INDENTURE

Indenture Agreement

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AASTROM BIOSCIENCES INC

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Title: INDENTURE
Governing Law: Michigan Date: 3/24/2005
Industry: Biotechnology and Drugs Sector: Healthcare

INDENTURE, Parties: aastrom biosciences inc

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EXHIBIT 4.2

AASTROM BIOSCIENCES, INC.

ISSUER

AND

[________________________],

TRUSTEE

INDENTURE

DATED AS OF [______________], 20____

SUBORDINATED DEBT SECURITIES

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CROSS-REFERENCE TABLE(1)

<TABLE>

Section of Trust

Indenture Act of Section of

1939, as amended Indenture

---------------- ----------------

<S> <C>

310(a)....................................................... 7.09

310(b)....................................................... 7.08, 7.10

310(c)....................................................... Inapplicable

311(a)....................................................... 7.13(a)

311(b)....................................................... 7.13(b)

311(c)....................................................... Inapplicable

312(a)....................................................... 5.02(a)

312(b)....................................................... 5.02(b)

312(c)....................................................... 5.02(c)

313(a)....................................................... 5.04(a), 5.04(b)

313(b)....................................................... 5.04(b)

313(c)....................................................... 5.04(a)

313(d)....................................................... 5.04(c)

314(a)....................................................... 5.03

314(b)....................................................... Inapplicable

314(c)....................................................... 13.06

314(d)....................................................... Inapplicable

314(e)....................................................... 13.06

314(f)....................................................... Inapplicable

315(a)....................................................... 7.01(a), 7.02

315(b)....................................................... 6.07

315(c)....................................................... 7.01

315(d)....................................................... 7.01(b), 701(c)

315(e)....................................................... 6.07

316(a)....................................................... 6.06, 8.04

316(b)....................................................... 6.04

316(c)....................................................... 8.01

317(a)....................................................... 6.02

317(b)....................................................... 4.03

318(a)....................................................... 13.08

</TABLE>

(1) This Cross-Reference Table does not constitute part of the Indenture and

shall not have any bearing on the interpretation of any of its terms or

provisions.

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This INDENTURE, dated as of [_________________], 20__, is entered into

between Aastrom Biosciences, Inc., a Michigan corporation (the "Company"), and

[_________________], as trustee (the "Trustee") with respect to the following

facts:

WHEREAS, for its lawful corporate purposes, the Company has duly authorized

the execution and delivery of this Indenture to provide for the issuance of

unsecured subordinated debt securities (hereinafter referred to as the

"Securities"), in an unlimited aggregate principal amount to be issued from time

to time in one or more series as provided in this Indenture, as registered

Securities without coupons, to be authenticated by the certificate of the

Trustee; and

WHEREAS, to provide the terms and conditions upon which the Securities are

to be authenticated, issued and delivered, the Company has duly authorized the

execution of this Indenture.

NOW, THEREFORE, in consideration of the premises and the purchase of the

Securities by the holders thereof, the parties agree as follows for the equal

and ratable benefit of the holders of Securities:

ARTICLE I

DEFINITIONS

Section 1.01 Definitions of Terms.

The terms defined in this Section (except as otherwise expressly provided

in this Indenture or unless the context otherwise requires) for all purposes of

this Indenture and of any indenture supplemental hereto shall have the

respective meanings specified in this Section and shall include the plural as

well as the singular. All other terms used in this Indenture that are defined in

the Trust Indenture Act of 1939, as amended, or that are by reference in such

Act defined in the Securities Act of 1933, as amended (except as herein

otherwise expressly provided or unless the context otherwise requires), shall

have the meanings assigned to such terms in the Trust Indenture Act and in the

Securities Act as in force at the date of the execution of this instrument.

"Authenticating Agent" means an authenticating agent with respect to all or

any of the series of Securities appointed with respect to all or any series of

the Securities by the Trustee pursuant to Section 2.10.

"Bankruptcy Law" means Title 11, U.S. Code, or any similar federal or state

law for the relief of debtors.

"Board of Directors" means the Board of Directors of the Company or any

duly authorized committee of such Board.

"Board Resolution" means a copy of a resolution certified by the Secretary

or an Assistant Secretary of the Company to have been duly adopted by the Board

of Directors and to be in full force and effect on the date of such

certification.

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"Business Day" means, with respect to any series of Securities, any day

other than a day on which Federal or State banking institutions in the Borough

of Manhattan, The City of New York, are authorized or obligated by law,

executive order or regulation to close.

"Certificate" means a certificate signed by the principal executive

officer, the principal financial officer or the principal accounting officer of

the Company. The Certificate need not comply with the provisions of Section

13.07.

"Company" means Aastrom Biosciences, Inc., a corporation duly organized and

existing under the laws of the State of Michigan, and, subject to the provisions

of Article Ten, shall also include its successors and assigns.

"Corporate Trust Office" means the office of the Trustee at which, at any

particular time, its corporate trust business shall be principally administered,

which office at the date hereof is located at [_], except that whenever a

provision herein refers to an office or agency of the Trustee in the Borough of

Manhattan, The City of New York, such office is located, at the date hereof, at

[_].

"Custodian" means any receiver, trustee, assignee, liquidator, or similar

official under any Bankruptcy Law.

"Default" means any event, act or condition that with notice or lapse of

time, or both, would constitute an Event of Default.

"Depositary" means, with respect to Securities of any series, for which the

Company shall determine that such Securities will be issued as a Global

Security, The Depository Trust Company, New York, New York, another clearing

agency, or any successor registered as a clearing agency under the Securities

and Exchange Act of 1934, as amended (the "Exchange Act"), or other applicable

statute or regulation, which, in each case, shall be designated by the Company

pursuant to either Section 2.01 or 2.11.

