INDENTURE

 

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                                                                     EXHIBIT 4.2

 

                               CENTEX CORPORATION

 

                                     Issuer

 

                                      and

 

                               JPMORGAN CHASE BANK

 

                      (formerly The Chase Manhattan Bank)

 

                                    Trustee

 

                          INDENTURE SUPPLEMENT NO. 14

 

                            Dated as of May 5, 2004

 

                                        to

 

                                   INDENTURE

 

                          Dated as of October 1, 1998

 

                      5.70% Senior Notes due May 15, 2014

 

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                               TABLE OF CONTENTS

 

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ARTICLE ONE   Definitions.......................................................................     1

 

ARTICLE TWO   TERMS AND ISSUANCE OF THE NOTES...................................................     3

         Section 2.01.      Issuance and Designation............................................     3

         Section 2.02.      Form and Other Terms of Notes; Incorporation of Terms...............     3

         Section 2.03.      Place and Method of Payment.........................................     3

 

ARTICLE THREE   ADDITIONAL COVENANTS............................................................     4

         Section 3.01.      Limitation on Liens.................................................     4

          Section 3.02.      Limitation on Sale and Lease-Back Transactions......................     6

 

ARTICLE FOUR   DEFEASANCE.......................................................................     6

         Section 4.01.      Option to Effect Legal Defeasance or Covenant Defeasance............     6

         Section 4.02.      Legal Defeasance....................................................     6

         Section 4.03.      Covenant Defeasance.................................................     7

         Section 4.04.      Conditions to Covenant Defeasance...................................     7

 

ARTICLE FIVE   MISCELLANEOUS....................................................................     8

         Section 5.01.      Ratification of Indenture...........................................     8

         Section 5.02.      Redemption..........................................................     8

         Section 5.03.      Conflict with Trust Indenture Act...................................     8

         Section 5.04.      Effect of Headings..................................................     8

         Section 5.05.      Counterparts........................................................     8

         Section 5.06.      Severability........................................................     8

         Section 5.07.      Benefits of Indenture Supplement....................................     8

         Section 5.08.      Acceptance of Trusts................................................     9

         Section 5.09.       Governing Law.......................................................     9

 

EXHIBIT A   -                Form of Note

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            INDENTURE SUPPLEMENT NO. 14 ("Indenture Supplement"), dated as of

May 5, 2004, between CENTEX CORPORATION, a Nevada corporation (together with its

successors and assigns as provided in the Indenture referred to below, the

"Company"), and JPMORGAN CHASE BANK, a New York banking corporation (formerly,

The Chase Manhattan Bank, successor to Chase Bank of Texas, National

Association) (together with its successors in trust thereunder as provided in

the Indenture referred to below, the "Trustee"), as trustee under an Indenture

dated as of October 1, 1998 (the "Indenture").

 

                              PRELIMINARY STATEMENT

 

            Section 2.02 of the Indenture provides, among other things, that the

Company may, when authorized by its Board of Directors, and the Trustee may at

any time and from time to time, enter into a series supplement to the Indenture

for the purpose of authorizing one or more Series of Senior Debt Securities and

to specify certain terms of each such Series of Senior Debt Securities. The

Board of Directors of the Company has duly authorized the creation of a Series

of Senior Debt Securities to be known as the Company's 5.70% Senior Notes due

2014 (the "Notes"), and the Company and the Trustee are executing and delivering

this Indenture Supplement in order to provide for the issuance of the Notes.

 

                                   ARTICLE ONE

 

                                  Definitions

 

            Except to the extent such terms are otherwise defined in this

Indenture Supplement or the context clearly requires otherwise, all terms used

in this Indenture Supplement which are defined in the Indenture or the form of

Note attached hereto as Exhibit A, either directly or by reference therein,

shall have the meanings assigned to them therein.

 

            As used in this Indenture Supplement, the following terms shall have

the following meanings:

 

CONSOLIDATED NET TANGIBLE ASSETS:

 

            The term "Consolidated Net Tangible Assets" shall mean the aggregate

amount of assets included on the most recent consolidated balance sheet of the

Company and its subsidiaries, less applicable reserves and other properly

deductible items and after deducting therefrom (a) all current liabilities and

(b) all goodwill, trade names, trademarks, patents, unamortized debt discount

and expense, and other like intangibles, all in accordance with generally

accepted accounting principles consistently applied.

