Common use of of the Original Indenture Clause in Contracts

of the Original Indenture. The Debenture shall not be redeemed by the Issuer prior to April 30, 1999. Subject to Article 13 of the Original Indenture, on or after May 1, 1999, the Issuer shall have the right to redeem this Debenture at the option of the Issuer, without premium or penalty, in whole or in part, at a redemption price equal to 100% of the principal amount redeemed plus the accrued and unpaid interest thereon to the date fixed for redemption. Any redemption pursuant to this paragraph will be made upon not less than 30 nor more than 60 days notice to the Trustee and Holders of the Debentures (with the Trustee to be notified at least three days prior to notice to such Holders). If the Debentures are only partially redeemed by the Issuer, the notes will be redeemed pro rata or by lot or by any other method utilized by the Trustee; provided that if at the time of redemption, the Debentures are registered as a Global Debenture, the Depositary shall determine by lot the principal amount of such Debentures held by each Debenture holder to be redeemed. In the event of redemption of this Debenture in part only, a new Debenture or Debentures of this series for the unredeemed portion hereof will be issued in the name of the registered holder hereof upon the cancellation hereof. In case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, the principal of all of the Debentures may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Debenture upon compliance by the Issuer with certain conditions set forth therein. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the registered holders of not less than a majority in aggregate principal amount of the outstanding Debentures of all series affected at the time, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or of modifying in any manner the rights of the registered holders of the Debentures; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Debentures of any series, or reduce the principal amount thereof, or reduce the rate of or extend the time of payment of interest thereon (except that a valid extension of an interest payment period by the Issuer in accordance with the terms of any indenture supplemental hereto, shall not constitute an extension of interest for this purpose), or reduce any amount payable on redemption thereof, or make the principal thereof (including any amount in respect of original issue discount) or interest thereon payable in any coin or currency other than that provided herein or in accordance with the terms hereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof pursuant to Section 5.1 of the Original Indenture or the amount thereof provable in bankruptcy pursuant to Section 5.2 of the Original Indenture, or alter the provisions of Section 11.11 or 11.12 of the Original Indenture or impair or affect the right of any Securityholder to institute suit for the payment thereof or, if the Securities provide therefor, any right of repayment at the option of the Securityholder, or modify any provisions of the Indenture relating to the subordination of each Debenture in a manner adverse to such Holder, in each case without the consent of the registered holder of each Debenture so affected or (ii) reduce the aforesaid percentage of Debentures, the registered holders of which are required to consent to any such supplemental indenture, without the consent of the registered holders of each Debenture then outstanding and affected thereby. The Indenture also contains provisions permitting (i) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive compliance by the Issuer with certain provisions of the Indenture and (ii) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive certain past defaults under the Indenture and their consequences. Any such consent or waiver by the registered holder of this Debenture (unless revoked as provided in the Indenture) shall be conclusive and binding upon such registered holder and upon all future registered holders and owners of this Debenture and of any Debenture issued in exchange hereof or in place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Debenture. No reference herein to the Indenture and no provision of this Debenture or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Debenture at the time and place and at the rate and in the coin or currency herein prescribed. The Issuer shall have the right at any time, on one or more occasions, so long as an Event of Default has not occurred and is not continuing under the Indenture with respect to the Debentures, to extend any interest payment period on this Debenture for a period not to exceed 20 consecutive quarterly interest payment periods and, as a consequence, the quarterly interest payment on the Debentures would be deferred (but would continue to accrue with interest thereon compounded quarterly at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) during any such Deferral Period (as defined in the Indenture). At the end of each Deferral Period, the Issuer shall pay all interest then accrued and unpaid (compounded quarterly, at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) to the persons in whose name the Debentures are registered on the Record Date immediately preceding the Interest Payment Date at the end of such Deferral Period. In the event the Issuer exercises this right, the Issuer shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its Capital Stock (as defined in the Indenture) or make any guarantee payments with respect to the foregoing during such Deferral Period, other than redemptions of any series of Capital Stock of the Issuer pursuant to the terms of any sinking fund provisions with respect thereto. In addition, during any Deferral Period, the Issuer may not (i) make any distributions, loans or guarantees for the benefit of, (ii) purchase, defease, redeem or otherwise acquire or retire for value any securities of or (iii) make any other investment in any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer, for the purpose of, or to enable the payment of, directly or indirectly, dividends on any equity securities of Fund American Enterprises, Inc. and its successors or assigns. During any Deferral Period, the Issuer may continue to extend the interest payment period by extending the Deferral Period, on one or more occasions; provided that such Deferral Period, as extended, must end on an Interest Payment Date and in no event shall the aggregate Deferral Period, as extended, exceed 20 consecutive quarterly interest payment periods or extend beyond the maturity of the Debentures or any date on which any of the Debentures are fixed for redemption. No interest shall be due and payable on the Debentures during a Deferral Period except at the end thereof. The Issuer shall give the Trustee and the registered holders of Debentures notice (with the Trustee to receive notice at least three days prior to such Holders) of its election to defer interest payments or to extend the Deferral Period ten Business Days prior to the earlier of (i) the next scheduled quarterly Interest Payment Date or (ii) the date the Issuer is required to give notice of the record date of such related interest payment to the New York Stock Exchange or other applicable self-regulatory organization or to the holders of the Debentures, but in any event not less than two Business Days prior to such record date. As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Debenture is registrable in the Security Register of the Issuer, upon surrender of this Debenture for registration of transfer at the office or agency of the Issuer in any place where the principal of and any interest on this Debenture are payable or at such other offices or agencies as the Issuer may designate, duly endorsed by or accompanied by a written instrument or instruments of transfer in form satisfactory to the Issuer and the Security Registrar or any transfer agent duly executed by the registered holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Debentures of this series and of like tenor, of authorized denominations and for the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be made for any such transfer, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation thereto. Prior to due presentment for registration of transfer of this Debenture, the Issuer, the Trustee, any paying agent and any Debenture Registrar may deem and treat the registered holder hereof as the absolute owner hereof (whether or not this Debenture shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Debenture Registrar) for the purpose of receiving payment of or on account of the principal hereof and interest due hereon and for all other purposes, and neither the Issuer nor the Trustee nor any paying agent nor any Debenture Registrar shall be affected by any notice to the contrary. The Debentures of this series are issuable only in fully registered form without coupons in denominations of $25 and any integral multiple thereof. Debentures of this series so issued are issuable only in registered form without coupons in denominations of $25 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Debentures of this series are exchangeable for a like aggregate principal amount of Debentures of this series of a different authorized denomination, as requested by the registered holder surrendering the same. As set forth in, and subject to the provisions of, the Indenture, no registered owner of any Debenture will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless (i) such registered owner shall have previously given to the Trustee written notice of a continuing Event of Default with respect to the Debentures of this series, (ii) the registered owners of not less than 25% in principal amount of the outstanding Debentures of all affected series then Outstanding shall have made written request, and offered reasonable indemnity, to the Trustee to institute such proceeding as trustee, (iii) the Trustee shall have failed to institute such proceeding within 60 days and (iv) the Trustee shall not have received from the registered owners of a majority in principal amount of the outstanding Debentures of this series a direction inconsistent with such request within such 60-day period; provided, however, that such limitations do not apply to a suit instituted by a registered owner hereof for the enforcement of payment of the principal of or any interest on this Debenture on or after the respective due dates expressed herein, subject to deferral as set forth herein. All terms used in this Debenture which are defined in the Indenture shall have the meanings assigned to them in the Indenture. FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto ------------------------------------------------------------------------------- (Please insert Social Security or other number of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) the within Debenture and all rights thereunder, hereby irrevocably constituting and appointing such person attorneys to transfer the within Debenture on the books of the Issuer, with full power of substitution in the premises. Dated: _____________________ ___________________________________

