KEYSPAN GAS EAST CORPORATION
                        GLOBAL MEDIUM-TERM NOTE, SERIES A

THIS NOTE IS A GLOBAL SECURITY  WITHIN THE MEANING OF THE INDENTURE  HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE  THEREOF.
UNLESS AND UNTIL IT IS EXCHANGED  IN WHOLE OR IN PART FOR NOTES IN  CERTIFICATED
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST
COMPANY (THE  "DEPOSITARY")  TO A NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY
OR ANY SUCH  NOMINEE TO A SUCCESSOR  DEPOSITARY  OR A NOMINEE OF SUCH  SUCCESSOR
DEPOSITARY. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT,  AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS REQUESTED BY AN AUTHORIZED  REPRESENTATIVE  OF THE DEPOSITARY (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER  ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY),  ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR  OTHERWISE  BY OR TO ANY PERSON IS WRONGFUL  INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
<TABLE>
<CAPTION>
<S>                             <C>                                        <C>
REGISTERED                       CUSIP No. 49337EAB6                        PRINCIPAL AMOUNT
No. FX-2                                                                    U.S. $125,000,000

ORIGINAL ISSUE DATE:                  INTEREST RATE:                        STATED MATURITY:
January 19, 2001                        6.900%                              January 15, 2008

INTEREST PAYMENT                REGULAR RECORD DATE:
DATES: January 15 and           Close of business on the 15th calendar
July 15, commencing             day preceding the interest payment date
July 15, 2001

OPTIONAL REPAYMENT DATE(S):                                                 ADDENDUM ATTACHED:
Not Applicable                                                                Yes
                                                                            X No

DENOMINATIONS:                                                              OTHER PROVISIONS:
$1,000 and integral multiples thereof                                       Not Applicable
</TABLE>


<PAGE>





                  KEYSPAN  GAS EAST  CORPORATION,  a New York  corporation  (the
"Issuer" or the "Company," which terms include any successor  corporation  under
the Indenture  hereinafter referred to), for value received,  hereby promises to
pay to CEDE & CO.,  or  registered  assigns,  the  principal  sum of ONE HUNDRED
TWENTY-FIVE  MILLION U.S. DOLLARS on the Stated Maturity specified above (except
to the  extent  redeemed  or repaid  prior to the Stated  Maturity),  and to pay
interest  thereon at the  Interest  Rate per annum  specified  above,  until the
principal hereof is paid or duly made available for payment. Reference herein to
"this Note",  "hereof",  "herein" and comparable terms shall include an Addendum
hereto if an Addendum is specified above.

                  The Company  will pay interest on each  Interest  Payment Date
specified  above,  commencing on the first Interest Payment Date next succeeding
the  Original  Issue Date  specified  above,  and on the Stated  Maturity or any
Redemption Date or Optional  Repayment Date (as defined below) (the date of each
such Stated Maturity,  Redemption Date and Optional  Repayment Date and the date
on  which  principal  or an  installment  of  principal  is due and  payable  by
declaration  of  acceleration  pursuant  to  the  Indenture  being  referred  to
hereinafter  as a "Maturity"  with  respect to principal  payable on such date);
provided,  however,  that if the Original Issue Date is between a Regular Record
Date (as defined below) and the next succeeding  Interest Payment Date, interest
payments  will  commence on the second  Interest  Payment  Date  succeeding  the
Original Issue Date. Unless otherwise specified above, the "Regular Record Date"
shall be the date 15 calendar  days (whether or not a Business Day) prior to the
applicable  Interest  Payment  Date.  Interest on this Note will accrue from and
including the most recent Interest  Payment Date to which interest has been paid
or duly provided for or, if no interest has been paid,  from the Original  Issue
Date  specified  above,  to, but excluding  such  Interest  Payment Date. If the
Maturity or an Interest Payment Date falls on a day which is not a Business Day,
the payment due on such  Maturity or Interest  Payment  Date will be paid on the
next  succeeding  Business Day with the same force and effect as if made on such
Maturity or Interest  Payment  Date,  as the case may be, and no interest  shall
accrue with respect to such payment for the period from and after such  Maturity
or Interest  Payment Date. The interest so payable and  punctually  paid or duly
provided for on any Interest  Payment Date will as provided in the  Indenture be
paid to the  Person  in  whose  name  this  Note  (or  one or  more  Predecessor
Securities)  is registered  at the close of business on the Regular  Record Date
for such Interest  Payment Date.  Any such  interest  which is payable,  but not
punctually paid or duly provided for on any Interest Payment Date (herein called
"Defaulted  Interest"),  shall  forthwith  cease to be payable to the registered
Holder on such Regular  Record Date, and may be paid to the Person in whose name
this Note (or one or more Predecessor  Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted  Interest to
be fixed by the  Trustee,  notice  whereof  shall be given to the Holder of this
Note not less than 10 days prior to such Special  Record Date, or may be paid at
any  time  in any  other  lawful  manner,  all as  more  fully  provided  in the
Indenture.

                  The Notes  are,  and all  other  Securities  issued  under the
Indenture  will be,  unconditionally  guaranteed as to payment of principal (and
premium, if any),  interest,  if any, and additional amounts, if any, by KeySpan
Corporation, a New York corporation (the "Guarantor").