 

DEPOSITARY:

 

            The term "Depositary" shall mean, unless otherwise specified by the

Company, The Depository Trust Company, New York, New York, or any successor

thereto registered as a Clearing Agency under the Securities Exchange Act of

1934, as amended, or any successor statute or regulation.

 

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FUNDED INDEBTEDNESS:

 

            The term "Funded Indebtedness" shall mean notes, bonds, debentures

or other similar evidences of indebtedness for money borrowed which by their

terms mature at or are extendible or renewable at the option of the obligor to a

date more than 12 months after the date of the creation of such debt.

 

GLOBAL SECURITY:

 

            The term "Global Security" shall mean a single Note that is issued

to evidence Notes having identical terms and provisions, which is delivered to

the Depositary or pursuant to instructions of the Depositary and which shall be

registered in the name of the Depositary or its nominee.

 

INTEREST PAYMENT DATE:

 

            The term "Interest Payment Date" means the Stated Maturity of an

installment of interest on the Notes.

 

MATURITY DATE:

 

            The term "Maturity Date," when used with respect to any Note, shall

mean the date on which the principal of such Note becomes due and payable in

accordance with its terms and the terms of this Indenture as therein or herein

provided, whether at Stated Maturity, upon declaration of acceleration, call for

redemption or otherwise.

 

NOTEHOLDER; HOLDER:

 

            The terms "Noteholder" or "Holder" shall mean any Person in whose

name at the time a particular Note is registered in the Senior Debt Security

Register kept for that purpose in accordance with the terms hereof.

 

REGULAR RECORD DATE:

 

            The term "Regular Record Date" for the interest payable on any

Interest Payment Date shall mean the day which is fifteen calendar days

immediately prior to such Interest Payment Date, whether or not such day is a

business day.

 

REDEMPTION DATE:

 

            The term "Redemption Date" for a Note shall mean the date fixed for

the redemption of such Note in accordance with the provisions of this Indenture

Supplement.

 

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SPECIAL RECORD DATE:

 

            The term "Special Record Date" for the payment of any defaulted

interest means a date which is not less than ten and not more than fifteen

calendar days immediately preceding the Interest Payment Date of defaulted

interest on such Note established by notice given by first class mail by or on

behalf of the Company to the Holder of such Note not less than fifteen calendar

days prior to such Special Record Date.

 

STATED MATURITY:

 

            The term "Stated Maturity" means, when used with respect to any Note

or any installment of interest thereon (including defaulted interest), the date

specified in such Note as the fixed date upon which the principal of such Note

or such installment of interest is due and payable.

 

                                   ARTICLE TWO

 

                        Terms and Issuance of the Notes

 

            Section 2.01. Issuance and Designation. A Series of Senior Debt

Securities which shall be designated as the Company's "5.70% Senior Notes due

2014" shall be executed, authenticated and delivered in accordance with the

provisions of, and shall in all respects be subject to, the terms, conditions

and covenants of, the Indenture and this Indenture Supplement (including the

form of Note set forth in Exhibit A). The aggregate principal amount of the

Notes which may be authenticated and delivered under this Indenture Supplement

shall not, except as permitted by the provisions of the Indenture, exceed

$350,000,000, provided that the Company may, without the consent of the Holders

of the Notes, reopen this Series and issue additional Notes under the Indenture

and this Indenture Supplement in addition to the $350,000,000 of Notes

authorized as of the date hereof.

 

            Section 2.02. Form and Other Terms of Notes; Incorporation of Terms.

The Notes shall be substantially in the form attached hereto as Exhibit A. The

terms of such Notes are herein incorporated by reference and are part of this

Indenture Supplement.

 

            Section 2.03. Place and Method of Payment. The place of payment in

respect of the Notes will be at the principal office or agency of the Company in

Dallas, Texas or at the office or place of business of the Trustee or its

successor in trust under the Indenture, which, at the date hereof, is located at

Chase Global Trust, 450 W. 33rd Street, 15th Floor, New York, New York 10001.

