-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CvITDoWc7M6KjriB0i+APlpDaWLJO5qdO+HyqcLzHFgNXxpJyAmcOOyu9fq6d/jx 4UDDSuaf9fQVFPBacMjRcA== 0000950117-03-003009.txt : 20030715 0000950117-03-003009.hdr.sgml : 20030715 20030715170058 ACCESSION NUMBER: 0000950117-03-003009 CONFORMED SUBMISSION TYPE: S-4 PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 20030715 FILER: COMPANY DATA: COMPANY CONFORMED NAME: LEUCADIA NATIONAL CORP CENTRAL INDEX KEY: 0000096223 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 132615557 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-4 SEC ACT: 1933 Act SEC FILE NUMBER: 333-107059 FILM NUMBER: 03787713 BUSINESS ADDRESS: STREET 1: 315 PARK AVE S CITY: NEW YORK STATE: NY ZIP: 10010 BUSINESS PHONE: 2124601900 MAIL ADDRESS: STREET 1: 315 PARK AVENUE SOUTH CITY: NEW YORK STATE: NY ZIP: 10010 FORMER COMPANY: FORMER CONFORMED NAME: TALCOTT NATIONAL CORP DATE OF NAME CHANGE: 19800603 S-4 1 a35625.txt LEUCADIA NATIONAL CORPORATION AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 15, 2003 REGISTRATION NO. 333- ________________________________________________________________________________ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------- FORM S-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------- LEUCADIA NATIONAL CORPORATION (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) ------------------- NEW YORK 6331 13-2615557 (STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
------------------- LEUCADIA NATIONAL CORPORATION 315 PARK AVENUE SOUTH NEW YORK, NEW YORK 10010 (212) 460-1900 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) JOSEPH A. ORLANDO LEUCADIA NATIONAL CORPORATION 315 PARK AVENUE SOUTH NEW YORK, NEW YORK 10010 (212) 460-1900 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) ------------------- WITH COPIES TO: ANDREA BERNSTEIN, ESQ. WEIL, GOTSHAL & MANGES LLP 767 FIFTH AVENUE NEW YORK, NEW YORK 10153-0119 (212) 310-8000 ------------------- APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as practicable after the effective date of this Registration Statement. If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box: [ ] If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] ------------------- CALCULATION OF REGISTRATION FEE CHART
PROPOSED MAXIMUM PROPOSED MAXIMUM AGGREGATE TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE OFFERING AMOUNT OF SECURITIES TO BE REGISTERED REGISTERED PER NOTE(1) PRICE(1) REGISTRATION FEE 7% Senior Notes Due 2013. $200,000,000 100% $200,000,000 $16,180
(1) Estimated solely for purposes of calculating the registration fee pursuant to Rule 457(f) under the Securities Act of 1933. ------------------- THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. ________________________________________________________________________________ PROSPECTUS LEUCADIA NATIONAL CORPORATION [LEUCADIA LOGO] OFFER TO EXCHANGE ALL OUTSTANDING 7% SENIOR NOTES DUE 2013 FOR AN EQUAL AMOUNT OF 7% SENIOR NOTES DUE 2013 WHICH HAVE BEEN REGISTERED ------------------- MATERIAL TERMS OF THE EXCHANGE OFFER Expires at 5:00 p.m., New York City time, on , 2003, unless extended. The only conditions to completing the exchange offer are that the exchange offer not violate applicable law or applicable interpretations of the staff of the Securities and Exchange Commission and no injunction, order or decree has been issued which would prohibit, prevent or materially impair our ability to proceed with the exchange offer. We will exchange all outstanding notes that are validly tendered and not validly withdrawn for an equal principal amount of exchange notes that are registered under the Securities Act. Tenders of old notes may be withdrawn at any time prior to the expiration of the exchange offer. The terms of the registered notes to be issued in the exchange offer are substantially identical to the old notes that we issued on June 5, 2003, except for certain transfer restrictions, registration rights and liquidated damages provisions relating to the old notes that will not apply to the registered notes. We will not receive any cash proceeds from the exchange offer. ------------------- NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ------------------- THE DATE OF THIS PROSPECTUS IS , 2003 TABLE OF CONTENTS
PAGE ---- Summary..................................................... 1 Where You Can Find More Information......................... 9 Forward-Looking Statements.................................. 9 Incorporation by Reference.................................. 10 The Exchange Offer.......................................... 11 Capitalization.............................................. 18 Selected Financial and Operating Data....................... 20 Description of Certain Indebtedness and Other Obligations... 22 Description of the Registered Notes......................... 23 Federal Income Tax Considerations........................... 31 Plan of Distribution........................................ 32 Legal Matters............................................... 32 Experts..................................................... 32
------------------- Our logo which appears on the front and back cover page of this prospectus is registered in the United States Patent and Trademark Office. SUMMARY The following summary is qualified in its entirety by the more detailed information included elsewhere in this prospectus. Because this is a summary, it may not contain all of the information that may be important to you. Before making an investment decision, you should carefully read this entire prospectus. Unless otherwise expressly stated herein or the context otherwise requires, all references in this prospectus to 'Leucadia,' 'we,' 'us,' 'our,' 'our company' or 'the company' refer to Leucadia National Corporation, a New York corporation and its direct and indirect subsidiaries and all references to 'notes' refer to the old notes and the registered notes. THE EXCHANGE OFFER On June 5, 2003, we issued in a private placement $200 million in aggregate principal amount of our 7% Senior Notes due 2013, which we refer to as the 'old notes.' We refer to this private placement as the 'original note offering.' We entered into a registration rights agreement with the initial purchasers of the notes in which we agreed to deliver to you this prospectus. You are entitled to exchange your old notes in the exchange offer for registered notes with substantially identical terms. Unless you are a broker-dealer or unable to participate in the exchange offer, we believe that the notes to be issued in the exchange offer may be resold by you without compliance with the registration and prospectus delivery requirements of the Securities Act of 1933. You should read the discussions under the headings 'The Exchange Offer' and 'Description of the Registered Notes' for further information regarding the registered notes. OUR COMPANY We are a diversified holding company engaged in a variety of businesses, including telecommunications, banking and lending, manufacturing, real estate activities, winery operations, development of a copper mine and property and casualty reinsurance. We concentrate on return on investment and cash flow to build long-term shareholder value, rather than emphasizing volume or market share. Additionally, we continuously evaluate the retention and disposition of our existing operations and investigate possible acquisitions of new businesses in order to maximize shareholder value. In identifying possible acquisitions, we tend to seek assets and companies that are troubled or out of favor and, as a result, are selling substantially below the values we believe to be present. Our telecommunications operations consist of our 47.4% interest in WilTel Communications Group, Inc., which we acquired in the fourth quarter of 2002. WilTel is a publicly traded telecommunications company that owns or leases and operates a nationwide inter-city fiber-optic network, extended locally and globally, to provide Internet, data, voice and video services. WilTel's common stock is traded on the Nasdaq National Market (Symbol: WTEL). Our banking and lending operations have historically consisted of making instalment loans to niche markets primarily funded by customer banking deposits insured by the Federal Deposit Insurance Corporation. However, as a result of increased loss experience and declining profitability in its automobile lending program, the segment's largest program, we stopped originating new automobile loans in September 2001. In 2003, we ceased originating all other lending programs. We are considering our alternatives for our banking and lending operations, which could include selling or liquidating some or all of its loan portfolios, and outsourcing certain functions. Our manufacturing operations manufacture and market proprietary lightweight plastic netting used for a variety of purposes including, among other things, construction, agriculture, packaging, carpet padding, filtration and consumer products. Our domestic real estate operations include a mixture of commercial properties, residential land development projects and other unimproved land, all in various stages of development and all available for sale. During 2002, we sold our interest in Compagnie Fonciere FIDEI, our foreign real estate subsidiary, for total proceeds of 70.4 million Euros ($66.2 million) and recorded an increase to shareholders' equity of $12.1 million. 1 Our winery operations consist of Pine Ridge Winery in Napa Valley, California and Archery Summit in the Willamette Valley of Oregon. These wineries primarily produce and sell wines in the luxury segment of the premium table wine market. Our copper mine development operations consist of our 72.8% interest in MK Gold Company, a publicly traded company listed on the NASD OTC Bulletin Board (Symbol: MKAU). Our property and casualty reinsurance business is conducted through our common stock interest in Olympus Re Holdings, Ltd., a Bermuda reinsurance company primarily engaged in the property excess, marine and aviation reinsurance business. In July 2003, we sold a portion of our interest back to Olympus for cash proceeds of $79.5 million, which reduced our interest to approximately 16%. No material gain or loss will be recognized on the sale. RECENT DEVELOPMENTS On May 15, 2003, we sent a letter to the board of directors of WilTel containing our proposal to acquire pursuant to a registered exchange offer the WilTel common stock that we do not already beneficially own. Under the terms of the proposed exchange offer, WilTel stockholders would receive 0.3565 of our common shares in exchange for each share of WilTel common stock (representing a 30% premium to WilTel's stock price based on the closing price of our common shares ($38.65 per share) and WilTel's common stock ($10.60 per share) on May 14, 2003. We further informed WilTel's board of directors that if we were to acquire 90% or more of the outstanding WilTel common stock, we intend to effect a back-end merger at the same terms as offered in the exchange offer. If we acquire all the publicly held WilTel common stock, the former WilTel stockholders would own approximately 13.6% of our outstanding common shares. The terms of a stockholders agreement between us and WilTel restrict us from acquiring more than 49% of WilTel's common stock prior to October 15, 2004 unless the transaction is approved by a majority of the WilTel directors who are independent company directors (as defined in the stockholders agreement) or by the holders of a majority of the WilTel shares not held by us. On May 27, 2003, the board of directors of WilTel established a special committee to evaluate the terms of the proposed transaction. On June 19, 2003, WilTel issued a press release announcing that the special committee engaged JPMorgan as financial adviser and Gibson Dunn & Crutcher as legal adviser in evaluating the proposed transaction. This proposed transaction would be subject to various conditions, some of which would be beyond our control, and we cannot guarantee that the proposed exchange offer will be commenced or, that if commenced, when the transaction will close, if at all. In April 2003, we entered into an agreement with a third-party seller to acquire certain businesses of Integrated Health Services, Inc., a company undergoing reorganization proceedings under chapter 11 of the U.S. Bankruptcy Code. The businesses to be acquired are primarily engaged in the provision of physical, occupational, speech and respiratory therapy services and are operated by subsidiaries of Symphony Health Services, Inc. The purchase price is approximately $50 million, including expenses, and is subject to certain working capital and other adjustments. Closing of the transaction is subject to acquisition by the third-party seller of the Symphony businesses from Integrated Health Services, which is subject to bankruptcy court approval. ------------------- Our principal executive offices are located at 315 Park Avenue South, New York, New York 10010. Our telephone number is (212) 460-1900. 2 SUMMARY OF THE TERMS OF THE EXCHANGE OFFER The exchange offer relates to the exchange of up to $200 million aggregate principal amount of old notes for an equal aggregate principal amount of registered notes. On June 5, 2003, we issued and sold $200 million in aggregate principal amount of the old notes in a private placement. The form and terms of the registered notes are substantially the same as the form and terms of the old notes, except that the registered notes have been registered under the Securities Act of 1933 and will not bear legends restricting their transfer. We issued the old notes under an indenture which grants you a number of rights. The registered notes also will be issued under that indenture and you will have the same rights under the indenture as the holders of the old notes. See 'Description of the Registered Notes.' Registration Rights Agreement............. You are entitled under the registration rights agreement to exchange your old notes for registered notes with substantially identical terms. The exchange offer is intended to satisfy these rights. After the exchange offer is complete, except as set forth in the next paragraph, you will no longer be entitled to any exchange or registration rights with respect to your old notes. The registration rights agreement requires us to file a registration statement for a continuous offering in accordance with Rule 415 under the Securities Act for your benefit if you would not receive freely tradeable registered notes in the exchange offer or you are ineligible to participate in the exchange offer and indicate that you wish to have your old notes registered under the Securities Act. See 'The Exchange Offer -- Procedures for Tendering.' The Exchange Offer........................ We are offering to exchange $1,000 principal amount of 7% Senior Notes due 2013, which have been registered under the Securities Act, for each $1,000 principal amount of our unregistered 7% Senior Notes due 2013. In order to be exchanged, an old note must be properly tendered and accepted. All old notes that are validly tendered and not validly withdrawn will be exchanged. As of this date, there are $200 million aggregate principal amount of old notes outstanding. We will issue the registered notes promptly after the expiration of the exchange offer. Resales of the Registered Notes........... We believe that registered notes to be issued in the exchange offer may be offered for resale, resold and otherwise transferred by you without compliance with the registration and prospectus delivery provisions of the Securities Act if you meet the following conditions: (1) the registered notes are acquired by you in the ordinary course of your business; (2) you are not engaging in and do not intend to engage in a distribution of the registered notes; (3) you do not have an arrangement or understanding with any person to participate in the distribution of the registered notes; and (4) you are not an affiliate of ours, as that term is defined in Rule 405 under the Securities Act. Our belief is based on interpretations by the staff of the Commission, as set forth on no-action letters issued to third
3 parties unrelated to us. The staff has not considered this exchange offer in the context of a no-action letter, and we cannot assure you that the staff would make a similar determination with respect to this exchange offer. If you do not meet the above conditions, you may incur liability under the Securities Act if you transfer any registered note without delivering a prospectus meeting the requirements of the Securities Act. We do not assume or indemnify you against that liability. Each broker-dealer that is issued registered notes in the exchange offer for its own account in exchange for old notes which were acquired by that broker-dealer as a result of market-making activities or other trading activities must agree to deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of the registered notes. A broker- dealer may use this prospectus for an offer to resell or to otherwise transfer these registered notes. Expiration Date........................... The exchange offer will expire at 5:00 p.m., New York City time, on , 2003, unless we decide to extend the exchange offer. We do not intend to extend the exchange offer, although we reserve the right to do so. If we determine to extend the exchange offer, we do not intend to extend it beyond , 2003. Conditions to the Exchange Offer.......... The only conditions to completing the exchange offer are that the exchange offer not violate applicable law or any applicable interpretation of the staff of the Commission and no injunction, order or decree has been issued which would prohibit, prevent or materially impair our ability to proceed with the exchange offer. See 'The Exchange Offer -- Conditions.' Procedures for Tendering Old Notes Held in the Form of Book-Entry Interests........ The old notes were issued as global securities in fully registered form without coupons. Beneficial interests in the old notes which are held by direct or indirect participants in The Depository Trust Company are shown on, and transfers of the notes can be made only through, records maintained in book-entry form by DTC with respect to its participants. If you are a holder of an old note held in the form of a book-entry interest and you wish to tender your old note for exchange pursuant to the exchange offer, you must transmit to JPMorgan Chase Bank, as exchange agent, on or prior to the expiration of the exchange offer either: a written or facsimile copy of a properly completed and executed letter of transmittal and all other required documents to the address set forth on the cover page of the letter of transmittal; or a computer-generated message transmitted by means of DTC's Automated Tender Offer Program system and forming a part of a confirmation of book-entry transfer in which you acknowledge and agree to be bound by the terms of the letter of transmittal.
4 The exchange agent must also receive on or prior to the expiration of the exchange offer either: a timely confirmation of book-entry transfer of your old notes into the exchange agent's account at DTC, in accordance with the procedure for book-entry transfers described in this prospectus under the heading 'The Exchange Offer -- Book-Entry Transfer;' or the documents necessary for compliance with the guaranteed delivery procedures described below. A letter of transmittal accompanies this prospectus. By executing the letter of transmittal or delivering a computer-generated message through DTC's Automated Tender Offer Program system, you will represent to us that, among other things: the registered notes to be acquired by you in the exchange offer are being acquired in the ordinary course of your business; you are not engaging in and do not intend to engage in a distribution of the registered notes; you do not have an arrangement or understanding with any person to participate in the distribution of the registered notes; and you are not our affiliate. Procedures for Tendering Certificated Old Notes................................... If you are a holder of book-entry interests in the old notes, you are entitled to receive, in limited circumstances, in exchange for your book-entry interests, certificated notes which are in equal principal amounts to your book-entry interests. See 'Description of the Registered Notes -- Form of Registered Notes.' No certificated notes are issued and outstanding as of the date of this prospectus. If you acquire certificated old notes prior to the expiration of the exchange offer, you must tender your certificated old notes in accordance with the procedures described in this prospectus under the heading 'The Exchange Offer -- Procedures for Tendering -- Certificated Old Notes.' Special Procedures for Beneficial Owners.................................. If you are the beneficial owner of old notes and they are registered in the name of a broker, dealer, commercial bank, trust company or other nominee, and you wish to tender your old notes, you should promptly contact the person in whose name your old notes are registered and instruct that person to tender on your behalf. If you wish to tender on your own behalf, you must, prior to completing and executing the letter of transmittal and delivering your old notes, either make appropriate arrangements to register ownership of the old notes in your name or obtain a properly completed bond power from the person in whose name your old notes are registered. The transfer of registered ownership may take considerable time. See 'The Exchange Offer -- Procedures for Tendering -- Procedures Applicable to All Holders.' Guaranteed Delivery Procedures............ If you wish to tender your old notes and: (1) they are not immediately available;
5 (2) time will not permit your old notes or other required documents to reach the exchange agent before the expiration of the exchange offer; or (3) you cannot complete the procedure for book-entry transfer on a timely basis, you may tender your old notes in accordance with the guaranteed delivery procedures set forth in 'The Exchange Offer -- Procedures for Tendering -- Guaranteed Delivery Procedures.' Acceptance of Old Notes and Delivery of Registered Notes........................ Except under the circumstances described above under 'Conditions to the Exchange Offer,' we will accept for exchange any and all old notes which are properly tendered in the exchange offer prior to 5:00 p.m., New York City time, on the expiration date. The registered notes to be issued to you in the exchange offer will be delivered promptly following the expiration date. See 'The Exchange Offer -- Terms of the Exchange Offer.' Withdrawal................................ You may withdraw the tender of your old notes at any time prior to 5:00 p.m., New York City time, on the expiration date. We will return to you any old notes not accepted for exchange for any reason without expense to you as promptly as we can after the expiration or termination of the exchange offer. Exchange Agent............................ The Bank of New York is serving as the exchange agent in connection with the exchange offer. Consequences of Failure to Exchange....... If you do not participate in the exchange offer, upon completion of the exchange offer, the liquidity of the market for your old notes could be adversely affected. See 'The Exchange Offer -- Consequences of Failure to Exchange.' Federal Income Tax Consequences........... The exchange of old notes will not be a taxable event for federal income tax purposes. See 'Federal Income Tax Considerations.'
6 SUMMARY OF THE TERMS OF THE REGISTERED NOTES Issuer.................................... Leucadia National Corporation. Offering.................................. $200,000,000 aggregate principal amount 7% Senior Notes due 2013. Maturity Date............................. August 15, 2013. Interest Rate............................. We will pay interest on the notes at an annual rate of 7%. Interest Payment Dates.................... We will make interest payments on the notes semiannually, on each February 15 and August 15, beginning on August 15, 2003. Ranking................................... The notes will be our senior unsecured obligations and will rank equally in right of payment with all of our existing and future senior unsecured indebtedness and senior in right to all of our existing and future subordinated indebtedness. The notes will be effectively subordinated to all existing and future indebtedness of our subsidiaries. Had the notes been issued as of March 31, 2003, they would have been effectively subordinated to approximately $530 million of indebtedness and other liabilities of our subsidiaries, including trade payables but excluding intercompany obligations. Optional Redemption....................... The notes are not redeemable at our option prior to maturity. Mandatory Redemption...................... The notes are not subject to sinking fund payments. Change of Control Offer................... If we experience a change of control, each holder of notes will have the right to sell to us all or a portion of such holder's notes at 101% of their principal amount, plus accrued but unpaid interest, if any, to the date of repurchase. A change of control will occur at the time Ian M. Cumming, our chairman of the board, and Joseph S. Steinberg, a director and our president, cease to beneficially own, in the aggregate, a specified percentage of our outstanding common shares, coupled in various circumstances with the notes being rated below investment grade. See 'Description of the Registered Notes -- Repurchase at Option of Holders Upon a Change of Control.' 'Restrictive Covenants..................... The indenture governing the notes contains covenants that, among other things, limit: our ability to incur additional indebtedness; our ability to incur liens; our ability to enter into sale-leaseback transactions; our ability to enter into transactions with affiliates; the ability of certain of our subsidiaries to incur debt; and our ability to consummate certain mergers. These covenants are subject to a number of important exceptions described below in 'Description of the Registered Notes.' Registration Rights; Liquidated Damages... In connection with the offering of the old notes, we agreed to give you the opportunity to exchange the notes for notes with substantially identical terms but that may be publicly traded. We have agreed to:
7 file a registration statement for the exchange of the notes within 120 days after the issue date of the old notes; cause the registration statement to become effective within 180 days after the issue date of the old notes; and consummate the exchange offer within 45 days after the registration statement has become effective. In addition, we have agreed, in some circumstances, to file a 'shelf registration statement' that would allow some or all of the notes to be offered to the public. If we do not comply with the foregoing obligations under the registration rights agreement, we will be required to pay liquidated damages to holders of notes. Use of Proceeds........................... We will not receive any cash proceeds from the exchange offer.
8 WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and current reports, proxy statements and other information with the Securities and Exchange Commission. You may read and copy any document we file at the SEC's public reference rooms. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms. Our SEC filings are also available to the public at the SEC's web site at http://www.sec.gov. Our common shares, 7 3/4% Senior Notes due 2013, 8 1/4% Senior Subordinated Notes due 2005 and 7 7/8% Senior Subordinated Notes due 2006 are listed on the New York Stock Exchange. Our reports, proxy statements and other information can also be inspected at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York 10005. We have filed with the Commission a Registration Statement on Form S-4 with respect to the registered notes. This prospectus, which is a part of the registration statement, omits some of the information included in the registration statement. Statements made in this prospectus as to the contents of any contract, agreement or other document are not necessarily complete. With respect to each contract, agreement or other document, we refer you to the relevant exhibit for a more complete description of the matter involved, and each statement is deemed qualified in its entirety to the reference. FORWARD-LOOKING STATEMENTS Some of the statements contained in or incorporated by reference in this prospectus contain forward-looking statements within the meaning of the federal securities laws. These forward-looking statements are made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements may relate, but are not limited, to projections of revenues, income or loss, capital expenditures, plans for growth and future operations, competition and regulation, as well as assumptions relating to the foregoing. Forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted or quantified. The words 'estimates,' 'expects,' 'anticipates,' 'believes,' 'plans,' 'intends' and variations of these words and similar expressions are intended to identify forward-looking statements that involve risks and uncertainties. Future events and actual results could differ materially from those set forth in, contemplated by or underlying the forward-looking statements. The factors that could cause actual results to differ materially from those suggested by any of these statements include, but are not limited to, those discussed or identified from time to time in our public filings, including: general economic and market conditions, prevailing interest rate levels or foreign currency fluctuations; reliance on key management personnel; changes in foreign and domestic laws, regulations and taxes; changes in competition and pricing environments; regional or general changes in asset valuation; the occurrence of significant natural disasters, the inability to reinsure certain risks economically, increased competition in the reinsurance markets and the adequacy of loss and loss adjustment expense reserves; weather related conditions that may affect our operations or investments; changes in U.S. real estate markets, including the commercial and vacation markets in Hawaii; increased competition in the luxury segment of the premium table wine market; adverse economic, political or environmental developments in Spain that could delay or preclude the issuance of permits necessary to obtain mining rights for our cooper mining project or could result in increased costs of bringing the project to completion, increased costs in financing the development of the project and decreases in world wide copper prices; increased competition in the international and domestic plastics market and increased raw material costs; 9 increased default rates and decreased value of assets pledged to us; further regulatory action by the Office of the Comptroller of the Currency; any deterioration in The FINOVA Group Inc.'s business and operations, in FINOVA Capital Corporation's ability to repay the loan from Berkadia LLC and further deterioration in the value of the assets pledged by FINOVA and FINOVA Capital in connection with the Berkadia loan; deterioration in WilTel Communications Group, Inc.'s business and operations and WilTel's ability to generate operating profits and positive cash flows, WilTel's ability to retain key customers and suppliers, regulatory changes in the telecommunications markets and increased competition from reorganized telecommunication companies; our ability to consummate the acquisition of the shares of WilTel that we do not already own on the terms proposed by us; and changes in the composition of our assets and liabilities through acquisitions or divestitures. WE DO NOT HAVE ANY OBLIGATION TO UPDATE PUBLICLY ANY FORWARD-LOOKING STATEMENTS, WHETHER AS A RESULT OF NEW INFORMATION, FUTURE EVENTS OR OTHERWISE, EXCEPT AS REQUIRED BY LAW. INCORPORATION BY REFERENCE The Commission allows us to 'incorporate by reference' information that we file with it, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus. This prospectus and the information that we file later with the Commission may update and supersede the information we incorporate by reference. We incorporate by reference the documents listed below and any future filings made with the Commission under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 by us until the exchange offer is complete: our Annual Report on Form 10-K for the fiscal year ended December 31, 2002; our Quarterly Report on Form 10-Q for the quarter ended March 31, 2003; our Current Reports on Form 8-K dated May 12, 2003, May 15, 2003, June 3, 2003, June 4, 2003 and June 11, 2003; and all documents that we file with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until all notes have been sold. You may also request a copy of these filings, at no cost, by writing or telephoning us at the following: Leucadia National Corporation 315 Park Avenue South New York, New York 10010 Attention: Corporation Secretary Telephone: (212) 460-1900 In order to obtain timely delivery, holders must request the information no later than five business days before the expiration date of the exchange offer. 10 THE EXCHANGE OFFER PURPOSE AND EFFECT We issued the old notes on June 5, 2003 in a private placement to a limited number of qualified institutional buyers, as defined under the Securities Act, and to a limited number of persons outside the United States. In connection with this issuance, we entered into the indenture and the registration rights agreement. These agreements require that we file a registration statement under the Securities Act with respect to the registered notes to be issued in the exchange offer and, upon the effectiveness of the registration statement, offer to you the opportunity to exchange your old notes for a like principal amount of registered notes. These registered notes will be issued without a restrictive legend and, except as set forth below, may be reoffered and resold by you without registration under the Securities Act. After we complete the exchange offer, our obligations with respect to the registration of the old notes and the registered notes will terminate, except as provided in the last paragraph of this section. A copy of the indenture relating to the notes and the registration rights agreement have been filed as exhibits to the registration statement of which this prospectus is a part. As a result of the filing and the effectiveness of the registration statement, assuming we complete the exchange offer within 30 business days of the date that the registration statement is declared effective, we will not be required to pay any liquidated damages. Based on an interpretation by the staff of the Commission set forth in no-action letters issued to third parties, if you are not our 'affiliate' within the meaning of Rule 405 under the Securities Act or a broker-dealer referred to in the next paragraph, we believe that registered notes to be issued to you in the exchange offer may be offered for resale, resold and otherwise transferred by you, without compliance with the registration and prospectus delivery provisions of the Securities Act. This interpretation, however, is based on your representation to us that: (1) the registered notes to be issued to you in the exchange offer are acquired in the ordinary course of your business; (2) you are not engaging in and do not intend to engage in a distribution of the registered notes to be issued to you in the exchange offer; and (3) you have no arrangement or understanding with any person to participate in the distribution of the registered notes to be issued to you in the exchange offer. If you tender your old notes in the exchange offer for the purpose of participating in a distribution of the registered notes to be issued to you in the exchange offer, you cannot rely on this interpretation by the staff of the Commission. Under those circumstances, you must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction. Each broker-dealer that receives registered notes in the exchange offer for its own account in exchange for old notes that were acquired by the broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of those registered notes. See 'Plan of Distribution.' If you will not receive freely tradeable registered notes in the exchange offer or are not eligible to participate in the exchange offer, you can elect, by indicating on the letter of transmittal and providing additional necessary information, to have your old notes registered in a 'shelf' registration statement on an appropriate form pursuant to Rule 415 under the Securities Act. If we are obligated to file a shelf registration statement, we will be required to keep the shelf registration statement effective for a period of 180 days from the date the shelf registration statement is declared effective by the Commission or a shorter period that will terminate when all of the old notes covered by the shelf registration statement have been sold pursuant to the shelf registration statement. Other than as set forth in this paragraph, you will not have the right to require us to register your old notes under the Securities Act. See ' -- Procedures for Tendering' below. CONSEQUENCES OF FAILURE TO EXCHANGE After we complete the exchange offer, if you have not tendered your old notes, you will not have any further registration rights, except as set forth above. Your old notes will continue to be subject to 11 restrictions on transfer. Therefore, the liquidity of the market for your old notes could be adversely affected upon completion of the exchange offer if you do not participate in the exchange offer. TERMS OF THE EXCHANGE OFFER Upon the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal, we will accept any and all old notes validly tendered and not withdrawn prior to 5:00 p.m., New York City time, on the expiration date. We will issue $1,000 principal amount of registered notes in exchange for each $1,000 principal amount of old notes accepted in the exchange offer. You may tender some or all of your old notes pursuant to the exchange offer. However, old notes may be tendered only in integral multiples of $1,000 principal amount. The form and terms of the registered notes are substantially the same as the form and terms of the old notes, except that the registered notes to be issued in the exchange offer have been registered under the Securities Act and will not bear legends restricting their transfer. The registered notes will be issued pursuant to, and entitled to the benefits of, the indenture. The indenture also governs the old notes. The registered notes and the old notes will be deemed one issue of notes under the indenture. As of the date of this prospectus, $200 million in aggregate principal amount of old notes were outstanding. This prospectus, together with the letter of transmittal, is being sent to all registered holders and to others believed to have beneficial interests in the old notes. You do not have any appraisal or dissenters' rights in connection with the exchange offer under the Business Corporation Law of the State of New York or the indenture. We intend to conduct the exchange offer in accordance with the applicable requirements of the Exchange Act and the rules and regulations of the Commission promulgated under the Exchange Act. We will be deemed to have accepted validly tendered outstanding notes when, as, and if we have given oral or written notice of our acceptance to the exchange agent. The exchange agent will act as our agent for the tendering holders for the purpose of receiving the registered notes from us. If we do not accept any tendered notes because of an invalid tender, the occurrence of other events set forth in this prospectus or otherwise, we will return certificates for any unaccepted old notes, without expense, to the tendering holder as promptly as practicable after the expiration date. You will not be required to pay brokerage commissions or fees or, except as set forth below under ' -- Transfer Taxes,' transfer taxes with respect to the exchange of your old notes in the exchange offer. We will pay all charges and expenses, other than applicable taxes, in connection with the exchange offer. See ' -- Fees and Expenses' below. EXPIRATION DATE; AMENDMENTS The exchange offer will expire at 5:00 p.m., New York City time, on *, 2003, unless we determine, in our sole discretion, to extend the exchange offer, in which case, it will expire at the later date and time to which it is extended. We do not intend to extend the exchange offer, although we reserve the right to do so. If we determine to extend the exchange offer, we do not intend to extend it beyond **, 2003. If we extend the exchange offer, we will give oral or written notice of the extension to the exchange agent and give each registered holder notice by means of a press release or other public announcement of any extension prior to 9:00 a.m., New York City time, on the next business day after the scheduled expiration date. We also reserve the right, in our sole discretion, (1) to delay accepting any old notes or, if any of the conditions set forth below under ' -- Conditions' have not been satisfied or waived, to terminate the exchange offer by giving oral or written notice of the delay or termination to the exchange agent, or (2) to amend the terms of the exchange offer in any manner, by complying with Rule 14e-l(d) under the Exchange Act to the extent that rule applies. - --------- * This date may not be less than 20 business days from the commencement of the offer. ** This date may not be more than 45 business days from the commencement of the offer. 12 We acknowledge and undertake to comply with the provisions of Rule 14e-l(c) under the Exchange Act, which requires us to pay the consideration offered, or return the old notes surrendered for exchange, promptly after the termination or withdrawal of the exchange offer. We will notify you as promptly as we can of any extension, termination or amendment. PROCEDURES FOR TENDERING Book-Entry Interests The old notes were issued as global securities in fully registered form without interest coupons. Beneficial interests in the global securities, held by direct or indirect participants in DTC, are shown on, and transfers of these interests are effected only through, records maintained in book-entry form by DTC with respect to its participants. If you hold your old notes in the form of book-entry interests and you wish to tender your old notes for exchange pursuant to the exchange offer, you must transmit to the exchange agent on or prior to the expiration date either: (1) a written or facsimile copy of a properly completed and duly executed letter of transmittal, including all other documents required by the letter of transmittal, to the exchange agent at the address set forth on the cover page of the letter of transmittal; or (2) a computer-generated message transmitted by means of DTC's Automated Tender Offer Program system and received by the exchange agent and forming a part of a confirmation of book-entry transfer, in which you acknowledge and agree to be bound by the terms of the letter of transmittal. In addition, in order to deliver old notes held in the form of book-entry interests: (1) a timely confirmation of book-entry transfer of the notes into the exchange agent's account at DTC pursuant to the procedure for book-entry transfers described below under ' -- Book-Entry Transfer' must be received by the exchange agent prior to the expiration date; or (2) you must comply with the guaranteed delivery procedures described below. THE METHOD OF DELIVERY OF OLD NOTES AND THE LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS TO THE EXCHANGE AGENT IS AT YOUR ELECTION AND RISK. INSTEAD OF DELIVERY BY MAIL, WE RECOMMEND THAT YOU USE AN OVERNIGHT OR HAND DELIVERY SERVICE. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE DELIVERY TO THE EXCHANGE AGENT BEFORE THE EXPIRATION DATE. YOU SHOULD NOT SEND THE LETTER OF TRANSMITTAL OR OLD NOTES TO US. YOU MAY REQUEST YOUR BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY, OR NOMINEE TO EFFECT THE ABOVE TRANSACTIONS FOR YOU. Certificated Old Notes Only registered holders of certificated old notes may tender those notes in the exchange offer. If your old notes are certificated notes and you wish to tender those notes for exchange pursuant to the exchange offer, you must transmit to the exchange agent on or prior to the expiration date, a written or facsimile copy of a properly completed and duly executed letter of transmittal, including all other required documents, to the address set forth below under ' -- Exchange Agent.' In addition, in order to validly tender your certificated old notes: (1) the certificates representing your old notes must be received by the exchange agent prior to the expiration date; or (2) you must comply with the guaranteed delivery procedures described below. PROCEDURES APPLICABLE TO ALL HOLDERS If you tender an old note and you do not withdraw the tender prior to the expiration date, you will have made an agreement with us in accordance with the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal. If your old notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and you wish to tender your notes, you should contact the registered holder promptly and 13 instruct the registered holder to tender on your behalf. If you wish to tender on your own behalf, you must, prior to completing and executing the letter of transmittal and delivering your old notes, either make appropriate arrangements to register ownership of the old notes in your name or obtain a properly completed bond power from the registered holder. The transfer of registered ownership may take considerable time. Signatures on a letter of transmittal or a notice of withdrawal must be guaranteed by an eligible institution unless: (1) old notes tendered in the exchange offer are tendered either (A) by a registered holder who has not completed the box entitled 'Special Registration Instructions' or 'Special Delivery Instructions' on the letter of transmittal or (B) for the account of an eligible institution; and (2) the box entitled 'Special Registration Instructions' on the letter of transmittal has not been completed. If signatures on a letter of transmittal or a notice of withdrawal are required to be guaranteed, the guarantee must be by a financial institution, which includes most banks, savings and loan associations and brokerage houses, that is a participant in the Securities Transfer Agents Medallion Program, the New York Stock Exchange Medallion Program or the Stock Exchanges Medallion Program. If the letter of transmittal is signed by a person other than you, your old notes must be endorsed or accompanied by a properly completed bond power and signed by you as your name appears on those old notes. If the letter of transmittal or any old notes or bond powers are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations, or others acting in a fiduciary or representative capacity, those persons should so indicate when signing. Unless we waive this requirement, in this instance you must submit with the letter of transmittal proper evidence satisfactory to us of their authority to act on your behalf. We will determine, in our sole discretion, all questions regarding the validity, form, eligibility, including time of receipt, acceptance and withdrawal of tendered old notes. This determination will be final and binding. We reserve the absolute right to reject any and all old notes not properly tendered or any old notes our acceptance of which would, in the opinion of our counsel, be unlawful. We also reserve the right to waive any defects, irregularities or conditions of tender as to particular old notes. Our interpretation of the terms and conditions of the exchange offer, including the instructions in the letter of transmittal, will be final and binding on all parties. You must cure any defects or irregularities in connection with tenders of your old notes within the time period we will determine unless we waive that defect or irregularity. Although we intend to notify you of defects or irregularities with respect to your tender of old notes, neither we, the exchange agent nor any other person will incur any liability for failure to give this notification. Your tender will not be deemed to have been made and your notes will be returned to you if: (1) you improperly tender your old notes; (2) you have not cured any defects or irregularities in your tender; and (3) we have not waived those defects, irregularities or improper tender. The exchange agent will return your notes, unless otherwise provided in the letter of transmittal, as soon as practicable following the expiration of the exchange offer. In addition, we reserve the right in our sole discretion to: (1) purchase or make offers for, or offer registered notes for, any old notes that remain outstanding subsequent to the expiration of the exchange offer; (2) terminate the exchange offer; and (3) to the extent permitted by applicable law, purchase notes in the open market, in privately negotiated transactions or otherwise. The terms of any of these purchases or offers could differ from the terms of the exchange offer. 14 By tendering, you will represent to us that, among other things: (1) the registered notes to be acquired by you in the exchange offer are being acquired in the ordinary course of your business; (2) you are not engaging in and do not intend to engage in a distribution of the registered notes to be acquired by you in the exchange offer; (3) you do not have an arrangement or understanding with any person to participate in the distribution of the registered notes to be acquired by you in the exchange offer; and (4) you are not our 'affiliate,' as defined under Rule 405 of the Securities Act. In all cases, issuance of registered notes for old notes that are accepted for exchange in the exchange offer will be made only after timely receipt by the exchange agent of certificates for your old notes or a timely book-entry confirmation of your old notes into the exchange agent's account at DTC, a properly completed and duly executed letter of transmittal, or a computer-generated message instead of the letter of transmittal, and all other required documents. If any tendered old notes are not accepted for any reason set forth in the terms and conditions of the exchange offer or if old notes are submitted for a greater principal amount than you desire to exchange, the unaccepted or non-exchanged old notes, or old notes in substitution therefor, will be returned without expense to you. In addition, in the case of old notes, tendered by book-entry transfer into the exchange agent's account at DTC pursuant to the book-entry transfer procedures described below, the non-exchanged old notes will be credited to your account maintained with DTC, as promptly as practicable after the expiration or termination of the exchange offer. Guaranteed Delivery Procedures If you desire to tender your old notes and your old notes are not immediately available or one of the situations described in the immediately preceding paragraph occurs, you may tender if: (1) you tender through an eligible financial institution; (2) on or prior to 5:00 p.m., New York City time, on the expiration date, the exchange agent receives from an eligible institution, a written or facsimile copy of a properly completed and duly executed letter of transmittal and notice of guaranteed delivery, substantially in the form provided by us; and (3) the certificates for all certificated old notes, in proper form for transfer, or a book-entry confirmation, and all other documents required by the letter of transmittal, are received by the exchange agent within three New York Stock Exchange trading days after the date of execution of the notice of guaranteed delivery. The notice of guaranteed delivery may be sent by facsimile transmission, mail or hand delivery. The notice of guaranteed delivery must set forth: (1) your name and address; (2) the amount of old notes you are tendering; and (3) a statement that your tender is being made by the notice of guaranteed delivery and that you guarantee that within three New York Stock Exchange trading days after the execution of the notice of guaranteed delivery, the eligible institution will deliver the following documents to the exchange agent: (A) the certificates for all certificated old notes being tendered, in proper form for transfer or a book-entry confirmation of tender; (B) a written or facsimile copy of the letter of transmittal, or a book-entry confirmation instead of the letter of transmittal; and (C) any other documents required by the letter of transmittal. BOOK-ENTRY TRANSFER The exchange agent will establish an account with respect to the book-entry interests at DTC for purposes of the exchange offer promptly after the date of this prospectus. You must deliver your book-entry interest by book-entry transfer to the account maintained by the exchange agent at DTC. Any 15 financial institution that is a participant in DTC's systems may make book-entry delivery of book-entry interests by causing DTC to transfer the book-entry interests into the exchange agent's account at DTC in accordance with DTC's procedures for transfer. If one of the following situations occur: (1) you cannot deliver a book-entry confirmation of book-entry delivery of your book-entry interests into the exchange agent's account at DTC; or (2) you cannot deliver all other documents required by the letter of transmittal to the exchange agent prior to the expiration date, then you must tender your book-entry interests according to the guaranteed delivery procedures discussed above. WITHDRAWAL RIGHTS You may withdraw tenders of your old notes at any time prior to 5:00 p.m., New York City time, on the expiration date. For your withdrawal to be effective, the exchange agent must receive a written or facsimile transmission notice of withdrawal at its address set forth below under ' -- Exchange Agent' prior to 5:00 p.m., New York City time, on the expiration date. The notice of withdrawal must: (1) state your name; (2) identify the specific old notes to be withdrawn, including the certificate number or numbers and the principal amount of withdrawn notes; (3) be signed by you in the same manner as you signed the letter of transmittal when you tendered your old notes, including any required signature guarantees or be accompanied by documents of transfer sufficient for the exchange agent to register the transfer of the old notes into your name; and (4) specify the name in which the old notes are to be registered, if different from yours. We will determine all questions regarding the validity, form and eligibility, including time of receipt, of withdrawal notices. Our determination will be final and binding on all parties. Any old notes withdrawn will be deemed not to have been validly tendered for exchange for purposes of the exchange offer. Any old notes which have been tendered for exchange but which are not exchanged for any reason will be returned to you without cost as soon as practicable after withdrawal, rejection of tender or termination of the exchange offer. Properly withdrawn old notes may be retendered by following one of the procedures described under ' -- Procedures for Tendering' above at any time on or prior to 5:00 p.m., New York City time, on the expiration date. CONDITIONS Notwithstanding any other provision of the exchange offer and subject to our obligations under the registration rights agreement, we will not be required to accept for exchange, or to issue registered notes in exchange for, any old notes and may terminate or amend the exchange offer, if at any time before the acceptance of any old notes for exchange any of the following events occur: (1) any injunction, order or decree has been issued by any court or any governmental agency that would prohibit, prevent or otherwise materially impair our ability to proceed with the exchange offer; or (2) the exchange offer violates any applicable law or any applicable interpretation of the staff of the Commission. These conditions are for our sole benefit and we may assert them regardless of the circumstances giving rise to them, subject to applicable law. We also may waive in whole or in part at any time and from time to time any particular condition in our sole discretion. If we waive a condition, we may be required in order to comply with applicable securities laws, to extend the expiration date of the exchange offer. Our failure at any time to exercise any of the foregoing rights will not be deemed a waiver of these 16 rights and these rights will be deemed ongoing rights which may be asserted at any time and from time to time. In addition, we will not accept for exchange any old notes tendered, and no registered notes will be issued in exchange for any of those old notes, if at the time the notes are tendered any stop order is threatened by the Commission or in effect with respect to the registration statement of which this prospectus is a part or the qualification of the indenture under the Trust Indenture Act of 1939. The exchange offer is not conditioned on any minimum principal amount of old notes being tendered for exchange. EXCHANGE AGENT We have appointed JPMorgan Chase Bank as exchange agent for the exchange offer. Questions, requests for assistance and requests for additional copies of the prospectus, the letter of transmittal and other related documents should be directed to the exchange agent addressed as follows: By Regular Mail: JPMorgan Chase Bank ITS Bond Events 2001 Bryan Street, 9th Floor Dallas, TX 75201 By Registered Mail, Hand or by Overnight Courier: JPMorgan Chase Bank ITS Bond Events 2001 Bryan Street, 9th Floor Dallas, TX 75201 Attention: Frank Ivins By Facsimile: (214) 468-6494 By Telephone: (214) 468-6464 Attention: Frank Ivins The exchange agent also acts as trustee under the indenture. FEES AND EXPENSES We will not pay brokers, dealers, or others soliciting acceptances of the exchange offer. The principal solicitation is being made by mail. Additional solicitations, however, may be made in person or by telephone by our officers and employees. We will pay the estimated cash expenses to be incurred in connection with the exchange offer. These are estimated in the aggregate to be approximately $25,000 which includes fees and expenses of the exchange agent, accounting, legal, printing and related fees and expenses. TRANSFER TAXES You will not be obligated to pay any transfer taxes in connection with a tender of your old notes for exchange unless you instruct us to register registered notes in the name of, or request that old notes not tendered or not accepted in the exchange offer be returned to, a person other than the registered tendering holder, in which event the registered tendering holder will be responsible for the payment of any applicable transfer tax. ACCOUNTING TREATMENT We will not recognize any gain or loss for accounting purposes upon the consummation of the exchange offer. We will amortize the expense of the exchange offer over the term of the registered notes under accounting principles generally accepted in the United States of America. 17 CAPITALIZATION The following table sets forth our unaudited consolidated capitalization as of March 31, 2003 on an historical basis and as adjusted to give effect to the offering of the old notes. You should read the table below in conjunction with the information set forth under 'Management's Discussion and Analysis of Financial Condition and Results of Operations' and our consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2002 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2003 incorporated by reference into this prospectus.
