<PAGE>
Exhibit 3
If this Public Income NotES (PINES(R)) is registered in the name of The
Depository Trust Company (the "Depositary") (55 Water Street, New York, New
York) or its nominee, this PINES may not be transferred except as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor Depositary
unless and until this PINES is exchanged in whole or in part for PINES in
definitive form. Unless this certificate is presented by an authorized
representative of the Depositary to the Issuer or its agent for registration of
transfer, exchange or payment, and any certificate issued is registered in the
name of Cede & Co. or such other name as requested by an authorized
representative of the Depositary and any payment is made to Cede & Co, ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest
herein.
Except as otherwise provided in Section 2.12 of the Indenture referred
to on the reverse hereof, this Registered Global Security may be transferred, in
whole but not in part, by the Depositary to a nominee of such Depositary or by a
nominee of such Depositary or by such Depositary or any such nominee to a
successor Depositary or to a nominee of such successor Depositary. Unless this
Registered Global Security is presented by an authorized representative of the
Depositary to the Issuer or its agent for registration of transfer, exchange or
payment, and in the case of any transfer or exchange, any Registered Global
Security issued in exchange therefor is registered in the name of the Depositary
or such other name as requested by an authorized representative of the
Depositary and, in the case of any payment, such payment is made to the
Depositary or the Depositary's nominee, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since Cede & Co. has an
interest herein.
REGISTERED
No. A-1
CUSIP: 55262C 30 8 $100,000,000
MBIA INC.
8% Public Income NotES (PINES(R)) due 2040
MBIA Inc., a Connecticut corporation (the "Issuer"), for value received,
hereby promises to pay to CEDE & CO., or its registered assigns, at the office
or agency of the Issuer in the Borough of Manhattan, The City of New York, the
principal sum of ONE HUNDRED MILLION Dollars on December 15, 2040, in such coin
or currency of the United States of America as at the time of payment shall be
legal tender for the payment of public and private debts, and to pay interest,
quarterly on March 15, June 15,
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September 15 and December 15 of each year, commencing March 15, 2001, on said
principal sum at said office or agency, in like coin or currency, at the rate
per annum specified in the title of this PINES, from the March 15, June 15,
September 15 or December 15, as the case may be, next preceding the date of this
PINES to which interest has been paid, unless the date hereof is a date to which
interest has been paid, in which case from the date of this PINES, or unless no
interest has been paid this PINES, in which case from December 4, 2000, until
payment of said principal sum has been made or duly provided for; provided, that
payment of interest may be made at the option of the Issuer by check mailed to
the address of the person entitled thereto as such address shall appear on the
security register. Notwithstanding the foregoing, if the date hereof is after
the first day of March, June, September or December, as the case may be, and
before the following March 15, June 15, September 15 or December 15,
respectively, this PINES shall bear interest from such March 15, June 15,
September 15, or December 15 provided, that if the Issuer shall default in the
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payment of interest due on such March 15, June 15, September 15 or December 15,
then this PINES shall bear interest from the next preceding March 15, June 15,
September 15 or December 15 to which interest has been paid or, if no interest
has been paid on this PINES, from December 4, 2000. The interest so payable on
any March 15, June 15, September 15 or December 15 will, subject to certain
exceptions provided in the Indenture referred to on the reverse hereof, be paid
to the person in whose name this PINES is registered at the close of business on
the date fifteen calendar days prior to such interest payment date, whether or
not such date is a business day.
Reference is made to the further provisions of this PINES set forth on
the reverse hereof. Such further provisions shall for all purposes have the same
effect as though fully set forth at this place.
This PINES shall not be valid or become obligatory for any purpose until
the certificate of authentication hereon shall have been signed by the Trustee
under the Indenture referred to on the reverse hereof.
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IN WITNESS WHEREOF, MBIA Inc. has caused this instrument to be signed by
its duly authorized officers and has caused its corporate seal to be affixed
hereunto or imprinted hereon.
Dated: December 4, 2000
MBIA INC.
By: /s/ Gary C. Dunton
--------------------------------
By: /s/ Douglas C. Hamilton
--------------------------------
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the PINES of the series designated herein referred to in
the within-mentioned Indenture.
BANK ONE TRUST COMPANY, N.A.
(formerly The First National Bank of
Chicago), as Trustee
By /s/ Mary Fonti
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Authorized Officer
3
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[REVERSE SIDE OF PINES]
MBIA INC.
8% Public Income NotES (PINES(R)) due 2040
This PINES is one of a duly authorized issue of debentures, notes, bonds or
other evidences of indebtedness of the Issuer (hereinafter called the "Debt
Securities") of the series hereinafter specified, all issued or to be issued
under and pursuant to an indenture dated as of August 1, 1990 (herein called the
"Indenture"), duly executed and delivered by the Issuer to Bank One Trust
Company, N.A. (formerly The First National Bank of Chicago), Trustee (herein
called the "Trustee"), to which Indenture and all indentures supplemental
thereto reference is hereby made for a description of the rights, limitations of
rights, obligations, duties and immunities thereunder of the Trustee, the Issuer
and the Holders of the PINES. Debt Securities issued under the Indenture may be
issued in one or more series, which different series may be issued in various
aggregate principal amounts, may mature at different times, may bear interest
(if any) at different rates, may be subject to different redemption provisions
(if any), may be subject to different sinking, purchase or analogous funds (if
any) and may otherwise vary as in the Indenture provided. This PINES is one of a
series designated as the 8% Public Income NotES (PINES(R)) due 2040 of the
Issuer, limited in aggregate principal amount to $100,000,000.