Payments in respect of principal or premium, if any, on Notes will be made only

against surrender of such Notes at such office. Payments of interest on each

Interest Payment Date with respect to each Note will be made to the Person in

whose name such Note is registered at the close of business on the Regular

Record Date immediately preceding such Interest Payment Date by U.S. dollar

check drawn on a bank in the City of New York or, for Holders of at least

$1,000,000 of Notes, by wire transfer to a dollar account maintained by the

payee with a bank in the United States; provided that a written request from

such Holder to such effect

 

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designating such account is received by the Trustee or the Paying Agent no later

than 30 calendar days preceding such Interest Payment Date. Unless such

designation is revoked, any such designation made by such Holder with respect to

such Note payable to such Holder will remain in effect with respect to any

further interest payments with respect to such Note payable to such Holder. The

Company will pay any administrative costs imposed by banks in connection with

making interest payments by wire transfer.

 

             So long as the Depositary continues to make its "Same-Day Funds

Settlement System" available to the Company, payments due on Notes represented

by a Global Security registered in the name of the Depositary or its nominee

will be made in immediately available funds to the Depositary or its nominee, as

the case may be, as the registered owner of the Global Security representing

such Notes. The Company expects that the Depositary or its nominee, upon receipt

of any payment, will credit immediately participants' accounts with payments in

same-day funds in amounts proportionate to their respective beneficial interests

in such payments, as shown on the records of the Depositary or its nominee. The

Company also expects that payments by participants and indirect participants to

owners of beneficial interests in such Global Security held through such Persons

will be governed by standing instructions and customary practices, as is now the

case with securities registered in the name of nominees for such customers, and

will be the responsibility of such participants and indirect participants.

 

                                 ARTICLE THREE

 

                              Additional Covenants

 

            Section 3.01. Limitation on Liens. The following provisions shall

apply to the Notes:

 

            (a)    The Company will not itself, and will not permit any of its

      subsidiaries (other than Centex Financial Services, Inc. and its

      subsidiaries) to, issue, assume or guarantee any indebtedness for borrowed

       money ("Indebtedness") if such borrowed money is secured by a mortgage,

      pledge, security interest, lien or other encumbrance (any such mortgage,

      pledge, security interest, lien or other encumbrance being hereinafter in

      this Section 3.01 referred to as a "Lien") on or with respect to any of

      the properties or assets of the Company or any such subsidiary or on any

      shares of capital stock or other equity interests of any subsidiary that

      owns properties or assets (other than Centex Financial Services, Inc. and

      its subsidiaries), whether, in each case, owned at the date of this

      Indenture Supplement or thereafter acquired, unless the Company makes

      effective provision whereby the Notes are secured by such Lien equally and

      ratably with any and all other borrowed money thereby secured; provided,

      however, that the foregoing restrictions shall not be applicable to:

 

                  (i)    any Lien existing on any of the Company's properties or

             assets or shares of capital stock or other equity interests at the

            date of this Indenture Supplement;

 

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                  (ii)   any Lien created by a subsidiary of the Company in favor

             of the Company or any wholly-owned subsidiary;

 

                  (iii) any Lien on any property or asset of any corporation or

            other entity (or on any accession or improvement to such asset or

            any proceeds thereof) existing at the time such corporation or other

            entity becomes a subsidiary of the Company or is merged or

            consolidated with or into the Company or any of its subsidiaries;

 

                  (iv)   any Lien on any property or asset existing at the time

            of acquisition thereof (or on any accession or improvement to such

            property or asset or any proceeds thereof) by the Company or any of

            its subsidiaries;

 

                  (v)    any Lien on any property or asset (or on any accession

            or improvement to such property or asset or any proceeds thereof)

            securing Indebtedness incurred or assumed for the purpose of

            financing all or any part of the cost of acquiring such property or

             asset or the making of any improvement thereof; provided that such

            Lien attaches to such property or asset concurrently with or within

            180 days after the acquisition thereof or the making of such

            improvement;

 

                   (vi)   any Lien incurred in connection with pollution control,

            industrial revenue or any similar financing;

 

                  (vii) any Lien arising out of the refinancing, extension,

            renewal or replacement of any of the Liens permitted by any of

            clauses (i) through (vi) above; provided that the principal amount

            of the Indebtedness secured by the Lien being refinanced, extended,

            reviewed or replaced is not increased and is not secured by any

            additional properties or assets; and

 

                  (viii) any Lien imposed by law.

