State) Additional abbreviations may also be used though not in the above list. A-3 33 For value received, _____________________ hereby sell(s), assign(s) and transfer(s) unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE ______________________________________ ______________________________________ _______________________________________________________________________________ _______________________________________________________________________________ PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE _______________________________________________________________________________ ___________________ Depositary Shares represented by the within Depositary Receipt, and do(es) hereby irrevocably constitute and appoint ______________________ Attorney to transfer the said Depositary Shares on the books of the within named Depositary with full power of substitution in the premises. Dated______________________ Signature: _________________________ NOTICE: The signature to this assignment must correspond with the name as written upon the face of this Depositary Receipt in every particular, without alteration or enlargement or any change whatever. SIGNATURE GUARANTEE ___________________________ A-4 EX-4.12 9 COMMON & PREFERRED STOCK WARRANT AGREEMENT 1 Exhibit 4.12 ================================================================================ THE CHUBB CORPORATION AND _______________________ as Stock Warrant Agent _______________________ STOCK WARRANT AGREEMENT Dated as of __________________ _____________________ ================================================================================ 2 TABLE OF CONTENTS* PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 1. Appointment of Stock Warrant Agent . . . . . . . . . . . . . . . . . . . . . . . . . . 1 SECTION 2. Form of Stock Warrant Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . 1 SECTION 3. Execution of Stock Warrant Certificates . . . . . . . . . . . . . . . . . . . . . . . 1 SECTION 4. Registration and Countersignature . . . . . . . . . . . . . . . . . . . . . . . . . . 2 SECTION 5. Registration of Transfers and Exchanges . . . . . . . . . . . . . . . . . . . . . . . 2 SECTION 6. Duration and Exercise of Stock Warrants . . . . . . . . . . . . . . . . . . . . . . . 3 SECTION 7. Payment of Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 SECTION 8. Mutilated, Lost, Stolen or Destroyed Stock Warrant Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 SECTION 9. Reservation of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 SECTION 10. Obtaining of Governmental Approvals and Stock Exchange Listings; Registration of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 SECTION 11. Adjustment of Exercise Price and Number of Shares Purchasable or Number of Stock Warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 SECTION 12. Optional Reduction of Exercise Price . . . . . . . . . . . . . . . . . . . . . . . . . 11 SECTION 13. Fractional Stock Warrants and Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 SECTION 14. Notices to Stock Warrant Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 SECTION 15. Merger, Consolidation or Change of Name of Stock Warrant Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 SECTION 16. Stock Warrant Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
__________________________________ *THIS TABLE OF CONTENTS DOES NOT CONSTITUTE A PART OF THIS AGREEMENT OR HAVE ANY BEARING UPON THE INTERPRETATION OF ANY OF ITS TERMS OR PROVISIONS. i 3 SECTION 17. Disposition of Proceeds of Exercise of Stock Warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 SECTION 18. Change of Stock Warrant Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 SECTION 19. Notices to Company and Stock Warrant Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 SECTION 20. Supplements and Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 SECTION 21. Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 SECTION 22. Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 SECTION 23. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 SECTION 24. Benefits of this Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 SECTION 25. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . EXHIBIT A. Form of Stock Warrant Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . 23
ii 4 STOCK WARRANT AGREEMENT dated as of _________________, 199_, between THE CHUBB CORPORATION, a New Jersey corporation (the "Company"), and _____________________, a banking association organized under the laws of the State of ____________, as Stock Warrant Agent (the "Stock Warrant Agent"). WHEREAS, the Company proposes to issue and sell stock warrants ("Stock Warrants") to purchase shares of the Company's Common Stock, $1.00 par value per share ("Common Stock"), each whole Stock Warrant exercisable to purchase one share of Common Stock (such shares which may be purchased upon the exercise of Stock Warrants at any time being hereinafter referred to as the "Shares"); and WHEREAS, the Company desires the Stock Warrant Agent to act on behalf of the Company, and the Stock Warrant Agent is willing so to act, in connection with the issuance and exercise of Stock Warrants and the registration, transfer, exchange and replacement of Stock Warrant Certificates and other matters as provided herein; NOW, THEREFORE, in consideration of the premises and the mutual agreements herein set forth, the parties hereto agree as follows: SECTION 1. Appointment of Stock Warrant Agent. The Company hereby appoints the Stock Warrant Agent to act as agent for the Company in accordance with the instructions set forth hereinafter in this Agreement, and the Stock Warrant Agent hereby accepts such appointment. SECTION 2. Form of Stock Warrant Certificates. The Stock Warrant Certificates to be delivered pursuant to this Agreement shall be in registered form only and shall be substantially in the form set forth in Exhibit A attached hereto, and may have such letters, numbers or other marks of identification or designation or such legends, summaries or endorsements printed, lithographed or engraved thereon as the Company may deem appropriate and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any applicable law or with any rule or regulation under such law. SECTION 3. Execution of Stock Warrant Certificates. Stock Warrant Certificates shall be signed on behalf of the Company by its Chairman of the Board of Directors, President, an Executive Vice President, a Senior Vice President or a Vice President and shall be attested by its Secretary or an Assistant Secretary under its corporate seal. Each such signature upon the Stock Warrant Certificates may be in the form of a facsimile signature of the present or any future Chairman of the Board of 5 Directors, President, Executive Vice President, Senior Vice President, Vice President, Secretary or Assistant Secretary. The Seal of the Company may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Stock Warrant Certificates. If the Chairman of the Board of Directors or any officer of the Company who shall have signed any of the Stock Warrant Certificates shall cease to be such Chairman of the Board of Directors or officer before the Stock Warrant Certificates so signed shall have been countersigned by the Stock Warrant Agent and delivered to or disposed of by the Company, such Stock Warrant Certificates nevertheless may be countersigned and delivered to or disposed of as though such person had not ceased to be such Chairman of the Board of Directors or officer of the Company; and any Stock Warrant Certificate may be signed on behalf of the Company by any person who, at the actual date of the execution of such Stock Warrant Certificate, was such Chairman of the Board of Directors or officer although at the date of this Stock Warrant Agreement any such person was not such Chairman of the Board of Directors or officer. In connection with the initial issuance of the Stock Warrant Certificates, upon receipt of Stock Warrant Certificates executed by the Company and a written order of the Company executed by its Chairman of the Board of Directors, President, an Executive Vice President, a Senior Vice President, a Vice President, Secretary or an Assistant Secretary, the Stock Warrant Agent will countersign and deliver Stock Warrant Certificates in accordance with the instructions contained in such order. Stock Warrant Certificates shall be dated the date of countersignature by the Stock Warrant Agent. SECTION 4. Registration and Countersignature. Stock Warrant Certificates distributed as provided in Section 11 shall be registered in the names of the record holders of the Stock Warrant Certificates to whom they are to be distributed. Stock Warrant Certificates shall be manually countersigned by the Stock Warrant Agent and shall not be valid for any purpose unless so countersigned. The Company and the Stock Warrant Agent may deem and treat the registered holder of a Stock Warrant Certificate as the absolute owner thereof (notwithstanding any notation of ownership or other writing thereon made by anyone), for the purpose of any exercise thereof and any distribution to the holder thereof and for all other purposes, and neither the Company nor the Stock Warrant Agent shall be affected by any notice to the contrary. 2 6 SECTION 5. Registration of Transfers and Exchanges. The Stock Warrant Agent shall from time to time register the transfer of any outstanding Stock Warrant Certificates upon the records to be maintained by it for that purpose, upon surrender thereof duly endorsed, or accompanied (if so required by it) by a written instrument or instruments of transfer in form satisfactory to the Stock Warrant Agent, duly executed by the registered holder or holders thereof or by the duly appointed legal representative thereof or by a duly authorized attorney. Upon any such registration of transfer, a new Stock Warrant Certificate shall be issued to the transferee and the surrendered Stock Warrant Certificate shall be canceled by the Stock Warrant Agent. The Stock Warrant Agent shall destroy canceled Stock Warrant Certificates and deliver a certificate of such destruction to the Company. One or more Stock Warrant Certificates may be exchanged at the option of the holder thereof, when surrendered to the Stock Warrant Agent at its office maintained for the purpose of exchanging, transferring and exercising the Stock Warrants in the Borough of Manhattan, The City of New York, State of New York (the "Stock Warrant Agent Office") or at the office of any successor Stock Warrant Agent as provided in Section 18 hereof, for another Stock Warrant Certificate or other Stock Warrant Certificates of like tenor and representing in the aggregate a like number of Stock Warrants. Stock Warrant Certificates surrendered for exchange or transfer shall be canceled by the Stock Warrant Agent. Such canceled Stock Warrant Certificates shall be destroyed by the Stock Warrant Agent and a certificate of such destruction shall be delivered to the Company. The Stock Warrant Agent is hereby authorized to countersign, in accordance with the provisions of this Section 5 and of Section 4, and deliver the new Stock Warrant Certificates required pursuant to the provisions of this Section and for the purpose of any distribution of Stock Warrant Certificates contemplated by Section 11. SECTION 6. Duration and Exercise of Stock Warrants. The Stock Warrants shall expire on (i) the close of business on ____________ or (ii) such earlier date after _______________ as shall be determined by the Company and of which 90 days prior notice to the registered holders of Stock Warrants and the Stock Warrant Agent shall have been given in accordance with the provisions of Sections 14 and 19 hereof, if the closing sale price of the Company's Common Stock (New York Stock Exchange composite transactions) shall be not less than 125 percent of the then current Stock Warrant exercise price for 20 trading days in a period of 30 consecutive trading days ending not more than 10 calendar days immediately prior to the date of such notice (such date of expiration being herein referred to as the "Expiration 3 7 Date"). Each Stock Warrant may be exercised on any business day prior to the close of business on the Expiration Date. After the close of business on the Expiration Date, the Stock Warrants will become wholly void and of no value. No fractional Shares shall be issued upon surrender of Stock Warrant Certificates but, in lieu of fractional Shares, the registered holder of Stock Warrant Certificates may elect (a) to be paid an amount in cash equal to the same fraction of the current market value of a Share of Common Stock or (b) to have the amount of the cash payment determined in (a) credited against the Exercise Price payable for Shares to be received upon exercise of the holder's whole Stock Warrants. For purposes of (a) and (b), the current market value of Common Stock shall be the closing price of a Share of Common Stock (determined pursuant to the second sentence of Section 11(d)) on the last trading day immediately prior to the day on which a Stock Warrant is exercised. Subject to the provisions of this Agreement, including Section 11, the holder of each whole Stock Warrant shall have the right to purchase from the Company (and the Company shall issue and sell to such holder) one fully paid and nonassessable Share at the initial exercise price (the "Exercise Price") of $_____ upon the surrender on any business day prior to the close of business on the Expiration Date to the Stock Warrant Agent at the Stock Warrant Agent Office of the Stock Warrant Certificate evidencing such Stock Warrant, with the form of election to exercise on the reverse thereof duly filled in and signed, and upon payment of the Exercise Price in lawful money of the United States of America by means of a certified or official bank check payable to the Company. The Stock Warrants evidenced by a Stock Warrant Certificate shall be exercisable prior to the close of business on the Expiration Date, at the election of the registered holder thereof, either as an entirety or from time to time for part of the number of Stock Warrants specified in the Stock Warrant Certificates, but in no event shall any fractional Share be issued with regard to such Stock Warrant Certificates. In the event that less than all the Stock Warrant Certificates evidenced by a Stock Warrant Certificate surrendered upon the exercise of Stock Warrants are exercised at any time prior to the close of business on the Expiration Date, a new Stock Warrant Certificate or Certificates will be issued for the remaining number of Stock Warrants. No adjustments shall be made for any cash dividends on Shares issuable on the exercise of a Stock Warrant. Subject to Section 7, upon such surrender of a Stock Warrant Certificate, and payment of the Exercise Price, the Stock Warrant Agent shall requisition from ________________, New York, 4 8 New York the transfer agent for the Common Stock (the "Transfer Agent"), for issuance and delivery to or upon the written order of the registered holder of such Stock Warrant Certificate and in such name or names as such registered holder may designate, a certificate for the Share or Shares issuable upon the exercise of the Stock Warrants evidenced by such Stock Warrant Certificates. Such certificate shall be deemed to have been issued and any person so designated to be named therein shall be deemed to have become the holder of record of such Share or Shares as of the date of the surrender of such Stock Warrant Certificates and payment of the Exercise Price. The Stock Warrant Agent is hereby authorized to countersign and deliver the required new Stock Warrant Certificate or Certificates pursuant to the provisions of this Section 6 and of Section 5. All Stock Warrant Certificates surrendered upon exercise of Stock Warrants shall be canceled by the Stock Warrant Agent. Such canceled Stock Warrant Certificates shall then be destroyed by the Stock Warrant Agent and a certificate of such destruction shall be sent to the Company. SECTION 7. Payment of Taxes. The Company will pay all documentary stamp taxes attributable to the initial issuance of Shares upon the exercise of Stock Warrants; provided, however, that the Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer involved in the issue of any Stock Warrant Certificates or any certificates for Shares in a name other than that of the registered holder of a Stock Warrant Certificate surrendered upon the exercise of a Stock Warrant, and the Company shall not be required to issue or deliver such certificates unless or until the person or persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid. SECTION 8. Mutilated, Lost, Stolen or Destroyed Stock Warrant Certificates. If any Stock Warrant Certificate is mutilated, lost, stolen or destroyed, the Company may in its discretion issue, and the Stock Warrant Agent shall countersign and deliver, in exchange and substitution for and upon cancellation of the mutilated Stock Warrant Certificate, or in lieu of and substitution for the Stock Warrant Certificate lost, stolen or destroyed, a new Stock Warrant Certificate of like tenor and representing the same number of Stock Warrants, but only upon receipt of evidence satisfactory to the Company and the Stock Warrant Agent of such loss, theft or destruction of such Stock Warrant Certificate and indemnity or bond, if requested, also satisfactory to them. Applicants for such substitute Stock Warrant Certificates shall also comply with such other reasonable regulations and pay such other reasonable charges as the Company or the Stock Warrant Agent may prescribe. 5 9 SECTION 9. Reservation of Shares. For the purpose of enabling it to satisfy any obligation to issue Shares upon exercise of Stock Warrants, the Company will at all times through the close of business on the Expiration Date, reserve and keep available, free from preemptive rights and out of its aggregate authorized but unissued Common Stock, the number of Shares deliverable upon the exercise of all outstanding Stock Warrants and the Transfer Agent for such Common Stock are hereby irrevocably authorized and directed at all times to reserve such number of authorized and unissued shares of Common Stock as shall be required for such purpose. The Company will deposit a copy of this Agreement with such Transfer Agent. The Stock Warrant Agent is hereby irrevocably authorized to requisition from time to time from such Transfer Agent stock certificates issuable upon exercise of outstanding Stock Warrants, and the Company will supply such Transfer Agent with duly executed stock certificates for such purpose. Before taking any action which would cause an adjustment pursuant to Section 11 reducing the Exercise Price below the then par value (if any) of the Shares issuable upon exercise of the Stock Warrants, the Company will take any corporate action which may, in the opinion of its counsel (which may be counsel employed by the Company), be necessary in order that the Company may validly and legally issue fully paid and nonassessable Shares at the Exercise Price as so adjusted. The Company covenants that all Shares issued upon exercise of the Stock Warrants will, upon issuance in accordance with the terms of this Agreement, be fully paid and nonassessable and free from all preemptive rights and taxes, liens, charges and security interests created by the Company with respect to the issuance and holding thereof. SECTION 10. Obtaining of Governmental Approvals and Stock Exchange Listings; Registrations of Shares. The Company from time to time will use its best efforts (i) to obtain and keep effective any and all permits, consents and approvals of governmental agencies and authorities and to file such documents under federal and state securities laws, which may be or become requisite in connection with the issuance, sale, transfer and delivery of the Stock Warrant Certificates and the exercise of the Stock Warrants; provided, however, if any such permits, consents, approvals or documents are not so obtained or effective, the Company will immediately notify the Stock Warrant Agent; (ii) to have the Stock Warrants listed on the New York Stock Exchange or on the principal United States securities exchange or exchanges on which the Common Stock is listed; (iii) immediately upon the issuance of Shares upon exercise of Stock Warrants, to have such Shares listed on the New York Stock Exchange or on the principal United States securities exchange or 6 10 exchanges on which the Common Stock is listed; and (iv) immediately upon any adjustment in the number of Shares purchasable upon exercise of the Stock Warrants to register such Shares with the Securities and Exchange Commission under the Securities Act of 1933, as amended. SECTION 11. Adjustment of Exercise Price and Number of Shares Purchasable or Number of Stock Warrants. The Exercise Price, the number of Shares purchasable upon the exercise of each Stock Warrant and the number of Stock Warrants outstanding are subject to adjustment from time to time upon the occurrence of the events enumerated in this Section 11. (a) If the Company shall at any time after the date of this Agreement (i) declare a dividend on the Common Stock payable in shares of Common Stock; (ii) subdivide the outstanding Common Stock; (iii) combine the outstanding Common Stock into a smaller number of shares; or (iv) issue any shares of its capital stock in a reclassification of the Common Stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing corporation), the Exercise Price in effect at the time of the record date for such dividend or of the effective date of such subdivision, combination or reclassification, and/or the number and kind of shares of capital stock issuable on such date, shall be proportionately adjusted so that the holders of any Stock Warrant exercised after such time shall be entitled to receive the aggregate number and kind of shares of capital stock which, if such Stock Warrant had been exercised immediately prior to such date, such Stock Warrant holder would have owned upon such exercise and been entitled to receive by virtue of such dividend, subdivision, combination or reclassification. Such adjustment shall be made successively whenever any event listed above shall occur. (b) If the Company shall at any time after the date of this Agreement issue rights or warrants to all holders of Common Stock entitling them to subscribe for or purchase Common Stock (or securities convertible into Common Stock) at a price per share of Common Stock (or having a conversion price per share of Common Stock, if a security convertible into Common Stock) that is less than 95 percent of the then current market price per share of Common Stock (as defined in Section 11(d)) on the record date fixed for such issuance, the Exercise Price in effect after such record date shall be determined by multiplying the Exercise Price in effect immediately prior to such record date by a fraction, of which the numerator shall be the number of shares of Common Stock outstanding on such record date plus the number of shares of Common Stock which the aggregate offering price of the total number of shares of Common Stock so to be offered (or the aggregate initial conversion price of the convertible securities so to be offered) would purchase at such current market price and 7 11 of which the denominator shall be the number of shares of Common Stock outstanding on such record date plus the number of additional shares of Common Stock to be offered for subscription or purchase (or into which the convertible securities so to be offered are initially convertible). If such subscription price may be paid in consideration part or all of which shall be in a form other than cash, the value of such consideration shall be determined by the Board of Directors of the Company, whose determination shall be conclusive. Shares of Common Stock owned by or held for the account of the Company or any majority-owned subsidiary shall not be deemed outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a record date is fixed; and if such rights or warrants are not so issued, the Exercise Price shall again be adjusted to be the Exercise Price which would then be in effect if such record date had not been fixed, but such subsequent adjustments shall not affect the number of Shares issued upon any exercise of Stock Warrants prior to the date such subsequent adjustment is made. (c) If the Company shall fix a record date for the making of a distribution to all holders of Common Stock (including any such distribution made in connection with a consolidation or merger in which the Company is the continuing corporation) of evidences of indebtedness or assets (excluding (i) cash dividends or distributions paid from consolidated earnings or consolidated earned surplus of the Company (determined in accordance with generally accepted accounting principles), or (ii) quarterly Common Stock dividends at the rate of $___ per share or increases therein out of consolidated net income of the Company (determined in accordance with generally accepted accounting principles) for the period from the end of its most recent fiscal year to the date of the most recent consolidated quarterly financial statements of the Company as of the time of the declaration of the dividend, or subscription rights or warrants (excluding those referred to in Section 11(b)), the Exercise Price in effect after such record date shall be determined by multiplying the Exercise Price in effect immediately prior to such record date by a fraction, of which the numerator shall be the current market price per share of Common Stock (as defined in Section 11(d)) on such record date less the fair market value (determined by the Board of Directors of the Company, whose determination shall be conclusive, and described in a statement filed with the Stock Warrant Agent) of the portion of the assets or evidences of indebtedness so to be distributed or of such subscription rights or warrants allocable to one share of Common Stock and of which the denominator shall be such current market price per share of Common Stock. Such adjustment shall be made successively whenever such a record date is fixed; and if such distribution is not so made, the Exercise Price shall again be adjusted to be the Exercise Price which would then be in 8 12 effect if such record date had not been fixed, but such subsequent adjustment shall not affect the number of Shares issued upon any exercise of Stock Warrants prior to the date such subsequent adjustment is made. (d) For the purpose of any computation under Section 11(b), (c) or as elsewhere referenced in this Agreement, the current market price per share of Common Stock or Stock Warrants on any date shall be deemed to be the average of the daily closing prices, respectively, for the Common Stock and the Stock Warrants, for the 30 consecutive trading days commencing 45 trading days before such date. The closing price for each day shall be as reported as New York Stock Exchange composite transactions. (e) No adjustment in the Exercise Price shall be required unless such adjustment would require an increase or decrease of at least 1 percent in such price; provided, however, that (x) any adjustments which by reason of this Section 11(e) are not required to be made shall be carried forward and taken into account in any subsequent adjustment and (y) notwithstanding the provisions of this subsection, any adjustments in the Exercise Price will be made not later than the third anniversary of the occurrence of the event upon which such adjustment is based. All calculations under this Section 11 shall be made to the nearest cent or to the nearest one-hundredth of a Share, as the case may be, but in no event shall the Company be obligated to issue a fractional Share upon the exercise of any Stock Warrant. (f) In the event that at any time, as a result of an adjustment made pursuant to Section 11(a), the holder of any Stock Warrant thereafter exercised shall become entitled to receive any shares of capital stock of the Company other than shares of Common Stock, thereafter the number of such other shares so receivable upon exercise of any Stock Warrant shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Shares contained in Section 11(a) through (c), inclusive, and the provisions of Section 6, 7, 9, 10, 11(e), 11(j) and 13 with respect to the Shares shall apply on like terms to any such other shares. (g) In any case in which this Section 11 shall require that an adjustment in the Exercise Price be made effective as of a record date for a specified event, the Company may elect to defer until the occurrence of such event the issuing to the holder of any Stock Warrant exercised after such record date of the Shares and other capital stock of the Company, if any, issuable upon such exercise over and above the Shares and other capital stock of the Company, if any, issuable upon such exercise 9 13 on the basis of the Exercise Price in effect prior to such adjustment; provided, however, that the Company shall deliver to such holder a due bill or other appropriate instrument evidencing such holder's right to receive such additional shares upon the occurrence of the event requiring such adjustment. (h) Unless the Company has exercised its election to adjust the number of Stock Warrants as provided in Section 11(i), upon each adjustment of the Exercise Price as a result of the calculations made in Section 11(a), (b) or (c), each Stock Warrant outstanding immediately prior to the making of such adjustment shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number of Shares (calculated to the nearest hundredth) obtained by (A) multiplying the number of Shares purchasable upon exercise of a Stock Warrant immediately prior to such adjustment of the number of Shares by the Exercise Price in effect immediately prior to such adjustment of the Exercise Price and (B) dividing the product so obtained by the Exercise Price in effect immediately after such adjustment of the Exercise Price. (i) The Company may elect on or after the date of any adjustment of the Exercise Price to adjust the number of Stock Warrants, in substitution for an adjustment in the number of Shares purchasable upon the exercise of a Stock Warrant as provided in Section 11(h). Each Stock Warrant outstanding after such adjustment of the number of Stock Warrants shall be exercisable for the same number of Shares as immediately prior to such adjustment. Each Stock Warrant held of record prior to such adjustment of the number of Stock Warrants shall become that number of Stock Warrants (calculated to the nearest hundredth) obtained by dividing the Exercise Price in effect prior to adjustment of the Exercise Price by the Exercise Price in effect after adjustment of the Exercise Price. The Company shall notify the holder of Stock Warrants in the same manner as provided in the first paragraph of Section 14, of its election to adjust the number of Stock Warrants, indicating the record date for the adjustment, and, if known at the time, the amount of the adjustment to be made. This record date may be the date on which the Exercise Price is adjusted or any day thereafter, but shall be at least 10 days later than the date of the notice. Upon each adjustment of the number of Stock Warrants pursuant to this subsection (i) the Company shall, as promptly as practicable, cause to be distributed to holders of record of Stock Warrants on such record date Stock Warrant Certificates evidencing, subject to Section 13, the additional Stock Warrants to which such holders shall be entitled as a result of such adjustment, or, at the option of the Company, shall cause to be distributed to such holders of record in substitution and replacement for the Stock Warrant Certificates held by such holders prior to the date of adjustment, and upon surrender thereof, if required by the 10 14 Company, new Stock Warrant Certificates evidencing all the Stock Warrants to be issued, executed and registered in the manner specified in Sections 4 and 5 (and which may bear, at the option of the Company, the adjusted Exercise Price) and shall be registered in the names of the holders of record of Warrant Certificates on the record date specified in the public announcement. (j) In case of any capital reorganization of the Company, or of any reclassification of the Common Stock (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of subdivision or combination), or in case of the consolidation of the Company with or the merger of the Company into any other corporation or in case of a statutory share exchange to which the Company is a party (other than a consolidation, merger or share exchange in which the Company is the continuing or successor corporation) or of the sale of the properties and assets of the Company as, or substantially as, an entirety to any other corporation, each Stock Warrant shall after such reorganization, reclassification, consolidation, merger, share exchange or sale be exercisable upon the terms and conditions specified in this Agreement, for the number of shares of stock or other securities or property to which a holder of the number of Shares purchasable (at the time of such reorganization, reclassification, consolidation, merger, share exchange or sale) upon exercise of such Stock Warrant would have been entitled upon such reorganization, reclassification, consolidation, merger, share exchange or sale; and in any such case, if necessary, the provisions set forth in this Section 11 with respect to the rights and interests thereafter of the holders of the Stock Warrants shall be appropriately adjusted so as to be applicable, as early as may reasonably be, to any shares of stock or other securities or Warrants. The subdivision or combination of shares of Common Stock at any time outstanding into a greater or lesser number of shares shall not be deemed to be a reclassification of the Common Stock for the purposes of this Section 11(j). The Company shall not effect any such consolidation, merger, share exchange or sale, unless prior to or simultaneously with the consummation thereof the successor corporation (if other than the Company) resulting from such consolidation, merger or share exchange or the corporation purchasing such assets or other appropriate corporation or entity shall assume, by written instrument executed and delivered to the Stock Warrant Agent, the obligation to deliver to the holder of each Stock Warrant such shares of stock, securities or assets as, in accordance with the foregoing provisions, such holders may be entitled to purchase under this Agreement. SECTION 12. Optional Reduction of Exercise Price. The Company may, at any time or from time to time, voluntarily reduce the then current Exercise Price by an amount not in excess of 33 11 15 percent of such then current Exercise Price for such period or periods of time as the Board of Directors of the Company may determine; provided, however that each such period shall be at least 30 days. In each such event, the Company shall prepare a certificate of an officer of the Company stating (i) the election of the Company to reduce the then current Exercise Price in accordance with this Section 12; (ii) the period in which such reduced Exercise Price shall be in effect; and (iii) that such election is irrevocable during such period. The Company shall mail a brief summary of the provisions of such certificate at least 15 days prior to the date fixed for the commencement of any period in which the reduced Exercise Price shall be in effect to the Stock Warrant Agent at the address provided in Section 19 hereof and to each registered holder of Stock Warrant Certificates at such Stock Warrant holder's address appearing on the Stock Warrant register. Failure on the part of the holders of Stock Warrant Certificates to receive such notice by mail, or any defect therein, shall not