"Event of Default" means, with respect to Securities of a particular series

any event specified in Section 6.01, continued for the period of time, if any,

therein designated.

"Global Security" means, with respect to any series of Securities, a

Security executed by the Company and delivered by the Trustee to the Depositary

or pursuant to the Depositary's instruction, all in accordance with the

Indenture, which shall be registered in the name of the Depositary or its

nominee.

"Governmental Obligations" means securities that are (i) direct obligations

of the United States of America for the payment of which its full faith and

credit is pledged or (ii) obligations of a Person controlled or supervised by

and acting as an agency or instrumentality of the United States of America, the

payment of which is unconditionally guaranteed as a full faith and credit

obligation by the United States of America that, in either case, are not

callable or redeemable at the option of the issuer thereof, and shall also

include a depositary receipt issued by a bank (as defined in Section 3(a)(2) of

the Securities Act of 1933, as amended) as custodian with respect to any such

Governmental Obligation or a specific payment of principal of or interest on any

such

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Governmental Obligation held by such custodian for the account of the holder of

such depositary receipt; provided, however, that (except as required by law)

such custodian is not authorized to make any deduction from the amount payable

to the holder of such depositary receipt from any amount received by the

custodian in respect of the Governmental Obligation or the specific payment of

principal of or interest on the Governmental Obligation evidenced by such

depositary receipt.

"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.

"Indenture" means this instrument as originally executed or as it may from

time to time be supplemented or amended by one or more indentures supplemental

hereto entered into in accordance with the terms hereof.

"Interest Payment Date," when used with respect to any installment of

interest on a Security of a particular series, means the date specified in such

Security or in a Board Resolution or in an indenture supplemental hereto with

respect to such series as the fixed date on which an installment of interest

with respect to Securities of that series is due and payable.

"Officers' Certificate" means a certificate signed by the President or a

Vice President and by the Treasurer or an Assistant Treasurer or the Controller

or an Assistant Controller or the Secretary or an Assistant Secretary of the

Company that is delivered to the Trustee in accordance with the terms hereof.

Each such certificate shall include the statements provided for in Section

13.07, if and to the extent required by the provisions thereof.

"Opinion of Counsel" means an opinion in writing of legal counsel, who may

be an employee of or counsel for the Company, that is delivered to the Trustee

in accordance with the terms hereof. Each such opinion shall include the

statements provided for in Section 13.07, if and to the extent required by the

provisions thereof.

"Outstanding," when used with reference to Securities of any series, means,

subject to the provisions of Section 8.04, as of any particular time, all

Securities of that series theretofore authenticated and delivered by the Trustee

under this Indenture, except (a) Securities theretofore canceled by the Trustee

or any paying agent, or delivered to the Trustee or any paying agent for

cancellation or that have previously been canceled; (b) Securities or portions

thereof for the payment or redemption of which moneys or Governmental

Obligations in the necessary amount shall have been deposited in trust with the

Trustee or with any paying agent (other than the Company) or shall have been set

aside and segregated in trust by the Company (if the Company shall act as its

own paying agent); provided, however, that if such Securities or portions of

such Securities are to be redeemed prior to the maturity thereof, notice of such

redemption shall have been given as in Article Three provided, or provision

satisfactory to the Trustee shall have been made for giving such notice; and (c)

Securities in lieu of or in substitution for which other Securities shall have

been authenticated and delivered pursuant to the terms of Section 2.07.

<PAGE>

"Person" means any individual, corporation, partnership, joint-venture,

joint-stock company, unincorporated organization or government or any agency or

political subdivision thereof.

"Predecessor Security" of any particular Security means every previous

Security evidencing all or a portion of the same debt as that evidenced by such

particular Security; and, for the purposes of this definition, any Security

authenticated and delivered under Section 2.07 in lieu of a lost, destroyed or

stolen Security shall be deemed to evidence the same debt as the lost, destroyed

or stolen Security.

"Responsible Officer" when used with respect to the Trustee means the

Chairman of the Board of Directors, the President, any Vice President, the

Secretary, the Treasurer, any trust officer, any corporate trust officer 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 or her knowledge of and familiarity with the particular subject.

"Securities" means the debt Securities authenticated and delivered under

this Indenture.

"Securityholder," "holder of Securities," "registered holder," or other

similar term, means the Person or Persons in whose name or names a particular

Security shall be registered on the books of the Company kept for that purpose

in accordance with the terms of this Indenture.

"Subsidiary" means, with respect to any Person, (i) any corporation at

least a majority of whose outstanding Voting Stock shall at the time be owned,

directly or indirectly, by such Person or by one or more of its Subsidiaries or

by such Person and one or more of its Subsidiaries, (ii) any general

partnership, joint venture or similar entity, at least a majority of whose

outstanding partnership or similar interests shall at the time be owned by such

Person, or by one or more of its Subsidiaries, or by such Person and one or more

of its Subsidiaries and (iii) any limited partnership of which such Person or

any of its Subsidiaries is a general partner.

"Trustee" means [_], and, subject to the provisions of Article Seven, shall

also include its successors and assigns, and, if at any time there is more than

one Person acting in such capacity hereunder, "Trustee" shall mean each such

Person. The term "Trustee" as used with respect to a particular series of the

Securities shall mean the trustee with respect to that series.

"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended,

subject to the provisions of Sections 9.01, 9.02, and 10.01, as in effect at the

date of execution of this instrument.