AS OF MARCH 31, 2003 ------------------------ ACTUAL AS ADJUSTED ------ ----------- (DOLLARS IN THOUSANDS) Long-term debt (a)(b)(c): Bank credit facility.................................... $ -- $ -- 7% Senior Notes due 2013, less debt discount of $776.... -- 199,224 7 3/4% Senior Notes due 2013, less debt discount of $519.................................................. 99,481 99,481 Industrial Revenue Bonds (with variable interest)....... 9,815 9,815 Aircraft financing...................................... 49,260 49,260 Other due 2003 through 2016 with a weighted average interest rate of 7.3%................................. 36,857 36,857 8 1/4% Senior Subordinated Notes due 2005............... 19,101 19,101 7 7/8% Senior Subordinated Notes due 2006, less debt discount of $40............................. 21,636 21,636 ---------- ---------- Total long-term debt including current maturities... 236,150 435,374 ---------- ---------- Company-obligated mandatorily redeemable preferred securities of subsidiary trust holding solely subordinated debt securities of the Company (c)....... 98,200 98,200 ---------- ---------- Shareholders' equity (d): Common shares, par value $1 per share, authorized 150,000,000 shares; 59,623,292 shares issued and outstanding, after deducting 58,865,579 shares held in treasury........................................... 59,623 59,623 Additional paid-in capital.............................. 200,595 200,595 Accumulated other comprehensive income.................. 70,186 70,186 Retained earnings....................................... 1,204,678 1,204,678 ---------- ---------- Total shareholders' equity.......................... 1,535,082 1,535,082 ---------- ---------- Total........................................... $1,869,432 $2,068,656 ---------- ---------- ---------- ----------
- --------- (a) Excludes customer banking deposits ('Deposits') of $306.5 million at March 31, 2003. For information with respect to the interest rates, priorities and restrictions relating to outstanding long-term debt, see Note 9 of Notes to Consolidated Financial Statements contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2002. (b) In January 2003, the FASB issued FASB Interpretation No. 46 ('FIN 46'), which addresses consolidation of variable interest entities, which are entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. FIN 46 is effective immediately to variable interest entities created after January 31, 2003 and to variable interest entities in which an enterprise obtains an interest after that date. FIN 46 applies in the third quarter of 2003 for variable interest entities in which a variable interest was acquired before February 1, 2003. FIN 46 may be applied prospectively with a cumulative effect adjustment as of the date on which it is first applied or by restating previously issued financial statements with a cumulative effect adjustment as of the beginning of the first year restated. We are currently reviewing the impact of the
(footnotes continued on next page) 18 (footnotes continued from previous page) implementation of FIN 46, which may result in our consolidation of certain entities that are not currently consolidated and, therefore, not reflected in the table above. (c) For information with respect to the interest rate on and other matters relating to outstanding trust preferred securities, see Note 10 of Notes to Consolidated Financial Statements contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2002. In May 2003, the FASB issued FASB Statement No. 150, which will require us to classify these securities as liabilities in the third quarter of 2003. (d) For information with respect to stock options and contingent obligations, see Notes 11 and 16 of Notes to Consolidated Financial Statements contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2002.
19 SELECTED FINANCIAL AND OPERATING DATA The historical financial and operating data below as of and for each of the years in the five year period ended December 31, 2002 are derived from our Annual Report on Form 10-K for those years. The historical financial and operating data below as of and for each of the three month periods ended March 31, 2003 and 2002 are derived from our unaudited Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2003. The financial information below are qualified in their entirety by reference to, and should be read in conjunction with the historical financial statements and related notes and management's discussion and analysis of financial condition and results of operations contained in our annual, quarterly and other reports, which are incorporated by reference herein.
THREE MONTHS ENDED MARCH 31, YEAR ENDED DECEMBER 31, ------------------- ---------------------------------------------------- 2003 2002 2002 2001 2000 1999 1998 ---- ---- ---- ---- ---- ---- ---- (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) SELECTED INCOME STATEMENT DATA: Revenues (a).................................. $ 56,899 $ 57,567 $241,805 $374,161 $493,408 $460,814 $199,070 Expenses...................................... 61,100 68,347 283,330 301,079 292,105 226,171 183,968 Income (loss) from continuing operations before income taxes, minority expense of trust preferred securities and equity in income (losses) of associated companies...... (4,201) (10,780) (41,525) 73,082 201,303 234,643 15,102 Income (loss) from continuing operations before minority expense of trust preferred securities and equity in income (losses) of associated companies (b)..................... (2,715) (7,161) 103,340 84,423 133,087 195,175 45,814 Minority expense of trust preferred securities, net of taxes..................... (1,381) (1,381) (5,521) (5,521) (5,521) (5,521) (8,248) Equity in income (losses) of associated companies, net of taxes...................... (9,690) 19,845 54,712 (15,974) 19,040 (1,906) 15,138 Income (loss) from continuing operations...... (13,786) 11,303 152,531 62,928 146,606 187,748 52,704 Income (loss) from discontinued operations, including gain (loss) on disposal, net of taxes........................................ -- 1,440 9,092 (70,847) (30,598) 27,294 1,639 Cumulative effect of a change in accounting principle.................................... -- -- -- 411 -- -- -- Net income (loss).................... (13,786) 12,743 161,623 (7,508) 116,008 215,042 54,343 Ratio of earnings to fixed charges: (c) Excluding interest on Deposits............. 2.77x 3.72x .69x 6.25x 6.99x 7.22x 2.20x Including interest on Deposits............. 2.23x 2.49x .81x 3.42x 4.32x 5.66x 1.97x Per share: Basic earnings (loss) per common share: Income (loss) from continuing operations... $ (.23) $ .20 $ 2.74 $ 1.13 $ 2.64 $ 3.16 $ .83 Income (loss) from discontinued operations, including gain (loss) on disposal........ -- .03 .16 (1.28) (.55) .46 .03 Cumulative effect of a change in accounting principle................................ -- -- -- .01 -- -- -- -------- -------- -------- -------- -------- -------- -------- Net income (loss).................... $ (.23) $ .23 $ 2.90 $ (.14) $ 2.09 $ 3.62 $ .86 -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- Diluted earnings (loss) per common share: Income (loss) from continuing operations... $ (.23) $ .20 $ 2.72 $ 1.13 $ 2.64 $ 3.16 $ .83 Income (loss) from discontinued operations, including gain (loss) on disposal........ -- .03 .16 (1.28) (.55) .46 .03 Cumulative effect of a change in accounting principle................................ -- -- -- .01 -- -- -- -------- -------- -------- -------- -------- -------- -------- Net income (loss).................... $ (.23) $ .23 $ 2.88 $ (.14) $ 2.09 $ 3.62 $ .86 -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- -------- --------
AT DECEMBER 31, AT MARCH 31, -------------------------------------------------------------- 2003 2002 2001 2000 1999 1998 ---- ---- ---- ---- ---- ---- (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) SELECTED BALANCE SHEET DATA: Cash and investments....................... $1,026,499 $1,043,471 $1,080,271 $ 998,892 $ 759,089 $1,485,107 Total assets............................... 2,446,153 2,541,778 2,469,087 2,417,783 2,255,239 2,920,916 Debt, including current maturities......... 236,150 233,073 252,279 190,486 268,736 473,226 Customer banking deposits.................. 306,514 392,904 476,495 526,172 329,301 189,782 Shareholders' equity....................... 1,535,082 1,534,525 1,195,453 1,204,241 1,121,988 1,853,159 Book value per common share................ $ 25.75 $ 25.74 $ 21.61 $ 21.78 $ 19.75 $ 29.90 Cash dividends per common share............ $ -- $ .25 $ .25 $ .25 $ 13.58 $ --
- --------- (a) Includes net securities gains (losses) of $2,305,000 and $(9,006,000) for the three month periods ended March 31, 2003 and 2002, respectively, and $(37,066,000), $28,450,000, $124,964,000, $16,268,000 and $(66,159,000) for the years ended December 31, 2002, 2001, 2000, 1999 and 1998, respectively.
(footnotes continued on next page) 20 (footnotes continued from previous page) (b) During 2002, the Internal Revenue Service completed the audit of the Company's consolidated federal income tax returns for the years 1996 through 1999, without any material tax payment required from the Company. As a result of this favorable resolution of various federal income tax contingencies, the income tax provision for 2002 reflects a benefit of approximately $120,000,000. (c) For purposes of computing these ratios, earnings represent consolidated pre-tax income (loss) before cumulative effects of changes in accounting principles and equity in undistributed earnings or loss of associated companies accounted for under the equity method of accounting, plus 'fixed charges.' Fixed charges excluding interest on Deposits include interest expense (other than on Deposits), the portion of net rental expense representative of the interest factor and amortization of debt expense. Fixed charges including interest on Deposits include all interest expense, the portion of net rental expense representative of the interest factor and amortization of debt expense. For the year ended December 31, 2002 in which the ratios indicated a less than one-to-one coverage, the amount of the deficiency was approximately $8,300,000.
21 DESCRIPTION OF CERTAIN INDEBTEDNESS AND OTHER OBLIGATIONS 7 3/4% SENIOR NOTES We currently have outstanding $100 million aggregate principal amount of 7 3/4% senior notes due 2013. The 7 3/4% senior notes were issued pursuant to an indenture dated as of August 15, 1993, with U.S. Bank (formerly, Continental Bank, National Association), as trustee. The 7 3/4% senior notes are our senior unsecured obligations and rank senior in right of payment to all of our existing and future subordinated indebtedness and pari passu in right of payment with all of our existing and future senior indebtedness, including the notes offered hereby. The terms of the indenture governing the 7 3/4% senior notes are substantially identical to the terms of the indenture governing the notes offered hereby. 7 7/8% SENIOR SUBORDINATED NOTES We currently have outstanding $21.6 million aggregate principal amount of 7 7/8% senior subordinated notes due 2006. The 7 7/8% senior subordinated notes were issued pursuant to an indenture dated as of October 21, 1996, with Fleet National Bank, as trustee. The 7 7/8% senior subordinated notes are subordinated to all of our existing and future senior indebtedness, including the notes offered hereby and the 7 3/4% senior notes, and rank pari passu with the 8 1/4% senior subordinated notes. The 7 7/8% senior subordinated notes are not redeemable by us prior to maturity. Upon a change of control, each noteholder will have the right to, subject to various conditions and restrictions, to require us to repurchase such holder's 7 7/8% senior subordinated notes at 101% of their principal amount, plus accrued interest. 8 1/4% SENIOR SUBORDINATED NOTES We currently have outstanding $19.1 million aggregate principal amount of 8 1/4% senior subordinated notes due 2005. The 8 1/4% senior subordinated notes were issued pursuant to an indenture dated as of June 13, 1995, with U.S. Bank (formerly, The First National Bank of Boston), as trustee. The 8 1/4% senior subordinated notes are subordinated to all of our existing and future senior indebtedness, including the notes offered hereby and the 7 3/4% senior notes, and rank pari passu with the 7 7/8% senior subordinated notes. The terms of the indenture governing the 8 1/4% senior subordinated notes are substantially identical to the terms of the indenture governing the 7 7/8% senior subordinated notes. BANK CREDIT FACILITY In March 2003, we entered into a $110 million unsecured bank credit facility which bears interest based on the Eurocurrency Rate or the prime rate and matures in 2006. As of the date of this Offering Circular, no amounts were outstanding under this bank credit facility. AIRCRAFT FINANCING During 2001, we borrowed $53.1 million secured by our corporate aircraft. This debt bears interest based on a floating rate, requires monthly payments of principal and interest and matures in ten years. As of March 31, 2003, $49.3 million was outstanding and the interest rate was 2.4%. We have entered into an interest rate swap agreement on this financing, which fixed the interest rate at approximately 5.7%. TRUST PREFERRED SECURITIES Our wholly-owned subsidiary, Leucadia Capital Trust I (the 'Trust'), currently has outstanding $98.2 million aggregate liquidation amount of 8.65% trust issued preferred securities. These Company-obligated mandatorily redeemable preferred securities have an effective maturity date of January 15, 2027 and represent undivided beneficial interests in the Trust's assets, which consist solely of our 8.65% Junior Subordinated Deferrable Interest Debentures due 2027. Considered together, our 'back-up undertakings' related to the Trust's preferred securities constitute a full and unconditional guarantee by us of the Trust's obligations under the preferred securities. 22 DESCRIPTION OF THE REGISTERED NOTES The registered notes are to be issued under an indenture between the Company and JPMorgan Chase Bank, as trustee, that the Company entered into in connection with the old notes. The terms of the registered notes include those stated in the indenture and those made part of the indenture by reference to the Trust Indenture Act of 1939, as amended. This description of notes summarizes certain provisions of the indenture and the registration rights agreement and makes use of defined terms in the indenture and the registration rights agreement. The following summary does not purport to be complete and is subject to, and is qualified in its entirety by reference to, all of the provisions of the indenture and the registration rights agreement, and terms made a part of the Indenture by reference to the Trust Indenture Act. We urge you to read the indenture, the registration rights agreement and the Trust Indenture Act because they, and not this description, define your rights as a holder of notes. Copies of the indenture and the registration rights agreement are available from the Company as described below under the heading 'Where You Can Find More Information.' You can find the definitions of certain terms used in this description of notes throughout this description of notes. As used in this description of notes, references to 'we,' 'us' or 'the Company' mean Leucadia National Corporation (and its successors in accordance with the terms of the Indenture) and not any of its subsidiaries. The old notes and the registered notes will be considered collectively to be a single class for all purposes under the indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase, and for purposes of this Description of the Registered Notes, all references herein to 'notes' shall be deemed to refer collectively to old notes and any registered notes, unless the context otherwise requires. GENERAL The notes bear interest from June 5, 2003 at the rate of 7% per annum, payable on February 15 and August 15 in each year to the noteholders of record at the close of business on the February 1 and August 1 immediately preceding such interest payment date, commencing August 15, 2003. The notes will be due on August 15, 2013, will be issued only in denominations of $1,000 and integral multiples of $1,000, and will be general unsecured obligations of the Company. The Indenture authorizes an aggregate principal amount of $200,000,000 of the notes. RANKING The notes are senior unsecured obligations of the Company and rank pari passu with all other unsecured and unsubordinated indebtedness of the Company and prior in right of payment to all subordinated indebtedness of the Company. The notes are effectively subordinated to all existing and future indebtedness of our subsidiaries. Had the notes been issued as of March 31, 2003, they would have been effectively subordinated to approximately $530 million of indebtedness and other liabilities of our subsidiaries, including trade payables but excluding intercompany obligations. The notes rank pari passu with the Company's 7 3/4% Senior Notes due 2013. The notes rank senior to the Company's 8 1/4% Senior Subordinated Notes due 2005, the Company's 7 7/8% Senior Subordinated Notes due 2006 and the Company's guarantee of the Trust's 8.65% trust issued preferred securities. OPTIONAL REDEMPTION The notes are not redeemable at the option of the Company prior to maturity. SINKING FUND The notes are not subject to sinking fund payments. CERTAIN COVENANTS The Indenture contains the following covenants: Restriction on Incurrence of Indebtedness by the Company and on the Incurrence of Indebtedness and Issuance of Preferred Stock by Its Subsidiaries. The Company shall not, and shall not permit any 23 Subsidiary to, create, incur, assume, or guarantee the payment of any Indebtedness, and shall not permit any of its Subsidiaries to issue any Preferred Stock, if, at the time of such event and after giving effect thereto on a pro forma basis, the Company's ratio of Consolidated Debt to Consolidated Tangible Net Worth, as of the most recent date for which consolidated financial statements are available and adjusted for the incurrence of all Indebtedness and the issuance of all Preferred Stock by Subsidiaries (other than Permitted Indebtedness) since that date, would be greater than 1.75 to 1. This restriction shall not preclude the incurrence of Permitted Indebtedness. 'Consolidated Debt' means, on any date, the sum of (i) total Indebtedness of the Company and its Subsidiaries, at such date, determined in accordance with GAAP on a consolidated basis, and (ii) the aggregate liquidation preference of all Preferred Stock of Subsidiaries of the Company, at such date, other than Preferred Stock to the extent held by the Company and its Subsidiaries; provided, that Consolidated Debt shall not include Permitted Indebtedness. 'GAAP' means United States generally accepted accounting principles as in effect on December 31, 1992. 'Indebtedness' of any Person means (i) any liability of such Person (a) for borrowed money, (b) evidenced by a note, debenture or similar instrument (including a Purchase Money Obligation or deferred payment obligation) given in connection with the acquisition of any property or assets (other than inventory or similar property acquired in the ordinary course of business), including securities, (c) for the payment of a Capitalized Lease Obligation of such Person or (d) with respect to the reimbursement of any letter of credit, banker's acceptance or similar credit transaction (other than trade letters of credit issued in the ordinary course of business; provided, that the failure to make prompt reimbursement of any trade letter of credit shall be deemed to be the incurrence of Indebtedness); and (ii) any guarantee by such Person of any liability of others described in clause (i) above or any obligation of such Person with respect to any liability of others described in clause (i) above. Indebtedness shall not include Deposits. 'Permitted Indebtedness' means (i) any Indebtedness of the Company and its Subsidiaries outstanding on the date of the Indenture, or any refinancing or replacement thereof; provided, that the aggregate amount of such Indebtedness is not increased, (ii) Acquired Indebtedness, (iii) Preferred Stock of Subsidiaries held by the Company or its Subsidiaries (it being understood that the sale of such Preferred Stock by the Company or such Subsidiary to any Person other than the Company or a Subsidiary of the Company or such Subsidiary no longer being a Subsidiary shall be deemed the issuance of Preferred Stock for purposes of the above test) and (iv) intercompany Indebtedness. 'Acquired Indebtedness' means Indebtedness of a Person either (i) existing at the time such Person becomes a Subsidiary, (ii) assumed in connection with the acquisition of assets of such Person or (iii) any refinancing or replacement by such Person of such Indebtedness; provided, that the aggregate amount of such Indebtedness then outstanding is not increased. Acquired Indebtedness shall not include (x) any such Indebtedness created in anticipation of such Person becoming a Subsidiary (other than a refinancing or replacement of Indebtedness of such Person, which original Indebtedness was not incurred in anticipation of such Person becoming a Subsidiary), or (y) any Indebtedness that is recourse to the Company or any Subsidiary or any of their respective assets, other than to such Person and its Subsidiaries and their respective assets. Limitation on Funded Debt of Material Subsidiaries. Without limiting the preceding covenant, the Company will not permit any Material Subsidiary to (a) create, incur, assume or suffer to exist any Funded Debt other than (i) Funded Debt secured by a Lien on Principal Property which is permitted under the provision described below under 'Limitations on Liens,' (ii) Funded Debt owed to the Company or any Subsidiary, (iii) Funded Debt of a corporation which is merged with or into the Company or a Material Subsidiary, (iv) Funded Debt in existence on the date of the Indenture, (v) Funded Debt created in connection with, or with a view to, compliance by a Material Subsidiary with the requirements of any program adopted by any federal, state or local governmental authority and applicable to such Material Subsidiary and providing financial or tax benefits to such Material Subsidiary which are not available directly to the Company and (vi) Funded Debt that is Acquired Indebtedness; or (b) to guarantee, directly or indirectly through any arrangement that is substantially the equivalent of a guarantee, the payment of any Funded Debt except for (i) guarantees existing on the date of the Indenture, (ii) guarantees which, on the date of the Indenture, a Material Subsidiary is obligated to give and (iii) guarantees of Funded Debt 24 permitted under clause (a) of this paragraph. Notwithstanding the foregoing, any Material Subsidiary may create, incur, assume or guarantee the payment of Funded Debt in addition to that permitted in this paragraph and extend, renew, substitute or replace, in whole or in part, such Funded Debt, provided that at the time of such creation, incurrence, assumption, guarantee, extension, renewal, substitution or replacement, and after giving effect thereto, the aggregate principal amount of all Funded Debt of Material Subsidiaries does not exceed 15% of Consolidated Tangible Net Worth. The term 'Consolidated Tangible Net Worth' means, as of any date, the total shareholders' equity of the Company determined in accordance with GAAP less any and all goodwill and other intangible assets reflected on the consolidated balance sheet of the Company as of such date. Deferred policy acquisition costs ('DPAC'), that portion of the value of insurance in force resulting from an acquisition and equivalent to the amount of DPAC of the acquired entity outstanding immediately prior to such acquisition and deferred taxes shall not be deemed goodwill or other intangible assets for purposes of determining Consolidated Tangible Net Worth. The term 'Funded Debt' means Indebtedness which by its terms matures at, or can be extended or renewed at the option of the obligor to, a date more than twelve months after the date of the creation of such Indebtedness, including, without limitation, outstanding revolving credit loans. Limitations on Liens. The Company will not, and will not permit any Material Subsidiary to, (a) issue, assume or guarantee any Indebtedness if such Indebtedness is secured by a Lien upon, or (b) directly or indirectly secure any outstanding Indebtedness by a Lien upon, any Principal Property, now owned or hereafter acquired, without effectively providing that the notes shall be secured equally and ratably with such Indebtedness, except that the foregoing restrictions shall not apply to (i) Liens on any Principal Property acquired after the date of the Indenture to secure or provide for the payment of the purchase price or acquisition cost thereof, (ii) Liens on Principal Property acquired after the date of the Indenture existing at the time such Principal Property is acquired, (iii) Liens on any Principal Property acquired from a corporation merged with or into the Company or a Material Subsidiary, (iv) Liens in favor of the Company or any Subsidiary, (v) Liens in existence on any Principal Property on the date of the Indenture, (vi) Liens on any Principal Property constituting unimproved real property constructed or improved after the date of the Indenture to secure or provide for the payment or cost of such construction or improvement, (vii) Liens in favor of, or required by, governmental authorities, (viii) pledges or deposits in connection with workers' compensation, unemployment insurance and other social security legislation and deposits securing liability to insurance carriers under insurance or self-insurance arrangements or other pledges or deposits in the ordinary course of the insurance business of a Material Subsidiary of the Company that is a licensed insurance company, including, without limitation, those relating to the insurance or reinsurance operations of such Material Subsidiaries and those relating to the requirements to create 'separate accounts,' (ix) Liens for taxes not yet due or which are being contested in good faith by appropriate proceedings, (x) Liens securing any extension, renewal, substitution or replacement (or successive extensions, renewals, substitutions or replacements) of Indebtedness of the Company or any Material Subsidiary outstanding as of March 31, 1993, and (xi) any extension, renewal, substitution or replacement (or successive extensions, renewals, substitutions or replacements), in whole or in part, of any Lien referred to in the foregoing clauses (i) through (x), inclusive. Notwithstanding the foregoing, the Company and any Material Subsidiary may, without equally and ratably securing the notes, issue, assume or guarantee secured Indebtedness (which would otherwise be subject to the foregoing Lien restrictions) in an aggregate amount which, together with all other such secured Indebtedness of the Company and its Material Subsidiaries (that is, not including secured Indebtedness of the Company and its Material Subsidiaries permitted pursuant to the preceding paragraph) and the Attributable Debt in respect of Sale and Lease-Back Transactions existing at such time (other than Sale and Lease-Back Transactions permitted in accordance with the first paragraph under the caption 'Limitation on Sale and Lease-Back Transactions' below), does not at the time exceed 15% of the shareholders' equity in the Company and its consolidated Subsidiaries as shown on the audited consolidated balance sheet contained in the latest annual report to shareholders of the Company. 'Lien' means any mortgage, lien, pledge, security interest, conditional sale or other title retention agreement or other security interest or encumbrance of any kind (including any agreement to give any security interest). 25 The term 'Material Subsidiary' means (i) any Subsidiary of the Company which at December 31, 1992 was a 'significant subsidiary' under Regulation S-X promulgated by the SEC or any successor to such Subsidiary and (ii) any other Subsidiary of the Company; provided that the Company's investments in and advances to such Subsidiary at the date of determination thereof, without giving effect to any write-downs in such investments or advances taken within the prior 12 months, represent 20% or more of the Company's Consolidated Tangible Net Worth as of such time; provided, however, that this clause (ii) shall not include any Subsidiary if, at the time that it became a Subsidiary, the Company contemplated commencing a voluntary case or proceeding under the Bankruptcy Law with respect to such Subsidiary. The term 'Principal Property' means all property, assets or revenue of the Company and each Material Subsidiary now owned or hereafter acquired and all shares of stock and Indebtedness of any Material Subsidiary now owned or hereafter acquired. Limitation on Sale and Lease-Back Transactions. Sale and Lease-Back Transactions by the Company or any Material Subsidiary are prohibited unless the proceeds of such sale or transfer are at least equal to the fair value (as determined by the Board of Directors) of the Principal Property to be leased pursuant to such Sale and Lease-Back Transaction and either (i) the Company or such Material Subsidiary could incur a Lien on such Principal Property under the covenant described in 'Limitation on Liens' above, (ii) such Sale and Lease-Back Transactions are between or among the Company and any of its Subsidiaries or between or among Subsidiaries, (iii) the lease is for a period not exceeding three years and the Company or such Material Subsidiary that is a party to such lease intends that its use of such Principal Property will be discontinued on or before the expiration of such period, or (iv) the Company applies, or causes such Material Subsidiary to apply, an amount equal to the fair value (as determined by the Board of Directors) of the Principal Property sold pursuant to such Sale and Lease-Back Transaction to (A) the retirement, within 60 days after the effective date of any such Sale and Lease-Back Transaction, of Funded Debt of the Company or of such Material Subsidiary, or (B) the purchase of other property that will constitute a Principal Property. Notwithstanding the provisions of the preceding paragraph, the Company or any Material Subsidiary may enter into any Sale and Lease-Back Transaction which would otherwise be subject to the following restrictions, if the amount of Attributable Debt in respect of such Sale and Lease-Back Transaction, together with all secured Indebtedness of the Company and its Material Subsidiaries (other than secured Indebtedness of the Company and Material Subsidiaries permitted under the first paragraph under the caption 'Limitation on Liens' above) and all other Attributable Debt in respect of Sale and Lease-Back Transactions existing at such time (other than Sale and Lease-Back Transactions permitted pursuant to the preceding paragraph), does not at the time exceed 15% of the shareholders' equity in the Company and its consolidated Subsidiaries as shown on the audited consolidated balance sheet contained in the latest annual report to shareholders of the Company. The term 'Attributable Debt' means, as of any particular time, the present value, discounted at a rate per annum equal to the interest rate of the notes, of the rental payments (not including amounts payable by the lessee for maintenance, property taxes and insurance) due 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). The term 'Sale and Lease-Back Transaction' means the sale or transfer of any Principal Property owned by the Company or any Material Subsidiary with the intention of taking back a lease on such property. Although the Indenture contains the foregoing restrictions on the ability of the Company and its Subsidiaries to incur Indebtedness, the Company and its Subsidiaries may engage in transactions that, although in compliance with such restrictions, would result in additional leverage, which may adversely affect the noteholders. REPURCHASE AT OPTION OF HOLDERS UPON A CHANGE OF CONTROL In the event of any Change of Control, each noteholder shall have the right, at such noteholder's option, to require the Company to purchase all or any portion (in integral multiples of $1,000) of such noteholder's notes on the date (the 'Change of Control Payment Date') which is 20 business days after 26 the date the Change of Control Notice (as defined below) is mailed (or such later date as is required by applicable law) at 101% of the principal amount (excluding premium) thereof, plus accrued interest to the Change of Control Payment Date: provided that the Company will not be obligated to purchase any of such notes unless noteholders of at least 10% of the notes outstanding at the Change of Control Payment Date (other than notes held by the Company and its Affiliates) shall have tendered their notes for repurchase. The Company is obligated to send to all noteholders, within five business days after the occurrence of each Change of Control, a notice of the occurrence of such Change of Control (the 'Change of Control Notice'), specifying a date by which a noteholder must notify the Company of such noteholder's intention to exercise the repurchase right and describing the procedure that such noteholder must follow to exercise such right. The Company is required to deliver a copy of such notice to the Trustee and to cause a copy of such notice to be published in a daily newspaper of national circulation. To exercise the repurchase right, the noteholder must deliver, on or before the fifth calendar day prior to the Change of Control Payment Date, written notice (which shall be irrevocable, except as provided below) to the Company (or an agent designated by the Company for such purpose) of the noteholder's exercise of such right, together with (i) the note or notes with respect to which the right is being exercised, duly endorsed for transfer with the form entitled 'Option of Holder to Elect Purchase' on the reverse of the note completed, and (ii) if the Change of Control Payment Date falls between any record date for the payment of interest on the notes and the next succeeding interest payment date, an amount equal to the interest which the noteholder is entitled to receive on such interest payment date. The Company will comply with all applicable Federal and state securities laws, including Rule 14e-1 of the Exchange Act and other applicable tender offer rules, in connection with each Change of Control Notice. A 'Change of Control' shall be deemed to occur if (i) the Company has any other Indebtedness outstanding (other than Indebtedness under a bank credit agreement or similar bank financing) which provides for a Change of Control (as defined in the instrument governing such Indebtedness) if Ian M. Cumming or Joseph S. Steinberg ceases to beneficially own, in the aggregate, a certain percentage of the outstanding Common Shares, which percentage ownership requirement is in excess of 10%, and a Change of Control (as defined in the instrument governing such Indebtedness) occurs under such Indebtedness or (ii) at any time when the Company does not have any other Indebtedness outstanding of the type referred to in clause (i), Ian M. Cumming or Joseph S. Steinberg, individually or in the aggregate, sells, transfers or otherwise disposes of (a 'Disposition'), after the date hereof, Common Shares so that, after giving effect thereto, the sole beneficial ownership of outstanding Common Shares by Mr. Cumming and/or Mr. Steinberg would, in the aggregate, fall below 10% of the then outstanding Common Shares; provided that no Change of Control shall be deemed to have occurred under clause (ii) if the notes are rated by both Moody's and S&P as Investment Grade both at the time of such Disposition and for a period of 90 days from the date of such Disposition (it being understood that, with respect to the foregoing proviso, a Change of Control shall be deemed to occur on the first date during such 90-day period when the notes are no longer rated as Investment Grade by Moody's and S&P). The term 'Common Shares' shall include any securities issued as dividends or distributions on the Common Shares. For purposes hereof, 'sole beneficial ownership' of Common Shares shall be deemed to include (i) all Common Shares received after June 15, 1992 from Mr. Cumming or Mr. Steinberg by any member of their respective immediate families or by any trust for the benefit of either of them or any member of their respective immediate families (a 'Recipient'), which Common Shares remain held by a Recipient during the lifetime of Mr. Cumming or Mr. Steinberg (unless sold, transferred or disposed of by such Recipient during the lifetime of Mr. Cumming or Mr. Steinberg, as the case may be, in which case such Disposition by such Recipient shall constitute a Disposition by Mr. Cumming or Mr. Steinberg, as the case may be) and (ii) after the death of Mr. Cumming and/or Mr. Steinberg, all Common Shares owned as of the date of death by the decedent, and any Recipient of the decedent, regardless of whether such Recipient continues to own such Common Shares after the date of death. In determining the number of outstanding Common Shares then held by Messrs. Cumming and Steinberg and the total number of outstanding Common Shares, there shall be excluded Common Shares issued by the Company after December 31, 1991, or the conversion into or exchange for, after December 31, 1991, Common Shares or securities convertible into or exchangeable for Common Shares. As calculated pursuant to this provision, Messrs. Cumming and Steinberg beneficially own, in the aggregate, approximately 43% of the Common Shares as of March 31, 2003. 27 As of the date hereof, the Company does not have any Indebtedness outstanding of the type referred to in clause (i) of the preceding paragraph. There can be no assurance that the Company will have sufficient funds or the financing to satisfy its obligations to repurchase the notes and other Indebtedness that may come due upon a Change of Control. In such case, the Company's failure to purchase tendered notes would constitute an Event of Default under the Indenture. The holders of majority in principal amount of notes then outstanding may waive compliance by the Company of the repurchase of notes upon a Change of Control. The Company may not waive such provisions. See 'Modification of the Indenture.' The term 'Investment Grade' is defined as BBB- or higher by S&P or Baa3 or higher by Moody's or the equivalent of such ratings by Moody's or S&P. TRANSACTIONS WITH AFFILIATES The Company shall not, and shall not permit any Subsidiary to, directly or indirectly, enter into any transaction or series of related transactions with any Affiliate (other than with the Company or a Wholly-Owned Subsidiary), including, without limitation, any loan, advance or investment or any purchase, sale, lease or exchange of property or the rendering of any service, unless such transaction or series of transactions is in good faith and at arm's-length and on terms which are at least as favorable as those available in a comparable transaction from an unrelated Person. Any such transaction that involves in excess of $10,000,000 shall be approved by a majority of the Independent Directors on the Board of Directors of the Company; or, in the event that at the time of any such transaction or series of related transactions there are no Independent Directors serving on the Board of Directors of the Company, such transaction or series of related transactions shall be approved by a nationally recognized expert with experience in appraising the terms and conditions of the type of transaction for which approval is required. SUCCESSOR CORPORATION The Company may not consolidate with, merge into or transfer all or substantially all of its assets (i.e., 90% or more) to another corporation unless (a) the successor corporation shall be existing under the laws of the United States, any state thereof or the District of Columbia, (b) there shall not be any Default or Event of Default under the Indenture, (c) such successor corporation assumes all of the Obligations of the Company under the notes and the Indenture and (d) after giving effect to such transaction, such successor corporation shall have a Consolidated Net Worth equal to or greater than the Company. Thereafter all such obligations of the Company will terminate. REPORTS TO NOTEHOLDERS The Company will mail copies of its annual reports and quarterly reports mailed to its shareholders to noteholders. If the Company is not required to furnish annual or quarterly reports to its shareholders, the Company will, upon request, mail to each noteholder, at such noteholder's address as appearing on the note register, audited annual financial statements prepared in accordance with United States generally accepted accounting principles and unaudited condensed quarterly financial statements. Such financial statements shall be accompanied by management's discussion and analysis of the results of operations and financial condition of the Company for the period reported upon in substantially the form required under the rules and regulations of the Commission currently in effect. THE TRUSTEE JPMorgan Chase Bank is the Trustee under the Indenture. The noteholders of a majority in principal amount of all outstanding notes will have the right to direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee. The Indenture will provide that, in case an Event of Default shall occur and be continuing, the Trustee will be required to use the degree of care of a prudent person in the conduct of his own affairs in the exercise of its power. Subject to such provisions, the Trustee will be under no obligation to 28 exercise any of its rights or powers under the Indenture at the request of any of the noteholders, unless they shall have offered to the Trustee security and indemnity satisfactory to it. EVENTS OF DEFAULT AND NOTICE THEREOF The term 'Event of Default' when used in the Indenture shall mean any one of the following: (i) failure to pay interest for 30 days or principal (including premium, if any); (ii) failure to perform any covenants not described in clause (i) for 30 days after receipt of notice; (iii) the occurrence of a default in the payment when due of principal of, or interest on, or other amounts payable in respect of, any instrument evidencing or securing other Indebtedness of the Company or any Material Subsidiary of the Company in the aggregate principal amount of $15,000,000 or more; (iv) the occurrence of any other event of default under an instrument evidencing or securing other indebtedness of the Company or any Material Subsidiary of the Company in the aggregate principal amount of $15,000,000 or more resulting in the acceleration of such indebtedness, which acceleration is not rescinded or annulled pursuant to the terms of such instrument; and (v) certain events of bankruptcy, insolvency or reorganization relating to the Company or any Material Subsidiary of the Company. The Indenture will provide that the Trustee shall, within 90 days after the occurrence of a default, provide to the noteholders notice of all uncured defaults known to it (the term default to include the events specified above without grace or notice); provided, that, except in the case of default in the payment of principal of, premium, if any, or interest on any of the notes, the Trustee shall be protected in withholding such notice if and so long as a committee of its Trust Officers in good faith determines that the withholding of such notice is in the interests of the noteholders. In case an Event of Default (other than an Event of Default with respect to the Company specified in clause (v) above) shall have occurred and be continuing, the Trustee or the holders of at least 25% in aggregate principal amount of the notes then outstanding, by notice in writing to the Company and to the Trustee, may declare to be due and payable immediately the outstanding principal amount and accrued interest, premiums, penalties and other amounts in respect of the notes and the Indenture. Such declaration may be annulled and past defaults (except, unless theretofore cured, a default in payment of principal, premium, if any, or interest on the notes) may be waived by the holders of a majority in principal amount of the notes, upon the conditions provided in the Indenture. If an Event of Default with respect to the Company specified in clause (v) above occurs, all unpaid principal of, premium, if any, and accrued interest on the notes then outstanding shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any holder of notes. The Indenture will include a covenant that the Company will file annually with the Trustee a statement regarding compliance by the Company with the terms thereof and specifying any defaults of which the signers may have knowledge. MODIFICATION OF THE INDENTURE Under the Indenture, the rights and obligations of the Company and the rights of noteholders may be modified by the Company and the Trustee only with the consent of the noteholders holding a majority in principal amount of the notes then outstanding; but no extension of the maturity of any notes, or reduction in the interest rate or premium, if any, or extension of the time of payment of principal of (including premium, if any) or interest on, or any change that adversely affects the right of a noteholder to convert any notes, or any change in the subordination of the notes that is adverse to the noteholders, or any other modification in the terms of payment of the principal of, or premium, if any, or interest on the notes or reduction of the percentage required for modification will be effective against any noteholder without its consent. The holders of a majority in principal amount of notes then outstanding may waive compliance by the Company with certain covenants, including those described under 'Repurchase at Option of Holders Upon a Change of Control.' 29 SATISFACTION AND DISCHARGE OF INDENTURE The Indenture will be discharged and cancelled upon payment or redemption of all the notes or upon deposit with the Trustee, within not more than one year prior to the maturity of the notes, of funds sufficient for such payment or redemption. REGISTRATION RIGHTS; LIQUIDATED DAMAGES The Company and the initial purchaser of the old notes entered into a registration rights agreement pursuant to which the Company agreed, for the benefit of the holders of the notes, to file under the Securities Act a registration statement relating to an offer to exchange any and all of the old notes for a like aggregate principal amount of registered notes which are substantially identical to the old notes, except that the registered notes have been registered pursuant to an effective registration statement under the Securities Act and do not contain provisions for the liquidated damages described below. If: (1) prior to the time the exchange offer is completed (A) existing Commission interpretations are changed such that the registered notes received in the exchange offer would not in general be, upon receipt, transferable by holders thereof without restrictions under the Securities Act or (B) the interests of the holders of the notes, taken as a whole, would be materially adversely affected by the consummation of the exchange offer; (2) applicable Commission interpretations would not permit consummation of the exchange offer; (3) the exchange offer has not been completed within 225 days following the issue date of the old notes; or (4) the exchange offer is not available to any holder of the notes, the Company shall, in lieu of (or, in the case of clause (4), in addition to) conducting the exchange offer, file under the Securities Act a 'shelf' registration statement providing for the registration of, and the sale on a continuous or delayed basis by the holders of, all of the Registrable Securities. In the event that: (a) the Company has not filed the registration statement or shelf registration statement on or before the date on which such registration statement is required to be filed; or (b) such registration statement or shelf registration statement has not become effective or been declared effective by the Commission on or before the date on which such registration statement is required to become or be declared effective; or (c) the exchange offer has not been completed within 45 days after the initial effective date of the registration statement relating to the exchange offer (if the exchange offer is then required to be made); or (d) any shelf registration statement is filed and declared effective but shall thereafter either be withdrawn by the Company or shall become subject to an effective stop order suspending the effectiveness of such registration statement without being succeeded within 30 days by an additional registration statement filed and declared effective; then, in addition to the interest on the notes, liquidated damages shall accrue at an amount per week per $1,000 principal amount of notes equal to $0.05 for the first 90 days of the registration default period, increasing by an additional $0.05 per week per $1,000 principal amount of notes with respect to each subsequent 90-day period, up to a maximum of $0.25 per week per $1,000 principal amount of notes. Liquidated damages shall be paid on the interest payment dates to holders of record for the payment of interest. Holders of notes will be required to make certain representations to the Company and to deliver information to be used in connection with the shelf registration statement (in each case, as described in the registration rights agreement) and will be required to provide comments on the shelf registration statement within the time periods set forth in the registration rights agreement in order to have their notes included in the shelf registration statement and benefit from the provisions regarding liquidated damages set forth above. Except in certain limited circumstances, the Global Notes may be transferred, in whole and not in part, only to another nominee of DTC or to a successor of DTC or its nominee. Beneficial interests in the Global Notes may not be exchanged for notes in certificated form, except in certain limited circumstances. See ' -- Exchange of Interests in Global Notes for Certificated Notes.' 30 FEDERAL INCOME TAX CONSIDERATIONS The following is a summary of the material U.S. federal income tax considerations relating to the exchange of old notes for registered notes in the exchange offer. It does not contain a complete analysis of all the potential tax considerations relating to the exchange. This summary is limited to holders of old notes who hold the old notes as 'capital assets' (in general, assets held for investment). Special situations, such as the following, are not addressed: tax consequences to holders who may be subject to special tax treatment, such as tax-exempt entities, dealers in securities or currencies, financial institutions, insurance companies, regulated investment companies, traders in securities that elect to use a mark-to-market method of accounting for their securities holdings or corporations that accumulate earnings to avoid U.S. federal income tax; tax consequences to persons holding notes as part of a hedging, integrated, constructive sale or conversion transaction or a straddle or other risk reduction transaction; tax consequences to holders whose 'functional currency' is not the U.S. dollar; tax consequences to persons who hold notes through a partnership or similar pass-through entity; alternative minimum tax consequences, if any; or any state, local or foreign tax consequences. The discussion below is based upon the provisions of the Internal Revenue Code of 1986, existing and proposed Treasury regulations promulgated thereunder, and rulings, judicial decisions and administrative interpretations thereunder, as of the date hereof. Those authorities may be changed, perhaps retroactively, so as to result in U.S. federal income tax consequences different from those discussed below. CONSEQUENCES OF TENDERING NOTES The exchange of your notes for registered notes in the exchange offer would not constitute an exchange for federal income tax purposes. Accordingly, the exchange of your old notes for registered notes would have no federal income tax consequences to you. For example, there would be no change in your tax basis and your holding period would carry over to the registered notes. In addition, the federal income tax consequences of holding and disposing of your registered notes would also be the same as those applicable to your old notes. THE PRECEDING DISCUSSION OF CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS IS FOR GENERAL INFORMATION ONLY AND IS NOT TAX ADVICE. ACCORDINGLY, EACH INVESTOR SHOULD CONSULT ITS OWN TAX ADVISOR AS TO PARTICULAR TAX CONSEQUENCES TO IT OF EXCHANGING OLD NOTES FOR REGISTERED NOTES, INCLUDING THE APPLICABILITY AND EFFECT OF ANY STATE, LOCAL OR FOREIGN TAX LAWS, AND OF ANY PROPOSED CHANGES IN APPLICABLE LAWS. 31 PLAN OF DISTRIBUTION Each broker-dealer that receives registered notes in the exchange offer for its own account must acknowledge that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of the notes. We reserve the right in our sole discretion to purchase or make offers for, or to offer registered notes for, any old notes that remain outstanding subsequent to the expiration of the exchange offer pursuant to this prospectus or otherwise and, to the extent permitted by applicable law, purchase old notes in the open market, in privately negotiated transactions or otherwise. This prospectus, as it may be amended or supplemented from time to time, may be used by all persons subject to the prospectus delivery requirements of the Securities Act, including broker-dealers in connection with resales of registered notes received in the exchange offer, where the notes were acquired as a result of market-making activities or other trading activities and may be used by us to purchase any notes outstanding after expiration of the exchange offer. We have agreed that, for a period of 180 days after the expiration of the exchange offer, we will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with such a resale. We will not receive any proceeds from any sale of registered notes by broker-dealers. Notes received by broker-dealers in the exchange offer for their own account may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the registered notes or a combination of those methods of resale, at market prices prevailing at the time of resale, at prices related to the prevailing market prices or negotiated prices. Such a resale may be made directly to purchases or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from such a broker-dealer and/or the purchasers of any of the registered notes. Any broker-dealer that resells registered notes that were received by it in the exchange offer for its own account an any broker or dealer that participates in a distribution of the notes may be deemed to be an 'underwriter' within the meaning of the Securities Act and any profit on such a resale of the notes and any commissions or concessions received by those persons may be deemed to be underwriting compensation under the Securities Act. The letter of transmittal states that, by acknowledging that it will deliver and by delivering a prospectus meeting the requirements of the Securities Act, a broker-dealer will not be deemed to admit that it is an 'underwriter' within the meaning of the Securities Act. For a period of 180 days after the expiration of the exchange offer, we will promptly send additional copies of this prospectus and any amendment or supplement to this prospectus to any broker-dealer that requests these documents in the letter of transmittal. We have agreed to pay all expenses incident to the exchange offer, including the reasonable fees and expenses of counsel to the initial purchasers of the old notes, other than commissions or concessions of any brokers or dealers, and will indemnify holders of the notes, including any broker-dealers, against certain liabilities, including liabilities under the Securities Act. LEGAL MATTERS Weil, Gotshal & Manges LLP has passed upon the validity of the notes on behalf of the issuer. EXPERTS Our financial statements incorporated by reference in this prospectus and elsewhere in the registration statement of which this prospectus is a part to our Annual Report on Form 10-K for the year ended December 31, 2002 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, independent accountants, given on the authority of said firm as experts in accounting and auditing. 32 ________________________________________________________________________________ $200,000,000 LEUCADIA NATIONAL CORPORATION [LEUCADIA LOGO] EXCHANGE OFFER FOR 7% SENIOR NOTES DUE 2013 ________________________________________________________________________________ PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS. The registrant is a New York corporation. Sections 722 through 725 of the New York Business Corporation Law (the 'Business Corporation Law') provide that a corporation may indemnify, with certain limitations and exceptions, a director or officer as follows: (1) in a derivative action, against his reasonable expenses, including attorneys' fees but excluding certain settlement costs, actually and necessarily incurred by him in connection with the defense thereof, or an appeal therein, if such director or officer acted, in good faith, for a purpose which he reasonably believed to be in (or in the case of service for another corporation, not opposed to) the best interests of the corporation; and (2) in a civil or criminal non-derivative action or proceeding including a derivative action by another corporation, partnership or other enterprise in which any director or officer of the indemnifying corporation served in any capacity at the indemnifying corporation's request, against judgments, fines, settlement payments and reasonable expenses, including attorneys' fees, incurred as a result thereof, or any appeal therein, if such director or officer acted in good faith, for a purpose which he reasonably believed to be in (or, in the case of service for any other corporation, not opposed to) the best interests of the corporation and, in criminal actions and proceedings, in addition, had no reasonable cause to believe that his conduct was unlawful. Such indemnification is a matter of right where the director or officer has been successful on the merits or otherwise, and otherwise may be granted upon corporate authorization or court award as provided in the statute. Section 721 of the Business Corporation Law provides that indemnification arrangements can be established for directors and officers, by contrast, by-law, charter provision, action of shareholders or board of directors, on terms other than those specifically provided by Article 7 of the Business Corporation Law, provided that no indemnification may be made to or on behalf of any director or officer if a judgment or other final adjudication adverse to the director or officer establishes that his acts were committed in bad faith or were the result of active and deliberate dishonesty and were material to the cause of action so adjudicated, or that he personally gained in fact a financial profit or other advantage to which he was not legally entitled. Article V of the Company's By-Laws provides for the indemnification, to the full extent authorized by law, of any person made or threatened to be made a party in any civil or criminal action or proceeding by reason of the fact that he, his testator or intestate is or was a director or officer of the Company. Section 726 of the Business Corporation Law provides that a corporation may obtain insurance to indemnify itself and its directors and officers. The Company maintains an insurance policy providing both directors and officers liability coverage and corporate reimbursement coverage. Article Sixth of the Company's Certificate of Incorporation contains a charter provision eliminating or limiting director liability for monetary damages arising from breaches of fiduciary duty, subject only to certain limitations imposed by statute. ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. (a) Exhibits
EXHIBIT NUMBER DESCRIPTION - ------ ----------- 4.1 -- Indenture, dated as of June 5, 2003 between Registrant and JPMorgan Chase Bank with respect to Registrant's 7% Senior Notes due 2013. 4.2 -- Registration Rights Agreement, dated as of June 5, 2003, between Registrant and Jefferies & Company, Inc., with respect to Registrant's 7% Senior Notes due 2013. 4.3 -- Form of 7% Senior Note (included in Exhibit 4.1). 5.1 -- Opinion of Weil, Gotshal & Manges LLP. 12.1 -- Computation of Ratio of Earnings to Fixed Charges. 23.1 -- Consent of PricewaterhouseCoopers LLP. 23.2 -- Consent of Weil, Gotshal & Manges LLP (included in Exhibit 5.1). 24.1 -- Power of Attorney (contained on signature page).