of the Original Indenture. The Debenture shall not be redeemed by the Issuer prior to April 30, 1999. Subject to provisions of Article 13 4 of the Original Indenture, on or after May 1, 1999Indenture shall not apply to this Note. • Upon the occurrence of a Repurchase Event, the Issuer shall have Holder has the right to redeem this Debenture at the option of the Issuer, without premium or penalty, in whole or in partright, at such Holder’s option, to require the Company to repurchase all of such Holder’s Notes or any portion thereof (in principal amounts of $1,000 or integral multiples thereof) on the Repurchase Date at a redemption price equal to 100% the Repurchase Price. • As provided in and subject to the provisions of the Indenture, the Holder hereof has the right, at its option, prior to the close of business on the seventh Business Day immediately preceding May 15, 2014, to convert this Note or a portion thereof that is $1,000 or an integral multiple thereof, into Shares, the Cash Value or a combination of Shares and cash, at the Company’s discretion, at the applicable Conversion Ratio specified in the Indenture, as adjusted from time to time as provided in the Indenture. • As provided in and subject to the provisions of the Indenture, the Company shall make all payments and deliveries in respect of the Repurchase Price on the Repurchase Date and the principal amount redeemed plus on Stated Maturity thereof, as the accrued and unpaid interest thereon case may be, to the date fixed for redemption. Any redemption pursuant to this paragraph will be made upon not less than 30 nor more than 60 days notice Holder who surrenders a Note to the Trustee and Holders Paying Agent to collect such payments in respect of the Debentures (with Note. The Company shall pay cash amounts in money of the Trustee to be notified at least three days prior to notice to such Holders). If the Debentures are only partially redeemed by the Issuer, the notes will be redeemed pro rata or by lot or by any other method utilized by the Trustee; provided United States that if at the time of redemptionpayment is legal tender for payment of public and private debts. • The Indenture permits, with certain exceptions as therein provided, the Debentures are registered as amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders to be effected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a Global Debenture, the Depositary shall determine by lot the majority in principal amount of the Notes at the time outstanding. The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Notes at the time outstanding, on behalf of the Holders of all Notes, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such Debentures held consent or waiver by each Debenture holder to be redeemed. In the event of redemption Holder of this Debenture in part only, a new Debenture or Debentures Note shall be conclusive and binding upon such Holder and upon all future Holders of this series for Note and of any Note issued upon the unredeemed portion registration of transfer hereof will be issued or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note. • As provided in and subject to the name provisions of the registered holder hereof upon the cancellation hereof. In Indenture, in case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, the principal of and interest on all of the Debentures Notes may be declareddeclared due and payable, by either the Trustee or Holders of not less than 25% in aggregate principal amount of Notes then outstanding, and upon such said declaration shall become, become due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Debenture upon compliance by the Issuer with certain conditions set forth therein. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the registered holders of not less than a majority in aggregate principal amount of the outstanding Debentures of all series affected at the time, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or of modifying in any manner the rights of the registered holders of the Debentures; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Debentures of any series, or reduce the principal amount thereof, or reduce the rate of or extend the time of payment of interest thereon (except that a valid extension of an interest payment period by the Issuer in accordance with the terms of any indenture supplemental hereto, shall not constitute an extension of interest for this purpose), or reduce any amount payable on redemption thereof, or make the principal thereof (including any amount in respect of original issue discount) or interest thereon payable in any coin or currency other than that provided herein or in accordance with the terms hereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof pursuant to Section 5.1 of the Original Indenture or the amount thereof provable in bankruptcy pursuant to Section 5.2 of the Original Indenture, or alter the provisions of Section 11.11 or 11.12 of the Original Indenture or impair or affect the right of any Securityholder to institute suit for the payment thereof or, if the Securities provide therefor, any right of repayment at the option of the Securityholder, or modify any provisions of the Indenture relating to the subordination of each Debenture in a manner adverse to such Holder, in each case without the consent of the registered holder of each Debenture so affected or (ii) reduce the aforesaid percentage of Debentures, the registered holders of which are required to consent to any such supplemental indenture, without the consent of the registered holders of each Debenture then outstanding and affected thereby. The Indenture also contains provisions permitting (i) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive compliance by the Issuer with certain provisions of the Indenture and (ii) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive certain past defaults under the Indenture and their consequences. Any such consent or waiver by the registered holder of this Debenture (unless revoked as provided in the Indenture) shall be conclusive and binding upon such registered holder and upon all future registered holders and owners of this Debenture and of any Debenture issued in exchange hereof or in place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Debenture. • No reference herein to the Indenture and no provision of this Debenture Note or of the Indenture shall alter or impair the obligation of the IssuerCompany, which is absolute and unconditional, to pay the principal of and any premium and interest on this Debenture Note at the time and time, place and at the rate rate, and in the coin or currency and currency, herein prescribed. The Issuer shall have the right at any time, on one or more occasions, so long as an Event of Default has not occurred and is not continuing under the Indenture with respect to the Debentures, to extend any interest payment period on this Debenture for a period not to exceed 20 consecutive quarterly interest payment periods and, as a consequence, the quarterly interest payment on the Debentures would be deferred (but would continue to accrue with interest thereon compounded quarterly at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) during any such Deferral Period (as defined in the Indenture). At the end of each Deferral Period, the Issuer shall pay all interest then accrued and unpaid (compounded quarterly, at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) to the persons in whose name the Debentures are registered on the Record Date immediately preceding the Interest Payment Date at the end of such Deferral Period. In the event the Issuer exercises this right, the Issuer shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its Capital Stock (as defined in the Indenture) or make any guarantee payments with respect to the foregoing during such Deferral Period, other than redemptions of any series of Capital Stock of the Issuer pursuant to the terms of any sinking fund provisions with respect thereto. In addition, during any Deferral Period, the Issuer may not (i) make any distributions, loans or guarantees for the benefit of, (ii) purchase, defease, redeem or otherwise acquire or retire for value any securities of or (iii) make any other investment in any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer, for the purpose of, or to enable the payment of, directly or indirectly, dividends on any equity securities of Fund American Enterprises, Inc. and its successors or assigns. During any Deferral Period, the Issuer may continue to extend the interest payment period by extending the Deferral Period, on one or more occasions; provided that such Deferral Period, as extended, must end on an Interest Payment Date and in no event shall the aggregate Deferral Period, as extended, exceed 20 consecutive quarterly interest payment periods or extend beyond the maturity of the Debentures or any date on which any of the Debentures are fixed for redemption. No interest shall be due and payable on the Debentures during a Deferral Period except at the end thereof. The Issuer shall give the Trustee and the registered holders of Debentures notice (with the Trustee to receive notice at least three days prior to such Holders) of its election to defer interest payments or to extend the Deferral Period ten Business Days prior to the earlier of (i) the next scheduled quarterly Interest Payment Date or (ii) the date the Issuer is required to give notice of the record date of such related interest payment to the New York Stock Exchange or other applicable self-regulatory organization or to the holders of the Debentures, but in any event not less than two Business Days prior to such record date. • As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Debenture Note is registrable in the Security Register of the IssuerRegister, upon surrender of this Debenture Note for registration of transfer at the office or agency of the Issuer Company in any place where the principal of and any interest on this Debenture Note are payable or at such other offices or agencies as the Issuer may designatepayable, duly endorsed by by, or accompanied by a written instrument or instruments of transfer in form satisfactory to the Issuer Company and the Security Registrar or any transfer agent duly executed by by, the registered holder Holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Debentures Notes of this series and of like tenor, of authorized denominations and for the same aggregate principal amount amount, will be issued to the designated transferee or transferees. No service charge will be made for any such transfer, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation thereto. Prior to due presentment for registration of transfer of this Debenture, the Issuer, the Trustee, any paying agent and any Debenture Registrar may deem and treat the registered holder hereof as the absolute owner hereof (whether or not this Debenture shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Debenture Registrar) for the purpose of receiving payment of or on account of the principal hereof and interest due hereon and for all other purposes, and neither the Issuer nor the Trustee nor any paying agent nor any Debenture Registrar shall be affected by any notice to the contrary. • The Debentures of this series are issuable only in fully registered form without coupons in denominations of $25 and any integral multiple thereof. Debentures of this series so issued Notes are issuable only in registered form without coupons in denominations of $25 1,000 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Debentures of this series the Notes are exchangeable for a like aggregate principal amount of Debentures Notes and of this series like tenor of a different authorized denomination, as requested by the registered holder Holder surrendering the same. As set forth in• No service charge shall be made for any such registration of transfer or exchange, and subject but the Company may require payment of a sum sufficient to the provisions ofcover any tax or other governmental charge payable in connection therewith. • Prior to due presentment of this Note for registration of transfer, the IndentureCompany, no registered owner of any Debenture will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless (i) such registered owner shall have previously given to the Trustee written notice of a continuing Event of Default with respect to the Debentures of this series, (ii) the registered owners of not less than 25% in principal amount and any agent of the outstanding Debentures of all affected series then Outstanding shall have made written request, and offered reasonable indemnity, to Company or Trustee may treat the Trustee to institute such proceeding Person in whose name the Note is registered as trustee, (iii) the Trustee shall have failed to institute such proceeding within 60 days and (iv) the Trustee shall not have received from the registered owners of a majority in principal amount of the outstanding Debentures of this series a direction inconsistent with such request within such 60-day period; provided, however, that such limitations do not apply to a suit instituted by a registered owner hereof for all purposes, whether or not this Note be overdue, and neither the enforcement of payment of Company, the principal of or Trustee nor any interest on this Debenture on or after such agent shall be affected by notice to the respective due dates expressed herein, subject to deferral as set forth hereincontrary. • All defined terms used in this Debenture which Note that are defined in the Indenture shall have the meanings assigned to them in the Indenture. FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto ------------------------------------------------------------------------------- (Please insert Social Security or other number of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) the within Debenture and all rights thereunder, hereby irrevocably constituting and appointing such person attorneys to transfer the within Debenture on the books of the Issuer, with full power of substitution in the premises. Dated: _____________________ ___________________________________.