"Voting Stock," as applied to stock of any Person, means shares, interests,

participations or other equivalents in the equity interest (however designated)

in such Person having ordinary voting power for the election of a majority of

the directors (or the equivalent) of such Person, other than shares, interests,

participations or other equivalents having such power only by reason of the

occurrence of a contingency.

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ARTICLE II

ISSUE, DESCRIPTION, TERMS EXECUTION,

REGISTRATION AND EXCHANGE OF SECURITIES

Section 2.01 Designation and Terms of Securities.

(a) The aggregate principal amount of Securities that may be authenticated

and delivered under this Indenture is unlimited. The Securities may be issued in

one or more series up to the aggregate principal amount of Securities of that

series from time to time authorized by or pursuant to a Board Resolution of the

Company or pursuant to one or more indentures supplemental hereto. Prior to the

initial issuance of Securities of any series, there shall be established in or

pursuant to a Board Resolution of the Company, and set forth in an Officers'

Certificate of the Company, or established in one or more indentures

supplemental hereto:

(1) the title of the Security of the series (which shall distinguish

the Securities of the series from all other Securities);

(2) any limit upon the aggregate principal amount of the Securities of

that 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 that series);

(3) the date or dates on which the principal of the Securities of the

series is payable and the place(s) of payment;

(4) the rate or rates at which the Securities of the series shall bear

interest or the manner of calculation of such rate or rates, if any;

(5) the date or dates from which such interest shall accrue, the

Interest Payment Dates on which such interest will be payable or the manner of

determination of such Interest Payment Dates, the place(s) of payment, and the

record date for the determination of holders to whom interest is payable on any

such Interest Payment Dates;

(6) the right, if any, to extend the interest payment periods and the

duration of such extension;

(7) the period or periods within which, the price or prices at which

and the terms and conditions upon which, Securities of the series may be

redeemed, in whole or in part, at the option of the Company;

(8) the obligation, if any, of the Company to redeem or purchase

Securities of the series pursuant to any sinking fund or analogous provisions

(including payments made in cash in satisfaction of future sinking fund

obligations) or at the option of a holder thereof and the period or periods

within which, the price or prices at which, and the terms and conditions upon

which, Securities of the series shall be redeemed or purchased, in whole or in

part, pursuant to such obligation;

<PAGE>

(9) the subordination terms of the Securities of the series;

(10) the form of the Securities of the series including the form of

the Certificate of Authentication for such series;

(11) if other than denominations of one thousand U.S. dollars ($1,000)

or any integral multiple thereof, the denominations in which the Securities of

the series shall be issuable;

(12) any and all other terms with respect to such series (which terms

shall not be inconsistent with the terms of this Indenture, as amended by any

supplemental indenture) including any terms which may be required by or

advisable under United States laws or regulations or advisable in connection

with the marketing of Securities of that series;

(13) whether the Securities are issuable as a Global Security and, in

such case, the identity of the Depositary for such series;

(14) whether the Securities will be convertible into shares of common

stock or other securities of the Company and, if so, the terms and conditions

upon which such Securities will be so convertible, including the conversion

price and the conversion period;

(15) 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 6.01;

and

(16) any additional or different Events of Default or restrictive

covenants provided for with respect to the Securities of the series.

All Securities of any one series shall be substantially identical except as

to denomination and except as may otherwise be provided in or pursuant to any

such Board Resolution or in any indentures supplemental hereto.

If any of the terms of the series are established by action taken pursuant

to a Board Resolution of the Company, a copy of an appropriate record of such

action shall be certified by the Secretary or an Assistant Secretary of the

Company and delivered to the Trustee at or prior to the delivery of the

Officers' Certificate of the Company setting forth the terms of the series.

Securities of any particular series may be issued at various times, with

different dates on which the principal or any installment of principal is

payable, with different rates of interest, if any, or different methods by which

rates of interest may be determined, with different dates on which such interest

may be payable and with different redemption dates.

Section 2.02 Form of Securities and Trustee's Certificate.

The Securities of any series and the Trustee's certificate of

authentication to be borne by such Securities shall be substantially of the

tenor as set forth in one or more indentures supplemental hereto or as provided

in a Board Resolution of the Company and as set forth in an

<PAGE>

Officers' Certificate of the Company. The Securities may have such letters,

numbers or other marks of identification or designation and such legends or

endorsements printed, lithographed or engraved thereon as the Company may deem

appropriate and as are not inconsistent with the provisions of this Indenture,

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 exchange on which

Securities of that series may be listed, or to conform to usage.

Section 2.03 Denominations: Provisions for Payment.

The Securities shall be issuable as registered Securities and in the

denominations of one thousand U.S. dollars ($1,000) or any integral multiple

thereof, subject to Section 2.01(11). The Securities of a particular series

shall bear interest payable on the dates and at the rate specified with respect

to that series. The principal of and the interest on the Securities of any

series, as well as any premium thereon in case of redemption thereof prior to

maturity, shall be payable in the coin or currency of the United States of

America that at the time is legal tender for public and private debt, at the

office or agency of the Company maintained for that purpose in the Borough of

Manhattan, the City and State of New York. Each Security shall be dated the date

of its authentication. Interest on the Securities shall be computed on the basis

of a 360-day year composed of twelve 30-day months.

The interest installment on any Security that is payable, and is punctually

paid or duly provided for, on any Interest Payment Date for Securities of that

series shall be paid to the Person in whose name said Security (or one or more

Predecessor Securities) is registered at the close of business on the regular

record date for such interest installment. In the event that any Security of a

particular series or portion thereof is called for redemption and the redemption

date is subsequent to a regular record date with respect to any Interest Payment

Date and prior to such Interest Payment Date, interest on such Security will be

paid upon presentation and surrender of such Security as provided in Section

3.03.