II-1
EXHIBIT NUMBER DESCRIPTION - ------ ----------- 25.1 -- Form T-1 statement of eligibility under the Trust Indenture Act of 1939 of JPMorgan Chase Bank, as trustee. 99.1 -- Form of Letter of Transmittal. 99.2 -- Form of Notice of Guaranteed Delivery.
ITEM 22. UNDERTAKINGS. (a) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by a registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question 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. (b) The undersigned registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Item 4, 10(b), 11 or 13 of this form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request. (c) The undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective. (d) The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the 'Calculation of Registration Fee' table in the effective registration statement. (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (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-2 (4) If the registrant is a foreign private issuer, to file a post-effective amendment to the registration statement to include any financial statements required by Item 8.A. of Form 20-F at the start of any delayed offering or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Act need not be furnished, provided, that the registrant includes in the prospectus, by means of a post-effective amendment, financial statements required pursuant to this paragraph (a)(4) and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements. Notwithstanding the foregoing, with respect to registration statements on Form F-3, a post-effective amendment need not be filed to include financial statements and information required by Section 10(a)(3) of the Act or Rule 3-19 of this chapter if such financial statements and information are contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the Form F-3. II-3 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, State of New York, on the 15th day of July, 2003. LEUCADIA NATIONAL CORPORATION By: /S/ JOSEPH A. ORLANDO .................................. JOSEPH A. ORLANDO VICE PRESIDENT AND CHIEF FINANCIAL OFFICER POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Joseph A. Orlando and Barbara L. Lowenthal, and each of them, as his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) and supplements to this Registration Statement, and to file the same with the Commission, granting 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 connection therewith, as fully to all intents and purposes as he or she 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. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been duly signed below by the following persons on behalf of Leucadia National Corporation and in the capacities and on the dates indicated.
Name Title Date ---- ---- ---- July 15, 2003 /s/ IAN M. CUMMING Chairman of the Board ......................................... (Principal Executive Officer) (IAN M. CUMMING) /s/ JOSEPH S. STEINBERG President and Director July 15, 2003 ......................................... (Principal Executive Officer) (JOSEPH S. STEINBERG) /s/ JOSEPH A. ORLANDO Vice President and Chief Financial July 15, 2003 ......................................... Officer (JOSEPH A. ORLANDO) (Principal Financial Officer) /s/ BARBARA L. LOWENTHAL Vice President and Comptroller July 15, 2003 ......................................... (Principal Accounting Officer) (BARBARA L. LOWENTHAL) /s/ PAUL M. DOUGAN Director July 15, 2003 ......................................... (PAUL M. DOUGAN) /s/ LAWRENCE D. GLAUBINGER Director July 15, 2003 ......................................... (LAWRENCE D. GLAUBINGER) /s/ JAMES E. JORDAN Director July 15, 2003 ......................................... (JAMES E. JORDAN) /s/ JESSE CLYDE NICHOLS, III Director July 15, 2003 ......................................... (JESSE CLYDE NICHOLS, III)
II-4 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION ------ ----------- 4.1 -- Indenture, dated as of June 5, 2003 between Registrant and JPMorgan Chase Bank with respect to Registrant's 7% Senior Notes due 2013. 4.2 -- Registration Rights Agreement, dated as of June 5, 2003, between Registrant and Jefferies & Company, Inc., with respect to Registrant's 7% Senior Notes due 2013. 4.3 -- Form of 7% Senior Note (included in Exhibit 4.1). 5.1 -- Opinion of Weil, Gotshal & Manges LLP. 12.1 -- Computation of Ratio of Earnings to Fixed Charges. 23.1 -- Consent of PricewaterhouseCoopers LLP. 23.2 -- Consent of Weil, Gotshal & Manges LLP (included in Exhibit 5.1). 24.1 -- Power of Attorney (contained on signature page). 25.1 -- Form T-1 statement of eligibility under the Trust Indenture Act of 1939 of JPMorgan Chase Bank, as trustee. 99.1 -- Form of Letter of Transmittal. 99.2 -- Form of Notice of Guaranteed Delivery.
II-5 EX-4 3 ex4-1.txt EXHIBIT 4.1 - -------------------------------------------------------------------------------- LEUCADIA NATIONAL CORPORATION and JPMORGAN CHASE BANK, as Trustee --------------------------- INDENTURE Dated as of June 5, 2003 --------------------------- $200,000,000 7% Senior Notes due 2013 - -------------------------------------------------------------------------------- CROSS-REFERENCE TABLE TIA Section Indenture Section - ----------- ----------------- 310(a)(1)............................................. 6.10 (a)(2).......................................... 6.10 (a)(3).......................................... N.A. (a)(4).......................................... N.A. (a)(5).......................................... 6.08 (b)............................................. 6.08; 6.10 (c)............................................. N.A. 311(a)................................................ 6.11 (b)............................................. 6.11 (c)............................................. N.A. 312(a)................................................ 2.05 (b)............................................. 9.03 (c)............................................. 9.03 313(a)................................................ 6.06 (b)(1).......................................... N.A. (b)(2).......................................... 6.06 (c)............................................. 6.06; 9.02 (d)............................................. 6.06 314(a)................................................ 3.02; 3.03; 9.02 (b)............................................. N.A. (c)(1).......................................... 9.04 (c)(2).......................................... 9.04 (c)(3).......................................... N.A. (d)............................................. N.A. (e)............................................. 9.05 (f)............................................. N.A. 315(a)................................................ 6.01(b) (b)............................................. 6.05; 9.02 (c)............................................. 6.01(a) (d)............................................. 6.01(c) (e)............................................. 5.11 316(a)(last sentence)................................. 9.06 (a)(1)(A)....................................... 5.05 (a)(1)(B)....................................... 5.02; 5.04; 8.02 (a)(2).......................................... N.A. (b)............................................. 5.07 317(a)(1)............................................. 5.08 (a)(2).......................................... 5.09 (b)............................................. 2.04 318(a)................................................ 9.01 - --------------------------- N.A. means Not Applicable. NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to be part of this Indenture. i TABLE OF CONTENTS
Page ARTICLE One DEFINITIONS AND INCORPORATION BY REFERENCE SECTION 1.01. Definitions...................................................................................1 SECTION 1.02. Other Definitions.............................................................................6 SECTION 1.03. Incorporation by Reference of Trust Indenture Act.............................................6 SECTION 1.04. Rules of Construction.........................................................................6 ARTICLE Two THE SECURITIES SECTION 2.01. Form and Dating...............................................................................6 SECTION 2.02. Execution and Authentication..................................................................6 SECTION 2.03. Registrar and Paying Agent....................................................................6 SECTION 2.04. Paying Agent To Hold Money in Trust...........................................................6 SECTION 2.05. Securityholder Lists..........................................................................6 SECTION 2.06. Transfer and Exchange.........................................................................6 SECTION 2.07. Replacement Securities........................................................................6 SECTION 2.08. Outstanding Securities........................................................................6 SECTION 2.09. Temporary Securities..........................................................................6 SECTION 2.10. Cancellation..................................................................................6 SECTION 2.11. Defaulted Interest............................................................................6 SECTION 2.12. Book-Entry Provisions for Global Securities...................................................6 SECTION 2.13. Transfer and Exchange of Securities...........................................................6 ARTICLE Three COVENANTS SECTION 3.01. Payment of Securities.........................................................................6 SECTION 3.02. SEC Reports...................................................................................6 SECTION 3.03. Compliance Certificate........................................................................6 SECTION 3.04. Maintenance of Office or Agency...............................................................6 SECTION 3.05. Corporate Existence...........................................................................6 SECTION 3.06. Waiver of Stay, Extension or Usury Laws.......................................................6 SECTION 3.07. Transactions with Affiliates..................................................................6 SECTION 3.08. Change of Control.............................................................................6 SECTION 3.09. Limitation on Incurrence of Additional Indebtedness by the Company and on the Incurrence of Additional Indebtedness and Issuance of Preferred Stock by Its Subsidiaries..............................................................................6 ii SECTION 3.10. Limitation on Liens...........................................................................6 SECTION 3.11. Limitation on Sale and Lease-Back Transactions................................................6 SECTION 3.12. Limitation on Funded Debt of Material Subsidiaries............................................6 ARTICLE Four SUCCESSOR CORPORATION SECTION 4.01. When Company May Merge, etc...................................................................6 SECTION 4.02. Successor Corporation Substituted.............................................................6 ARTICLE Five DEFAULTS AND REMEDIES SECTION 5.01. Events of Default.............................................................................6 SECTION 5.02. Acceleration..................................................................................6 SECTION 5.03. Other Remedies................................................................................6 SECTION 5.04. Waiver of Past Defaults.......................................................................6 SECTION 5.05. Control by Majority...........................................................................6 SECTION 5.06. Limitation on Remedies........................................................................6 SECTION 5.07. Rights of Holders To Receive Payment..........................................................6 SECTION 5.08. Collection Suit by Trustee....................................................................6 SECTION 5.09. Trustee May File Proofs of Claim..............................................................6 SECTION 5.10. Priorities....................................................................................6 SECTION 5.11. Undertaking for Costs.........................................................................6 ARTICLE Six TRUSTEE SECTION 6.01. Duties of Trustee.............................................................................6 SECTION 6.02. Rights of Trustee.............................................................................6 SECTION 6.03. Individual Rights of Trustee..................................................................6 SECTION 6.04. Trustee's Disclaimer..........................................................................6 SECTION 6.05. Notice of Defaults............................................................................6 SECTION 6.06. Reports by Trustee to Holders.................................................................6 SECTION 6.07. Compensation and Indemnity....................................................................6 SECTION 6.08. Replacement of Trustee........................................................................6 SECTION 6.09. Successor Trustee by Merger, etc..............................................................6 SECTION 6.10. Eligibility; Disqualification.................................................................6 SECTION 6.11. Preferential Collection of Claims Against Company.............................................6 iii ARTICLE Seven DISCHARGE OF INDENTURE SECTION 7.01. Termination of Company's Obligations..........................................................6 SECTION 7.02. Application of Trust Money....................................................................6 SECTION 7.03. Repayment to Company..........................................................................6 SECTION 7.04. Reinstatement.................................................................................6 ARTICLE Eight AMENDMENTS, SUPPLEMENTS AND WAIVERS SECTION 8.01. Without Consent of Holders....................................................................6 SECTION 8.02. With Consent of Holders.......................................................................6 SECTION 8.03. Compliance with Trust Indenture Act...........................................................6 SECTION 8.04. Revocation and Effect of Consents.............................................................6 SECTION 8.05. Notation on or Exchange of Securities.........................................................6 SECTION 8.06. Trustee Protected.............................................................................6 ARTICLE Nine MISCELLANEOUS SECTION 9.01. Trust Indenture Act Controls..................................................................6 SECTION 9.02. Notices.......................................................................................6 SECTION 9.03. Communication by Holders with Other Holders...................................................6 SECTION 9.04. Certificate and Opinion as to Conditions Precedent............................................6 SECTION 9.05. Statements Required in Certificate or Opinion.................................................6 SECTION 9.06. When Treasury Securities Disregarded..........................................................6 SECTION 9.07. Rules by Trustee and Agents...................................................................6 SECTION 9.08. Legal Holidays................................................................................6 SECTION 9.09. Governing Law.................................................................................6 SECTION 9.10. No Adverse Interpretation of Other Agreements.................................................6 SECTION 9.11. No Recourse Against Others....................................................................6 SECTION 9.12. Successors....................................................................................6 SECTION 9.13. Duplicate Originals...........................................................................6 SECTION 9.14. Separability..................................................................................6 SIGNATURES...............................................................................................................S-1 iv EXHIBIT A-1 - FORM OF RESTRICTED SECURITY..............................................................................A-1-1 EXHIBIT A-2 - FORM OF UNRESTRICTED SECURITY............................................................................A-2-1 EXHIBIT B - FORM OF PRIVATE PLACEMENT LEGEND.............................................................................B-1 EXHIBIT C - FORM OF GLOBAL SECURITY LEGEND...............................................................................C-1 EXHIBIT D - FORM OF REGULATION S TEMPORARY GLOBAL SECURITY LEGEND............................................................................D-1 EXHIBIT E - FORM OF CERTIFICATE OF TRANSFER..............................................................................E-1 EXHIBIT F - FORM OF CERTIFICATE OF EXCHANGE..............................................................................F-1 EXHIBIT G - FORM OF CERTIFICATE FROM ACQUIRING ACCREDITED INVESTOR...............................................................................G-1
- ---------------------- NOTE: This Table of Contents shall not, for any purpose, be deemed to be a part of this Indenture. v INDENTURE dated as of June 5, 2003 between Leucadia National Corporation, a New York corporation (the "Company"), and JPMorgan Chase Bank, as trustee (the "Trustee"). Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the holders of the Company's 7% Senior Notes due August 15, 2013 (the "Securities"): ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE SECTION 1.01. Definitions. "Accredited Investor" means an "accredited investor" as defined in Rule 501(a) promulgated under the Securities Act. "Acquired Indebtedness" means Indebtedness of a Person either (i) existing at the time such Person becomes a Subsidiary, (ii) assumed in connection with the acquisition of assets of such Person or (iii) any refinancing or replacement by such Person of such Indebtedness; provided that the aggregate amount of such Indebtedness then outstanding is not increased. Acquired Indebtedness shall not include (x) any such Indebtedness created in anticipation of such Person becoming a Subsidiary (other than a refinancing or replacement of Indebtedness of such Person, which original Indebtedness was not incurred in anticipation of such Person becoming a Subsidiary) or (y) any Indebtedness that is recourse to the Company or any Subsidiary or any of their respective assets, other than to such Person and its Subsidiaries and their respective assets. "Affiliate" of the Company means (i) any Related Person and (ii) any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company. For the purposes of this definition, "control" when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing. "Agent" means any Registrar, Paying Agent or co-registrar. "Attributable Debt" means, as of any particular time, the present value, discounted at a rate per annum equal to the interest rate borne by the Securities, of the rental payments (not including amounts payable by the lessee for maintenance, property taxes and insurance) due 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). "Board of Directors" means the Board of Directors of the Company or any committee thereof. "Board Resolution" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification, and delivered to the Trustee. "business day" means any day on which the New York Stock Exchange is open for trading and which is not a Legal Holiday. "Capitalized Lease Obligations" means the discounted present value of the rental obligations of any Person under any lease of any property (whether real, personal or mixed) which, in accordance with GAAP, is required to be capitalized on the balance sheet of such Person. "Capital Stock" means, with respect to any Person, any and all shares, interests, participations or other equivalents (however designated) of capital stock, including each class of common stock and preferred stock of such Person. "Clearstream" means Clearstream Banking, S.A., and its successors. "Common Shares" means the Common Shares, par value $1.00 per share, of the Company. "Company" means Leucadia National Corporation, a New York corporation, until a successor replaces such Person in accordance with the terms of this Indenture, and thereafter means such successor. "Consolidated Debt" means, on any date, the sum of (i) total Indebtedness of the Company and its Subsidiaries, at such date, determined in accordance with GAAP on a consolidated basis, and (ii) the aggregate liquidation preference of all Preferred Stock of Subsidiaries of the Company, at such date, other than Preferred Stock to the extent held by the Company and its Subsidiaries; provided that Consolidated Debt shall not include Permitted Indebtedness. "Consolidated Net Worth" means, as of any date, the sum of the Capital Stock and additional paid-in capital plus retained earnings (or minus accumulated deficit) of the Company as of such date determined on a consolidated basis in accordance with GAAP. "Consolidated Tangible Net Worth" with respect to the Company means, as of any date, the total shareholders' equity of the Company determined in accordance with GAAP less any and all goodwill and other intangible assets reflected on the consolidated balance sheet of the Company as of such date. Deferred policy acquisition costs ("DPAC"), that portion of the value of insurance in force resulting from an acquisition and equivalent to the amount of DPAC of the acquired entity outstanding immediately prior to such acquisition and deferred taxes shall not be deemed goodwill or other intangible assets for purposes of determining Consolidated Tangible Net Worth. 2 "Default" means any event which is, or after notice or passage of time would be, an Event of Default. "Depository" means, with respect to the Global Securities, The Depository Trust Company or another Person designated as depository by the Company, which Person must be a clearing agency registered under the Exchange Act. "Euroclear" means Euroclear Bank S.A./N.V., and its successors. "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated by the SEC thereunder. "Exchange Securities" means the Securities issued in exchange for an equal principal amount of Initial Securities pursuant to the exchange offer registered under the Securities Act in accordance with the terms of the Registration Rights Agreement. "Funded Debt" means Indebtedness which by its terms matures at, or can be extended or renewed at the option of the obligor to, a date more than twelve months after the date of the creation of such Indebtedness, including, without limitation, revolving credit loans. "GAAP" or "generally accepted accounting principles" means United States generally accepted accounting principles as in effect on December 31, 1992. "Global Security Legend" means the legend substantially in the form set forth in Exhibit C. "Holder" or "Securityholder" means a Person in whose name a Security is registered on the Registrar's books. "Indebtedness" of any Person means (i) any liability of such Person (a) for borrowed money, (b) evidenced by a note, debenture or similar instrument (including a Purchase Money Obligation or deferred payment obligation) given in connection with the acquisition of any property or assets (other than inventory or similar property acquired in the ordinary course of business), including securities, (c) for the payment of a Capitalized Lease Obligation of such Person or (d) with respect to the reimbursement of any letter of credit, banker's acceptance or similar credit transaction (other than trade letters of credit issued in the ordinary course of business; provided, that the failure to make prompt reimbursement of any trade letter of credit shall be deemed to be the incurrence of Indebtedness); and (ii) any guarantee by such Person of any liability of others described in clause (i) above or any obligation of such Person with respect to any liability of others described in clause (i) above. Indebtedness shall not include deposits at the Company's banking and lending Subsidiaries. "Indenture" means this Indenture as amended or supplemented from time to time. 3 "Independent Director" means any director of the Company who is neither (i) an executive officer or an employee of the Company or of any of its Subsidiaries or Affiliates or (ii) a Related Person. "Initial Purchaser" means Jefferies & Company, Inc. "Initial Securities" means the Securities issued on the date of this Indenture. "Investment Grade" is defined as BBB- or higher by S&P or Baa3 or higher by Moody's or the equivalent of such ratings by Moody's or S&P. "Lien" means any mortgage, lien, pledge, security interest, conditional sale or other title retention agreement or other security interest or encumbrance of any kind (including any agreement to give any security interest). "Material Subsidiary" means (i) any Subsidiary of the Company which at December 31, 1992 was a "significant subsidiary" under Regulation S-X promulgated by the SEC or any successor to such Subsidiary and (ii) any other Subsidiary of the Company; provided, that the Company's investments in and advances to such Subsidiary at the date of determination thereof, without giving effect to any write downs in such investments or advances taken within the prior 12 months, represent 20% or more of the Company's Consolidated Tangible Net Worth as of such time; provided, however, that this clause (ii) shall not include any Subsidiary if, at the time that it became a Subsidiary, the Company contemplated commencing a voluntary case or proceeding under the Bankruptcy Law with respect to such Subsidiary. "Moody's" means Moody's Investors Service, Inc. or any successor to its rating business. "Non-U.S. Person" means a Person who is not a U.S. Person. "Obligations" means any principal, interest, penalties, fees, indemnities and other obligations and liabilities payable under the documentation governing the applicable Indebtedness. "Officer" means the Chairman of the Board, the President, any Vice President, the Chief Financial Officer or the Treasurer of the Company. "Officers' Certificate" means a certificate signed by two Officers or by an Officer and the Secretary, Assistant Secretary or Assistant Treasurer of the Company. One of the Officers giving an Officers' Certificate pursuant to Section 3.03 shall be the principal executive, financial or accounting officer of the Company. 4 "Opinion of Counsel" means a written opinion from legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or the Trustee. "Permitted Indebtedness" means (i) any Indebtedness of the Company and its Subsidiaries outstanding on the date of this Indenture or any refinancing or replacement thereof; provided, that the aggregate amount of such Indebtedness is not increased, (ii) Acquired Indebtedness, (iii) Preferred Stock of Subsidiaries held by the Company or its Subsidiaries (it being understood that the sale of such Preferred Stock by the Company or such Subsidiary to any Person other than the Company or a Subsidiary of the Company or such Subsidiary no longer being a Subsidiary shall be deemed the issuance of Preferred Stock for purposes of Section 3.09) and (iv) intercompany Indebtedness. "Person" means any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. "Physical Securities" means certificated Securities in registered form. "Preferred Stock" of an entity means the Capital Stock of that entity which is preferred as to the payment of dividends or the distribution of assets on any voluntary or involuntary liquidation, over the shares of any other class or series of Capital Stock of said entity. "principal" of a debt security means the principal amount of the security plus the premium, if any, on the security. "Principal Property" means all property, assets or revenue of the Company and of each Material Subsidiary now owned or hereafter acquired and all shares of stock and Indebtedness of any Material Subsidiary now owned or hereafter acquired. "Private Placement Legend" means the legend substantially in the form set forth in Exhibit B. "Purchase Money Obligations" means Indebtedness evidenced by a note, debenture, bond or other security or investment (whether or not secured by any Lien or other security interest) issued to or assumed in favor of a vendor as all or part of the purchase price of property acquired by the Company or any Subsidiary; provided, however, that such term shall not include any account payable or any other Indebtedness incurred, created or assumed in the ordinary course of business in connection with the obtaining of material, products or services. "Qualified Institutional Buyer" means a "qualified institutional buyer" as defined in Rule 144A promulgated under the Securities Act. 5 "Registration Rights Agreement" means the registration rights agreement dated June 5, 2003 between the Company and the Initial Purchaser relating to the Securities, as amended or supplemented from time to time. "Regulation S Global Security" means the Regulation S Temporary Global Security or the Regulation S Permanent Global Security, as appropriate. "Regulation S Permanent Global Security" means one or more permanent Regulation S Securities in registered, global form without interest coupons, issued in a denomination equal to the outstanding principal amount of the Regulation S Temporary Global Security upon expiration of the Restricted Period. "Regulation S Temporary Global Security" means one or more temporary Regulation S Securities in registered, global form without interest coupons, issued in denominations equal to the outstanding principal amount of Regulation S Securities initially sold. "Regulation S Temporary Global Security Legend" means the legend substantially in the form of Exhibit D. "Related Person" means any Person who directly or indirectly holds 10% or more of any class of Capital Stock of the Company as determined pursuant to Rule 13d-3 under the Exchange Act. "Restricted Global Security" means a Global Security that is a Restricted Security. "Restricted Period" means the 40-day "restricted period" as defined in Regulation S under the Securities Act. "Restricted Physical Security" means a Physical Security that is a Restricted Security. "Restricted Security" means a Security that is a "restricted security" as defined in Rule 144(a)(3) promulgated under the Securities Act; provided that the Trustee shall be entitled to request and conclusively rely upon an Opinion of Counsel with respect to whether any Security is a Restricted Security. "Sale and Lease-Back Transaction" means an arrangement with any Person providing for the leasing by the Company or any Subsidiary of any property, title to which property has been or is to be sold or transferred by the Company or such Subsidiary to such Person; provided, however, that the term "Sale and Lease-Back Transaction" shall not include any arrangement with the United States of America, any of its territories or possessions, or any State thereof, or any department, agency, instrumentality or political subdivision of any thereof. 6 "S&P" means Standard & Poor's Ratings Group, Inc. or any successor to its rating business. "SEC" means the Securities and Exchange Commission. "Securities" means the securities, as amended or supplemented from time to time, that are issued and outstanding under this Indenture, treated as a single class of securities, including the Initial Securities and the Exchange Securities. "Subsidiary" means a corporation or business trust a majority of whose Voting Stock is owned by the Company or a Subsidiary. "TIA" means the Trust Indenture Act of 1939 (15 U.S. Codess.ss.77aaa-77bbbb) as in effect on the date of this Indenture; provided, however, that in the event the Trust Indenture Act of 1939 is amended after such date, "TIA" means to the extent required by any such amendment, the Trust Indenture Act of 1939 as so amended. "Trustee" means the party named as such in this Indenture until a successor replaces it and thereafter means the successor. "Trust Officer" means any officer or assistant officer within the corporate trust department of the Trustee with direct responsibilities for the administration of this Indenture. "United States" means the United States of America. "Unrestricted Global Security" means a Global Security that is not a Restricted Security. "Unrestricted Physical Security" means a Physical Security that is not a Restricted Security. "Unrestricted Security" means a Security that is not a Restricted Security. "U.S. Legal Tender" means such coin or currency of the United States as at the time of payment shall be legal tender for the payment of public and private debts. "U.S. Person" means a "U.S. person" as defined in Rule 902(k) promulgated under the Securities Act. "Voting Stock" with respect to any Person, means Capital Stock of such Person having general voting power under ordinary circumstances to elect directors to the board of directors of such Person, but shall not include any Capital Stock that has or would have such voting power solely by reason of the happening of any contingency. 7 "Wholly-Owned Subsidiary" means any Subsidiary in which the Company or a Subsidiary owns all of the Capital Stock, other than directors' qualifying shares. SECTION 1.02. Other Definitions. Defined Term in Section - ---- ---------- "Agent Members"............................................... 2.12 "Bankruptcy Law".............................................. 5.01 "Change of Control"........................................... 3.08 "Change of Control Notice".................................... 3.08 "Change of Control Payment Date".............................. 3.08 "Custodian"................................................... 5.01 "Disposition"................................................. 3.08 "Event of Default"............................................ 5.01 "Global Securities"........................................... 2.12 "Legal Holiday"............................................... 9.08 "Market Price"................................................ 3.08 "Market Value"................................................ 3.08 "Paying Agent"................................................ 2.03 "Recipient"................................................... 3.08 "Registrar"................................................... 2.03 "Regulation S Securities"..................................... 2.01 "Rule 144A Global Security"................................... 2.12 "Rule 144A Securities"........................................ 2.01 "Rule 501 Global Security".................................... 2.12 "Rule 501 Securities"......................................... 2.01 "Trading Day"................................................. 3.08 "U.S. Government Obligations"................................. 7.01 SECTION 1.03. Incorporation by Reference of Trust Indenture Act. Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. The following TIA terms, if used in this Indenture, have the following meanings: "Commission" means the SEC. "indenture securities" means the Securities. "indenture security holder" means a securityholder. 8 "indenture to be qualified" means this Indenture. "indenture trustee" or "institutional trustee" means the Trustee. "obligor" on the indenture securities means the Company. All other TIA terms used in this indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule have the meanings assigned to them therein. SECTION 1.04. Rules of Construction. Unless the context otherwise requires: (1) a term has the meaning assigned to it; (2) an accounting term not otherwise defined has the meaning assigned to it in accordance with generally accepted accounting principles; (3) "or" is not exclusive; (4) words in the singular include the plural, and words in the plural include the singular; (5) any gender used in this Indenture shall be deemed to include the neuter, masculine or feminine genders; (6) provisions apply to successive events and transactions; and (7) "herein", "hereof" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision. ARTICLE TWO THE SECURITIES SECTION 2.01. Form and Dating. The Securities and the certificate of authentication shall be substantially in the form of Exhibit A-1 (in the case of the Restricted Securities) and Exhibit A-2 (in the case of Unrestricted Securities). The provisions of Exhibit A-1 and Exhibit A-2 are part of this Indenture. The Securities may have notations, legends and endorsements required by law, stock exchange rule or usage. Without limiting the generality of the foregoing, Securities offered and sold in reliance on Rule 144A under the Securities Act ("Rule 144A Securities"), Securities offered and sold to Accredited Investors 9 ("Rule 501 Securities"), Securities offered and sold in offshore transactions in reliance on Regulation S under the Securities Act ("Regulation S Securities") and all other Restricted Securities shall bear the Private Placement Legend. The Company shall approve the form of the Securities and any notation, legend or endorsement on them. Each Security shall be dated the date of its authentication. SECTION 2.02. Execution and Authentication. One Officer and the Secretary or an Assistant Secretary of the Company shall sign the Securities for the Company by manual or facsimile signature. If an Officer whose signature is on a Security no longer holds that office at the time the Security is authenticated, the Security shall be valid nevertheless. A Security shall not be valid until the Trustee or an authenticating agent manually signs the certificate of authentication on the Security. The signature shall be conclusive evidence that the Security has been authenticated under this Indenture. The Trustee or an authenticating agent shall authenticate Securities for original issue in the aggregate principal amount of $200,000,000, upon a written order of the Company signed by two Officers or by an Officer and the Secretary or an Assistant Secretary of the Company. The aggregate principal amount of Securities outstanding at any time may not exceed $200,000,000 except as provided in Section 2.07. The Trustee may appoint an authenticating agent to authenticate Securities. An authenticating agent may authenticate Securities whenever the Trustee may do so except on original issuance. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with the Company or its Affiliates. The Securities shall be issuable only in registered form without coupons and only in denominations of $1,000 and any integral multiple thereof. SECTION 2.03. Registrar and Paying Agent. The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange (the "Registrar") and an office or agency where Securities may be presented for payment (the "Paying Agent"). The Registrar shall keep a register of the Securities and of their transfer and exchange. The Company may have one or more co-registrars and one or more additional paying agents. The term "Paying Agent" includes any additional paying agent. 10 The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture. Such agency agreement shall provide for reasonable compensation for such services. The agreement shall implement the provisions of this Indenture that relate to such Agent. The Company shall notify the Trustee of the name and address of any such Agent and shall furnish the Trustee with an executed counterpart of any such agency agreement. If the Company fails to maintain or act as Registrar or Paying Agent, the Trustee shall act as such and shall be duly compensated therefor. The Registrar or a co-registrar and a Paying Agent shall be maintained by the Company in the Borough of Manhattan, The City of New York. The Company initially designates the Trustee as the Registrar and Paying Agent. SECTION 2.04. Paying Agent To Hold Money in Trust. At or prior to 10:00 A.M., New York City time, on each due date of the principal and interest on any Security, the Company shall deposit with the Paying Agent immediately available funds sufficient to pay such principal and interest becoming due. The Company shall require each Paying Agent other than the Trustee to hold in trust for the benefit of Securityholders or the Trustee all money held by such Paying Agent for the payment of principal or interest on the Securities, and shall notify the Trustee of any Default by the Company in making any such payment. While any such Default continues, the Trustee may require the Paying Agent to pay all money held by it to the Trustee. Except as provided in the immediately preceding sentence, the Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon doing so, such Paying Agent (other than the Company or a Subsidiary) shall have no further liability for the money. If the Company acts as Paying Agent, it shall segregate and hold as separate trust funds all money held by it as Paying Agent. SECTION 2.05. Securityholder Lists. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the name and addresses of Securityholders and shall otherwise comply with TIA ss. 312(a). If the Trustee is not the Registrar, the Company shall furnish or cause to be furnished to the Trustee on or before each semiannual interest payment date and at such other times as the Trustee may request in writing a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Securityholders, and the Company shall otherwise comply with TIA ss. 312(a). SECTION 2.06. Transfer and Exchange. Subject to Sections 2.12 and 2.13, when a Security is presented to the Registrar or a co-registrar with a request to register a transfer, the Registrar shall register the transfer as requested if the requirements of the Registrar are met. Subject to Sections 2.12 and 2.13, when Securities are presented to the Registrar or a co-registrar with a request to exchange them for an equal principal amount of Securities of other 11 denominations, the Registrar shall make the exchange as requested if the requirements of the Registrar are met. The Company shall cooperate with the Registrar in meeting its requirements. To permit registrations of transfers and exchanges, the Trustee shall authenticate Securities at the Registrar's request. The Company or the Trustee may charge a reasonable fee for any registration of transfer or exchange and may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto, but not for any exchange pursuant to Sections 2.09 or 8.05. SECTION 2.07. Replacement Securities. If a mutilated Security is surrendered to the Trustee or if the Holder of a Security claims that the Security has been lost, destroyed or wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Security if the requirements of the Trustee are met. An indemnity bond may be required by the Trustee or the Company that is sufficient in the judgment of the Company and the Trustee to protect the Company, the Trustee or any Agent from any loss which any of them may suffer if a Security is replaced. The Company or the Trustee may charge for its expenses in replacing a Security. SECTION 2.08. Outstanding Securities. Securities outstanding at any time are all Securities authenticated by the Trustee except for those cancelled by it, those delivered to it for cancellation and those described in this Section 2.08 as not outstanding. Subject to Section 9.06, a Security does not cease to be outstanding because the Company or one of its Subsidiaries or Affiliates holds the Security. If a Security is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Security is held by a protected purchaser. If any Paying Agent (other than the Company or a Subsidiary) holds on a redemption date or maturity date money received by the Paying Agent pursuant to this Indenture and sufficient to pay the principal and interest on Securities payable on that date, then on and after that date such Securities cease to be outstanding and interest on them ceases to accrue. SECTION 2.09. Temporary Securities. Until definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate the temporary Securities. Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company considers appropriate for temporary Securities. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate definitive Securities in exchange for temporary Securities surrendered to it. 12 SECTION 2.10. Cancellation. The Company at any time may deliver Securities to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment. The Trustee and no one else shall cancel all Securities surrendered for registration of transfer, exchange, payment or cancellation and shall dispose of cancelled Securities in accordance with its customary procedures unless the Company directs in writing their return to the Company. The Company may not issue new Securities to replace Securities that it has paid or delivered to the Trustee for cancellation. SECTION 2.11. Defaulted Interest. If the Company defaults in a payment of interest on the Securities, it shall pay the defaulted interest plus any interest payable on the defaulted interest to the Persons who are Securityholders on a subsequent special record date. The Company shall fix the record date and payment date. At least 10 days before the record date, the Company shall mail to each Securityholder a notice that states the record date, the payment date, and the amount of defaulted interest to be paid. The Company may pay defaulted interest in any other lawful manner. SECTION 2.12. Book-Entry Provisions for Global Securities. (a) Rule 144A Securities initially shall be represented by one or more Securities in registered, global form without interest coupons (collectively, the "Rule 144A Global Security"). Rule 501 Securities initially shall be represented by one or more Securities in registered, global form without interest coupons (collectively, the "Rule 501 Global Security"). Regulation S Securities initially shall be represented by the Regulation S Temporary Global Security. Following the termination of the Restricted Period, beneficial interests in the Regulation S Temporary Global Security shall be exchanged for beneficial interests in Regulation S Permanent Global Security pursuant to the applicable rules and procedures of the Depositary, Euroclear and Clearstream that apply to such transfer. Simultaneously with the authentication of Regulation S Permanent Global Security, the Trustee shall cancel the Regulation S Temporary Global Security. The term "Global Securities" means the Rule 144A Global Security, the Rule 501 Global Security and the Regulation S Global Security. All Global Securities shall bear the Global Security Legend. The Global Securities initially shall (i) be registered in the name of the Depository or the nominee of the Depository, in each case for credit to an account of an Agent Member, (ii) be delivered to the Trustee as custodian for the Depository and (iii) bear the Private Placement Legend. The Regulation S Temporary Global Security shall bear the Regulation S Temporary Global Security Legend. Members of, or direct or indirect participants in, the Depository ("Agent Members") shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depository or under 13 the Global Securities. The Depository may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of the Global Securities for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depository or impair, as between the Depository and its Agent Members, the operation of customary practices governing the exercise of the rights of a Holder of any Security. (b) Transfers of Global Securities shall be limited to transfers in whole, but not in part, to the Depository, its successors or their respective nominees. Interests of beneficial owners in the Global Securities may be transferred or exchanged for Physical Securities only in accordance with the applicable rules and procedures of the Depository and the provisions of Section 2.13. In addition, a Global Security shall be exchangeable for Physical Securities only if (i) the Depository (x) notifies the Company that it is unwilling or unable to continue as depository for such Global Security or (y) has ceased to be a clearing agency registered under the Exchange Act, and in either case the Company fails to appoint a successor depositary within 90 days of such notice, (ii) the Company, at its option, notifies the Trustee in writing that it is electing to issue Physical Securities or (iii) there shall have occurred and be continuing an Event of Default with respect to such Global Security. In all cases, Physical Securities delivered in exchange for any Global Security or beneficial interests therein shall be registered in the names, and issued in any approved denominations, requested by or on behalf of the Depository in accordance with its customary procedures. (c) In connection with the transfer of a Global Security as an entirety to beneficial owners pursuant to subsection (b) of this Section 2.12, such Global Security shall be deemed to be surrendered to the Trustee for cancellation, and the Company shall execute, and the Trustee shall authenticate and deliver, to each beneficial owner identified by the Depository in writing in exchange for its beneficial interest in such Global Security, an equal aggregate principal amount of Physical Securities of authorized denominations. (d) Any Restricted Physical Security delivered in exchange for an interest in a Global Security pursuant to Section 2.13 shall, except as otherwise provided in Section 2.13, bear the Private Placement Legend. (e) Notwithstanding the foregoing, until the termination of the Restricted Period, a beneficial interest in the Regulation S Temporary Global Security may be held only through Euroclear or Clearstream unless delivery is made in accordance with the applicable provisions of Section 2.13. (f) The Holder of any Global Security may grant proxies and otherwise authorize any Person, including Agent Members and Persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Securities. 