affect the validity of the reduction of the then current Exercise Price during such period. During such period, any adjustment in the Exercise Price pursuant to Section 11 hereof shall be made to the reduced Exercise Price as provided by this Section 12 in the manner specified in such Section 11. After the termination of such period, the Exercise Price shall be such Exercise Price which would have been in effect, as adjusted pursuant to the provisions of Section 11, had there been no reduction in the Exercise Price pursuant to the provisions of this Section 12. No reduction of the then current Exercise Price pursuant to the provisions of this Section 12 shall be deemed for the purposes of Section 11 hereof to alter or adjust the Exercise Price. SECTION 13. Fractional Stock Warrants and Fractional Shares. (a) The Company shall not be required to issue fractions of Stock Warrants on any distribution of Stock Warrants to holders of Stock Warrant Certificates pursuant to Section 11(i) or to distribute Stock Warrant Certificates which evidence fractional Stock Warrants. In lieu of such fractional Stock Warrants, the registered holder of a Stock Warrant Certificate with regard to which such a fractional Stock Warrant would otherwise be issuable shall receive an amount in cash equal to the same fraction of the current market value of a whole Stock Warrant. For purposes of this Section 13(a), the current market value of a Stock Warrant shall be determined under Section 11(d) for the last trading day immediately prior to the date on which such fractional Stock Warrant would have been otherwise issuable. (b) Notwithstanding an adjustment pursuant to Section 11(h) in the number of Shares purchasable upon the exercise of a Stock Warrant, the Company shall not be required to issue fractions of Shares upon exercise of the Stock Warrants or to distribute certificates which evidence fractional Shares. The 12 16 registered holders of Stock Warrant Certificates at the time such Stock Warrants are exercised as herein provided may elect (i) to receive an amount in cash equal to the same fraction of the current market value of a share of Common Stock or (ii) to have the cash payment credited against the Exercise Price of Shares to be received upon exercise of whole Stock Warrants. Such election shall be made on the form provided for such purpose by the Company. For purposes of this Section 13(b), the current market value of a share of Common Stock shall be as determined under Section 11(d) for the last trading day immediately prior to the date of such exercise. SECTION 14. Notices to Stock Warrant Holders. Upon adjustment of the Exercise Price pursuant to Section 11, the Company within 20 calendar days thereafter shall (i) cause to be filed with the Stock Warrant Agent a certificate of a firm of independent public accountants of recognized standing selected by the Company (who may be the regular auditors of the Company) setting forth the Exercise Price after such adjustment and setting forth in reasonable detail the method of calculation and the facts upon which such calculations are based and setting forth the number of Shares purchasable upon exercise of a Stock Warrant after such adjustment in the Exercise Price, which certificate shall be conclusive evidence of the correctness of the matters set forth therein and (ii) cause to be given to each of the registered holders of the Stock Warrant Certificates at such Stock Warrant holder's address appearing on the Stock Warrant register written notice of such adjustments by first-class mail, postage prepaid. Where appropriate, such notice may be given in advance and included as a part of the notice required to be mailed under the other provisions of this Section 14. If: (a) the Company authorizes the issuance to all holders of Common Stock or rights or warrants to subscribe for or purchase capital stock of the Company or of any other subscription rights or warrants; or (b) the Company authorizes the distribution to all holders of Common Stock of evidences of its indebtedness or assets (excluding (i) cash dividends or distributions paid from consolidated earnings or consolidated earned surplus of the Company (determined in accordance with generally accepted accounting principles), or (ii) quarterly Common Stock dividends at the rate of $.05 per share or increases therein out of consolidated net income of the Company (determined in accordance with generally accepted accounting principles) for the period from the end of its most recent fiscal year to the date of the most recent consolidated quarterly financial 13 17 statements of the Company as of the time of the declaration of the dividend, and (iii) dividends payable in Common Stock; or (c) there is any consolidation, share exchange or merger to which the Company is a party and for which approval of any stockholders of the Company is required, or of the conveyance or transfer of the properties and assets of the Company substantially as an entirety, or of any capital reorganization or any reclassification of the Common Stock (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination); or (d) there is a voluntary or involuntary dissolution, liquidation or winding up of the Company; or (e) the Company proposes to take any other action which would require an adjustment of the Exercise Price pursuant to Section 11; the Company shall file with the Stock Warrant Agent and give to each registered holder of a Stock Warrant Certificate at such Stock Warrant holder's address appearing on the Stock Warrant register, at least 20 calendar days (or 10 calendar days in any case specified in clauses (a) or (b) above) prior to the applicable record date hereinafter specified in (i) or (ii) below, by first- class mail, postage prepaid, a written notice stating (i) the date as of which the holders of record of shares of Common Stock to be entitled to receive any such rights, warrants or distribution are to be determined or (ii) the date on which any such consolidation, merger, share exchange, conveyance, transfer, reorganization, reclassification, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of record of shares of Common Stock shall be entitled to exchange such shares for securities or other property, if any, deliverable upon such consolidation, share exchange, merger, conveyance, transfer, reorganization, reclassification, dissolution, liquidation or winding up. Failure to give the notice required by this Section 14 or any defect therein shall not affect the legality or validity of any distribution, right, warrant, consolidation, share exchange, merger, conveyance, transfer, reorganization, reclassification, dissolution, liquidation or winding up or the vote upon any action. Nothing in this Agreement or in any Stock Warrant Certificate shall be construed as conferring upon the holder thereof the right to vote or to consent or to receive notice as a stockholder in respect of the meetings of stockholders or the election of directors of the Company or on any other matter, or any rights whatsoever as a stockholder of the Company. 14 18 SECTION 15. Merger, Consolidation or Change of Name of Stock Warrant Agent. Any corporation into which the Stock Warrant Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Stock Warrant Agent shall be a party, or any corporation succeeding to the corporate trust business of the Stock Warrant Agent, shall be the successor to the Stock Warrant Agent hereunder without the execution or filing of any paper or any further act on the part of any of the parties hereto, provided that such corporation would be eligible for appointment as a successor Stock Warrant Agent under the provisions of Section 18. If at the time such successor to the Stock Warrant Agent shall succeed under this Agreement, any of the Stock Warrant Certificates shall have been countersigned but not delivered, any such successor to the Stock Warrant Agent may adopt the countersignature of the original Stock Warrant Agent; and in case at that time any of the Stock Warrant Certificates shall not have been countersigned, any successor to the Stock Warrant Agent may countersign such Stock Warrant Certificates either in the name of the predecessor Stock Warrant Agent or in the name of the successor Stock Warrant Agent. In all such cases such Stock Warrant Certificates shall have the full force provided in the Stock Warrant Certificates and in this Agreement. If at any time the name of the Stock Warrant Agent shall be changed and at such time any of the Stock Warrant Certificates shall have been countersigned but not delivered, the Stock Warrant Agent whose name has changed may adopt the countersignature under its prior name, and if at that time any of the Stock Warrant Certificates shall not have been countersigned, the Stock Warrant Agent may countersign such Stock Warrant Certificates either in its prior name or in its changed name, and in all such cases such Stock Warrant Certificates shall have the full force provided in the Stock Warrant Certificates and in this Agreement. SECTION 16. Stock Warrant Agent. The Stock Warrant Agent undertakes the duties and obligations imposed by this Agreement upon the following terms and conditions, by all of which the Company and the holders of Stock Warrants, by their acceptance thereof, shall be bound: (a) The statements contained herein and in the Stock Warrant Certificates shall be taken as statements of the Company, and the Stock Warrant Agent assumes no responsibility for the correctness of any of the same except such statements as describe the Stock Warrant Agent or action taken or to be taken by it. Except as herein otherwise provided, the Stock Warrant Agent assumes no responsibility with respect to the execution, delivery or distribution of the Stock Warrant Certificates. 15 19 (b) The Stock Warrant Agent shall not be responsible for any failure of the Company to comply with any of the covenants contained in this Agreement or in the Stock Warrant Certificates to be complied with by the Company, nor shall the Stock Warrant Agent at any time be under any duty or responsibility to any holder of a Stock Warrant to make or cause to be made any adjustment in the Exercise Price (except that the Stock Warrant Agent shall receive the certificate of the Company's independent accountants required to be delivered in connection with any adjustment of the Exercise Price) or in the number of Shares issuable upon exercise of the Stock Warrants (except as instructed by the Company), or to determine whether any facts exist which may require any such adjustments, or with respect to the nature or extent of or method employed in making any such adjustments when made. (c) The Stock Warrant Agent may consult at any time with counsel satisfactory to it (who may be counsel for the Company) and the Stock Warrant Agent shall incur no liability or responsibility to the Company or to any holder of any Stock Warrant Certificate in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with the opinion or the advice of such counsel. (d) The Stock Warrant Agent shall incur no liability or responsibility to the Company or to any holder of any Stock Warrant Certificate for any action taken in reliance on any notice, resolution, waiver, consent, order, certificate, or other paper, document or instrument believed by it to be genuine and to have been signed, sent or presented by the proper party or parties. (e) The Company agrees (i) to pay to the Stock Warrant Agent reasonable compensation for all services rendered by the Stock Warrant Agent under this Agreement; (ii) to reimburse the Stock Warrant Agent upon demand for all expenses, taxes and governmental charges and other charges of any kind and nature incurred by the Stock Warrant Agent in the execution of its duties under this Agreement; and (iii) to indemnify the Stock Warrant Agent and hold it harmless against any and all losses, liabilities and expenses, including judgments, costs and counsel fees, for anything done or omitted by the Stock Warrant Agent arising out of or in connection with this Agreement, except as a result of its negligence or bad faith. (f) The Stock Warrant Agent shall be under no obligation to institute any action, suit or legal proceeding or to take any other action likely to involve expense unless the Company or one or more registered holders of Stock Warrant Certificates shall furnish the Stock Warrant Agent with reasonable security and indemnity for any costs and expenses 16 20 which may be incurred. All rights of action under this Agreement or under any of the Stock Warrants may be enforced by the Stock Warrant Agent without the possession of any of the Stock Warrant Certificates or the production thereof at any trial or other proceeding relative thereto, and any such action, suit or proceeding instituted by the Stock Warrant Agent shall be brought in its name as Stock Warrant Agent, and any recovery or judgment shall be for the ratable benefit of the registered holders of the Stock Warrants, as their respective rights or interests may appear. (g) The Stock Warrant Agent, and any stockholder, director, officer or employee thereof, may buy, sell or deal in any of the Stock Warrants or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or contract with or lend money to the Company or otherwise act as fully and freely as though it were not the Stock Warrant Agent under this Agreement. Nothing herein shall preclude the Stock Warrant Agent from acting in any other capacity for the Company or for any other legal entity. (h) The Stock Warrant Agent shall act hereunder solely as agent for the Company, and its duties shall be determined solely by the provisions hereof. The Stock Warrant Agent shall not be liable for anything which it may do or refrain from doing in connection with this Agreement, except for its own negligence or bad faith. (i) The Company agrees that it will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered all such further and other acts, instruments and assurances as may reasonably be required by the Stock Warrant Agent for the carrying out or performing of the provisions of this Agreement. (j) The Stock Warrant Agent shall not be under any responsibility in respect of the validity of this Agreement or the execution and delivery hereof (except the due execution hereof by the Stock Warrant Agent) or in respect of the validity or execution of any Stock Warrant Certificate (except its countersignature thereof); nor shall the Stock Warrant Agent by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of the Shares to be issued pursuant to this Agreement or any Stock Warrant Certificate or as to whether the Shares will, when issued, be validly issued, fully paid and nonassessable or as to the Exercise Price or the number of Shares issuable upon exercise of any Stock Warrant. 17 21 (k) The Stock Warrant Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder from the Chairman of the Board of Directors, the President, any Executive Vice President, Senior Vice President or Vice President, the Secretary or Assistant Secretary of the Company, and to apply to such officers for advice or instructions in connection with its duties, and shall not be liable for any action taken or suffered to be taken by it in good faith in accordance with instructions of any such officer or in good faith reliance upon any statement signed by any one of such officers of the Company with respect to any fact or matter (unless other evidence in respect thereof is herein specifically prescribed) which may be deemed to be conclusively proved and established by such signed statement. (l) The Company will furnish to the Stock Warrant Agent, upon request but not more often than annually, an opinion of counsel (who may be counsel to the Company) acceptable to the Stock Warrant Agent, to the effect that (i) a Registration Statement under the Securities Act of 1933, as amended, is then in effect with respect to the Shares issuable on the exercise of the Stock Warrants and that the Prospectuses hereinafter referred to comply as to form in all material respects with the requirements of said Act and the rules and regulations of the Securities and Exchange Commission thereunder or (ii) a Registration Statement under said Act with respect to the Shares issuable on the exercise of the Stock Warrants is not required. If said opinion states that such a Registration Statement is in effect, the Company will, from time to time, furnish the Stock Warrant Agent with current Prospectuses meeting the requirements of said Act and all rules and regulations thereunder in sufficient quantity to permit the Stock Warrant Agent to deliver a Prospectus to each holder of a Stock Warrant upon exercise thereof. The Company further agrees to pay all fees, costs and expenses in connection with the preparation and delivery to the Stock Warrant Agent of the foregoing opinions and Prospectuses. SECTION 17. Disposition of Proceeds of Exercise of Stock Warrants. The Stock Warrant Agent shall account promptly to the Company with respect to Stock Warrants exercised and concurrently pay to the Company all moneys received by the Stock Warrant Agent on the purchase of Shares through the exercise of Stock Warrants. SECTION 18. Change of Stock Warrant Agent. If the Stock Warrant Agent shall resign (such resignation to become effective not earlier than 30 days after the giving of written notice thereof to the Company and the registered holders of Stock Warrant Certificates) or shall become incapable of acting as Stock Warrant Agent, the Company shall appoint a successor to the 18 22 Stock Warrant Agent. If the Company shall fail to make such appointment within a period of 90 days after it has been so notified in writing by the Stock Warrant Agent or by the registered holder of a Stock Warrant Certificate (in the case of incapacity), then the registered holder of any Stock Warrant Certificate may apply to any court of competent jurisdiction for the appointment of a successor to the Stock Warrant Agent. Pending appointment of a successor to the Stock Warrant Agent, either by the Company or by such a court, the duties of the Stock Warrant Agent shall be carried out by the Company. Any successor Stock Warrant Agent whether appointed by the Company or by such a court shall be a bank or trust company, in good standing, incorporated under the laws of the United States of America or any state thereof, and having an office in the Borough of Manhattan, The City of New York, State of New York. As soon as practicable after appointment of the successor Stock Warrant Agent, the Company shall cause to be given to each of the registered holders of the Stock Warrant Certificates at such Stock Warrant holder's address appearing on the Stock Warrant register written notice of the change in the Stock Warrant Agent by first-class mail, postage prepaid. After appointment, the successor Stock Warrant Agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Stock Warrant Agent without further act or deed; but the former Stock Warrant Agent shall deliver and transfer to the successor Stock Warrant Agent any property at the time held by it hereunder and execute and deliver, at the expense of the Company, any further assurance, conveyance, act or deed necessary for the purpose. Failure to give any notice provided for in this Section 18, however, or any defect therein, shall not affect the legality or validity of the removal of the Stock Warrant Agent or the appointment of a successor Stock Warrant Agent, as the case may be. SECTION 19. Notices to Company and Stock Warrant Agent. Any notice or demand authorized by this Agreement to be given or made by the Stock Warrant Agent or by the registered holder of any Stock Warrant Certificate to or on the Company shall be sufficiently given or made if sent by mail, first class or registered, postage prepaid, addressed (until another address is filed in writing by the Company with the Stock Warrant Agent), as follows: The Chubb Corporation 15 Mountain View Road P.O. Box 1615 Warren, New Jersey 07061-1615 Attention: Secretary 19 23 If the Company shall fail to maintain such office or agency or shall fail to give such notice of the location or of any change in the location thereof, presentations may be made and notices and demands may be served at the corporate trust office of the Stock Warrant Agent. Any notice pursuant to this Agreement to be given by the Company or by the registered holder of any Stock Warrant Certificate to the Stock Warrant Agent shall be sufficiently given if sent by first-class mail, postage prepaid, addressed (until another address is filed in writing by the Stock Warrant Agent with the Company) to the Stock Warrant Agent as follows: _______________________________ _______________________________ _______________________________ _______________________________ Notwithstanding the foregoing, no notice pursuant to this Agreement shall be effective until received by the Stock Warrant Agent. SECTION 20. Supplements and Amendments. The Company and the Stock Warrant Agent may from time to time supplement or amend this Agreement without the approval of any holders of Stock Warrant Certificates in order to cure any ambiguity, manifest error or other mistake in this Agreement, or to correct or supplement any provision contained herein which may be defective or inconsistent with any other provision herein, or to make any other provisions in regard to matters or questions arising hereunder which the Company and the Stock Warrant Agent may deem necessary or desirable and which shall not adversely affect, alter or change the interest of the holders of Stock Warrant Certificates. SECTION 21. Successors. All the covenants and provisions of this Agreement by or for the benefit of the Company or the Stock Warrant Agent shall bind and inure to the benefit of their respective successors and assigns hereunder. SECTION 22. Termination. This Agreement shall terminate at the close of business on the Expiration Date. Notwithstanding the foregoing, this Agreement will terminate on any earlier date if all Stock Warrants have been exercised. The provisions of Section 16 shall survive such termination. SECTION 23. Governing Law. This Agreement and each Stock Warrant Certificate issued hereunder shall be deemed to be a contract made under the laws of the State of New York and for 20 24 all purposes shall be construed in accordance with the laws of such State. SECTION 24. Benefits of this Agreement. Nothing in this Agreement shall be construed to give to any person or corporation other than the Company, the Stock Warrant Agent and the registered holders of the Stock Warrant Certificates any legal or equitable right, remedy or claim under this Agreement; but this Agreement shall be for the sole and exclusive benefit of the Company, the Stock Warrant Agent and the registered holders of the Stock Warrant Certificates. SECTION 25. Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument. 21 25 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed, as of the day and year first above written. THE CHUBB CORPORATION By: _______________________ Title: [SEAL] Attest: ______________________________ Name: Title: ________________________________ as Stock Warrant Agent By: ___________________________ Title: [SEAL] Attest: ______________________________ Name: Title: 22 26 EXHIBIT A No. W- [FORM OF STOCK WARRANT CERTIFICATE] [FACE] EXERCISABLE ON OR BEFORE ___________________ UNLESS SUCH DATE IS ACCELERATED BY THE COMPANY AS PROVIDED IN THE STOCK WARRANT AGREEMENT REFERRED TO BELOW Certificate for Stock Warrants STOCK WARRANT CERTIFICATE THE CHUBB CORPORATION This Stock Warrant Certificate certifies that ______or registered assigns, is the registered holder of the number of Stock Warrants (the "Stock Warrants") of The Chubb Corporation, a New Jersey corporation (the "Company"), set forth elsewhere on this certificate. Each Stock Warrant expires at the close of business on the Expiration Date (defined below), and entitles the holder to purchase from the Company one fully paid and nonassessable share of Common Stock, $1.00 par value, of the Company (a "Share") at the initial exercise price (the "Exercise Price") of $____ payable in lawful money of the United States of America by means of a certified or official bank check payable to the Company upon surrender of this Stock Warrant Certificate and payment of the Exercise Price at the office or agency of the Stock Warrant Agent in the Borough of Manhattan, The City of New York, State of New York (the "Stock Warrant Agent Office"), but only subject to the conditions set forth herein and in the Stock Warrant Agreement. The Exercise Price and number of Shares purchasable upon exercise of the Stock Warrants are subject to adjustment upon the occurrence of certain events set forth in the Stock Warrant Agreement referred to on the reverse hereof. No Stock Warrant may be exercised after the close of business on (i) _________________ or (ii) such earlier date, on or subsequent to ____________________, as shall be determined by the Company and of which 90 days prior notice shall have been given to the registered holder hereof, if the closing sale price for the Company's Common Stock shall be not less than 125 percent of the then current Stock Warrant exercise price for 20 trading 23 27 days in a period of 30 consecutive trading days ending not more than 10 calendar days immediately prior to the date of such notice (such date of expiration, or such earlier date, is hereafter referred to as the "Expiration Date"). After the close of business on the Expiration Date, the Stock Warrants will become wholly void and of no value. REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS STOCK WARRANT CERTIFICATE SET FORTH ON THE REVERSE HEREOF AND SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS THOUGH FULLY SET FORTH AT THIS PLACE. This Stock Warrant Certificate shall not be valid unless countersigned by the Stock Warrant Agent, as such term is used in the Stock Warrant Agreement. WITNESS the facsimile seal of the Company and the facsimile signatures of its duly authorized officers. THE CHUBB CORPORATION Dated: By: _________________________ Title: Attest:________________________ Title: [SEAL] Countersigned: _______________________________ as Stock Warrant Agent By: __________________________ Authorized Signature 24 28 [FORM OF STOCK WARRANT CERTIFICATE] [REVERSE] THE CHUBB CORPORATION The Stock Warrants evidenced by this Stock Warrant Certificate are part of a duly authorized issue of Stock Warrants expiring at the close of business on the Expiration Date to purchase shares of Common Stock, $1.00 par value per share, of the Company in aggregate up to the number of Stock Warrants evidenced by this Stock Warrant Certificate, and are issued or to be issued pursuant to a Stock Warrant Agreement dated as of ______________ (the "Stock Warrant Agreement"), duly executed and delivered by the Company to ________________, as Stock Warrant Agent (the "Stock Warrant Agent"). The Stock Warrant Agreement is hereby incorporated by reference and made a part of this instrument and is hereby referred to for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Stock Warrant Agent, the Company and the holders (the words "holders" or "holder" meaning the registered holders or registered holder) of the Stock Warrants. Stock Warrants may be exercised to purchase Shares from the Company on or before the close of business on the Expiration Date, at the Exercise Price set forth on the face hereof, subject to adjustment, as hereinafter referred to. The holder of Stock Warrants evidenced by this Stock Warrant Certificate may exercise them by surrendering the Stock Warrant Certificate, with the form of election to purchase set forth hereon properly completed and executed, together with payment of the Exercise Price at the Stock Warrant Agent Office. If upon any exercise of Stock Warrants evidenced hereby the number of Stock Warrants exercised shall be less than the total number of Stock Warrants evidenced hereby, there shall be issued to the holder hereof or such holder's assignee a new Stock Warrant Certificate evidencing the number of Stock Warrants not exercised. No adjustment shall be made for any cash dividends on any Shares issuable upon exercise of this Stock Warrant. After the close of business on the Expiration Date, unexercised Stock Warrants shall become wholly void and of no value. The Stock Warrant Agreement provides that, upon the occurrence of certain events, the Exercise Price set forth on the face hereof may, subject to certain conditions, be adjusted. If the Exercise Price is adjusted, the Stock Warrant Agreement provides that, at the election of the Company, either (i) the number of Shares purchasable upon the exercise of each Stock Warrant shall be adjusted or (ii) each outstanding Stock Warrant 25 29 shall be adjusted to become a different number of Stock Warrants. In the latter event, the Company will cause to be distributed to registered holders of Stock Warrant Certificates either Stock Warrant Certificates representing the additional Stock Warrants issuable pursuant to the adjustment or substitute Stock Warrant Certificates to replace all outstanding Stock Warrant Certificates. At any time or from time to time, the Company shall have the right to reduce the then current Exercise Price by an amount not in excess of 33 percent for a period or periods to be determined by the Company, but in any event not less than 30 days. The Company shall make a public announcement of the reduction in Exercise Price and shall mail a notice to each registered holder of Stock Warrant Certificates. The Company shall not be required to issue fractional Stock Warrants or fractional Shares upon the exercise of Stock Warrants or any certificates which evidence fractional Stock Warrants or fractional Shares. In lieu of such fractional Stock Warrants, the registered holder of a Stock Warrant Certificate with regard to which a fractional Stock Warrant would otherwise be issuable shall receive an amount in cash equal to the same fraction of the current market value of a whole Stock Warrant (as determined pursuant to the Stock Warrant Agreement). In lieu of such fractional Shares the registered holders of the Stock Warrant Certificates with regard to which such fractional Shares would otherwise be issuable may elect, at the time of the exercise of Stock Warrants, (i) to receive an amount in cash equal to the same fraction of the current market value (as determined pursuant to the Stock Warrant Agreement) of a full Share or (ii) to credit such cash payment against the Exercise Price of Shares to be received upon exercise of whole Stock Warrants. One or more Stock Warrant Certificates, when surrendered at the Stock Warrant Agent Office by the registered holder thereof in person or by legal representative or by attorney duly authorized in writing, may be exchanged, in the manner and subject to the limitations provided in the Stock Warrant Agreement, but without payment of any service charge, for another Stock Warrant Certificate or Stock Warrant Certificates of like tenor evidencing in the aggregate a like number of Stock Warrants. Upon due presentment for registration of transfer of this Stock Warrant Certificate at the Stock Warrant Agent Office, a new Stock Warrant Certificate or Stock Warrant Certificates of like tenor and evidencing in the aggregate a like number of Stock Warrants shall be issued to the transferee in exchange for this Stock Warrant Certificate, subject to the limitations provided in 26 30 the Stock Warrant Agreement, without charge except for any tax or other governmental charge imposed in connection therewith. The Company and the Stock Warrant Agent may deem and treat the registered holder hereof as the absolute owner of this Stock Warrant Certificate (notwithstanding any notation of ownership or other writing hereon made by anyone) for the purpose of any exercise or exchange hereof and for all other purposes, and neither the Company nor the Stock Warrant Agent shall be affected by any notice to the contrary. 27 31 [FORM OF ELECTION TO EXERCISE] (To be executed upon exercise of Stock Warrant prior to the close of business on the Expiration Date) The undersigned hereby irrevocably elects to exercise the right, represented by this Stock Warrant Certificate, to purchase ______ Shares and herewith tenders payment for such Shares in the amount of $ _________ in the form of a certified or official bank check payable to the Company. The undersigned requests that a certificate representing the Shares be registered in the name of _____________________________ whose address is ___________________and that such certificate be delivered to _____________ ___________ whose address is _______________________. If said number of Shares is less than all the Shares purchasable hereunder, the undersigned requests that a new Stock Warrant Certificate representing the right to purchase the balance of the Shares be registered in the name of ________________ whose address is ___________________ and that such Stock Warrant Certificate be delivered to _______________ whose address is _______________. In lieu of receipt of a fractional Share, if any, the undersigned hereby elects (i) to receive a cash payment made to ___________________ whose address is ___________________ and the check representing payment thereof should be delivered to ___________________ whose address is _______________ or (ii) elects to credit the amount of such payment against the Exercise Price payable for Shares to be received upon the exercise of Stock Warrants. Dated:_________________________, 19__ _____________________________________ Social Security or other Taxpayer's Identification Number 28 32 Name of registered holder of Stock Warrant Certificate:____________________________________________ (Please print) Address: ________________________________________________ ________________________________________________ Signature: ________________________________________________ Note: The above signature must correspond with the name as written upon the face of this Stock Warrant Certificate in every particular, without alteration or enlargement or any change whatever and if the certificate representing the Shares or any Stock Warrant Certificate representing Stock Warrants not exercised is to be registered in a name other than that in which this Stock Warrant Certificate is registered, the signature of the holder hereof must be guaranteed. Signature Guaranteed: 29 33 [FORM OF ASSIGNMENT] For value received hereby sells, assigns and transfers unto the within Stock Warrant Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint attorney, to transfer said Stock Warrant Certificate on the books of the within-named Company, with full power of substitution in the premises. Dated: ________________________, 19__. ______________________________________________ Note: The above signature must correspond with the name as written upon the face of this Stock Warrant Certificate in every particular, without alteration or enlargement or any change whatever. Signature Guaranteed: 30 EX-4.13 10 CHUBB DEBT WARRANT AGREEMENT 1 Exhibit 4.13 THE CHUBB CORPORATION and _________________ as Warrant Agent __________________________ DEBT WARRANT AGREEMENT Dated as of ________________ ____________________________ Warrants to Purchase ________ ____________________ 2 TABLE OF CONTENTS*
PAGE ---- PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 ARTICLE I ISSUANCE OF WARRANTS [AND TEMPORARY GLOBAL SECURITY] AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES SECTION 1.01. Issuance of Warrants . . . . . . . . . . . . . . . . . . 2 SECTION 1.02. Execution and Delivery of Warrant Certificates . . . . . . . . . . . . . . 2 SECTION 1.03. Issuance of Warrant Certificates . . . . . . . . . . . . 4 [SECTION 1.04. Temporary Global Security . . . . . . . . . . . . . . . 5] ARTICLE II WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS SECTION 2.01. Warrant Price . . . . . . . . . . . . . . . . . . . . . . 5 SECTION 2.02. Duration of Warrants . . . . . . . . . . . . . . . . . . . 6 SECTION 2.03. Exercise of Warrants . . . . . . . . . . . . . . . . . . . 6