of the Original Indenture. The Debenture shall not be redeemed by the Issuer prior to April 30, 1999. Subject to Article 13 obligations of the Original Indenture, on or after May 1, 1999, the Issuer shall have the right Company to redeem this Debenture at the option of the Issuer, without premium or penalty, in whole or in part, at a redemption price equal to 100% of the principal amount redeemed plus the accrued and unpaid interest thereon to the date fixed for redemption. Any redemption pursuant to this paragraph will be made upon not less than 30 nor more than 60 days notice to the Trustee and Holders of the Debentures (with the Trustee to be notified at least three days prior to notice to such Holders). If the Debentures are only partially redeemed by the Issuer, the notes will be redeemed pro rata or by lot or by any other method utilized by the Trustee; provided that if at the time of redemption, the Debentures are registered as a Global Debenture, the Depositary shall determine by lot the principal amount of such Debentures held by each Debenture holder to be redeemed. In the event of redemption of this Debenture in part only, a new Debenture or Debentures of this series for the unredeemed portion hereof will be issued in the name of the registered holder hereof upon the cancellation hereof. In case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, pay the principal of all and interest on the Notes when due as herein prescribed are absolute and unconditional and no provision of this Note or the Indenture shall alter or impair such obligations. The Notes are subject to and have the benefits of the Debentures may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject Collateral Documents pursuant to the conditions provided in the Indenture. The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Debenture upon compliance by the Issuer with certain conditions set forth therein. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the registered holders of not less than a majority in aggregate principal amount of the outstanding Debentures of all series affected at the time, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or of modifying in any manner which the rights of the registered holders parties in respect of the Debentures; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Debentures of any series, or reduce the principal amount thereof, or reduce the rate of or extend the time of payment of interest thereon (except that a valid extension of an interest payment period Collateral will be exercised by the Issuer Trustee in accordance with the terms of any indenture supplemental heretoCollateral Documents. The Indenture permits, shall not constitute an extension of interest for this purpose)with certain exceptions, or reduce any amount payable on redemption thereofas therein provided, or make the principal amendment thereof (including any amount in respect of original issue discount) or interest thereon payable in any coin or currency other than that provided herein or in accordance with and the terms hereof, or reduce the amount modification of the principal of an Original Issue Discount Security that would be due rights and payable upon an acceleration obligations of the maturity thereof pursuant to Section 5.1 Company and the rights of the Original Indenture or Holders under the amount thereof provable in bankruptcy pursuant to Section 5.2 of the Original Indenture, or alter the provisions of Section 11.11 or 11.12 of the Original Indenture or impair or affect the right of any Securityholder to institute suit for the payment thereof or, if the Securities provide therefor, any right of repayment at the option of the Securityholder, or modify any provisions of the Indenture relating to the subordination of each Debenture in a manner adverse to such Holder, in each case without the consent of the registered holder of each Debenture so affected or (ii) reduce the aforesaid percentage of Debentures, the registered holders of which are required to consent to any such supplemental indenture, without the consent of the registered holders of each Debenture then outstanding and affected thereby. The Indenture also contains provisions permitting (i) the registered holders Holders of a majority specified percentages in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, Notes to waive compliance by the Issuer Company with certain provisions of the Indenture and (ii) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive certain past defaults under the Indenture and their consequences. Any Act (as such consent or waiver by the registered holder of this Debenture (unless revoked as provided term is defined in the Indenture) ), including, but not limited to, such a consent, waiver or direction by the Holder of this Note shall be conclusive and binding upon such registered holder the Holder and upon all future registered holders Holders of American Ref-Fuel Company Supplemental Indenture this Note and owners the Holder of this Debenture and of any Debenture every Note issued in exchange upon the transfer hereof or the exchange herefor or in place lieu hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver Act is made upon this DebentureNote. No reference herein This Note is one of the series designated on the face hereof, initially limited to $275,000,000 in aggregate principal amount as provided in the First Supplemental Indenture. This Note and all Notes issued or to be issued in a series created under the First Supplemental Indenture are redeemable in whole or in part at the option of the Company in accordance with Section 5.1 of the Original Indenture, on not less than 30 nor more than 60 days’ notice, at a redemption price equal to the Indenture principal amount thereof plus unpaid and no accrued interest plus the Make-Whole Premium. The Notes are, under certain conditions, subject to mandatory redemption in whole or in part as set forth in Section 5.2 of the Original Indenture. Notice of any redemption of Notes will be given at least 30 days but not more than 60 days before the Redemption Date to each Holder at its address as it appears in the Security Register. Notes (or portions thereof as aforesaid) for the redemption of which provision of this Debenture or of is made in accordance with the Indenture shall alter or impair the obligation of the Issuer, which is absolute cease to bear interest from and unconditional, to pay the principal of and interest on this Debenture at the time and place and at the rate and in the coin or currency herein prescribedafter any Redemption Date. The Issuer shall have Indenture contains provisions for, upon compliance by the right at any time, on one or more occasions, so long as an Event of Default has not occurred and is not continuing under the Indenture Company with respect to the Debentures, to extend any interest payment period on this Debenture for a period not to exceed 20 consecutive quarterly interest payment periods and, as a consequence, the quarterly interest payment on the Debentures would be deferred (but would continue to accrue with interest thereon compounded quarterly at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) during any such Deferral Period (as defined certain conditions set forth in the Indenture). At the end of each Deferral Period, the Issuer shall pay all defeasance of (a) the entire indebtedness of this Note and (b) certain restrictive covenants and agreements. The unpaid portion of the Principal Amount, together with any interest then accrued and unpaid (compounded quarterlythereon and all other amounts due hereunder, at if any, may become due and payable upon the rate occurrence and continuation of interest on the Debenturesany Event of Default, except to the extent payment of such interest is prohibited by law) to the persons in whose name the Debentures are registered on the Record Date immediately preceding the Interest Payment Date at the end of such Deferral Period. In the event the Issuer exercises this right, the Issuer shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its Capital Stock (but only as defined provided in the Indenture) or make any guarantee payments with respect to the foregoing during such Deferral Period, other than redemptions . Definitive Certificated Notes are issuable only as registered Notes in minimum denominations of any series $250,000 and integral multiples of Capital Stock of the Issuer pursuant to the terms of any sinking fund provisions with respect thereto. In addition, during any Deferral Period, the Issuer may not (i) make any distributions, loans or guarantees for the benefit of, (ii) purchase, defease, redeem or otherwise acquire or retire for value any securities of or (iii) make any other investment $1,000 in any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer, for the purpose of, or to enable the payment of, directly or indirectly, dividends on any equity securities of Fund American Enterprises, Inc. and its successors or assigns. During any Deferral Period, the Issuer may continue to extend the interest payment period by extending the Deferral Period, on one or more occasions; provided that such Deferral Period, as extended, must end on an Interest Payment Date and in no event shall the aggregate Deferral Period, as extended, exceed 20 consecutive quarterly interest payment periods or extend beyond the maturity of the Debentures or any date on which any of the Debentures are fixed for redemption. No interest shall be due and payable on the Debentures during a Deferral Period except at the end excess thereof. The Issuer shall give the Trustee Global Notes are issuable only as registered Notes in minimum denominations of $ 100,000 and the registered holders any integral multiples of Debentures notice (with the Trustee to receive notice at least three days prior to such Holders) of its election to defer interest payments or to extend the Deferral Period ten Business Days prior to the earlier of (i) the next scheduled quarterly Interest Payment Date or (ii) the date the Issuer is required to give notice of the record date of such related interest payment to the New York Stock Exchange or other applicable self-regulatory organization or to the holders of the Debentures, but $1,000 in any event not less than two Business Days prior to such record dateexcess thereof. As provided in the Indenture in, and subject to certain limitations therein set forththe provisions of, the transfer of this Debenture is registrable in Indenture, Notes are exchangeable at the Security Register option of the Issuer, upon surrender of this Debenture Holder thereof for registration of transfer at the office or agency other Notes of the Issuer in any place where the principal same series, of and any interest on this Debenture are payable or at such other offices or agencies as the Issuer may designate, duly endorsed by or accompanied by a written instrument or instruments of transfer in form satisfactory to the Issuer and the Security Registrar or any transfer agent duly executed by the registered holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Debentures of this series denomination and of like tenor, of authorized denominations maturity, interest rate and for the same aggregate principal amount will amount, to be issued registered in the name of such Holder, upon surrender thereof by such Holder at any office or agency maintained for such purpose pursuant to the designated transferee or transfereesIndenture. No service charge will be made for required of any Holder participating in any such transfertransfer or exchange of Notes in respect of such transfer or exchange, but the Issuer Security Registrar may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation theretoconnection therewith. Prior to due presentment of this Note for registration of transfer of this Debenturetransfer, the Issuer, person in whose name this Note is registered shall be deemed to be the Trustee, any paying agent owner and any Debenture Registrar may deem and treat the registered holder hereof as the absolute owner hereof (whether or not this Debenture shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Debenture Registrar) for the purpose of receiving payment of or on account of the principal hereof and interest due hereon as herein provided and for all other purposes, and neither the Issuer nor the Trustee nor any paying agent nor any Debenture Registrar shall purposes whether or not this Note be affected by overdue regardless of any notice to anyone to the contrary. THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW THEREOF TO THE EXTENT THE American Ref-Fuel Company Supplemental Indenture APPLICATION OF SUCH PRINCIPLES WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION. American Ref-Fuel Company Supplemental Indenture ANNEX A TO 6.26% SENIOR NOTE DUE 2015 The Debentures following table sets forth the date of each semiannual installment of the aggregate principal to be paid on all Notes of this series are issuable only in fully registered form without coupons in denominations of $25 and any integral multiple thereof. Debentures of this series so issued are issuable only in registered form without coupons in denominations of $25 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forthon each such date: Principal Amount Principal Payment Dates Payable on Series A Notes December 3 1,2003 $ 16,000,000 June 30, Debentures of this series are exchangeable for a like aggregate principal amount of Debentures of this series of a different authorized denomination2004 5,700,000 December 31,2004 13,300,000 June 30, as requested by the registered holder