14 SECTION 2.13. Transfer and Exchange of Securities. (a) Transfer and Exchange of Global Securities. A Global Security may not be transferred as a whole except as set forth in Section 2.12(b). Global Securities shall not be exchanged by the Company for Physical Securities except under the circumstances described in Section 2.12(b). Global Securities may be exchanged or replaced, in whole or in part, as provided in Sections 2.07 and 2.09. Beneficial interests in a Global Security may be transferred and exchanged as provided in Section 2.13(b), 2.13(f) or 2.13(h) below. (b) Transfer and Exchange of Beneficial Interests in Global Securities. The transfer and exchange of beneficial interests in the Global Securities shall be effected through the Depository, in accordance with the provisions of this Indenture and the applicable rules and procedures of the Depository. Beneficial interests in Restricted Global Securities shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by the Securities Act. Beneficial interests in Global Securities shall be transferred or exchanged only for beneficial interests in Global Securities. Transfers and exchanges of beneficial interests in the Global Securities also shall require compliance with either subparagraph (i) or (ii) below, as applicable, as well as one or more of the other following subparagraphs, as applicable: (i) Transfer of Beneficial Interests in the Same Global Security. Beneficial interests in any Restricted Global Security may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the same Restricted Global Security in accordance with the transfer restrictions set forth in the Private Placement Legend; provided, however, that prior to the expiration of the Restricted Period, transfers of beneficial interests in the Regulation S Temporary Global Security may not be made to a U.S. Person or for the account or benefit of a U.S. Person (other than the Initial Purchaser). A beneficial interest in an Unrestricted Global Security may be transferred to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security. No written orders or instructions shall be required to be delivered to the Registrar to effect the transfers described in this Section 2.13(b)(i). (ii) All Other Transfers and Exchanges of Beneficial Interests in Global Securities. In connection with all transfers and exchanges of beneficial interests in any Global Security that is not subject to Section 2.13(b)(i), the transferor of such beneficial interest must deliver to the Registrar (1) a written order from an Agent Member given to the Depository in accordance with the applicable rules and procedures of the Depository directing the Depository to credit or cause to be credited a beneficial interest in another Global Security in an amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given in accordance with the applicable rules and procedures of the Depository containing information regarding the Agent Member account to be credited with such increase. Upon satisfaction of all of the requirements for transfer or exchange of beneficial interests in Global Securities contained in this Indenture and the Securities or 15 otherwise applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Security or Global Securities pursuant to Section 2.13(f). (iii) Transfer of Beneficial Interests to Another Restricted Global Security. A beneficial interest in a Restricted Global Security may be transferred to a Person who takes delivery thereof in the form of a beneficial interest in another Restricted Global Security if the transfer complies with the requirements of Section 2.13(b)(ii) above and the Registrar receives the following: (A) if the transferee will take delivery in the form of a beneficial interest in a Rule 144A Global Security, then the transferor must deliver a certificate in the form of Exhibit E, including the certifications in item (1) thereof; (B) if the transferee will take delivery in the form of a beneficial interest in a Rule 501 Global Security, then the transferor must deliver a certificate in the form of Exhibit E, including the certifications, certificates and Opinion of Counsel required by item (3)(d) thereof, if applicable; and (C) if the transferee will take delivery in the form of a beneficial interest in a Regulation S Global Security, then the transferor must deliver a certificate in the form of Exhibit E, including the certifications in item (2) thereof. (iv) Transfer and Exchange of Beneficial Interests in a Restricted Global Security for Beneficial Interests in an Unrestricted Global Security. A beneficial interest in a Restricted Global Security may be exchanged by any Holder thereof for a beneficial interest in an Unrestricted Global Security or transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security if the exchange or transfer complies with the requirements of Section 2.13(b)(ii) above and: (A) such exchange or transfer is effected pursuant to the exchange offer registered under the Securities Act in accordance with the Registration Rights Agreement and the Holder of the beneficial interest to be transferred, in the case of an exchange, or the transferee, in the case of a transfer, certifies in the applicable letter of transmittal that it is not (1) a broker-dealer, (2) a Person participating in the distribution of the Exchange Securities or (3) a Person who is an "affiliate" (as defined in Rule 144) of the Company; (B) such transfer is effected pursuant to the shelf registration statement in accordance with the Registration Rights Agreement; (C) such transfer is effected by a broker-dealer pursuant to the shelf registration statement in accordance with the Registration Rights Agreement; or 16 (D) the Registrar receives the following: (1) if the Holder of such beneficial interest in a Restricted Global Security proposes to exchange such beneficial interest for a beneficial interest in an Unrestricted Global Security, a certificate from such Holder in the form of Exhibit F, including the certifications in item (1)(a) thereof; or (2) if the Holder of such beneficial interest in a Restricted Global Security proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security, a certificate from such Holder in the form of Exhibit E, including the certifications in item (4) thereof, and, in each such case set forth in this subparagraph (D), if the Registrar so requests or if the applicable rules and procedures of the Depositary, so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. If any such transfer or exchange is effected pursuant to this subparagraph (iv) at a time when an Unrestricted Global Security has not yet been issued, the Company shall issue and, upon receipt of an written order of the Company in accordance with Section 2.02, the Trustee shall authenticate one or more Unrestricted Global Securities in an aggregate principal amount equal to the aggregate principal amount of beneficial interests transferred or exchanged pursuant to this subparagraph (iv). (v) Transfer and Exchange of Beneficial Interests in an Unrestricted Global Security for Beneficial Interests in a Restricted Global Security. Beneficial interests in an Unrestricted Global Security cannot be exchanged for, or transferred to Persons who take delivery thereof in the form of, a beneficial interest in a Restricted Global Security. (c) Transfer and Exchange of Beneficial Interests in Global Securities for Physical Securities. A beneficial interest in a Global Security may not be exchanged for a Physical Security except under the circumstances described in Section 2.12(b). A beneficial interest in a Global Security may not be transferred to a Person who takes delivery thereof in the form of a Physical Security except under the circumstances described in Section 2.12(b). (d) Transfer and Exchange of Physical Securities for Beneficial Interests in Global Securities. Physical Securities may be transferred or exchanged for beneficial interests in Global Securities if the transfer or exchange complies with either subparagraph (i), (ii) or (iii) below, as applicable: 17 (i) Restricted Physical Securities to Beneficial Interests in Restricted Global Securities. If any Holder of a Restricted Physical Security proposes to exchange such Restricted Physical Security for a beneficial interest in a Restricted Global Security or to transfer such Restricted Physical Security to a Person who takes delivery thereof in the form of a beneficial interest in a Restricted Global Security, then, upon receipt by the Registrar of the following documentation: (A) if the Holder of such Restricted Physical Security proposes to exchange such Restricted Physical Security for a beneficial interest in a Restricted Global Security, a certificate from such Holder in the form of Exhibit F, including the certifications in item (2)(a) thereof; (B) if such Restricted Physical Security is being transferred to a Qualified Institutional Buyer in accordance with Rule 144A under the Securities Act, a certificate to the effect set forth in Exhibit E, including the certifications in item (1) thereof; (C) if such Restricted Physical Security is being transferred to a Non-U.S. Person in an offshore transaction in accordance with Rule 903 or Rule 904 under the Securities Act, a certificate to the effect set forth in Exhibit E, including the certifications in item (2) thereof; (D) if such Restricted Physical Security is being transferred pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate to the effect set forth in Exhibit E, including the certifications in item (3)(a) thereof; (E) if such Restricted Physical Security is being transferred to an Accredited Investor in reliance on an exemption from the registration requirements of the Securities Act other than those listed in subparagraphs (B) through (D) above, a certificate to the effect set forth in Exhibit E, including the certifications, certificates and Opinion of Counsel required by item (3)(d) thereof, if applicable; or (F) if such Restricted Physical Security is being transferred to the Company or a Subsidiary thereof, a certificate to the effect set forth in Exhibit E, including the certifications in item (3)(b) thereof, the Trustee shall cancel the Restricted Physical Security, and increase or cause to be increased the aggregate principal amount of the appropriate Restricted Global Security. (ii) Restricted Physical Securities to Beneficial Interests in Unrestricted Global Securities. A Holder of a Restricted Physical Security may exchange such Restricted Physical Security for 18 a beneficial interest in an Unrestricted Global Security or transfer such Restricted Physical Security to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security only if: (A) such exchange or transfer is effected pursuant to the exchange offer registered under the Securities Act in accordance with the Registration Rights Agreement and the Holder of the beneficial interest to be transferred, in the case of an exchange, or the transferee, in the case of a transfer, certifies in the applicable letter of transmittal that it is not (1) a broker-dealer, (2) a Person participating in the distribution of the Exchange Securities or (3) a Person who is an "affiliate" (as defined in Rule 144) of the Company; (B) such transfer is effected pursuant to the shelf registration statement in accordance with the Registration Rights Agreement; (C) such transfer is effected by a broker-dealer pursuant to the shelf registration statement in accordance with the Registration Rights Agreement; or (D) the Registrar receives the following: (1) if the Holder of such Restricted Physical Security proposes to exchange such Restricted Physical Security for a beneficial interest in an Unrestricted Global Security, a certificate from such Holder in the form of Exhibit F, including the certifications in item (1)(b) thereof; or (2) if the Holder of such Restricted Physical Securities proposes to transfer such Restricted Physical Security to a Person who shall take delivery thereof in the form of a beneficial interest in an Unrestricted Global Security, a certificate from such Holder in the form of Exhibit E, including the certifications in item (4) thereof, and, in each such case set forth in this subparagraph (D), if the Registrar so requests or if the applicable rules and procedures of the Depositary, so require, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. Upon satisfaction of the conditions of this subparagraph (ii), the Trustee shall cancel the Restricted Physical Security and increase or cause to be increased the aggregate principal amount of the Unrestricted Global Security. If any such transfer or exchange is effected pursuant to this subparagraph (ii) at a time when an Unrestricted Global Security has not yet been issued, the Company shall issue and, upon receipt of an written order of the Company in 19 accordance with Section 2.02, the Trustee shall authenticate one or more Unrestricted Global Securities in an aggregate principal amount equal to the aggregate principal amount of Restricted Physical Securities transferred or exchanged pursuant to this subparagraph (ii). (iii) Unrestricted Physical Securities to Beneficial Interests in Unrestricted Global Securities. A Holder of an Unrestricted Physical Security may exchange such Unrestricted Physical Security for a beneficial interest in an Unrestricted Global Security or transfer such Unrestricted Physical Security to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Security at any time. Upon receipt of a request for such an exchange or transfer, the Trustee shall cancel the applicable Unrestricted Physical Security and increase or cause to be increased the aggregate principal amount of one of the Unrestricted Global Securities. If any such transfer or exchange is effected pursuant to this subparagraph (iii) at a time when an Unrestricted Global Security has not yet been issued, the Company shall issue and, upon receipt of an written order of the Company in accordance with Section 2.02, the Trustee shall authenticate one or more Unrestricted Global Securities in an aggregate principal amount equal to the aggregate principal amount of Unrestricted Physical Securities transferred or exchanged pursuant to this subparagraph (iii). (iv) Unrestricted Physical Securities to Beneficial Interests in Restricted Global Securities. An Unrestricted Physical Security cannot be exchanged for, or transferred to a Person who takes delivery thereof in the form of, a beneficial interest in a Restricted Global Security. (e) Transfer and Exchange of Physical Securities for Physical Securities. Upon request by a Holder of Physical Securities and such Holder's compliance with the provisions of this Section 2.13(e), the Registrar shall register the transfer or exchange of Physical Securities. Prior to such registration of transfer or exchange, the requesting Holder shall present or surrender to the Registrar the Physical Securities duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Registrar duly executed by such Holder or by its attorney, duly authorized in writing. In addition, the requesting Holder shall provide any additional certifications, documents and information, as applicable, required pursuant to the following provisions of this Section 2.13(e). (i) Restricted Physical Securities to Restricted Physical Securities. A Restricted Physical Security may be transferred to and registered in the name of a Person who takes delivery thereof in the form of a Restricted Physical Security if the Registrar receives the following: (A) if the transfer will be made pursuant to Rule 144A under the Securities Act, then the transferor must deliver a certificate in the form of Exhibit E, including the certifications in item (1) thereof; 20 (B) if the transfer will be made pursuant to Rule 903 or Rule 904 under the Securities Act, then the transferor must deliver a certificate in the form of Exhibit E, including the certifications in item (2) thereof; (C) if the transfer will be made pursuant to an exemption from the registration requirements of the Securities Act in accordance with Rule 144 under the Securities Act, a certificate to the effect set forth in Exhibit E, including the certifications in item (3)(a) thereof; (D) if the transfer will be made to an Accredited Investor in reliance on an exemption from the registration requirements of the Securities Act other than those listed in subparagraphs (A) through (C) above, a certificate to the effect set forth in Exhibit E, including the certifications, certificates and Opinion of Counsel required by item (3)(d) thereof, if applicable; and (E) if such transfer will be made to the Company or a Subsidiary thereof, a certificate to the effect set forth in Exhibit E, including the certifications in item (3)(b) thereof. (ii) Restricted Physical Securities to Unrestricted Physical Securities. Any Restricted Physical Security may be exchanged by the Holder thereof for an Unrestricted Physical Security or transferred to a Person who takes delivery thereof in the form of an Unrestricted Physical Security if: (A) such exchange or transfer is effected pursuant to the exchange offer registered under the Securities Act in accordance with the Registration Rights Agreement and the Holder of the beneficial interest to be transferred, in the case of an exchange, or the transferee, in the case of a transfer, certifies in the applicable letter of transmittal that it is not (1) a broker-dealer, (2) a Person participating in the distribution of the Exchange Securities or (3) a Person who is an "affiliate" (as defined in Rule 144) of the Company; (B) such transfer is effected pursuant to the shelf registration statement in accordance with the Registration Rights Agreement; (C) such transfer is effected by a broker-dealer pursuant to the shelf registration statement in accordance with the Registration Rights Agreement; or (D) the Registrar receives the following: (1) if the Holder of such Restricted Physical Security proposes to exchange such Restricted Physical Security for an Unrestricted 21 Physical Security, a certificate from such Holder in the form of Exhibit F, including the certifications in item (1)(c) thereof; or (2) if the Holder of such Restricted Physical Security proposes to transfer such Securities to a Person who shall take delivery thereof in the form of an Unrestricted Physical Security, a certificate from such Holder in the form of Exhibit E, including the certifications in item (4) thereof, and, in each such case set forth in this subparagraph (D), if the Registrar so requests, an Opinion of Counsel in form reasonably acceptable to the Registrar to the effect that such exchange or transfer is in compliance with the Securities Act and that the restrictions on transfer contained herein and in the Private Placement Legend are no longer required in order to maintain compliance with the Securities Act. (iii) Unrestricted Physical Securities to Unrestricted Physical Securities. A Holder of an Unrestricted Physical Security may transfer such Unrestricted Physical Securities to a Person who takes delivery thereof in the form of an Unrestricted Physical Security at any time. Upon receipt of a request to register such a transfer, the Registrar shall register the Unrestricted Physical Securities pursuant to the instructions from the Holder thereof. (iv) Unrestricted Physical Securities to Restricted Physical Securities. An Unrestricted Physical Security cannot be exchanged for, or transferred to a Person who takes delivery thereof in the form of, a Restricted Physical Security. (f) Cancellation and/or Adjustment of Global Securities. At such time as all beneficial interests in a particular Global Security have been exchanged for Physical Securities or a particular Global Security has been redeemed, repurchased or canceled in whole and not in part, each such Global Security shall be returned to or retained and canceled by the Trustee in accordance with Section 2.10. At any time prior to such cancellation, if any beneficial interest in a Global Security is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Security or for Physical Securities, the principal amount of Securities represented by such Global Security shall be reduced accordingly and an endorsement shall be made on such Global Security by the Trustee or by the Depository at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Security, such other Global Security shall be increased accordingly and an endorsement shall be made on such Global Security by the Trustee or by the Depository at the direction of the Trustee to reflect such increase. 22 (g) Private Placement Legend. Upon the registration of transfer, exchange or replacement of Securities not bearing the Private Placement Legend, the Registrar shall deliver Securities that do not bear the Private Placement Legend. Upon the registration of transfer, exchange or replacement of Securities bearing the Private Placement Legend, the Registrar shall deliver only Securities that bear the Private Placement Legend unless (i) there is delivered to the Registrar an Opinion of Counsel reasonably satisfactory to the Registrar to the effect that neither such legend nor the related restrictions on transfer are required in order to maintain compliance with the provisions of the Securities Act or (ii) such Security has been sold pursuant to an effective registration statement under the Securities Act and the Registrar has received an Officers' Certificate from the Company to such effect. (h) Exchange Offer. Upon the occurrence of the exchange offer registered under the Securities Act in accordance with the Registration Rights Agreement, the Company shall issue and, upon receipt of a written order of the Company in accordance with Section 2.02, the Trustee shall authenticate (i) one or more Unrestricted Global Securities in an aggregate principal amount equal to the principal amount of the beneficial interests in the Restricted Global Securities that are (A) tendered for acceptance by Persons that certify in the applicable letter(s) of transmittal that (1) they are not broker-dealers, (2) they are not participating in a distribution of the Exchange Securities and (3) they are not "affiliates" (as defined in Rule 144 under the Securities Act) of the Company and (B) accepted for exchange in such exchange offer and (ii) Unrestricted Physical Securities in an aggregate principal amount equal to the principal amount of the Restricted Physical Securities that are (A) tendered for acceptance by Persons that certify in the applicable letter(s) of transmittal that (1) they are not broker-dealers, (2) they are not participating in a distribution of the Exchange Securities and (3) they are not "affiliates" (as defined in Rule 144 under the Securities Act) of the Company and (B) accepted for exchange in such exchange offer. Concurrently with the issuance of such Securities, the Trustee shall cause the aggregate principal amount of the applicable Restricted Global Securities to be reduced accordingly, and the Company shall execute and the Trustee shall authenticate and deliver to the Persons designated by the Holders of Physical Securities so tendered and accepted Physical Securities in the appropriate principal amount. (i) General. All Global Securities and Physical Securities issued upon any registration of transfer or exchange of Global Securities or Physical Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Global Securities or Physical Securities surrendered upon such registration of transfer or exchange. The Registrar shall retain for a period of two years copies of all letters, notices and other written communications received pursuant to Section 2.12 or this Section 2.13. The Company shall have the right to inspect and make copies of all such letters, notices or other written communications at any reasonable time upon the giving of reasonable notice to the Registrar. 23 ARTICLE THREE COVENANTS SECTION 3.01. Payment of Securities. The Company shall pay the principal of and interest on the Securities on the dates and in the manner provided in the Securities. An installment of principal or interest shall be considered paid on the date it is due if the Trustee or Paying Agent holds such installment in immediately available funds at 9:00 A.M., New York City time, on the date such installment is due. Principal and interest on Global Securities shall be payable to the Depository or its nominee, as the case may be, as the sole registered owner and the sole Holder of the Securities represented thereby. The Company shall pay interest on overdue principal at the rate borne by the Securities; it shall pay interest on overdue installments of interest at the same rate to the extent lawful. SECTION 3.02. SEC Reports. (a) The Company shall file with the Trustee within 15 days after it files them with the SEC copies of the annual reports and of the information, documents, and other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe) which the Company is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. If the Company is not subject to the requirements of such Section 13 or 15(d) of the Exchange Act, the Company shall continue to file with the Trustee on the same timely basis such reports, information and other documents as it would file if it were subject to the requirements of Section 13 or 15(d) of the Exchange Act. The Company also shall comply with the other provisions of TIA ss. 314(a). (b) So long as any of the Securities remain outstanding, the Company shall cause each annual, quarterly and other financial report mailed or otherwise furnished by it generally to stockholders to be filed with the Trustee and mailed to the Holders at their addresses appearing in the register of Securities maintained by the Registrar, in each case at the time of such mailing or furnishing to stockholders. If the Company is not required to furnish annual or quarterly reports to its stockholders pursuant to the Exchange Act, the Company shall cause its financial statements, including any notes thereto and, with respect to annual reports, an auditors' report by an accounting firm of established national reputation and a "Management's Discussion and Analysis of Financial Condition and Results of Operations," comparable to that which would have been required to appear in annual or quarterly reports filed under Section 13 or 15(d) of the Exchange Act, to be so filed with the Trustee within 120 days after the end of each of the Company's fiscal years and within 60 days after the end of each of the first three quarters of each such fiscal year and, 24 after the date such reports are so required to be filed with the Trustee, to be furnished to any Holder upon such Holder's request. (c) The Company shall provide the Trustee with a sufficient number of copies of all reports and other documents and information that the Trustee may be required to deliver to Securityholders under this Section 3.02. Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee's receipt of such reports shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company's compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers' Certificates). SECTION 3.03. Compliance Certificate. The Company shall deliver to the Trustee within 120 days after the end of each fiscal year of the Company (which as of the date of this Indenture is December 31) an Officers' Certificate stating whether or not the signers know of any Default or Event of Default. If they do know of such a Default or Event of Default, the certificate shall describe the Default or Event of Default and efforts to remedy the same. The Company shall notify the Trustee within 10 days following the occurrence thereof of any acceleration which is an Event of Default within the meaning of Section 5.01(4). SECTION 3.04. Maintenance of Office or Agency. The Company will maintain in the Borough of Manhattan, The City of New York, an office or agency where Securities may be surrendered for registration of transfer or exchange or for presentation for payment and where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the address of the Trustee set forth in Section 9.02. The Company may also from time to time designate one or more other offices or agencies where the Securities may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in the Borough of Manhattan, The City of New York, for such purposes. The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency. 25 SECTION 3.05. Corporate Existence. Subject to Article Four, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and the corporate, partnership or other existence of each Material Subsidiary in accordance with the respective organizational documents of each Material Subsidiary and the rights (charter and statutory) and material franchises of the Company and the Material Subsidiaries; provided that the Company shall not be required to preserve any such right or franchise, or the corporate existence of any Material Subsidiary, if the Board of Directors shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and that the loss thereof is not, and will not be, adverse in any material respect to the Holders. SECTION 3.06. Waiver of Stay, Extension or Usury Laws. The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury law or other law, which would prohibit or forgive the Company from paying all or any portion of the principal of and/or interest on the Securities as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Indenture; and (to the extent that it may lawfully do so) the Company 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. SECTION 3.07. Transactions with Affiliates. The Company shall not, and shall not permit any Subsidiary to, directly or indirectly, enter into any transaction or series of related transactions with any Affiliate (other than with the Company or a Wholly-Owned Subsidiary), including, without limitation, any loan, advance or investment or any purchase, sale, lease or exchange of property or the rendering of any service, unless such transaction or series of transactions is in good faith and at arm's length and on terms which are at least as favorable as those available in a comparable transaction from an unrelated Person. Any such transaction that involves in excess of $10,000,000 shall be approved by a majority of the Independent Directors on the Board of Directors of the Company; or, in the event that at the time of any such transaction or series of related transactions there are no Independent Directors serving on the Board of Directors of the Company, such transaction or series of related transactions shall be approved by a nationally recognized expert with experience in appraising the terms and conditions of the type of transaction for which approval is required. 26 SECTION 3.08. Change of Control. (a) In the event of any Change of Control, each Holder shall have the right, at such Holder's option, to require the Company to purchase all or any portion (in integral multiples of $1,000) of such Holder's Securities on the date (the "Change of Control Payment Date") which is 20 business days after the date the Change of Control Notice as defined below is mailed (or such later date as is required by applicable law) at 101% of the principal amount (excluding premium) thereof, plus accrued interest to the Change of Control Payment Date; provided that the Company shall not be obligated to purchase any of such Securities unless Holders of at least 10% of the Securities outstanding at the Change of Control Payment Date (other than Securities held by the Company and its Affiliates) shall have tendered their Securities for repurchase. In addition, in the event of any Change of Control, the Company will not, and will not permit any Subsidiaries to, purchase or redeem any Indebtedness ranking junior to the Securities pursuant to any analogous provisions prior to the Change of Control Payment Date. (b) The Company or, at the written request and expense of the Company, the Trustee shall send, by first-class mail, postage prepaid, to all Holders, within five business days after the occurrence of each Change of Control, a notice of the occurrence of such Change of Control (the "Change of Control Notice") specifying a date by which a Holder must notify the Company of such Holder's intention to exercise the repurchase right and describing the procedure that such Holder must follow to exercise such right. The Company is required to deliver a copy of such notice to the Trustee and to cause a copy of such notice to be published in a daily newspaper of national circulation. Each Change of Control Notice shall state: (1) the Change of Control Payment Date; (2) the date by which the repurchase right must be exercised; (3) the price at which the repurchase is to be made, if the repurchase right is exercised; and (4) a description of the procedure which the Holder must follow to exercise a repurchase right. No failure of the Company to give the foregoing notice shall limit any Holder's right to exercise a repurchase right. The Company shall comply with all applicable Federal and state securities laws in connection with each Change of Control Notice. (c) To exercise the repurchase right, the Holder shall deliver, on or before the fifth calendar day prior to the Change of Control Payment Date, written notice to the Company (or an agent designated by the Company for such purpose) of the Holder's exercise of such right, together with 27 (i) the Security or Securities with respect to which the right is being exercised, duly endorsed for transfer, with the form entitled "Option of Holder to Elect Purchase" on the reverse of the Security completed, and (ii) if the Change of Control Payment Date falls between any record date for the payment of interest on the Securities and the next succeeding interest payment date, an amount equal to the interest which the Holder is entitled to receive on such interest payment date. (d) A "Change of Control" shall be deemed to occur if (i) the Company has any other Indebtedness outstanding (other than Indebtedness under a bank credit agreement or similar bank financing) which provides for a Change of Control (as defined in the instrument governing such Indebtedness) if Ian M. Cumming or Joseph S. Steinberg ceases to beneficially own, in the aggregate, a certain percentage of the outstanding Common Shares, which percentage ownership requirement is in excess of 10%, and a Change of Control (as defined in the instrument governing such Indebtedness) occurs under such Indebtedness or (ii) at any time when the Company does not have any other Indebtedness outstanding of the type referred to in clause (i), Ian M. Cumming and/or Joseph S. Steinberg, individually or in the aggregate, sell, transfer or otherwise dispose of (a "Disposition"), after the date hereof, Common Shares so that, after giving effect thereto, the sole beneficial ownership of outstanding Common Shares by Mr. Cumming and/or Mr. Steinberg would, in the aggregate, fall below 10% of the then outstanding Common Shares; provided that no Change of Control shall be deemed to have occurred under clause (ii) if the Securities are rated by both Moody's and S&P as Investment Grade both at the time of such Disposition and for a period of 90 days from the date of such Disposition (it being understood that, with respect to the foregoing proviso, a Change of Control shall be deemed to occur on the first date during such 90-day period when the Securities are no longer rated as Investment Grade by either Moody's or S&P). The term "Common Shares" shall include any securities issued as dividends or distributions on the Common Shares. For purposes hereof, "sole beneficial ownership" of Common Shares shall be deemed to include (i) all Common Shares received after June 15, 1992 from Mr. Cumming or Mr. Steinberg by any member of their respective immediate families or by any trust for the benefit of either of them or any member of their respective immediate families (a "Recipient"), which Common Shares remain held by a Recipient during the lifetime of Mr. Cumming or Mr. Steinberg (unless sold, transferred or disposed of by such Recipient during the lifetime of Mr. Cumming or Mr. Steinberg, as the case may be, in which case such Disposition by such Recipient shall constitute a Disposition by Mr. Cumming or Mr. Steinberg, as the case may be) and (ii) after the death of Mr. Cumming and/or Mr. Steinberg, all Common Shares owned as of the date of death by the decedent, and any Recipient of the decedent, regardless of whether such Recipient continues to own such Common Shares after the date of death. In determining the number of outstanding Common Shares then held by Messrs. Cumming and Steinberg and the total number of outstanding Common Shares, there shall be excluded Common Shares issued by the Company after December 31, 1991, or the conversion into or exchange for, after December 31, 1991, Common Shares or securities convertible into or exchangeable for Common Shares. 28 SECTION 3.09. Limitation on Incurrence of Additional Indebtedness by the Company and on the Incurrence of Additional Indebtedness and Issuance of Preferred Stock by Its Subsidiaries. (a) The Company shall not, and shall not permit any Subsidiary to, create, incur, assume or guarantee the payment of any Indebtedness, and shall not permit any of its Subsidiaries to issue any Preferred Stock, if, at the time of such event and after giving effect thereto on a pro forma basis, the Company's ratio of Consolidated Debt to Consolidated Tangible Net Worth, as of the most recent date for which consolidated financial statements are available and adjusted for the incurrence of all Indebtedness and the issuance of all Preferred Stock by Subsidiaries (other than Permitted Indebtedness) since that date, would be greater than 1.75 to 1. (b) Paragraph (a) of this Section 3.09 shall not preclude the incurrence of Permitted Indebtedness. SECTION 3.10. Limitation on Liens. (a) The Company will not, nor will it permit any Material Subsidiary to, (i) issue, assume or guarantee any Indebtedness, if such Indebtedness is secured by a Lien upon, or (ii) directly or indirectly secure any outstanding Indebtedness of the Company or any Material Subsidiary by a Lien upon, any Principal Property now owned or hereafter acquired, without in any such case effectively providing, concurrently with the issuance, assumption or guarantee of any such Indebtedness, or the granting of security with respect to any such outstanding Indebtedness, that the Securities (together with, if the Company shall so determine, any other Indebtedness of or guarantee by the Company or any Material Subsidiary ranking equally with the Securities then existing or thereafter created) shall be secured equally and ratably with (or prior to) such Indebtedness; provided, however, that the foregoing restriction shall not apply to: (1) Liens on any Principal Property acquired after the date of this Indenture which are created or assumed contemporaneously with, or within 90 days after, such acquisition solely for the purpose of securing Indebtedness (including, but not limited to, deferred purchase price obligations) representing, or incurred to finance, refinance or refund, the purchase price or acquisition cost of the Principal Property subject thereto; provided that (a) the principal amount of the Indebtedness secured by such Lien does not exceed 100% of such purchase price or acquisition cost and (b) such Lien does not extend to or cover any Principal Property other than such Principal Property and any improvements thereon or rights appurtenant thereto acquired in such transaction; (2) Liens on any Principal Property acquired after the date of this Indenture existing at the time such Principal Property is acquired; 29 (3) Liens on any Principal Property or shares of stock or Indebtedness acquired from or through a corporation which is merged with or into the Company or a Material Subsidiary; (4) Liens in favor of the Company or any Subsidiary; (5) Liens on any Principal Property in existence on the date of this Indenture; (6) Liens on any Principal Property constituting unimproved real property constructed or improved by the Company or any Material Subsidiary after the date of this Indenture which are created or assumed contemporaneously with, or within 90 days after, such construction or improvement solely for the purpose of securing Indebtedness (including, but not limited to, deferred purchase price obligations) representing, or incurred to finance, refinance or refund, the cost of such construction or improvement; provided that (a) the principal amount of the Indebtedness secured by such Lien does not exceed 100% of such cost and (b) such Lien does not extend to or cover any Principal Property other than such unimproved real property and any improvements thereon or rights appurtenant thereto constructed or improved in such transaction; (7) Liens in favor of, or required by, any governmental authority; (8) pledges or deposits securing Indebtedness incurred in connection with workers' compensation, unemployment insurance and other social security legislation and deposits securing Indebtedness to insurance carriers under insurance or self-insurance arrangements or other pledges or deposits in the ordinary course of the insurance business of a Material Subsidiary of the Company that is a licensed insurance company, including, without limitation, those relating to the insurance or reinsurance operations of such Material Subsidiaries and those relating to the requirement to create "separate accounts"; (9) Liens securing Indebtedness incurred in connection with taxes not yet due or which are being contested in good faith by appropriate proceedings; provided that adequate reserves with respect thereto are maintained on the books of the Company or its Subsidiaries, as the case may be, in conformity with GAAP; (10) Liens securing any extension, renewal, substitution or replacement (or successive extensions, renewals, substitutions or replacements) of Indebtedness of the Company or any Material Subsidiary which is outstanding on March 31, 1993; provided, however, that the principal amount of Indebtedness secured thereby shall not exceed the principal amount of Indebtedness so secured at March 31, 1993; and (11) any extension, renewal, substitution or replacement (or successive extensions, renewals, substitutions or replacements), in whole or in part, of any Lien referred to in the foregoing clauses (1) through (10), inclusive; provided, however, that such extension, 30 renewal, substitution or replacement shall be limited to all or part of the Principal Property which secured the Lien so extended, renewed, substituted or replaced (plus improvements on such Principal Property). (b) Notwithstanding the provisions of subsection (a) of this Section 3.10, the Company or any Material Subsidiary may (without equally and ratably securing the Securities) issue, assume or guarantee secured Indebtedness which would otherwise be subject to the foregoing Lien restrictions in an aggregate amount which, together with all other such secured Indebtedness of the Company and its Material Subsidiaries (that is, not including secured Indebtedness of the Company and its Material Subsidiaries permitted in accordance with Section 3.10(a)) and all Attributable Debt in respect of Sale and Lease-Back Transactions existing at such time (other than Sale and Lease-Back Transactions permitted in accordance with Section 3.11(a)), does not at the time exceed 15% of total shareholders' equity in the Company and its consolidated Subsidiaries, as shown on the audited consolidated balance sheet contained in the latest annual report to shareholders of the Company. SECTION 3.11. Limitation on Sale and Lease-Back Transactions. (a) The Company will not, nor will it permit any Material Subsidiary to, enter into any Sale and Lease-Back Transaction unless the proceeds of such sale or transfer are at least equal to the fair value (as determined by the Board of Directors) of the Principal Property to be leased pursuant to such Sale and Lease-Back Transaction and either (i) the Company or such Material Subsidiary would be entitled to incur Indebtedness secured by a Lien on such Principal Property permitted by Section 3.10, (ii) such Sale and Lease-Back Transaction is entered into between or among the Company and a Subsidiary or between or among Subsidiaries, (iii) the lease in such Sale and Lease-Back Transaction is for a period, including renewal rights, of not in excess of three years, and the Company or such Material Subsidiary that is a party to such lease intends that its use of such Principal Property will be discontinued on or before the expiration of such period, or (iv) the Company covenants that it will apply, or cause such Material Subsidiary to apply, an amount equal to the fair value (as determined by the Board of Directors) of the Principal Property so leased to (1) the retirement (other than any mandatory retirement), within 60 days of the effective date of any such Sale and Lease-Back Transaction, of Funded Debt of the Company or of such Material Subsidiary or (2) the purchase of property that will constitute Principal Property. (b) Notwithstanding the provisions of the preceding paragraph (a), the Company or any Material Subsidiary may enter into any Sale and Lease-Back Transaction which would otherwise be subject to the foregoing restrictions if the amount of the Attributable Debt in respect of such Sale and Lease-Back Transaction, together with all secured Indebtedness of the Company and its Material Subsidiaries (other than secured Indebtedness of the Company and its Material Subsidiaries permitted in accordance with Section 3.10(a)) and all other Attributable Debt in respect of Sale and Lease-Back Transactions existing at such time (other than Sale and Lease-Back Transactions permitted in 31 accordance with Section 3.11(a)), does not at the time exceed 15% of total shareholders' equity in the Company and its consolidated Subsidiaries, as shown on the audited consolidated balance sheet contained in the latest annual report to shareholders of the Company. SECTION 3.12. Limitation on Funded Debt of Material Subsidiaries. (a) The Company will not permit any Material Subsidiary to (i) create, incur, assume or suffer to exist any Funded Debt other than (A) Funded Debt secured by a Lien on Principal Property which is permitted under the provisions of Section 3.10, (B) Funded Debt owed to the Company or any Subsidiary, (C) Funded Debt of a corporation which is merged with or into the Company or a Material Subsidiary, (D) Funded Debt in existence on the date of this Indenture, (E) Funded Debt created in connection with, or with a view to, compliance by a Material Subsidiary with the requirements of any program adopted by any federal, state or local governmental authority and applicable to such Material Subsidiary and providing financial or tax benefits to such Material Subsidiary which are not available directly to the Company and (F) Funded Debt that is Acquired Indebtedness; or (ii) guarantee, directly or indirectly, through any arrangement which is substantially the equivalent of a guarantee, the payment of any Funded Debt except for (A) guarantees in existence on the date of this Indenture, (B) guarantees which, on the date of this Indenture, a Material Subsidiary is obligated to give, and (C) guarantees of Funded Debt permitted under the provisions of subsection 3.12(a)(i). (b) Notwithstanding the provisions of subsection (a) of this Section 3.12, any Material Subsidiary may create, incur, assume or guarantee the payment of Funded Debt in addition to that permitted by subsection (a) of this Section 3.12, and extend, renew, substitute or replace, in whole or in part, such Funded Debt; provided that at the time of such creation, incurrence, assumption, guarantee, extension, renewal, substitution or replacement, and after giving effect thereto, the aggregate principal amount of all Funded Debt of Material Subsidiaries does not exceed 15% of Consolidated Tangible Net Worth. ARTICLE FOUR SUCCESSOR CORPORATION SECTION 4.01. When Company May Merge, etc. The Company shall not consolidate or merge with or into, or sell, lease, convey or otherwise dispose of all or substantially all of its assets (it being understood that a sale of less than 90% of the Company's total assets shall not be deemed a sale of substantially all of the Company's assets), in one transaction or a series of related transactions, to any Person unless: (1) the Person formed by or surviving any such consolidation or merger (if other than the Company), or to which such sale, lease, conveyance or other disposition shall have been made, is 32 a corporation organized and existing under the laws of the United States, any state thereof or the District of Columbia; (2) the corporation formed by or surviving any such consolidation or merger (if other than the Company), or to which such sale, lease, conveyance or other disposition shall have been made, assumes by supplemental indenture in a form satisfactory to the Trustee all the obligations of the Company under the Securities and this Indenture; (3) immediately before and immediately after such transaction no Default or Event of Default exists; and (4) the Company or any corporation formed by or surviving any such consolidation or merger, or to which such sale, lease, conveyance or other disposition shall have been made, shall immediately thereafter have a Consolidated Net Worth (after purchase accounting adjustments) at least equal to the Consolidated Net Worth of the Company immediately preceding such transaction. The Company shall deliver to the Trustee prior to the consummation of the proposed transaction an Officers' Certificate to the foregoing effect and an Opinion of Counsel stating that the proposed transaction and such supplemental indenture comply with this Indenture. SECTION 4.02. Successor Corporation Substituted. Upon any consolidation or merger, or any sale, lease, conveyance or other disposition of all or substantially all of the assets of the Company in accordance with Section 4.01, the successor corporation formed by such consolidation or into which the Company is merged or to which such sale, lease, conveyance or other disposition is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor corporation had been named as the Company herein. ARTICLE FIVE DEFAULTS AND REMEDIES SECTION 5.01. Events of Default. An "Event of Default" occurs if: (1) the Company defaults in the payment of interest on any Security when the same becomes due and payable and such default continues for a period of 30 days; 33 (2) the Company defaults in the payment of the principal (including premium, if any) of any Security when the same becomes due and payable at maturity, upon redemption or otherwise; (3) the Company fails to comply with any of its other agreements in the Securities or this Indenture and such default continues for the period and after the notice specified below; (4) (A) the Company or any Material Subsidiary defaults in the payment when due of principal of, interest on, or other amounts payable in respect of any of its respective Indebtedness (other than the Securities) in the aggregate principal or like amount of $15,000,000 or more, or (B) the Company or any Material Subsidiary fails to perform or comply with any of its other agreements in respect of any of its respective Indebtedness (other than the Securities) in the aggregate principal or like amount of $15,000,000 or more and such Indebtedness shall be or shall have been declared to be due and payable immediately and such acceleration shall not have been rescinded or annulled; (5) the Company or any Material Subsidiary pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case or proceeding, (B) consents to the entry of an order for relief against it in an involuntary case or proceeding, (C) consents to the appointment of a Custodian of it or for all or substantially all of its property, or (D) makes a general assignment for the benefit of its creditors, or (6) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief (with respect to the petition commencing such case) against the Company or any Material Subsidiary in an involuntary case or proceeding, (B) appoints a Custodian of the Company or any Material Subsidiary or for all or substantially all of its respective property, or (C) orders the liquidation of the Company or any Material Subsidiary, 34 and the order or decree remains unstayed and in effect for 60 days. The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or state law for the relief of debtors. The term "Custodian" means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law. A Default under clause (3) of this Section 5.01 is not an Event of Default until the Trustee or the Holders of at least 25% in principal amount of the Securities notify the Company and the Trustee of the Default and the Company does not cure the Default within 30 days after receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a "Notice of Default." SECTION 5.02. Acceleration. If an Event of Default (other than an Event of Default with respect to the Company specified in clause (5) or (6) of Section 5.01) occurs and is continuing, the Trustee by notice to the Company, or the Holders of at least 25% in aggregate principal amount of the Securities then outstanding by notice to the Company and the Trustee, may declare the principal (including premium, if any) of, and the accrued interest on, all of the Securities then outstanding due and payable immediately. Upon such declaration such principal (including premium, if any) and interest shall be due and immediately payable. If an Event of Default with respect to the Company specified in clause (5) or (6) of Section 5.01 occurs, all unpaid principal of, premium, if any, and accrued interest on the Securities then outstanding shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. Notwithstanding anything to the contrary in the preceding two paragraphs, the Holders of a majority in principal amount of the Securities then outstanding by notice to the Trustee may rescind an acceleration and its consequences if all existing Events of Default have been cured or waived and if the rescission would not conflict with any judgment or decree. When a Default or Event of Default is cured or waived, it ceases to exist. SECTION 5.03. Other Remedies. If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal or interest on the Securities or to enforce the performance of any provision of the Securities or this Indenture. The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Securityholder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All available remedies are cumulative. 35 SECTION 5.04. Waiver of Past Defaults. Subject to Sections 5.02, 5.07 and 8.02, the Holders of a majority in principal amount of the Securities by notice to the Trustee may waive an existing Default or Event of Default and its consequences, except a Default or Event of Default in payment of principal (including premium, if any) of, or interest on, any Security. SECTION 5.05. Control by Majority. The Holders of a majority in principal amount of the Securities may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture, that is unduly prejudicial to the rights of another Securityholder, as such, or that would involve the Trustee in personal liability. SECTION 5.06. Limitation on Remedies. Except as provided in Section 5.07, a Securityholder may not pursue any remedy with respect to this Indenture or the Securities unless: (1) the Holder gives to the Trustee written notice of a continuing Event of Default; (2) the Holders of at least 25% in principal amount of the Securities make a written request to the Trustee to pursue the remedy; (3) such Holder or Holders offer to the Trustee indemnity satisfactory to the Trustee against any loss, liability or expense; (4) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and (5) no direction inconsistent with the request has been given to the Trustee during such 60-day period by the Holders of a majority in principal amount of the Securities. A Securityholder may not use this Indenture to prejudice the rights of another Securityholder or to obtain a preference or priority over other Securityholders. SECTION 5.07. Rights of Holders To Receive Payment. Notwithstanding any other provision of this Indenture, the right of any Holder of a Security as set forth in this Indenture to receive payment of principal (including premium) of and interest on the Security, on or after the respective due dates expressed in the Security, or to bring suit for 36 the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder. Notwithstanding any other provision of this Indenture, the right of any Holder of a Security to bring suit for the enforcement of the right to convert the Security shall not be impaired or affected without the consent of the Holder. SECTION 5.08. Collection Suit by Trustee. If an Event of Default in payment of interest or principal specified in Section 5.01(1) or (2) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal and interest remaining unpaid and such further amounts as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation and expenses of the Trustee, its agents and counsel, and any other amounts due to the Trustee under Section 6.07. SECTION 5.09. Trustee May File Proofs of Claim. (a) The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee and the Securityholders allowed in any judicial proceedings relative to the Company, its creditors or its property. (b) Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Securityholder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Securityholder in any such proceeding. SECTION 5.10. Priorities. If the Trustee collects any money pursuant to this Article Five, it shall pay out the money in the following order: First: to the Trustee for amounts due under Section 6.07; Second: to Securityholders for amounts due and unpaid on the Securities for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Securities for principal and interest, respectively; and Third: to the Company. The Trustee may fix a record date and payment date for any payment to Securityholders pursuant to this Section 5.10. 