- ---------------- * The Table of Contents is not a part of the Agreement. i 3 ARTICLE III OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES SECTION 3.01. No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates . . . . . . . . . . . . . . . . . . . . 10 SECTION 3.02. Lost, Mutilated, Stolen or Destroyed Warrant Certificates . . . . . . . . . . . 11 SECTION 3.03. Enforcement of Rights . . . . . . . . . . . . . . . . . 11 SECTION 3.04. Merger, Consolidation, Conveyance or Transfer . . . . . . . . . . . . . . . . . . . . 11 ARTICLE IV EXCHANGE AND TRANSFER SECTION 4.01. Exchange and Transfer . . . . . . . . . . . . . . . . . 12 SECTION 4.02. Treatment of Holders of Warrant Certificates . . . . . . . . . . . . . . . . 13 SECTION 4.03. Cancellation of Warrant Certificates . . . . . . . . . . . . . . . . . . . . 14 ARTICLE V CONCERNING THE WARRANT AGENT SECTION 5.01. Warrant Agent . . . . . . . . . . . . . . . . . . . . . 15 SECTION 5.02. Conditions of Warrant Agent's Obligations . . . . . . . . . . . . . . . . . . . . 15 SECTION 5.03. Resignation and Appointment of Successor . . . . . . . . . . . . . . . . . . . . 17
-ii- 4 ARTICLE VI MISCELLANEOUS SECTION 6.01. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . 19 SECTION 6.02. Notices and Demands to the Company and Warrant Agent . . . . . . . . . . . . . . . . . . . 19 SECTION 6.03. Addresses . . . . . . . . . . . . . . . . . . . . . . . . . 19 SECTION 6.04. Applicable Law . . . . . . . . . . . . . . . . . . . . . . . 19 SECTION 6.05. Delivery of Prospectus . . . . . . . . . . . . . . . . . . . 19 SECTION 6.06. Obtaining of Governmental Approval . . . . . . . . . . . . . . . . . . . . . . . . 20 SECTION 6.07. Persons Having Rights Under Warrant Agreement . . . . . . . . . . . . . . . . . . . 20 SECTION 6.08. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . 20 SECTION 6.09. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . 20 SECTION 6.10. Inspection of Agreement . . . . . . . . . . . . . . . . . . 20 SECTION 6.11. Notices to Holders of Warrants . . . . . . . . . . . . . . . 20 TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 EXHIBIT A - Form of Warrant Certificate [in Registered Form] [EXHIBIT B - Form of Global Warrant Certificate in Bearer Form] [EXHIBIT C - Form of Certificate to be Delivered to the Warrant Agent by the Euro-clear Operator or CEDEL] [EXHIBIT D - Form of Warrant Exercise Notice] [EXHIBIT E - Form of Confirmation to be Delivered to Purchasers of Warrant Securities in Bearer Form]
-iii- 5 DEBT WARRANT AGREEMENT* THIS AGREEMENT dated as of between THE CHUBB CORPORATION, a corporation duly organized and existing under the laws of the State of New Jersey (the "Company"), and, __________________ a [bank] [trust company] duly incorporated and existing under the laws of , as Warrant Agent (the "Warrant Agent"). W I T N E S S E T H : WHEREAS, the Company has entered into an Indenture dated as of _____________, 19__ (the "Indenture") between the Company and The First National Bank of Chicago, as Trustee (the "Trustee"), providing for the issuance from time to time of its debt securities to be issued in one or more series as provided in the Indenture; and WHEREAS, the Company proposes to sell [Title of such debt securities being offered] (the "Offered Securities") with one or more warrants (the "Warrants") representing the right to purchase [title of such debt securities purchasable through exercise of Warrants] (the "Warrant Securities"), the Warrants to be evidenced by Warrant certificates issued pursuant to this Agreement (the "Warrant Certificates"); and WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company in connection with the issuance, transfer, exchange, exercise and replacement of the Warrant Certificates, and in this Agreement wishes to - -------------- * Complete or modify the provisions as appropriate to reflect the terms of the Warrants and Warrant Securities. Monetary amounts may be in U.S. dollars, in a foreign currency or in a composite currency, including but not limited to the European Currency Unit. Bracketed language here and throughout this Agreement should be inserted as follows: 1. If Warrants are immediately detachable from the Offered Securities; and 2. If Warrants are detachable from the Offered Securities only after the Detachable Date. -1- 6 set forth, among other things, the form[s] and provisions of the Warrant Certificates and the terms and conditions on which they may be issued, transferred, exchanged, exercised and replaced; NOW, THEREFORE, in consideration of the premises and of the mutual agreements herein contained, the parties hereto agree as follows: ARTICLE I ISSUANCE OF WARRANTS [AND TEMPORARY GLOBAL SECURITY] AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES SECTION 1.01. Issuance of Warrants. The Warrants shall be evidenced by one or more Warrant Certificates. Each Warrant evidenced thereby shall represent the right, subject to the provisions contained herein and therein, to purchase a Warrant Security in the principal amount of and shall be initially issued in connection with the issuance of the Offered Securities [1: and shall be separately transferable immediately thereafter] [2: but shall not be separately transferable until on and after , 19 (the "Detachable Date")]. The Warrants shall be initially issued [in units] with the Offered Securities, and each Warrant [included in such a unit] shall evidence the right, subject to the provisions contained herein and in the Warrant Certificates, to purchase [ ] principal amount of Warrant Securities [included in such a unit]. SECTION 1.02. Execution and Delivery of Warrant Certificates. Each Warrant, whenever issued, shall be evidenced by a Warrant Certificate in registered form [or a global Warrant Certificate in bearer form (the "Global Warrant Certificate")] [the form to be the same as that of the Warrant Security in connection with which the Warrant Certificate is issued], substantially in the form[s] set forth in Exhibit A [and Exhibit B, respectively,] hereto, shall be dated and may have such letters, numbers or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as the officers of the Company executing the same may approve (execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Agreement, or as may be required to comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any stock -2- 7 exchange on which the Warrants may be listed, or to conform to usage. The Warrant Certificates shall be signed on behalf of the Company by its chairman of the Board of Directors, the President, any Executive Vice President, Senior Vice President or Vice President or the Treasurer of the Company, in each case under its corporate seal, which may but need not be, attested by its Secretary or one of its Assistant Secretaries [, except that the Global Warrant Certificate may be executed by any such officer without any necessity that such signature be under seal as aforesaid]. Such signatures may be manual or facsimile signatures of such authorized officers and may be imprinted or otherwise reproduced on the Warrant Certificates. The corporate seal of the Company may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant Certificates. No Warrant Certificate shall be valid for any purpose, and no Warrant evidenced thereby shall be exercisable, until such Warrant Certificate has been countersigned by the Warrant Agent by manual signature. Such signature by the Warrant Agent upon any Warrant Certificate executed by the Company shall be conclusive evidence, and the only evidence, that the Warrant Certificate so countersigned has been duly issued hereunder. [The Global Warrant Certificate shall be and remain subject to the provisions of this Agreement until such time as all of the Warrants evidenced thereby shall have been duly exercised or shall have expired or been canceled in accordance with the terms thereof.] In case any officer of the Company who shall have signed any of the Warrant Certificates either manually or by facsimile signature shall cease to be such officer before the Warrant Certificates so signed shall have been countersigned and delivered by the Warrant Agent as provided herein, such Warrant Certificates may be countersigned and delivered notwithstanding that the person who signed such Warrant Certificates ceased to be such officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by such persons as, at the actual date of the execution of such Warrant Certificate, shall be the proper officers of the Company, although at the date of the execution of this Agreement any such person was not such officer. The term "Holder", when used with respect to any Warrant Certificate [in registered form], shall mean any person in whose name at the time such Warrant Certificate -3- 8 shall be registered upon the books to be maintained by the Warrant Agent for that purpose [2: or, prior to the Detachable Date, any person in whose name at the time the Offered Security to which such Warrant Certificate is attached is registered upon the register of the Offered Securities. Prior to the Detachable Date, the Company will, or will cause the registrar of the Offered Securities to, make available at all times to the Warrant Agent such information as to holders of the Offered Securities with Warrants as may be necessary to keep the Warrant Agent's records up to date.] [The term "Holder", when used with respect to the Global Warrant Certificate, shall mean [2:, prior to the Detachable Date, the bearer of the Temporary Global Security (as defined in Section 1.04) evidencing the Offered Securities to which the Warrants evidenced by the Global Warrant Certificate were initially attached and, after the Detachable Date,] the bearer of the Global Warrant Certificate.] SECTION 1.03. Issuance of Warrant Certificates. Warrant Certificates evidencing the right to purchase an aggregate principal amount not exceeding aggregate principal amount of Warrant Securities (except as provided in Sections 2.03, 3.02 and 4.01) may be executed by the Company and delivered to the Warrant Agent upon the execution of this Warrant Agreement or from time to time thereafter. The Warrant Agent shall, upon receipt of Warrant Certificates duly executed on behalf of the Company, countersign Warrant Certificates evidencing Warrants representing the right to purchase up to aggregate principal amount of Warrant Securities and shall [, in the case of Warrant Certificates in registered form,] deliver such Warrant Certificates to or upon the order of the Company [and, in the case of the Global Warrant Certificate, upon the order of the Company, deposit the Global Warrant Certificate with , as common depositary (the "Common Depositary") for Morgan Guaranty Trust Company of New York, Brussels office as operator of the Euro-clear System (the "Euro-clear Operator"), and for Centrale de Livraison de Valeurs Mobilieres S.A. ("CEDEL") for credit to the accounts of persons appearing from time to time on the records of the Euro-clear Operator or of CEDEL as being entitled to any portion thereof. [2: The Temporary Global Security [, as defined in Section 1.04,] will at the same time be deposited with the Common Depositary.] [The Global Warrant Certificate shall be held by the Common Depositary outside the United Kingdom.]] Subsequent to such original issuance of the Warrant Certificates, the Warrant Agent shall countersign a Warrant Certificate only if the Warrant -4- 9 Certificate is issued in exchange or substitution for one or more previously countersigned Warrant Certificates or [, with respect to Warrant Certificates in registered form,] in connection with their transfer as hereinafter provided or as provided in the antepenultimate paragraph of Section 2.03]. Pending the preparation of definitive Warrant Certificates [in registered form] evidencing Warrants, the Company may execute and the Warrant Agent shall countersign and deliver temporary Warrant Certificates [in registered form] evidencing such Warrants (printed, lithographed, typewritten or otherwise produced, in each case in form satisfactory to the Warrant Agent). Such temporary Warrant Certificates shall be issuable substantially in the form of the definitive Warrant Certificates [in registered form] but with such omissions, insertions and variations as may be appropriate for temporary Warrant Certificates, all as may be determined by the Company with the concurrence of the Warrant Agent. Such temporary Warrant Certificates may contain such reference to any provisions of this Warrant Agreement as may be appropriate. Every such temporary Warrant Certificate shall be executed by the Company and shall be countersigned by the Warrant Agent upon the same conditions and in substantially the same manner, and with like effect, as the definitive Warrant Certificates [in registered form]. Without unreasonable delay, the Company shall execute and shall furnish definitive Warrant Certificates [in registered form] and thereupon such temporary Warrant Certificates may be surrendered in exchange therefor without charge pursuant to and subject to the provisions of Section 4.01, and the Warrant Agent shall countersign and deliver in exchange for such temporary Warrant Certificates definitive Warrant Certificates [in registered form] of authorized denominations evidencing a like aggregate number of Warrants evidenced by such temporary Warrant Certificates. Until so exchanged, such temporary Warrant Certificates shall be entitled to the same benefits under this Warrant Agreement as definitive Warrant Certificates [in registered form]. [2: SECTION 1.04. Temporary Global Security. Prior to the Detachable Date, each Offered Security to be issued with Warrants evidenced by the Global Warrant Certificate shall, whenever issued, be evidenced by a single temporary global Offered Security in bearer form without interest coupons (the "Temporary Global Security") to be issued by the Company as provided in the Indenture.] -5- 10 ARTICLE II WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS SECTION 2.01. Warrant Price. On ________________, 19__ the exercise price of each Warrant will be . During the period from , 19 through and including , 19 , the exercise price of each Warrant will be plus [accrued amortization of the original issue discount] [accrued interest] from , 19 . On , 19 the exercise price of each Warrant will be . During the period from , 19 through and including , 19 , the exercise price of each Warrant will be plus [accrued amortization of the original issue discount] [accrued interest] from , 19 . [In each case, the original issue discount will be amortized at a % annual rate, computed on an annual basis using the "interest" method and using a 360-day year consisting of twelve 30-day months]. Such exercise price of Warrant Securities is referred to in this Agreement as the "Warrant Price". [The original issue discount for each principal amount of Warrant Securities is ]. SECTION 2.02. Duration of Warrants. Subject to Section 4.03(b), each Warrant may be exercised [in whole but not in part] [in whole or in part] [at any time, as specified herein, on or after [the date thereof] [ , 19 ] and at or before [time, location] on , 19 (each day during such period may hereinafter be referred to as an "Exercise Date")] [on [list of specific dates] (each, an "Exercise Date")], or such later date as the Company may designate by notice to the Warrant Agent and the Holders of Warrant Certificates [in registered form and to the beneficial owners of the Global Warrant Certificate] (the "Expiration Date"). Each Warrant not exercised at or before [time, location] on the Expiration Date shall become void, and all rights of the Holder [and any beneficial owners] of the Warrant Certificate evidencing such Warrant under this Agreement shall cease. SECTION 2.03. Exercise of Warrants. [During] [With respect to Warrants evidenced by Warrant Certificates in registered form, during] the period specified in Section 2.02, any whole number of Warrants may be exercised by providing certain information as set forth on the reverse side of the Warrant Certificates evidencing such Warrants and by paying in full [in lawful money of the United States -6- 11 of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds,] the Warrant Price for each Warrant exercised (plus accrued interest, if any, on the Warrant Securities to be issued upon exercise of such Warrant from and including the Interest Payment Date (as defined in the Indenture), if any, in respect of such Warrant Securities immediately preceding the Exercise Date to and including the Exercise Date (unless the Exercise Date is after the Regular Record Date (as defined in the Indenture), if any, for such Interest Payment Date, but on or before the immediately succeeding Interest Payment Date for such Warrant Securities, in which event no such accrued interest shall be payable in respect of Warrant Securities to be issued in registered form)) to the Warrant Agent at its corporate trust office at [address] [or at ], provided that such exercise is subject to receipt within five business days of such [payment] [wire transfer] by the Warrant Agent of the Warrant Certificate evidencing each Warrant exercised with the form of election to purchase Warrant Securities set forth on the reverse side of the Warrant Certificate properly completed and duly executed. [With respect to Warrants evidenced by the Global Warrant Certificate, during the period specified in Section 2.02, any whole number of Warrants may be exercised by the Holder by presentation to the Warrant Agent at its office at [address located outside the United States [and the United Kingdom]], at or prior to [time], on any day on which the Warrants are exercisable, of (i) the Global Warrant Certificate [2: together with, if prior to the Detachable Date, the Temporary Global Security] (or written confirmation reasonably satisfactory to the Warrant Agent that the Global Warrant Certificate [1: is] [2: and, if prior to the Detachable Date, the Temporary Global Security are] held by the Euro-clear Operator and CEDEL and will be duly endorsed to reflect the exercise of Warrants [2: and, if prior to the Detachable Date, the surrender to the Warrant Agent of the Offered Securities to which the Warrants are attached] by the Euro-clear Operator and CEDEL), (ii) a duly executed certification from the Euro-clear Operator or CEDEL, as the case may be, substantially in the form set forth in Exhibit C hereto and (iii) payment in full [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds,] of the Warrant Price for each Warrant exercised (plus accrued interest, if any, on the Warrant Securities to be issued upon exercise of such Warrant from -7- 12 and including the Interest Payment Date, if any, in respect of such Warrant Securities immediately preceding the Exercise Date to and including the Exercise Date (unless the Exercise Date is after the Regular Record Date, if any, for such Interest Payment Date, but on or before the immediately succeeding Interest Payment Date for such Warrant Securities, in which event no such accrued interest shall be payable in respect of Warrant Securities to be issued in registered form)). Notwithstanding the foregoing, the Holder may exercise Warrants as aforesaid on the Expiration Date at any time prior to [time] in [city of Warrant Agent's office]. Any Warrants exercised as set forth in this paragraph shall be deemed exercised at the [country] office of the Warrant Agent.] [The Warrant Agent shall retain each certificate received by it from the Euro-clear Operator or CEDEL through the Expiration Date (or such earlier date by which all of the Warrants may have been exercised or canceled) and thereafter shall dispose of them or deliver them to the Company pursuant to the instructions of the Company.] [The delivery to the Warrant Agent by the Euro-clear Operator or CEDEL of any certification referred to above may be relied upon by the Company, the Warrant Agent and the Trustee as conclusive evidence that a corresponding certificate or certificates substantially in the form of Exhibit D hereto has or have been delivered to the Euro-clear Operator or CEDEL, as the case may be.] [The Company will maintain in [location] (or in such other city [in western Europe] as the Company may deem advisable), until the right to exercise the Warrants shall expire or be earlier canceled as hereinafter provided, an agency where the Global Warrant Certificate [2: and, if prior to the Detachable Date, the Temporary Global Security] may be presented for exercise of the Warrants represented thereby [2: and, if prior to the Detachable Date, for surrender for cancellation of the Offered Securities to which such Warrants are attached] and notices and demands to or upon the Company in respect of the Warrants or of this Agreement may be made.] The date on which payment in full of the Warrant Price (plus any such accrued interest) is received by the Warrant Agent shall, subject to receipt of the Warrant Certificate [in registered form or, as the case may be, the Global Warrant Certificate [2: and, if required, the Temporary Global Security] and the certification of Euro-clear Operator or CEDEL] as aforesaid, be deemed to be the date on which the Warrant is exercised. The Warrant -8- 13 Agent shall deposit all funds received by it in payment for the exercise of Warrants in an account of the Company maintained with it (or in such other account as may be designated by the Company) and shall advise the Company, by telephone or by facsimile transmission or other form of electronic communication available to both parties, at the end of each day on which a payment for the exercise of Warrants is received of the amount so deposited to its account. The Warrant Agent shall promptly confirm such advice to the Company in writing. If a day on which Warrants may be exercised in the city in which such Warrants are to be exercised shall be a Saturday or Sunday or a day on which banking institutions in such city are authorized or required to be closed, then, notwithstanding any other provision of this Agreement or the Warrant Certificate evidencing such Warrants, but subject to the limitation that no Warrant may be exercised after the Expiration Date, the Warrants shall be exercisable on the next succeeding day which in such city is not a Saturday or Sunday or a day on which banking institutions in such city are authorized or required to be closed. The Warrant Agent shall, from time to time, as promptly as practicable, advise the Company [and][,] the Trustee [and the Common Depositary at [both] its London and [location] office[s]] in writing [(which, in the case of exercised Warrants represented by the Global Warrant Certificate, shall be tested telex with appropriate answerback received,)] of (i) the number of Warrants exercised, (ii) the instructions of each Holder of the Warrant Certificates [in registered form] evidencing such Warrants [or of the Euro-clear Operator or CEDEL, as the case may be,] with respect to delivery of the Warrant Securities to be issued upon such exercise, (iii) delivery of any Warrant Certificates [in registered form] evidencing the balance, if any, of the Warrants remaining after such exercise, and (iv) such other information as the Company or the Trustee shall reasonably require. [In addition, in the case of exercised Warrants evidenced by the Global Warrant Certificate, the Warrant Agent shall, as promptly as practicable, endorse, or cause the Common Depositary, [location] office, or one of the Warrant Agent's agents to endorse, Schedule A annexed to the Global Warrant Certificate to reflect the exercise of such Warrants [2: and the Temporary Global Security to reflect the surrender for cancellation of the Offered Securities to which such Warrants are attached] and, if applicable, return the Global Warrant Certificate [2: and the Temporary Global Security] to the Common Depositary or to its order.] -9- 14 As soon as practicable after the exercise of any Warrant [evidenced by a Warrant Certificate in registered form], but subject to receipt by the Warrant Agent of the Warrant Certificate evidencing such Warrant as provided in this Section, the Company shall issue, pursuant to the Indenture, in authorized denominations to or upon the order of the Holder of the Warrant Certificate evidencing each Warrant, the Warrant Securities to which such Holder is entitled, in fully registered form, registered in such name or names as may be directed by such Holder. If fewer than all of the Warrants evidenced by such Warrant Certificate are exercised, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, a new Warrant Certificate [in registered form] evidencing the number of such Warrants remaining unexercised. [As soon as practicable after the exercise of any Warrant evidenced by the Global Warrant Certificate, the Company shall issue, pursuant to the Indenture, the Warrant Securities issuable upon such exercise, in authorized denominations (i) in fully registered form, registered in such name or names as may be directed by the Euro-clear Operator or CEDEL, as the case may be, to or upon order of the Euro-clear Operator or CEDEL, as the case may be, or (ii) in bearer form to the Common Depositary to be held for the account of the Euro-clear Operator or CEDEL, as the case may be, together with a written confirmation substantially in form of Exhibit E hereto; provided, however, that no Warrant Security in bearer form shall be mailed or otherwise delivered to any location in the United States of America, its territories or possessions or areas subject to its jurisdiction or the Commonwealth of Puerto Rico.] The Company shall not be required to pay any stamp or other tax or other governmental charge required to be paid in connection with any transfer involved in the issuance of the Warrant Securities, and in the event that any such transfer is involved, the Company shall not be required to issue or deliver any Warrant Security until such tax or other charge shall have been paid or it has been established to the Company's satisfaction that no such tax or other charge is due. -10- 15 ARTICLE III OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES SECTION 3.01. No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates. No Warrant Certificate or Warrant evidenced thereby shall entitle the Holder or any beneficial owner thereof to any of the rights of a holder or beneficial owner of Warrant Securities, including, without limitation, the right to receive the payment of principal of (premium, if any) or interest, if any, on Warrant Securities or to enforce any of the covenants in the Indenture. SECTION 3.02. Lost, Mutilated, Stolen, or Destroyed Warrant Certificates. Upon receipt by the Warrant Agent of evidence reasonably satisfactory to it and the Company of the ownership of and the loss, mutilation, theft or destruction of any Warrant Certificate and of such security or indemnity as may be required by the Company and the Warrant Agent to hold each of them and any agent of them harmless and, in the case of mutilation of a Warrant Certificate, upon surrender thereof to the Warrant Agent for cancellation, then, in the absence of notice to the Company or the Warrant Agent that such Warrant Certificate has been acquired by a bona fide purchaser, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, in exchange for or in lieu of the lost, mutilated, stolen or destroyed Warrant Certificate, a new Warrant Certificate of the same tenor and evidencing a like number of Warrants[; provided, however, that any Global Warrant Certificate shall be so delivered only to the Common Depositary.] Upon the issuance of any new Warrant Certificate under this Section, the Company may require the payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Warrant Agent) in connection therewith. Every substitute Warrant Certificate executed and delivered pursuant to this Section in lieu of any lost, mutilated, stolen or destroyed Warrant Certificate shall represent an additional contractual obligation of the Company, whether or not the lost, stolen or destroyed Warrant Certificate shall be at any time enforceable by anyone, and shall be entitled to the benefits of this Agreement equally and proportionately with any and all other Warrant Certificates duly executed and delivered hereunder. The provisions of this Section are exclusive and shall -11- 16 preclude (to the extent lawful) all other rights and remedies with respect to the replacement of lost, mutilated, stolen or destroyed Warrant Certificates. SECTION 3.03. Enforcement of Rights. Notwithstanding any of the provisions of this Agreement, any Holder of a Warrant Certificate [in registered form or the beneficial owner of any Warrant evidenced by the Global Warrant Certificate], without the consent of [the Common Depositary,] the Warrant Agent, the Trustee, the holder of any Offered Securities or the Holder of any other Warrant Certificate, may, in its own behalf and for its own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company suitable to enforce, or otherwise in respect of, its right to exercise its Warrants in the manner provided in its Warrant Certificate [or the Global Warrant Certificate, as the case may be,] and in this Agreement. [Neither the Company nor the Warrant Agent shall be required to treat any person as a beneficial owner of any Warrant evidenced by the Global Warrant Certificate unless such person is so certified as such a beneficial owner by the Euro-clear Operator or CEDEL.] SECTION 3.04. Merger, Consolidation, Share Exchange, Conveyance or Transfer. (a) If at any time there shall be a merger or consolidation of the Company or a statutory share exchange to which the Company is a party or a conveyance or transfer of its property and assets substantially as an entirety as permitted under the Indenture, then in any such event the successor or assuming corporation referred to therein shall succeed to and be substituted for the Company, with the same effect, subject to the Indenture, as if it had been named herein and in the Warrant Certificates as the Company; the Company shall thereupon, except in the case of a transfer by way of lease, be relieved of any further obligation hereunder and under the Warrants and the Warrant Certificates, and the Company as the predecessor corporation, except in the case of a transfer by way of lease, may thereupon or at any time thereafter be dissolved, wound up or liquidated. Such successor or assuming corporation may thereupon cause to be signed, and may issue either in its own name or in the name of the Company, Warrant Certificates evidencing any or all of the Warrants issuable hereunder which theretofore shall not have been signed by the Company, and may execute and deliver Warrant Securities in its own name pursuant to the Indenture, in fulfillment of its obligations to deliver Warrant Securities upon exercise of the Warrants. All the Warrants so issued shall in all respects have the same legal rank and benefit under this Agreement as the Warrants theretofore or thereafter issued in accordance with the -12- 17 terms of this Agreement as though all of such Warrants had been issued at the date of the execution hereof. In any case of any such merger, consolidation, share exchange, conveyance or transfer, such changes in phraseology and form (but not in substance) may be made in the Warrant Certificates representing the Warrants thereafter to be issued as may be appropriate. (b) The Warrant Agent may receive a written opinion of legal counsel (who shall be acceptable to the Warrant Agent) as conclusive evidence that any such merger, consolidation, share exchange, conveyance or transfer complies with the provisions of this Section and the Indenture. ARTICLE IV EXCHANGE AND TRANSFER SECTION 4.01. Exchange and Transfer. (a) [1: Upon] [2: Prior to] the Detachable Date, a Warrant Certificate [in registered form] may be exchanged or transferred only together with the Offered Security to which such Warrant Certificate was initially attached, and only for the purpose of effecting, or in conjunction with, an exchange or transfer of such Offered Security. Prior to the Detachable Date, the transfer of the beneficial ownership of any Warrant evidenced by the Global Warrant Certificate shall effect and shall be deemed to effect the transfer of the beneficial ownership of any Offered Securities evidenced by the Temporary Global Security that are attached to such Warrants. Prior to any Detachable Date, each transfer of the Offered Security [on the register maintained with respect to the Offered Securities, in the case of an Offered Security that is in registered form], shall operate also to transfer the related Warrant Certificates. Similarly, prior to the Detachable Date, the transfer of the beneficial ownership of any Offered Security evidenced by the Temporary Global Security shall be deemed to be the transfer of the beneficial ownership of any Warrants evidenced by the Global Warrant Certificate that are attached to such Offered Securities. The transfer of the beneficial ownership of Warrants and Warrant Securities hereunder shall be effected only as provided in Section 4.01. On or after the Detachable Date, upon] surrender at the corporate trust office of the Warrant Agent at [address] [or ], Warrant Certificates [in registered form] evidencing Warrants may be exchanged for Warrant Certificates [in registered form] in -13- 18 other authorized denominations evidencing such Warrants or the transfer thereof may be registered in whole or in part; provided, however, that such other Warrant Certificates shall evidence the same aggregate number of Warrants as the Warrant Certificates so surrendered. (b) The Warrant Agent shall keep, at its corporate trust office at [address] [and at ], books in which, subject to such reasonable regulations as it may prescribe, it shall register Warrant Certificates [in registered form] and exchanges and transfers of outstanding Warrant Certificates [in registered form] upon surrender of such Warrant Certificates to the Warrant Agent at its corporate trust office at [address] or [ ] for exchange or registration of transfer, properly endorsed [or accompanied by appropriate instruments of registration of transfer and written instructions for transfer, all in form satisfactory to the Company and the Warrant Agent.] (c) No service charge shall be made for any exchange or registration of transfer of Warrant Certificates [in registered form], but the Company may require payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in connection with any such exchange or registration of transfer. (d) Whenever any Warrant Certificates [in registered form], are so surrendered for exchange or registration of transfer, an authorized officer of the Warrant Agent shall manually countersign and deliver to the person or persons entitled thereto a Warrant Certificate or Warrant Certificates [in registered form], duly authorized and executed by the Company, as so requested. The Warrant Agent shall not effect any exchange or registration of transfer which will result in the issuance of a Warrant Certificate [in registered form], evidencing a fraction of a Warrant or a number of full Warrants and a fraction of a Warrant. (e) All Warrant Certificates [in registered form], issued upon any exchange or registration of transfer of Warrant Certificates shall be the valid obligations of the Company, evidencing the same obligations, and entitled to the same benefits under this Agreement, as the Warrant Certificates surrendered for such exchange or registration or transfer. SECTION 4.02. Treatment of Holders of Warrant Certificates. [With respect to the Global Warrant Certificate, the Holder thereof