surrendering the same. As set forth in2005 6,000,000 December 31,2005 14,000,000 June 30, and subject to the provisions of2006 8,400,000 December 31, the 2006 19,600,000 June 30, 2007 8,100,000 December 31,2007 18,900,000 June 30, 2008 10,500,000 December 31,2008 24,500,000 June 30, 2009 3,900,000 December 31,2009 9,100,000 June 30, 2010 1,200,000 December 31,2010 2,800,000 June 30, 2011 11,700,000 December 31,2011 27,300,000 June 30, 2012 5.400,000 December 31,2012 12,600,000 June 30, 2013 1,200,000 December 31,2013 2,800,000 June 30, 2014 7,800,000 December 31,2014 18,200,000 June 30, 2015 7,800,000 December 31,2015 18,200,000 TOTAL $ 275,000,000 American Ref-Fuel Company Supplemental Indenture, no registered owner of any Debenture will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless (i) such registered owner shall have previously given to the Trustee written notice of a continuing Event of Default with respect to the Debentures of this series, (ii) the registered owners of not less than 25% in principal amount of the outstanding Debentures of all affected series then Outstanding shall have made written request, and offered reasonable indemnity, to the Trustee to institute such proceeding as trustee, (iii) the Trustee shall have failed to institute such proceeding within 60 days and (iv) the Trustee shall not have received from the registered owners of a majority in principal amount of the outstanding Debentures of this series a direction inconsistent with such request within such 60-day period; provided, however, that such limitations do not apply to a suit instituted by a registered owner hereof for the enforcement of payment of the principal of or any interest on this Debenture on or after the respective due dates expressed herein, subject to deferral as set forth herein. All terms used in this Debenture which are defined in the Indenture shall have the meanings assigned to them in the Indenture. FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto ------------------------------------------------------------------------------- (Please insert Social Security or other number of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) the within Debenture and all rights thereunder, hereby irrevocably constituting and appointing such person attorneys to transfer the within Debenture on the books of the Issuer, with full power of substitution in the premises. Dated: _____________________ ___________________________________

of the Original Indenture. The Debenture shall not be redeemed by the Issuer prior to April 30, 1999. Subject to Article 13 Twelve of the Original Indenture, on or after May 1, 1999, the Issuer shall have the right to redeem this Debenture at the option of the Issuer, without premium or penalty, in whole or in part, at a redemption price equal to 100% of the principal amount redeemed plus the accrued and unpaid interest thereon to the date fixed for redemption. Any redemption pursuant to this paragraph will be made upon not less than 30 nor more than 60 days notice to the Trustee and Holders of the Debentures (with the Trustee to be notified at least three five days prior to notice to such Holders). If the Debentures are only partially redeemed by the Issuer, the notes Debentures will be redeemed pro rata or by lot or by any other method utilized by the Trustee; provided that if at the time of redemption, the Debentures are registered as a Global Debenture, the Depositary shall determine by lot the principal amount of such Debentures held by each Debenture holder to be redeemed. In the event of redemption of this Debenture in part only, a new Debenture or Debentures of this series for the unredeemed portion hereof will be issued in the name of the registered holder hereof upon the cancellation hereof. In case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, the principal of all of the Debentures may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Debenture upon compliance by the Issuer with certain conditions set forth therein. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the registered holders of not less than a majority in aggregate principal amount of the outstanding Debentures of all series affected at the time, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or of modifying in any manner the rights of the registered holders of the Debentures; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Debentures of any series, or reduce the principal amount thereof, or reduce the rate of or extend the time of payment of interest thereon (except that a valid extension of an interest payment period by the Issuer in accordance with the terms of any indenture supplemental hereto, shall not constitute an extension of interest for this purpose), or reduce any amount payable on redemption thereof, or make the principal thereof (including any amount in respect of original issue discount) or interest thereon payable in any coin or currency other than that provided herein or in accordance with the terms hereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof pursuant to Section 5.1 of the Original Indenture or the amount thereof provable in bankruptcy pursuant to Section 5.2 of the Original Indenture, or alter the provisions of Section 11.11 or 11.12 of the Original Indenture or impair or affect the right of any Securityholder to institute suit for the payment thereof or, if the Securities provide therefor, any right of repayment at the option of the Securityholder, or modify any provisions of the Indenture relating to the subordination of each Debenture in a manner adverse to such Holder, in each case without the consent of the registered holder of each Debenture so affected or (ii) reduce the aforesaid percentage of Debentures, the registered holders of which are required to consent to any such supplemental indenture, without the consent of the registered holders of each Debenture then outstanding and affected thereby. The Indenture also contains provisions permitting (i) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive compliance by the Issuer with certain provisions of the Indenture and (ii) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive certain past defaults under the Indenture and their consequences. Any such consent or waiver by the registered holder of this Debenture (unless revoked as provided in the Indenture) shall be conclusive and binding upon such registered holder and upon all future registered holders and owners of this Debenture and of any Debenture issued in exchange hereof or in place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Debenture. No reference herein to the Indenture and no provision of this Debenture or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Debenture at the time and place and at the rate and in the coin or currency herein prescribed. The Issuer shall have the right at any time, on one or more occasions, so long as an Event of Default has not occurred and is not continuing under the Indenture with respect to the Debentures, to extend any interest payment period on this Debenture for a period not to exceed 20 consecutive quarterly interest payment periods and, as a consequence, the quarterly interest payment on the Debentures would be deferred (but would continue to accrue with interest thereon compounded quarterly at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) during any such Deferral Period (as defined in the Indenture). At the end of each Deferral Period, the Issuer shall pay all interest then accrued and unpaid (compounded quarterly, at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) to the persons in whose name the Debentures are registered on the Record Date immediately preceding the Interest Payment Date at the end of such Deferral Period. In the event the Issuer exercises this right, the Issuer shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its Capital Stock (as defined in the Indenture) or make any guarantee payments with respect to the foregoing during such Deferral Period, other than redemptions of any series of Capital Stock of the Issuer pursuant to the terms of any sinking fund provisions with respect thereto. In addition, during any Deferral Period, the Issuer may not (i) make any distributions, loans or guarantees for the benefit of, (ii) purchase, defease, redeem or otherwise acquire or retire for value any securities of or (iii) make any other investment in any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer, for the purpose of, or to enable the payment of, directly or indirectly, dividends on any equity securities of Fund American Enterprises, Inc. and its successors or assigns. During any Deferral Period, the Issuer may continue to extend the interest payment period by extending the Deferral Period, on one or more occasions; provided that such Deferral Period, as extended, must end on an Interest Payment Date and in no event shall the aggregate Deferral Period, as extended, exceed 20 consecutive quarterly interest payment periods or extend beyond the maturity of the Debentures or any date on which any of the Debentures are fixed for redemption. No interest shall be due and payable on the Debentures during a Deferral Period except at the end thereof. The Issuer shall give the Trustee and the registered holders of Debentures notice (with the Trustee to receive notice at least three days prior to such Holders) of its election to defer interest payments or to extend the Deferral Period ten Business Days prior to the earlier of (i) the next scheduled quarterly Interest Payment Date or (ii) the date the Issuer is required to give notice of the record date of such related interest payment to the New York Stock Exchange or other applicable self-regulatory organization or to the holders of the Debentures, but in any event not less than two Business Days prior to such record date. As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Debenture is registrable in the Security Register of the Issuer, upon surrender of this Debenture for registration of transfer at the office or agency of the Issuer in any place where the principal of and any interest on this Debenture are payable or at such other offices or agencies as the Issuer may designate, duly endorsed by or accompanied by a written instrument or instruments of transfer in form satisfactory to the Issuer and the Security Registrar or any transfer agent duly executed by the registered holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Debentures of this series and of like tenor, of authorized denominations and for the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be made for any such transfer, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation thereto. Prior to due presentment for registration of transfer of this Debenture, the Issuer, the Trustee, any paying agent and any Debenture Registrar may deem and treat the registered holder hereof as the absolute owner hereof (whether or not this Debenture shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Debenture Registrar) for the purpose of receiving payment of or on account of the principal hereof and interest due hereon and for all other purposes, and neither the Issuer nor the Trustee nor any paying agent nor any Debenture Registrar shall be affected by any notice to the contrary. The Debentures of this series are issuable only in fully registered form without coupons in denominations of $25 and any integral multiple thereof. Debentures of this series so issued are issuable only in registered form without coupons in denominations of $25 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Debentures of this series are exchangeable for a like aggregate principal amount of Debentures of this series of a different authorized denomination, as requested by the registered holder surrendering the same. As set forth in, and subject to the provisions of, the Indenture, no registered owner of any Debenture will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless (i) such registered owner shall have previously given to the Trustee written notice of a continuing Event of Default with respect to the Debentures of this series, (ii) the registered owners of not less than 25% in principal amount of the outstanding Debentures of all affected series then Outstanding shall have made written request, and offered reasonable indemnity, to the Trustee to institute such proceeding as trustee, (iii) the Trustee shall have failed to institute such proceeding within 60 days and (iv) the Trustee shall not have received from the registered owners of a majority in principal amount of the outstanding Debentures of this series a direction inconsistent with such request within such 60-day period; provided, however, that such limitations do not apply to a suit instituted by a registered owner hereof for the enforcement of payment of the principal of or any interest on this Debenture on or after the respective due dates expressed herein, subject to deferral as set forth herein. All terms used in this Debenture which are defined in the Indenture shall have the meanings assigned to them in the Indenture. FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto ------------------------------------------------------------------------------- (Please insert Social Security or other number of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) the within Debenture and all rights thereunder, hereby irrevocably constituting and appointing such person attorneys to transfer the within Debenture on the books of the Issuer, with full power of substitution in the premises. Dated: _____________________ ___________________________________.