37 SECTION 5.11. Undertaking for Costs. In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 5.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 5.07, or a suit by Holders of more than 10% in principal amount of the then outstanding Securities. ARTICLE SIX TRUSTEE SECTION 6.01. Duties of Trustee. (a) If an Event of Default has occurred and is continuing, the Trustee shall exercise its rights and powers and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of his own affairs. (b) Except during the continuance of an Event of Default: (1) The Trustee need perform only those duties that are specifically set forth (or incorporated by reference) in this Indenture and no others. (2) In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. However, the Trustee shall examine such certificates and opinions to determine whether or not they conform to the requirements of this Indenture. (c) The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: (1) This paragraph (c) does not limit the effect of paragraph (b) of this Section. (2) The Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts. 38 (3) The Trustee shall not be liable with respect to action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 5.05, and the Trustee shall be entitled from time to time to request such a direction. (d) Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section. (e) The Trustee shall be under no obligation and may refuse to perform any duty or exercise any right or power unless it receives indemnity satisfactory to it against any loss, liability or expense. (f) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. SECTION 6.02. Rights of Trustee. Subject to Section 6.01: (a) The Trustee may conclusively rely on any document believed by it to be genuine and to have been signed or presented by the proper person. The Trustee may rely on and shall be protected in acting or refraining from acting upon any document believed by it to be genuine and to have been signed or presented by the proper person. The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney, to the extent reasonably required by such inquiry or investigation. (b) Before the Trustee acts or refrains from acting, it may require an Officers' Certificate or an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such certificate or opinion. (c) The Trustee may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care. (d) The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers. 39 (e) The permissive rights of the Trustee to do things enumerated in this Indenture shall not be construed as a duty, and the Trustee shall not be answerable for other than its negligence or willful misconduct. (f) The Trustee shall not be charged with knowledge of any Default or Event of Default with respect to the Securities, unless either (i) a Trust Officer shall have actual knowledge of such Default or Event of Default or (ii) written notice of such Default or Event of Default shall have been given to the Trustee by the Company or by any Holder of the Securities. (g) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Holders pursuant to the provisions of this Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which may be incurred by it in compliance with such request, order or direction. (h) Except as otherwise specifically provided herein, (i) all references to the Trustee shall be deemed to refer to the Trustee in its capacity as Trustee and in its capacity as Agent, and (ii) every provision of this Indenture relating to the conduct or affecting the liability or offering protection, immunity or indemnity to the Trustee shall be deemed to apply with the same force and effect to the Trustee acting in its capacity as Agent. SECTION 6.03. Individual Rights of Trustee. The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or its Subsidiaries or Affiliates with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. However, the Trustee must comply with Sections 6.10 and 6.11. SECTION 6.04. Trustee's Disclaimer. The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities, it shall not be accountable for the Company's use of the proceeds from the Securities, and it shall not be responsible for any statement in the Securities other than its certificate of authentication. SECTION 6.05. Notice of Defaults. If a Default occurs and is continuing and if it is known to the Trustee, the Trustee shall mail to each Securityholder pursuant to Section 9.02 a notice of the Default within 90 days after it occurs. Except in the case of a Default in any payment on any Security, the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interests of Securityholders. 40 SECTION 6.06. Reports by Trustee to Holders. Within 60 days after each May 15, beginning with May 15, 2004, the Trustee shall mail to each Securityholder a brief report dated as of such May 15 that complies with TIA ss. 313(a), but only if such report is required in any year under TIA ss. 313(a). The Trustee also shall comply with TIA ss.ss. 313(b) and 313(c). A copy of each report at the time of its mailing to Securityholders shall be filed with the SEC and each stock exchange on which the Securities are listed. The Company shall notify the Trustee in writing if the Securities become listed on any national securities exchange or of any delisting thereof. SECTION 6.07. Compensation and Indemnity. The Company shall pay the Trustee from time to time reasonable compensation for its services (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust). The Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses, disbursements and advances incurred by it. Such expenses may include the reasonable compensation and expenses of the Trustee's agents and counsel. The Trustee shall not be under any obligation to institute any suit, or take any remedial action under this Indenture, or to enter any appearance or in any way defend any suit in which it may be a defendant, or to take any steps in the execution of the trusts created hereby or thereby or in the enforcement of any rights and powers under this Indenture, until it shall be indemnified to its satisfaction against any and all reasonable expenses, disbursements and advances incurred or made by the Trustee in accordance with any provision of this Indenture, including compensation for services, costs, expenses, outlays, counsel fees and other disbursements, and against all liability not due to its negligence or willful misconduct. The Company shall indemnify the Trustee against any loss or liability incurred by it in connection with the acceptance and administration of the trust and its duties hereunder as Trustee, Registrar and/or Paying Agent, including the costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity; however, unless the position of the Company is prejudiced by such failure, the failure of the Trustee to promptly notify the Company shall not limit its right to indemnification. The Company shall defend each such claim and the Trustee shall cooperate in the defense. The Trustee may retain separate counsel and the Company shall reimburse the Trustee for the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent. The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Trustee through negligence or willful misconduct. 41 To secure the Company's payment obligations in this Section, the Trustee shall have a lien prior to that of the Holders of the Securities on all money or property held or collected by the Trustee, except that held in trust to pay principal and interest on particular Securities. When the Trustee incurs expenses or renders services after the occurrence of any Event of Default specified in Section 5.01(5) or (6), the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law. The obligations of the Company under this Section 6.07 shall survive the registration or removal of the Trustee and the termination, satisfaction or discharge of this Indenture. SECTION 6.08. Replacement of Trustee. The Trustee may resign by so notifying the Company. The Holders of a majority in principal amount of the Securities may remove the Trustee by so notifying the Trustee in writing. The Company may remove the Trustee if: (1) the Trustee fails to comply with Section 6.10; (2) the Trustee is adjudged a bankrupt or an insolvent; (3) a receiver or other public officer takes charge of the Trustee or its property; or (4) the Trustee becomes incapable of acting as Trustee hereunder. If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the Securities may appoint a successor Trustee to replace the successor Trustee appointed by the Company. A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Immediately after that, the retiring Trustee shall transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 6.07, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. A successor Trustee shall mail notice of its succession to each Securityholder. If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of a majority in principal amount of the Securities may petition any court of competent jurisdiction for the appointment of a successor Trustee. 42 If the Trustee fails to comply with Section 6.10, any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. Any successor Trustee shall comply with TIA ss. 310(a)(5). SECTION 6.09. Successor Trustee by Merger, etc. If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust assets to, another corporation, the successor corporation without any further act shall be the successor Trustee; provided such corporation or association shall be otherwise eligible and qualified under this Article Six. SECTION 6.10. Eligibility; Disqualification. This Indenture shall always have a Trustee who satisfies the requirements of TIAss. 310(a)(1). The Trustee shall always have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition. The Trustee shall also comply with TIA ss. 310(b). SECTION 6.11. Preferential Collection of Claims Against Company. The Trustee shall comply with TIAss. 311(a), excluding any creditor relationship listed in TIAss. 311(b). A Trustee who has resigned or been removed shall be subject to TIA ss. 311(a) to the extent indicated therein. ARTICLE SEVEN DISCHARGE OF INDENTURE SECTION 7.01. Termination of Company's Obligations. The Company may terminate all of its obligations under the Securities and this Indenture if: (a) all Securities previously authenticated and delivered (other than destroyed, lost or stolen Securities which have been replaced or paid) have been delivered to the Trustee for cancellation and the Company has paid all sums payable by it hereunder; or (b) (1) the Securities mature within one year or all of them are to be called for redemption within one year under arrangements satisfactory to the Trustee for giving the notice of redemption, and (2) the Company irrevocably deposits in trust with the Trustee immediately available funds or U.S. Government Obligations sufficient to pay principal and interest on the Securities to maturity or redemption, as the case may be. 43 However, the Company's obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 3.01, 3.04, 6.07 and 6.08 shall survive until the Securities are no longer outstanding. Thereafter the Company's obligations in Section 6.07 shall survive. Upon receipt, in the case of clause (a) or (b) above in this Section 7.01, by the Trustee of an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with, the Trustee upon request shall acknowledge in writing the discharge of the Company's obligations under the Securities and this Indenture except for those surviving obligations specified above. In order to have money available on a payment date to pay principal or interest on the Securities, the U.S. Government Obligations shall be payable as to principal or interest on or before such payment date in such amounts as will provide the necessary money. U.S. Government Obligations shall not be callable at the issuer's option. The term "U.S. Government Obligations" means direct obligations of the United States for the payment of which the full faith and credit of the United States is pledged. SECTION 7.02. Application of Trust Money. The Trustee shall hold in trust money or U.S. Government Obligations deposited with it pursuant to Section 7.01. It shall apply the deposited money and the money from U.S. Government Obligations through the Paying Agent and in accordance with this Indenture to the payment of principal and interest on the Securities. SECTION 7.03. Repayment to Company. The Trustee and the Paying Agent shall promptly pay to the Company upon request any excess money or securities held by them at any time. The Trustee and the Paying Agent shall pay to the Company upon request any money held by them for the payment of principal or interest that remains unclaimed for two years; provided, however, that the Trustee or such Paying Agent before being required to make any such repayment may at the expense of the Company cause to be published once in a newspaper of general circulation in The City of New York or mail to each such Holder notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication or mailing, any unclaimed balance of such money then remaining will be paid to the Company. SECTION 7.04. Reinstatement. If the Trustee or Paying Agent is unable to apply any money or U.S. Government Obligations in accordance with Section 7.01 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such 44 application, the Company's obligations under this Indenture and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to Section 7.01 until such time as the Trustee or Paying Agent is permitted to apply all such money or U.S. Government Obligations in accordance with Section 7.01; provided, however, that if the Company has made any payment of interest on or principal of any Securities because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money or U.S. Government Obligations held by the Trustee or Paying Agent. ARTICLE EIGHT AMENDMENTS, SUPPLEMENTS AND WAIVERS SECTION 8.01. Without Consent of Holders. Subject to Section 5.07, the Company, when authorized by a resolution of its Board of Directors, may amend or supplement this Indenture or the Securities without notice to or consent of any Securityholder: (1) to cure any ambiguity, defect or inconsistency; (2) to comply with Section 4.01; (3) to provide for uncertificated Securities in addition to certificated Securities; (4) to comply with any requirements of the SEC in order to effect or maintain the qualification of this Indenture under the TIA; or (5) to make any change that would provide any additional benefit or rights to the Securityholders or that does not adversely affect the rights of any Securityholder. Notwithstanding the above, the Trustee and the Company may not make any change that adversely affects the legal rights of any Securityholders hereunder. SECTION 8.02. With Consent of Holders. Subject to Section 5.07, the Company, when authorized by a resolution of its Board of Directors, may amend or supplement this Indenture or the Securities with the written consent of the Holders of at least a majority in principal amount of the Securities then outstanding, and the Holders of a majority in principal amount of the Securities may waive compliance by the Company with any provision of this Indenture or the Securities. However, without 45 the consent of each Securityholder affected, an amendment, supplement or waiver, including a waiver pursuant to Section 5.04, may not: (1) reduce the amount of Securities whose Holders must consent to an amendment, supplement or waiver; (2) reduce the rate of or change or extend the time for payment of principal of (including premium, if any) or interest on any Security; (3) reduce the principal of (including premium, if any) or change the fixed maturity of any Security; (4) waive a default in the payment of the principal of or interest on any Security; (5) make any Security payable in money other than that stated in the Security; or (6) make any change in this Section, Section 5.04 or Section 5.07. Notwithstanding the above and Section 5.07, the Holders of a majority in principal amount of the Securities then outstanding may waive compliance by the Company with Section 3.08 of this Indenture. It shall not be necessary for the consent of the Holders under this Section 8.02 to approve the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof. Any amendment, waiver or consent shall be deemed effective upon receipt by the Trustee of the necessary consents and shall not require execution of any supplemental indenture to be effective. After an amendment or waiver under this Section 8.02 becomes effective, the Company shall mail to the Holders of each Security affected thereby, with a copy to the Trustee, a notice briefly describing the amendment or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amendment, waiver, consent or supplemental indenture. Except as otherwise provided in this Section 8.02, the Holders of a majority in aggregate principal amount of the Securities then outstanding may waive compliance in a particular instance by the Company with any provisions of this Indenture or the Securities. SECTION 8.03. Compliance with Trust Indenture Act. Every amendment to or supplement of this Indenture or the Securities shall comply with the TIA as then in effect. 46 SECTION 8.04. Revocation and Effect of Consents. A consent to an amendment, supplement or waiver by a Holder of a Security shall bind the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder's Security, even if notation of the consent is not made on any Security. However, until an amendment or waiver becomes effective, any such Holder or subsequent Holder may revoke the consent as to his Security or portion of a Security. For such revocation to be effective, the Trustee must receive the notice of revocation before the date the amendment, supplement or waiver becomes effective. After an amendment, supplement or waiver becomes effective, it shall bind every Securityholder unless it makes a change described in any of clauses (1) through (6) of Section 8.02. In that case the amendment, supplement or waiver shall bind each Holder of a Security who has consented to it and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder's Security. SECTION 8.05. Notation on or Exchange of Securities. If an amendment, supplement or waiver changes the terms of a Security, the Trustee may require the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Security about the changed terms and return it to the Holder. Alternatively, if the Company or the Trustee so determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms. SECTION 8.06. Trustee Protected. The Trustee shall sign any amendment or supplement or waiver authorized pursuant to this Article Eight if the amendment or supplement or waiver does not adversely affect the rights of the Trustee. If it does adversely affect the rights of the Trustee, the Trustee may but need not sign it. In signing such amendment or supplement or waiver the Trustee shall be entitled to receive, and (subject to Article Six) shall be fully protected in relying upon, in addition to the documents required by Section 9.04, an Opinion of Counsel stating that such amendment or supplement or waiver is authorized or permitted by and complies with this Indenture. The Company may not sign an amendment or supplement until the Board of Directors approves it. 47 ARTICLE NINE MISCELLANEOUS SECTION 9.01. Trust Indenture Act Controls. If any provision of this Indenture limits, qualifies, or conflicts with another provision which is required to be included in this Indenture by the TIA, the required provision shall control. SECTION 9.02. Notices. Any notice or communication shall be sufficiently given if in writing and delivered in person, by facsimile or mailed by certified or registered mail (return receipt requested) addressed as follows: If to the Company: Leucadia National Corporation 315 Park Avenue South New York, New York 10010 Facsimile: (212) 598-4869 Attention: Secretary With a copy to: Weil Gotshal & Manges 767 Fifth Avenue New York, New York 10153 Facsimile: (212) 310-8007 Attention: Andrea A. Bernstein, Esq. If to the Trustee: JPMorgan Chase Bank 4 New York Plaza, 15th Floor New York, New York 10004 Facsimile: (212) 623-6167 Attention: Institutional Trust Services 48 The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications. Any notice or communication mailed to a Securityholder shall be mailed to him by first-class mail at his address as it appears on the registration books of the Registrar and shall be sufficiently given to him if so mailed within the time prescribed. Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with respect to other Securityholders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it. If the Company mails notices or communications to Securityholders, it shall mail a copy to the Trustee and each Agent at the same time. All notices or communications shall be in writing. SECTION 9.03. Communication by Holders with Other Holders. Securityholders may communicate pursuant to TIA ss. 312(b) with other Securityholders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA ss. 312(c). SECTION 9.04. Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee: (1) an Officers' Certificate stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and (2) an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent have been complied with. SECTION 9.05. Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: (1) a statement that each person making such certificate or opinion has read such covenant or condition; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; 49 (3) a statement that, in the opinion of each such person, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement as to whether or not, in the opinion of each such person, such covenant or condition has been complied with. SECTION 9.06. When Treasury Securities Disregarded. In determining whether the Holders of the required principal amount of Securities have concurred in any direction, waiver or consent, Securities owned by the Company or by any Affiliate shall be disregarded, except that for the purpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Securities which a Responsible Officer of the Trustee knows are so owned shall be so disregarded. SECTION 9.07. Rules by Trustee and Agents. The Trustee may make reasonable rules for action by or a meeting of Securityholders. The Registrar or Paying Agent may make reasonable rules for its functions. SECTION 9.08. Legal Holidays. A "Legal Holiday" is a Saturday, a Sunday, or a day on which banks and trust companies in The City of New York or Chicago are not required by law or executive order to be open. If a payment date is a Legal Holiday at a place of payment, payment may be made at the place on the next succeeding day that is not a Legal Holiday, without additional interest. SECTION 9.09. Governing Law. The laws of the State of New York shall govern this Indenture and the Securities without regard to principles of conflicts of laws. SECTION 9.10. No Adverse Interpretation of Other Agreements. This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary. Any such indenture, loan or debt agreement may not be used to interpret this Indenture. SECTION 9.11. No Recourse Against Others. All liability described in paragraph 14 of the Securities of any director, officer, employee or stockholder, as such, of the Company is waived and released. 50 SECTION 9.12. Successors. All agreements of the Company in this Indenture and the Securities shall bind its successor. All agreements of the Trustee in this Indenture shall bind its successor. SECTION 9.13. Duplicate Originals. The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same instrument. SECTION 9.14. Separability. In case any provision in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby, and a Holder shall have no claim therefor against any party hereto. 51 SIGNATURES IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, all as of the date first written above. LEUCADIA NATIONAL CORPORATION By: /s/ Joseph A. Orlando ------------------------------------------------ Name: Joseph A. Orlando Title: Vice President and Chief Financial Officer JPMORGAN CHASE BANK, as Trustee By: /s/ N. Moran ------------------------------------------------ Name: Natalia Moran Title: Vice President S-1 EXHIBIT A-1 [Form of Restricted Security] [Insert Global Security Legend, if applicable] [Insert Regulation S Temporary Global Security Legend, if applicable] [Insert Private Placement Legend] 7% SENIOR NOTE DUE AUGUST 15, 2013 No. $ CUSIP: LEUCADIA NATIONAL CORPORATION (a New York corporation) promises to pay to ________________________ or registered assigns the principal sum of ____________________ Dollars on August 15, 2013. Interest Payment Dates: February 15 and August 15 Record Dates: February 1 and August 1 Dated: LEUCADIA NATIONAL CORPORATION -------------------------------------- Chief Financial Officer Attest: - ------------------------------- Secretary A-1-1 Certificate of Authentication - ----------------------------- This is one of the Securities referred to in the within-mentioned Indenture. JPMORGAN CHASE BANK, as Trustee By: --------------------------------------------- Authorized Officer A-1-2 LEUCADIA NATIONAL CORPORATION 7% Senior Note Due August 15, 2013 1. Interest. Leucadia National Corporation (the "Company") promises to pay interest on the principal amount of this Security at the rate per annum shown above. The Company will pay interest semiannually on February 15 and August 15 of each year. Interest on the Securities will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from June 5, 2003. Interest will be computed on the basis of a 360-day year of twelve 30-day months. 2. Method of Payment. The Company will pay interest on the Securities (except defaulted interest) to the Persons who are registered holders of Securities at the close of business on the February 1 or August 1 next preceding the interest payment date even though Securities are cancelled after the record date and on or before the interest payment date. Holders must surrender Securities to a Paying Agent to collect principal payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. However, the Company may pay interest by check payable in such money. It may mail an interest check to a Holder's registered address. 3. Paying Agent and Registrar. Initially, JPMorgan Chase Bank will act as Paying Agent and Registrar. The Company may change any Paying Agent, Registrar or co-registrar without prior notice. The Company or any of its Subsidiaries (as defined in the Indenture) may act in any such capacity. 4. Indenture. The Company issued the Securities under an Indenture dated as of June 5, 2003 (the "Indenture") between the Company and the Trustee. The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S. Code ss.ss. 77aaa-77bbbb) as in effect on the date of the Indenture. The Securities are subject to all such terms and Securityholders are referred to the Indenture and the TIA for a statement of such terms. The Securities are general unsecured obligations of the Company limited to $200,000,000 aggregate principal amount, except as otherwise provided in the Indenture. A-1-3 5. Change of Control. In the event of a Change of Control of the Company, each Holder shall have the right, at such Holder's option, to require the Company to buy all or any portion of such Holder's Securities, at 101% of the principal amount thereof, plus accrued interest to the date of purchase. 6. Restrictive Covenants. The Indenture imposes certain limitations on, among other things, the ability of the Company to merge or consolidate with any other Person or sell, lease or otherwise transfer all or substantially all of its properties or assets, the ability of the Company and the Subsidiaries to incur additional Indebtedness and to enter into certain transactions with Affiliates, the ability of the Company and its Material Subsidiaries to create certain liens and enter into certain sale-leaseback transactions, and the ability of the Material Subsidiaries of the Company to incur certain Indebtedness, in each case subject to certain limitations described in the Indenture. 7. Denominations, Transfer, Exchange. The Securities are in registered form without coupons in denominations of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange Securities in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The Registrar need not register any transfer or exchange of Securities selected for redemption. Also, it need not register any transfer or exchange of Securities for a period of 30 days before a selection of Securities is to be redeemed. 8. Persons Deemed Owners. The registered Holder of a Security may be treated as the owner of it for all purposes and neither the Company, the Trustee nor any Agent shall be affected by notice to the contrary. 9. Unclaimed Money. If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent will pay the money back to the Company at its request. After that, Securityholders entitled to the money must look to the Company for payment unless an abandoned property law designates another person. 10. Amendment, Supplement, Waiver. Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the Securities, and any past default or noncompliance with any provision may be waived with the consent of the Holders of a majority in principal amount of the Securities. Without the consent of any A-1-4 Securityholder, the Company may amend or supplement the Indenture or the Securities to cure any ambiguity, defect or inconsistency or to provide for uncertificated Securities in addition to certificated Securities or to make any change that does not adversely affect the rights of any Securityholder. 11. Successor Corporation. When a successor corporation assumes all the obligations of its predecessor under the Securities and the Indenture, the predecessor corporation will be released from those obligations. 12. Defaults and Remedies. The terms of the Securities include the Events of Default as set forth in Section 5.01 of the Indenture. Subject to certain limitations in the Indenture, if an Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Securities may declare all the Securities to be due and payable immediately, except that in the case of an Event of Default arising from certain events of bankruptcy, insolvency or reorganization relating to the Company, all outstanding Securities shall become due and payable immediately without further action or notice. Holders may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may require indemnity satisfactory to it before it enforces the Indenture or the Securities. Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Securities may direct the Trustee in its exercise of any trust or power. The Company must furnish annual compliance certificates to the Trustee. 13. Trustee Dealings with Company. JPMorgan Chase Bank, the Trustee under the Indenture, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not the Trustee. 14. No Recourse Against Others. A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. Each Securityholder by accepting a Security waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Securities. 15. Authentication. This Security shall not be valid until the Trustee or an authenticating agent signs the certificate of authentication on the other side of this Security. A-1-5 16. Abbreviations. Customary abbreviations may be used in the name of a Securityholder or an assignee, such as: TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with right of survivorship and not as tenants in common), CUST (=Custodian), and U/G/M/A (=Uniform Gifts to Minors Act). 17. Registration Rights. In addition to the rights provided to Holders of Securities under the Indenture, Holders of Restricted Securities shall have all the rights set forth in the Registration Rights Agreement dated as of June 5, 2005 between the Company and the Initial Purchaser. The Company will furnish to any Securityholder upon written request and without charge a copy of the Indenture and/or the Registration Rights Agreement. Requests may be made to: Secretary, Leucadia National Corporation, 315 Park Avenue South, New York, New York 10010. A-1-6 ASSIGNMENT FORM To assign this Security, fill in the form below: I or we assign and transfer this Security to -------------------------------- -------------------------------- (Insert assignee's soc. sec. or tax ID no.) - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- (Print or type assignee's name, address and zip code) and irrevocably appoint ______________________________________________________ agent to transfer this Security on the books of the Company. The agent may substitute another to act for him. - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- Your Signature: __________________________________________________________ (Sign exactly as your name appears on the other side of this Security) Date: ____________________ A-1-7 OPTION OF HOLDER TO ELECT PURCHASE If you want to elect to have this Security purchased by the Company pursuant to Section 3.08 of the Indenture, check the box: Section 3.08 [ ] If you want to have only part of this Security purchased by the Company pursuant to Section 3.08 of the Indenture, state the amount (in integral multiples of $1,000): $ Date: Signature: ---------------------- --------------------------------- (Sign exactly as your name appears on the other side of this Security) Signature Guarantee: ---------------------------------------------------------- A-1-8 EXHIBIT A-2 [Form of Unrestricted Security] [Insert Global Security Legend, if applicable] 7% SENIOR NOTE DUE AUGUST 15, 2013 No. $ CUSIP: LEUCADIA NATIONAL CORPORATION (a New York corporation) promises to pay to ________________________ or registered assigns the principal sum of ____________________ Dollars on August 15, 2013. Interest Payment Dates: February 15 and August 15 Record Dates: February 1 and August 1 Dated: LEUCADIA NATIONAL CORPORATION -------------------------------------- Chief Financial Officer Attest: - ------------------------------- Secretary A-2-1 Certificate of Authentication - ----------------------------- This is one of the Securities referred to in the within-mentioned Indenture. JPMORGAN CHASE BANK, as Trustee By: ---------------------------------- Authorized Officer A-2-2 LEUCADIA NATIONAL CORPORATION 7% Senior Note Due August 15, 2013 1. Interest. Leucadia National Corporation (the "Company") promises to pay interest on the principal amount of this Security at the rate per annum shown above. The Company will pay interest semiannually on February 15 and August 15 of each year. Interest on the Securities will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from June 5, 2003. Interest will be computed on the basis of a 360-day year of twelve 30-day months. 2. Method of Payment. The Company will pay interest on the Securities (except defaulted interest) to the Persons who are registered holders of Securities at the close of business on the February 1 or August 1 next preceding the interest payment date even though Securities are cancelled after the record date and on or before the interest payment date. Holders must surrender Securities to a Paying Agent to collect principal payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. However, the Company may pay interest by check payable in such money. It may mail an interest check to a Holder's registered address. 3. Paying Agent and Registrar. JPMorgan Chase Bank will act as Paying Agent and Registrar. The Company may change any Paying Agent, Registrar or co-registrar without prior notice. The Company or any of its Subsidiaries (as defined in the Indenture) may act in any such capacity. 4. Indenture. The Company issued the Securities under an Indenture dated as of June 5, 2003 (the "Indenture") between the Company and the Trustee. The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S. Code ss.ss. 77aaa-77bbbb) as in effect on the date of the Indenture. The Securities are subject to all such terms and Securityholders are referred to the Indenture and the TIA for a statement of such terms. The Securities are general unsecured obligations of the Company limited to $200,000,000 aggregate principal amount, except as otherwise provided in the Indenture. A-2-3 5. Change of Control. In the event of a Change of Control of the Company, each Holder shall have the right, at such Holder's option, to require the Company to buy all or any portion of such Holder's Securities, at 101% of the principal amount thereof, plus accrued interest to the date of purchase. 6. Restrictive Covenants. The Indenture imposes certain limitations on, among other things, the ability of the Company to merge or consolidate with any other Person or sell, lease or otherwise transfer all or substantially all of its properties or assets, the ability of the Company and the Subsidiaries to incur additional Indebtedness and to enter into certain transactions with Affiliates, the ability of the Company and its Material Subsidiaries to create certain liens and enter into certain sale-leaseback transactions, and the ability of the Material Subsidiaries of the Company to incur certain Indebtedness, in each case subject to certain limitations described in the Indenture. 7. Denominations, Transfer, Exchange. The Securities are in registered form without coupons in denominations of $1,000 and whole multiples of $1,000. A Holder may transfer or exchange Securities in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The Registrar need not register any transfer or exchange of Securities selected for redemption. Also, it need not register any transfer or exchange of Securities for a period of 30 days before a selection of Securities is to be redeemed. 8. Persons Deemed Owners. The registered Holder of a Security may be treated as the owner of it for all purposes and neither the Company, the Trustee nor any Agent shall be affected by notice to the contrary. 9. Unclaimed Money. If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent will pay the money back to the Company at its request. After that, Securityholders entitled to the money must look to the Company for payment unless an abandoned property law designates another person. 10. Amendment, Supplement, Waiver. Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented with the consent of the Holders of at least a majority in principal amount of the Securities, and any past default or noncompliance with any provision may be waived with the consent of the Holders of a majority in principal amount of the Securities. Without the consent of any Securityholder, the Company may amend or supplement the Indenture or the A-2-4 Securities to cure any ambiguity, defect or inconsistency or to provide for uncertificated Securities in addition to certificated Securities or to make any change that does not adversely affect the rights of any Securityholder. 11. Successor Corporation. When a successor corporation assumes all the obligations of its predecessor under the Securities and the Indenture, the predecessor corporation will be released from those obligations. 12. Defaults and Remedies. The terms of the Securities include the Events of Default as set forth in Section 5.01 of the Indenture. Subject to certain limitations in the Indenture, if an Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Securities may declare all the Securities to be due and payable immediately, except that in the case of an Event of Default arising from certain events of bankruptcy, insolvency or reorganization relating to the Company, all outstanding Securities shall become due and payable immediately without further action or notice. Holders may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may require indemnity satisfactory to it before it enforces the Indenture or the Securities. Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Securities may direct the Trustee in its exercise of any trust or power. The Company must furnish annual compliance certificates to the Trustee. 13. Trustee Dealings with Company. JPMorgan Chase Bank, the Trustee under the Indenture, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not the Trustee. 14. No Recourse Against Others. A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. Each Securityholder by accepting a Security waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Securities. 15. Authentication. This Security shall not be valid until the Trustee or an authenticating agent signs the certificate of authentication on the other side of this Security. A-2-5 16. Abbreviations. Customary abbreviations may be used in the name of a Securityholder or an assignee, such as: TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with right of survivorship and not as tenants in common), CUST (=Custodian), and U/G/M/A (=Uniform Gifts to Minors Act). The Company will furnish to any Securityholder upon written request and without charge a copy of the Indenture. Requests may be made to: Secretary, Leucadia National Corporation, 315 Park Avenue South, New York, New York 10010. A-2-6 ASSIGNMENT FORM To assign this Security, fill in the form below: I or we assign and transfer this Security to -------------------------------- -------------------------------- (Insert assignee's soc. sec. or tax ID no.) - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- (Print or type assignee's name, address and zip code) and irrevocably appoint ______________________________________________________ agent to transfer this Security on the books of the Company. The agent may substitute another to act for him. - ----------------------------------------------------------------------------- - ----------------------------------------------------------------------------- Your Signature: ___________________________________________________________ (Sign exactly as your name appears on the other side of this Security) Date: ____________________ A-2-7 OPTION OF HOLDER TO ELECT PURCHASE If you want to elect to have this Security purchased by the Company pursuant to Section 3.08 of the Indenture, check the box: Section 3.08 [ ] If you want to have only part of this Security purchased by the Company pursuant to Section 3.08 of the Indenture, state the amount (in integral multiples of $1,000): $ Date: Signature: -------------------- ------------------------------------ (Sign exactly as your name appears on the other side of this Security) Signature Guarantee: ---------------------------------------------------------- A-2-8 EXHIBIT B [Form of Private Placement Legend] Any Restricted Security authenticated and delivered hereunder shall bear a legend (which would be in addition to any other legends required) in substantially the following form: THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS (OR SUCH OTHER PERIOD THAT MAY HEREAFTER BE PROVIDED UNDER RULE 144(k) UNDER THE SECURITIES ACT AS PERMITTING RESALES OF RESTRICTED SECURITIES BY NON-AFFILIATES WITHOUT RESTRICTION) AFTER THE LATER OF THE ORIGINAL ISSUE DATE OF THIS SECURITY AND THE LAST DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) (THE "RESALE RESTRICTION TERMINATION DATE") ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A UNDER THE SECURITIES ACT, (D) OUTSIDE OF THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH (a) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY B-1 SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING IN THE INDENTURE GOVERNING THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE AND IN EACH CASE IN ACCORDANCE WITH APPLICABLE SECURITIES LAWS OF ANY U.S. STATE OR ANY OTHER APPLICABLE JURISDICTION. B-2 EXHIBIT C [Form of Global Security Legend] Any Global Security authenticated and delivered hereunder shall bear a legend (which would be in addition to any other legends required) in substantially the following form: THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. C-1 EXHIBIT D [Form of Regulation S Temporary Global Security Legend] Any Regulation S Temporary Global Security authenticated and delivered hereunder shall bear a legend (which would be in addition to any other legends required) in substantially the following form: THIS SECURITY IS A REGULATION S TEMPORARY GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE. TRANSFERS OF BENEFICIAL INTERESTS IN THIS REGULATION S TEMPORARY GLOBAL SECURITY MAY NOT BE MADE TO A U.S. PERSON OR FOR THE ACCOUNT OR BENEFIT OF A U.S. PERSON (OTHER THAN THE INITIAL PURCHASER). THE CONDITIONS AND PROCEDURES GOVERNING TRANSFERS AND EXCHANGES OF BENEIFICIAL INTERESTS HEREIN ARE SET FORTH IN THE INDENTURE. D-1 EXHIBIT E [Form of Certificate of Transfer] Leucadia National Corporation 315 Park Avenue South New York, New York 10010 [Registrar address block] Re: 7% Senior Notes due 2013 (CUSIP _____________) Reference is hereby made to the Indenture, dated as of June 5, 2003 (the "Indenture"), between Leucadia National Corporation , as issuer (the "Company"), and JPMorgan Chase Bank, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. ______________ (the "Transferor") owns and proposes to transfer the Security[ies] or interest in such Security[ies] specified in Annex A hereto, in the principal amount of ___________ in such Security[ies] or interests (the "Transfer"), to __________ (the "Transferee"), as further specified in Annex A hereto. In connection with the Transfer, the Transferor hereby certifies that: [CHECK ALL THAT APPLY] 1. |_| CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN A RULE 144A GLOBAL SECURITY OR A PHYSICAL SECURITY PURSUANT TO RULE 144A. The Transfer is being effected pursuant to and in accordance with Rule 144A under the United States Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, the Transferor hereby further certifies that the beneficial interest or Physical Security is being transferred to a Person that the Transferor reasonably believed and believes is purchasing the beneficial interest or Physical Security for its own account, or for one or more accounts with respect to which such Person exercises sole investment discretion, and such Person and each such account is a "qualified institutional buyer" within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Transfer is in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Physical Security will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Rule 144A Global Security and/or the Physical Security and in the Indenture and the Securities Act. 2. |_| CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN A REGULATION S GLOBAL SECURITY OR A PHYSICAL SECURITY PURSUANT TO REGULATION S. The Transfer is being effected pursuant to and in accordance with Rule 903 or E-1 Rule 904 under the Securities Act and, accordingly, the Transferor hereby further certifies that (i) the Transfer is not being made to a person in the United States and (x) at the time the buy order was originated, the Transferee was outside the United States or such Transferor and any Person acting on its behalf reasonably believed and believes that the Transferee was outside the United States or (y) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither such Transferor nor any Person acting on its behalf knows that the transaction was prearranged with a buyer in the United States, (ii) no directed selling efforts have been made in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S under the Securities Act, (iii) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act and (iv) if the proposed transfer is being made prior to the expiration of the Restricted Period, the transfer is not being made to a U.S. Person or for the account or benefit of a U.S. Person (other than the Initial Purchaser). Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Physical Security will be subject to the restrictions on Transfer enumerated in the Private Placement Legend printed on the Regulation S Global Security and/or the Physical Security and in the Indenture and the Securities Act. 3. |_| CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE GLOBAL SECURITY OR A PHYSICAL SECURITY PURSUANT TO ANY PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The Transfer is being effected in compliance with the transfer restrictions applicable to beneficial interests in Restricted Global Securities and Restricted Physical Securities and pursuant to and in accordance with the Securities Act and any applicable blue sky securities laws of any state of the United States, and accordingly the Transferor hereby further certifies that (check one): (a) |_| such Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act; or (b) |_| such Transfer is being effected to the Company or a Subsidiary thereof; or (c) |_| such Transfer is being effected pursuant to an effective registration statement under the Securities Act and in compliance with the prospectus delivery requirements of the Securities Act; or (d) |_| such Transfer is being effected to an Accredited Investor and pursuant to an exemption from the registration requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the Transferor hereby further certifies that it has not engaged in any general solicitation within the meaning of Regulation D under the Securities Act and the Transfer complies with the E-2 transfer restrictions applicable to beneficial interests in a Restricted Global Security or Restricted Physical Securities and the requirements of the exemption claimed, which certification is supported by (1) a certificate executed by the Transferee in the form of Exhibit G to the Indenture and (2) if such Transfer is in respect of a principal amount of Securities at the time of transfer of less than $250,000, an Opinion of Counsel provided by the Transferor or the Transferee (a copy of which the Transferor has attached to this certification), to the effect that such Transfer is in compliance with the Securities Act. Upon consummation of the proposed transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Physical Security will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Global Security and/or the Physical Securities and in the Indenture and the Securities Act. 4. |_| CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL SECURITY OR AN UNRESTRICTED PHYSICAL SECURITY. (a) |_| CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is being effected pursuant to and in accordance with Rule 144 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Physical Security will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Securities, on Restricted Physical Securities and in the Indenture. (b) |_| CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer is being effected pursuant to and in accordance with Rule 903 or Rule 904 under the Securities Act and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any state of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Physical Security will no longer be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Securities, on Restricted Physical Securities and in the Indenture. (c) |_| CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The Transfer is being effected pursuant to and in compliance with an exemption from the registration requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904 and in compliance with the transfer restrictions contained in the Indenture and any applicable blue sky securities laws of any State of the United States and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Physical Security will not be subject to the restrictions E-3 on transfer enumerated in the Private Placement Legend printed on the Restricted Global Securities or Restricted Physical Securities and in the Indenture. (d) |_| CHECK IF TRANSFER IS PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT. (i) The Transfer is being effected pursuant to and in compliance with an effective registration statement under the Securities Act and any applicable blue sky securities laws of any State of the United States and in compliance with the prospectus delivery requirements of the Securities Act and (ii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act. Upon consummation of the proposed Transfer in accordance with the terms of the Indenture, the transferred beneficial interest or Physical Security will not be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the Restricted Global Securities or Restricted Physical Securities and in the Indenture. This certificate and the statements contained herein are made for your benefit and the benefit of the Company. --------------------------------------- [Insert Name of Transferor] By: ------------------------------------ Name: Title: Dated: ------------------------------------ E-4 ANNEX A TO CERTIFICATE OF TRANSFER 1. The Transferor owns and proposes to transfer the following: [CHECK ONE] (a) |_| a beneficial interest in a: (i) |_| Rule 144A Global Security (CUSIP ______), or (ii) |_| Rule 501 Global Security (CUSIP _______); or (iii) |_| Regulation S Global Security (CUSIP ______), or (b) |_| a Restricted Physical Security. 