may be treated by the Company, the Warrant Agent and all other persons dealing -14- 19 with such Holder as the absolute owner thereof for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding.] [Each] [With respect to Warrant Certificates in registered form, each] Holder of a Warrant Certificate, by accepting the same, consents and agrees with the Company, the Warrant Agent and every subsequent Holder of such Warrant Certificate that until the transfer of such Warrant Certificate is registered on the books of such Warrant Agent [2: or, prior to the Detachable Date, until the transfer of the Offered Security to which such Warrant Certificate is attached, is registered in the register of the Offered Securities], the Company and the Warrant Agent may treat the registered Holder of such Warrant Certificate as the absolute owner thereof for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding. SECTION 4.03. Cancellation of Warrant Certificates. (a) Any Warrant Certificate surrendered for exchange or registration of transfer or exercise of the Warrants evidenced thereby shall, if surrendered to the Company, be delivered to the Warrant Agent, and all Warrant Certificates surrendered or so delivered to the Warrant Agent shall be promptly canceled by the Warrant Agent and shall not be reissued and, except as expressly permitted by this Agreement, no Warrant Certificate shall be issued hereunder in exchange therefor or in lieu thereof. The Warrant Agent shall cause all canceled Warrant Certificates to be destroyed and shall deliver a certificate of such destruction to the Company. (b) If the Company notifies the Trustee of its election to redeem [2: prior to the Detachable Date] [, as a whole but not in part,] [2: the Offered Securities [or] [and]] the Warrant Securities pursuant to the Indenture or the terms thereof, the Company may elect, and shall give notice to the Warrant Agent of its election, to cancel the unexercised Warrants, the Warrant Certificates and the rights evidenced thereby. Promptly after receipt of such notice by the Warrant Agent, the Company shall, or, at the Company's request, the Warrant Agent shall in the name of and at the expense of the Company, give notice of such cancellation to the Holders of the Warrant Certificates [in registered form and to the beneficial owners of the Global Warrant Certificate (except that such notice shall be required to be published only once)], such notice to be so given not less than 30 nor more than 60 days prior to the date fixed for the redemption of [2: the Offered Securities [or] [and]] the Warrant Securities pursuant to the Indenture -15- 20 or the terms thereof. The unexercised Warrants, the Warrant Certificates and the rights evidenced thereby shall be canceled and become void on the 15th day prior to such date fixed for redemption. ARTICLE V CONCERNING THE WARRANT AGENT SECTION 5.01. Warrant Agent. The Company hereby appoints as Warrant Agent of the Company in respect of the Warrants and the Warrant Certificates upon the terms and subject to the conditions herein and in the Warrant Certificates set forth; and hereby accepts such appointment. The Warrant Agent shall have the powers and authority granted to and conferred upon it in the Warrant Certificates and herein and such further powers and authority to act on behalf of the Company as the Company may hereafter grant to or confer upon it. All of the terms and provisions with respect to such powers and authority contained in the Warrant Certificates are subject to and governed by the terms and provisions hereof. SECTION 5.02. Conditions of Warrant Agent's Obligations. The Warrant Agent accepts its obligations herein set forth upon the terms and conditions hereof, including the following, to all of which the Company agrees and to all of which the rights hereunder of the Holders from time to time of the Warrant Certificates shall be subject: (a) Compensation and Indemnification. The Company agrees promptly to pay the Warrant Agent the compensation to be agreed upon with the Company for all services rendered by the Warrant Agent and to reimburse the Warrant Agent for reasonable out-of-pocket expenses (including reasonable attorneys' fees) incurred by the Warrant Agent without negligence, bad faith or breach of this Agreement on its part in connection with the services rendered hereunder by the Warrant Agent. The Company also agrees to indemnify the Warrant Agent for, and to hold it harmless against, any loss, liability or expense incurred without negligence or bad faith on the part of the Warrant Agent, arising out of or in connection with its acting as Warrant Agent hereunder, as well as the reasonable costs and expenses of defending against any claim of such liability. -16- 21 (b) Agent for the Company. In acting under this Agreement and in connection with the Warrants and the Warrant Certificates, the Warrant Agent is acting solely as agent of the Company and does not assume any obligation or relationship of agency or trust for or with any of the Holders of Warrant Certificates or beneficial owners of Warrants. (c) Counsel. The Warrant Agent may consult with counsel satisfactory to it in its reasonable judgment, and the advice of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with the advice of such counsel. (d) Documents. The Warrant Agent shall be protected and shall incur no liability for or in respect of any action taken or thing suffered by it in reliance upon any Warrant Certificate, notice, direction, consent, certificate, affidavit, statement or other paper or document reasonably believed by it to be genuine and to have been presented or signed by the proper parties. (e) Certain Transactions. The Warrant Agent, and its officers, directors and employees, may become the owner of, or acquire any interest in, Warrants, with the same rights that it or they would have if it were not the Warrant Agent hereunder, and, to the extent permitted by applicable law, it or they may engage or be interested in any financial or other transaction with the Company and may act on, or as depositary, trustee or agent for, any committee or body of holders of Warrant Securities or other obligations of the Company as freely as if it were not the Warrant Agent hereunder. Nothing in this Warrant Agreement shall be deemed to prevent the Warrant Agent from acting as Trustee under the Indenture. (f) No Liability for Interest. The Warrant Agent shall have no liability for interest on any monies at any time received by it pursuant to any of the provisions of this Agreement or of the Warrant Certificates. (g) No Liability for Invalidity. The Warrant Agent shall not be under any responsibility with respect to the validity or sufficiency of this Agreement or the execution and delivery hereof (except -17- 22 the due authorization to execute this Agreement and the due execution and delivery hereof by the Warrant Agent) or with respect to the validity or execution of any Warrant Certificates (except its countersignature thereof). (h) No Liability for Recitals. The recitals contained herein shall be taken as the statements of the Company and the Warrant Agent assumes no liability for the correctness of the same. (i) No Implied Obligations. The Warrant Agent shall be obligated to perform only such duties as are herein and in the Warrant Certificates specifically set forth and no implied duties or obligations shall be read into this Agreement or the Warrant Certificates against the Warrant Agent. The Warrant Agent shall not be under any obligation to take any action hereunder which may tend to involve it in any expense or liability, the payment of which within a reasonable time is not, in its reasonable opinion, assured to it. The Warrant Agent shall not be accountable or under any duty or responsibility for the use by the Company of any of the Warrant Certificates countersigned by the Warrant Agent and delivered by it to the Company pursuant to this Agreement or for the application by the Company of the proceeds of the Warrant Certificates. The Warrant Agent shall have no duty or responsibility in case of any default by the Company in the performance of its covenants or agreements contained herein or in the Warrant Certificates or in the case of the receipt of any written demand from a Holder of a Warrant Certificate with respect to such default, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or, except as provided in Section 6.02, to make any demand upon the Company. SECTION 5.03. Resignation and Appointment of Successor. (a) The Company agrees, for the benefit of the Holders from time to time of the Warrant Certificates, that there shall at all times be a Warrant Agent hereunder until all the Warrants have been exercised or are no longer exercisable. (b) The Warrant Agent may at any time resign as such by giving written notice of its resignation to the Company, specifying the desired date on which its resignation shall become effective; provided, however, that such date shall be not less than 90 days after the date on -18- 23 which such notice is given unless the Company agrees to accept shorter notice. Upon receiving such notice of resignation, the Company shall promptly appoint a successor Warrant Agent (which shall be a bank or trust company in good standing, authorized under the laws of the jurisdiction of its organization to exercise corporate trust powers) by written instrument in duplicate signed on behalf of the Company, one copy of which shall be delivered to the resigning Warrant Agent and one copy to the successor Warrant Agent. The Company may, at any time and for any reason, remove the Warrant Agent and appoint a successor Warrant Agent (qualified as aforesaid) by written instrument in duplicate signed on behalf of the Company and specifying such removal and the date when it is intended to become effective, one copy of which shall be delivered to the Warrant Agent being removed and one copy to the successor Warrant Agent. Any resignation or removal of the Warrant Agent and any appointment of a successor Warrant Agent shall become effective upon acceptance of appointment by the successor Warrant Agent as provided in this subsection (b). In the event a successor Warrant Agent has not been appointed and accepted its duties within 90 days of the Warrant Agent's notice of resignation, the Warrant Agent may apply to any court of competent jurisdiction for the designation of a successor Warrant Agent. Upon its resignation or removal, the Warrant Agent shall be entitled to the payment by the Company of the compensation and to the reimbursement of all reasonable out-of-pocket expenses (including reasonable attorneys' fees) incurred by it hereunder as agreed to in Section 5.02(a). (c) The Company shall remove the Warrant Agent and appoint a successor Warrant Agent if the Warrant Agent (i) shall become incapable of acting, (ii) shall be adjudged bankrupt or insolvent, (iii) shall commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to it or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, (iv) shall consent to, or shall have had entered against it a court order for, any such relief or to the appointment of or taking possession by any such official in any involuntary case or other proceedings commenced against it, (v) shall make a general assignment for the benefit of creditors or (vi) shall fail generally to pay its debts as they become due. Upon the appointment as aforesaid of a successor Warrant Agent and acceptance by it of such appointment, the predecessor Warrant Agent shall, if not previously disqualified by operation of law, cease to be Warrant Agent hereunder. -19- 24 (d) Any successor Warrant Agent appointed hereunder shall execute, acknowledge and deliver to its predecessor and the Company an instrument accepting such appointment hereunder, and thereupon such successor Warrant Agent, without any further act, deed or conveyance, shall become vested with all the authority, rights, powers, immunities, duties and obligations of such predecessor with like effect as if originally named as Warrant Agent hereunder, and such predecessor shall thereupon become obligated to transfer, deliver and pay over, and such successor Warrant Agent shall be entitled to receive, all monies, securities and other property on deposit with or held by such predecessor as Warrant Agent hereunder. (e) Any corporation into which the Warrant Agent hereunder may be merged or converted or any corporation with which the Warrant Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Warrant Agent shall be a party, or any corporation to which the Warrant Agent shall sell or otherwise transfer all or substantially all the assets and business of the Warrant Agent, provided that it shall be qualified as aforesaid, shall be the successor Warrant Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto. ARTICLE VI MISCELLANEOUS SECTION 6.01. Amendment. This Agreement and the terms of the Warrants and the Warrant Certificates may be amended by the parties hereto, without the consent of the Holder of any Warrant Certificate or the beneficial owner of any Warrant, for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective or inconsistent provision contained herein or in the Warrant Certificates, or making any other provisions with respect to matters or questions arising under this Agreement as the Company and the Warrant Agent may deem necessary or desirable, provided that such action shall not affect adversely the interests of the Holders of the Warrant Certificates or the beneficial owners of Warrants in any material respect. SECTION 6.02. Notices and Demands to the Company and Warrant Agent. If the Warrant Agent shall receive any -20- 25 notice or demand addressed to the Company by the Holder of a Warrant Certificate pursuant to the provisions of the Warrant Certificates, the Warrant Agent shall promptly forward such notice or demand to the Company. SECTION 6.03. Addresses. Any communication from the Company to the Warrant Agent with respect to this Agreement shall be addressed to , Attention: , and any communication from the Warrant Agent to the Company with respect to this Agreement shall be addressed to The Chubb Corporation, 15 Mountain View Road, P.O. Box 1615, Warren, New Jersey 07061-1615, Attention: Secretary (or such other address as shall be specified in writing by the Warrant Agent or by the Company). SECTION 6.04. Applicable Law. The validity, interpretation and performance of this Agreement and each Warrant Certificate issued hereunder and of the respective terms and provisions hereof and thereof shall be governed by, and construed in accordance with, the laws of the State of New York. SECTION 6.05. Delivery of Prospectus. The Company will furnish to the Warrant Agent sufficient copies of a prospectus relating to the Warrant Securities deliverable upon exercise of Warrants (the "Prospectus"), and the Warrant Agent agrees that upon the exercise of any Warrant, the Warrant Agent will deliver to the Holder of the Warrant Certificate evidencing such Warrant, prior to or concurrently with the delivery of the Warrant Securities issued upon such exercise, a Prospectus. The Warrant Agent shall not, by reason of any such delivery, assume any responsibility for the accuracy or adequacy of such Prospectus. SECTION 6.06. Obtaining of Governmental Approval. The Company will from time to time take all action which may be necessary to obtain and keep effective any and all permits, consents and approvals of governmental agencies and authorities and securities acts filings under United States federal and state laws (including without limitation a registration statement in respect of the Warrants and Warrant Securities under the Securities Act of 1933), which may be or become requisite in connection with the issuance, sale, transfer and delivery of the Warrant Certificates, the exercise of the Warrants, the issuance, sale, transfer and delivery of the Warrant Securities issued upon exercise of the Warrants or upon the expiration of the period during which the Warrants are exercisable. -21- 26 SECTION 6.07. Persons Having Rights Under Warrant Agreement. [Except as otherwise provided in Section 3.03, nothing] [Nothing] in this Agreement shall give to any person other than the Company, the Warrant Agent and the Holders of the Warrant Certificates any right, remedy or claim under or by reason of this Agreement. SECTION 6.08. Headings. The descriptive headings of the several Articles and Sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof. SECTION 6.09. Counterparts. This Agreement may be executed in any number of counterparts, each of which as so executed shall be deemed to be an original, but such counterparts shall together constitute but one and the same instrument. SECTION 6.10. Inspection of Agreement. A copy of this Agreement shall be available at all reasonable times at the principal corporate trust office of the Warrant Agent for inspection by the Holder of any Warrant Certificate. The Warrant Agent may require such Holder to submit his Warrant Certificate for inspection by it. SECTION 6.11. Notices to Holders of Warrants. Any notice to Holders of Warrants evidenced by Warrant Certificates [in registered form] which by any provisions of this Warrant Agreement is required or permitted to be given shall be given by first class mail prepaid at such Holder's address as it appears on the books of the Warrant Agent. [Any notice to beneficial owners of Warrants evidenced by the Global Warrant Certificate which by any provisions of this Warrant Agreement is required or permitted to be given shall be given in the manner provided with respect to Warrant Securities in bearer form in Section ____ of the Indenture]. -22- 27 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and their respective corporate seals to be hereunto affixed and attested, all as of the date first above written. THE CHUBB CORPORATION By________________________ [SEAL] Name: Title: Attest: _______________________ Name: Title: [WARRANT AGENT] By________________________ [SEAL] Name: Title: Attest: _______________________ Name: Title:
-23- 28 Exhibit A FORM OF WARRANT CERTIFICATE [IN REGISTERED FORM] [Face of Warrant Certificate] [[1: This] [2: Prior to this] Warrant Certificate cannot be transferred unless attached to a [Title of Offered Securities].] EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT AGENT AS PROVIDED HEREIN THE CHUBB CORPORATION WARRANTS TO PURCHASE [Title of Warrant Securities] VOID AFTER 5:00 P.M., NEW YORK CITY TIME, ON , 19 No. __________ __________ Warrants This certifies that or registered assigns (the "Registered Holder") is the registered owner of the above indicated number of Warrants, each Warrant entitling such owner to purchase, at any time [after 5:00 P.M., New York City time, on , 19 , and] on or before 5:00 P.M., New York City time, on ,19 , principal amount of [Title of Warrant Securities] (the "Warrant Securities") of The Chubb Corporation (the "Company") issued and to be issued under the Indenture (as hereinafter defined), on the following basis: [on , 19 the exercise price of each Warrant will be ; during the period from , 19 through and including , 19 , the exercise price of each Warrant will be plus [accrued amortization of the original issue discount] [accrued interest] from ,19 [; in each case, the original issue discount will be amortized at a % annual rate, computed on an annual basis using the "interest" method and using a 360-day year consisting of twelve 30-day months] (the "Warrant Price"). [The original issue discount for each principal amount of Warrant Securities is .] The Registered Holder may exercise the Warrants evidenced hereby by providing certain information set forth on the back hereof and by paying in full, [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds,] the Warrant Price for each Warrant exercised (plus accrued interest, if any, on the Warrant Securities to be issued upon exercise of such -24- 29 Warrant from and including the Interest Payment Date (as defined in the Indenture), if any, in respect of such Warrant Securities immediately preceding the Exercise Date to and including the Exercise Date (unless the Exercise Date is after the Regular Record Date (as defined in the Indenture), if any, for such Interest Payment Date, but on or before the immediately succeeding Interest Payment Date for such Warrant Securities, in which event no such accrued interest shall be payable)) to the Warrant Agent (as hereinafter defined) and by surrendering this Warrant Certificate, with the form of election to purchase on the reverse hereof completed and duly executed, at the corporate trust office of [name of Warrant Agent], or its successor, as warrant agent (the "Warrant Agent"), [or ] currently at the address specified on the reverse hereof, and upon compliance with and subject to the conditions set forth herein and in the Warrant Agreement (as hereinafter defined). Any whole number of Warrants evidenced by this Warrant Certificate may be exercised to purchase Warrant Securities in fully registered form in denominations of and any integral multiples thereof. Upon any exercise of fewer than all of the Warrants evidenced by this Warrant Certificate, there shall be issued to the Registered Holder hereof a new Warrant Certificate in registered form evidencing the number of Warrants remaining unexercised. This Warrant Certificate is issued under and in accordance with the Warrant Agreement dated as of ,19 (the "Warrant Agreement") between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Warrant Agreement, to all of which terms and provisions the Registered Holder consents by acceptance hereof. Copies of the Warrant Agreement are on file at the above-mentioned office of the Warrant Agent [and at ]. The Warrant Securities to be issued and delivered upon the exercise of the Warrants evidenced by this Warrant Certificate will be issued under and in accordance with an Indenture dated as of ,19 (the "Indenture") between the Company and The First National Bank of Chicago, as Trustee (the "Trustee"), and will be subject to the terms and provisions contained in the Indenture. Copies of the Indenture and the form of the Warrant Securities are on file at the corporate trust office of the Trustee [and at ]. [1: This] [2: Prior to , 19 this] Warrant Certificate may be transferred [2: only together with the [Title of Offered Securities] (the "Offered Securities") to -25- 30 which this Warrant Certificate was initially attached, and only for the purpose of effecting, or in conjunction with, a transfer of such Offered Securities,] at the corporate trust office of the Warrant Agent [or ] by the Registered Holder or its assigns, in person or by an attorney duly authorized in writing, in the manner and subject to the limitations provided in the Warrant Agreement. [1: After] [2: Except as otherwise provided in the immediately preceding paragraph, after] countersignature by the Warrant Agent and prior to the expiration of this Warrant Certificate, this Warrant Certificate may be exchanged at the corporate trust office of the Warrant Agent [or ] for Warrant Certificates in registered form representing the same aggregate number of Warrants. This Warrant Certificate shall not entitle the Registered Holder hereof to any of the rights of a holder of the Warrant Securities, including, without limitation, the right to receive payments of principal of (premium, if any) or interest, if any, on the Warrant Securities or to enforce any of the covenants of the Indenture. This Warrant Certificate shall not be valid or obligatory for any purpose until countersigned by the Warrant Agent. Dated as of , 19 . THE CHUBB CORPORATION [SEAL] By_____________________________ Attest: ____________________________ Countersigned: ____________________________ As Warrant Agent -26- 31 By__________________________ Authorized Signature [Reverse of Warrant Certificate] Instructions for Exercise of Warrant To exercise the Warrants evidenced hereby, the Registered Holder must pay in full [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds,] the Warrant Price for Warrants exercised (plus any accrued interest as specified in this Warrant Certificate) to [insert name of Warrant Agent] [corporate trust department] [insert address of Warrant Agent], Attn: [or ], which [payment] [wire transfer] must specify the name of the Registered Holder and the number of Warrants exercised by such Registered Holder. In addition, the Registered Holder must complete the information required below and present this Warrant Certificate in person or by mail (certified or registered mail is recommended) to the Warrant Agent at the appropriate address set forth below. This Warrant Certificate, completed and duly executed, must be received by the Warrant Agent within five business days of the [payment] [wire transfer]. To be Executed Upon Exercise of Warrant The undersigned hereby irrevocably elects to exercise _____ Warrants, evidenced by this Warrant Certificate, to purchase _____ principal amount of the [Title of Warrant Securities] (the "Warrant Securities") of The Chubb Corporation and represents that he has tendered payment for such Warrant Securities [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds] to the order of The Chubb Corporation, c/o [insert name and address of Warrant Agent], in the amount of _______ in accordance with the terms hereof. The undersigned requests that said principal amount of Warrant Securities be in registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below. -27- 32 If the number of Warrants exercised is fewer than all of the Warrants evidenced hereby, the undersigned requests that a new Warrant Certificate representing the remaining Warrants evidenced hereby be issued in registered form and delivered either to the undersigned or as otherwise specified in the instructions below. Dated ____________ Name__________________________ (Please Print) __________________ Address_______________________ (Insert Social Security or Other Identifying _______________________ Number of Holder) Signature_____________________
The Warrants evidenced hereby may be exercised at the following addresses: By hand at _________________________________ _________________________________ _________________________________ _________________________________ By mail at _________________________________ _________________________________ _________________________________ _________________________________ [Instructions as to delivery of Warrant Securities and, if applicable, Warrant Certificates evidencing unexercised Warrants - complete as appropriate.] -28- 33 Assignment (Form of Assignment to be Executed if Holder Desires to Transfer Warrants Evidenced Hereby) FOR VALUE RECEIVED hereby sells, assigns and transfers unto Please insert social security for other identifying number__. _____________________________ ____________________________________________________________ (Please print name and address including zip code) ____________________________________________________________ the Warrants represented by the within Warrant Certificate and does hereby irrevocably constitute and appoint _______________ Attorney, to transfer said Warrant Certificate on the books of the Warrant Agent with full power of substitution in the premises. Dated: _________________________________________ Signature (Signature must conform in all respects to name of Registered Holder as specified on the face of this Warrant Certificate and must bear a signature guarantee by a bank, trust company or member broker of the New York, Midwest or Pacific Stock Exchange). Signature Guaranteed ______________________________ -29- 34 Exhibit B [DELETE THIS EXHIBIT IF WARRANT CERTIFICATES IN ONLY REGISTERED FORM ARE TO BE ISSUED] [FORM OF GLOBAL WARRANT CERTIFICATE IN BEARER FORM] [Face of Global Warrant Certificate] [[1: The] [2: Prior to , the] beneficial ownership of any Warrants evidenced by this Global Warrant Certificate may be transferred only together with the beneficial ownership of the Temporary Global Security referred to herein to which this Global Warrant Certificate was initially attached.] EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT AGENT AS PROVIDED HEREIN THE CHUBB CORPORATION GLOBAL WARRANT CERTIFICATE REPRESENTING __________ WARRANTS TO PURCHASE OF UP TO __________ PRINCIPAL AMOUNT OF [Title of Warrant Securities] VOID AFTER [TIME], ON 19 . This Global Warrant Certificate evidences warrants (the "Warrants") representing the right to purchase, subject to the terms and conditions hereof and of the Debt Warrant Agreement referred to below, at any time [after [time] on 19 and] on or before the [time] in [location] on 19 up to aggregate principal amount of [Title of Warrant Securities] (the "Warrant Securities") of The Chubb Corporation (the "Company") issued and to be issued under the Indenture (as hereinafter defined), on the following basis: on 19 the exercise price of each Warrant will be ; during the period from 19 through and including 19 the exercise price of each Warrant will be plus [accrued amortization of the original issue discount] [accrued interest] from 19 on 19 the exercise price of each Warrant will be during the period 35 from 19 through and including 19 the exercise price of each Warrant will be plus [accrued amortization of the original issue discount] [accrued interest] from 19 [; in each case, the original issue discount will be amortized at a % annual rate, computed on an annual basis using the "interest" method and using a 360-day year consisting of twelve 30-day months] (the "Warrant Price"). [The original issue discount of each principal amount of Warrant Securities is .] Beneficial owners of Warrants represented by this Global Warrant Certificate may cause such Warrants to be exercised only by transmitting by tested telex or by delivering or causing to be delivered to Morgan Guaranty Trust Company of New York, Brussels office, as operator of the Euro-clear System (the "Euro-clear Operator"), in Brussels, Belgium, or to Centrale de Livraison de Valeurs Mobilieres S.A. ("CEDEL") in Luxembourg, a warrant exercise notice, substantially in the form attached as Exhibit D to the Debt Warrant Agreement referred to below (the "Warrant Exercise Notice"), copies of which will be available from the Euro-clear Operator or CEDEL or from [name or Warrant Agent], or its successor as warrant agent (the "Warrant Agent") under the Debt Warrant Agreement (the "Debt Warrant Agreement") dated as of 19 between the Company and the Warrant Agent. The Warrant Exercise Notice shall specify, among other things, the aggregate principal amount of Warrant Securities to be purchased on exercise of the Warrants, the account number or numbers on the records of the Euro-clear Operator or CEDEL to which the Warrants being exercised [2: and, if prior to 19 the Offered Securities (as defined below)] to which such Warrants are attached are credited, the account number to be debited for the Warrant Price of each Warrant being exercised (plus accrued interest, if any, on the Warrant Securities to be issued upon exercise of such Warrant from and including the Interest Payment Date (as defined in the Indenture), if any, in respect of such Warrant Securities immediately preceding the Exercise Date to and including the Exercise Date (unless the Exercise Date is after the Regular Record Date (as defined in the Indenture), if any, for such Interest Payment Date, but on or before the immediately succeeding Interest Payment Date for such Warrant Securities, in which event no such accrued interest shall be payable in respect of Warrant Securities to be issued in registered form)), the account number to which the Warrant Securities issued on exercise of the Warrants are to be credited and the form in which Warrant Securities are to be issued. A Warrant Exercise Notice must be received by the Euro-clear Operator or CEDEL prior to [time] (Brussels or Luxembourg time, as the case may be) on the business day next preceding the Exercise Date (as defined in such Warrant Exercise Notice). The delivery to the Euro-clear Operator or CEDEL, as the case may -2- 36 be, of a Warrant Exercise Notice shall constitute an irrevocable election to purchase the aggregate principal amount of Warrant Securities specified therein. Any whole number of Warrants evidenced by this Global Warrant Certificate may be exercised to purchase Warrant Securities in bearer or registered form in denominations of [ or , in the case of Warrant Securities in bearer form, and of and any integral multiple thereof, in the case of Warrant Securities in registered form; provided, however, that no Warrant Security in bearer form shall be mailed or otherwise delivered to any location in the United States of America, its territories or possessions or areas subject to its jurisdiction or the Commonwealth of Puerto Rico (the "United States"). The Warrants evidenced by this Global Warrant Certificate, this Global Warrant Certificate and the rights evidenced hereby may be canceled in the manner and under the circumstances described in the Debt Warrant Agreement. Notice of cancellation of the Warrants evidenced by this Global Warrant Certificate, this Global Warrant Certificate and the rights evidenced hereby shall be given by publication in the manner described in the Debt Warrant Agreement. This Global Warrant Certificate is issued under and in accordance with the Debt Warrant Agreement between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Debt Warrant Agreement, to all of which terms and provisions the holder hereof consents by acceptance hereof. Copies of the Debt Warrant Agreement are on file at the above-mentioned office of the Warrant Agent [and at ]. The Warrant Securities to be issued and delivered upon the exercise of the Warrants evidenced by this Global Warrant Certificate will be issued under and in accordance with an Indenture dated as of ___________ 19__ (the "Indenture") between the Company and The First National Bank of Chicago, as Trustee (the "Trustee"), and will be subject to the terms and provisions contained in the Indenture. Copies of the Indenture and the form of the Warrant Securities are on file at the corporate trust office of the Trustee [and at . [1: The] [2: Prior to 19 the] beneficial ownership of any Warrants evidenced by this Global Warrant Certificate may be transferred only together with the beneficial ownership of the Temporary Global Security (as defined in the Debt Warrant Agreement) evidencing the [Title of Offered Securities] (the "Offered Securities") to which this Global Warrant Certificate was initially attached, and -3- 37 only for the purpose of effecting, or in conjunction with, a transfer of such Temporary Global Security. After such date, the Global Warrant Certificate, and all rights hereunder, may be transferred by delivery, and the Company and the Warrant Agent may treat the holder hereof as the owner for all purposes. This Global Warrant Certificate shall not entitle the Holder hereof to any of the rights of a holder of the Warrant Securities, including, without limitation, the right to receive payments of principal of, premium, if any, or interest, if any, on the Warrant Securities or to enforce any of the covenants of the Indenture. This Global Warrant Certificate shall not be valid or obligatory for any purpose until countersigned by the Warrant Agent. Dated as of , 19 . THE CHUBB CORPORATION By_____________________________ Attest: ____________________________ Countersigned: ____________________________ As Warrant Agent By__________________________ Authorized Signature -4- 38 Schedule A (additional continuation sheets may be attached if required) Exercises of Warrants The following exercises of a portion of this Global Warrant Certificate or Warrant Securities have been made: -5- 39
Date of Number of Warrants Remaining Number of Notation Exercised for Warrants Following Exercise Warrant Securities such Exercise Made - -------- ------------------ ------------------- -------- By: - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- --------