of the Original Indenture. The Debenture shall not be redeemed by the Issuer prior to April 30, 1999. Subject to Article 13 Twelve of the Original Indenture, on or after May 1, 1999, the Issuer shall have the right to redeem this Debenture at the option of the Issuer, without premium or penalty, in whole or in part, at a redemption price equal to 100% of the principal amount redeemed plus the accrued and unpaid interest thereon to the date fixed for redemption. Any redemption pursuant to this paragraph will be made upon not less than 30 nor more than 60 days notice to the Trustee and Holders of the Debentures (with the Trustee to be notified at least three five days prior to notice to such Holders). If the Debentures are only partially redeemed by the Issuer, the notes Debentures will be redeemed pro rata or by lot or by any other method utilized by the Trustee; provided that if at the time of redemption, the Debentures are registered as a Global Debenture, the Depositary shall determine by lot the principal amount of such Debentures held by each Debenture holder to be redeemed. In the event of redemption of this Debenture in part only, a new Debenture or Debentures of this series for the unredeemed portion hereof will be issued in the name of the registered holder hereof upon the cancellation hereof. In case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, the principal of all of the Debentures may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Debenture upon compliance by the Issuer with certain conditions set forth therein. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the registered holders of not less than a majority in aggregate principal amount of the outstanding Debentures of all series affected at the time, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or of modifying in any manner the rights of the registered holders of the Debentures; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Debentures of any series, or reduce the principal amount thereof, or reduce the rate of or extend the time of payment of interest thereon (except that a valid extension of an interest payment period by the Issuer in accordance with the terms of any indenture supplemental hereto, shall not constitute an extension of interest for this purpose), or reduce any amount payable on redemption thereof, or make the principal thereof (including any amount in respect of original issue discount) or interest thereon payable in any coin or currency other than that provided herein or in accordance with the terms hereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof pursuant to Section 5.1 of the Original Indenture or the amount thereof provable in bankruptcy pursuant to Section 5.2 of the Original Indenture, or alter the provisions of Section 11.11 or 11.12 of the Original Indenture or impair or affect the right of any Securityholder to institute suit for the payment thereof or, if the Securities provide therefor, any right of repayment at the option of the Securityholder, or modify any provisions of the Indenture relating to the subordination of each Debenture in a manner adverse to such Holder, in each case without the consent of the registered holder of each Debenture so affected or (ii) reduce the aforesaid percentage of Debentures, the registered holders of which are required to consent to any such supplemental indenture, without the consent of the registered holders of each Debenture then outstanding and affected thereby. The Indenture also contains provisions permitting (i) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive compliance by the Issuer with certain provisions of the Indenture and (ii) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive certain past defaults under the Indenture and their consequences. Any such consent or waiver by the registered holder of this Debenture (unless revoked as provided in the Indenture) shall be conclusive and binding upon such registered holder and upon all future registered holders and owners of this Debenture and of any Debenture issued in exchange hereof or in place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Debenture. No reference herein to the Indenture and no provision of this Debenture or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Debenture at the time and place and at the rate and in the coin or currency herein prescribed. The Issuer shall have the right at any time, on one or more occasions, so long as an Event of Default has not occurred and is not continuing under the Indenture with respect to the Debentures, to extend any interest payment period on this Debenture for a period not to exceed 20 consecutive quarterly interest payment periods and, as a consequence, the quarterly interest payment on the Debentures would be deferred (but would continue to accrue with interest thereon compounded quarterly at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) during any such Deferral Period (as defined in the Indenture). At the end of each Deferral Period, the Issuer shall pay all interest then accrued and unpaid (compounded quarterly, at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) to the persons in whose name the Debentures are registered on the Record Date immediately preceding the Interest Payment Date at the end of such Deferral Period. In the event the Issuer exercises this right, the Issuer shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its Capital Stock (as defined in the Indenture) or make any guarantee payments with respect to the foregoing during such Deferral Period, other than redemptions of any series of Capital Stock of the Issuer pursuant to the terms of any sinking fund provisions with respect thereto. In addition, during any Deferral Period, the Issuer may not (i) make any distributions, loans or guarantees for the benefit of, (ii) purchase, defease, redeem or otherwise acquire or retire for value any securities of of, or (iii) make any other investment in any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer, for the purpose of, or to enable the payment of, directly or indirectly, dividends on any equity securities of Fund American Enterprises, Inc. and its successors or assigns. During any Deferral Period, the Issuer may continue to extend the interest payment period by extending the Deferral Period, on one or more occasions; provided that such Deferral Period, as extended, must end on an Interest Payment Date and in no event shall the aggregate Deferral Period, as extended, exceed 20 consecutive quarterly interest payment periods or extend beyond the maturity of the Debentures or any date on which any of the Debentures are fixed for redemption. No interest shall be due and payable on the Debentures during a Deferral Period except at the end thereof. The Issuer shall give the Trustee and the registered holders of Debentures notice (with the Trustee to receive notice at least three days prior to such Holders) of its election to defer interest payments or to extend the Deferral Period ten Business Days prior to the earlier of (i) the next scheduled quarterly Interest Payment Date or (ii) the date the Issuer is required to give notice of the record date of such related interest payment to the New York Stock Exchange or other applicable self-regulatory organization or to the holders of the Debentures, but in any event not less than two Business Days prior to such record date. As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Debenture is registrable in the Security Register of the Issuer, upon surrender of this Debenture for registration of transfer at the office or agency of the Issuer in any place where the principal of and any interest on this Debenture are payable or at such other offices or agencies as the Issuer may designate, duly endorsed by or accompanied by a written instrument or instruments of transfer in form satisfactory to the Issuer and the Security Registrar security registrar or any transfer agent duly executed by the registered holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Debentures of this series and of like tenor, of authorized denominations and for the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be made for any such transfer, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation thereto. Prior to due presentment for registration of transfer of this Debenture, the Issuer, the Trustee, any paying agent and any Debenture Registrar security registrar may deem and treat the registered holder hereof as the absolute owner hereof (whether or not this Debenture shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Debenture Registrarsecurity registrar) for the purpose of receiving payment of or on account of the principal hereof and interest due hereon and for all other purposes, and neither the Issuer nor the Trustee nor any paying agent nor any Debenture Registrar security registrar shall be affected by any notice to the contrary. The Debentures of this series are issuable only in fully registered form without coupons in denominations of $25 and any integral multiple thereof. Debentures of this series so issued are issuable only in registered form without coupons in denominations of $25 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Debentures of this series are exchangeable for a like aggregate principal amount of Debentures of this series of a different authorized denomination, as requested by the registered holder surrendering the same. As set forth in, and subject to the provisions of, the Indenture, no registered owner of any Debenture will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless (i) such registered owner shall have previously given to the Trustee written notice of a continuing Event of Default with respect to the Debentures of this series, (ii) the registered owners of not less than 25% in principal amount of the outstanding Debentures of all affected series then Outstanding shall have made written request, and offered reasonable indemnity, to the Trustee to institute such proceeding as trustee, (iii) the Trustee shall have failed to institute such proceeding within 60 days and (iv) the Trustee shall not have received from the registered owners of a majority in principal amount of the outstanding Debentures of this series a direction inconsistent with such request within such 60-day period; provided, however, that such limitations do not apply to a suit instituted by a registered owner hereof for the enforcement of payment of the principal of or any interest on this Debenture on or after the respective due dates expressed herein, subject to deferral as set forth herein. All terms used in this Debenture which are defined in the Indenture shall have the meanings assigned to them in the Indenture. FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto ------------------------------------------------------------------------------- (Please insert Social Security or other number of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) the within Debenture and all rights thereunder, hereby irrevocably constituting and appointing such person attorneys to transfer the within Debenture on the books of the Issuer, with full power of substitution in the premises. Dated: _____________________ ___________________________________.