Any interest on any Security that is payable, but is not punctually paid or

duly provided for, on any Interest Payment Date for Securities of the same

series (herein called "Defaulted Interest") shall forthwith cease to be payable

to the registered holder on the relevant regular record date by virtue of having

been such holder; and such Defaulted Interest shall be paid by the Company, at

its election, as provided in clause (1) or clause (2) below:

(1) The Company may make payment of any Defaulted Interest on

Securities to the Persons in whose names such Securities (or their respective

Predecessor Securities) are registered at the close of business on a special

record date for the payment of such Defaulted Interest, which shall be fixed in

the following manner: the Company shall notify the Trustee in writing of the

amount of Defaulted Interest proposed to be paid on each such Security and the

date of the proposed payment, and at the same time the Company shall deposit

with the Trustee an amount of money equal to the aggregate amount proposed to be

paid in respect of such Defaulted Interest or shall make arrangements

satisfactory to the Trustee for such deposit prior to the date of the proposed

payment, such money when deposited to be held in trust for the benefit of the

Persons entitled to such Defaulted Interest as in this clause provided.

Thereupon the Trustee shall fix a special record date for the payment of such

Defaulted Interest which shall not be more than 15 nor less than 10 days prior

to the date of the proposed payment and not less than

<PAGE>

10 days after the receipt by the Trustee of the notice of the proposed payment.

The Trustee shall promptly notify the Company of such special record date and,

in the name and at the expense of the Company, shall cause notice of the

proposed payment of such Defaulted Interest and the special record date therefor

to be mailed, first class postage prepaid, to each Securityholder at his or her

address as it appears in the Security Register (as hereinafter defined), not

less than 10 days prior to such special record date. Notice of the proposed

payment of such Defaulted Interest and the special record date therefor having

been mailed as aforesaid, such Defaulted Interest shall be paid to the Persons

in whose names such Securities (or their respective Predecessor Securities) are

registered on such special record date.

(2) The Company may make payment of any Defaulted Interest on any

Securities in any other lawful manner not inconsistent with the requirements of

any securities exchange on which such Securities may be listed, and upon such

notice as may be required by such exchange, if, after notice given by the

Company to the Trustee of the proposed payment pursuant to this clause, such

manner of payment shall be deemed practicable by the Trustee.

Unless otherwise set forth in a Board Resolution of the Company or one or

more indentures supplemental hereto establishing the terms of any series of

Securities pursuant to Section 2.01 hereof, the term "regular record date" as

used in this Section with respect to a series of Securities with respect to any

Interest Payment Date for such series shall mean either the fifteenth day of the

month immediately preceding the month in which an Interest Payment Date

established for such series pursuant to Section 2.01 hereof shall occur, if such

Interest Payment Date is the first day of a month, or the last day of the month

immediately preceding the month in which an Interest Payment Date established

for such series pursuant to Section 2.01 hereof shall occur, if such Interest

Payment Date is the fifteenth day of a month, whether or not such date is a

Business Day.

Subject to the foregoing provisions of this Section, each Security of a

series delivered under this Indenture upon transfer of or in exchange for or in

lieu of any other Security of such series shall carry the rights to interest

accrued and unpaid, and to accrue, that were carried by such other Security.

Section 2.04 Execution and Authentications.

The Securities shall be signed on behalf of the Company by its President,

or one of its Vice Presidents, or its Treasurer, or one of its Assistant

Treasurers, or its Secretary, or one of its Assistant Secretaries, under its

corporate seal attested by its Secretary or one of its Assistant Secretaries.

Signatures may be in the form of a manual or facsimile signature. The Company

may use the facsimile signature of any Person who shall have been a President or

Vice President thereof, or of any Person who shall have been a Secretary or

Assistant Secretary thereof, notwithstanding the fact that at the time the

Securities shall be authenticated and delivered or disposed of such Person shall

have ceased to be the President or a Vice President, or the Secretary or an

Assistant Secretary, of the Company. The seal of the Company may be in the form

of a facsimile of such seal and may be impressed, affixed, imprinted or

otherwise reproduced on the Securities. The Securities may contain such

notations, legends or endorsements required by law, stock exchange rule or

usage. Each Security shall be dated the date of its authentication by the

Trustee.

<PAGE>

A Security shall not be valid until authenticated manually by an authorized

signatory of the Trustee, or by an Authenticating Agent. Such signature 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.

At any time and from time to time after the execution and delivery of this

Indenture, the Company may deliver Securities of any series executed by the

Company to the Trustee for authentication, together with a written order of the

Company for the authentication and delivery of such Securities, signed by its

President or any Vice President and its Secretary or any Assistant Secretary,

and the Trustee in accordance with such written order shall authenticate and

deliver such Securities.

In authenticating such Securities and accepting the additional

responsibilities under this Indenture in relation to such Securities, the

Trustee shall be entitled to receive, and (subject to Section 7.01) shall be

fully protected in relying upon, an Opinion of Counsel stating that the form and

terms thereof have been established in conformity with the provisions of this

Indenture.

The Trustee shall not be required to authenticate such Securities if the

issue of such Securities pursuant to this Indenture will affect the Trustee's

own rights, duties or immunities under the Securities and this Indenture or

otherwise in a manner that is not reasonably acceptable to the Trustee.

Section 2.05 Registration of Transfer and Exchange.

(1) Securities of any series may be exchanged upon presentation

thereof at the office or agency of the Company designated for such purpose in

the Borough of Manhattan, the City and State of New York, for other Securities

of such series of authorized denominations, and for a like aggregate principal

amount, upon payment of a sum sufficient to cover any tax or other governmental

charge in relation thereto, all as provided in this Section. In respect of any

Securities so surrendered for exchange, the Company shall execute, the Trustee

shall authenticate and such office or agency shall deliver in exchange therefor

the Security or Securities of the same series that the Securityholder making the

exchange shall be entitled to receive, bearing numbers not contemporaneously

outstanding.