-6- 40 Exhibit C [DELETE THIS EXHIBIT IF WARRANT CERTIFICATES IN ONLY REGISTERED FORM ARE TO BE ISSUED] [FORM OF CERTIFICATE TO BE DELIVERED TO WARRANT AGENT BY THE EURO-CLEAR OPERATOR OR CEDEL] THE CHUBB CORPORATION Warrants (the "Warrants") to Purchase [Title of Warrant Securities] [Name of Warrant Agent] [Address] Dear Sirs: The undersigned hereby irrevocably elects to exercise __________ Warrants to purchase as of (the "Exercise Date") _____ principal amount of the [title of Warrant Securities] (the "Warrant Securities") of The Chubb Corporation and represents that it has tendered payment for such Warrant Securities [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds] to the order of The Chubb Corporation, c/o [insert name and address of Warrant Agent], in the amount of _____ in accordance with the terms hereof and the Debt Warrant Agreement dated as of 19 between The Chubb Corporation and you (the "Debt Warrant Agreement"). In connection with the Undersigned's request that you deliver to us any Warrant Securities in bearer form, the undersigned hereby certifies that as of the date hereof the Warrant Securities in bearer form which are to be delivered to the Common Depositary referred to below for our account are not being acquired, directly or indirectly, by or on behalf of a United States person (as defined below) or for offer to resell or for resale to a United States person or any person inside the United States (as defined below) or, if a beneficial interest in any such Warrant Securities is being acquired by or on behalf of a United States person, that such United States person is either a financial institution within 41 the meaning of Section 1.165-12(c)(1)(v) of the United States Treasury regulations or is acquiring through such a financial institution and that such Warrant Securities are held by a financial institution that has agreed to comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder and that is not purchasing for offer to resell or for resale inside the United States. As a clearing organization within the meaning of Section 1.163-5(c)(2)(i)(B)(4) of the regulations promulgated under the Internal Revenue Code of 1986, as amended, the undersigned further certifies that (a) the above certification is based solely on statements received from member organizations appearing in our records (our "Account Holders") in certificates in the form set forth in Exhibit D to the Debt Warrant Agreement and (b) as of the date hereof we have not received any notification from any of our Account Holders to the effect that the statements made by such Account Holders in such certificates are no longer true. "United States person" means any citizen, national or resident of the United States, any corporation, partnership or other entity created or organized in or under the laws of the United States or any political subdivision thereof, or any estate or trust the income of which is subject to United States federal income taxation regardless of its source. "United States" means the United States of America, its territories and possessions and areas subject to its jurisdiction and the Commonwealth of Puerto Rico. We hereby undertake to notify you immediately by telex if any of the statements of our Account Holders referred to above is not correct at any time on or before the Warrant Securities in bearer form are delivered. We further agree to cause a confirmation substantially in the form of Exhibit E to the Debt Warrant Agreement and a copy of the prospectus relating to the Warrant Securities delivered to us as contemplated by Section 6.05 of the Debt Warrant Agreement to be delivered to our Account Holders entitled to such Warrant Securities prior to or contemporaneously with our transfer of such Warrant Securities to or to the account of such Account Holders. We understand that this certificate is required in connection with United States laws, tax laws and regulations. We irrevocably authorize you to produce this Certificate or a copy hereof to any interested party in any administrative or legal proceedings with respect to the matters covered by this Certificate. -2- 42 The undersigned requests that said principal amount of Warrant Securities be [in registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below] [bearer form in the authorized denominations and delivered to as Common Depositary under the Debt Warrant Agreement, to be held for our account]** [Instructions as to delivery of Warrant Securities to be issued in registered form]. Dated: ______________, 19__ Very truly yours, [MORGAN GUARANTY TRUST COMPANY OF NEW YORK, Brussels Office, as operator of the Euro-clear System]* By__________________________ Title: [CENTRALE DE LIVRAISONS DE VALEURS MOBILIERES S.A.]* By__________________________ Title: - -------------------- **Delete inapplicable reference. -3- 43 Exhibit D [DELETE THIS EXHIBIT IF WARRANT CERTIFICATES IN ONLY REGISTERED FORM ARE TO BE ISSUED] [FORM OF WARRANT EXERCISE NOTICE] [Morgan Guaranty Trust Company of New York, Brussels Office, as operator of the Euro-clear System (the "Euro-clear Operator") ***] [Address] Centrale de Livraison de Valeurs Mobilieres S.A.* [Address] THE CHUBB CORPORATION WARRANTS (THE "WARRANTS") TO PURCHASE [Title of Warrant Securities] (the "Warrant Securities") Dear Sirs: We hereby irrevocably elect to exercise __________ Warrants to purchase _________ (being _______________ or an integral multiple thereof) aggregate principal amount of Warrant Securities of The Chubb Corporation (the "Company") on ____________, 19 __ (the "Exercise Date"). The account number(s) on your books in which the Warrants being exercised [and the [Title of Offered Securities] to which such Warrants are attached]**** are held is (are) ________________________. The Warrant Securities to be issued to us on exercise of the Warrants are to be credited to such account, unless otherwise indicated below and shall be in [registered] [bearer]* form in the following authorized denominations: _______________________. - --------------------- ***Delete inapplicable reference. ****Delete if dated on or after 19 . 44 We hereby request that you complete a certification in the form required by the Debt Warrant Agreement hereinafter referred to and make payment directly to [ ], as Warrant Agent (the "Warrant Agent", which term shall include its successors as such Warrant Agent), under the Debt Warrant Agreement dated as of [ ] between the Company and the Warrant Agent (the "Debt Warrant Agreement") at or prior to [time] on the Exercise Date, or if the Exercise Date is the last day on which Warrants may be exercised under the Debt Warrant Agreement, prior to [time] in [location] on the Exercise Date, [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds] of ____________, such amount being the Warrant Price (as defined in the Global Warrant Certificate representing the Warrants, as provided in Section 1.02 of the Debt Warrant Agreement) for Warrants exercised (plus any accrued interest as specified in such Global Warrant Certificate) on the Exercise Date, and debit account number ___________ for said amount. The undersigned hereby certifies that as of the date hereof, the Warrant Securities which are to be delivered in bearer form are not being acquired, directly or indirectly, by or on behalf of a United States person or for offer to resell or for resale to a United States person or any person inside the United States (as defined below) or, if a beneficial interest in such Warrant Securities is being acquired by or on behalf of a United States person, that such United States person is either a financial institution within the meaning of Section 1.165-12(c)(1)(v) of the United States Treasury regulations or is acquiring such beneficial interest through such financial institution and that such beneficial interest is held by a financial institution which agrees to comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder and which is not purchasing for offer to resell or for resale inside the United States. If the undersigned is a dealer, the undersigned agrees to obtain a similar certificate from each person entitled to delivery of any Warrant Securities in bearer form purchased from it; provided, however, that if the undersigned has actual knowledge that the information contained in such a certificate is false, the undersigned will not deliver a Warrant Security in temporary or definitive bearer form to the person who signed such certificate notwithstanding the delivery of such certificate to the undersigned. The undersigned will be deemed to have actual knowledge if, inter alia, the undersigned has a United States address for the beneficial owner of such Warrant Security (other than a financial institution as defined in -2- 45 Section 1.165-12(c)(1)(v) that represents that it will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder), unless the undersigned has documentary evidence (as described in A-5 of Section 35a.9999-4T of the regulations promulgated under the Internal Revenue Code of 1986, as amended) that the beneficial owner of such Warrant Security is not a United States person. If this certificate is being provided by a clearing organization, it is based on statements provided to it by its member organizations. As used herein, a "clearing organization" is an entity which is in the business of holding obligations for member organizations and transferring obligations among such members by credit or debit to the account of a member without the necessity of physical delivery of the obligation. We undertake to advise you immediately by telex if the foregoing statement as to beneficial ownership is not correct on or before the date of delivery of such Warrant Securities as to the entire principal amount of the Warrant Securities to be issuable upon exercise [then appearing on your books as being held for our account]. We understand that this certificate is required in connection with certain tax regulations in the United States. If administrative or legal proceedings are commenced or threatened in connection with which this certificate is or would be relevant, we irrevocably authorize you to produce this certificate or a copy thereof to any interested party in such proceedings. "United States person" means any citizen, national or resident of the United States or any political subdivision thereof, any corporation, partnership or other entity created or organized in or under laws of the United States, or any estate or trust the income of which is subject to United States federal income taxation regardless of its source. "United States" means the United States of America, -3- 46 its territories and possessions and areas subject to its jurisdiction and the Commonwealth of Puerto Rico. Dated: ____________, 19__ Very truly yours, [Name and, if appropriate, title] As the beneficial owner(s) of the interest in the Warrants to which this Warrant Exercise Notice relates. By____________________________ Title: -4- 47 Exhibit E [DELETE THIS EXHIBIT IF WARRANT CERTIFICATES IN ONLY REGISTERED FORM ARE TO BE ISSUED] [FORM OF CONFIRMATION TO BE DELIVERED TO PURCHASERS OF WARRANT SECURITIES IN BEARER FORM] THE CHUBB CORPORATION [Title of Warrant Securities] (the "Warrant Securities") By your purchase of Warrant Securities in bearer form you represent that you are not a United States person or, if you are a United States person, that you are a financial institution as defined in Section 1.165-12(c)(1)(v) of the Treasury Department regulations, purchasing for your own account or for the account of a customer and that you will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended from time to time, and the regulations thereunder. Furthermore, if you are a dealer, you agree that you will deliver a confirmation containing this entire paragraph to purchasers of such Securities from you. For purposes of this statement, "United States person" means any citizen, national or resident of the United States, any corporation, partnership or other entity created or organized in or under the laws of the United States or any political subdivision thereof or any estate or trust the income of which is subject to United States federal income taxation regardless of its source, and "United States" means the United States of America, its territories and possessions and areas subject to its jurisdiction and the Commonwealth of Puerto Rico. EX-4.14 11 CAPITAL DEBT WARRANT AGREEMENT 1 Exhibit 4.14 CHUBB CAPITAL CORPORATION and _________________ as Warrant Agent __________________________ DEBT WARRANT AGREEMENT Dated as of ________________ ____________________________ Warrants to Purchase ________ ____________________ 2 TABLE OF CONTENTS*
PAGE ---- PARTIES ............................................................................. RECITALS ............................................................................ 1 ARTICLE I ISSUANCE OF WARRANTS [AND TEMPORARY GLOBAL SECURITY] AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES SECTION 1.01. Issuance of Warrants ............................................. 2 SECTION 1.02. Execution and Delivery of Warrant Certificates ........................................ 2 SECTION 1.03. Issuance of Warrant Certificates ................................. 4 [SECTION 1.04. Temporary Global Security ........................................ 5] ARTICLE II WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS SECTION 2.01. Warrant Price ........................................................ 5 SECTION 2.02. Duration of Warrants ................................................. 6 SECTION 2.03. Exercise of Warrants ................................................. 6
___________________ * The Table of Contents is not a part of the Agreement. i 3
ARTICLE III OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES SECTION 3.01. No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates .................................................... 10 SECTION 3.02. Lost, Mutilated, Stolen or Destroyed Warrant Certificates .................................. 11 SECTION 3.03. Enforcement of Rights .............................................. 11 SECTION 3.04. Merger, Consolidation, Conveyance or Transfer ..................................................... 11 ARTICLE IV EXCHANGE AND TRANSFER SECTION 4.01. Exchange and Transfer .............................................. 12 SECTION 4.02. Treatment of Holders of Warrant Certificates ............................................ 13 SECTION 4.03. Cancellation of Warrant Certificates .................................................... 14 ARTICLE V CONCERNING THE WARRANT AGENT SECTION 5.01. Warrant Agent ...................................................... 15 SECTION 5.02. Conditions of Warrant Agent's Obligations ..................................................... 15 SECTION 5.03. Resignation and Appointment of Successor .................................................... 17
-ii- 4
ARTICLE VI MISCELLANEOUS SECTION 6.01. Amendment .......................................................... 19 SECTION 6.02. Notices and Demands to the Company and Warrant Agent ............................................... 19 SECTION 6.03. Addresses .......................................................... 19 SECTION 6.04. Applicable Law ..................................................... 19 SECTION 6.05. Delivery of Prospectus ............................................. 19 SECTION 6.06. Obtaining of Governmental Approval ........................................................ 20 SECTION 6.07. Persons Having Rights Under Warrant Agreement ............................................... 20 SECTION 6.08. Headings ........................................................... 20 SECTION 6.09. Counterparts ....................................................... 20 SECTION 6.10. Inspection of Agreement ............................................ 20 SECTION 6.11. Notices to Holders of Warrants ..................................... 20 TESTIMONIUM ....................................................................... 22 SIGNATURES ....................................................................... 22 EXHIBIT A - Form of Warrant Certificate [in Registered Form] [EXHIBIT B - Form of Global Warrant Certificate in Bearer Form] [EXHIBIT C - Form of Certificate to be Delivered to the Warrant Agent by the Euro-clear Operator or CEDEL] [EXHIBIT D - Form of Warrant Exercise Notice] [EXHIBIT E - Form of Confirmation to be Delivered to Purchasers of Warrant Securities in Bearer Form]
-iii- 5 DEBT WARRANT AGREEMENT* THIS AGREEMENT dated as of between CHUBB CAPITAL CORPORATION, a corporation duly organized and existing under the laws of the State of New Jersey (the "Company"), and, a [bank] [trust company] duly incorporated and existing under the laws of , as Warrant Agent (the "Warrant Agent"). W I T N E S S E T H : WHEREAS, the Company has entered into an Indenture dated as of _____________, 19__ (the "Indenture") between the Company, The Chubb Corporation, as Guarantor and The First National Bank of Chicago, as Trustee (the "Trustee"), providing for the issuance from time to time of its debt securities to be issued in one or more series, all of such debt securities to be guaranteed by The Chubb Corporation, all as provided in the Indenture; and WHEREAS, the Company proposes to sell [Title of such debt securities being offered] (the "Offered Securities") with one or more warrants (the "Warrants") representing the right to purchase [title of such debt securities purchasable through exercise of Warrants] (the "Warrant Securities"), the Warrants to be evidenced by Warrant certificates issued pursuant to this Agreement (the "Warrant Certificates") and WHEREAS, the Company desires the Warrant Agent to act on behalf of the Company in connection with the __________________________________ * Complete or modify the provisions as appropriate to reflect the terms of the Warrants and Warrant Securities. Monetary amounts may be in U.S. dollars, in a foreign currency or in a composite currency, including but not limited to the European Currency Unit. Bracketed language here and throughout this Agreement should be inserted as follows: 1. If Warrants are immediately detachable from the Offered Securities; and 2. If Warrants are detachable from the Offered Securities only after the Detachable Date. -1- 6 issuance, transfer, exchange, exercise and replacement of the Warrant Certificates, and in this Agreement wishes to set forth, among other things, the form[s] and provisions of the Warrant Certificates and the terms and conditions on which they may be issued, transferred, exchanged, exercised and replaced; NOW, THEREFORE, in consideration of the premises and of the mutual agreements herein contained, the parties hereto agree as follows: ARTICLE I ISSUANCE OF WARRANTS [AND TEMPORARY GLOBAL SECURITY] AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES SECTION 1.01. Issuance of Warrants. The Warrants shall be evidenced by one or more Warrant Certificates. Each Warrant evidenced thereby shall represent the right, subject to the provisions contained herein and therein, to purchase a Warrant Security in the principal amount of and shall be initially issued in connection with the issuance of the Offered Securities [1: and shall be separately transferable immediately thereafter] [2: but shall not be separately transferable until on and after , 19 (the "Detachable Date")]. The Warrants shall be initially issued [in units] with the Offered Securities, and each Warrant [included in such a unit] shall evidence the right, subject to the provisions contained herein and in the Warrant Certificates, to purchase [ ] principal amount of Warrant Securities [included in such a unit]. SECTION 1.02. Execution and Delivery of Warrant Certificates. Each Warrant, whenever issued, shall be evidenced by a Warrant Certificate in registered form [or a global Warrant Certificate in bearer form (the "Global Warrant Certificate")] [the form to be the same as that of the Warrant Security in connection with which the Warrant Certificate is issued], substantially in the form[s] set forth in Exhibit A [and Exhibit B, respectively,] hereto, shall be dated and may have such letters, numbers or other marks of identification or designation and such legends or endorsements printed, lithographed or engraved thereon as the officers of the Company executing the same may approve (execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Agreement, or as may be required to -2- 7 comply with any law or with any rule or regulation made pursuant thereto or with any rule or regulation of any stock exchange on which the Warrants may be listed, or to conform to usage. The Warrant Certificates shall be signed on behalf of the Company by its Chairman of the Board of Directors, the President, any Executive Vice President, any Senior Vice President or any Vice President or the Treasurer of the Company, in each case under its corporate seal, which may but need not be, attested by its Secretary or one of its Assistant Secretaries [, except that the Global Warrant Certificate may be executed by any such officer without any necessity that such signature be under seal as aforesaid]. Such signatures may be manual or facsimile signatures of such authorized officers and may be imprinted or otherwise reproduced on the Warrant Certificates. The corporate seal of the Company may be in the form of a facsimile thereof and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant Certificates. No Warrant Certificate shall be valid for any purpose, and no Warrant evidenced thereby shall be exercisable, until such Warrant Certificate has been countersigned by the Warrant Agent by manual signature. Such signature by the Warrant Agent upon any Warrant Certificate executed by the Company shall be conclusive evidence, and the only evidence, that the Warrant Certificate so countersigned has been duly issued hereunder. [The Global Warrant Certificate shall be and remain subject to the provisions of this Agreement until such time as all of the Warrants evidenced thereby shall have been duly exercised or shall have expired or been canceled in accordance with the terms thereof.] In case any officer of the Company who shall have signed any of the Warrant Certificates either manually or by facsimile signature shall cease to be such officer before the Warrant Certificates so signed shall have been countersigned and delivered by the Warrant Agent as provided herein, such Warrant Certificates may be countersigned and delivered notwithstanding that the person who signed such Warrant Certificates ceased to be such officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by such persons as, at the actual date of the execution of such Warrant Certificate, shall be the proper officers of the Company, although at the date of the execution of this Agreement any such person was not such officer. -3- 8 The term "Holder", when used with respect to any Warrant Certificate [in registered form], shall mean any person in whose name at the time such Warrant Certificate shall be registered upon the books to be maintained by the Warrant Agent for that purpose [2: or, prior to the Detachable Date, any person in whose name at the time the Offered Security to which such Warrant Certificate is attached is registered upon the register of the Offered Securities. Prior to the Detachable Date, the Company will, or will cause the registrar of the Offered Securities to, make available at all times to the Warrant Agent such information as to holders of the Offered Securities with Warrants as may be necessary to keep the Warrant Agent's records up to date.] [The term "Holder", when used with respect to the Global Warrant Certificate, shall mean [2:, prior to the Detachable Date, the bearer of the Temporary Global Security (as defined in Section 1.04) evidencing the Offered Securities to which the Warrants evidenced by the Global Warrant Certificate were initially attached and, after the Detachable Date,] the bearer of the Global Warrant Certificate.] SECTION 1.03. Issuance of Warrant Certificates. Warrant Certificates evidencing the right to purchase an aggregate principal amount not exceeding aggregate principal amount of Warrant Securities (except as provided in Sections 2.03, 3.02 and 4.01) may be executed by the Company and delivered to the Warrant Agent upon the execution of this Warrant Agreement or from time to time thereafter. The Warrant Agent shall, upon receipt of Warrant Certificates duly executed on behalf of the Company, countersign Warrant Certificates evidencing Warrants representing the right to purchase up to aggregate principal amount of Warrant Securities and shall [, in the case of Warrant Certificates in registered form,] deliver such Warrant Certificates to or upon the order of the Company [and, in the case of the Global Warrant Certificate, upon the order of the Company, deposit the Global Warrant Certificate with , as common depositary (the "Common Depositary") for Morgan Guaranty Trust Company of New York, Brussels office as operator of the Euro-clear System (the "Euro-clear Operator"), and for Centrale de Livraison de Valeurs Mobilieres S.A. ("CEDEL") for credit to the accounts of persons appearing from time to time on the records of the Euro-clear Operator or of CEDEL as being entitled to any portion thereof. [2: The Temporary Global Security [, as defined in Section 1.04,] will at the same time be deposited with the Common Depositary.] [The Global Warrant Certificate shall be held by the Common Depositary -4- 9 outside the United Kingdom.]] Subsequent to such original issuance of the Warrant Certificates, the Warrant Agent shall countersign a Warrant Certificate only if the Warrant Certificate is issued in exchange or substitution for one or more previously countersigned Warrant Certificates or [, with respect to Warrant Certificates in registered form,] in connection with their transfer as hereinafter provided or as provided in the antepenultimate paragraph of Section 2.03]. Pending the preparation of definitive Warrant Certificates [in registered form] evidencing Warrants, the Company may execute and the Warrant Agent shall countersign and deliver temporary Warrant Certificates [in registered form] evidencing such Warrants (printed, lithographed, typewritten or otherwise produced, in each case in form satisfactory to the Warrant Agent). Such temporary Warrant Certificates shall be issuable substantially in the form of the definitive Warrant Certificates [in registered form] but with such omissions, insertions and variations as may be appropriate for temporary Warrant Certificates, all as may be determined by the Company with the concurrence of the Warrant Agent. Such temporary Warrant Certificates may contain such reference to any provisions of this Warrant Agreement as may be appropriate. Every such temporary Warrant Certificate shall be executed by the Company and shall be countersigned by the Warrant Agent upon the same conditions and in substantially the same manner, and with like effect, as the definitive Warrant Certificates [in registered form]. Without unreasonable delay, the Company shall execute and shall furnish definitive Warrant Certificates [in registered form] and thereupon such temporary Warrant Certificates may be surrendered in exchange therefor without charge pursuant to and subject to the provisions of Section 4.01, and the Warrant Agent shall countersign and deliver in exchange for such temporary Warrant Certificates definitive Warrant Certificates [in registered form] of authorized denominations evidencing a like aggregate number of Warrants evidenced by such temporary Warrant Certificates. Until so exchanged, such temporary Warrant Certificates shall be entitled to the same benefits under this Warrant Agreement as definitive Warrant Certificates [in registered form]. [2: SECTION 1.04. Temporary Global Security. Prior to the Detachable Date, each Offered Security to be issued with Warrants evidenced by the Global Warrant Certificate shall, whenever issued, be evidenced by a single temporary global Offered Security in bearer form without interest coupons (the "Temporary Global Security") to be issued by the Company as provided in the Indenture.] -5- 10 ARTICLE II WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS SECTION 2.01. Warrant Price. On ________________, 19__ the exercise price of each Warrant will be . During the period from , 19 through and including , 19 , the exercise price of each Warrant will be plus [accrued amortization of the original issue discount] [accrued interest] from , 19 . On , 19 the exercise price of each Warrant will be . During the period from , 19 through and including , 19 , the exercise price of each Warrant will be plus [accrued amortization of the original issue discount] [accrued interest] from , 19 . [In each case, the original issue discount will be amortized at a % annual rate, computed on an annual basis using the "interest" method and using a 360-day year consisting of twelve 30-day months]. Such exercise price of Warrant Securities is referred to in this Agreement as the "Warrant Price". [The original issue discount for each principal amount of Warrant Securities is ]. SECTION 2.02. Duration of Warrants. Subject to Section 4.03(b), each Warrant may be exercised [in whole but not in part] [in whole or in part] [at any time, as specified herein, on or after [the date thereof] [ , 19 ] and at or before [time, location] on , 19 (each day during such period may hereinafter be referred to as an "Exercise Date")] [on [list of specific dates] (each, an "Exercise Date")], or such later date as the Company may designate by notice to the Warrant Agent and the Holders of Warrant Certificates [in registered form and to the beneficial owners of the Global Warrant Certificate] (the "Expiration Date"). Each Warrant not exercised at or before [time, location] on the Expiration Date shall become void, and all rights of the Holder [and any beneficial owners] of the Warrant Certificate evidencing such Warrant under this Agreement shall cease. SECTION 2.03. Exercise of Warrants. [During] [With respect to Warrants evidenced by Warrant Certificates in registered form, during] the period specified in Section 2.02, any whole number of Warrants may be exercised by providing certain information as set forth on the reverse side of the Warrant Certificates evidencing such Warrants and by paying in full [in lawful money of the United States -6- 11 of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds,] the Warrant Price for each Warrant exercised (plus accrued interest, if any, on the Warrant Securities to be issued upon exercise of such Warrant from and including the Interest Payment Date (as defined in the Indenture), if any, in respect of such Warrant Securities immediately preceding the Exercise Date to and including the Exercise Date (unless the Exercise Date is after the Regular Record Date (as defined in the Indenture), if any, for such Interest Payment Date, but on or before the immediately succeeding Interest Payment Date for such Warrant Securities, in which event no such accrued interest shall be payable in respect of Warrant Securities to be issued in registered form)) to the Warrant Agent at its corporate trust office at [address] [or at ], provided that such exercise is subject to receipt within five business days of such [payment] [wire transfer] by the Warrant Agent of the Warrant Certificate evidencing each Warrant exercised with the form of election to purchase Warrant Securities set forth on the reverse side of the Warrant Certificate properly completed and duly executed. [With respect to Warrants evidenced by the Global Warrant Certificate, during the period specified in Section 2.02, any whole number of Warrants may be exercised by the Holder by presentation to the Warrant Agent at its office at [address located outside the United States [and the United Kingdom]], at or prior to [time], on any day on which the Warrants are exercisable, of (i) the Global Warrant Certificate [2: together with, if prior to the Detachable Date, the Temporary Global Security] (or written confirmation reasonably satisfactory to the Warrant Agent that the Global Warrant Certificate [1: is] [2: and, if prior to the Detachable Date, the Temporary Global Security are] held by the Euro-clear Operator and CEDEL and will be duly endorsed to reflect the exercise of Warrants [2: and, if prior to the Detachable Date, the surrender to the Warrant Agent of the Offered Securities to which the Warrants are attached] by the Euro-clear Operator and CEDEL), (ii) a duly executed certification from the Euro-clear Operator or CEDEL, as the case may be, substantially in the form set forth in Exhibit C hereto and (iii) payment in full [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds,] of the Warrant Price for each Warrant exercised (plus accrued interest, if any, on the Warrant Securities to be issued upon exercise of such Warrant from -7- 12 and including the Interest Payment Date, if any, in respect of such Warrant Securities immediately preceding the Exercise Date to and including the Exercise Date (unless the Exercise Date is after the Regular Record Date, if any, for such Interest Payment Date, but on or before the immediately succeeding Interest Payment Date for such Warrant Securities, in which event no such accrued interest shall be payable in respect of Warrant Securities to be issued in registered form)). Notwithstanding the foregoing, the Holder may exercise Warrants as aforesaid on the Expiration Date at any time prior to [time] in [city of Warrant Agent's office]. Any Warrants exercised as set forth in this paragraph shall be deemed exercised at the [country] office of the Warrant Agent.] [The Warrant Agent shall retain each certificate received by it from the Euro-clear Operator or CEDEL through the Expiration Date (or such earlier date by which all of the Warrants may have been exercised or canceled) and thereafter shall dispose of them or deliver them to the Company pursuant to the instructions of the Company.] [The delivery to the Warrant Agent by the Euro-clear Operator or CEDEL of any certification referred to above may be relied upon by the Company, the Warrant Agent and the Trustee as conclusive evidence that a corresponding certificate or certificates substantially in the form of Exhibit D hereto has or have been delivered to the Euro-clear Operator or CEDEL, as the case may be.] [The Company will maintain in [location] (or in such other city [in western Europe] as the Company may deem advisable), until the right to exercise the Warrants shall expire or be earlier canceled as hereinafter provided, an agency where the Global Warrant Certificate [2: and, if prior to the Detachable Date, the Temporary Global Security] may be presented for exercise of the Warrants represented thereby [2: and, if prior to the Detachable Date, for surrender for cancellation of the Offered Securities to which such Warrants are attached] and notices and demands to or upon the Company in respect of the Warrants or of this Agreement may be made.] The date on which payment in full of the Warrant Price (plus any such accrued interest) is received by the Warrant Agent shall, subject to receipt of the Warrant Certificate [in registered form or, as the case may be, the Global Warrant Certificate [2: and, if required, the Temporary Global Security] and the certification of Euro-clear Operator or CEDEL] as aforesaid, be deemed to be the date on which the Warrant is exercised. The Warrant -8- 13 Agent shall deposit all funds received by it in payment for the exercise of Warrants in an account of the Company maintained with it (or in such other account as may be designated by the Company) and shall advise the Company, by telephone or by facsimile transmission