of the Original Indenture. The Debenture shall not be redeemed by the Issuer prior to April 30, 1999. Subject to Article 13 obligations of the Original Indenture, on or after May 1, 1999, the Issuer shall have the right Company to redeem this Debenture at the option of the Issuer, without premium or penalty, in whole or in part, at a redemption price equal to 100% of the principal amount redeemed plus the accrued and unpaid interest thereon to the date fixed for redemption. Any redemption pursuant to this paragraph will be made upon not less than 30 nor more than 60 days notice to the Trustee and Holders of the Debentures (with the Trustee to be notified at least three days prior to notice to such Holders). If the Debentures are only partially redeemed by the Issuer, the notes will be redeemed pro rata or by lot or by any other method utilized by the Trustee; provided that if at the time of redemption, the Debentures are registered as a Global Debenture, the Depositary shall determine by lot the principal amount of such Debentures held by each Debenture holder to be redeemed. In the event of redemption of this Debenture in part only, a new Debenture or Debentures of this series for the unredeemed portion hereof will be issued in the name of the registered holder hereof upon the cancellation hereof. In case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, pay the principal of all and interest on the Notes when due as herein prescribed are absolute and unconditional and no provision of this Note or the Indenture shall alter or impair such obligations. The Notes are subject to and have the benefits of the Debentures may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject Collateral Documents pursuant to the conditions provided in the Indenture. The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Debenture upon compliance by the Issuer with certain conditions set forth therein. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the registered holders of not less than a majority in aggregate principal amount of the outstanding Debentures of all series affected at the time, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or of modifying in any manner which the rights of the registered holders parties in respect of the Debentures; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Debentures of any series, or reduce the principal amount thereof, or reduce the rate of or extend the time of payment of interest thereon (except that a valid extension of an interest payment period Collateral will be exercised by the Issuer Trustee in accordance with the terms of any indenture supplemental heretoCollateral Documents. The Indenture permits, shall not constitute an extension of interest for this purpose)with certain exceptions, or reduce any amount payable on redemption thereofas therein provided, or make the principal amendment thereof (including any amount in respect of original issue discount) or interest thereon payable in any coin or currency other than that provided herein or in accordance with and the terms hereof, or reduce the amount modification of the principal of an Original Issue Discount Security that would be due rights and payable upon an acceleration obligations of the maturity thereof pursuant to Section 5.1 Company and the rights of the Original Indenture or Holders under the amount thereof provable in bankruptcy pursuant to Section 5.2 of the Original Indenture, or alter the provisions of Section 11.11 or 11.12 of the Original Indenture or impair or affect the right of any Securityholder to institute suit for the payment thereof or, if the Securities provide therefor, any right of repayment at the option of the Securityholder, or modify any provisions of the Indenture relating to the subordination of each Debenture in a manner adverse to such Holder, in each case without the consent of the registered holder of each Debenture so affected or (ii) reduce the aforesaid percentage of Debentures, the registered holders of which are required to consent to any such supplemental indenture, without the consent of the registered holders of each Debenture then outstanding and affected thereby. The Indenture also contains provisions permitting (i) the registered holders Holders of a majority specified percentages in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, Notes to waive compliance by the Issuer Company with certain provisions of the Indenture and (ii) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive certain past defaults under the Indenture and their consequences. Any Act (as such consent or waiver by the registered holder of this Debenture (unless revoked as provided term is defined in the Indenture) ), including, but not limited to, such a consent, waiver or direction by the Holder of this Note shall be conclusive and binding upon such registered holder the Holder and upon all future registered holders Holders of American Ref-Fuel Company Supplemental Indenture this Note and owners the Holder of this Debenture and of any Debenture every Note issued in exchange upon the transfer hereof or the exchange herefor or in place lieu hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver Act is made upon this DebentureNote. No reference herein This Note is one of the series designated on the face hereof, limited to $275,000,000 in aggregate principal amount as provided in the First Supplemental Indenture. This Note and all Notes issued or to be issued in a series created under the First Supplemental Indenture are redeemable in whole or in part at the option of the Company in accordance with Section 5.1 of the Original Indenture, on not less than 30 nor more than 60 days’ notice, at a redemption price equal to the Indenture principal amount thereof plus unpaid and no accrued interest plus the Make-Whole Premium. The Notes are, under certain conditions, subject to mandatory redemption in whole or in part as set forth in Section 5.2 of the Original Indenture. Notice of any redemption of Notes will be given at least 30 days but not more than 60 days before the Redemption Date to each Holder at its address as it appears in the Security Register. Notes (or portions thereof as aforesaid) for the redemption of which provision of this Debenture or of is made in accordance with the Indenture shall alter or impair the obligation of the Issuer, which is absolute cease to bear interest from and unconditional, to pay the principal of and interest on this Debenture at the time and place and at the rate and in the coin or currency herein prescribedafter any Redemption Date. The Issuer shall have Indenture contains provisions for, upon compliance by the right at any time, on one or more occasions, so long as an Event of Default has not occurred and is not continuing under the Indenture Company with respect to the Debentures, to extend any interest payment period on this Debenture for a period not to exceed 20 consecutive quarterly interest payment periods and, as a consequence, the quarterly interest payment on the Debentures would be deferred (but would continue to accrue with interest thereon compounded quarterly at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) during any such Deferral Period (as defined certain conditions set forth in the Indenture). At the end of each Deferral Period, the Issuer shall pay all defeasance of (a) the entire indebtedness of this Note and (b) certain restrictive covenants and agreements. The unpaid portion of the Principal Amount together with any interest then accrued and unpaid (compounded quarterlythereon and all other amounts due hereunder, at if any, may become due and payable upon the rate occurrence and continuation of interest on the Debenturesany Event of Default, except to the extent payment of such interest is prohibited by law) to the persons in whose name the Debentures are registered on the Record Date immediately preceding the Interest Payment Date at the end of such Deferral Period. In the event the Issuer exercises this right, the Issuer shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its Capital Stock (but only as defined provided in the Indenture) or make any guarantee payments with respect to the foregoing during such Deferral Period, other than redemptions . Definitive Certificated Notes are issuable only as registered Notes in minimum denominations of any series $250,000 and integral multiples of Capital Stock of the Issuer pursuant to the terms of any sinking fund provisions with respect thereto. In addition, during any Deferral Period, the Issuer may not (i) make any distributions, loans or guarantees for the benefit of, (ii) purchase, defease, redeem or otherwise acquire or retire for value any securities of or (iii) make any other investment $1,000 in any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer, for the purpose of, or to enable the payment of, directly or indirectly, dividends on any equity securities of Fund American Enterprises, Inc. and its successors or assigns. During any Deferral Period, the Issuer may continue to extend the interest payment period by extending the Deferral Period, on one or more occasions; provided that such Deferral Period, as extended, must end on an Interest Payment Date and in no event shall the aggregate Deferral Period, as extended, exceed 20 consecutive quarterly interest payment periods or extend beyond the maturity of the Debentures or any date on which any of the Debentures are fixed for redemption. No interest shall be due and payable on the Debentures during a Deferral Period except at the end excess thereof. The Issuer shall give the Trustee Global Notes are issuable only as registered Notes in minimum denominations of $100,000 and the registered holders any integral multiples of Debentures notice (with the Trustee to receive notice at least three days prior to such Holders) of its election to defer interest payments or to extend the Deferral Period ten Business Days prior to the earlier of (i) the next scheduled quarterly Interest Payment Date or (ii) the date the Issuer is required to give notice of the record date of such related interest payment to the New York Stock Exchange or other applicable self-regulatory organization or to the holders of the Debentures, but $1,000 in any event not less than two Business Days prior to such record dateexcess thereof. As provided in the Indenture in, and subject to certain limitations therein set forththe provisions of, the transfer of this Debenture is registrable in Indenture, Notes are exchangeable at the Security Register option of the Issuer, upon surrender of this Debenture Holder thereof for registration of transfer at the office or agency other Notes of the Issuer in any place where the principal same series, of and any interest on this Debenture are payable or at such other offices or agencies as the Issuer may designate, duly endorsed by or accompanied by a written instrument or instruments of transfer in form satisfactory to the Issuer and the Security Registrar or any transfer agent duly executed by the registered holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Debentures of this series denomination and of like tenor, of authorized denominations maturity, interest rate and for the same aggregate principal amount will amount, to be issued registered in the name of such Holder, upon surrender thereof by such Holder at any office or agency maintained for such purpose pursuant to the designated transferee or transfereesIndenture. No service charge will be made for required of any Holder participating in any such transfertransfer or exchange of Notes in respect of such transfer or exchange, but the Issuer Security Registrar may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation theretoconnection therewith. Prior to due presentment of this Note for registration of transfer of this Debenturetransfer, the Issuer, person in whose name this Note is registered shall he deemed to be the Trustee, any paying agent owner and any Debenture Registrar may deem and treat the registered holder hereof as the absolute owner hereof (whether or not this Debenture shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Debenture Registrar) for the purpose of receiving payment of or on account of the principal hereof and interest due hereon as herein provided and for all other purposes, and neither the Issuer nor the Trustee nor any paying agent nor any Debenture Registrar shall purposes whether or not this Note be affected by overdue regardless of any notice to anyone to the contrary. THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW THEREOF TO THE EXTENT THE American Ref-Fuel Company Supplemental Indenture APPLICATION OF SUCH PRINCIPLES WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION. American Ref-Fuel Company Supplemental Indenture ABBREVIATIONS The Debentures following abbreviations when used in the inscription on the face of this series are issuable only instrument shall be construed as though they were written out in fully registered form without coupons full according to applicable laws or regulations: TEN COM — as tenants in denominations of $25 and any integral multiple thereof. Debentures of this series so issued are issuable only in registered form without coupons in denominations of $25 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Debentures of this series are exchangeable for a like aggregate principal amount of Debentures of this series of a different authorized denomination, common TEN ENT — as requested tenants by the registered holder surrendering the same. As set forth in, entireties JT TEN — as joint tenants with right of survivorship and subject not as tenants in common UNIF GIFT MIN ACT (Cust) (Minor) under Uniform Gift to the provisions of, the Indenture, no registered owner of any Debenture will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless (i) such registered owner shall have previously given to the Trustee written notice of a continuing Event of Default with respect to the Debentures of this series, (ii) the registered owners of not less than 25% in principal amount of the outstanding Debentures of all affected series then Outstanding shall have made written request, and offered reasonable indemnity, to the Trustee to institute such proceeding as trustee, (iii) the Trustee shall have failed to institute such proceeding within 60 days and (iv) the Trustee shall not have received from the registered owners of a majority in principal amount of the outstanding Debentures of this series a direction inconsistent with such request within such 60-day period; provided, however, that such limitations do not apply to a suit instituted by a registered owner hereof for the enforcement of payment of the principal of or any interest on this Debenture on or after the respective due dates expressed herein, subject to deferral as set forth herein. All terms used in this Debenture which are defined in the Indenture shall have the meanings assigned to them in the Indenture. FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto ------------------------------------------------------------------------------- (Please insert Social Security or other number of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) the within Debenture and all rights thereunder, hereby irrevocably constituting and appointing such person attorneys to transfer the within Debenture on the books of the Issuer, with full power of substitution in the premises. Dated: _____________________ ___________________________________Minors Act