2. After the Transfer the Transferee will hold: [CHECK ONE] (a) |_| a beneficial interest in the: (i) |_| Rule 144A Global Security (CUSIP _______), or (ii) |_| Rule 501 Global Security (CUSIP _______); or (iii) |_| Regulation S Global Security (CUSIP ______), or (iv) |_| Unrestricted Global Security (CUSIP ______), or (b) |_| a Restricted Physical Security; or (c) |_| an Unrestricted Physical Security, in accordance with the terms of the Indenture. E-5 EXHIBIT F [Form of Certificate of Exchange] Leucadia National Corporation 315 Park Avenue South New York, New York 10010 [Registrar address block] Re: 7% Senior Notes due 2013 (CUSIP______________) Reference is hereby made to the Indenture, dated as of June 5, 2003 (the "Indenture"), between Leucadia National Corporation , as issuer (the "Company"), and JPMorgan Chase Bank, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. ____________ (the "Owner") owns and proposes to exchange the Security[ies] or interest in such Security[ies] specified herein, in the principal amount of ____________ in such Security[ies] or interests (the "Exchange"). In connection with the Exchange, the Owner hereby certifies that: 1. EXCHANGE OF RESTRICTED PHYSICAL SECURITIES OR BENEFICIAL INTERESTS IN A RESTRICTED GLOBAL SECURITY FOR UNRESTRICTED PHYSICAL SECURITIES OR BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL SECURITY (a) |_| CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL SECURITY TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL SECURITY. In connection with the Exchange of the Owner's beneficial interest in a Restricted Global Security for a beneficial interest in an Unrestricted Global Security in an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Global Securities and pursuant to and in accordance with the United States Securities Act of 1933, as amended (the "Securities Act"), (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest in an Unrestricted Global Security is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (b) |_| CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITY TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL SECURITY. In connection with the Owner's Exchange of a Restricted Physical Security for a beneficial interest in an Unrestricted Global Security, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own F-1 account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Physical Securities and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the beneficial interest is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. (c) |_| CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITY TO UNRESTRICTED PHYSICAL SECURITY. In connection with the Owner's Exchange of a Restricted Physical Security for an Unrestricted Physical Security, the Owner hereby certifies (i) the Unrestricted Physical Security is being acquired for the Owner's own account without transfer, (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to Restricted Physical Securities and pursuant to and in accordance with the Securities Act, (iii) the restrictions on transfer contained in the Indenture and the Private Placement Legend are not required in order to maintain compliance with the Securities Act and (iv) the Unrestricted Physical Security is being acquired in compliance with any applicable blue sky securities laws of any state of the United States. 2. EXCHANGE OF RESTRICTED PHYSICAL SECURITIES FOR RESTRICTED PHYSICAL SECURITIES OR BENEFICIAL INTERESTS IN RESTRICTED GLOBAL SECURITIES. (a) |_| CHECK IF EXCHANGE IS FROM RESTRICTED PHYSICAL SECURITY TO BENEFICIAL INTEREST IN A RESTRICTED GLOBAL SECURITY. In connection with the Exchange of the Owner's Restricted Physical Security for a beneficial interest in the [CHECK ONE] __ Rule 144A Global Security, ___ Rule 501 Global Security, __ Regulation S Global Security with an equal principal amount, the Owner hereby certifies (i) the beneficial interest is being acquired for the Owner's own account without transfer and (ii) such Exchange has been effected in compliance with the transfer restrictions applicable to the Restricted Global Securities and pursuant to and in accordance with the Securities Act, and in compliance with any applicable blue sky securities laws of any state of the United States. Upon consummation of the proposed Exchange in accordance with the terms of the Indenture, the beneficial interest issued will be subject to the restrictions on transfer enumerated in the Private Placement Legend printed on the relevant Restricted Global Security and in the Indenture and the Securities Act. F-2 This certificate and the statements contained herein are made for your benefit and the benefit of the Company. -------------------------------------------- [Insert Name of Owner] By: --------------------------------------- Name: Title: Dated: ________________ F-3 EXHIBIT G [Form of Certificate from Acquiring Accredited Investor] Leucadia National Corporation 315 Park Avenue South New York, New York 10010 [Registrar address block] Re: 7% Senior Notes due 2013 (CUSIP______________) Reference is hereby made to the Indenture, dated as of June 5, 2003 (the "Indenture"), between Leucadia National Corporation , as issuer (the "Company"), and JPMorgan Chase Bank, as trustee. Capitalized terms used but not defined herein shall have the meanings given to them in the Indenture. In connection with our proposed purchase of $____________ aggregate principal amount of: (a) |_| a beneficial interest in a Global Security, or (b) |_| a Physical Security, we confirm that: 1. We understand that any subsequent transfer of the Securities or any interest therein is subject to certain restrictions and conditions set forth in the Indenture and the undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Securities or any interest therein except in compliance with, such restrictions and conditions and the United States Securities Act of 1933, as amended (the "Securities Act"). 2. We understand that the offer and sale of the Securities have not been registered under the Securities Act, and that the Securities and any interest therein may not be offered or sold except as permitted in the following sentence. We agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter stated, that if we should sell the Securities or any interest therein, we will do so only (A) to the Company or any Subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to a "qualified institutional buyer" (as defined therein), (c) to an "accredited investor" (as defined below) that, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to you and to the Company a signed letter substantially in the form of this letter and, if such transfer is in respect of a principal amount of Securities, at the time of transfer, of less than $250,000, an Opinion of Counsel in form reasonably acceptable to the Company to the effect that such transfer is in compliance with the Securities G-1 Act, (D) outside the United States in accordance with Rule 904 of Regulation S under the Securities Act, (E) pursuant to the provisions of Rule 144(k) under the Securities Act or (F) pursuant to an effective registration statement under the Securities Act, and we further agree to provide to any person purchasing the Physical Security or beneficial interest in a Global Security from us in a transaction meeting the requirements of clauses (A) through (E) of this paragraph a notice advising such purchaser that resales thereof are restricted as stated herein. 3. We understand that, on any proposed resale of the Securities or beneficial interest therein, we will be required to furnish to you and the Company such certifications, legal opinions and other information as you and the Company may reasonably require to confirm that the proposed sale complies with the foregoing restrictions. We further understand that the Securities purchased by us will bear a legend to the foregoing effect. 4. We are an "accredited investor" (as defined in Rule 501(a) of Regulation D under the Securities Act) and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Securities, and we and any accounts for which we are acting are each able to bear the economic risk of our or its investment. 5. We are acquiring the Securities or beneficial interest therein purchased by us for our own account or for one or more accounts (each of which is an "accredited investor") as to each of which we exercise sole investment discretion. You and the Company are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. -------------------------------------- [Insert Name of Accredited Investor] By: ----------------------------------- Name: Title: Dated: ________________ G-2 EX-4 4 ex4-2.txt EXHIBIT 4.2 LEUCADIA NATIONAL CORPORATION $200,000,000 7% Senior Notes due 2013 REGISTRATION RIGHTS AGREEMENT June 5, 2003 JEFFERIES & COMPANY, INC. 11100 Santa Monica Boulevard, 10th Floor Los Angeles, California 90025 Ladies and Gentlemen: Leucadia National Corporation, a New York corporation (the "Company"), is issuing and selling to Jefferies & Company, Inc. (the "Initial Purchaser"), upon the terms set forth in a purchase agreement, dated as of May 29, 2003 (the "Purchase Agreement"), $200,000,000 aggregate principal amount at maturity of the Company's 7% Senior Notes due 2013. As an inducement to the Initial Purchaser to enter into the Purchase Agreement, the Company agrees with the Initial Purchaser, for the benefit of the holders of the Securities (as defined below) (including, without limitation, the Initial Purchaser), as follows: 1. Definitions. Capitalized terms used herein without definition shall have their respective meanings set forth in the Purchase Agreement. As used in this Agreement, the following terms shall have the following meanings: Advice: See the last paragraph of Section 5. Agreement: This Registration Rights Agreement. Applicable Period: See Section 2(f). Business Day: Any day, other than a Saturday, a Sunday or a day on which banking institutions in the City of New York or at a place of payment are authorized or obligated by law, regulation or executive order to be closed. Closing Date: June 5, 2003. controlling person: See Section 7(a). DTC: See Section 5(i). Effectiveness Date: The 180th day following the Closing Date. Effectiveness Period: See Section 3(a). Event: See Section 4(a). Event Date: See Section 4(a). Exchange Act: The Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder. Exchange Offer: See Section 2(a). Exchange Offer Registration Statement: See Section 2(a). Exchange Securities: The 7% Senior Notes due 2013 of the Company, identical in all respects to the Notes, except for restrictive legends, to be issued under the Indenture. Filing Date: The 120th day following the Closing Date. Holder: Each holder of Registrable Securities. Holder Indemnified Parties: See Section 7(a). indemnified party: See Section 7(c). indemnifying parties: See Section 7(c). Indenture: The Indenture, dated as of the date hereof, between the Company and JPMorgan Chase Bank, as trustee, pursuant to which the Notes are being issued, as amended or supplemented from time to time, in accordance with the terms thereof. Initial Shelf Registration: See Section 3(a). Losses: See Section 7(a). Maximum Contribution Amount: See Section 7(d). NASD: The National Association of Securities Dealers, Inc. Participating Broker-Dealer: See Section 2(f). Person: An individual, trustee, corporation, limited liability company, partnership, limited liability partnership, joint stock company, joint venture, trust, unincorporated organization or association, government or any agency or political subdivision thereof, union, business association, firm or other entity. Private Exchange: See Section 2(g). Private Exchange Securities: See Section 2(g). Prospectus: The prospectus included in a Registration Statement at the time that such Registration Statement is declared effective (including, without limitation, a prospectus that -2- discloses information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A under the Securities Act), as amended or supplemented by any prospectus supplement with respect to the terms of the offering of any portion of the Securities covered by such Registration Statement, and all other amendments and supplements to the Prospectus, including post-effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such Prospectus. Registrable Securities: Any of the Notes, the Private Exchange Securities and the Exchange Securities received in the Exchange Offer that may not be sold without restriction under federal or state securities law. Registration Statement: Any registration statement of the Company that covers any of the Securities and that is filed pursuant to the provisions of this Agreement, including the Prospectus included therein, all amendments and supplements to such registration statement and Prospectus (including post-effective amendments), all exhibits thereto and all material incorporated by reference or deemed to be incorporated by reference therein. Rule 144: Rule 144 under the Securities Act, as such rule may be amended from time to time, or any similar rule (other than Rule 144A) or regulation hereafter adopted by the SEC. Rule 144A: Rule 144A under the Securities Act, as such rule may be amended from time to time, or any similar rule (other than Rule 144) or regulation hereafter adopted by the SEC. Rule 415: Rule 415 under the Securities Act, as such rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC. SEC: The Securities and Exchange Commission. Securities: The Notes, the Private Exchange Securities and the Exchange Securities, collectively. Securities Act: The Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder. Shelf Effectiveness Date: With respect to a Shelf Registration, the 90th day after the filing of such Shelf Registration. Shelf Filing Date: With respect to a Shelf Registration, the 30th day following (i) in the case of an Initial Shelf Registration, delivery of the Shelf Notice triggering the obligation to file such Initial Shelf Registration, and (ii) in the case of a Subsequent Shelf Registration, the cessation of effectiveness of the prior Shelf Registration. Shelf Notice: See Section 2(i). Shelf Registration: The Initial Shelf Registration and any Subsequent Shelf Registration. -3- Special Counsel: Counsel chosen by the holders of a majority in aggregate principal amount of Securities. Subsequent Shelf Registration: See Section 3(b). TIA: The Trust Indenture Act of 1939, as amended. Trustee: The trustee under the Indenture and, if any, the trustee under any indenture governing the Exchange Securities or the Private Exchange Securities. Underwritten Registration or Underwritten Offering: A registration in which securities of the Company are sold to an underwriter for reoffering to the public. Weekly Liquidated Damages Amount: With respect to any Event, an amount per week per $1,000 principal amount of Registrable Securities equal to $0.05 for the first 90-day period immediately following the applicable Event Date, increasing by an additional $0.05 per week per $1,000 principal amount of Registrable Securities with respect to each subsequent 90-day period, up to a maximum amount of $0.25 per week per $1,000 principal amount of Registrable Securities. 2. Exchange Offer. (a) The Company shall: (i) prepare and file with the SEC promptly after the date hereof, but in no event later than the Filing Date, a registration statement (the "Exchange Offer Registration Statement") on an appropriate form under the Securities Act with respect to a proposed offer (the "Exchange Offer") to the Holders to issue and deliver to such Holders, in exchange for the Notes, a like aggregate principal amount of Exchange Securities; (ii) use its reasonable best efforts to cause the Exchange Offer Registration Statement to become effective as promptly as practicable after the filing thereof, but in no event later than the Effectiveness Date; (iii) use its reasonable best efforts to keep the Exchange Offer Registration Statement effective until the consummation of the Exchange Offer pursuant to its terms; and (iv) unless the Exchange Offer would not be permitted by a policy of the SEC, commence the Exchange Offer and use its reasonable best efforts to, on or prior to 45 days after the Exchange Offer Registration Statement is declared effective, consummate the Exchange Offer and issue Exchange Securities in exchange for all Notes tendered prior thereto in the Exchange Offer. The Exchange Offer shall not be subject to any conditions, other than that the Exchange Offer does not violate Applicable Law or any applicable interpretation of the staff of the SEC. The term "Applicable Law" means any federal, state, local or foreign statute, law -4- (including, without limitation, common law) or ordinance, or judgment, decree, rule, regulation or order of any federal, state local or other governmental authority, governmental or regulatory agency or body, court, arbitrator or self-regulatory organization, domestic or foreign. (b) The Exchange Securities shall be issued under, and entitled to the benefits of, the Indenture or a trust indenture that is identical to the Indenture (other than such changes as are necessary to comply with any requirements of the SEC to effect or maintain the qualification thereof under the TIA). (c) In connection with the Exchange Offer, the Company shall: (i) mail to each Holder a copy of the Prospectus forming part of the Exchange Offer Registration Statement, together with an appropriate letter of transmittal that is an exhibit to the Exchange Offer Registration Statement, and any related documents; (ii) keep the Exchange Offer open for not less than 30 days after the date notice thereof is mailed to the Holders (or longer if required by Applicable Law); (iii) utilize the services of a depositary for the Exchange Offer with an address in the Borough of Manhattan, The City of New York; (iv) permit Holders to withdraw tendered Notes at any time prior to the close of business, New York time, on the last Business Day on which the Exchange Offer shall remain open; and (v) otherwise comply with all laws applicable to the Exchange Offer. (d) As soon as practicable after the close of the Exchange Offer, the Company shall: (i) accept for exchange all Notes validly tendered and not validly withdrawn pursuant to the Exchange Offer; (ii) deliver to the Trustee for cancellation all Notes so accepted for exchange; and (iii) cause the Trustee promptly to authenticate and deliver to each Holder of Notes, Exchange Securities equal in aggregate principal amount to the Notes of such Holder so accepted for exchange. (e) Interest on each Exchange Security and each Private Exchange Security will accrue from the last interest payment date on which interest was paid on the Notes surrendered in exchange therefor or, if no interest has been paid on the Notes, from the date of original issue of the Notes. Each Exchange Security and each Private Exchange Security shall bear interest at the rate set forth thereon; provided, that interest with respect to the period prior to the issuance thereof shall accrue at the rate or rates borne by the Notes surrendered in exchange therefor from time to time during such period. -5- (f) The Company shall include within the Prospectus contained in the Exchange Offer Registration Statement a section entitled "Plan of Distribution," containing a summary statement of the positions taken or policies made by the staff of the SEC with respect to the potential "underwriter" status of any broker-dealer that is the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of Exchange Securities received by such broker-dealer in the Exchange Offer (a "Participating Broker-Dealer"). Such "Plan of Distribution" section shall also allow the use of the Prospectus by all Persons subject to the prospectus delivery requirements of the Securities Act, including (without limitation) all Participating Brokers-Dealers, and include a statement describing the means by which Participating Broker-Dealers may resell the Exchange Securities. The Company shall use its reasonable best efforts to keep the Exchange Offer Registration Statement continuously effective and to amend and supplement the Prospectus to be lawfully delivered by all Persons subject to the prospectus delivery requirement of the Securities Act for the shorter of (i) such period of time as such Persons must comply with such requirements in order to resell the Exchange Securities and (ii) the period ending when all Registrable Securities covered by the Exchange Offer Registration Statement have been sold pursuant thereto (the "Applicable Period"). (g) If, prior to consummation of the Exchange Offer, the Initial Purchaser holds any Notes acquired by it and having the status as an unsold allotment in the initial distribution of the Notes, the Company shall, upon the request of the Initial Purchaser, simultaneously with the delivery of the Exchange Securities in the Exchange Offer, issue (pursuant to the same indenture as the Exchange Securities and subject to transfer restrictions thereon) and deliver to the Initial Purchaser, in exchange for the Notes held by the Initial Purchaser (the "Private Exchange"), a like principal amount of debt securities of the Company that are identical to the Exchange Securities (the "Private Exchange Securities"). The Private Exchange Securities shall bear the same CUSIP number as the Exchange Securities. (h) The Company may require each Holder participating in the Exchange Offer to represent to the Company that, at the time of the consummation of the Exchange Offer: (i) any Exchange Securities received by such Holder in the Exchange Offer will be acquired in the ordinary course of its business; (ii) such Holder will have no arrangement or understanding with any Person to participate in the distribution of the Exchange Securities within the meaning of the Securities Act or resale of the Exchange Securities in violation of the Securities Act; (iii) if such Holder is not a broker-dealer, that it is not engaged in and does not intend to engage in, the distribution of the Exchange Securities; (iv) if such Holder is a broker-dealer that will receive Exchange Securities for its own account in exchange for Notes that were acquired as a result of market-making or other trading activities, that it will deliver a prospectus, as required by law, in connection with any resale of such Exchange Securities; and (v) if such Holder is an affiliate of the Company, that it will comply with the registration and prospectus delivery requirements of the Securities Act applicable to it. (i) If: (i) prior to the consummation of the Exchange Offer, the Company or the Holders of a majority in aggregate principal amount of Registrable Securities determines in its or their reasonable judgment that (A) the Exchange Securities would not, upon receipt, be tradeable by the Holders thereof without restriction under the Securities Act and the Exchange Act and without material restrictions under applicable Blue Sky or state securities laws or (B) the interests of the Holders under this Agreement, taken as a whole, would be materially adversely -6- affected by the consummation of the Exchange Offer; (ii) applicable interpretations of the staff of the SEC would not permit the consummation of the Exchange Offer; (iii) subsequent to the consummation of the Private Exchange, any Holder of Private Exchange Securities so requests; (iv) the Exchange Offer is not consummated within 225 days of the Closing Date for any reason; or (v) in the case of (A) any Holder prohibited by law or SEC policy from participating in the Exchange Offer, (B) any Holder participating in the Exchange Offer that receives Exchange Securities that may not be sold without restriction under state and federal securities laws (other than due solely to the status of such Holder as an affiliate of the Company within the meaning of the Securities Act) or (C) any broker-dealer that holds Notes acquired directly from the Company or any of their respective affiliates and, in each such case contemplated by this clause (v), such Holder notifies the Company within 20 Business Days (provided that if a Holder has delivered a notice within such time period, any other Holder meeting the requirements set forth in clause (v)(A), (B) or (C) may thereafter submit a notice up to and including the date that is 20 Business Days following the Shelf Filing Date) following consummation of the Exchange Offer, then the Company shall promptly (and in any event within five Business Days) deliver to the Holders (or in the case of an occurrence of any event described in clause (v) of this Section 2(i), to any such Holder) and the Trustee notice thereof (the "Shelf Notice") and shall as promptly as possible thereafter (but in no event later than the Shelf Filing Date) file an Initial Shelf Registration pursuant to Section 3; provided, that no Holder (other than the Initial Purchaser) shall be entitled to have Securities held by it covered by such Shelf Registration unless such Holder agrees to be bound by all of the provisions of this Agreement applicable to such Holder. 3. Shelf Registration. If a Shelf Notice is required to be delivered pursuant to clause (i), (ii), (iii) or (iv) of Section 2(i), then this Section 3 shall apply to all Registrable Securities. Otherwise, upon consummation of the Exchange Offer in accordance with Section 2, the provisions of this Section 3 shall apply solely with respect to (i) Notes held by any Holder thereof not permitted to participate in the Exchange Offer, (ii) Notes held by any broker-dealer that acquired such Notes directly from the Company or any of their respective affiliates, and (iii) Exchange Securities that are not freely tradeable, in each case, as contemplated by clause (v) of Section 2(i). (a) Initial Shelf Registration. The Company shall prepare and file with the SEC a Registration Statement for an offering to be made on a continuous basis pursuant to Rule 415 covering all of the Registrable Securities (the "Initial Shelf Registration") subject to the Company's right pursuant to Section 3(c) to exclude the Registrable Securities of Holders that have not provided the information required to be furnished by such Holders pursuant to Section 3(c) hereof. The Company shall file with the SEC the Initial Shelf Registration as promptly as possible following the occurrence of the event described in Section 2(i) which triggered such filing obligation, but in no event later than the Shelf Filing Date. The Initial Shelf Registration shall be on Form S-1 or another appropriate form permitting registration of such Registrable Securities for resale by such Holders in the manner or manners designated by them (including, without limitation, one or more underwritten offerings). The Company (i) shall not permit any securities other than the Registrable Securities to be included in any Shelf Registration, and (ii) shall use its reasonable best efforts to cause the Initial Shelf Registration to be declared effective under the Securities Act as promptly as practicable after the filing thereof (but in no event later than the Shelf Effectiveness Date) and to keep the Initial Shelf Registration continuously -7- effective under the Securities Act until the date that is 24 months after the date it is declared effective (subject to extension pursuant to the last paragraph of Section 5) (the "Effectiveness Period"), or such shorter period ending when (i) all Registrable Securities covered by the Initial Shelf Registration have been sold in the manner set forth and as contemplated in the Initial Shelf Registration, (ii) a Subsequent Shelf Registration covering all of the Registrable Securities has been declared effective under the Securities Act, (iii) such Registrable Securities are eligible for resale pursuant to Rule 144(k) under the Securities Act or (iv) there ceases to be any outstanding Registrable Securities. (b) Subsequent Shelf Registrations. If any Shelf Registration ceases to be effective for any reason at any time during the Effectiveness Period (other than because of the sale of all of the Registrable Securities registered thereunder), the Company shall use its reasonable best efforts to obtain the prompt withdrawal of any order suspending the effectiveness thereof, and in any event shall within 30 days of such cessation of effectiveness file an amendment to the Shelf Registration in a manner reasonably expected to obtain the withdrawal of the order suspending the effectiveness thereof, or file an additional "shelf" Registration Statement pursuant to Rule 415 covering all of the Registrable Securities (a "Subsequent Shelf Registration"). If a Subsequent Shelf Registration is filed, the Company shall use its reasonable best efforts to cause the Subsequent Shelf Registration to be declared effective as promptly as practicable after such filing and to keep such Subsequent Shelf Registration continuously effective for a period equal to the number of days in the Effectiveness Period less the aggregate number of days during which the Initial Shelf Registration, and any previously filed Subsequent Shelf Registration, was previously effective. (c) Provision of Information. The Company may exclude from any Shelf Registration the Registrable Securities of any Holder who, without a reasonable basis, fails to furnish to the Company in writing, within 20 days after receipt of a written request therefor, the information specified in Item 507 or 508, as applicable, of Regulation S-K under the Securities Act for use in connection with any Shelf Registration or Prospectus or preliminary prospectus included therein. No such Holder shall be entitled to liquidated damages pursuant to Section 4 unless and until such Holder shall have provided such information. Each Holder whose Registrable Securities are to be included in a Shelf Registration Statement agrees to promptly furnish to the Company all additional information required to be disclosed in order to make the information previously furnished to the Company by such Holder not materially misleading. 4. Liquidated Damages. (a) The Company acknowledges and agrees that the Holders will suffer damages, and that it would not be feasible to ascertain the extent of such damages with precision, if the Company fails to fulfill its obligations hereunder. Accordingly, in the event of such failure, the Company agrees to pay liquidated damages to each Holder under the circumstances and to the extent set forth below: (i) if the Exchange Offer Registration Statement has not been filed with the SEC on or prior to the Filing Date; -8- (ii) if the Exchange Offer Registration Statement is not declared effective by the SEC on or prior to the Effectiveness Date; or (iii) if the Company has not exchanged Exchange Securities for all Notes validly tendered in accordance with the terms of the Exchange Offer within 45 days after the date on which the Exchange Offer Registration Statement is declared effective by the SEC; (iv) if obligated to file an Initial Shelf Registration and the Company fails to file such Initial Shelf Registration with the SEC on or prior to Shelf Filing Date; (v) if an Initial Shelf Registration is filed and such Initial Shelf Registration is not declared effective on or prior to the Shelf Effectiveness Date; or (vi) if a Shelf Registration is filed and declared effective by the SEC but thereafter ceases to be effective without being succeeded within 30 days by a Subsequent Shelf Registration filed and declared effective; (each of the foregoing an "Event," and the date on which the Event occurs being referred to herein as an "Event Date"). Upon the occurrence of any Event, the Company shall pay, or cause to be paid, in addition to amounts otherwise due under the Indenture and the Registrable Securities, as liquidated damages, and not as a penalty, to each Holder for each weekly period beginning on the Event Date an amount equal to the Weekly Liquidated Damages Amount per $1,000 principal amount of Registrable Securities held by such Holder; provided, that such liquidated damages will, in each case, cease to accrue (subject to the occurrence of another Event) on the date on which all Events have been cured. An Event under clause (i) above shall be cured on the date that the Exchange Offer Registration Statement (or, if an Initial Shelf Registration is required to be filed pursuant to clause (i), (ii) or (iii) of Section 2(i), the date that such Initial Shelf Registration) is filed with the SEC; an Event under clause (ii) above shall be cured on the date that the Exchange Offer Registration Statement (or, if an Initial Shelf Registration is required to be filed pursuant to clause (i), (ii) or (iii) of Section 2(i), the date that such Initial Shelf Registration) is declared effective by the SEC; an Event under clause (iii) above shall be cured on the earlier of the date (A) the Exchange Offer is consummated with respect to all Notes validly tendered or (B) the Company delivers a Shelf Notice to the Holders and the Trustee pursuant to clause (i), (ii) or (iii) of Section 2(i); an Event under clause (iv) above shall be cured on the date that such Initial Shelf Registration is filed with the SEC; an Event under clause (v) above shall be cured on the date that such Initial Shelf Registration is declared effective by the SEC; and an Event under clause (vi) above shall be cured on the earlier of (1) the date on which the applicable Shelf Registration is no longer subject to an order suspending the effectiveness thereof or proceedings relating thereto or (2) a new Subsequent Shelf Registration is declared effective. (b) The Company shall notify the Trustee within five Business Days after each Event Date. The Company shall pay the liquidated damages due on the Registrable Securities by depositing with the Trustee, in trust, for the benefit of the Holders thereof, by 12:00 noon, New -9- York City time, on or before the applicable semi-annual interest payment date for the Registrable Securities, immediately available funds in sums sufficient to pay the liquidated damages then due. The liquidated damages amount due shall be payable in the same manner as interest payments on the Notes on each interest payment date to the record Holder entitled to receive the interest payment to be made on such date as set forth in the Indenture. 5. Registration Procedures. In connection with the registration of any Securities pursuant to Sections 2 or 3, the Company shall effect such registrations to permit the sale of such Securities in accordance with the intended method or methods of disposition thereof, and pursuant thereto the Company shall: (a) Prepare and file with the SEC, as soon as practicable after the date hereof but in any event on or prior to the Filing Date, with respect to an Exchange Offer Registration Statement, and on or prior to the Shelf Filing Date, with respect to a Shelf Registration, as prescribed by Sections 2 and 3, respectively, and use its reasonable best efforts to cause each such Registration Statement to become effective and remain continuously effective as provided in this Agreement; provided, that if (i) such filing is pursuant to Section 3 or (ii) a Prospectus contained in an Exchange Offer Registration Statement filed pursuant to Section 2 is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Securities during the Applicable Period, before filing any Registration Statement or Prospectus or any amendments or supplements thereto, (A) the Company shall notify the Holders of the Registrable Securities covered by such Registration Statement, their Special Counsel, each Participating Broker-Dealer, the managing underwriters, if any, and their counsel of such filing at least five Business Days prior to making such filing, (B) if requested, the Company shall furnish to and afford the Holders of the Registrable Securities covered by such Registration Statement, their Special Counsel, each Participating Broker-Dealer, the managing underwriters, if any, and their counsel a reasonable opportunity to review, and shall make available for inspection by such Persons, copies of all such documents (including copies of any documents to be incorporated by reference therein and all exhibits thereto) proposed to be filed and such financial and other information and books and records of the Company, as shall be necessary, in the opinion of Special Counsel and the respective counsels to such Participating Broker-Dealers and underwriters, to conduct a reasonable due diligence investigation within the meaning of the Securities Act, and (C) the Company shall cause the members, managers, officers, directors and employees of the Company, and counsel and independent certified public accountants of the Company, to respond to such inquiries, as shall be necessary, in the opinion of Special Counsel and the respective counsels to such Participating Broker-Dealers and underwriters, to conduct a reasonable due diligence investigation within the meaning of the Securities Act. The Company may require each Holder to agree in writing to keep confidential any non-public information relating to the Company received by such Holder, to refrain from using such information as the basis for any market transactions in the Securities of the Company and not to disclose such information (other than to an affiliate or prospective purchaser who agrees in writing to respect the confidentiality provisions of this Section 5(a)) until such information has been made generally available to the public unless the -10- release of such information is required by law or necessary to respond to inquiries of regulatory authorities. The Company shall not file any Registration Statement or Prospectus or any amendments or supplements thereto which the Holders must be afforded an opportunity to review prior to the filing of such document, if the Holders of a majority in aggregate principal amount of the Registrable Securities covered by such Registration Statement, their Special Counsel, any Participating Broker-Dealer or the managing underwriters, if any, or their counsel shall reasonably object to such filing within five Business Days after receipt of the Company's notice of filing described above in this Section 5(a). A Holder shall be deemed to have reasonably objected to such filing if such Registration Statement, amendment, Prospectus or supplement, as applicable, as proposed to be filed, contains an untrue statement of a material fact or omits to state any material fact necessary to make the statements therein not misleading or fails to comply with the applicable requirements of the Securities Act. (b) Provide an indenture trustee for the Registrable Securities or the Exchange Securities, as the case may be, and cause the Indenture (or other indenture relating to the Registrable Securities) to be qualified under the TIA not later than the effective date of the first Registration Statement; in connection therewith, effect such changes to such indenture as may be required for such indenture to be so qualified in accordance with the terms of the TIA; and execute, and use its reasonable best efforts to cause such trustee to execute, all documents as may be required to effect such changes, and all other forms and documents required to be filed with the SEC to enable such indenture to be so qualified in a timely manner. (c) Prepare and file with the SEC such pre-effective amendments and post-effective amendments to the Registration Statement as may be necessary in order to cause the Registration Statement to become effective and to keep such Registration Statement continuously effective for the time periods required hereby; cause the related Prospectus to be supplemented by any Prospectus supplement required by Applicable Law, and as so supplemented to be filed pursuant to Rule 424 (or any similar provisions then in force) under the Securities Act, and comply fully with Rules 424, 430A and 462, as applicable, under the Securities Act in a timely manner; and comply in all material respects with the provisions of the Securities Act and the Exchange Act applicable thereto with respect to the disposition of all securities covered by such Registration Statement, as so amended, or in such Prospectus, as so supplemented, in accordance with the intended methods of distribution set forth in such Registration Statement, as so amended, and such Prospectus, as so supplemented. (d) Furnish to such selling Holders and Participating Broker-Dealers who so request (i) upon the Company's receipt, a copy of the order of the SEC declaring such Registration Statement and any post-effective amendment thereto effective, (ii) such reasonable number of copies of such Registration Statement and of each amendment and supplement thereto (in each case including any documents incorporated therein by reference and all exhibits (including exhibits incorporated by reference) to such Registration Statement and each such amendment and supplement), (iii) such reasonable number of copies of the Prospectus included in such Registration Statement (including each preliminary prospectus and each supplement thereto), and such reasonable number -11- of copies of the final Prospectus as filed by the Company pursuant to Rule 424(b) under the Securities Act, in conformity with the requirements of the Securities Act, and (iv) such other documents (including any amendments and supplements required to be filed pursuant to Section 5(c) and any documents incorporated therein by reference and all exhibits thereto, including exhibits incorporated by reference), as any such Person may reasonably request. The Company hereby consents to the use of the Prospectus by each of the selling Holders of Registrable Securities and by each such Participating Broker-Dealer, as the case may be, and the underwriters or agents, if any, and dealers (if any), in connection with the offering and sale of the Registrable Securities covered by, or the sale by Participating Broker-Dealers of the Exchange Securities pursuant to, such Prospectus and any amendment or supplement thereto. (e) If (A) a Shelf Registration is filed pursuant to Section 3 or (B) a Prospectus contained in an Exchange Offer Registration Statement filed pursuant to Section 2 is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Securities during the Applicable Period, notify the selling Holders of Registrable Securities, their Special Counsel, each Participating Broker-Dealer and the managing underwriters, if any, promptly (but in any event within five Business Days), and, if requested by such Person, confirm such notice in writing, (i) when a Prospectus or any Prospectus supplement or Registration Statement or post-effective amendment has been filed, and, with respect to a Registration Statement or any post-effective amendment, when the same has become effective under the Securities Act, (ii) of the issuance by the SEC of any stop order suspending the effectiveness of a Registration Statement or of any order preventing or suspending the use of any Prospectus or the initiation of any proceedings for that purpose, (iii) if, at any time when a Prospectus is required by the Securities Act to be delivered in connection with sales of the Registrable Securities, the representations and warranties of the Company contained in any agreement (including any underwriting agreement) contemplated by Section 5(n) below cease to be true and correct in any material respect, (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of a Registration Statement or any of the Registrable Securities or the Exchange Securities to be sold by any Participating Broker-Dealer for offer or sale in any jurisdiction, or the contemplation, initiation or threatening of any proceeding for such purpose, (v) of the happening of any event that makes any statement made in such Registration Statement or related Prospectus or any document incorporated or deemed to be incorporated therein by reference to be untrue in any material respect or that requires the making of any additions to or changes in such Registration Statement, Prospectus or documents so that it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which such statements were made, not misleading, (vi) of the Company's reasonable determination that a post-effective amendment to a Registration Statement would be appropriate, and (vii) of any request by the SEC for amendments to the Registration Statement or supplements to the Prospectus or for additional information relating thereto. (f) Use its reasonable best efforts to register or qualify, and, if applicable, to cooperate with the selling Holders of Registrable Securities, the underwriters, if any, and -12- their respective counsel in connection with the registration or qualification (or exemption from such registration or qualification) of, Registrable Securities to be included in a Registration Statement for offer and sale under the securities or Blue Sky laws of such jurisdictions within the United States as any selling Holder, Participating Broker-Dealer or the managing underwriters reasonably request in writing; and, if Securities are offered other than through an Underwritten Offering, the Company shall cause its counsel to perform Blue Sky investigations and file registrations and qualifications required to be filed pursuant to this Section 5(f) at the expense of the Company; keep each such registration or qualification (or exemption therefrom) effective during the period such Registration Statement is required to be kept effective and do any and all other acts or things necessary or advisable to enable the disposition in such jurisdictions of the Securities covered by the applicable Registration Statement; provided, however, that the Company shall not be required to (i) register or qualify generally to do business in any jurisdiction where it is not then so qualified, (ii) take any action that would subject it to general service of process in any jurisdiction where it is not then so subject or (iii) take any action that would subject it to general taxation in respect of doing business in any such jurisdiction where it is not then so subject. (g) Use its reasonable best efforts to prevent the issuance of any order suspending the effectiveness of a Registration Statement or preventing or suspending the use of a Prospectus or suspending the qualification (or exemption from qualification) of any of the Securities for sale in any jurisdiction, and, if any such order is issued, use its best efforts to obtain the withdrawal or lifting of any such order at the earliest possible time. (h) If (i) a Shelf Registration is filed pursuant to Section 3 or (ii) a Prospectus contained in an Exchange Offer Registration Statement filed pursuant to Section 2 is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Securities during the Applicable Period, and if requested by the managing underwriters, if any, such Participating Broker-Dealer or the Holders of a majority in aggregate principal amount of the Registrable Securities, (A) promptly incorporate in a Prospectus supplement or post-effective amendment such information as the managing underwriters, if any, or such Holders reasonably request to be included therein as required to comply with any Applicable Law and (B) make all required filings of such Prospectus supplement or such post-effective amendment as soon as practicable after the Company has received notification of such matters required by Applicable Law to be incorporated in such Prospectus supplement or post-effective amendment. (i) If (i) a Shelf Registration is filed pursuant to Section 3 or (ii) a Prospectus contained in an Exchange Offer Registration Statement filed pursuant to Section 2 is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Securities during the Applicable Period, cooperate with the selling Holders, such Participating Broker-Dealer and the managing underwriters, if any, to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be sold, which certificates shall not bear any restrictive legends and shall be in a form eligible for deposit with The Depository Trust Company ("DTC"); and enable such Registrable Securities to be in such denominations and registered in such names as -13- the managing underwriters, if any, such Participating Broker-Dealer or the Holders may request. (j) If (i) a Shelf Registration is filed pursuant to Section 3 or (ii) a Prospectus contained in an Exchange Offer Registration Statement filed pursuant to Section 2 is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Securities during the Applicable Period, upon the occurrence of any event contemplated by Section 5(e)(v), 5(e)(vi) or 5(e)(vii), as promptly as practicable prepare a post-effective amendment to the Registration Statement, a supplement to the related Prospectus or a supplement or amendment to any such document incorporated or deemed to be incorporated therein by reference, or file any other required document so that, as thereafter delivered to the purchasers of the Registrable Securities being sold thereunder or to the purchasers of the Exchange Securities to whom such Prospectus will be delivered by a Participating Broker-Dealer, such Prospectus 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, in light of the circumstances under which they were made, not misleading, and, if SEC review is required, use its reasonable best efforts to cause such post-effective amendment to be declared effective as soon as practicable. (k) Use its reasonable best efforts to cause the Securities covered by a Registration Statement to be rated with the appropriate rating agencies, if appropriate, and if so requested by the holders of a majority in aggregate principal amount of Securities covered by such Registration Statement or the managing underwriters, if any. (l) Prior to the effective date of the first Registration Statement relating to the Securities, (i) provide the applicable trustee with printed certificates for the Securities in a form eligible for deposit with DTC and (ii) provide a CUSIP number for each of the Securities. (m) Use its reasonable best efforts to cause all Securities covered by such Registration Statement to be listed on each securities exchange, if any, on which similar debt securities issued by the Company are then listed. (n) If a Shelf Registration is filed pursuant to Section 3, enter into such agreements (including an underwriting agreement in form, scope and substance as is customary in Underwritten Offerings) and take all such other actions in connection therewith (including those reasonably requested by the managing underwriters, if any, or the Holders of a majority in aggregate principal amount of Registrable Securities being sold) in order to expedite or facilitate the registration or the disposition of such Registrable Securities, and in such connection, whether or not an underwriting agreement is entered into and whether or not the registration is an Underwritten Registration, (i) make such representations and warranties to the Holders and the underwriters, if any, with respect to the business of the Company and its subsidiaries, if any, and the Registration Statement, Prospectus and documents, if any, incorporated or deemed to be incorporated by reference therein, in each case, in form, substance and scope as are customarily made by Company to underwriters in Underwritten Offerings, and confirm -14- the same if and when reasonably requested; (ii) obtain opinions of counsel to the Company and updates thereof (which counsel and opinions (in form, scope and substance) shall be reasonably satisfactory to the managing underwriters, if any, and the Holders of a majority in aggregate principal amount of the Registrable Securities being sold), addressed to each selling Holder and each of the underwriters, if any, covering the matters customarily covered in opinions requested in Underwritten Offerings; (iii) obtain "cold comfort" letters and updates thereof (which letters and updates (in form, scope and substance) shall be reasonably satisfactory to the managing underwriters) from the independent certified public accountants of the Company (and, if necessary, any other independent certified public accountants of any subsidiary of the Company or of any business acquired by the Company for which financial statements and financial data are, or are required to be, included in the Registration Statement), addressed to each of the underwriters and each selling Holder, such letters to be in customary form and covering matters of the type customarily covered in "cold comfort" letters in connection with Underwritten Offerings and such other matters as reasonably requested by underwriters; and (iv) deliver such documents and certificates as may be reasonably requested by the Holders of a majority in principal amount of the Registrable Securities being sold and the managing underwriters, if any, to evidence the continued validity of the representations and warranties of the Company and its subsidiaries, if any, made pursuant to clause (i) above and to evidence compliance with any conditions contained in the underwriting agreement or other similar agreement entered into by the Company. (o) Comply with all applicable rules and regulations of the SEC and make generally available to its security holders earnings statements satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities Act) no later than 45 days after the end of any 12-month period (or 90 days after the end of any 12-month period if such period is a fiscal year) (i) commencing on the first day of the fiscal quarter following each fiscal quarter in which Registrable Securities are sold to underwriters in a firm commitment or best efforts underwritten offering and (ii) if not sold to underwriters in such an offering, commencing on the first day of the first fiscal quarter of the Company after the effective date of a Registration Statement, which statements shall cover said 12-month periods. (p) Upon consummation of an Exchange Offer or Private Exchange, obtain an opinion of counsel to the Company (in form, scope and substance reasonably satisfactory to the Initial Purchaser), addressed to all Holders participating in the Exchange Offer or Private Exchange, as the case may be, to the effect that (i) the Company has duly authorized, executed and delivered the Exchange Securities or the Private Exchange Securities, as the case may be, and the Indenture and (ii) the Exchange Securities or the Private Exchange Securities, as the case may be, and the Indenture constitute legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except as such enforcement may be subject to (A) applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally and (B) general principles of equity (regardless of whether such enforcement is sought in a proceeding in equity or at law). -15- (q) If an Exchange Offer or Private Exchange is to be consummated, upon delivery of the Registrable Securities by such Holders to the Company (or to such other Person as directed by the Company) in exchange for the Exchange Securities or the Private Exchange Securities, as the case may be, the Company shall mark, or caused to be marked, on such Registrable Securities that such Registrable Securities are being cancelled in exchange for the Exchange Securities or the Private Exchange Securities, as the case may be, and in no event shall such Registrable Securities be marked as paid or otherwise satisfied. (r) Cooperate with each seller of Registrable Securities covered by any Registration Statement and each underwriter, if any, participating in the disposition of such Registrable Securities and their respective counsel in connection with any filings required to be made with the NASD. (s) Use its reasonable best efforts to take all other steps necessary to effect the registration of the Registrable Securities covered by a Registration Statement contemplated hereby. Each Holder and each Participating Broker-Dealer agrees by acquisition of such Registrable Securities or Exchange Securities that, upon receipt of written notice from the Company of the happening of any event of the kind described in Section 5(e)(ii), 5(e)(iv), 5(e)(v), 5(e)(vi) or 5(e)(vii), such Holder will forthwith discontinue disposition (in the jurisdictions specified in a notice of a 5(e)(iv) event, and elsewhere in a notice of a 5(e)(ii), 5(e)(v), 5(e)(vi) or 5(e)(vii) event) of such Securities covered by such Registration Statement or Prospectus until the earlier of (i) such Holder's receipt of the copies of the amended or supplemented Prospectus contemplated by Section 5(j); or (ii) the time such Holder is advised in writing (the "Advice") by the Company that offers or sales in a particular jurisdiction may be resumed, or that the use of the applicable Prospectus may be resumed, as the case may be, and has received copies of any amendments or supplements thereto. If so directed by the Company in such notice, each Holder and each Participating Broker-Dealer will deliver to the Company (at the Company's expense) all copies of the Prospectus covering such Securities that was current at the time of such Holder's or Participating Broker-Dealer's receipt of such notice. If the Company shall give such notice, each of the Effectiveness Period and the Applicable Period shall be extended by the number of days during such periods from and including the date of the giving of such notice to and including the date when each seller of such Securities covered by such Registration Statement shall have received (x) the copies of the amended or supplemented Prospectus contemplated by Section 5(j) or (y) the Advice. 