or other form of electronic communication available to both parties, at the end of each day on which a payment for the exercise of Warrants is received of the amount so deposited to its account. The Warrant Agent shall promptly confirm such advice to the Company in writing. If a day on which Warrants may be exercised in the city in which such Warrants are to be exercised shall be a Saturday or Sunday or a day on which banking institutions in such city are authorized or required to be closed, then, notwithstanding any other provision of this Agreement or the Warrant Certificate evidencing such Warrants, but subject to the limitation that no Warrant may be exercised after the Expiration Date, the Warrants shall be exercisable on the next succeeding day which in such city is not a Saturday or Sunday or a day on which banking institutions in such city are authorized or required to be closed. The Warrant Agent shall, from time to time, as promptly as practicable, advise the Company [and][,] the Trustee [and the Common Depositary at [both] its London and [location] office[s]] in writing [(which, in the case of exercised Warrants represented by the Global Warrant Certificate, shall be tested telex with appropriate answerback received,)] of (i) the number of Warrants exercised, (ii) the instructions of each Holder of the Warrant Certificates [in registered form] evidencing such Warrants [or of the Euro-clear Operator or CEDEL, as the case may be,] with respect to delivery of the Warrant Securities to be issued upon such exercise, (iii) delivery of any Warrant Certificates [in registered form] evidencing the balance, if any, of the Warrants remaining after such exercise, and (iv) such other information as the Company or the Trustee shall reasonably require. [In addition, in the case of exercised Warrants evidenced by the Global Warrant Certificate, the Warrant Agent shall, as promptly as practicable, endorse, or cause the Common Depositary, [location] office, or one of the Warrant Agent's agents to endorse, Schedule A annexed to the Global Warrant Certificate to reflect the exercise of such Warrants [2: and the Temporary Global Security to reflect the surrender for cancellation of the Offered Securities to which such Warrants are attached] and, if applicable, return the Global Warrant Certificate [2: and the Temporary Global Security] to the Common Depositary or to its order.] -9- 14 As soon as practicable after the exercise of any Warrant [evidenced by a Warrant Certificate in registered form], but subject to receipt by the Warrant Agent of the Warrant Certificate evidencing such Warrant as provided in this Section, the Company shall issue, pursuant to the Indenture, in authorized denominations to or upon the order of the Holder of the Warrant Certificate evidencing each Warrant, the Warrant Securities to which such Holder is entitled, in fully registered form, registered in such name or names as may be directed by such Holder. If fewer than all of the Warrants evidenced by such Warrant Certificate are exercised, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, a new Warrant Certificate [in registered form] evidencing the number of such Warrants remaining unexercised. [As soon as practicable after the exercise of any Warrant evidenced by the Global Warrant Certificate, the Company shall issue, pursuant to the Indenture, the Warrant Securities issuable upon such exercise, in authorized denominations (i) in fully registered form, registered in such name or names as may be directed by the Euro-clear Operator or CEDEL, as the case may be, to or upon order of the Euro-clear Operator or CEDEL, as the case may be, or (ii) in bearer form to the Common Depositary to be held for the account of the Euro-clear Operator or CEDEL, as the case may be, together with a written confirmation substantially in form of Exhibit E hereto; provided, however, that no Warrant Security in bearer form shall be mailed or otherwise delivered to any location in the United States of America, its territories or possessions or areas subject to its jurisdiction or the Commonwealth of Puerto Rico.] The Company shall not be required to pay any stamp or other tax or other governmental charge required to be paid in connection with any transfer involved in the issuance of the Warrant Securities, and in the event that any such transfer is involved, the Company shall not be required to issue or deliver any Warrant Security until such tax or other charge shall have been paid or it has been established to the Company's satisfaction that no such tax or other charge is due. -10- 15 ARTICLE III OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES SECTION 3.01. No Rights as Warrant Securityholder Conferred by Warrants or Warrant Certificates. No Warrant Certificate or Warrant evidenced thereby shall entitle the Holder or any beneficial owner thereof to any of the rights of a holder or beneficial owner of Warrant Securities, including, without limitation, the right to receive the payment of principal of (premium, if any) or interest, if any, on Warrant Securities or to enforce any of the covenants in the Indenture. SECTION 3.02. Lost, Mutilated, Stolen, or Destroyed Warrant Certificates. Upon receipt by the Warrant Agent of evidence reasonably satisfactory to it and the Company of the ownership of and the loss, mutilation, theft or destruction of any Warrant Certificate and of such security or indemnity as may be required by the Company and the Warrant Agent to hold each of them and any agent of them harmless and, in the case of mutilation of a Warrant Certificate, upon surrender thereof to the Warrant Agent for cancellation, then, in the absence of notice to the Company or the Warrant Agent that such Warrant Certificate has been acquired by a bona fide purchaser, the Company shall execute, and an authorized officer of the Warrant Agent shall manually countersign and deliver, in exchange for or in lieu of the lost, mutilated, stolen or destroyed Warrant Certificate, a new Warrant Certificate of the same tenor and evidencing a like number of Warrants[; provided, however, that any Global Warrant Certificate shall be so delivered only to the Common Depositary.] Upon the issuance of any new Warrant Certificate under this Section, the Company may require the payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Warrant Agent) in connection therewith. Every substitute Warrant Certificate executed and delivered pursuant to this Section in lieu of any lost, mutilated, stolen or destroyed Warrant Certificate shall represent an additional contractual obligation of the Company, whether or not the lost, stolen or destroyed Warrant Certificate shall be at any time enforceable by anyone, and shall be entitled to the benefits of this Agreement equally and proportionately with any and all other Warrant Certificates duly executed and delivered hereunder. The provisions of this Section are exclusive and shall -11- 16 preclude (to the extent lawful) all other rights and remedies with respect to the replacement of lost, mutilated, stolen or destroyed Warrant Certificates. SECTION 3.03. Enforcement of Rights. Notwithstanding any of the provisions of this Agreement, any Holder of a Warrant Certificate [in registered form or the beneficial owner of any Warrant evidenced by the Global Warrant Certificate], without the consent of [the Common Depositary,] the Warrant Agent, the Trustee, the holder of any Offered Securities or the Holder of any other Warrant Certificate, may, in its own behalf and for its own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company suitable to enforce, or otherwise in respect of, its right to exercise its Warrants in the manner provided in its Warrant Certificate [or the Global Warrant Certificate, as the case may be,] and in this Agreement. [Neither the Company nor the Warrant Agent shall be required to treat any person as a beneficial owner of any Warrant evidenced by the Global Warrant Certificate unless such person is so certified as such a beneficial owner by the Euro-clear Operator or CEDEL.] SECTION 3.04. Merger, Consolidation, Share Exchange, Conveyance or Transfer. (a) If at any time there shall be a merger or consolidation of the Company or a statutory share exchange to which the Company is a party or a conveyance or transfer of its property and assets substantially as an entirety as permitted under the Indenture, then in any such event the successor or assuming corporation referred to therein shall succeed to and be substituted for the Company, with the same effect, subject to the Indenture, as if it had been named herein and in the Warrant Certificates as the Company; the Company shall thereupon, except in the case of a transfer by way of lease, be relieved of any further obligation hereunder and under the Warrants and the Warrant Certificates, and the Company as the predecessor corporation, except in the case of a transfer by way of lease, may thereupon or at any time thereafter be dissolved, wound up or liquidated. Such successor or assuming corporation may thereupon cause to be signed, and may issue either in its own name or in the name of the Company, Warrant Certificates evidencing any or all of the Warrants issuable hereunder which theretofore shall not have been signed by the Company, and may execute and deliver Warrant Securities in its own name pursuant to the Indenture, in fulfillment of its obligations to deliver Warrant Securities upon exercise of the Warrants. All the Warrants so issued shall in all respects have the same legal rank and benefit under this Agreement as the Warrants theretofore or thereafter issued in accordance with the -12- 17 terms of this Agreement as though all of such Warrants had been issued at the date of the execution hereof. In any case of any such merger, consolidation, share exchange, conveyance or transfer, such changes in phraseology and form (but not in substance) may be made in the Warrant Certificates representing the Warrants thereafter to be issued as may be appropriate. (b) The Warrant Agent may receive a written opinion of legal counsel (who shall be acceptable to the Warrant Agent) as conclusive evidence that any such merger, consolidation, share exchange, conveyance or transfer complies with the provisions of this Section and the Indenture. ARTICLE IV EXCHANGE AND TRANSFER SECTION 4.01. Exchange and Transfer. (a) [1: Upon] [2: Prior to] the Detachable Date, a Warrant Certificate [in registered form] may be exchanged or transferred only together with the Offered Security to which such Warrant Certificate was initially attached, and only for the purpose of effecting, or in conjunction with, an exchange or transfer of such Offered Security. Prior to the Detachable Date, the transfer of the beneficial ownership of any Warrant evidenced by the Global Warrant Certificate shall effect and shall be deemed to effect the transfer of the beneficial ownership of any Offered Securities evidenced by the Temporary Global Security that are attached to such Warrants. Prior to any Detachable Date, each transfer of the Offered Security [on the register maintained with respect to the Offered Securities, in the case of an Offered Security that is in registered form], shall operate also to transfer the related Warrant Certificates. Similarly, prior to the Detachable Date, the transfer of the beneficial ownership of any Offered Security evidenced by the Temporary Global Security shall be deemed to be the transfer of the beneficial ownership of any Warrants evidenced by the Global Warrant Certificate that are attached to such Offered Securities. The transfer of the beneficial ownership of Warrants and Warrant Securities hereunder shall be effected only as provided in Section 4.01. On or after the Detachable Date, upon] surrender at the corporate trust office of the Warrant Agent at [address] [or ], Warrant Certificates [in registered form] evidencing Warrants may be exchanged for Warrant Certificates [in registered form] in -13- 18 other authorized denominations evidencing such Warrants or the transfer thereof may be registered in whole or in part; provided, however, that such other Warrant Certificates shall evidence the same aggregate number of Warrants as the Warrant Certificates so surrendered. (b) The Warrant Agent shall keep, at its corporate trust office at [address] [and at ], books in which, subject to such reasonable regulations as it may prescribe, it shall register Warrant Certificates [in registered form] and exchanges and transfers of outstanding Warrant Certificates [in registered form] upon surrender of such Warrant Certificates to the Warrant Agent at its corporate trust office at [address] or [ ] for exchange or registration of transfer, properly endorsed [or accompanied by appropriate instruments of registration of transfer and written instructions for transfer, all in form satisfactory to the Company and the Warrant Agent.] (c) No service charge shall be made for any exchange or registration of transfer of Warrant Certificates [in registered form], but the Company may require payment of a sum sufficient to cover any stamp or other tax or other governmental charge that may be imposed in connection with any such exchange or registration of transfer. (d) Whenever any Warrant Certificates [in registered form], are so surrendered for exchange or registration of transfer, an authorized officer of the Warrant Agent shall manually countersign and deliver to the person or persons entitled thereto a Warrant Certificate or Warrant Certificates [in registered form], duly authorized and executed by the Company, as so requested. The Warrant Agent shall not effect any exchange or registration of transfer which will result in the issuance of a Warrant Certificate [in registered form], evidencing a fraction of a Warrant or a number of full Warrants and a fraction of a Warrant. (e) All Warrant Certificates [in registered form], issued upon any exchange or registration of transfer of Warrant Certificates shall be the valid obligations of the Company, evidencing the same obligations, and entitled to the same benefits under this Agreement, as the Warrant Certificates surrendered for such exchange or registration or transfer. SECTION 4.02. Treatment of Holders of Warrant Certificates. [With respect to the Global Warrant Certificate, the Holder thereof may be treated by the Company, the Warrant Agent and all other persons dealing -14- 19 with such Holder as the absolute owner thereof for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding.] [Each] [With respect to Warrant Certificates in registered form, each] Holder of a Warrant Certificate, by accepting the same, consents and agrees with the Company, the Warrant Agent and every subsequent Holder of such Warrant Certificate that until the transfer of such Warrant Certificate is registered on the books of such Warrant Agent [2: or, prior to the Detachable Date, until the transfer of the Offered Security to which such Warrant Certificate is attached, is registered in the register of the Offered Securities], the Company and the Warrant Agent may treat the registered Holder of such Warrant Certificate as the absolute owner thereof for any purpose and as the person entitled to exercise the rights represented by the Warrants evidenced thereby, any notice to the contrary notwithstanding. SECTION 4.03. Cancellation of Warrant Certificates. (a) Any Warrant Certificate surrendered for exchange or registration of transfer or exercise of the Warrants evidenced thereby shall, if surrendered to the Company, be delivered to the Warrant Agent, and all Warrant Certificates surrendered or so delivered to the Warrant Agent shall be promptly canceled by the Warrant Agent and shall not be reissued and, except as expressly permitted by this Agreement, no Warrant Certificate shall be issued hereunder in exchange therefor or in lieu thereof. The Warrant Agent shall cause all canceled Warrant Certificates to be destroyed and shall deliver a certificate of such destruction to the Company. (b) If the Company notifies the Trustee of its election to redeem [2: prior to the Detachable Date] [, as a whole but not in part,] [2: the Offered Securities [or] [and]] the Warrant Securities pursuant to the Indenture or the terms thereof, the Company may elect, and shall give notice to the Warrant Agent of its election, to cancel the unexercised Warrants, the Warrant Certificates and the rights evidenced thereby. Promptly after receipt of such notice by the Warrant Agent, the Company shall, or, at the Company's request, the Warrant Agent shall in the name of and at the expense of the Company, give notice of such cancellation to the Holders of the Warrant Certificates [in registered form and to the beneficial owners of the Global Warrant Certificate (except that such notice shall be required to be published only once)], such notice to be so given not less than 30 nor more than 60 days prior to the date fixed for the redemption of [2: the Offered Securities [or] [and]] the Warrant Securities pursuant to the Indenture -15- 20 or the terms thereof. The unexercised Warrants, the Warrant Certificates and the rights evidenced thereby shall be canceled and become void on the 15th day prior to such date fixed for redemption. ARTICLE V CONCERNING THE WARRANT AGENT SECTION 5.01. Warrant Agent. The Company hereby appoints as Warrant Agent of the Company in respect of the Warrants and the Warrant Certificates upon the terms and subject to the conditions herein and in the Warrant Certificates set forth; and hereby accepts such appointment. The Warrant Agent shall have the powers and authority granted to and conferred upon it in the Warrant Certificates and herein and such further powers and authority to act on behalf of the Company as the Company may hereafter grant to or confer upon it. All of the terms and provisions with respect to such powers and authority contained in the Warrant Certificates are subject to and governed by the terms and provisions hereof. SECTION 5.02. Conditions of Warrant Agent's Obligations. The Warrant Agent accepts its obligations herein set forth upon the terms and conditions hereof, including the following, to all of which the Company agrees and to all of which the rights hereunder of the Holders from time to time of the Warrant Certificates shall be subject: (a) Compensation and Indemnification. The Company agrees promptly to pay the Warrant Agent the compensation to be agreed upon with the Company for all services rendered by the Warrant Agent and to reimburse the Warrant Agent for reasonable out-of-pocket expenses (including reasonable attorneys' fees) incurred by the Warrant Agent without negligence, bad faith or breach of this Agreement on its part in connection with the services rendered hereunder by the Warrant Agent. The Company also agrees to indemnify the Warrant Agent for, and to hold it harmless against, any loss, liability or expense incurred without negligence or bad faith on the part of the Warrant Agent, arising out of or in connection with its acting as Warrant Agent hereunder, as well as the reasonable costs and expenses of defending against any claim of such liability. -16- 21 (b) Agent for the Company. In acting under this Agreement and in connection with the Warrants and the Warrant Certificates, the Warrant Agent is acting solely as agent of the Company and does not assume any obligation or relationship of agency or trust for or with any of the Holders of Warrant Certificates or beneficial owners of Warrants. (c) Counsel. The Warrant Agent may consult with counsel satisfactory to it in its reasonable judgment, and the advice of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in accordance with the advice of such counsel. (d) Documents. The Warrant Agent shall be protected and shall incur no liability for or in respect of any action taken or thing suffered by it in reliance upon any Warrant Certificate, notice, direction, consent, certificate, affidavit, statement or other paper or document reasonably believed by it to be genuine and to have been presented or signed by the proper parties. (e) Certain Transactions. The Warrant Agent, and its officers, directors and employees, may become the owner of, or acquire any interest in, Warrants, with the same rights that it or they would have if it were not the Warrant Agent hereunder, and, to the extent permitted by applicable law, it or they may engage or be interested in any financial or other transaction with the Company and may act on, or as depositary, trustee or agent for, any committee or body of holders of Warrant Securities or other obligations of the Company as freely as if it were not the Warrant Agent hereunder. Nothing in this Warrant Agreement shall be deemed to prevent the Warrant Agent from acting as Trustee under the Indenture. (f) No Liability for Interest. The Warrant Agent shall have no liability for interest on any monies at any time received by it pursuant to any of the provisions of this Agreement or of the Warrant Certificates. (g) No Liability for Invalidity. The Warrant Agent shall not be under any responsibility with respect to the validity or sufficiency of this Agreement or the execution and delivery hereof (except -17- 22 the due authorization to execute this Agreement and the due execution and delivery hereof by the Warrant Agent) or with respect to the validity or execution of any Warrant Certificates (except its countersignature thereof). (h) No Liability for Recitals. The recitals contained herein shall be taken as the statements of the Company and the Warrant Agent assumes no liability for the correctness of the same. (i) No Implied Obligations. The Warrant Agent shall be obligated to perform only such duties as are herein and in the Warrant Certificates specifically set forth and no implied duties or obligations shall be read into this Agreement or the Warrant Certificates against the Warrant Agent. The Warrant Agent shall not be under any obligation to take any action hereunder which may tend to involve it in any expense or liability, the payment of which within a reasonable time is not, in its reasonable opinion, assured to it. The Warrant Agent shall not be accountable or under any duty or responsibility for the use by the Company of any of the Warrant Certificates countersigned by the Warrant Agent and delivered by it to the Company pursuant to this Agreement or for the application by the Company of the proceeds of the Warrant Certificates. The Warrant Agent shall have no duty or responsibility in case of any default by the Company in the performance of its covenants or agreements contained herein or in the Warrant Certificates or in the case of the receipt of any written demand from a Holder of a Warrant Certificate with respect to such default, including, without limiting the generality of the foregoing, any duty or responsibility to initiate or attempt to initiate any proceedings at law or otherwise or, except as provided in Section 6.02, to make any demand upon the Company. SECTION 5.03. Resignation and Appointment of Successor. (a) The Company agrees, for the benefit of the Holders from time to time of the Warrant Certificates, that there shall at all times be a Warrant Agent hereunder until all the Warrants have been exercised or are no longer exercisable. (b) The Warrant Agent may at any time resign as such by giving written notice of its resignation to the Company, specifying the desired date on which its resignation shall become effective; provided, however, that such date shall be not less than 90 days after the date on -18- 23 which such notice is given unless the Company agrees to accept shorter notice. Upon receiving such notice of resignation, the Company shall promptly appoint a successor Warrant Agent (which shall be a bank or trust company in good standing, authorized under the laws of the jurisdiction of its organization to exercise corporate trust powers) by written instrument in duplicate signed on behalf of the Company, one copy of which shall be delivered to the resigning Warrant Agent and one copy to the successor Warrant Agent. The Company may, at any time and for any reason, remove the Warrant Agent and appoint a successor Warrant Agent (qualified as aforesaid) by written instrument in duplicate signed on behalf of the Company and specifying such removal and the date when it is intended to become effective, one copy of which shall be delivered to the Warrant Agent being removed and one copy to the successor Warrant Agent. Any resignation or removal of the Warrant Agent and any appointment of a successor Warrant Agent shall become effective upon acceptance of appointment by the successor Warrant Agent as provided in this subsection (b). In the event a successor Warrant Agent has not been appointed and accepted its duties within 90 days of the Warrant Agent's notice of resignation, the Warrant Agent may apply to any court of competent jurisdiction for the designation of a successor Warrant Agent. Upon its resignation or removal, the Warrant Agent shall be entitled to the payment by the Company of the compensation and to the reimbursement of all reasonable out-of-pocket expenses (including reasonable attorneys' fees) incurred by it hereunder as agreed to in Section 5.02(a). (c) The Company shall remove the Warrant Agent and appoint a successor Warrant Agent if the Warrant Agent (i) shall become incapable of acting, (ii) shall be adjudged bankrupt or insolvent, (iii) shall commence a voluntary case or other proceeding seeking liquidation, reorganization or other relief with respect to it or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of it or any substantial part of its property, (iv) shall consent to, or shall have had entered against it a court order for, any such relief or to the appointment of or taking possession by any such official in any involuntary case or other proceedings commenced against it, (v) shall make a general assignment for the benefit of creditors or (vi) shall fail generally to pay its debts as they become due. Upon the appointment as aforesaid of a successor Warrant Agent and acceptance by it of such appointment, the predecessor Warrant Agent shall, if not previously disqualified by operation of law, cease to be Warrant Agent hereunder. -19- 24 (d) Any successor Warrant Agent appointed hereunder shall execute, acknowledge and deliver to its predecessor and the Company an instrument accepting such appointment hereunder, and thereupon such successor Warrant Agent, without any further act, deed or conveyance, shall become vested with all the authority, rights, powers, immunities, duties and obligations of such predecessor with like effect as if originally named as Warrant Agent hereunder, and such predecessor shall thereupon become obligated to transfer, deliver and pay over, and such successor Warrant Agent shall be entitled to receive, all monies, securities and other property on deposit with or held by such predecessor as Warrant Agent hereunder. (e) Any corporation into which the Warrant Agent hereunder may be merged or converted or any corporation with which the Warrant Agent may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Warrant Agent shall be a party, or any corporation to which the Warrant Agent shall sell or otherwise transfer all or substantially all the assets and business of the Warrant Agent, provided that it shall be qualified as aforesaid, shall be the successor Warrant Agent under this Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto. ARTICLE VI MISCELLANEOUS SECTION 6.01. Amendment. This Agreement and the terms of the Warrants and the Warrant Certificates may be amended by the parties hereto, without the consent of the Holder of any Warrant Certificate or the beneficial owner of any Warrant, for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective or inconsistent provision contained herein or in the Warrant Certificates, or making any other provisions with respect to matters or questions arising under this Agreement as the Company and the Warrant Agent may deem necessary or desirable, provided that such action shall not affect adversely the interests of the Holders of the Warrant Certificates or the beneficial owners of Warrants in any material respect. SECTION 6.02. Notices and Demands to the Company and Warrant Agent. If the Warrant Agent shall receive any -20- 25 notice or demand addressed to the Company by the Holder of a Warrant Certificate pursuant to the provisions of the Warrant Certificates, the Warrant Agent shall promptly forward such notice or demand to the Company. SECTION 6.03. Addresses. Any communication from the Company to the Warrant Agent with respect to this Agreement shall be addressed to , Attention: , and any communication from the Warrant Agent to the Company with respect to this Agreement shall be addressed to Chubb Capital Corporation, 15 Mountain View Road, P.O. Box 1615, Warren, New Jersey 07061- 1615, Attention: Secretary (or such other address as shall be specified in writing by the Warrant Agent or by the Company). SECTION 6.04. Applicable Law. The validity, interpretation and performance of this Agreement and each Warrant Certificate issued hereunder and of the respective terms and provisions hereof and thereof shall be governed by, and construed in accordance with, the laws of the State of New York. SECTION 6.05. Delivery of Prospectus. The Company will furnish to the Warrant Agent sufficient copies of a prospectus relating to the Warrant Securities deliverable upon exercise of Warrants (the "Prospectus"), and the Warrant Agent agrees that upon the exercise of any Warrant, the Warrant Agent will deliver to the Holder of the Warrant Certificate evidencing such Warrant, prior to or concurrently with the delivery of the Warrant Securities issued upon such exercise, a Prospectus. The Warrant Agent shall not, by reason of any such delivery, assume any responsibility for the accuracy or adequacy of such Prospectus. SECTION 6.06. Obtaining of Governmental Approval. The Company will from time to time take all action which may be necessary to obtain and keep effective any and all permits, consents and approvals of governmental agencies and authorities and securities acts filings under United States federal and state laws (including without limitation a registration statement in respect of the Warrants and Warrant Securities under the Securities Act of 1933), which may be or become requisite in connection with the issuance, sale, transfer and delivery of the Warrant Certificates, the exercise of the Warrants, the issuance, sale, transfer and delivery of the Warrant Securities issued upon exercise of the Warrants or upon the expiration of the period during which the Warrants are exercisable. -21- 26 SECTION 6.07. Persons Having Rights Under Warrant Agreement. [Except as otherwise provided in Section 3.03, nothing] [Nothing] in this Agreement shall give to any person other than the Company, the Warrant Agent and the Holders of the Warrant Certificates any right, remedy or claim under or by reason of this Agreement. SECTION 6.08. Headings. The descriptive headings of the several Articles and Sections of this Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof. SECTION 6.09. Counterparts. This Agreement may be executed in any number of counterparts, each of which as so executed shall be deemed to be an original, but such counterparts shall together constitute but one and the same instrument. SECTION 6.10. Inspection of Agreement. A copy of this Agreement shall be available at all reasonable times at the principal corporate trust office of the Warrant Agent for inspection by the Holder of any Warrant Certificate. The Warrant Agent may require such Holder to submit his Warrant Certificate for inspection by it. SECTION 6.11. Notices to Holders of Warrants. Any notice to Holders of Warrants evidenced by Warrant Certificates [in registered form] which by any provisions of this Warrant Agreement is required or permitted to be given shall be given by first class mail prepaid at such Holder's address as it appears on the books of the Warrant Agent. [Any notice to beneficial owners of Warrants evidenced by the Global Warrant Certificate which by any provisions of this Warrant Agreement is required or permitted to be given shall be given in the manner provided with respect to Warrant Securities in bearer form in Section ____ of the Indenture]. -22- 27 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and their respective corporate seals to be hereunto affixed and attested, all as of the date first above written. CHUBB CAPITAL CORPORATION By__________________________ [SEAL] Name: Title: Attest: _________________________________ Name: Title: [WARRANT AGENT] By__________________________ [SEAL] Name: Title: Attest: _________________________________ Name: Title: -23- 28 Exhibit A FORM OF WARRANT CERTIFICATE [IN REGISTERED FORM] [Face of Warrant Certificate] [[1: This] [2: Prior to this] Warrant Certificate cannot be transferred unless attached to a [Title of Offered Securities].] EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT AGENT AS PROVIDED HEREIN CHUBB CAPITAL CORPORATION WARRANTS TO PURCHASE [Title of Warrant Securities] VOID AFTER 5:00 P.M., NEW YORK CITY TIME, ON , 19 No. __________ __________ Warrants This certifies that or registered assigns (the "Registered Holder") is the registered owner of the above indicated number of Warrants, each Warrant entitling such owner to purchase, at any time [after 5:00 P.M., New York City time, on , 19 , and] on or before 5:00 P.M., New York City time, on ,19 , principal amount of [Title of Warrant Securities] (the "Warrant Securities") of Chubb Capital Corporation (the "Company") issued and to be issued under the Indenture (as hereinafter defined), on the following basis: [on , 19 the exercise price of each Warrant will be ; during the period from , 19 through and including , 19 , the exercise price of each Warrant will be plus [accrued amortization of the original issue discount] [accrued interest] from ,19 [; in each case, the original issue discount will be amortized at a % annual rate, computed on an annual basis using the "interest" method and using a 360-day year consisting of twelve 30-day months] (the "Warrant Price"). [The original issue discount for each principal amount of Warrant Securities is .] the Registered Holder may exercise the Warrants evidenced hereby by providing certain information set forth on the back hereof and by paying in full, [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds,] the Warrant Price for each Warrant exercised (plus accrued interest, if any, on the Warrant Securities to be issued upon exercise of such -24- 29 Warrant from and including the Interest Payment Date (as defined in the Indenture), if any, in respect of such Warrant Securities immediately preceding the Exercise Date to and including the Exercise Date (unless the Exercise Date is after the Regular Record Date (as defined in the Indenture), if any, for such Interest Payment Date, but on or before the immediately succeeding Interest Payment Date for such Warrant Securities, in which event no such accrued interest shall be payable)) to the Warrant Agent (as hereinafter defined) and by surrendering this Warrant Certificate, with the form of election to purchase on the reverse hereof completed and duly executed, at the corporate trust office of [name of Warrant Agent], or its successor, as warrant agent (the "Warrant Agent"), [or ] currently at the address specified on the reverse hereof, and upon compliance with and subject to the conditions set forth herein and in the Warrant Agreement (as hereinafter defined). Any whole number of Warrants evidenced by this Warrant Certificate may be exercised to purchase Warrant Securities in fully registered form in denominations of and any integral multiples thereof. Upon any exercise of fewer than all of the Warrants evidenced by this Warrant Certificate, there shall be issued to the Registered