of the Original Indenture. The Debenture shall not be redeemed by the Issuer prior to April 30, 1999. Subject to Article 13 Twelve of the Original Indenture, on or after May 1, 1999, the Issuer shall have the right to redeem this Debenture at the option of the Issuer, without premium or penalty, in whole or in part, at a redemption price equal to 100% of the principal amount redeemed plus the accrued and unpaid interest thereon to the date fixed for redemption. Any redemption pursuant to this paragraph will be made upon not less than 30 nor more than 60 days notice to the Trustee and Holders of the Debentures (with the Trustee to be notified at least three five days prior to notice to such Holders). If the Debentures are only partially redeemed by the Issuer, the notes Debentures will be redeemed pro rata or by lot or by any other method utilized by the Trustee; provided that if at the time of redemption, the Debentures are registered as a Global Debenture, the Depositary shall determine by lot the principal amount of such Debentures held by each Debenture holder Debentureholder to be redeemed. In the event of redemption of this Debenture in part only, a new Debenture or Debentures of this series for the unredeemed portion hereof will be issued in the name of the registered holder hereof upon the cancellation hereof. In case an Event of Default, as defined in the Indenture, shall have occurred and be continuing, the principal of all of the Debentures may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Debenture upon compliance by the Issuer with certain conditions set forth therein. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the registered holders of not less than a majority in aggregate principal amount of the outstanding Debentures of all series affected at the time, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or of modifying in any manner the rights of the registered holders of the Debentures; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Debentures of any series, or reduce the principal amount thereof, or reduce the rate of or extend the time of payment of interest thereon (except that a valid extension of an interest payment period by the Issuer in accordance with the terms of any indenture supplemental hereto, shall not constitute an extension of interest for this purpose), or reduce any amount payable on redemption thereof, or make the principal thereof (including any amount in respect of original issue discount) or interest thereon payable in any coin or currency other than that provided herein or in accordance with the terms hereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon an acceleration of the maturity thereof pursuant to Section 5.1 of the Original Indenture or the amount thereof provable in bankruptcy pursuant to Section 5.2 of the Original Indenture, or alter the provisions of Section 11.11 or 11.12 of the Original Indenture or impair or affect the right of any Securityholder to institute suit for the payment thereof or, if the Securities provide therefor, any right of repayment at the option of the Securityholder, or modify any provisions of the Indenture relating to the subordination of each Debenture in a manner adverse to such Holder, in each case without the consent of the registered holder of each Debenture so affected or (ii) reduce the aforesaid percentage of Debentures, the registered holders of which are required to consent to any such supplemental indenture, without the consent of the registered holders of each Debenture then outstanding and affected thereby. The Indenture also contains provisions permitting (i) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive compliance by the Issuer with certain provisions of the Indenture and (ii) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive certain past defaults under the Indenture and their consequences. Any such consent or waiver by the registered holder of this Debenture (unless revoked as provided in the Indenture) shall be conclusive and binding upon such registered holder and upon all future registered holders and owners of this Debenture and of any Debenture issued in exchange hereof or in place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any notation of such consent or waiver is made upon this Debenture. No reference herein to the Indenture and no provision of this Debenture or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Debenture at the time and place and at the rate and in the coin or currency herein prescribed. The Issuer shall have the right at any time, on one or more occasions, so long as an Event of Default has not occurred and is not continuing under the Indenture with respect to the Debentures, to extend any interest payment period on this Debenture for a period not to exceed 20 consecutive quarterly interest payment periods and, as a consequence, the quarterly interest payment on the Debentures would be deferred (but would continue to accrue with interest thereon compounded quarterly at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) during any such Deferral Period (as defined in the Indenture). At the end of each Deferral Period, the Issuer shall pay all interest then accrued and unpaid (compounded quarterly, at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) to the persons in whose name the Debentures are registered on the Record Date immediately preceding the Interest Payment Date at the end of such Deferral Period. In the event the Issuer exercises this right, the Issuer shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its Capital Stock (as defined in the Indenture) or make any guarantee payments with respect to the foregoing during such Deferral Period, other than redemptions of any series of Capital Stock of the Issuer pursuant to the terms of any sinking fund provisions with respect thereto. In addition, during any Deferral Period, the Issuer may not (i) make any distributions, loans or guarantees for the benefit of, (ii) purchase, defease, redeem or otherwise acquire or retire for value any securities of of, or (iii) make any other investment in any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer, for the purpose of, or to enable the payment of, directly or indirectly, dividends on any equity securities of Fund American Enterprises, Inc. and its successors or assigns. During any Deferral Period, the Issuer may continue to extend the interest payment period by extending the Deferral Period, on one or more occasions; provided that such Deferral Period, as extended, must end on an Interest Payment Date and in no event shall the aggregate Deferral Period, as extended, exceed 20 consecutive quarterly interest payment periods or extend beyond the maturity of the Debentures or any date on which any of the Debentures are fixed for redemption. No interest shall be due and payable on the Debentures during a Deferral Period except at the end thereof. The Issuer shall give the Trustee and the registered holders of Debentures notice (with the Trustee to receive notice at least three days prior to such Holders) of its election to defer interest payments or to extend the Deferral Period ten Business Days prior to the earlier of (i) the next scheduled quarterly Interest Payment Date or (ii) the date the Issuer is required to give notice of the record date of such related interest payment to the New York Stock Exchange or other applicable self-regulatory organization or to the holders of the Debentures, but in any event not less than two Business Days prior to such record date. As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Debenture is registrable in the Security Register of the Issuer, upon surrender of this Debenture for registration of transfer at the office or agency of the Issuer in any place where the principal of and any interest on this Debenture are payable or at such other offices or agencies as the Issuer may designate, duly endorsed by or accompanied by a written instrument or instruments of transfer in form satisfactory to the Issuer and the Security Registrar security registrar or any transfer agent duly executed by the registered holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Debentures of this series and of like tenor, of authorized denominations and for the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be made for any such transfer, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation thereto. Prior to due presentment for registration of transfer of this Debenture, the Issuer, the Trustee, any paying agent and any Debenture Registrar security registrar may deem and treat the registered holder hereof as the absolute owner hereof (whether or not this Debenture shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Debenture Registrarsecurity registrar) for the purpose of receiving payment of or on account of the principal hereof and interest due hereon and for all other purposes, and neither the Issuer nor the Trustee nor any paying agent nor any Debenture Registrar security registrar shall be affected by any notice to the contrary. The Debentures of this series are issuable only in fully registered form without coupons in denominations of $25 and any integral multiple thereof. This Registered Global Security is exchangeable for Debentures in definitive form only under certain limited circumstances set forth in the Indenture. Debentures of this series so issued are issuable only in registered form without coupons in denominations of $25 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Debentures of this series are exchangeable for a like aggregate principal amount of Debentures of this series of a different authorized denomination, as requested by the registered holder surrendering the same. As set forth in, and subject to the provisions of, the Indenture, no registered owner of any Debenture will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless (i) such registered owner shall have previously given to the Trustee written notice of a continuing Event of Default with respect to the Debentures of this series, (ii) the registered owners of not less than 25% in principal amount of the outstanding Debentures of all affected series then Outstanding shall have made written request, and offered reasonable indemnity, to the Trustee to institute such proceeding as trustee, (iii) the Trustee shall have failed to institute such proceeding within 60 days and (iv) the Trustee shall not have received from the registered owners of a majority in principal amount of the outstanding Debentures of this series a direction inconsistent with such request within such 60-day period; provided, however, that such limitations do not apply to a suit instituted by a registered owner hereof for the enforcement of payment of the principal of or any interest on this Debenture on or after the respective due dates expressed herein, subject to deferral as set forth herein. All terms used in this Debenture which are defined in the Indenture shall have the meanings assigned to them in the Indenture. FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto ------------------------------------------------------------------------------- (Please insert Social Security or other number of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code code, of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code code, of assignee) the within Debenture and all rights thereunder, hereby irrevocably constituting and appointing such person attorneys to transfer the within Debenture on the books of the Issuer, with full power of substitution in the premises. Dated: _____________________ ___________________________________