In case an Event of Default, as defined in the Indenture, with respect to
the PINES shall have occurred and be continuing, the principal hereof may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Issuer and the Trustee,
with the consent of the Holders of more than 50% in aggregate principal amount
of the Debt Securities at the time Outstanding (as defined in the Indenture) of
all series to be affected (voting as one class), evidenced as in the Indenture
provided, to execute supplemental indentures adding any provisions to or
changing in any manner or eliminating any of the provisions of the Indenture or
of any supplemental indenture or modifying in any manner the rights of the
Holders of the Debt Securities of each such series; provided, however, that no
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such supplemental indenture shall (i) extend the final maturity of any Debt
-
Securities, or reduce the principal amount thereof or any premium thereon, or
reduce the rate or extend the time of payment of any interest thereon, or impair
or affect the rights of any Holder to institute suit for the payment thereof,
without the consent of the Holder of each Debt Security so affected, or (ii)
--
reduce the aforesaid percentage of Debt Securities, the Holders of which are
required to consent to any such supplemental indenture, without the consent of
the Holder of each Debt Security affected. It is also provided in the Indenture
that, with respect to certain defaults or Events of Default regarding the Debt
Securities of any series, prior to any declaration accelerating the maturity of
such Debt
<PAGE>
Securities, the Holders of a majority in aggregate principal amount Outstanding
of the Debt Securities of such series (or, in the case of certain defaults or
Events of Default, all or certain series of the Debt Securities) may on behalf
of the Holders of all the Debt Securities of such series (or all or certain
series of the Debt Securities, as the case may be) waive any such past default
or Event of Default and its consequences. The preceding sentence shall not,
however, apply to a default in the payment of the principal of or premium, if
any, or interest on any of the Debt Securities. Any such consent or waiver by
the Holder of this PINES (unless revoked as provided in the Indenture) shall be
conclusive and binding upon such Holder and upon all future Holders and owners
of this PINES and any PINES which may be issued in exchange or substitution
herefor, irrespective of whether or not any notation thereof is made upon this
PINES or such other PINES.
No reference herein to the Indenture and no provision of this PINES or of
the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this PINES in the manner, at the respective times, at the rate and in the
coin or currency herein prescribed.
The PINES are issuable in registered form without coupons in denominations
of $25 and integral multiples thereof. Upon presentment at the office or agency
of the Issuer in the Borough of Manhattan, The City of New York, in the manner
and subject to the limitations provided in the Indenture, but without the
payment of any service charge, PINES may be exchanged for a like aggregate
principal amount of PINES of other authorized denominations.
The Issuer may redeem the PINES, on the terms and subject to the conditions
set forth in the Indenture, (1) at any time on or after December 15, 2005, in
-
whole or in part, or (2) at any time within 90 days after a Tax Event shall have
-
occurred and be continuing, in whole but not in part, in either case at a
redemption price equal to 100% of the principal amount of PINES being redeemed,
plus any interest accrued thereon to the date of redemption. The PINES do not
provide for any sinking fund.
A "Tax Event" means that the Issuer shall have received an opinion of
counsel (which may be counsel to the Issuer or an affiliate but not an employee
thereof) experienced in such matters to the effect that, as a result of (a) any
-
amendment to, clarification of or change (including any announced prospective
amendment, clarification or change) in, the laws (or any regulations thereunder)
of the United States or (b) any official administrative pronouncement, ruling,
-
regulatory procedure, notice or announcement, including any notice or
announcement of intent to adopt or promulgate any ruling, regulatory procedure
or regulation, or any judicial decision, in each case, occurring or announced on
or after the date of original issuance of the PINES, there is more than an
insubstantial risk that interest payable by the Issuer on the PINES is not, or
<PAGE>
within 90 days will not be, deductible, in whole or in part, by the Issuer for
United States Federal income tax purposes.
The Indenture contains provisions for defeasance at any time of the
entire indebtedness of the PINES or certain covenants with respect to the PINES,
in each case upon compliance with certain conditions set forth therein.
Upon due presentment for registration of transfer of transfer of this
PINES at the office or agency of the Issuer in the Borough of Manhattan, The
City of New York, a new PINES or PINES of authorized denominations for an equal
aggregate principal amount will be issued to the transferee in exchange
therefor, subject to the limitations provided in the Indenture, without charge
except for any tax or other governmental charge imposed in connection therewith.
The Issuer, the Trustee and any authorized agent of the Issuer or the
Trustee may deem and treat the registered Holder hereof as the absolute owner of
this PINES (whether or not this PINES shall be overdue and notwithstanding any
notation of ownership or other writing hereon) for the purpose of receiving
payment of, or on account of, the principal hereof and premium, if any, and,
subject to the provisions on the face hereof, interest hereon, and for all other
purposes, and neither the Issuer nor the Trustee nor any authorized agent of the
Issuer or the Trustee shall be affected by any notice to the contrary.
No recourse under or upon any obligation, covenant or agreement of the
Issuer in the Indenture or any indenture supplemental thereto or any PINES, or
because of the creation of any indebtedness represented thereby, shall be had
against any incorporator, stockholder, officer or director, as such, of the
Issuer or of any successor corporation, either directly or through the Issuer
or any successor corporation, under any rule of law, statute or constitutional
provision or by the enforcement of any assessment or by any legal or equitable
proceeding or otherwise, all such liability being expressly waived and released
by the acceptance hereof and as part of the consideration for the issue hereof.
Terms used herein which are defined in the Indenture shall have the
respective meanings assigned thereto in the Indenture.