6. Registration Expenses. (a) All fees and expenses incident to the performance of or compliance with this Agreement by the Company shall be borne by the Company whether or not the Exchange Offer is consummated or the Exchange Offer Registration Statement or a Shelf Registration is filed or becomes effective, including, without limitation: (i) all registration and filing fees (including, without limitation, (A) fees with respect to filings required to be made with the NASD and (B) fees and expenses of -16- compliance with state securities or Blue Sky laws (including, without limitation, reasonable fees and disbursements of counsel in connection with Blue Sky qualifications of the Registrable Securities or Exchange Securities and determination of the eligibility of the Registrable Securities or Exchange Securities for investment under the laws of such jurisdictions (x) where the Holders are located, in the case of the Exchange Securities, or (y) as provided in Section 5(f), in the case of Registrable Securities or Exchange Securities to be sold by a Participating Broker-Dealer during the Applicable Period)); (ii) printing expenses (including, without limitation, expenses of printing certificates for Registrable Securities or Exchange Securities in a form eligible for deposit with DTC and of printing prospectuses if the printing of prospectuses is requested by the managing underwriters, if any, or, in respect of Registrable Securities or Exchange Securities to be sold by a Participating Broker-Dealer during the Applicable Period, by the Holders of a majority in aggregate principal amount of the Registrable Securities included in any Registration Statement or of such Exchange Securities, as the case may be); (iii) messenger, telephone, duplication, word processing and delivery expenses incurred by the Company in the performance of its obligations hereunder; (iv) fees and disbursements of counsel for the Company and, subject to Section 6(b), the Holders; (v) fees and disbursements of all independent certified public accountants referred to in Section 5(n)(iii) (including, without limitation, the expenses of any special audit and "cold comfort" letters required by or incident to such performance); (vi) fees and expenses of any "qualified independent underwriter" or other independent appraiser participating in an offering pursuant to Section 3 of Schedule E to the By-laws of the NASD, but only where the need for such a "qualified independent underwriter" arises due to a relationship with the Company; (vii) Securities Act liability insurance, if the Company so desires such insurance; (viii) fees and expenses of all other Persons, including special experts, retained by the Company; internal expenses of the Company (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), and the expenses of any annual audit; and (ix) rating agency fees and the fees and expenses incurred in connection with the listing of the Securities to be registered on any securities exchange. (b) The Company shall reimburse the Holders for the reasonable fees and disbursements of not more than one counsel (in addition to appropriate local counsel) chosen by the Holders of a majority in aggregate principal amount of the Registrable Securities to be -17- included in any Registration Statement and other reasonable and necessary out-of-pocket expenses of the Holders incurred in connection with the registration of the Registrable Securities. 7. Indemnification. (a) Indemnification by the Company. The Company shall, without limitation as to time, indemnify and hold harmless each Holder and each Participating Broker-Dealer, each Person who controls (within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act (any of such persons being hereinafter referred to as a "controlling person")) each such Holder and any such Participating Broker-Dealer and the members, managers, officers, directors, partners, employees, representatives and agents of each such Holder, Participating Broker-Dealer and controlling person (collectively, the "Holder Indemnified Parties"), to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, costs (including, without limitation, costs of preparation and reasonable attorneys' fees) and expenses (including, without limitation, costs and expenses incurred in connection with investigating, preparing, pursuing or defending against any of the foregoing) (collectively, "Losses"), as incurred, directly or indirectly caused by, related to, based upon, arising out of or in connection with any untrue or alleged untrue statement of a material fact contained in any Registration Statement, preliminary prospectus, Prospectus or form of prospectus, or in any amendment or supplement thereto, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except insofar as such Losses are based upon information relating to such Holder or Participating Broker-Dealer and furnished in writing to the Company by such Holder or Participating Broker-Dealer expressly for use therein; provided, that the Company shall not be liable under the indemnity provided in this Section 7(a) to any Holder Indemnified Party for any Losses that (A) result solely from an untrue statement of a material fact contained in, or the omission of a material fact from, any preliminary prospectus, which untrue statement or omission was corrected in the Prospectus (as then amended or supplemented) if it shall have been determined by a court of competent jurisdiction by final and nonappealable judgment that (1) such Holder Indemnified Party sold the Securities to the person alleging such Loss and failed to send or give, at or prior to the written confirmation of such sale, a copy of the Prospectus (as then amended or supplemented), if required by law to have so delivered it, and (2) the Company had previously furnished copies of the corrected Prospectus to such Holder Indemnified Party within a reasonable amount of time prior to such sale or such confirmation, and (3) the corrected Prospectus, if delivered, would have been a complete defense against the person asserting such Loss. The Company shall also indemnify underwriters, selling brokers, dealer managers and similar securities industry professionals participating in the distribution, their members, managers, officers, directors, agents and employees and each of their respective controlling persons to the same extent as provided above with respect to the indemnification of the Holder Indemnified Parties. (b) Indemnification by Holders of Registrable Securities. In connection with any Registration Statement, preliminary prospectus, Prospectus or form of prospectus, or any amendment or supplement thereto, in which a Holder is participating, such Holder shall furnish to the Company in writing such information as the Company reasonably request for use in connection with any such Registration Statement, preliminary prospectus, Prospectus or form of prospectus, any amendment or supplement thereto, and shall, severally and not jointly, without -18- limitation as to time, indemnify and hold harmless the Company, its members, managers, directors, officers, agents and employees, each controlling person of the Company and the members, managers, directors, officers, agents or employees of such controlling persons, to the fullest extent lawful, from and against any and all Losses, as incurred, arising out of or based upon any untrue or alleged untrue statement of a material fact contained in any such Registration Statement, preliminary prospectus, Prospectus or form of prospectus, or any amendment or supplement thereto, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading to the extent, but only to the extent, that such untrue statement or alleged untrue statement of a material fact or omission or alleged omission of a material fact is contained in or omitted from any information so furnished in writing by such Holder to the Company expressly for use in any Registration Statement, preliminary prospectus, Prospectus or form of prospectus, or any amendment or supplement thereto. In no event shall the liability of any selling Holder be greater in amount than such Holder's Maximum Contribution Amount (as defined below). (c) Conduct of Indemnification Proceedings. If any Proceeding shall be brought or asserted against any Person entitled to indemnification hereunder (an "indemnified party"), such indemnified party shall promptly notify the party or parties from which such indemnification is sought (the "indemnifying parties") in writing; provided, that the failure to so notify the indemnifying parties shall not relieve the indemnifying parties from any obligation or liability except to the extent (but only to the extent) that it shall be finally determined by a court of competent jurisdiction (which determination is not subject to appeal) that the indemnifying parties have been prejudiced materially by such failure. The indemnifying parties shall have the right, exercisable by giving written notice to an indemnified party, within 20 Business Days after receipt of written notice from such indemnified party of such Proceeding, to assume, at their expense, the defense of any such Proceeding; provided, that an indemnified party shall have the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such indemnified party or parties unless: (i) the indemnifying parties have agreed to pay such fees and expenses; (ii) the indemnifying parties shall have failed promptly to assume the defense of such Proceeding or shall have failed to employ counsel reasonably satisfactory to such indemnified party; or (iii) the named parties to any such Proceeding (including any impleaded parties) include both such indemnified party and one or more indemnifying parties (or any affiliates or controlling persons of any of the indemnifying parties), and such indemnified party shall have been advised by counsel that there may be one or more defenses available to such indemnified party that are in addition to, or in conflict with, those defenses available to the indemnifying party or such affiliate or controlling person (in which case, if such indemnified party notifies the indemnifying parties in writing that it elects to employ separate counsel at the expense of the indemnifying parties, the indemnifying parties shall not have the right to assume the defense thereof and the reasonable fees and expenses of such counsel shall be at the expense of the indemnifying parties; it being understood, however, that, the indemnifying parties shall not, in connection with any one such Proceeding or separate but substantially similar or related Proceedings in the same jurisdiction, arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than -19- one separate firm of attorneys (together with appropriate local counsel) at any time for such indemnified party). No indemnifying party shall be liable for any settlement of any such Proceeding effected without its written consent, but if settled with its written consent, or if there be a final judgment for the plaintiff in any such Proceeding, each indemnifying party agrees, subject to the exceptions and limitations set forth above, to indemnify and hold harmless each indemnified party from and against any and all Losses by reason of such settlement or judgment. The indemnifying party shall not consent to the entry of any judgment or enter into any settlement that does not include as an unconditional term thereof the giving by the claimant or plaintiff to each indemnified party of a release, in form and substance reasonably satisfactory to the indemnified party, from all liability in respect of such Proceeding for which such indemnified party would be entitled to indemnification hereunder (whether or not any indemnified party is a party thereto). (d) Contribution. If the indemnification provided for in this Section 7 is unavailable to an indemnified party or is insufficient to hold such indemnified party harmless for any Losses in respect of which this Section 7 would otherwise apply by its terms (other than by reason of exceptions provided in this Section 7), then each applicable indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such Losses, (i) in such proportion as is appropriate to reflect the relative benefits received by the indemnifying party, on the one hand, and such indemnified party, on the other hand, from the sale of Registrable Securities, or (ii) if the allocation provided by clause (i) above is not permitted by Applicable Law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the indemnifying party, on the one hand, and such indemnified party, on the other hand, in connection with the actions, statements or omissions that resulted in such Losses as well as any other relevant equitable considerations. The relative fault of such indemnifying party, on the one hand, and indemnified party, on the other hand, shall be determined by reference to, among other things, whether any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by such indemnifying party or indemnified party, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent any such statement or omission. The amount paid or payable by an indemnified party as a result of any Losses shall be deemed to include any legal or other fees or expenses incurred by such party in connection with any Proceeding, to the extent such party would have been indemnified for such fees or expenses if the indemnification provided for in Section 7(a) or 7(b) was available to such party. The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 7(d) were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in the immediately preceding paragraph. Notwithstanding the provisions of this Section 7(d), an indemnifying party that is a selling Holder shall not be required to contribute, in the aggregate, any amount in excess of such Holder's Maximum Contribution Amount. A selling Holder's "Maximum Contribution Amount" shall equal the excess, if any, of (i) the aggregate proceeds received by such Holder pursuant to the sale of the Registrable Securities giving rise to such indemnification obligation over (ii) the aggregate amount of damages that such Holder has -20- 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 Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. The Holders' obligations to contribute pursuant to this Section 7(d) are several in proportion to the respective principal amount of the Registrable Securities held by each Holder hereunder and not joint. The indemnity and contribution agreements contained in this Section 7 are in addition to any liability that the indemnifying parties otherwise may have to the indemnified parties. 8. Rule 144 and Rule 144A. The Company covenants that (a) during any period that it is required to file reports under the Securities Act or the Exchange Act, it shall file all reports required to be filed by it in a timely manner in order to permit resales of Registrable Securities pursuant to Rule 144 under the Securities Act and (b) during any period that it is not required to file such reports, it shall, upon the request of any Holder, make available to each Holder or beneficial owner of Registrable Securities and to any prospective purchaser of Registrable Securities designated by such Holder or beneficial owner the information required by Rule 144A(d)(4) under the Securities Act to permit resales of Registrable Securities pursuant to Rule 144A. The Company shall take such further action as any Holder may reasonably request, all to the extent required from time to time to enable such Holder to sell Registrable Securities without registration under the Securities Act pursuant to the exemptions provided by Rule 144 and Rule 144A. Upon the request of any Holder, the Company shall deliver to such Holder a written statement as to whether such Issuer has complied with such information requirements. Nothing in this Section 8 shall be deemed to require the Company to register any Securities pursuant to the Exchange Act. 9. Underwritten Registrations. If any of the Registrable Securities covered by any Shelf Registration are to be sold in an Underwritten Offering, the investment banker or investment bankers and manager or managers that will manage the offering will be selected by the Holders of a majority in aggregate principal amount of such Registrable Securities included in such offering with the consent of the Company, which consent shall not be unreasonably withheld or delayed. No Holder may participate in any Underwritten Registration hereunder unless such Holder (a) agrees to sell such Holder's Registrable Securities on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (b) completes and executes all questionnaires, powers of attorney, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements. 10. Miscellaneous. (a) Remedies. In the event of a breach by the Company of any of its obligations under this Agreement (other than an Event), each Holder, in addition to being entitled to exercise all rights provided herein, in the Indenture or, in the case of the Initial Purchaser, in the Purchase -21- Agreement, or granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Agreement. The Company agrees that monetary damages would not be adequate compensation for loss incurred by reason of such as breach by the Company and hereby further agrees that, in the event of any action for specific performance in respect of such a breach by the Company, the Company shall waive the defense that a remedy at law would be adequate. (b) No Inconsistent Agreements. The Company has not entered into, as of the date hereof, and shall not enter into, after the date of this Agreement, any agreement with respect to its securities that is inconsistent with the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof. For the avoidance of doubt, nothing in this Agreement shall limit the Company's ability to register shares underlying stock options granted to the Company's directors, officers and employees in the ordinary course of the Company's business. (c) Amendments and Waivers. The provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, unless the Company has obtained the written consent of Holders of at least a majority of the then outstanding aggregate principal amount of Registrable Securities; provided, that Sections 4(a) and 7 shall not be amended, modified or supplemented, and waivers or consents to departures from this proviso may not be given, unless the Company has obtained the written consent of each Holder. Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of Holders whose securities are being sold pursuant to a Registration Statement and that does not directly or indirectly affect the rights of other Holders may be given by Holders of at least a majority in aggregate principal amount of the Registrable Securities being sold by such Holders pursuant to such Registration Statement; provided that the provisions of this sentence may not be amended, modified or supplemented except in accordance with the provisions of the immediately preceding sentence. (d) Notices. All notices and other communications (including, without limitation, any notices or other communications to the Trustee) provided for or permitted hereunder shall be made in writing by hand-delivery, certified first-class mail with return receipt requested, next-day air courier or facsimile: (i) if to a Holder, at the most current address given by such Holder to the Company in accordance with the provisions of this Section 10(d), which address initially is, with respect to each Holder, the address of such Holder maintained by the Registrar (as defined in the Indenture); and (ii) if to the Company, initially at Leucadia National Corporation, 315 Park Avenue South, New York, New York 10010, facsimile number (212) 598-4869, Attention: Chief Financial Officer, with a copy to Weil, Gotshal & Manges LLP, 767 Fifth Avenue, New York, New York 10153, facsimile number (212) 310-8007, Attention: Andrea A. Bernstein, Esq., and thereafter at such other address, notice of which is given in accordance with the provisions of this Section 10(d). -22- All such notices and communications shall be deemed to have been duly given: when delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; one Business Day after being timely delivered to a next-day air courier, if sent by next-day air courier; and when receipt is acknowledged by the addressee, if sent by facsimile. Copies of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee under the Indenture at the address specified in the Indenture. (e) Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties hereto, including without limitation and without the need for an express assignment, subsequent Holders; provided, that nothing herein shall be deemed to permit any assignment, transfer or other disposition of Registrable Securities in violation of the terms hereof or of the Purchase Agreement or the Indenture. If any transferee of any Holder shall acquire Registrable Securities in any manner, whether by operation of law or otherwise, such Registrable Securities shall be held subject to all of the terms of this Agreement, and by taking and holding such Registrable Securities such Person shall be conclusively deemed to have agreed to be bound by and to perform all of the terms and provisions of this Agreement, including the restrictions on resale set forth in this Agreement and, if applicable, the Purchase Agreement, and such Person shall be entitled to receive the benefits hereof. (f) Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. (g) Headings. The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. When a reference is made in this Agreement to a Section, paragraph, subparagraph, Schedule or Exhibit, such reference shall mean a Section, paragraph, subparagraph, Schedule or Exhibit to this Agreement unless otherwise indicated. The words "include," "includes," and "including" when used in this Agreement shall be deemed in each case to be followed by the words "without limitation." The phrases "the date of this Agreement," "the date hereof," and terms of similar import, unless the context otherwise requires, shall be deemed to refer to June 5, 2003. The words "hereof," "herein," "herewith," "hereby" and "hereunder" and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement. (h) GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND INTERPRETED, AND THE RIGHTS OF THE PARTIES SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW AND RULE 327(b) OF NEW YORK CIVIL PRACTICE LAWS AND RULES. THE COMPANY HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN -23- THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS. THE COMPANY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, TRIAL BY JURY AND ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE COMPANY IRREVOCABLY CONSENTS, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, TO THE SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE COMPANY AT ITS ADDRESS SET FORTH HEREIN, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE INITIAL PURCHASER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE COMPANY IN ANY OTHER JURISDICTION. (i) Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their respective best efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable. (j) Entire Agreement. This Agreement is intended by the parties as a final expression of their agreement, and is intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein, with respect to the registration rights granted by the Company in respect of securities sold pursuant to the Purchase Agreement. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter. (k) Attorneys' Fees. In any Proceeding brought to enforce any provision of this Agreement, or where any provision hereof is validly asserted as a defense, the prevailing party, as determined by the courts, shall be entitled to recover reasonable attorneys' fees in addition to its costs and expenses and any other available remedy. (l) Securities Held by the Company or its Affiliates. Whenever the consent or approval of Holders of a specified percentage of the principal amount of Registrable Securities is -24- required hereunder, Registrable Securities held by the Company or its affiliates (as such term is defined in Rule 405 under the Securities Act) (other than Holders deemed to be such affiliates solely by reason of their holdings of such Registrable Securities) shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage. [signature pages follow this page] -25- IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. LEUCADIA NATIONAL CORPORATION By: /s/ Joseph A. Orlando ---------------------------- Name: Title: JEFFERIES & COMPANY, INC. By /s/ Andrew Whittaker --------------------------------- Name: Title: S-1 EX-5 5 ex5-1.txt EXHIBIT 5.1 EXHIBIT 5.1 July 15, 2003 LEUCADIA NATIONAL CORPORATION 315 Park Avenue South New York, New York 10010 Ladies and Gentlemen: We have acted as counsel to Leucadia National Corporation, a New York corporation (the 'Company'), in connection with the preparation and filing with the Securities and Exchange Commission of the Company's Registration Statement on Form S-4 (as amended, the 'Registration Statement'), under the Securities Act of 1933, as amended, relating to $200,000,000 aggregate principal amount of the Company's 7% Senior Notes due 2013 (the 'Notes'). In so acting, we have examined originals or copies, certified or otherwise identified to our satisfaction, of the Registration Statement, the Indenture dated as of June 5, 2003, between the Company and JPMorgan Chase Bank, as trustee (the 'Trustee'), pursuant to which the Notes will be issued (the 'Indenture'), the form of the Notes included in the Indenture filed as Exhibit 4.1 to the Registration Statement and such corporate records, agreements, documents and other instruments, and such certificates or comparable documents of public officials and of officers and representatives of the Company, and have made such inquiries of such officers and representatives, as we have deemed relevant and necessary as a basis for the opinion hereinafter set forth. In such examination, we have assumed the genuineness of all signatures, the legal capacity of natural persons, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified, conformed or photostatic copies and the authenticity of the originals of such latter documents. As to all questions of fact material to this opinion that have not been independently established, we have relied upon certificates or comparable documents of officers and representatives of the Company. Based on the foregoing, and subject to the qualifications stated herein, we are of the opinion that the Notes are duly authorized, and, when duly executed on behalf of the Company, authenticated by the Trustee and delivered in accordance with the terms of the Indenture and as contemplated by the Registration Statement, will constitute legal, valid and binding obligations of the Company, enforceable against it in accordance with their terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principals of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity). We consent to the reference to our name under the caption 'Legal Matters' in the prospectus which is a part of the Registration Statement. Very truly yours, /s/ Weil, Gotshal & Manges LLP EX-12 6 ex12-1.txt EXHIBIT 12.1 EXHIBIT 12.1 LEUCADIA NATIONAL CORPORATION COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (EXCLUDING INTEREST ON CUSTOMER BANKING DEPOSITS)
THREE MONTHS ENDED MARCH 31, YEAR ENDED DECEMBER 31, --------------------- ----------------------------------------------------- 2003 2002 2002 2001 2000 1999 1998 ---- ---- ---- ---- ---- ---- ---- (DOLLARS IN THOUSANDS) Income (loss) from continuing operations before cumulative effect of a change in accounting principles....... $(13,786) $ 11,303 $ 152,531 $ 62,928 $146,606 $187,748 $ 52,704 Add (deduct): Income taxes.............. 11,529 6,323 (111,178) (22,917) 75,496 36,863 (27,001) Fixed charges per below... 6,627 6,269 26,428 26,831 32,810 38,015 45,498 Equity in income (losses) of associated companies............... (4,068) (30,530) (91,373) 24,576 (29,293) 2,932 (23,290) Distributed income from equity investees........ 18,072 29,955 41,738 76,317 3,816 8,811 52,310 -------- -------- --------- -------- -------- -------- -------- Income, as adjusted... $ 18,374 $ 23,320 $ 18,146 $167,735 $229,435 $274,369 $100,221 -------- -------- --------- -------- -------- -------- -------- -------- -------- --------- -------- -------- -------- -------- Fixed charges: Interest on debt (excluding customer banking deposits)....... $ 3,893 $ 3,439 $ 15,512 $ 16,264 $ 21,688 $ 26,521 $ 30,402 Minority expense of trust preferred securities.... 2,124 2,124 8,495 8,495 8,494 8,494 12,689 Amortization of debt expense and premium..... 187 128 688 505 495 909 1,407 Portion of rent representative of the interest factor ( 1/3 of rents).................. 423 578 1,733 1,567 2,133 2,091 1,000 -------- -------- --------- -------- -------- -------- -------- Total fixed charges... $ 6,627 $ 6,269 $ 26,428 $ 26,831 $ 32,810 $ 38,015 $ 45,498 -------- -------- --------- -------- -------- -------- -------- -------- -------- --------- -------- -------- -------- -------- Ratio of earnings to fixed charges..................... 2.77 3.72 .69 6.25 6.99 7.22 2.20 -------- -------- --------- -------- -------- -------- -------- -------- -------- --------- -------- -------- -------- --------
Note: For the year ended December 31, 2002, earnings were inadequate to cover fixed charges by $8.3 million. EXHIBIT 12.1 LEUCADIA NATIONAL CORPORATION COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (INCLUDING INTEREST ON CUSTOMER BANKING DEPOSITS)
THREE MONTHS ENDED MARCH 31, YEAR ENDED DECEMBER 31, --------------------- ----------------------------------------------------- 2003 2002 2002 2001 2000 1999 1998 ---- ---- ---- ---- ---- ---- ---- (DOLLARS IN THOUSANDS) Income (loss) from continuing operations before cumulative effect of a change in accounting principles....... $(13,786) $ 11,303 $ 152,531 $ 62,928 $146,606 $187,748 $ 52,704 Add (deduct): Income taxes.............. 11,529 6,323 (111,178) (22,917) 75,496 36,863 (27,001) Fixed charges per below... 9,533 11,418 44,463 58,330 59,231 50,703 56,700 Equity in income (losses) of associated companies............... (4,068) (30,530) (91,373) 24,576 (29,293) 2,932 (23,290) Distributed income from equity investees........ 18,072 29,955 41,738 76,317 3,816 8,811 52,310 -------- -------- --------- -------- -------- -------- -------- Income, as adjusted... $ 21,280 $ 28,469 $ 36,181 $199,234 $255,856 $287,057 $111,423 -------- -------- --------- -------- -------- -------- -------- -------- -------- --------- -------- -------- -------- -------- Fixed charges: Interest on debt (including customer banking deposits)....... $ 6,799 $ 8,588 $ 33,547 $ 47,763 $ 48,109 $ 39,209 $ 41,604 Minority expense of trust preferred securities.... 2,124 2,124 8,495 8,495 8,494 8,494 12,689 Amortization of debt expense and premium..... 187 128 688 505 495 909 1,407 Portion of rent representative of the interest factor ( 1/3 of rents).................. 423 578 1,733 1,567 2,133 2,091 1,000 -------- -------- --------- -------- -------- -------- -------- Total fixed charges... $ 9,533 $ 11,418 $ 44,463 $ 58,330 $ 59,231 $ 50,703 $ 56,700 -------- -------- --------- -------- -------- -------- -------- -------- -------- --------- -------- -------- -------- -------- Ratio of earnings to fixed charges..................... 2.23 2.49 .81 3.42 4.32 5.66 1.97 -------- -------- --------- -------- -------- -------- -------- -------- -------- --------- -------- -------- -------- --------
Note: For the year ended December 31, 2002, earnings were inadequate to cover fixed charges by $8.3 million. EX-23 7 ex23-1.txt EXHIBIT 23.1 EXHIBIT 23.1 INDEPENDENT ACCOUNTANT'S CONSENT We hereby consent to the incorporation by reference in this Registration Statement on Form S-4 of Leucadia National Corporation of our report dated March 12, 2003 relating to the Company's financial statements and financial statement schedule, which appears in the Company's Annual Report on Form 10-K for the year ended December 31, 2002. We also consent to the reference to us under the heading 'Experts' in such registration statement. /s/ PriceWaterhouseCoopers LLP New York, New York July 9, 2003 EX-25 8 ex25-1.txt 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) ________ ---------------------------------------- JPMORGAN CHASE BANK (Exact name of trustee as specified in its charter) New York 13-4994650 (State of incorporation (I.R.S. employer if not a national bank) identification No.) 270 Park Avenue New York, New York 10017 (Address of principal executive offices) (Zip Code) William H. McDavid General Counsel 270 Park Avenue New York, New York 10017 Tel: (212) 270-2611 (Name, address and telephone number of agent for service) -------------------------------------------- LEUCADIA NATIONAL CORPORATION (Exact name of obligor as specified in its charter) Arizona 13-2615557 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification No.) 315 Park Avenue South New York, New York 10010 (Address of principal executive offices) (Zip Code) -------------------------------------------- 7% Senior Notes due 2013 (Title of the indenture securities) - -------------------------------------------------------------------------------- GENERAL Item 1. General Information. Furnish the following information as to the trustee: (a) Name and address of each examining or supervising authority to which it is subject. New York State Banking Department, State House, Albany, New York 12110. Board of Governors of the Federal Reserve System, Washington, D.C., 20551 Federal Reserve Bank of New York, District No. 2, 33 Liberty Street, New York, N.Y. Federal Deposit Insurance Corporation, Washington, D.C., 20429. (b) Whether it is authorized to exercise corporate trust powers. Yes. Item 2. Affiliations with the Obligor. If the obligor is an affiliate of the trustee, describe each such affiliation. None. -1- Item 16. List of Exhibits List below all exhibits filed as a part of this Statement of Eligibility. 1. A copy of the Restated Organization Certificate of the Trustee and the Certificate of Amendment dated November 9, 2001 (see Exhibit 1 to Form T-1 filed in connection with Registration Statement No. 333-73746 which is incorporated by reference). 2. A copy of the Certificate of Authority of the Trustee to Commence Business (see Exhibit 2 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference). On November 11, 2001, in connection with the merger of The Chase Manhattan Bank and Morgan Guaranty Trust Company of New York, the surviving corporation was renamed JPMorgan Chase Bank. 3. None, authorization to exercise corporate trust powers being contained in the documents identified above as Exhibits 1 and 2. 4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to Form T-1 filed in connection with Registration Statement No. 333-73746, which is incorporated by reference). 5. Not applicable. 6. The consent of the Trustee required by Section 321(b) of the Act (see Exhibit 6 to Form T-1 filed in connection with Registration Statement No. 33-50010, which is incorporated by reference). On November 11, 2001, in connection with the merger of The Chase Manhattan Bank and Morgan Guaranty Trust Company of New York, the surviving corporation, was renamed JPMorgan Chase Bank. 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. SIGNATURE Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee, JPMorgan Chase Bank, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in the City of New York and State of New York, on the 1st day of July 2003. JPMORGAN CHASE BANK By /s/ N. Moran ---------------------------- N. Moran Vice President -2- Exhibit 7 to Form T-1 Bank Call Notice RESERVE DISTRICT NO. 2 CONSOLIDATED REPORT OF CONDITION OF JPMorgan Chase Bank of 270 Park Avenue, New York, New York 10017 and Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business March 31, 2003, in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts ASSETS in Millions Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin ............................................... $ 21,415 Interest-bearing balances ....................................... 6,882 Securities: Held to maturity securities .......................................... 334 Available for sale securities ........................................ 80,076 Federal funds sold and securities purchased under agreements to resell Federal funds sold in domestic offices .......................... 14,044 Securities purchased under agreements to resell ................. 73,060 Loans and lease financing receivables: Loans and leases held for sale .................................. 25,832 Loans and leases, net of unearned income $161,345 Less: Allowance for loan and lease losses 3,823 Loans and leases, net of unearned income and allowance ....................................................... 157,522 Trading Assets ....................................................... 189,427 Premises and fixed assets (including capitalized leases).............. 6,186 Other real estate owned .............................................. 131 Investments in unconsolidated subsidiaries and associated companies ............................................ 691 Customers' liability to this bank on acceptances outstanding ..................................................... 225 Intangible assets Goodwill ..................................................... 2,180 Other Intangible assets ...................................... 3,314 Other assets ......................................................... 40,377 TOTAL ASSETS ......................................................... $621,696 ========
LIABILITIES Deposits In domestic offices .................................................... $174,351 Noninterest-bearing .................... $ 70,991 Interest-bearing ....................... 103,360 In foreign offices, Edge and Agreement subsidiaries and IBF's ................................................. 125,789 Noninterest-bearing .................... $ 7,531 Interest-bearing ....................... 118,258 Federal funds purchased and securities sold under agreements to repurchase: Federal funds purchased in domestic offices ............................ 5,929 Securities sold under agreements to repurchase ......................... 113,903 Trading liabilities ......................................................... 116,329 Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases) .............................. 10,758 Bank's liability on acceptances executed and outstanding .................... 225 Subordinated notes and debentures ........................................... 8,306 Other liabilities ........................................................... 29,735 TOTAL LIABILITIES ........................................................... 585,325 Minority Interest in consolidated subsidiaries .............................. 97 EQUITY CAPITAL Perpetual preferred stock and related surplus ............................... 0 Common stock ................................................................ 1,785 Surplus (exclude all surplus related to preferred stock) ................... 16,304 Retained earnings ........................................................... 17,228 Accumulated other comprehensive income ...................................... 957 Other equity capital components ............................................. 0 TOTAL EQUITY CAPITAL ........................................................ 36,274 -------- TOTAL LIABILITIES, MINORITY INTEREST, AND EQUITY CAPITAL .................... $621,696 ========
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true to the best of my knowledge and belief. JOSEPH L. SCLAFANI We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us, and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct. WILLIAM B. HARRISON, JR.) HELENE L. KAPLAN ) DIRECTORS WILLIAM H. GRAY, III ) EX-99 9 ex99-1.txt EXHIBIT 99.1 EXHIBIT 99.1 LETTER OF TRANSMITTAL LEUCADIA NATIONAL CORPORATION OFFER TO EXCHANGE 7% SENIOR NOTES DUE 2013 FOR ANY AND ALL OUTSTANDING 7% SENIOR NOTES DUE 2013 THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON , 2003 (THE 'EXPIRATION DATE') UNLESS EXTENDED BY LEUCADIA NATIONAL CORPORATION. JPMORGAN CHASE BANK By Registered or Certified Mail, By Facsimile: Hand or Overnight Courier: (For Eligible Institutions Only) JPMorgan Chase Bank (214) 468-6494 ITS Bond Events By Telephone: 2001 Bryan Street, 9th Floor (214) 468-6464 Dallas, TX 75201 Attn: Frank Ivins
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION VIA A FACSIMILE TRANSMISSION TO A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. The undersigned acknowledges receipt of the Prospectus dated , 2003 (the 'Prospectus') of Leucadia National Corporation (the 'Company'), and this Letter of Transmittal (the 'Letter of Transmittal'), which together describe the Company's offer (the 'Exchange Offer') to exchange $1,000 in principal amount of its 7% Senior Notes due 2013 (the 'Registered Notes') for each $1,000 in principal amount of outstanding 7% Senior Notes due 2013 (the 'Old Notes'). The terms of the Registered Notes are identical in all material respects (including principal amount, interest rate and maturity) to the terms of the Old Notes for which they may be exchanged pursuant to the Exchange Offer, except that the Registered Notes are freely transferable by holders thereof (except as provided herein or in the Prospectus) and are not subject to any covenant regarding registration under the Securities Act of 1933, as amended (the 'Securities Act'). The undersigned has checked the appropriate boxes below and signed this Letter of Transmittal to indicate the action the undersigned desires to take with respect to the Exchange Offer. PLEASE READ THE ENTIRE LETTER OF TRANSMITTAL AND THE PROSPECTUS CAREFULLY BEFORE CHECKING ANY BOX BELOW. YOUR BANK OR BROKER CAN ASSIST YOU IN COMPLETING THIS FORM. THE INSTRUCTIONS INCLUDED WITH THIS LETTER OF TRANSMITTAL MUST BE FOLLOWED. QUESTIONS AND REQUESTS FOR ASSISTANCE OR FOR ADDITIONAL COPIES OF THE PROSPECTUS AND THIS LETTER OF TRANSMITTAL MAY BE DIRECTED TO THE EXCHANGE AGENT. List below the Old Notes to which this Letter of Transmittal relates. If the space provided below is inadequate, the certificate numbers and principal amounts should be listed on a separate signed schedule affixed hereto. DESCRIPTION OF OLD NOTES
AGGREGATE PRINCIPAL NAME(S) AND ADDRESSES OF REGISTERED HOLDER(S) AMOUNT REPRESENTED PRINCIPAL AMOUNT (PLEASE FILL-IN) CERTIFICATE NUMBER(S) BY OLD NOTES* TENDERED** - ------------------------------------------------------------------------------------------------------------------ ------------------------------------------------------------------- ------------------------------------------------------------------- ------------------------------------------------------------------- ------------------------------------------------------------------- ------------------------------------------------------------------- TOTAL - ------------------------------------------------------------------------------------------------------------------