of the Original Indenture. The Debenture 1996 Series A Bonds shall be issuable in fully registered form without coupons and in denominations necessary to issue Bonds in the required principal amounts. Each 1996 Series A Bond shall be dated the date of its authentication. The 1996 Series A Bonds shall mature on February 28, 1997. Except in the event that the principal of the 1996 Series A Bonds shall not be redeemed paid at maturity or shall be declared due and payable in the manner and with the effect provided in Section 9.02 of the Indenture, the 1996 Series A Bonds shall not bear interest. In the event that the principal of the 1996 Series A Bonds shall not be paid at maturity or shall be declared due and payable in the manner and with the effect provided in Section 9.02 of the Indenture, the 1996 Series A Bonds shall bear interest on the amount of the 1996 Series A Accreted Value (hereinafter defined) thereof as of their Stated Maturity or the date of such declaration, as the case may be, at the rate per annum of 7.06%, compounded on February 28, 1997 and annually on the 5th day of January of each year thereafter, computed on the basis of a year consisting of twelve 30-day months. Any such interest shall be payable concurrently with the payment of the principal of such Bonds. The 1996 Series A Bonds shall be issued to and registered in the name of the Company and, upon their issuance, shall be pledged to, and held by, the Owner Trustee pursuant to the Pledge Agreement, solely as security for the Company's obligation to pay the Secured Claims. The 1996 Series A Bonds shall be lettered "A" and numbered from 1 consecutively upwards in order of issuance hereunder. All payments and prepayments under the 1996 Series A Bonds shall be made in lawful money of the United States of America to such address or account as the Holders thereof shall direct, from time to time, by written notice to the Issuer Company and the Trustee. The 1996 Series A Bonds are redeemable prior to April 30, 1999. Subject to Article 13 of the Original Indenture, on their Stated Maturity at any time in whole or after May 1, 1999, the Issuer shall have the right to redeem this Debenture in part at the option of the IssuerCompany without the payment of any penalty or premium. Upon the optional redemption of any 1996 Series A Bond (or portion thereof), without premium the Company shall pay to the Holder thereof the 1996 Series A Accreted Value of such Bond or penaltyportion thereof being redeemed, in whole or in part, at a determined as provided below. In the event of an optional redemption price equal to 100% of the principal amount 1996 Series A Bonds, the Company shall cause notice of such redemption to be given to the Holders of the Bonds to be redeemed plus at their addresses as the accrued and unpaid interest thereon same shall last appear upon the Bond Register at least one day prior to the date fixed for redemption. Any redemption pursuant to this paragraph will be made upon not less than 30 nor more than 60 days notice to the Trustee and Holders of the Debentures (with the Trustee to be notified at least three days prior to notice to such Holders). If the Debentures are only partially redeemed by the Issuer, the notes will be redeemed pro rata or by lot or by any other method utilized by the Trustee; provided that if at the time of redemption, the Debentures are registered as a Global Debenture, the Depositary shall determine by lot the principal amount of such Debentures held by each Debenture holder to be redeemed. In the event of a partial optional redemption of this Debenture in part onlythe 1996 Series A Bonds, a new Debenture or Debentures of this series Bond for the unredeemed portion hereof will be issued in the name of the registered holder hereof applicable Holder upon cancellation of such partially redeemed Bond. Except as provided in the cancellation hereof. In case an Event next sentence, for purposes of Default, as defined in Section 9.22 of the Original Indenture and for all other purposes under the Indenture, the "principal amount" of any 1996 Series A Bond shall have occurred and be continuingits then current 1996 Series A Accreted Value. Notwithstanding the foregoing, the principal of all of the Debentures may be declared, and upon such declaration shall become, due and payable, in the manner, with the effect and subject to the conditions provided in the Indenture. The Indenture contains provisions for defeasance at any time of the entire indebtedness of this Debenture upon compliance by the Issuer with certain conditions set forth therein. The Indenture contains provisions permitting the Issuer and the Trustee, with the consent of the registered holders of not less than a majority in aggregate principal amount of the outstanding Debentures of all series affected at the time, as defined in the Indenture, to execute supplemental indentures for the purpose of adding any provisions to or changing in any manner or eliminating any of serving as the provisions of the Indenture or of any supplemental indenture or of modifying in any manner the rights of the registered holders of the Debentures; provided, however, that no such supplemental indenture shall (i) extend the final maturity of any Debentures of any series, or reduce the principal amount thereof, or reduce the rate of or extend the time of payment of interest thereon (except that a valid extension of an interest payment period by the Issuer in accordance with the terms of any indenture supplemental hereto, shall not constitute an extension of interest basis for this purpose), or reduce any amount payable on redemption thereof, or make the principal thereof (including any amount in respect of original issue discount) or interest thereon payable in any coin or currency other than that provided herein or in accordance with the terms hereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due authenticating and payable upon an acceleration of the maturity thereof pursuant to delivering additional Bonds under Section 5.1 of the Original Indenture or the amount thereof provable in bankruptcy pursuant to Section 5.2 5.03 of the Original Indenture, or alter the provisions of Section 11.11 or 11.12 of the Original Indenture or impair or affect the right "principal amount" of any Securityholder to institute suit for the payment thereof or, if the Securities provide therefor, any right of repayment at the option of the Securityholder, or modify any provisions of the Indenture relating to the subordination of each Debenture in a manner adverse to such Holder, in each case without the consent of the registered holder of each Debenture so affected or (ii) reduce the aforesaid percentage of Debentures, the registered holders of which are required to consent to any such supplemental indenture, without the consent of the registered holders of each Debenture then outstanding and affected thereby. The Indenture also contains provisions permitting (i) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive compliance by the Issuer with certain provisions of the Indenture and (ii) the registered holders of a majority in aggregate principal amount of the Debentures of all series at the time outstanding affected thereby, on behalf of the registered holders of the Debentures of such series, to waive certain past defaults under the Indenture and their consequences. Any such consent or waiver by the registered holder of this Debenture (unless revoked as provided in the Indenture) 1996 Series A Bond shall be conclusive and binding upon such registered holder and upon all future registered holders and owners of this Debenture and of any Debenture issued in exchange hereof or in place hereof the 1996 Series A Initial Value (whether by registration of transfer or otherwisehereinafter defined), irrespective of whether or not any notation of such consent or waiver is made upon this Debenture. No reference herein to the Indenture and no provision of this Debenture or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Debenture at the time and place and at the rate and in the coin or currency herein prescribed. The Issuer shall have the right at any time, on one or more occasions, so long as an Event of Default has not occurred and is not continuing under the Indenture with respect to the Debentures, to extend any interest payment period on this Debenture for a period not to exceed 20 consecutive quarterly interest payment periods and, as a consequence, the quarterly interest payment on the Debentures would be deferred (but would continue to accrue with interest thereon compounded quarterly at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) during any such Deferral Period (as defined in the Indenture). At the end of each Deferral Period, the Issuer shall pay all interest then accrued and unpaid (compounded quarterly, at the rate of interest on the Debentures, except to the extent payment of such interest is prohibited by law) to the persons in whose name the Debentures are registered on the Record Date immediately preceding the Interest Payment Date at the end of such Deferral Period. In the event the Issuer exercises this right, the Issuer shall not declare or pay any dividends on, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its Capital Stock (as defined in the Indenture) or make any guarantee payments with respect to the foregoing during such Deferral Period, other than redemptions of any series of Capital Stock of the Issuer pursuant to the terms of any sinking fund provisions with respect thereto. In addition, during any Deferral Period, the Issuer may not (i) make any distributions, loans or guarantees for the benefit of, (ii) purchase, defease, redeem or otherwise acquire or retire for value any securities of or (iii) make any other investment in any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Issuer, for the purpose of, or to enable the payment of, directly or indirectly, dividends on any equity securities of Fund American Enterprises, Inc. and its successors or assigns. During any Deferral Period, the Issuer may continue to extend the interest payment period by extending the Deferral Period, on one or more occasions; provided that such Deferral Period, as extended, must end on an Interest Payment Date and in no event shall the aggregate Deferral Period, as extended, exceed 20 consecutive quarterly interest payment periods or extend beyond the maturity of the Debentures or any date on which any of the Debentures are fixed for redemption. No interest shall be due and payable on the Debentures during a Deferral Period except at the end thereof. The Issuer shall give the Trustee and the registered holders of Debentures notice (with the Trustee to receive notice at least three days prior to such Holders) of its election to defer interest payments or to extend the Deferral Period ten Business Days prior to the earlier of (i) the next scheduled quarterly Interest Payment Date or (ii) the date the Issuer is required to give notice of the record date of such related interest payment to the New York Stock Exchange or other applicable self-regulatory organization or to the holders of the Debentures, but in any event not less than two Business Days prior to such record date. As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Debenture is registrable in the Security Register of the Issuer, upon surrender of this Debenture for registration of transfer at the office or agency of the Issuer in any place where the principal of and any interest on this Debenture are payable or at such other offices or agencies as the Issuer may designate, duly endorsed by or accompanied by a written instrument or instruments of transfer in form satisfactory to the Issuer and the Security Registrar or any transfer agent duly executed by the registered holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Debentures of this series and of like tenor, of authorized denominations and for the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be made for any such transfer, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in relation thereto. Prior to due presentment for registration of transfer of this Debenture, the Issuer, the Trustee, any paying agent and any Debenture Registrar may deem and treat the registered holder hereof as the absolute owner hereof (whether or not this Debenture shall be overdue and notwithstanding any notice of ownership or writing hereon made by anyone other than the Debenture Registrar) for the purpose of receiving payment of or on account of the principal hereof and interest due hereon and for all other purposes, and neither the Issuer nor the Trustee nor any paying agent nor any Debenture Registrar shall be affected by any notice to the contrary. The Debentures of this series are issuable only in fully registered form without coupons in denominations of $25 and any integral multiple thereof. Debentures of this series so issued are issuable only in registered form without coupons in denominations of $25 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein set forth, Debentures of this series are exchangeable for a like aggregate principal amount of Debentures of this series of a different authorized denomination, as requested by the registered holder surrendering the same. As set forth in, and subject to the provisions of, the Indenture, no registered owner of any Debenture will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless (i) such registered owner shall have previously given to the Trustee written notice of a continuing Event of Default with respect to the Debentures of this series, (ii) the registered owners of not less than 25% in principal amount of the outstanding Debentures of all affected series then Outstanding shall have made written request, and offered reasonable indemnity, to the Trustee to institute such proceeding as trustee, (iii) the Trustee shall have failed to institute such proceeding within 60 days and (iv) the Trustee shall not have received from the registered owners of a majority in principal amount of the outstanding Debentures of this series a direction inconsistent with such request within such 60-day period; provided, however, that such limitations do not apply to a suit instituted by a registered owner hereof for the enforcement of payment of the principal of or any interest on this Debenture on or after the respective due dates expressed herein, subject to deferral as set forth herein. All terms used in this Debenture which are defined in the Indenture shall have the meanings assigned to them in the Indenture. FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto ------------------------------------------------------------------------------- (Please insert Social Security or other number of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) ------------------------------------------------------------------------------- (please print or type name and address, including zip code of assignee) the within Debenture and all rights thereunder, hereby irrevocably constituting and appointing such person attorneys to transfer the within Debenture on the books of the Issuer, with full power of substitution in the premises. Dated: _____________________ ___________________________________.