(2) The Company shall keep, or cause to be kept, at its office or

agency designated for such purpose in the Borough of Manhattan, the City and

State of New York, or such other location designated by the Company a register

or registers (herein referred to as the "Security Register") in which, subject

to such reasonable regulations as it may prescribe, the Company shall register

the Securities and the transfers of Securities as in this Article provided and

which at all reasonable times shall be open for inspection by the Trustee. The

registrar for the purpose of registering Securities and transfer of Securities

as herein provided shall be appointed as authorized by Board Resolution (the

"Security Registrar").

Upon surrender for transfer of any Security at the office or agency of the

Company designated for such purpose, the Company shall execute, the Trustee

shall authenticate and such office or agency shall deliver in the name of the

transferee or transferees a new Security or Securities of the same series as the

Security presented for a like aggregate principal amount.

<PAGE>

All Securities presented or surrendered for exchange or registration of

transfer, as provided in this Section, shall be accompanied (if so required by

the Company or the Security Registrar) by a written instrument or instruments of

transfer, in form satisfactory to the Company or the Security Registrar, duly

executed by the registered holder or by such holder's duly authorized attorney

in writing.

(3) No service charge shall be made for any exchange or registration

of transfer of Securities, or issue of new Securities in case of partial

redemption of any series, but the Company may require payment of a sum

sufficient to cover any tax or other governmental charge in relation thereto,

other than exchanges pursuant to Section 2.06, Section 3.03(b) and Section 9.04

not involving any transfer.

The Company shall not be required (i) to issue, exchange or register the

transfer of any Securities during a period beginning at the opening of business

15 days before the day of the mailing of a notice of redemption of less than all

the Outstanding Securities of the same series and ending at the close of

business on the day of such mailing, nor (ii) to register the transfer of or

exchange any Securities of any series or portions thereof called for redemption.

The provisions of this Section 2.05 are, with respect to any Global Security,

subject to Section 2.11 hereof.

Section 2.06 Temporary Securities.

Pending the preparation of definitive Securities of any series, the Company

may execute, and the Trustee shall authenticate and deliver, temporary

Securities (printed, lithographed or typewritten) of any authorized

denomination. Such temporary Securities shall be substantially in the form of

the definitive Securities in lieu of which they are issued, but with such

omissions, insertions and variations as may be appropriate for temporary

Securities, all as may be determined by the Company. Every temporary Security of

any series shall be executed by the Company and be authenticated by the Trustee

upon the same conditions and in substantially the same manner, and with like

effect, as the definitive Securities of such series. Without unnecessary delay

the Company will execute and will furnish definitive Securities of such series

and thereupon any or all temporary Securities of such series may be surrendered

in exchange therefor (without charge to the holders), at the office or agency of

the Company designated for the purpose in the Borough of Manhattan, the City and

State of New York, and the Trustee shall authenticate and such office or agency

shall deliver in exchange for such temporary Securities an equal aggregate

principal amount of definitive Securities of such series, unless the Company

advises the Trustee to the effect that definitive Securities need not be

executed and furnished until further notice from the Company. Until so

exchanged, the temporary Securities of such series shall be entitled to the same

benefits under this Indenture as definitive Securities of such series

authenticated and delivered hereunder.

Section 2.07 Mutilated, Destroyed, Lost or Stolen Securities.

In case any temporary or definitive Security shall become mutilated or be

destroyed, lost or stolen, the Company (subject to the next succeeding sentence)

shall execute, and upon the Company's request the Trustee (subject as aforesaid)

shall authenticate and deliver, a new Security of the same series, bearing a

number not contemporaneously outstanding, in exchange

<PAGE>

and substitution for the mutilated Security, or in lieu of and in substitution

for the Security so destroyed, lost or stolen. In every case the applicant for a

substituted Security shall furnish to the Company and the Trustee such security

or indemnity as may be required by them to save each of them harmless, and, in

every case of destruction, loss or theft, the applicant shall also furnish to

the Company and the Trustee evidence to their satisfaction of the destruction,

loss or theft of the applicant's Security and of the ownership thereof. The

Trustee may authenticate any such substituted Security and deliver the same upon

the written request or authorization of any officer of the Company. Upon the

issuance of any substituted Security, the Company may require the payment of a

sum sufficient to cover any tax or other governmental charge that may be imposed

in relation thereto and any other expenses (including the fees and expenses of

the Trustee) connected therewith. In case any Security that has matured or is

about to mature shall become mutilated or be destroyed, lost or stolen, the

Company 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

Security) if the applicant for such payment shall furnish to the Company and the

Trustee such security or indemnity as they may require to save them harmless,

and, in case of destruction, loss or theft, evidence to the satisfaction of the

Company and the Trustee of the destruction, loss or theft of such Security and

of the ownership thereof.

Every replacement Security issued pursuant to the provisions of this

Section shall constitute an additional contractual obligation of the Company

whether or not the mutilated, destroyed, lost or stolen Security shall be found

at any time, or be enforceable by anyone, and shall be entitled to all the

benefits of this Indenture equally and proportionately with any and all other

Securities of the same series duly issued hereunder. All Securities shall be

held and owned upon the express condition that the foregoing provisions are

exclusive with respect to the replacement or payment of mutilated, destroyed,

lost or stolen Securities, and shall preclude (to the extent lawful) any and all

other rights or remedies, notwithstanding any law or statute existing or

hereafter enacted to the contrary with respect to the replacement or payment of

negotiable instruments or other securities without their surrender.