* Need not be completed by book-entry holders. ** Unless otherwise indicated, the holder will be deemed to have tendered the full aggregate principal amount represented by such Old Notes. See Instruction 2. This Letter of Transmittal is to be used either if certificates representing Old Notes are to be forwarded herewith or if delivery of Old Notes is to be made by book-entry transfer to an account maintained by the Exchange Agent at the Depository Trust Company (the 'Book-Entry Transfer Facility'), pursuant to the procedures set forth in the Prospectus under the caption 'The Exchange Offer -- Procedures for Tendering.' Delivery of documents to the Book-Entry Transfer Facility does not constitute delivery to the Exchange Agent. Holders whose Old Notes are not immediately available or who cannot deliver their Old Notes and all other documents required hereby to the Exchange Agent on or prior to the Expiration Date must tender their Old Notes according to the guaranteed delivery procedures set forth in the Prospectus under the caption 'The Exchange Offer -- Procedures for Tendering.' [ ] CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER MADE TO AN ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH THE BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING: Name of Tendering Institution(s) _______________________________________________ The Depository Trust Company Account Number ____________________________________ Transaction Code Number ________________________________________________________ [ ] CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY AND COMPLETE THE FOLLOWING: Name of Registered Holder(s) ___________________________________________________ Name of Eligible Institution that Guaranteed Delivery __________________________ Date of Execution of Notice of Guaranteed Delivery _____________________________ If Delivered by Book-Entry Transfer: ___________________________________________ Account Number _________________________________________________________________ [ ] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO: Name ___________________________________________________________________________ Address ________________________________________________________________________ If the undersigned is not a broker-dealer, the undersigned represents that it is not engaged in, and does not intend to engage in, a distribution of Registered Notes. If the undersigned is a broker-dealer that will receive Registered Notes for its own account in exchange for Old Notes that were acquired as result of market-making activities or other trading activities (other than Old Notes acquired directly from the Company), it acknowledges that it will deliver a prospectus in connection with any resale of such Registered Notes; however, by so acknowledging and by delivering a prospectus, the undersigned will not be deemed to admit that it is an 'underwriter' within the meaning of the Securities Act. Any holder who is an 'affiliate' of the Company or who has an arrangement or understanding with respect to the distribution of the Registered Notes to be acquired pursuant to the Exchange Offer, or any broker-dealer who purchased Old Notes from the Company to resell pursuant to Rule 144A under the Securities Act or any other available exemption under the Securities Act must comply with the registration and prospectus delivery requirements under the Securities Act. 2 PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY Ladies and Gentlemen: 1. Upon the terms and subject to the conditions of the Exchange Offer, the undersigned hereby tenders to the Company the aggregate principal amount at maturity of Old Notes indicated above. Subject to, and effective upon, the acceptance for exchange of the Old Notes tendered hereby, the undersigned hereby sells, assigns and transfers to, or upon the order of, the Company all right, title and interest in and to such Old Notes as are being tendered hereby. 2. The undersigned hereby represents and warrants that the undersigned has full power and authority to tender, sell, assign and transfer the Old Notes tendered hereby and that the Company will acquire good and unencumbered title thereto, free and clear of all liens, restrictions, charges and encumbrances and not subject to any adverse claim when the same are accepted by the Company. The undersigned hereby further represents that any Registered Notes acquired in exchange for Old Notes tendered hereby will have been acquired in the ordinary course of business of the person receiving such Registered Notes, whether or not such person is the undersigned, that neither the holder of such Old Notes nor any such other person is engaging in or intends to engage in a distribution of such Registered Notes and that neither the holder of such Old Notes nor any such other person is an 'affiliate,' as defined in Rule 405 under the Securities Act of 1933, as amended (the 'Securities Act'), of the Company. 3. The undersigned also acknowledges that the Exchange Offer is being made in reliance on an interpretation, made to third parties, by the staff of the Securities and Exchange Commission (the 'SEC') that the Registered Notes issued in exchange for the Old Notes pursuant to the Exchange Offer may be offered for resale, resold and otherwise transferred by holders thereof (other than any such holder that is an 'affiliate' of the Company within the meaning of Rule 405 under the Securities Act), without compliance with the registration and prospectus delivery provisions of the Securities Act, provided that such Registered Notes are acquired in the ordinary course of such holders' business, such holders are not engaging in and do not intend to engage in the distribution of such Registered Notes and such holders have no arrangements with any person to participate in the distribution of such Registered Notes. If the undersigned is not a broker-dealer, the undersigned represents that it is not engaged in, and does not intend to engage in, a distribution of Registered Notes. If the undersigned is a broker-dealer that will receive Registered Notes for its own account in exchange for Old Notes that were acquired as a result of market-making activities or other trading activities, it acknowledges that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of such Registered Notes. However, by so acknowledging and by delivering a prospectus, the undersigned will not be deemed to admit that it is an 'underwriter' within the meaning of the Securities Act. 4. The undersigned may, if, and only if, it would not receive freely tradable Registered Notes in the Exchange Offer or is not eligible to participate in the Exchange Offer, elect to have its Old Notes registered in the shelf registration described in the Registration Rights Agreement, dated as of June 5, 2003, between the Company and Jefferies & Company, Inc. (the 'Registration Agreement'). Capitalized terms used in this paragraph 4 and not otherwise defined herein shall have the meanings given to them in the Registration Agreement. Such election may be made by checking the box under 'Special Registration Instructions' below. By making such election, the undersigned agrees, as a holder of Old Notes participating in a Shelf Registration, to comply with the Registration Agreement and to indemnify and hold harmless the Company, its directors, officers, employees and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Securities Exchange Act of 1934, as amended (the 'Exchange Act'), from and against any and all losses, claims, damages, liabilities, judgments (including without limitation, any legal or other expenses incurred in connection with investigating or defending any judgments) caused by any untrue statement or alleged untrue statement of a material fact contained in such Registration Statement or any preliminary prospectus or prospectus forming a part thereof (or any amendment or supplement thereto), or the omission or alleged omission to state therein a material fact necessary to make the statements therein not misleading, but in each case only to the extent that the untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to the Company by or on behalf of the undersigned specifically for inclusion therein. Any such indemnification shall be governed by the terms and subject to the conditions set forth in the Registration Agreement, including, without limitation, the provisions regarding notice, 3 retention of counsel, contribution and payment of expenses set forth therein. The above summary of the indemnification provisions of the Registration Agreement is not intended to be exhaustive and is qualified in its entirety by the Registration Agreement. 5. The undersigned will, upon request, execute and deliver any additional documents deemed by the Company to be necessary or desirable to complete the sale, assignment and transfer of the Old Notes tendered hereby. All authority conferred or agreed to be conferred in this Letter and every obligation of the undersigned hereunder shall be binding upon the successors, assigns, heirs, executors, administrators, trustees in bankruptcy and legal representatives of the undersigned and shall not be affected by, and shall survive, the death or incapacity of the undersigned. This tender may be withdrawn only in accordance with the procedures set forth in the Prospectus under the caption 'The Exchange Offer -- Withdrawal Rights.' See Instruction 9. 6. Unless otherwise indicated in the box entitled 'Special Issuance Instructions' below, please issue the Registered Notes (and, if applicable, substitute certificates representing Old Notes for any Old Notes not exchanged) in the name of the undersigned or, in the case of a book-entry delivery of Old Notes, please credit the account indicated above maintained at the Book-Entry Transfer Facility. Similarly, unless otherwise indicated under the box entitled 'Special Delivery Instructions' below, please send the Registered Notes (and, if applicable, substitute certificates representing Old Notes for any Old Notes not exchanged) to the undersigned at the address shown above in the box entitled 'Description of Old Notes.' 4 THE UNDERSIGNED ACKNOWLEDGES THAT THE EXCHANGE OFFER IS SUBJECT TO THE MORE DETAILED TERMS SET FORTH IN THE PROSPECTUS AND, IN CASE OF ANY CONFLICT BETWEEN THE TERMS OF THE PROSPECTUS AND THIS LETTER, THE TERMS OF THE PROSPECTUS SHALL PREVAIL. THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED 'DESCRIPTION OF OLD NOTES' ABOVE AND SIGNING THIS LETTER, WILL BE DEEMED TO HAVE TENDERED THE OLD NOTES AS SET FORTH IN SUCH BOX ABOVE. SPECIAL ISSUANCE INSTRUCTIONS (SEE INSTRUCTIONS 2, 3, 4 AND 5) To be completed ONLY if certificates for Old Notes not exchanged and/or Registered Notes are to be issued in the name of someone other than the person or persons whose signature(s) appear(s) on this Letter below, or if Old Notes delivered by book-entry transfer which are not accepted for exchange are to be returned by credit to an account maintained at the Book-Entry Transfer Facility other than the account indicated above. Issue: Registered Notes and/or Old Notes to: Name(s): *__________________________________________________________________ (PLEASE TYPE OR PRINT) ____________________________________________________________________________ (PLEASE TYPE OR PRINT) ____________________________________________________________________________ Address: ___________________________________________________________________ ____________________________________________________________________________ ____________________________________________________________________________ (ZIP CODE) * (Such person(s) must properly complete a Form W-9, a Form W-8BEN, a Form W-8ECI, or a Form W-8IMY) Credit unchanged Old Notes delivered by book-entry transfer to the Book-Entry Transfer Facility account set forth below. ____________________________________________________________________________ (BOOK-ENTRY TRANSFER FACILITY ACCOUNT NUMBER, IF APPLICABLE) SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 3 AND 4) To be completed ONLY if certificates for Old Notes not exchanged and/or Registered Notes are to be sent to someone other than the person or persons whose signatures(s) appear(s) on this Letter below or to such person or persons at an address other than shown in the box entitled 'Description of Old Notes' on this Letter above. Mail Registered Notes and/or Old Notes to: Name(s): *__________________________________________________________________ (PLEASE TYPE OR PRINT) ____________________________________________________________________________ (PLEASE TYPE OR PRINT) ____________________________________________________________________________ Address: ___________________________________________________________________ ____________________________________________________________________________ (ZIP CODE) * (Such person(s) must properly complete a Form W-9, a Form W-8BEN, a Form W-8ECI, or a Form W-8IMY) 5 SPECIAL REGISTRATION INSTRUCTIONS (SEE PARAGRAPH 4 ABOVE) To be completed ONLY IF (i) the undersigned satisfies the conditions set forth in paragraph 4 above, (ii) the undersigned elects to register its Old Notes in the shelf registration described in the Registration Agreement, and (iii) the undersigned agrees to comply with the Registration Agreement and to indemnify certain entities and individuals as set forth in paragraph 4 above. [ ] By checking this box the undersigned hereby (i) represents that it is entitled to have its Old Notes registered in a shelf registration in accordance with the Registration Agreement, (ii) elects to have its Old Notes registered pursuant to the shelf registration described in the Registration Agreement, and (iii) agrees to comply with the Registration Agreement and to indemnify certain entities and individuals identified in, and to the extent provided in, paragraph 4 above. IMPORTANT: THIS LETTER OR A FACSIMILE HEREOF (TOGETHER WITH THE CERTIFICATES FOR OLD NOTES OR A BOOK-ENTRY CONFIRMATION AND ALL OTHER REQUIRED DOCUMENTS OR THE NOTICE OF GUARANTEED DELIVERY) MUST BE RECEIVED BY THE EXCHANGE AGENT PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL CAREFULLY BEFORE COMPLETING ANY BOX ABOVE. PLEASE SIGN HERE (TO BE COMPLETED BY ALL TENDERING HOLDERS) X ______________________________________________ ______________________, 2003 X ______________________________________________ ______________________, 2003 X ______________________________________________ ______________________, 2003 SIGNATURE(S) OF OWNER DATE Area Code and Telephone Number ________________________________________________ If a holder is tendering any Old Notes, this Letter must be signed by the registered holder(s) as the name(s) appear(s) on the certificate(s) for the Old Notes or by any person(s) authorized to become registered holder(s) by endorsements and documents transmitted herewith. If signature is by a trustee, executor, administrator, guardian, officer or other person acting in a fiduciary or representative capacity, please set forth full title. See Instruction 3. Name(s): ______________________________________________________________________ _______________________________________________________________________________ Capacity: _____________________________________________________________________ Address: ______________________________________________________________________ SIGNATURE GUARANTEE (IF REQUIRED BY INSTRUCTION 3) Signature(s) Guaranteed by an Eligible Institution: ______________________________________________________ (AUTHORIZED SIGNATURE) _______________________________________________________________________________ (TITLE) _______________________________________________________________________________ (NAME AND FIRM) 6 INSTRUCTIONS 1. DELIVERY OF THIS LETTER AND NOTES; GUARANTEED DELIVERY PROCEDURES. This Letter is to be completed by holders of Old Notes either if certificates are to be forwarded herewith or if tenders are to be made pursuant to the procedures for delivery by book-entry transfer set forth in the Prospectus under the caption 'The Exchange Offer -- Book-Entry Transfer.' Certificates for all physically tendered Old Notes, or Book-Entry Confirmation, as the case may be, as well as a properly completed and duly executed Letter (or manually signed facsimile thereof), with any required signature guarantees, and any other documents required by this Letter, must be received by the Exchange Agent at the address set forth herein on or prior to the Expiration Date, or the tendering holder must comply with the guaranteed delivery procedures set forth below. Old Notes tendered hereby must be in denominations or principal amount at maturity of $1,000 or any integral multiple thereof. Noteholders whose certificates for Old Notes are not immediately available or who cannot deliver their certificates and any other required documents to the Exchange Agent on or prior to the Expiration Date, or who cannot complete the procedure for book-entry transfer on a timely basis, may tender their Old Notes pursuant to the guaranteed delivery procedures set forth in the Prospectus under the caption 'The Exchange Offer -- Guaranteed Delivery Procedures.' Pursuant to such procedures, (i) such tender must be made through an Eligible Institution (as defined below), (ii) on or prior to 5:00 p.m., New York City time, on the Expiration Date, the Exchange Agent must receive from such Eligible Institution a properly completed and duly executed Letter (or a facsimile thereof) and Notice of Guaranteed Delivery, substantially in the form provided by the Company (by facsimile transmission, mail or hand delivery), setting forth the name and address of the holder of Old Notes and the amount of Old Notes tendered, stating that the tender is being made thereby and guaranteeing that within three New York Stock Exchange ('NYSE') trading days after the date of execution of the Notice of Guaranteed Delivery, the certificates for all physically tendered Old Notes in proper form for transfer, or a Book-Entry Confirmation, as the case may be, and any other documents required by this Letter will be deposited by the Eligible Institution with the Exchange Agent, and (iii) the certificates for all physically tendered Old Notes, in proper form for transfer, or Book-Entry Confirmation, as the case may be, and all other documents required by this Letter, must be received by the Exchange Agent within three NYSE trading days after the date of execution of the Notice of Guaranteed Delivery. THE METHOD OF DELIVERY OF THIS LETTER, THE OLD NOTES AND ALL OTHER REQUIRED DOCUMENTS IS AT THE ELECTION AND RISK OF THE TENDERING HOLDERS, BUT THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED OR CONFIRMED BY THE EXCHANGE AGENT. INSTEAD OF DELIVERY BY MAIL IT IS RECOMMENDED THAT HOLDERS USE AN OVERNIGHT OR HAND DELIVERY SERVICE. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE DELIVERY TO THE EXCHANGE AGENT PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. NO LETTER OF TRANSMITTAL OR OLD NOTES SHOULD BE SENT TO THE COMPANY. See 'The Exchange Offer' section in the Prospectus. 2. PARTIAL TENDERS. If less than all of the Old Notes evidenced by a submitted certificate are to be tendered, the tendering holder(s) should fill in the aggregate principal amount at maturity of Old Notes to be tendered in the box above entitled 'Description of Old Notes ' under 'Principal Amount Tendered.' A reissued certificate representing the balance of nontendered Old Notes of a tendering holder who physically delivered Old Notes will be sent to such tendering holder, unless otherwise provided in the appropriate box on this Letter, promptly after the Expiration Date. All of the Old Notes delivered to the Exchange Agent will be deemed to have been tendered unless otherwise indicated. 3. SIGNATURES ON THIS LETTER; BOND POWERS AND ENDORSEMENTS; GUARANTEE OF SIGNATURES. If this Letter is signed by the registered holder of the Old Notes tendered hereby, the signature must correspond exactly with the name as written on the face of the certificates without any change whatsoever. If any tendered Old Notes are owned of record by two or more joint owners, all such owners must sign this Letter. 7 If any tendered Old Notes are registered in different names on several certificates, it will be necessary to complete, sign and submit as many separate copies of this Letter as there are different registrations of certificates. When this Letter is signed by the registered holder or holders of the Old Notes specified herein and tendered hereby, no endorsements of certificates or separate bond powers are required. If, however, the Registered Notes are to be issued, or any untendered Old Notes are to be reissued, to a person other than the registered holder, then endorsements of any certificates transmitted hereby or separate bond powers are required. Signatures on such certificate(s) or bond powers must be guaranteed by an Eligible Institution. If this Letter is signed by a person other than the registered holder or holders of any certificate(s) specified herein, such certificates must be endorsed or accompanied by appropriate bond powers, in either case signed exactly as the name or names of the registered holder or holders appear(s) on the certificate(s) and signatures on such certificates(s) or bond powers must be guaranteed by an Eligible Institution. If this Letter or any certificates or bond powers are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, and, unless waived by the Company, proper evidence satisfactory to the Company of their authority to so act must be submitted with this Letter. Endorsements on certificates for Old Notes or signatures on bond powers required by this Instruction 3 must be guaranteed by a financial institution (including most banks, savings and loan associations and brokerage houses) that is a participant in the Securities Transfer Agents Medallion Program (each an 'Eligible Institution' and collectively, 'Eligible Institutions'). Signatures on the Letter need not be guaranteed by an Eligible Institution if (A) the Old Notes are tendered (i) by a registered holder of Old Notes (which term, for purposes of the Exchange Offer, includes any participant in the Book-Entry Transfer Facility system whose name appears on a security position listing as the holder of such Old Notes) who has not completed the box entitled 'Special Issuance Instructions' or 'Special Delivery Instructions' on this Letter, or (ii) for the account of an Eligible Institution and (B) the box entitled 'Special Registration Instructions' on this Letter has not been completed. 4. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. Tendering holders of Old Notes should indicate in the applicable box the name and address to which Registered Notes issued pursuant to the Exchange Offer and/or substitute certificates evidencing Old Notes not exchanged are to be issued or sent, if different from the name or address of the person signing this Letter. In the case of issuance in a different name, the employer identification or social security number of the person named must also be indicated and such person named must properly complete a Form W-9, a Form W-8BEN, a Form W-8ECI, or a Form W-8IMY. Noteholders tendering Old Notes by book-entry transfer may request that Old Notes not exchanged be credited to such account maintained at the Book-Entry Transfer Facility as such noteholder may designate hereon. If no such instructions are given, such Old Notes not exchanged will be returned to the name and address of the person signing this Letter. 5. TRANSFER TAXES. The Company will pay all transfer taxes, if any, applicable to the transfer of Old Notes to it or its order pursuant to the Exchange Offer. If, however, Registered Notes and/or substitute Old Notes not exchanged are to be delivered to, or are to be registered or issued in the name of, any person other than the registered holder of the Old Notes tendered hereby, or if tendered Old Notes are registered in the name of any person other than the person signing this Letter, or if a transfer tax is imposed for any reason other than the transfer of Old Notes to the Company or its order pursuant to the Exchange Offer, the amount of any such transfer taxes (whether imposed on the registered holder or any other persons) will be payable by the tendering holder. If satisfactory evidence of payment of such taxes or exemption therefrom is not submitted herewith, the amount of such transfer taxes will be billed directly to such tendering holder. 8 6. WAIVER OF CONDITIONS. The Company reserves the absolute right to waive satisfaction of any or all conditions enumerated in the Prospectus. 7. NO CONDITIONAL TENDERS. No alternative, conditional, irregular or contingent tenders will be accepted. All tendering holders of Old Notes, by execution of this Letter, shall waive any right to receive notice of the acceptance of their Old Notes for exchange. Although the Company intends to notify holders of defects or irregularities with respect to tenders of Old Notes, neither the Company, the Exchange Agent nor any other person shall incur any liability for failure to give any such notice. 8. MUTILATED, LOST, STOLEN OR DESTROYED OLD NOTES. Any holder whose Old Notes have been mutilated, lost, stolen or destroyed should contact the Exchange Agent at the address indicated above for further instructions. 9. WITHDRAWAL OF TENDERS. Tenders of Old Notes may be withdrawn at any time prior to 5:00 p.m., New York City time, on the Expiration Date. For a withdrawal of a tender of Old Notes to be effective, a written or facsimile transmission notice of withdrawal must be received by the Exchange Agent at its address set forth above prior to 5:00 p.m., New York City time, on the Expiration Date. Any such notice of withdrawal must (i) specify the name of the person having deposited the Old Notes to be withdrawn (the 'Depositor'), (ii) identify the Old Notes to be withdrawn (including the certificate number or numbers and principal amount of such Old Notes), (iii) be signed by the holder in the same manner as the original signature on this Letter by which such Old Notes were tendered (including any required signature guarantees) or be accompanied by documents of transfer sufficient to have the trustee under the Indenture pursuant to which the Old Notes were issued register the transfer of such Old Notes into the name of the person withdrawing the tender, and (iv) specify the name in which any such Old Notes are to be registered, if different from that of the Depositor. Any Old Notes so properly withdrawn will be deemed not to have been validly tendered for exchange for purposes of the Exchange Offer. Any Old Notes which have been tendered for exchange but which are not exchanged for any reason will be returned to the holder thereof without cost to such holder as soon as practicable after withdrawal, rejection of tender, or termination of the Exchange Offer. Properly withdrawn Old Notes may be retendered by following the procedures described above at any time on or prior to 5:00 p.m., New York City time, on the Expiration Date. All questions as to the validity, form, eligibility (including time of receipt), acceptance and withdrawal of tendered Old Notes will be determined by the Company in its sole discretion, which determination will be final and binding. The Company reserves the absolute right to reject any and all Old Notes not properly tendered or any Old Notes the Company's acceptance of which would, in the opinion of counsel for the Company, be unlawful. The Company also reserves the right to waive any defects, irregularities, or conditions of tender as to particular Old Notes. The Company's interpretation of the terms and conditions of the Exchange Offer (including the instructions of this Letter) will be final and binding on all parties. 10. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions relating to the procedure for tendering, as well as requests for additional copies of the Prospectus, this Letter and other related documents may be directed to the Exchange Agent, at the address and telephone number indicated above. 9 IMPORTANT TAX INFORMATION Each prospective holder of Registered Notes to be issued pursuant to Special Issuance Instructions should complete the attached Form W-9. Under current federal income tax law, a holder of Registered Notes is required to provide the Company (as payor) with such holder's correct taxpayer identification number ('TIN') on Form W-9 or otherwise establish a basis for exemption from backup withholding to prevent any backup withholding on any payments received in respect of the Registered Notes. If a holder of Registered Notes is an individual, the TIN is such holder's social security number. If the Company is not provided with the correct taxpayer identification number, a holder of Registered Notes may be subject to a $50 penalty imposed by the Internal Revenue Service. The Form W-9 need not be completed if the box entitled Special Issuance Instructions has not been completed. Certain holders of Registered Notes (including, among other, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. Exempt prospective holders of Registered Notes should indicate their exempt status on Form W-9. A foreign individual may qualify as an exempt recipient by submitting to the Company, through the Exchange Agent, the appropriate Internal Revenue Service Form W-8 (e.g., W-8BEN, Form W-8ECI or Form W-8IMY), properly completed and signed under penalty of perjury, attesting to the holder's exempt status. The appropriate W-8 will be provided by the Exchange Agent upon request. See the 'Internal Revenue Service Form W-9 -- Request For Taxpayer Identification Number and Certification' below for additional instructions. If backup withholding applies, the Company is required to withhold 28% of any 'reportable payment' made to the holder of Registered Notes or other payee. Backup withholding is not an additional federal income tax. Rather, the federal income tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund may be obtained from the Internal Revenue Service. PURPOSE OF FORM W-9 To prevent backup withholding with respect to any payments received in respect of the Registered Notes, each prospective holder of Registered Notes to be issued pursuant to Special Issuance Instructions should provide the Company, through the Exchange Agent, with either: (i) such prospective holder's correct TIN by completing the form below, certifying that the TIN provided on Form W-9 is correct (or that such prospective holder is awaiting a TIN), that such prospective holder is a U.S. person (including a U.S. resident alien), and that (A) such prospective holder has not been notified by the Internal Revenue Service that he or she is subject to backup withholding as a result of a failure to report all interest or dividends or (B) the Internal Revenue Service has notified such prospective holder that he or she is no longer subject to backup withholding; or (ii) an adequate basis for exemption. WHAT NUMBER TO GIVE THE EXCHANGE AGENT The prospective holder of Registered Notes to be issued pursuant to Special Issuance Instructions is required to give the Exchange Agent the TIN (e.g., social security number or employer identification number) of the prospective record owner of the Registered Notes. If the Registered Notes will be held in more than one name or are not held in the name of the actual owner, consult the 'Internal Revenue Service Form W-9 -- Request For Taxpayer Identification Number and Certification' below for additional guidance regarding which number to report. 10 Form W-9 Give form to the Request for Taxpayer requester. Do not (Rev. January 2003) Identification Number and Certification send to the IRS. Department of the Treasury Internal Revenue Service
Name Print or --------------------------------------------------------------------------------------------------------------- type Business name, if different from above. See Specific Instructions --------------------------------------------------------------------------------------------------------------- on page 2. Check Individual/ Exempt from appropriate box: [ ] Sole proprietor [ ] Corporation [ ] Partnership [ ] Other .... [ ] backup withholding --------------------------------------------------------------------------------------------------------------- Address (number, street, and apt or suite no.) Requester's name and address (optional) -------------------------------------------------------------------------- City, state and ZIP code --------------------------------------------------------------------------------------------------------------- List account number(s) here (optional) ---------------------------------------------------------------------------------------------------------------
Part I Taxpayer Identification Number (TIN) Enter your TIN in the appropriate box. For individuals, this is your social security number (SSN). Social security number However, for a resident alien, sole proprietor, or disregarded entity, see the Part I instructions / / / /-/ / /-/ / / / / on page 3. For other entities, it is your employer identification number (EIN). If you do not have a number, see How to get a TIN on page 3. Note: If the account is in more than one name, see Employer Identification the chart on page 4 for guidelines on whose number to enter. number / / /-/ / / / / / / / Part II Certification Under penalties of perjury, I certify that: 1. The number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me), and 2. I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (IRS) that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding, and 3. I am a U.S. person (including a U.S. resident alien). Certification instructions. You must cross out item 2 above if you have been notified by the IRS that you are currently subject to backup withholding because you have failed to report all interest and dividends on your tax return. For real estate transactions, item 2 does not apply. For mortgage interest paid, acquisition or abandonment of secured property, cancellation of debt, contributions to an individual retirement arrangement (IRA), and generally, payments other than interest and dividends, you are not required to sign the Certification, but you must provide your correct TIN. (See the instructions on page 4.) - -----------------------------------------------------------------------------------------------------------------------------
Purpose of Form A person who is required to file an information return with the IRS, must obtain your correct taxpayer identification number (TIN) to report, for example, income paid to you, real estate transactions, mortgage interest you paid, acquisition or abandonment of secured property, cancellation of debt, or contributions you made to an IRA. U.S. person. Use Form W-9 only if you are a U.S. person (including a resident alien), to provide your correct TIN to the person requesting it (the requester) and, when applicable. to: 1. Certify that the TIN you are giving is correct (or you are waiting for a number to be issued). 2. Certify that you are not subject to backup withholding or 3. Claim exemption from backup withholding if you are a U.S. exempt payee. Note: If a requester gives you a form other than Form W-9 to request your TIN, you must use the requester's form if it is substantially similar to this Form W-9. Foreign person. If you are a foreign person, use the appropriate Form W-8 (see Pub. 515, Withholding of Tax on Nonresident Aliens and Foreign Entities). Nonresident alien who becomes a resident alien. Generally, only a nonresident alien individual may use the terms of a tax treaty to reduce or eliminate U.S. tax on certain types of income. However, most tax treaties contain a provision known as a "saving clause." Exceptions specified in the saving clause may permit an exemption from tax to continue for certain types of income even after the recipient has otherwise become a U.S. resident alien for tax purposes. If you are a U.S. resident alien who is relying on an exception contained in the saving clause of a tax treaty to claim an exemption from U.S. tax on certain types of income, you must attach a statement that specifies the following five items: 1. The treaty country. Generally, this must be the same treaty under which you claimed exemption from tax as a nonresident alien. 2. The treaty article addressing the income. 3. The article number (or location) in the tax treaty that contains the saving clause and its exceptions. 4. The type and amount of income that qualifies for the exemption from tax. 5. Sufficient facts to justify the exemption from tax under the terms of the treaty article. - -------------------------------------------------------------------------------- Cat. No. 10231X Form W-9 (Rev. 1-2003) Form W-9 (Rev. 1-2003) Page 2 - -------------------------------------------------------------------------------- Example. Article 20 of the U.S.-China income tax treaty allows an exemption from tax for scholarship income received by a Chinese student temporarily present in the United States. Under U.S. law, this student will become a resident alien for tax purposes if his or her stay in the United States exceeds 5 calendar years. However, paragraph 2 of the first Protocol to the U.S.-China treaty (dated April 30, 1984) allows the provisions of Article 20 to continue to apply even after the Chinese student becomes a resident alien of the United States. A Chinese student who qualifies for this exception (under paragraph 2 of the first protocol) and is relying on this exception to claim an exemption from tax on his or her scholarship or fellowship income would attach to Form W-9 a statement that includes the information described above to support that exemption. If you are a nonresident alien or a foreign entity not subject to backup withholding, give the requester the appropriate completed Form W-8. What is backup withholding? Persons making certain payments to you must under certain conditions withhold and pay to the IRS 30% of such payments (29% after December 31, 2003, 28% after December 31, 2005). This is called "backup withholding." Payments that may be subject to backup withholding include interest, dividends, broker and barter exchange transactions, rents, royalties, nonemployee pay, and certain payments from fishing boat operators. Real estate transactions are not subject to backup withholding. You will not be subject to backup withholding on payments you receive if you give the requester your correct TIN, make the proper certifications, and report all your taxable interest and dividends on your tax return. Payments you receive will be subject to backup withholding if: 1. You do not furnish your TIN to the requester, or 2. You do not certify your TIN when required (see the Part II instructions on page 4 for details), or 3. The IRS tells the requester that you furnished an incorrect TIN, or 4. The IRS tells you that you are subject to backup withholding because you did not report all your interest and dividends on your tax return (for reportable interest and dividends only), or 5. You do not certify to the requester that you are not subject to backup withholding under 4 above (for reportable interest and dividend accounts opened after 1983 only). Certain payees and payments are exempt from backup withholding. See the instructions below and the separate Instructions for the Requester of Form W-9. Penalties Failure to furnish TIN. If you fail to furnish your correct TIN to a requester, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect. Civil penalty for false information with respect to withholding. If you make a false statement with no reasonable basis that results in no backup withholding, you are subject to a $500 penalty. Criminal penalty for falsifying information. Willfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment. Misuse of TINs. If the requester discloses or uses TINs in violation of Federal law, the requester may be subject to civil and criminal penalties. Specific Instructions Name If you are an individual, you must generally enter the name shown on your social security card. However, if you have changed your last name, for instance, due to marriage without informing the Social Security Administration of the name change, enter your first name, the last name shown on your social security card, and your new last name. If the account is in joint names, list first, and then circle, the name of the person or entity whose number you entered in Part I of the form. Sole proprietor. Enter your individual name as shown on your social security card on the "Name" line. You may enter your business, trade, or "doing business as (OBA)" name on the "Business name" line. Limited liability company (LLC). If you are a single-member LLC (including a foreign LLC with a domestic owner) that is disregarded as an entity separate from its owner under Treasury regulations section 301.7701-3, enter the owner's name on the "Name" line. Enter the LLC's name on the "Business name" line. Other entities. Enter your business name as shown on required Federal tax documents on the "Name" line. This name should match the name shown on the charter or other legal document creating the entity. You may enter any business, trade, or DBA name on the "Business name" line. Note: You are requested to check the appropriate box for your status (individual/sole proprietor, corporation, etc.). Exempt From Backup Withholding If you are exempt, enter your name as described above and check the appropriate box for your status, then check the "Exempt from backup withholding" box in the line following the business name, sign and date the form. Generally, individuals (including sole proprietors) are not exempt from backup withholding. Corporations are exempt from backup withholding for certain payments, such as interest and dividends. Note: If you are exempt from backup withholding, you should still complete this form to avoid possible erroneous backup withholding. Exempt payees. Backup withholding is not required on any payments made to the following payees: 1. An organization exempt from tax under section 501(a), any IRA, or a custodial account under section 403(b)(7) if the account satisfies the requirements of section 401(f)(2); 2. The United States or any of its agencies or instrumentalities; 3. A state, the District of Columbia, a possession of the United States, or any of their political subdivisions or instrumentalities; 4. A foreign government or any of its political subdivisions, agencies, or instrumentalities; or 5. An international organization or any of its agencies or instrumentalities. Other payees that may be exempt from backup withholding include: 6. A corporation; 7. A foreign central bank of issue; 8. A dealer in securities or commodities required to register in the United States, the District of Columbia, or a possession of the United States; - -------------------------------------------------------------------------------- Cat. No. 10231X Form W-9 (Rev. 1-2003) 9. A futures commission merchant registered with the Commodity Futures Trading Commission; 10. A real estate investment trust; 11. An entity registered at all times during the tax year under the Investment Company Act of 940; 12. A common trust fund operated by a bank under section 5134(a); 13. A financial institution; 14. A middleman known in the investment community as a nominee or custodian; or 15. A trust exempt from tax under section 664 or described in section 4947. The chart below shows types of payments that may be exempt from backup withholding. The chart applies to the exempt recipients listed above, 1 through 15.
If the payment is for... THEN the payment is exempt for... Interest and dividend payments All exempt recipients except for 9 Broker transactions Exempt recipients 1 through 13. Also, a person registered under the Investment Advisers Act of 1940 who regularly acts as a broker Barter exchange transactions Exempt recipients 1 through 5 and patronage dividends Payments over $600 required Generally, exempt recipients 1 to be reported and direct sales through 7(2) over $5,000(1)
(1) See Form 1099-MISC, Miscellaneous Income and its instructions. (2) However, the following payments made to a corporation (including gross proceeds paid to an attorney under section 6045(f), even if the attorney is a corporation) and reportable on Form 1099-MISC are not exempt from backup withholding; medical and health care payments, attorneys' fees; and payments for services paid by a Federal executive agency. Part I. Taxpayer Identification Number (TIN) Enter your TIN in the appropriate box. If you are a resident alien and you do not have and are not eligible to get an SSN, your TIN is your IRS individual taxpayer identification number (ITIN). Enter it in the social security number box. If you do not have an ITIN, see How to get a TIN below. If you are a sole proprietor and you have an EIN, you may enter either your SSN or EIN. However, the IRS prefers that you use your SSN. If you are a single-owner LLC that is disregarded as an entity separate from its owner (see Limited liability company (LLC) on page 2), enter your SSN (or EIN, if you have one). If the LLC is a corporation, partnership, etc., enter the entity's EIN. Note: See the chart on page 4 for further clarification of name and TIN combinations. How to get a TIN. If you do not have a TIN, apply for one immediately. To apply for an SSN, get Form SS-5, Application for a Social Security Card, from your local Social Security Administration office or get this form on-line at www.ssa.gov/online/ss5.htlm. You may also get this form by calling 1-800-772-1213. Use Form W-7, Application for IRS Individual Taxpayer Identification Number, to apply for an ITIN or Form SS-4, Application for Employee Identification Number to apply for an EIN. You can get Forms W-7 and SS-4 from the IRS by calling 1-800-TAX-FORM (1-800-829-3676) or from the IRS Web Site at www.irs.gov. If you are asked to complete Form W-9 but do not have a TIN, write "Applied For" in the space for the TIN, sign and date the form, and give it to the requester. For interest and dividend payments, and certain payments made with respect to tradable instruments, generally you will have 60 days to get a TIN and give it to the requester before you are subject to backup withholding on payments. The 60-day rule does not apply to other types of payments. You will be subject to backup withholding on all such payments until you provide your TIN to the requester. Note: Writing "Applied For" means that you have already applied for a TIN or that you intend to apply for one soon. Caution: A disregarded domestic entity that has a foreign owner must use the appropriate Form W-8. - -------------------------------------------------------------------------------- Cat. No. 10231X Form W-9 (Rev. 1-2003) Form W-9 (Rev. 1-2003) Page 4 - -------------------------------------------------------------------------------- Part II. Certification To establish to the withholding agent that you are a U.S. person, or resident alien, sign Form W-9. You may be requested to sign by the withholding agent even if items 1, 3, and 5 below indicate otherwise. For a joint account, only the person whose TIN is shown in Part I should sign (when required). Exempt recipients, see Exempt from backup withholding on page 2. Signature requirements. Complete the certification as indicated in 1 through 5 below. 1. Interest, dividend, and barter exchange accounts opened before 1984 and broker accounts considered active during 1983. You must give your correct TIN, but you do not have to sign the certification. 2. Interest, dividend, broker and barter exchange accounts opened after 1983 and brokers account considered active during 1983. You must sign the certification or backup withholding will apply. If you are subject backup withholding and you are merely providing your correct TIN to the requester, you must cross out item 2 in the certification before signing the form. 3. Real estate transactions. You must sign the certification. You may cross out item 2 of certification. 4. Other payments. You must give your correct TIN, but you do not have to sign the certification unless you have been notified that you have previously given an incorrect TIN. "Other payments" include payments made in the course of the requester's trade or business for rents, royalties, goods (other than bills for merchandise), medical and health care services (including payments to corporations), payments to a nonemployee for services, payments to certain fishing boat crew members and fishermen, and gross proceeds paid to attorneys (including payments to corporations). 5. Mortgage interest paid by you, acquisition or abandonment of secured property, cancellation of debt, qualified tuition program payments (under section 529), IRA or Archer MSA contributions or distributions, and pension distributions. You must give your correct TIN, but you do not have to sign the certification. What Name and Number to Give the Requester
For this type of account: Give name and SSN of: 1. Individual The individual 2. Two or more individuals The actual owner of the account or, if combined (joint account) funds, the first individual on the account(1) 3. Custodian account of a minor The minor(2) Uniform Gift to Minors Act) 4. a. The usual revocable The grantor-trustee(1) savings trust (grantor is also trustee) b. So-called trust account The actual owner(1) that is not a legal or valid trust under state law 5. Sole proprietorship or The owner(3) single-owner-LLC For this type of account: Give name and EIN of: 6. Sole proprietorship or The owner(3) single-owner 7. A valid trust, estate, or Legal entity(4) pension trust 8. Corporate of LLC electing The corporation corporate status on Form 8832 9. Association, club, religious, The organization charitable, educational, or other tax-exempt organization 10. Partnership or multi-member LLC The partnership 11. A broker or registered The broker or nominee nominee 12. Account with the Department of The public entity Agriculture in the name of a public entity (such as a state or local government, school district, or prison) that receives agricultural program payments
(1) List first and circle the name of the person whose number you furnish. If only one person on a joint account has an SSN, that person's number must be furnished. (2) Circle the minor's name and furnish the minor's SSN. (3) You must show your individual name, but you may also enter your business or "DBA" name. You may use either your SSN or EIN (if you have one). (4) List first and circle the name of the legal trust, estate, or pension trust. (Do not furnish the TIN of the personal representative or trustee unless the legal entity itself is not designated in the account title. Note: If no name is circled when more than one name is listed, the number will be considered to be that of the first name listed. - -------------------------------------------------------------------------------- Privacy Act Notice Section 6109 of the Internal Revenue Code requires you to provide your correct TIN to persons who must file information returns with the IRS to report interest, dividends, and certain other income paid to you, mortgage interest you paid, the acquisition or abandonment of secured property, cancellation of debt, or contributions you made to an IRA or Archer MSA. The IRS uses the number for identification purposes and to help verify the accuracy of your tax return. The IRS may also provide this information to the Department of Justice for civil and criminal litigation, and to cities, states, and the District of Columbia to carry out their tax laws. We may also disclose this information to other countries under a tax treaty, or to Federal and state agencies to enforce Federal nontax criminal laws and to combat terrorism. You must provide your TIN whether or not you are required to file a tax return. Payers must generally withhold 30% of taxable interest, dividend, and certain other payments to a payee who does not give a TIN to a payer. Certain penalties may also apply. - -------------------------------------------------------------------------------- Cat. No. 10231X Form W-9 (Rev. 1-2003) PLEASE COMPLETE THE FOLLOWING CERTIFICATE IF YOU WROTE "APPLIED FOR" IN PART I OF FORM W-9. CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (1) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration Office, or (2) I intend to mail or deliver an application in the near future. I understand that, notwithstanding the information I provided in Part II of the Form W-9 (and the fact that I completed this Certificate of Awaiting Taxpayer Identification Number), if I fail to provide a taxpayer identification number to the Depositary by the time of payment, 28% of all reportable payments made to me will be withheld until I provide a taxpayer identification number. If I fail to provide a taxpayer identification number within 60 days, such amounts will be paid over to the Internal Revenue Service. Signature:____________________________ Date:_____________, 2003 NOTE: FAILURE TO COMPLETE AND RETURN THE FORM W-9 MAY RESULT IN BACKUP WITHHOLDING OF 28% OF ANY PAYMENTS MADE TO YOU IN RESPECT OF THE REGISTERED NOTES DELIVERABLE TO YOU PURSUANT TO THE EXCHANGE OFFER. PLEASE REVIEW THE "INTERNAL REVENUE SERVICE" FORM W-9--REQUEST FOR TAXPAYER IDENTIFICATION NUMBER AND CERTIFICATION ABOVE FOR ADDITIONAL DETAILS. EX-99 10 ex99-2.txt EXHIBIT 99.2 EXHIBIT 99.2 NOTICE OF GUARANTEED DELIVERY LEUCADIA NATIONAL CORPORATION OFFER TO EXCHANGE 7% SENIOR NOTES DUE 2013 FOR ANY AND ALL OUTSTANDING 7% SENIOR NOTES DUE 2013 ------------------- This form or one substantially equivalent hereto must be used by registered holders of outstanding 7% Senior Notes due 2013 (the 'Old Notes') who wish to tender their Old Notes in exchange for a like principal amount of 7% Senior Notes due 2013 (the 'Registered Notes') pursuant to the exchange offer described in the Prospectus dated , 2003 (the 'Prospectus') if the holder's Old Notes are not immediately available or if such holder cannot deliver its Old Notes and Letter of Transmittal (and any other documents required by the Letter of Transmittal) to The Bank of New York (the 'Exchange Agent') prior to 5:00 p.m., New York City time, on , 2003. This Notice of Guaranteed Delivery may be delivered by hand or sent by facsimile transmission (receipt confirmed by telephone and an original delivered by guaranteed overnight courier) or mail to the Exchange Agent. See 'The Exchange Offer -- Procedures for Tendering -- Guaranteed Delivery Procedures' in the Prospectus. The Exchange Agent for the Exchange Offer is: THE BANK OF NEW YORK By Regular Mail: By Registered Mail or Overnight Courier: JPMorgan Chase Bank JPMorgan Chase Bank ITS Bond Events ITS Bond Events P.O. Box 2320 2001 Bryan Street, 9th Floor Dallas, TX 752213 Dallas, TX 75201 Attention: Frank Ivins
By Facsimile: (214) 468-6444 (For Eligible Institutions Only) By Telephone: (214) 468-6464 DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION VIA A FACSIMILE TRANSMISSION TO A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO GUARANTEE SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO BE GUARANTEED BY AN ELIGIBLE INSTITUTION (AS DEFINED IN THE PROSPECTUS), SUCH SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED ON THE LETTER OF TRANSMITTAL FOR GUARANTEE OF SIGNATURES. Ladies and Gentlemen: The undersigned hereby tenders to Leucadia National Corporation (the 'Company') the principal amount of Old Notes indicated below, upon the terms and subject to the conditions contained in the Prospectus, receipt of which is hereby acknowledged.
DESCRIPTION OF SECURITIES TENDERED NAME AND ADDRESS OF REGISTERED HOLDER AS IT CERTIFICATE PRINCIPAL APPEARS ON THE NUMBER(S) FOR AMOUNT OF OLD NOTES OLD NOTES OLD NOTES NAME OF TENDERING HOLDER (PLEASE PRINT) TENDERED TENDERED - ------------------------------------- -------------- ------------ ---------
PLEASE SIGN HERE X __________________________________________ X __________________________________________ X __________________________________________ X __________________________________________ X __________________________________________ X __________________________________________ SIGNATURE(S) OF OWNER DATE Must be signed by the holder(s) of Old Notes as their name(s) appear(s) on certificates for Old Notes or on a security position listing, or by person(s) authorized to become registered holder(s) by endorsement and documents transmitted with this Notice of Guaranteed Delivery. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer or other person acting in a fiduciary or representative capacity, such person must set forth his or her full title below. PLEASE PRINT NAME(S) AND ADDRESS(ES) Name(s): ______________________________________________________________________ ______________________________________________________________________ ______________________________________________________________________ Capacity:______________________________________________________________________ Address(es): __________________________________________________________________ __________________________________________________________________ __________________________________________________________________ [ ] The Depository Trust Company (Check if Old Notes will be tendered by book-entry transfer) Account Number: ____________________________________________________________
THE GUARANTEE ON THE FOLLOWING PAGE MUST BE COMPLETED. 2 THE FOLLOWING GUARANTEE MUST BE COMPLETED GUARANTEE OF DELIVERY (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, a member of a recognized signature guarantee medallion program within the meaning of Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended, hereby guarantees to deliver to the Exchange Agent at one of its addresses set forth above, the certificates representing the Old Notes (or a confirmation of book-entry transfer of such Old Notes into the Exchange Agent's account at The Depository Trust Company), together with a properly completed and duly executed Letter of Transmittal (or facsimile thereof), with any required signature guaranteed, and any other documents required by the Letter of Transmittal within three NYSE trading days after the date of execution of this Notice of Guaranteed Delivery. Name of Firm: ______________________________ __________________________________ (Authorized signature) Address: ___________________________________ Title: __________________________ ____________________________________________ Name: ___________________________ (Zip Code) (Please type or print) Area Code and Telephone No. ____________________________________________ Date: ___________________________
NOTE: DO NOT SEND OLD NOTES WITH THIS NOTICE OF GUARANTEED DELIVERY. OLD NOTES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL. 3 -----END PRIVACY-ENHANCED MESSAGE-----