Holder hereof a new Warrant Certificate in registered form evidencing the number of Warrants remaining unexercised. This Warrant Certificate is issued under and in accordance with the Warrant Agreement dated as of ,19 (the "Warrant Agreement") between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Warrant Agreement, to all of which terms and provisions the Registered Holder consents by acceptance hereof. Copies of the Warrant Agreement are on file at the above-mentioned office of the Warrant Agent [and at ]. The Warrant Securities to be issued and delivered upon the exercise of the Warrants evidenced by this Warrant Certificate will be issued under and in accordance with an Indenture dated as of ,19 (the "Indenture") between the Company and The First National Bank of Chicago, as Trustee (the "Trustee"), and will be subject to the terms and provisions contained in the Indenture. Copies of the Indenture and the form of the Warrant Securities are on file at the corporate trust office of the Trustee [and at ]. [1: This] [2: Prior to , 19 this] Warrant Certificate may be transferred [2: only together with the [Title of Offered Securities] (the "Offered Securities") to -25- 30 which this Warrant Certificate was initially attached, and only for the purpose of effecting, or in conjunction with, a transfer of such Offered Securities,] at the corporate trust office of the Warrant Agent [or ] by the Registered Holder or its assigns, in person or by an attorney duly authorized in writing, in the manner and subject to the limitations provided in the Warrant Agreement. [1: After] [2: Except as otherwise provided in the immediately preceding paragraph, after] countersignature by the Warrant Agent and prior to the expiration of this Warrant Certificate, this Warrant Certificate may be exchanged at the corporate trust office of the Warrant Agent [or ] for Warrant Certificates in registered form representing the same aggregate number of Warrants. This Warrant Certificate shall not entitle the Registered Holder hereof to any of the rights of a holder of the Warrant Securities, including, without limitation, the right to receive payments of principal of (premium, if any) or interest, if any, on the Warrant Securities or to enforce any of the covenants of the Indenture. This Warrant Certificate shall not be valid or obligatory for any purpose until countersigned by the Warrant Agent. Dated as of , 19 . CHUBB CAPITAL CORPORATION [SEAL] By_____________________________ Attest: ____________________________ Countersigned: ____________________________ As Warrant Agent -26- 31 By__________________________ Authorized Signature [Reverse of Warrant Certificate] Instructions for Exercise of Warrant To exercise the Warrants evidenced hereby, the Registered Holder must pay in full [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds,] the Warrant Price for Warrants exercised (plus any accrued interest as specified in this Warrant Certificate) to [insert name of Warrant Agent] [corporate trust department] [insert address of Warrant Agent], Attn: [or ], which [payment] [wire transfer] must specify the name of the Registered Holder and the number of Warrants exercised by such Registered Holder. In addition, the Registered Holder must complete the information required below and present this Warrant Certificate in person or by mail (certified or registered mail is recommended) to the Warrant Agent at the appropriate address set forth below. This Warrant Certificate, completed and duly executed, must be received by the Warrant Agent within five business days of the [payment] [wire transfer]. To be Executed Upon Exercise of Warrant The undersigned hereby irrevocably elects to exercise _____ Warrants, evidenced by this Warrant Certificate, to purchase _____ principal amount of the [Title of Warrant Securities] (the "Warrant Securities") of Chubb Capital Corporation and represents that he has tendered payment for such Warrant Securities [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds] to the order of Chubb Capital Corporation, c/o [insert name and address of Warrant Agent], in the amount of _______ in accordance with the terms hereof. The undersigned requests that said principal amount of Warrant Securities be in registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below. -27- 32 If the number of Warrants exercised is fewer than all of the Warrants evidenced hereby, the undersigned requests that a new Warrant Certificate representing the remaining Warrants evidenced hereby be issued in registered form and delivered either to the undersigned or as otherwise specified in the instructions below. Dated _______________ Name_________________________________ (Please Print) _____________________ Address______________________________ (Insert Social Security or Other Identifying ____________________________ Number of Holder) Signature___________________________ The Warrants evidenced hereby may be exercised at the following addresses: By hand at _________________________________ _________________________________ _________________________________ _________________________________ By mail at _________________________________ _________________________________ _________________________________ _________________________________ [Instructions as to delivery of Warrant Securities and, if applicable, Warrant Certificates evidencing unexercised Warrants - complete as appropriate.] -28- 33 Assignment (Form of Assignment to be Executed if Holder Desires to Transfer Warrants Evidenced Hereby) FOR VALUE RECEIVED hereby sells, assigns and transfers unto Please insert social security for other identifying number__. _____________________________ ________________________________________________________________________________ (Please print name and address including zip code) ________________________________________________________________________________ the Warrants represented by the within Warrant Certificate and does hereby irrevocably constitute and appoint _______________ Attorney, to transfer said Warrant Certificate on the books of the Warrant Agent with full power of substitution in the premises. Dated: ______________________________ Signature (Signature must conform in all respects to name of Registered Holder as specified on the face of this Warrant Certificate and must bear a signature guarantee by a bank, trust company or member broker of the New York, Midwest or Pacific Stock Exchange). Signature Guaranteed ______________________________ -29- 34 Exhibit B [DELETE THIS EXHIBIT IF WARRANT CERTIFICATES IN ONLY REGISTERED FORM ARE TO BE ISSUED] [FORM OF GLOBAL WARRANT CERTIFICATE IN BEARER FORM] [Face of Global Warrant Certificate] [[1: The] [2: Prior to , the] beneficial ownership of any Warrants evidenced by this Global Warrant Certificate may be transferred only together with the beneficial ownership of the Temporary Global Security referred to herein to which this Global Warrant Certificate was initially attached.] EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT AGENT AS PROVIDED HEREIN CHUBB CAPITAL CORPORATION GLOBAL WARRANT CERTIFICATE REPRESENTING __________ WARRANTS TO PURCHASE OF UP TO __________ PRINCIPAL AMOUNT OF [Title of Warrant Securities] VOID AFTER [TIME], ON 19 . This Global Warrant Certificate evidences warrants (the "Warrants") representing the right to purchase, subject to the terms and conditions hereof and of the Debt Warrant Agreement referred to below, at any time [after [time] on 19 and] on or before the [time] in [location] on 19 up to aggregate principal amount of [Title of Warrant Securities] (the "Warrant Securities") of Chubb Capital Corporation (the "Company") issued and to be issued under the Indenture (as hereinafter defined), on the following basis: on 19 the exercise price of each Warrant will be ; during the period from 19 through and including 19 the exercise price of each Warrant will be plus [accrued amortization of the original issue discount] [accrued interest] from 19 on 19 the exercise price of each Warrant will be during the 35 period from 19 through and including 19 the exercise price of each Warrant will be plus [accrued amortization of the original issue discount] [accrued interest] from 19 [; in each case, the original issue discount will be amortized at a % annual rate, computed on an annual basis using the "interest" method and using a 360-day year consisting of twelve 30-day months] (the "Warrant Price"). [The original issue discount of each principal amount of Warrant Securities is .] Beneficial owners of Warrants represented by this Global Warrant Certificate may cause such Warrants to be exercised only by transmitting by tested telex or by delivering or causing to be delivered to Morgan Guaranty Trust Company of New York, Brussels office, as operator of the Euro-clear System (the "Euro-clear Operator"), in Brussels, Belgium, or to Centrale de Livraison de Valeurs Mobilieres S.A. ("CEDEL") in Luxembourg, a warrant exercise notice, substantially in the form attached as Exhibit D to the Debt Warrant Agreement referred to below (the "Warrant Exercise Notice"), copies of which will be available from the Euro-clear Operator or CEDEL or from [name or Warrant Agent], or its successor as warrant agent (the "Warrant Agent") under the Debt Warrant Agreement (the "Debt Warrant Agreement") dated as of 19 between the Company and the Warrant Agent. The Warrant Exercise Notice shall specify, among other things, the aggregate principal amount of Warrant Securities to be purchased on exercise of the Warrants, the account number or numbers on the records of the Euro-clear Operator or CEDEL to which the Warrants being exercised [2: and, if prior to 19 the Offered Securities (as defined below)] to which such Warrants are attached are credited, the account number to be debited for the Warrant Price of each Warrant being exercised (plus accrued interest, if any, on the Warrant Securities to be issued upon exercise of such Warrant from and including the Interest Payment Date (as defined in the Indenture), if any, in respect of such Warrant Securities immediately preceding the Exercise Date to and including the Exercise Date (unless the Exercise Date is after the Regular Record Date (as defined in the Indenture), if any, for such Interest Payment Date, but on or before the immediately succeeding Interest Payment Date for such Warrant Securities, in which event no such accrued interest shall be payable in respect of Warrant Securities to be issued in registered form)), the account number to which the Warrant Securities issued on exercise of the Warrants are to be credited and the form in which Warrant Securities are to be issued. A Warrant Exercise Notice must be received by the Euro-clear Operator or CEDEL prior to [time] (Brussels or Luxembourg time, as the case may be) on the business day next preceding the Exercise Date (as defined in such Warrant Exercise Notice). The delivery to the Euro-clear Operator or CEDEL, as the case may -2- 36 be, of a Warrant Exercise Notice shall constitute an irrevocable election to purchase the aggregate principal amount of Warrant Securities specified therein. Any whole number of Warrants evidenced by this Global Warrant Certificate may be exercised to purchase Warrant Securities in bearer or registered form in denominations of [ or , in the case of Warrant Securities in bearer form, and of and any integral multiple thereof, in the case of Warrant Securities in registered form; provided, however, that no Warrant Security in bearer form shall be mailed or otherwise delivered to any location in the United States of America, its territories or possessions or areas subject to its jurisdiction or the Commonwealth of Puerto Rico (the "United States"). The Warrants evidenced by this Global Warrant Certificate, this Global Warrant Certificate and the rights evidenced hereby may be canceled in the manner and under the circumstances described in the Debt Warrant Agreement. Notice of cancellation of the Warrants evidenced by this Global Warrant Certificate, this Global Warrant Certificate and the rights evidenced hereby shall be given by publication in the manner described in the Debt Warrant Agreement. This Global Warrant Certificate is issued under and in accordance with the Debt Warrant Agreement between the Company and the Warrant Agent and is subject to the terms and provisions contained in the Debt Warrant Agreement, to all of which terms and provisions the holder hereof consents by acceptance hereof. Copies of the Debt Warrant Agreement are on file at the above-mentioned office of the Warrant Agent [and at ]. The Warrant Securities to be issued and delivered upon the exercise of the Warrants evidenced by this Global Warrant Certificate will be issued under and in accordance with an Indenture dated as of ___________ 19__ (the "Indenture") between the Company and The First National Bank of Chicago, as Trustee (the "Trustee"), and will be subject to the terms and provisions contained in the Indenture. Copies of the Indenture and the form of the Warrant Securities are on file at the corporate trust office of the Trustee [and at . [1: The] [2: Prior to 19 the] beneficial ownership of any Warrants evidenced by this Global Warrant Certificate may be transferred only together with the beneficial ownership of the Temporary Global Security (as defined in the Debt Warrant Agreement) evidencing the [Title of Offered Securities] (the "Offered Securities") to which this Global Warrant Certificate was initially attached, and -3- 37 only for the purpose of effecting, or in conjunction with, a transfer of such Temporary Global Security. After such date, the Global Warrant Certificate, and all rights hereunder, may be transferred by delivery, and the Company and the Warrant Agent may treat the holder hereof as the owner for all purposes. This Global Warrant Certificate shall not entitle the Holder hereof to any of the rights of a holder of the Warrant Securities, including, without limitation, the right to receive payments of principal of, premium, if any, or interest, if any, on the Warrant Securities or to enforce any of the covenants of the Indenture. This Global Warrant Certificate shall not be valid or obligatory for any purpose until countersigned by the Warrant Agent. Dated as of , 19 . CHUBB CAPITAL CORPORATION By_____________________________ Attest: ____________________________ Countersigned: ____________________________ As Warrant Agent By__________________________ Authorized Signature -4- 38 Schedule A (additional continuation sheets may be attached if required) Exercises of Warrants The following exercises of a portion of this Global Warrant Certificate or Warrant Securities have been made: -5- 39
Date of Number of Warrants Remaining Number of Notation Exercised for Warrants Following Exercise Warrant Securities such Exercise Made - -------- ------------------ ------------------- -------- By: - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- -------- - -------- ------------------ ------------------- --------
-6- 40 Exhibit C [DELETE THIS EXHIBIT IF WARRANT CERTIFICATES IN ONLY REGISTERED FORM ARE TO BE ISSUED] [FORM OF CERTIFICATE TO BE DELIVERED TO WARRANT AGENT BY THE EURO-CLEAR OPERATOR OR CEDEL] CHUBB CAPITAL CORPORATION Warrants (the "Warrants") to Purchase [Title of Warrant Securities] [Name of Warrant Agent] [Address] Dear Sirs: The undersigned hereby irrevocably elects to exercise __________ Warrants to purchase as of __________ (the "Exercise Date") _____ principal amount of the [title of Warrant Securities] (the "Warrant Securities") of Chubb Capital Corporation and represents that it has tendered payment for such Warrant Securities [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds] to the order of Chubb Capital Corporation, c/o [insert name and address of Warrant Agent], in the amount of _____ in accordance with the terms hereof and the Debt Warrant Agreement dated as of 19 between Chubb Capital Corporation and you (the "Debt Warrant Agreement"). In connection with the Undersigned's request that you deliver to us any Warrant Securities in bearer form, the undersigned hereby certifies that as of the date hereof the Warrant Securities in bearer form which are to be delivered to the Common Depositary referred to below for our account are not being acquired, directly or indirectly, by or on behalf of a United States person (as defined below) or for offer to resell or for resale to a United States person or any person inside the United States (as defined below) or, if a beneficial interest in any such Warrant Securities is being acquired by or on behalf of a United States person, that such 41 United States person is either a financial institution within the meaning of Section 1.165-12(c)(1)(v) of the United States Treasury regulations or is acquiring through such a financial institution and that such Warrant Securities are held by a financial institution that has agreed to comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder and that is not purchasing for offer to resell or for resale inside the United States. As a clearing organization within the meaning of Section 1.163-5(c)(2)(i)(B)(4) of the regulations promulgated under the Internal Revenue Code of 1986, as amended, the undersigned further certifies that (a) the above certification is based solely on statements received from member organizations appearing in our records (our "Account Holders") in certificates in the form set forth in Exhibit D to the Debt Warrant Agreement and (b) as of the date hereof we have not received any notification from any of our Account Holders to the effect that the statements made by such Account Holders in such certificates are no longer true. "United States person" means any citizen, national or resident of the United States, any corporation, partnership or other entity created or organized in or under the laws of the United States or any political subdivision thereof, or any estate or trust the income of which is subject to United States federal income taxation regardless of its source. "United States" means the United States of America, its territories and possessions and areas subject to its jurisdiction and the Commonwealth of Puerto Rico. We hereby undertake to notify you immediately by telex if any of the statements of our Account Holders referred to above is not correct at any time on or before the Warrant Securities in bearer form are delivered. We further agree to cause a confirmation substantially in the form of Exhibit E to the Debt Warrant Agreement and a copy of the prospectus relating to the Warrant Securities delivered to us as contemplated by Section 6.05 of the Debt Warrant Agreement to be delivered to our Account Holders entitled to such Warrant Securities prior to or contemporaneously with our transfer of such Warrant Securities to or to the account of such Account Holders. We understand that this certificate is required in connection with United States laws, tax laws and regulations. We irrevocably authorize you to produce this Certificate or a copy hereof to any interested party in any administrative or legal proceedings with respect to the matters covered by this Certificate. -2- 42 The undersigned requests that said principal amount of Warrant Securities be [in registered form in the authorized denominations, registered in such names and delivered all as specified in accordance with the instructions set forth below] [bearer form in the authorized denominations and delivered to as Common Depositary under the Debt Warrant Agreement, to be held for our account]** [Instructions as to delivery of Warrant Securities to be issued in registered form]. Dated: ______________, 19__ Very truly yours, [MORGAN GUARANTY TRUST COMPANY OF NEW YORK, Brussels Office, as operator of the Euro-clear System]* By__________________________ Title: [CENTRALE DE LIVRAISONS DE VALEURS MOBILIERES S.A.]* By__________________________ Title: __________________________________ ** Delete inapplicable reference. -3- 43 Exhibit D [DELETE THIS EXHIBIT IF WARRANT CERTIFICATES IN ONLY REGISTERED FORM ARE TO BE ISSUED] [FORM OF WARRANT EXERCISE NOTICE] [Morgan Guaranty Trust Company of New York, Brussels Office, as operator of the Euro-clear System (the "Euro-clear Operator") ***] [Address] Centrale de Livraison de Valeurs Mobilieres S.A.* [Address] CHUBB CAPITAL CORPORATION WARRANTS (THE "WARRANTS") TO PURCHASE [Title of Warrant Securities] (the "Warrant Securities") Dear Sirs: We hereby irrevocably elect to exercise __________ Warrants to purchase _________ (being _______________ or an integral multiple thereof) aggregate principal amount of Warrant Securities of Chubb Capital Corporation (the "Company") on ____________, 19 __ (the "Exercise Date"). The account number(s) on your books in which the Warrants being exercised [and the [Title of Offered Securities] to which such Warrants are attached]**** are held is (are) ________________________. The Warrant Securities to be issued to us on exercise of the Warrants are to be credited to such account, unless otherwise indicated below and shall be in [registered] [bearer]* form in the following authorized denominations: _______________________. ________________________ *** Delete inapplicable reference. **** Delete if dated on or after 19 . 44 We hereby request that you complete a certification in the form required by the Debt Warrant Agreement hereinafter referred to and make payment directly to [ ], as Warrant Agent (the "Warrant Agent", which term shall include its successors as such Warrant Agent), under the Debt Warrant Agreement dated as of [ ] between the Company and the Warrant Agent (the "Debt Warrant Agreement") at or prior to [time] on the Exercise Date, or if the Exercise Date is the last day on which Warrants may be exercised under the Debt Warrant Agreement, prior to [time] in [location] on the Exercise Date, [in lawful money of the United States of America] [in applicable currency] [in cash] [by certified check or official bank check or by bank wire transfer, in each case,] [by bank wire transfer] [in immediately available funds] of ____________, such amount being the Warrant Price (as defined in the Global Warrant Certificate representing the Warrants, as provided in Section 1.02 of the Debt Warrant Agreement) for Warrants exercised (plus any accrued interest as specified in such Global Warrant Certificate) on the Exercise Date, and debit account number ___________ for said amount. The undersigned hereby certifies that as of the date hereof, the Warrant Securities which are to be delivered in bearer form are not being acquired, directly or indirectly, by or on behalf of a United States person or for offer to resell or for resale to a United States person or any person inside the United States (as defined below) or, if a beneficial interest in such Warrant Securities is being acquired by or on behalf of a United States person, that such United States person is either a financial institution within the meaning of Section 1.165-12(c)(1)(v) of the United States Treasury regulations or is acquiring such beneficial interest through such financial institution and that such beneficial interest is held by a financial institution which agrees to comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder and which is not purchasing for offer to resell or for resale inside the United States. If the undersigned is a dealer, the undersigned agrees to obtain a similar certificate from each person entitled to delivery of any Warrant Securities in bearer form purchased from it; provided, however, that if the undersigned has actual knowledge that the information contained in such a certificate is false, the undersigned will not deliver a Warrant Security in temporary or definitive bearer form to the person who signed such certificate notwithstanding the delivery of such certificate to the undersigned. The undersigned will be deemed to have actual knowledge if, inter alia, the undersigned has a United States address for the beneficial owner of such Warrant Security (other than a financial institution as defined in -2- 45 Section 1.165-12(c)(1)(v) that represents that it will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and the regulations thereunder), unless the undersigned has documentary evidence (as described in A-5 of Section 35a.9999-4T of the regulations promulgated under the Internal Revenue Code of 1986, as amended) that the beneficial owner of such Warrant Security is not a United States person. If this certificate is being provided by a clearing organization, it is based on statements provided to it by its member organizations. As used herein, a "clearing organization" is an entity which is in the business of holding obligations for member organizations and transferring obligations among such members by credit or debit to the account of a member without the necessity of physical delivery of the obligation. We undertake to advise you immediately by telex if the foregoing statement as to beneficial ownership is not correct on or before the date of delivery of such Warrant Securities as to the entire principal amount of the Warrant Securities to be issuable upon exercise [then appearing on your books as being held for our account]. We understand that this certificate is required in connection with certain tax regulations in the United States. If administrative or legal proceedings are commenced or threatened in connection with which this certificate is or would be relevant, we irrevocably authorize you to produce this certificate or a copy thereof to any interested party in such proceedings. "United States person" means any citizen, national or resident of the United States or any political subdivision thereof, any corporation, partnership or other entity created or organized in or under laws of the United States, or any estate or trust the income of which is subject to United States federal income taxation regardless of its source. "United States" means the United States of America, its territories and possessions and areas subject to its jurisdiction and the Commonwealth of Puerto Rico. Dated: ____________, 19__ Very truly yours, [Name and, if appropriate, title] As the beneficial owner(s) of the interest in the Warrants to which this Warrant Exercise Notice relates. -3- 46 By ____________________________ Title: -4- 47 Exhibit E [DELETE THIS EXHIBIT IF WARRANT CERTIFICATES IN ONLY REGISTERED FORM ARE TO BE ISSUED] [FORM OF CONFIRMATION TO BE DELIVERED TO PURCHASERS OF WARRANT SECURITIES IN BEARER FORM] CHUBB CAPITAL CORPORATION [Title of Warrant Securities] (the "Warrant Securities") By your purchase of Warrant Securities in bearer form you represent that you are not a United States person or, if you are a United States person, that you are a financial institution as defined in Section 1.165-12(c)(1)(v) of the Treasury Department regulations, purchasing for your own account or for the account of a customer and that you will comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended from time to time, and the regulations thereunder. Furthermore, if you are a dealer, you agree that you will deliver a confirmation containing this entire paragraph to purchasers of such Securities from you. For purposes of this statement, "United States person" means any citizen, national or resident of the United States, any corporation, partnership or other entity created or organized in or under the laws of the United States or any political subdivision thereof or any estate or trust the income of which is subject to United States federal income taxation regardless of its source, and "United States" means the United States of America, its territories and possessions and areas subject to its jurisdiction and the Commonwealth of Puerto Rico. EX-5.1 12 OPINION OF DAVIS POLK & WARDWELL 1 Exhibit 5.1 [LETTERHEAD OF DAVIS POLK & WARDWELL] May 5, 1995 The Chubb Corporation 15 Mountain View Road P.O. Box 1615 Warren, New Jersey 07061-1615 Chubb Capital Corporation c/o The Chubb Corporation 15 Mountain View Road P.O. Box 1615 Warren, New Jersey 07061-1615 Re: The Chubb Corporation; Chubb Capital Corporation-- Registration Statement on Form S-3 Dear Sirs: We are acting as counsel for The Chubb Corporation, a New Jersey corporation (the "Corporation") and Chubb Capital Corporation, a New Jersey corporation ("Capital"), in connection with the Registration Statement on Form S-3 (the "Registration Statement") filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the "Act"), for the registration of (a) securities of each class as described therein with an aggregate offering price of $400,000,000 to be issued from time to time by either the Corporation or Capital, as the case may be: (i) senior debt securities (the "Senior Debt Securities") to be issued by the Corporation under an indenture dated as of October 25, 1989, between the Corporation and The First National Bank of Chicago, as trustee (the "Senior Indenture"); (ii) subordinated debt 2 The Chubb Corporation 2 May 5, 1995 Chubb Capital Corporation securities (the "Subordinated Debt Securities" and together with the Senior Debt Securities, the "Debt Securities") to be issued by the Corporation under an indenture to be executed by the Corporation and the First National Bank of Chicago, as trustee (the "Subordinated Indenture); (iii) guaranteed senior debt securities (the "Guaranteed Senior Debt Securities") to be issued by Capital under an indenture dated as of October 25, 1989, between Capital, the Corporation as guarantor, and The First National Bank of Chicago, as Trustee (the "Senior Capital Indenture"); (iv) guaranteed subordinated debt securities (the "Guaranteed Subordinated Debt Securities" and together with the Guaranteed Senior Debt Securities, the "Guaranteed Debt Securities") to be issued by Capital under an indenture to be executed by Capital, the Corporation as guarantor, and The First National Bank of Chicago, as trustee (the "Subordinated Capital Indenture"); (v) common stock of the Corporation (the "Common Stock"); (vi) preferred stock of the Corporation (the "Preferred Stock"); (vii) preferred stock depositary shares (the "Depositary Shares") to be issued under a deposit agreement to be entered into between the Corporation, a depositary and holders of depositary receipts (the "Deposit Agreement"); (viii) debt warrants to be issued by the Corporation (the "Corporation Debt Warrants") under a debt warrant agreement to be entered into between the Corporation and a debt warrant agent (the "Corporation Debt Warrant Agreement"); (ix) debt warrants to be issued by Capital (the "Capital Debt Warrants" and together with the Corporation Debt Warrants, the "Debt Warrants") to be issued by Capital under a debt warrant agreement to be entered into between Capital and a debt warrant agent (the "Capital Debt Warrant Agreement"); and (x) stock warrants to be issued by the Corporation (the "Stock Warrants" and together with the Debt Warrants, the "Warrants") under a stock warrant agreement to be entered into between the Corporation and a stock warrant agent (the "Stock Warrant Agreement") and (b) the guarantees by the Corporation of the payment of principal of and premium, if any, and interest on each of the Guaranteed Senior Debt Securities (the "Senior Guarantees") and the Guaranteed Subordinated Debt Securities (the "Subordinated Guarantees"). We have examined originals or copies, certified or otherwise identified to our satisfaction, of such documents, 3 The Chubb Corporation 3 May 5, 1995 Chubb Capital Corporation corporate records, certificates of public officials and other instruments as we have deemed necessary or advisable for purposes of this opinion. Based upon the foregoing, we are of the opinion that each of the Corporation and Capital is a corporation duly organized and validly existing under the laws of the State of New Jersey. Based upon the foregoing, we are of the further opinion that when the Registration Statement has become effective under the Act, then: (1) When the Subordinated Indenture or the Subordinated Capital Indenture, as the case may be, if applicable has been duly authorized and executed by the parties thereto, the Debt Securities and, if applicable, the Senior Guarantees or Subordinated Guarantees, as the case may be, when issued in accordance with the terms of the relevant Indenture will be valid and binding obligations of the Corporation or Capital, as the case may be. (2) When the issuance of any shares of Common Stock or Preferred Stock has been duly authorized under New Jersey law and such shares are issued, such shares will be validly issued, fully-paid and nonassessable. (3) When any Warrant Agreement has been duly authorized and executed by the parties thereto, any Warrants when issued in accordance with the terms of the relevant Warrant Agreement will be valid and binding obligations of the Corporation or Capital, as the case may be. (4) When the Deposit Agreement has been duly authorized and executed by the parties thereto, and Preferred Stock has been deposited thereunder, any Depositary Shares when issued in accordance with the terms thereof will be valid and binding instruments in accordance with their terms and the terms of the Deposit Agreement. In rendering the foregoing opinion, we have relied upon the opinion to you of even date herewith of 4 The Chubb Corporation 4 May 5, 1995 Chubb Capital Corporation Shanley & Fisher, P.C., included as Exhibit 5(b) to the Registration Statement, as to all matters governed by New Jersey law. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement. We also consent to the reference to us under the caption "Legal Opinions" in the Prospectus contained in the Registration Statement. Very truly yours, /s/ Davis Polk & Wardwell EX-5.2 13 OPINION OF SHANLEY & FISHER, P.C. 1 Exhibit 5.2 [LETTERHEAD OF SHANLEY & FISHER] May 5, 1995 The Chubb Corporation 15 Mountain View Road P.O. Box 1615 Warren, New Jersey 07061-1615 Chubb Capital Corporation c/o The Chubb Corporation 15 Mountain View Road P.O. Box 1615 Warren, New Jersey 07061-1615 Davis Polk & Wardwell 450 Lexington Avenue New York, New York 10017 Re: The Chubb Corporation; Chubb Capital Corporation-- Registration Statement on Form S-3 Dear Sirs: We are acting as New Jersey counsel for The Chubb Corporation, a New Jersey corporation (the "Corporation"), and Chubb Capital Corporation, a New Jersey corporation ("Capital"), in connection with the Registration Statement on Form S-3 (the "Registration Statement") filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the "Act"), for the registration of (a) securities of each class as described therein with an aggregate offering price of $400,000,000 to be issued from time to time by either the Corporation or Capital, as the case may be consisiting of: (i) senior debt securities (the "Senior Debt 2 The Chubb Corporation 2 May 5, 1995 Chubb Capital Corporation Davis Polk & Wardwell Securities") to be issued by the Corporation under an indenture dated as of October 25, 1989, between the Corporation and The First National Bank of Chicago, as trustee (the "Senior Indenture"); (ii) subordinated debt securities (the "Subordinated Debt Securities" and together with the Senior Debt Securities, the "Debt Securities") to be issued by the Corporation under an indenture to be executed by the Corporation and the First National Bank of Chicago, as trustee (the "Subordinated Indenture); (iii) guaranteed senior debt securities (the "Guaranteed Senior Debt Securities") to be issued by Capital under an indenture dated as of October 25, 1989, between Capital, the Corporation, as guarantor, and The First National Bank of Chicago, as trustee (the "Senior Capital Indenture"); (iv) guaranteed subordinated debt securities (the "Guaranteed Subordinated Debt Securities" and together with the Guaranteed Senior Debt Securities, the "Guaranteed Debt Securities") to be issued by Capital under an indenture to be executed by Capital, the Corporation, as guarantor, and The First National Bank of Chicago, as trustee (the "Subordinated Capital Indenture"); (v) common stock of the Corporation (the "Common Stock"); (vi) preferred stock of the Corporation (the "Preferred Stock"); (vii) preferred stock depositary shares (the "Depositary Shares") to be issued by the Corporation under a deposit agreement to be entered into between the Corporation, a depositary and holders of depositary receipts (the "Deposit Agreement"); (viii) debt warrants to be issued by the Corporation (the "Corporation Debt Warrants") under a debt warrant agreement to be entered into between the Corporation and a debt warrant agent (the "Corporation Debt Warrant Agreement"); (ix) debt warrants to be issued by Capital (the "Capital Debt Warrants" and together with the Corporation Debt Warrants, the "Debt Warrants") to be issued by Capital under a debt warrant agreement to be entered into between Capital and a debt warrant agent (the "Capital Debt Warrant Agreement"); and (x) stock warrants to be issued by the Corporation (the "Stock Warrants" and together with the Debt Warrants, the "Warrants") under a stock warrant agreement to be entered into between the Corporation and a stock warrant agent (the "Stock Warrant Agreement") and (b) the guarantees by the Corporation of the payment of principal of and premium, if any, and interest on each of the Guaranteed Senior Debt Securities (the "Senior Guarantees") and the 3 The Chubb Corporation 3 May 5, 1995 Chubb Capital Corporation Davis Polk & Wardwell Guaranteed Subordinated Debt Securities (the "Subordinated Guarantees"). We have examined originals or copies, certified or otherwise identified to our satisfaction, of such documents, corporate records, certificates of public officials and other instruments as we have deemed necessary or advisable for purposes of this opinion. Based upon the foregoing, we are of the opinion that each of the Corporation and Capital is a corporation duly organized and validly existing under the laws of the State of New Jersey. Based upon the foregoing, we are of the further opinion that when the Registration Statement has become effective under the Act, then: (1) When the Subordinated Indenture or the Subordinated Capital Indenture, as the case may be, if applicable, has been duly authorized and executed by the parties thereto, the Debt Securities and, if applicable, the Senior Guarantees or Subordinated Guarantees, as the case may be, when issued in accordance with the terms of the relevant Indenture will be valid and binding obligations of the Corporation or Capital, as the case may be. (2) When the issuance of any shares of Common Stock or Preferred Stock has been duly authorized under New Jersey law and such shares are issued, such shares will be validly issued, fully-paid and nonassessable. (3) When any Warrant Agreement has been duly authorized and executed by the parties thereto, any Warrants when issued in accordance with the terms of the relevant Warrant Agreement will be valid and binding obligations of the Corporation or Capital, as the case may be. (4) When the Deposit Agreement has been duly authorized and executed by the parties thereto, and Preferred Stock has been deposited thereunder, any Depositary Shares when issued in accordance with the terms thereof will be valid and binding instruments in 4 The Chubb Corporation 4 May 5, 1995 Chubb Capital Corporation Davis Polk & Wardwell accordance with their terms and the terms of the Deposit Agreement. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement. We also consent to the reference to us under the caption "Legal Opinions" in the Prospectus contained in the Registration Statement. Very truly yours, /s/ Shanley & Fisher, P.C. EX-12 14 COMPUTATION OF CONSOLIDATED RATIO OF EARNINGS 1 THE CHUBB CORPORATION EXHIBIT 12 COMPUTATION OF RATIO OF CONSOLIDATED EARNINGS TO FIXED CHARGES (IN THOUSANDS) YEARS ENDED DECEMBER 31, 1994, 1993, 1992, 1991 AND 1990