Section 2.08 Cancellation.

All Securities surrendered for the purpose of payment, redemption, exchange

or registration of transfer shall, if surrendered to the Company or any paying

agent, be delivered to the Trustee for cancellation, or, if surrendered to the

Trustee, shall be cancelled by it, and no Securities shall be issued in lieu

thereof except as expressly required or permitted by any of the provisions of

this Indenture. On request of the Company at the time of such surrender, the

Trustee shall deliver to the Company canceled Securities held by the Trustee. In

the absence of such request the Trustee may dispose of canceled Securities in

accordance with its standard procedures and deliver a certificate of disposition

to the Company. If the Company shall otherwise acquire any of the Securities,

however, such acquisition shall not operate as a redemption or satisfaction of

the indebtedness represented by such Securities unless and until the same are

delivered to the Trustee for cancellation.

Section 2.09 Benefits of Indenture.

Nothing in this Indenture or in the Securities, express or implied, shall

give or be construed to give to any Person, other than the parties hereto and

the holders of the Securities

<PAGE>

(and, with respect to the provisions of Article Fourteen, the holders of Senior

Indebtedness) any legal or equitable right, remedy or claim under or in respect

of this Indenture, or under any covenant, condition or provision herein

contained; all such covenants, conditions and provisions being for the sole

benefit of the parties hereto and of the holders of the Securities (and, with

respect to the provisions of Article Fourteen, the holders of Senior

Indebtedness).

Section 2.10 Authenticating Agent.

So long as any of the Securities of any series remain Outstanding there may

be an Authenticating Agent for any or all such series of Securities which the

Trustee shall have the right to appoint. Said Authenticating Agent shall be

authorized to act on behalf of the Trustee to authenticate Securities of such

series issued upon exchange, transfer or partial redemption thereof, and

Securities so authenticated shall be entitled to the benefits of this Indenture

and shall be valid and obligatory for all purposes as if authenticated by the

Trustee hereunder. All references in this Indenture to the authentication of

Securities by the Trustee shall be deemed to include authentication by an

Authenticating Agent for such series. Each Authenticating Agent shall be

acceptable to the Company and shall be a corporation that has a combined capital

and surplus, as most recently reported or determined by it, sufficient under the

laws of any jurisdiction under which it is organized or in which it is doing

business to conduct a trust business, and that is otherwise authorized under

such laws to conduct such business and is subject to supervision or examination

by Federal or State authorities. If at any time any Authenticating Agent shall

cease to be eligible in accordance with these provisions, it shall resign

immediately.

Any Authenticating Agent may at any time resign by giving written notice of

resignation to the Trustee and to the Company. The Trustee may at any time (and

upon request by the Company shall) terminate the agency of any Authenticating

Agent by giving written notice of termination to such Authenticating Agent and

to the Company. Upon resignation, termination or cessation of eligibility of any

Authenticating Agent, the Trustee may appoint an eligible successor

Authenticating Agent acceptable to the Company. Any successor Authenticating

Agent, upon acceptance of its appointment hereunder, shall become vested with

all the rights, powers and duties of its predecessor hereunder as if originally

named as an Authenticating Agent pursuant hereto.

Section 2.11 Global Securities.

(a) If the Company shall establish pursuant to Section 2.01 that the

Securities of a particular series are to be issued as a Global Security, then

the Company shall execute and the Trustee shall, in accordance with Section

2.04, authenticate and deliver, a Global Security that (i) shall represent, and

shall be denominated in an amount equal to the aggregate principal amount of,

all of the Outstanding Securities of such series, (ii) shall be registered in

the name of the Depositary or its nominee, (iii) shall be delivered by the

Trustee to the Depositary or pursuant to the Depositary's instruction and (iv)

shall bear a legend substantially to the following effect: "Except as otherwise

provided in Section 2.11 of the Indenture, this Security may be transferred, in

whole but not in part, only to another nominee of the Depositary or to a

successor Depositary or to a nominee of such successor Depositary."

<PAGE>

(b) Notwithstanding the provisions of Section 2.05, the Global Security of

a series may be transferred, in whole but not in part and in the manner provided

in Section 2.05, only to another nominee of the Depositary for such series, or

to a successor Depositary for such series selected or approved by the Company or

to a nominee of such successor Depositary.

the Company that it is unwilling or unable to continue as Depositary for such

series or if at any time the Depositary for such series shall no longer be

registered or in good standing under the Exchange Act, or other applicable

statute or regulation, and a successor Depositary for such series is not

appointed by the Company within 90 days after the Company receives such notice

or becomes aware of such condition, as the case may be, this Section 2.11 shall

no longer be applicable to the Securities of such series and the Company will

execute, and subject to Section 2.05, the Trustee will authenticate and deliver

the Securities of such series in definitive registered form without coupons, in

authorized denominations, and in an aggregate principal amount equal to the

principal amount of the Global Security of such series in exchange for such

Global Security. In addition, the Company may at any time determine that the

Securities of any series shall no longer be represented by a Global Security and

that the provisions of this Section 2.11 shall no longer apply to the Securities

of such series. In such event the Company will execute and subject to Section

2.05, the Trustee, upon receipt of an Officers' Certificate evidencing such

determination by the Company, will authenticate and deliver the Securities of

such series in definitive registered form without coupons, in authorized

denominations, and in an aggregate principal amount equal to the principal

amount of the Global Security of such series in exchange for such Global

Security. Upon the exchange of the Global Security for such Securities in

definitive registered form without coupons, in authorized denominations, the

Global Security shall be canceled by the Trustee. Such Securities in definitive

registered form issued in exchange for the Global Security pursuant to this

Section 2.11(c) shall be registered in such names and in such authorized

denominations as the Depositary, pursuant to instructions from its direct or

indirect participants or otherwise, shall instruct the Trustee. The Trustee

shall deliver such Securities to the Depositary for delivery to the Persons in

whose names such Securities are so registered.