 

            (b)    Notwithstanding the provisions of subsection (a) of this

      Section 3.01, the Company or any of its subsidiaries may issue, assume or

      guarantee Indebtedness secured by a Lien which would otherwise be subject

      to the foregoing restrictions in an aggregate amount which, together with

      all other such secured borrowings of the Company and its subsidiaries and

      the Attributable Debt (as defined below) in respect of Sale and Lease-Back

      Transactions (as defined in Section 3.02) existing at such time (other

      than Sale and Lease-Back Transactions not subject to the limitation

      contained in Section 3.02), does not at the time exceed twenty percent

      (20%) of the Consolidated Net Tangible Assets of the Company and its

      subsidiaries, as shown on the audited consolidated balance sheet contained

      in the latest annual report to stockholders of the Company. The term

      "Attributable Debt" as used in this paragraph shall mean, as of any

      particular time, the present value of the obligation of a lessee for

      rental payments during the remaining term of any lease (including any

      period for which such lease has been extended or may, at the option of the

      lessor, be extended).

 

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            Section 3.02. Limitation on Sale and Lease-Back Transactions. The

Company will not, nor will it permit any of its subsidiaries to, enter into any

arrangement with any Person (other than the Company) providing for the leasing

by the Company or a subsidiary of any of its properties or assets (except for

temporary leases for a term of not more than three (3) years and except for

sales and leases of model homes), which property or asset has been or is to be

sold or transferred by the Company or such subsidiary to such Person (herein

referred to as a "Sale and Lease-Back Transaction"), unless (a) the net proceeds

to the Company or such subsidiary from such sale or transfer equal or exceed the

fair value (as determined by the Board of Directors, the Chairman of the Board,

the Vice Chairman, the President or the principal financial officer of the

Company) of the property or asset so leased, (b) the Company or such subsidiary

would be entitled to incur Indebtedness secured by a Lien on the property or

asset to be leased pursuant to Section 3.01, (c) the Company shall, and in any

such case the Company covenants that it will, apply an amount equal to the fair

value (as determined by the Board of Directors, the Chairman of the Board, the

Vice Chairman, the President or the principal financial officer of the Company)

of the property or asset so leased to the retirement (other than any mandatory

retirement), within 180 days of the effective date of any such Sale and

Lease-Back Transaction, of Funded Indebtedness of the Company, (d) such Sale and

Lease-Back Transaction relates to a sale which occurred within 180 days from the

date of acquisition of such property or asset by the Company or a subsidiary or

the date of the completion of construction or commencement of full operations on

such property, whichever is later, or (e) such transaction was consummated prior

to the date of this Indenture Supplement.

 

                                  ARTICLE FOUR

 

                                   Defeasance

 

            Section 4.01. Option to Effect Legal Defeasance or Covenant

Defeasance. The Company may, at any time, with respect to the Notes, elect to

have either Section 13.01 of the Indenture or Section 4.03 of this Indenture

Supplement be applied to all outstanding Notes upon compliance with the

conditions set forth in Article Thirteen of the Indenture and below in this

Article Four.

 

            Section 4.02. Legal Defeasance. Upon the Company's exercise under

Section 4.01 of the option applicable to Section 13.01 of the Indenture, the

Company may terminate its obligations under the Notes, the Indenture and this

Indenture Supplement by complying with the terms and conditions of Section 13.01

of the Indenture; provided, however, that the Opinion of Counsel delivered to

the Trustee will also state that either (A) the Company has received from, or

there has been published by, the Internal Revenue Service, a ruling or (B) since

the date hereof, there has been a change in the applicable federal income tax

law, in either case to the effect that, and based thereon such Opinion of

Counsel shall confirm that, the Holders of the outstanding Notes will not

recognize income, gain or loss for federal income tax purposes as a result of

such defeasance and will be subject to federal income tax on the same amounts,

in the same manner and at the same times as would have been the case if such

defeasance had not occurred.

 

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            Section 4.03. Covenant Defeasance. Upon the Company's exercise under

Section 4.01 of the option applicable to this Section 4.03, the Company shall be

released from its obligations under the covenants contained in Article Three of

this Indenture Supplement with respect to the outstanding Notes on and after the

date the conditions set forth below are satisfied ("Covenant Defeasance"), and

the Notes shall thereafter be deemed not "outstanding" for the purposes of any

direction, waiver, consent or declaration or act of Holders (and the

consequences of any thereof) in connection with su