1994 1993 1992 1991 1990 ---- ---- ---- ---- ---- Income before provision for income taxes and cummulative effect of changes in accounting principles............................................ $639,364 $344,492 $748,441 $683,676 $645,743 Add Interest expensed............................... 79,278 64,221 54,540 44,542 44,907 Capitalized interest amortized or expensed...... 1,738 1,727 898 1,032 4,820 Portion of rents representative of the interest factor............................... 28,637 29,863 30,025 28,076 24,657 -------- -------- -------- -------- -------- Income as adjusted...................... $749,017 $440,303 $833,904 $757,326 $720,127 ======== ======== ======== ======== ======== Fixed charges: Interest expensed............................... 79,278 64,221 $ 54,540 44,542 44,907 Capitalized interest............................ 19,407 28,685 40,284 46,369 43,672 Portion of rents representative of the interest factor....................................... 28,637 29,863 30,025 28,076 24,657 -------- -------- -------- -------- -------- Fixed charges .......................... $127,322 $122,769 $124,849 $118,987 $113,236 ======== ======== ======== ======== ======== Ratio of consolidated earnings to fixed charges......... 5.88 3.59 6.68 6.36 6.36 ======== ======== ======== ======== ========
EX-23.1 15 CONSENT OF ERNST & YOUNG 1 EXHIBIT 23.1 CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" in the Registration Statement on Form S-3 and related Prospectus of The Chubb Corporation and Chubb Capital Corporation for the registration of $400,000,000 of debt securities, guaranteed debt securities, common stock, preferred stock, depositary shares and warrants and to the incorporation by reference therein of our report dated February 24, 1995, with respect to the consolidated financial statements of The Chubb Corporation incorporated by reference in its Annual Report (Form 10-K) and our report dated March 27, 1995 with respect to the financial statement schedules included in its Annual Report (Form 10-K) for the year ended December 31, 1994, filed with the Securities and Exchange Commission. /s/ Ernst & Young LLP ERNST & YOUNG LLP New York, New York May 3, 1995 EX-24.1 16 POWER OF ATTORNEY FOR THE DIRECTORS OF CHUBB 1 EXHIBIT 24.1 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. 2/15/95 /s/ Dean R. O'Hare - -------------------------- ------------------------------------ (Date) (Signature) Dean R. O'Hare ------------------------------------ (Please Print or Type Name) 2 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. 2/16/95 /s/ Percy Chubb, III - -------------------------- ------------------------------------ (Date) (Signature) Percy Chubb, III ------------------------------------ (Please Print or Type Name) 3 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. 2/21/95 /s/ John C. Beck - -------------------------- ------------------------------------ (Date) (Signature) John C. Beck ------------------------------------ (Please Print or Type Name) 4 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. February 27, 1995 /s/ Joel J. Cohen - -------------------------- ------------------------------------ (Date) (Signature) Joel J. Cohen ------------------------------------ (Please Print or Type Name) 5 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. 2/19/95 /s/ Henry U. Harder - -------------------------- ------------------------------------ (Date) (Signature) Henry U. Harder ------------------------------------ (Please Print or Type Name) 6 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. February 24, 1995 /s/ David H. Hoag - -------------------------- ------------------------------------ (Date) (Signature) David H. Hoag ------------------------------------ (Please Print or Type Name) 7 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. February 27, 1995 /s/ Robert V. Lindsay - -------------------------- ------------------------------------ (Date) (Signature) Robert V. Lindsay ------------------------------------ (Please Print or Type Name) 8 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. 2/21/95 /s/ Thomas C. MacAvoy - -------------------------- ------------------------------------ (Date) (Signature) Thomas C. MacAvoy ------------------------------------ (Please Print or Type Name) 9 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. Feb. 17, 1995 /s/ Gertrude G. Michelson - -------------------------- ------------------------------------ (Date) (Signature) Gertrude G. Michelson ------------------------------------ (Please Print or Type Name) 10 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. 2/22/95 /s/ Warren B. Rudman - -------------------------- ------------------------------------ (Date) (Signature) Warren B. Rudman ------------------------------------ (Please Print or Type Name) 11 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. 23 February 1995 /s/ David G. Scholey - -------------------------- ------------------------------------ (Date) (Signature) David G. Scholey ------------------------------------ (Please Print or Type Name) 12 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. Feb. 28, 1995 /s/ R.G.H. Seitz - -------------------------- ------------------------------------ (Date) (Signature) R.G.H. Seitz ------------------------------------ (Please Print or Type Name) 13 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. 2/21/95 /s/ Lawrence M. Small - -------------------------- ------------------------------------ (Date) (Signature) Lawrence M. Small ------------------------------------ (Please Print or Type Name) 14 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. February 22, 1995 /s/ Richard D. Wood - -------------------------- ------------------------------------ (Date) (Signature) Richard D. Wood ------------------------------------ (Please Print or Type Name) 15 POWER OF ATTORNEY I, the undersigned, hereby constitute and appoint Henry G. Gulick, Dean R. O'Hare and Philip J. Sempier, each of them with full power to act without the others, my true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for me and in my name, place and stead, in any and all capacities to sign (i) a Form 10-K Annual Report of The Chubb Corporation for its fiscal year ended December 31, 1994 pursuant to the requirement of the Securities Exchange Act of 1934, and (ii) registration statements, amendments and post-effective amendments to registration statements including but not limited to registration statements, amendments and post-effective amendments to registration statements on Form S-8 and Form S-3 under the Securities Act of 1933 and to file the same, or cause the same to be filed, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission. I further grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in the exercise of the powers herein granted, as fully as I could do if personally present, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or any of their substitutes, may lawfully do or cause to be done by the powers herein granted. February 28, 1995 /s/ Henry B. Schram - -------------------------- ------------------------------------ (Date) (Signature) Henry B. Schram ------------------------------------ (Please Print or Type Name) EX-24.2 17 POWERS OF ATTORNEY FOR THE DIRECTORS OF CAPITAL 1 Exhibit 24.2 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each officer or director of Chubb Capital Corporation (the "Company") whose signature appears below constitutes and appoints Henry G. Gulick, Dean R. O'Hare or Robert Rusis, and each of them, with full power to act without the other, his true and lawful attorney-in-fact and agent, with full and several power of substitution, for him and in his name, place and stead, in any and all capacities, to sign the Company's Registration Statement on Form S-3 relating to the proposed public offering of the debt securities of the Company and warrants of the Company for the purchase of its debt securities or for the purchase of securities of The Chubb Corporation and to sign any or all amendments, including post-effective amendments, and supplements thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto same attorneys-in-fact and agents and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as they or he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. /s/ Dean R. O'Hare -------------------------------- (Name) Dated 4/25 , 1995 ----------- 2 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each officer or director of Chubb Capital Corporation (the "Company") whose signature appears below constitutes and appoints Henry G. Gulick, Dean R. O'Hare or Robert Rusis, and each of them, with full power to act without the other, his true and lawful attorney-in-fact and agent, with full and several power of substitution, for him and in his name, place and stead, in any and all capacities, to sign the Company's Registration Statement on Form S-3 relating to the proposed public offering of the debt securities of the Company and warrants of the Company for the purchase of its debt securities or for the purchase of securities of The Chubb Corporation and to sign any or all amendments, including post-effective amendments, and supplements thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto same attorneys-in-fact and agents and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as they or he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. /s/ Eric H. Grosseibl -------------------------------- (Name) Dated April 28, 1995 --------- 3 POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each officer or director of Chubb Capital Corporation (the "Company") whose signature appears below constitutes and appoints Henry G. Gulick, Dean R. O'Hare or Robert Rusis, and each of them, with full power to act without the other, his true and lawful attorney-in-fact and agent, with full and several power of substitution, for him and in his name, place and stead, in any and all capacities, to sign the Company's Registration Statement on Form S-3 relating to the proposed public offering of the debt securities of the Company and warrants of the Company for the purchase of its debt securities or for the purchase of securities of The Chubb Corporation and to sign any or all amendments, including post-effective amendments, and supplements thereto, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto same attorneys-in-fact and agents and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as they or he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. /s/ Philip J. Sempier -------------------------------- (Name) Dated April 25, 1995 --------- EX-25.1 18 T-1 - CHUBB 1 EXHIBIT 25.1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____ _________________________________ THE FIRST NATIONAL BANK OF CHICAGO (EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER) A NATIONAL BANKING ASSOCIATION 36-0899825 (I.R.S. EMPLOYER IDENTIFICATION NUMBER) ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) THE FIRST NATIONAL BANK OF CHICAGO ONE FIRST NATIONAL PLAZA, SUITE 0286 CHICAGO, ILLINOIS 60670-0286 ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919 (NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE) ___________________________________ THE CHUBB CORPORATION (EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER) NEW JERSEY 13-2595722 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER) 15 MOUNTAIN VIEW ROAD P.O. BOX 1615 WARREN, NEW JERSEY 07061-1615 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) SUBORDINATED DEBT SECURITIES (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. Comptroller of Currency, Washington, D.C., Federal Deposit Insurance Corporation, Washington, D.C., The Board of Governors of the Federal Reserve System, Washington D.C. (B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS. The trustee is authorized to exercise corporate trust powers. ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION. No such affiliation exists with the trustee. ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A PART OF THIS STATEMENT OF ELIGIBILITY. 1. A copy of the articles of association of the trustee now in effect.* 2. A copy of the certificates of authority of the trustee to commence business.* 3. A copy of the authorization of the trustee to exercise corporate trust powers.* 4. A copy of the existing by-laws of the trustee.* 5. Not Applicable. 6. The consent of the trustee required by Section 321(b) of the Act. 2 3 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. 8. Not Applicable. 9. Not Applicable. Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the trustee, The First National Bank of Chicago, a national banking association organized and existing under the laws of the United States of America, has duly caused this Statement of Eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of Chicago and State of Illinois, on the 25th day of April, 1995. THE FIRST NATIONAL BANK OF CHICAGO, TRUSTEE, BY /S/ JOHN R. PRENDIVILLE -------------------------- JOHN R. PRENDIVILLE VICE PRESIDENT *Exhibits 1, 2, 3, and 4 are herein incorporated by reference to Exhibits bearing identical numbers in Item 12 of the Form T-1 of The First National Bank of Chicago, filed as Exhibit 26(b) to the Registration Statement on Form S-3 of Dow Capital B.V. and The Dow Chemical Company, filed with the Securities and Exchange Commission on June 3, 1991 (Registration No. 33-36314). 3 4 EXHIBIT 6 THE CONSENT OF THE TRUSTEE REQUIRED BY SECTION 321(b) OF THE ACT April 25, 1995 Securities and Exchange Commission Washington, D.C. 20549 Gentlemen: In connection with the qualification of an indenture between The Chubb Corporation and The First National Bank of Chicago, the undersigned, in accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby consents that the reports of examinations of the undersigned, made by Federal or State authorities authorized to make such examinations, may be furnished by such authorities to the Securities and Exchange Commission upon its request therefor. Very truly yours, THE FIRST NATIONAL BANK OF CHICAGO BY: /S/ JOHN R. PRENDIVILLE -------------------------- JOHN R. PRENDIVILLE VICE PRESIDENT 4 5 EXHIBIT 7 A copy of the latest report of conditions of the trustee published pursuant to law or the requirements of its supervising or examining authority. 5 6 Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/94 ST-BK: 17-1630 FFIEC 031 Address: One First National Plaza, Suite 0460 Page RC-1 City, State Zip: Chicago, IL 60670-0460 FDIC Certificate No.: 0/3/6/1/8
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL AND STATE-CHARTERED SAVINGS BANKS FOR DECEMBER 31, 1994 All schedules are to be reported in thousands of dollars. Unless otherwise indicated, report the amount outstanding of the last business day of the quarter. SCHEDULE RC--BALANCE SHEET
C400 <- DOLLAR AMOUNTS IN ------------ ----- THOUSANDS RCFD BIL MIL THOU ----------------- ---- ------------ ASSETS 1. Cash and balances due from depository institutions (from Schedule RC-A): a. Noninterest-bearing balances and currency and coin(1) . . . . 0081 3,776.149 1.a. b. Interest-bearing balances(2) . . . . . . . . . . . . . . . . . 0071 7,670,634 1.b. 2. Securities a. Held-to-maturity securities (from Schedule RC-B, column A) . . 1754 163,225 2.a. b. Available-for-sale securities (from Schedule RC-B, column D) . 1773 533,857 2.b. 3. Federal funds sold and securities purchased under agreements to resell in domestic offices of the bank and its Edge and Agreement subsidiaries, and in IBFs: a. Federal Funds sold . . . . . . . . . . . . . . . . . . . . . . 0276 4,037,205 3.a. b. Securities purchased under agreements to resell . . . . . . . 0277 423,381 3.b. 4. Loans and lease financing receivables: a. Loans and leases, net of unearned income (from Schedule RC-C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 2122 15,617,618 4.a. b. LESS: Allowance for loan and lease losses . . . . . . . . . . RCFD 3123 351,191 4.b. c. LESS: Allocated transfer risk reserve . . . . . . . . . . . . RCFD 3128 0 4.c. d. Loans and leases, net of unearned income, allowance, and reserve (item 4.a minus 4.b and 4.c) . . . . . . . . . . . . . . 2125 15,266,427 4.d. 5. Assets held in trading accounts . . . . . . . . . . . . . . . . . 3545 8,227,304 5. 6. Premises and fixed assets (including capitalized leases) . . . . 2145 512,222 6. 7. Other real estate owned (from Schedule RC-M) . . . . . . . . . . 2150 46,996 7. 8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M) . . . . . . . . . . . . . . . . . 2130 7,571 8. 9. Customers' liability to this bank on acceptances outstanding . . 2155 507,151 9. 10. Intangible assets (from Schedule RC-M) . . . . . . . . . . . . . 2143 120,504 10. 11. Other assets (from Schedule RC-F) . . . . . . . . . . . . . . . . 2160 1,250,306 11. 12. Total assets (sum of items 1 through 11) . . . . . . . . . . . . 2170 42,542,932 12.
__________________ (1) Includes cash items in process of collection and unposted debits. (2) Includes time certificates of deposit not held in trading accounts. 6 7 Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/94 ST-BK: 17-1630 FFIEC 031 Address: One First National Plaza, Suite 0460 Page RC-2 City, State Zip: Chicago, IL 60670-0460 FDIC Certificate No.: 0/3/6/1/8
SCHEDULE RC-CONTINUED
DOLLAR AMOUNTS IN THOUSANDS BIL MIL THOU ----------------- ------------ LIABILITIES 13. Deposits: a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part 1) . . . . . . . . . . . . . . . RCON 2200 15,103,504 13.a. (1) Noninterest-bearing(1) . . . . . . . . . . . . . . . . RCON 6631 6,129,078 13.a.(1) (2) Interest-bearing . . . . . . . . . . . . . . . . . . . RCON 6636 8,974,426 13.a.(2) b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E, part II) . . . . . . . . . . . . RCFN 2200 10,633,999 13.b. (1) Noninterest bearing . . . . . . . . . . . . . . . . . RCFN 6631 460,916 13.b.(1) (2) Interest-bearing . . . . . . . . . . . . . . . . . . RCFN 6636 10,173,083 13.b.(2) 14. 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: a. Federal funds purchased . . . . . . . . . . . . . . . . . RCFD 0278 2,883,499 14.a. b. Securities sold under agreements to repurchase . . . . . . RCFD 0279 502,401 14.b. 15. a. Demand notes issued to the U.S. Treasury . . . . . . . . . RCON 2840 112,289 15.a. b. Trading Liabilities . . . . . . . . . . . . . . . . . . . RCFD 3548 4,798,720 15.b. 16. Other borrowed money: a. With original maturity of one year or less . . . . . . . . RCFD 2332 2,355,421 16.a. b. With original maturity of more than one year . . . . . . RCFD 2333 382,801 16.b. 17. Mortgage indebtedness and obligations under capitalized leases . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 2910 275,794 17. 18. Bank's liability on acceptance executed and outstanding RCFD 2920 507,151 18. 19. Subordinated notes and debentures . . . . . . . . . . . . . . RCFD 3200 1,225,000 19. 20. Other liabilities (from Schedule RC-G) . . . . . . . . . . . RCFD 2930 860,989 20. 21. Total liabilities (sum of items 13 through 20) . . . . . . . RCFD 2948 39,641,568 21. 22. Limited-Life preferred stock and related surplus . . . . . . RCFD 3282 0 22. EQUITY CAPITAL 23. Perpetual preferred stock and related surplus . . . . . . . . RCFD 3838 0 23. 24. Common stock . . . . . . . . . . . . . . . . . . . . . . . . RCFD 3230 200,858 24. 25. Surplus (exclude all surplus related to preferred stock) RCFD 3839 2,273,657 25. 26. a. Undivided profits and capital reserves . . . . . . . . . . RCFD 3632 431,545 26.a. b. Net unrealized holding gains (losses) on available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . RCFD 8434 [ 4,184) 26.b. 27. Cumulative foreign currency translation adjustments . . . . . RCFD 3284 (512) 27. 28. Total equity capital (sum of items 23 through 27) . . . . . . RCFD 3210 2,901,364 28. 29. Total liabilities, limited-life preferred stock, and equity capital (sum of items 21, 22, and 28) . . . . . . . . . . . . RCFD 3300 42,542,932 29.
Memorandum To be reported only with the March Report of Condition. 1. Indicate in the box at the right the number of the statement below that Number best describes the most comprehensive level of auditing work performed for -------------- the bank by independent external auditors as of any date during 1993 . . . . . . . . . . . RCFD 6724 N/A M.1. --------------
1 = Independent audit of the bank conducted in accordance 4.= Directors' examination of the bank performed by other with generally accepted auditing standards by a certified external auditors (may be required by state chartering public accounting firm which submits a report on the bank authority) 2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external conducted in accordance with generally accepted auditing auditors standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external submits a report on the consolidated holding company auditors (but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work) 3 = Directors' examination of the bank conducted in 8 = No external audit work accordance with generally accepted auditing standards by a certified public accounting firm (may be required by state chartering authority)
___________________ (1) Includes total demand deposits and noninterest-bearing time and savings deposits. 7 EX-25.2 19 T-1 - CAPITAL 1 Exhibit 25.2 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) _____ _________________________________ THE FIRST NATIONAL BANK OF CHICAGO (EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER) A NATIONAL BANKING ASSOCIATION 36-0899825 (I.R.S. EMPLOYER IDENTIFICATION NUMBER) ONE FIRST NATIONAL PLAZA, CHICAGO, ILLINOIS 60670-0126 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) THE FIRST NATIONAL BANK OF CHICAGO ONE FIRST NATIONAL PLAZA, SUITE 0286 CHICAGO, ILLINOIS 60670-0286 ATTN: LYNN A. GOLDSTEIN, LAW DEPARTMENT (312) 732-6919 (NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE) ___________________________________ CHUBB CAPITAL CORPORATION (EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER) NEW JERSEY 13-3339467 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER) 15 MOUNTAIN VIEW ROAD P.O. BOX 1615 WARREN, NEW JERSEY 07061-1615 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) SUBORDINATED DEBT SECURITIES (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. Comptroller of Currency, Washington, D.C., Federal Deposit Insurance Corporation, Washington, D.C., The Board of Governors of the Federal Reserve System, Washington D.C. (B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS. The trustee is authorized to exercise corporate trust powers. ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION. No such affiliation exists with the trustee. ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A PART OF THIS STATEMENT OF ELIGIBILITY. 1. A copy of the articles of association of the trustee now in effect.* 2. A copy of the certificates of authority of the trustee to commence business.* 3. A copy of the authorization of the trustee to exercise corporate trust powers.* 4. A copy of the existing by-laws of the trustee.* 5. Not Applicable. 6. The consent of the trustee required by Section 321(b) of the Act. 2 3 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. 8. Not Applicable. 9. Not Applicable. Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the trustee, The First National Bank of Chicago, a national banking association organized and existing under the laws of the United States of America, has duly caused this Statement of Eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of Chicago and State of Illinois, on the 25th day of April, 1995. THE FIRST NATIONAL BANK OF CHICAGO, TRUSTEE, BY /s/ JOHN R. PRENDIVILLE -------------------------- JOHN R. PRENDIVILLE VICE PRESIDENT *Exhibits 1, 2, 3, and 4 are herein incorporated by reference to Exhibits bearing identical numbers in Item 12 of the Form T-1 of The First National Bank of Chicago, filed as Exhibit 26(b) to the Registration Statement on Form S-3 of Dow Capital B.V. and The Dow Chemical Company, filed with the Securities and Exchange Commission on June 3, 1991 (Registration No. 33-36314). 3 4 EXHIBIT 6 THE CONSENT OF THE TRUSTEE REQUIRED BY SECTION 321(b) OF THE ACT April 25, 1995 Securities and Exchange Commission Washington, D.C. 20549 Gentlemen: In connection with the qualification of an indenture between Chubb Capital Corporation and The First National Bank of Chicago, the undersigned, in accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby consents that the reports of examinations of the undersigned, made by Federal or State authorities authorized to make such examinations, may be furnished by such authorities to the Securities and Exchange Commission upon its request therefor. Very truly yours, THE FIRST NATIONAL BANK OF CHICAGO BY: /s/ JOHN R. PRENDIVILLE -------------------------- JOHN R. PRENDIVILLE VICE PRESIDENT 4 5 EXHIBIT 7 A copy of the latest report of conditions of the trustee published pursuant to law or the requirements of its supervising or examining authority. 5 6 Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/94 ST-BK: 17-1630 FFIEC 031 Address: One First National Plaza, Suite 0460 Page RC-1 City, State Zip: Chicago, IL 60670-0460 FDIC Certificate No.: 0/3/6/1/8
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL AND STATE-CHARTERED SAVINGS BANKS FOR DECEMBER 31, 1994 All schedules are to be reported in thousands of dollars. Unless otherwise indicated, report the amount outstanding of the last business day of the quarter. SCHEDULE RC--BALANCE SHEET
C400 <- DOLLAR AMOUNTS IN ------------ ----- THOUSANDS RCFD BIL MIL THOU ------------------ ---- ------------ ASSETS 1. Cash and balances due from depository institutions (from Schedule RC-A): a. Noninterest-bearing balances and currency and coin(1) . . . . 0081 3,776.149 1.a. b. Interest-bearing balances(2) . . . . . . . . . . . . . . . . . 0071 7,670,634 1.b. 2. Securities a. Held-to-maturity securities (from Schedule RC-B, column A) . . 1754 163,225 2.a. b. Available-for-sale securities (from Schedule RC-B, column D).. 1773 533,857 2.b. 3. Federal funds sold and securities purchased under agreements to resell in domestic offices of the bank and its Edge and Agreement subsidiaries, and in IBFs: a. Federal Funds sold . . . . . . . . . . . . . . . . . . . . . . 0276 4,037,205 3.a. b. Securities purchased under agreements to resell . . . . . . . 0277 423,381 3.b. 4. Loans and lease financing receivables: a. Loans and leases, net of unearned income (from Schedule RC-C) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 2122 15,617,618 4.a. b. LESS: Allowance for loan and lease losses . . . . . . . . . . RCFD 3123 351,191 4.b. c. LESS: Allocated transfer risk reserve . . . . . . . . . . . . RCFD 3128 0 4.c. d. Loans and leases, net of unearned income, allowance, and reserve (item 4.a minus 4.b and 4.c) . . . . . . . . . . . . . 2125 15,266,427 4.d. 5. Assets held in trading accounts . . . . . . . . . . . . . . . . . 3545 8,227,304 5. 6. Premises and fixed assets (including capitalized leases) . . . . 2145 512,222 6. 7. Other real estate owned (from Schedule RC-M) . . . . . . . . . . 2150 46,996 7. 8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M) . . . . . . . . . . . . . . . . . 2130 7,571 8. 9. Customers' liability to this bank on acceptances outstanding. . . 2155 507,151 9. 10. Intangible assets (from Schedule RC-M) . . . . . . . . . . . . . 2143 120,504 10. 11. Other assets (from Schedule RC-F) . . . . . . . . . . . . . . . 2160 1,250,306 11. 12. Total assets (sum of items 1 through 11) . . . . . . . . . . . . 2170 42,542,932 12.
__________________ (1) Includes cash items in process of collection and unposted debits. (2) Includes time certificates of deposit not held in trading accounts. 6 7 Legal Title of Bank: The First National Bank of Chicago Call Date: 12/31/94 ST-BK: 17-1630 FFIEC 031 Address: One First National Plaza, Suite 0460 Page RC-2 City, State Zip: Chicago, IL 60670-0460 FDIC Certificate No.: 0/3/6/1/8
SCHEDULE RC-CONTINUED
DOLLAR AMOUNTS IN Thousands BIL MIL THOU ---------------- ------------ LIABILITIES 13. Deposits: a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part 1) . . . . . . . . . . . . . . RCON 2200 15,103,504 13.a. (1) Noninterest-bearing(1) . . . . . . . . . . . . . . . RCON 6631 6,129,078 13.a.(1) (2) Interest-bearing . . . . . . . . . . . . . . . . . . RCON 6636 8,974,426 13.a.(2) b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E, part II) . . . . . . . . . . . RCFN 2200 10,633,999 13.b. (1) Noninterest bearing . . . . . . . . . . . . . . . . . RCFN 6631 460,916 13.b.(1) (2) Interest-bearing . . . . . . . . . . . . . . . . . RCFN 6636 10,173,083 13.b.(2) 14. 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: a. Federal funds purchased . . . . . . . . . . . . . . . . . RCFD 0278 2,883,499 14.a. b. Securities sold under agreements to repurchase . . . . . . RCFD 0279 502,401 14.b. 15. a. Demand notes issued to the U.S. Treasury . . . . . . . . RCON 2840 112,289 15.a. b. Trading Liabilities . . . . . . . . . . . . . . . . . . . RCFD 3548 4,798,720 15.b. 16. Other borrowed money: a. With original maturity of one year or less . . . . . . . . RCFD 2332 2,355,421 16.a. b. With original maturity of more than one year . . . . . . RCFD 2333 382,801 16.b. 17. Mortgage indebtedness and obligations under capitalized leases . . . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 2910 275,794 17. 18. Bank's liability on acceptance executed and outstanding RCFD 2920 507,151 18. 19. Subordinated notes and debentures . . . . . . . . . . . . . RCFD 3200 1,225,000 19. 20. Other liabilities (from Schedule RC-G) . . . . . . . . . . . RCFD 2930 860,989 20. 21. Total liabilities (sum of items 13 through 20). . . . . . . . RCFD 2948 39,641,568 21. 22. Limited-Life preferred stock and related surplus . . . . . . RCFD 3282 0 22. EQUITY CAPITAL 23. Perpetual preferred stock and related surplus . . . . . . . RCFD 3838 0 23. 24. Common stock . . . . . . . . . . . . . . . . . . . . . . . . RCFD 3230 200,858 24. 25. Surplus (exclude all surplus related to preferred stock) RCFD 3839 2,273,657 25. 26. a. Undivided profits and capital reserves . . . . . . . . . . RCFD 3632 431,545 26.a. b. Net unrealized holding gains (losses) on available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . RCFD 8434 [ 4,184) 26.b. 27. Cumulative foreign currency translation adjustments . . . . . RCFD 3284 (512) 27. 28. Total equity capital (sum of items 23 through 27) . . . . . . RCFD 3210 2,901,364 28. 29. Total liabilities, limited-life preferred stock, and equity capital (sum of items 21, 22, and 28) . . . . . . . . . . . . RCFD 3300 42,542,932 29.
Memorandum To be reported only with the March Report of Condition. 1. Indicate in the box at the right the number of the statement below that Number best describes the most comprehensive level of auditing work performed for -------------- the bank by independent external auditors as of any date during 1993 . . . . . . . . . . RCFD 6724 N/A M.1. --------------
1 = Independent audit of the bank conducted in accordance 4. = Directors' examination of the bank performed by other with generally accepted auditing standards by a certified external auditors (may be required by state chartering public accounting firm which submits a report on the bank authority) 2 = Independent audit of the bank's parent holding company 5 = Review of the bank's financial statements by external conducted in accordance with generally accepted auditing auditors standards by a certified public accounting firm which 6 = Compilation of the bank's financial statements by external submits a report on the consolidated holding company auditors (but not on the bank separately) 7 = Other audit procedures (excluding tax preparation work) 3 = Directors' examination of the bank conducted in 8 = No external audit work accordance with generally accepted auditing standards by a certified public accounting firm (may be required by state chartering authority)
___________________ (1) Includes total demand deposits and noninterest-bearing time and savings deposits. 7 -----END PRIVACY-ENHANCED MESSAGE-----