ARTICLE III

REDEMPTION OF SECURITIES AND SINKING FUND

PROVISIONS

Section 3.01 Redemption.

The Company may redeem the Securities of any series issued hereunder on and

after the dates and in accordance with the terms established for such series

pursuant to Section 2.01 hereof.

Section 3.02 Notice of Redemption.

(a) In case the Company shall desire to exercise such right to redeem all

or, as the case may be, a portion of the Securities of any series in accordance

with the right reserved so to do, the Company shall, or shall cause the Trustee

to, give notice of such redemption to holders of the Securities of such series

to be redeemed by mailing, first class postage prepaid, a notice of such

<PAGE>

redemption not less than 30 days and not more than 90 days before the date fixed

for redemption of that series to such holders at their last addresses as they

shall appear upon the Security Register unless a shorter period is specified in

the Securities to be redeemed. Any notice that is mailed in the manner herein

provided shall be conclusively presumed to have been duly given, whether or not

the registered holder receives the notice. In any case, failure duly to give

such notice to the holder of any Security of any series designated for

redemption in whole or in part, or any defect in the notice, shall not affect

the validity of the proceedings for the redemption of any other Securities of

such series or any other series. In the case of any redemption of Securities

prior to the expiration of any restriction on such redemption provided in the

terms of such Securities or elsewhere in this Indenture, the Company shall

furnish the Trustee with an Officers' Certificate evidencing compliance with any

such restriction.

Each such notice of redemption shall specify the date fixed for redemption

and the redemption price at which Securities of that series are to be redeemed,

and shall state that payment of the redemption price of such Securities to be

redeemed will be made at the office or agency of the Company in the Borough of

Manhattan, the City and State of New York, upon presentation and surrender of

such Securities, that interest accrued to the date fixed for redemption will be

paid as specified in said notice, that from and after said date interest will

cease to accrue and that the redemption is for a sinking fund, if such is the

case. If less than all the Securities of a series are to be redeemed, the notice

to the holders of Securities of that series to be redeemed in whole or in part

shall specify the particular Securities to be so redeemed. In case any Security

is to be redeemed in part only, the notice that relates to such Security shall

state the portion of the principal amount thereof to be redeemed, and shall

state that on and after the redemption date, upon surrender of such Security, a

new Security or Securities of such series in principal amount equal to the

unredeemed portion thereof will be issued.

(b) If less than all the Securities of a series are to be redeemed, the

Company shall give the Trustee at least 45 days' notice in advance of the date

fixed for redemption as to the aggregate principal amount of Securities of the

series to be redeemed, and thereupon the Trustee shall select, by lot or in such

other manner as it shall deem appropriate and fair in its discretion and that

may provide for the selection of a portion or portions (equal to one thousand

U.S. dollars ($1,000) or any integral multiple thereof) of the principal amount

of such Securities of a denomination larger than $1,000, the Securities to be

redeemed and shall thereafter promptly notify the Company in writing of the

numbers of the Securities to be redeemed, in whole or in part.

The Company may, if and whenever it shall so elect, by delivery of

instructions signed on its behalf by its President or any Vice President,

instruct the Trustee or any paying agent to call all or any part of the

Securities of a particular series for redemption and to give notice of

redemption in the manner set forth in this Section, such notice to be in the

name of the Company or its own name as the Trustee or such paying agent may deem

advisable. In any case in which notice of redemption is to be given by the

Trustee or any such paying agent, the Company shall deliver or cause to be

delivered to, or permit to remain with, the Trustee or such paying agent, as the

case may be, such Security Register, transfer books or other records, or

suitable copies or extracts therefrom, sufficient to enable the Trustee or such

paying agent to give any notice by mail that may be required under the

provisions of this Section.

<PAGE>

Section 3.03 Payment Upon Redemption.

(a) If the giving of notice of redemption shall have been completed as

above provided, the Securities or portions of Securities of the series to be

redeemed 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 interest on such

Securities or portions of Securities shall cease to accrue on and after the date

fixed for redemption, unless the Company shall default in the payment of such

redemption price and accrued interest with respect to any such Security or

portion thereof. On presentation and surrender of such Securities on or after

the date fixed for redemption at the place of payment specified in the notice,

said Securities shall be paid and redeemed at the applicable redemption price

for such series, together with interest accrued thereon to the date fixed for

redemption (but if the date fixed for redemption is an interest payment date,

the interest installment payable on such date shall be payable to the registered

holder at the close of business on the applicable record date pursuant to

Section 2.03).

(b) Upon presentation of any Security of such series that is to be redeemed

in part only, the Company shall execute and the Trustee shall authenticate and

the office or agency where the Security is presented shall deliver to the holder

thereof, at the expense of the Company, a new Security of the same series of

authorized denominations in principal amount equal to the unredeemed portion of

the Security so presented.

Section 3.04 Sinking Fund.

The provisions of Sections 3.04, 3.05 and 3.06 shall be applicable to any

sinking fund for the retirement of Securities of a series, except as otherwise

specified as contemplated by Section 2.01 for Securities of such series.

The minimum amount of any sinking fund payment provided for by the terms of

Securities of any series is herein referred to as a "mandatory sinking fund

payment," and any payment in excess of such minimum amount provided for by the

terms of Securities of any series is herein referred to as an "optional sinking

fund payment". If provided for by the terms of Securities of any series, the

cash amount of any sinking fund payment may be subject to reduction as provided

in Section 3.05. Each sinking fund payment shall be applied to the redemption of

Securities of any series as provided for by the terms of Securities of such

series.

Section 3.05 Satisfaction of Sinking Fund Payments with Securities.

The Company (i) may deliver Outstanding Securities of a series (other than

any Securities previously called for redemption) and (ii) may apply as a credit

Securities of a series that have been redeemed either at the election of the

Company pursuant to the terms of such Securities or through the application of

permitted optional sinking fund payments pursuant to the terms of such

Securities, in each case in satisfaction of all or any part of any sinking fund

payment with respect to the Securities of such series required to be made

pursuant to the terms of such Securities as provided for by the terms of such

series, provided that such Securities have not been previously so credited. Such

Securities shall be received and credited for such purpose by

<PAGE>

the Trustee at the redemption price specified in such Securities for redemption

through operation of the sinking fund and the amount of such sinking fund

payment shall be reduced accordingly.

Section 3.06 Redemption of Securities for Sinking Fund.

Not less than 45 days prior to each sinking fund payment date for any

series of Securities, the Company will deliver to the Trustee an Officers'

Certificate specifying the amount of the next ensuing sinking fund payment for

that series pursuant to the terms of the series, the portion thereof, if any,

that is to be satisfied by delivering and crediting Securities of that series

pursuant to Section 3.05 and the basis for such credit and will, together with

such Officers' Certificate, deliver to the Trustee any Securities to be so

delivered. Not less than 30 days before each such sinking fund payment date the

Trustee shall select the Securities to be redeemed upon such sinking fund

payment date in the manner specified in Section 3.02 and cause notice of the

redemption thereof to be given in the name of and at the expense of the Company

in the manner provided in Section 3.02. Such notice having been duly given, the

redemption of such Securities shall be made upon the terms and in the manner

stated in Section 3.03.

ARTICLE IV

COVENANTS

Section 4.01 Payment of Principal, Premium and Interest.

The Company will duly and punctually pay or cause to be paid the principal

of (and premium, if any) and interest on the Securities of that series at the

time and place and in the manner provided herein and established with respect to

such Securities.

Section 4.02 Maintenance of Office or Agency.

So long as any series of the Securities remain Outstanding, the Company

agrees to maintain an office or agency in the Borough of Manhattan, the City and

State of New York, with respect to each such series and at such other location

or locations as may be designated as provided in this Section 4.02, where (i)

Securities of that series may be presented for payment, (ii) Securities of that

series may be presented as herein above authorized for registration of transfer

and exchange, and (iii) notices and demands to or upon the Company in respect of

the Securities of that series and this Indenture may be given or served, such

designation to continue with respect to such office or agency until the Company

shall, by written notice signed by its President or a Vice President and

delivered to the trustee, designate some other office or agency for such

purposes or any of them. If at any time the Company shall fail to maintain any

such required office or agency or shall fail to furnish the Trustee with the

address thereof, such presentations, notices and demands may be made or served

at the Corporate Trust Office of the Trustee, and the Company hereby appoints

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

<PAGE>

Section 4.03 Paying Agents.

(a) If the Company shall appoint one or more paying agents for all or any

series of the Securities, other than the Trustee, the Company will cause each

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:

(1) that it will hold all sums held by it as such agent for the

payment of the principal of (and premium, if any) or interest on the Securities

of that series (whether such sums have been paid to it by the Company or by any

other obligor of such Securities) in trust for the benefit of the Persons

entitled thereto;

(2) that it will give the Trustee notice of any failure by the Company

(or by any other obligor of such Securities) to make any payment of the

principal of (and premium, if any) or interest on the Securities of that series

when the same shall be due and payable;

(3) that it will, at any time during the continuance of any failure

referred to in the preceding paragraph (a)(2) above, upon the written request of

the Trustee, forthwith pay to the Trustee all sums so held in trust by such

paying agent; and

(4) that it will perform all other duties of paying agent as set forth

in this Indenture.

(b) If the Company shall act as its own paying agent with respect to any

series of the Securities, it will on or before each due date of the principal of

(and premium, if any) or interest on Securities of that series, set aside,

segregate and hold in trust for the benefit of the Persons entitled thereto a

sum sufficient to pay such principal (and premium, if any) or interest so

becoming due on Securities of that series until such sums shall be paid to such

Persons or otherwise disposed of as herein provided and will promptly notify the

Trustee of such action, or any failure (by it or any other obligor on such

Securities) to take such action. Whenever the Company shall have one or more

paying agents for any series of Securities, it will, prior to each due date of

the principal of (and premium, if any) or interest on any Securities of that

series, deposit with the paying agent a sum sufficient to pay the principal (an

premium, if any) or interest so becoming due, such sum to be held in trust for

the benefit of the Persons entitled to such principal, premium or interest, and

(unless such paying agent is the Trustee) the Company will promptly notify the

Trustee of this action or failure so to act.

agreement to hold sums in trust as provided in this Section is subject to the

provisions of Section 11.05, and (ii) the Company may at any time, for the

purpose of obtaining the satisfaction and discharge of this Indenture or for any

other purpose, pay, or direct any paying agent to pay, to the Trustee all sums

held in trust by the Company or such paying agent, such sums to be held by the

Trustee upon the same terms and conditions as those upon which such sums were

held by the Company or such paying agent; and, upon such payment by any paying

agent to the Trustee, such paying agent shall be released from all further

liability with respect to such money.

<PAGE>

Section 4.04 Appointment t

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