                  Payment of the principal of (and premium, if any) and interest
on this Note will be made at the office or agency of the Company  maintained  by
the Company for such purpose in the Borough of Manhattan,  The City of New York,
in such coin or  currency  of the  United  States of  America  as at the time of
payment is legal tender for payment of public and private debts.

                  Unless  the  certificate  of  authentication  hereon  has been
executed by or on behalf of The Chase  Manhattan Bank, the Trustee for this Note
under the Indenture, or its successor thereunder, by the manual signature of one
of its authorized officers, this Note shall not be entitled to any benefit under
the Indenture or be valid or obligatory for any purpose.

                  This  Note is one of a duly  authorized  issue  of  Securities
(hereinafter   called  the  "Securities")  of  the  Company  designated  as  its
Medium-Term Notes,  Series A (the "Notes").  The Securities are issued and to be
issued  under an  indenture  (the  "Indenture")  dated as of  December  1, 1999,
between the Company,  the Guarantor and The Chase  Manhattan Bank (herein called
the "Trustee,"  which term includes any successor  Trustee under the Indenture),
to which Indenture and all indentures  supplemental  thereto reference is hereby
made for a statement of the  respective  rights  thereunder of the Company,  the
Guarantor, the Trustee and the Holders of the Notes and the terms upon which the
Notes are to be authenticated  and delivered.  The terms of other Notes may vary
with respect to interest rates or interest rate formulas, issue dates, maturity,
redemption,  repayment,  currency  of payment and  otherwise  as provided in the
Indenture.

                  The Notes are issuable only in registered form without coupons
in  denominations,  unless  otherwise  specified  above,  of $1,000 and integral
multiples  thereof.  As  provided  in  the  Indenture  and  subject  to  certain
limitations  therein set forth,  the Notes are exchangeable for a like aggregate
principal  amount of Notes as requested by the Holder  surrendering the same. If
(x) the  Depositary is at any time unwilling or unable to continue as depository
and a successor  depository is not appointed by the Company  within 90 days, (y)
the Company delivers to the Trustee a Company Order to the effect that this Note
shall be  exchangeable or (z) an Event of Default has occurred and is continuing
with  respect  to the  Notes,  this  Note  shall be  exchangeable  for  Notes in
definitive form of like tenor and in an equal  aggregate  principal  amount,  in
authorized denominations. Such definitive Notes shall be registered in such name
or names as the Depositary  shall instruct the Trustee.  If definitive Notes are
so delivered,  the Company may make such changes to the form of this Note as are
necessary or appropriate to allow for the issuance of such definitive Notes.

                  This Note is not subject to any sinking fund.

                  This Note may be  subject  to  repayment  at the option of the
Holder prior to its Stated Maturity on any Holder's Optional  Repayment Date(s),
if any,  indicated  above.  If no Optional  Repayment Dates are set forth above,
this Note may not be so repaid at the option of the Holder  hereof  prior to the
Stated Maturity.  On any Optional Repayment Date this Note shall be repayable in
whole or in part in an amount equal to $1,000 or any integral  multiple  thereof
(provided   that  any  remaining   principal   amount  shall  be  an  authorized
denomination)  at the option of the Holder hereof at a repayment  price equal to
100% of the  principal  amount to be  repaid,  together  with  interest  thereon
payable to the date of repayment. For this Note to be repaid in whole or in part
at the option of the Holder  hereof,  this Note must be received,  with the form
entitled "Option to Elect Repayment" below duly completed, by the Trustee at its
office at 450 West 33rd  Street,  15th Floor,  New York,  New York 10001 or such
address  which the  Company  shall from time to time  notify  the Holder  hereof
("Corporate  Trust Office"),  not more than 60 nor less than 30 days prior to an
Optional Repayment Date. This Note must be received by the Trustee by 5:00 P.M.,
New York City time,  on the last day for giving  such  notice.  Exercise of such
repayment  option by the Holder  hereof  shall be  irrevocable.  In the event of
payment of this Note in part  only,  a new Note for the  unpaid  portion  hereof
shall be issued in the name of the Holder hereof upon the surrender hereof.

                  This Note will be redeemable  at the option of the Issuer,  in
whole at any time or in part from time to time ( each such date of redemption, a
"Redemption Date") prior to its Stated Maturity,  at a redemption price equal to
the greater of (i) 100% of its principal  amount and (ii) the sum, as determined
by the  Independent  Investment  Banker,  of the present  value of the principal
amount and the  remaining  scheduled  payments  of  interest  on the notes to be
redeemed,  discounted from their scheduled  payment dates to the Redemption Date
on a semiannual  basis  (assuming a 360-day  year  consisting  of twelve  30-day
months) at the Adjusted  Treasury Rate, plus accrued but unpaid interest thereon
to the Redemption Date.

                   "Adjusted   Treasury   Rate"  means,   with  respect  to  any
Redemption Date, the rate per annum equal to the semiannual  equivalent yield to
maturity of the Comparable Treasury Issue,  calculated on the third Business Day
preceding such Redemption  Date using a price for the Comparable  Treasury Issue
(expressed  as a percentage of its  principal  amount)  equal to the  Comparable
Treasury Price for such Redemption Date, plus 25 basis points.

                   "Comparable  Treasury Issue" means the United States Treasury
security  selected  by the  Independent  Investment  Banker as having a maturity
comparable  to the  remaining  term of the notes to be  redeemed  that  would be
utilized,  at the time of selection and in accordance  with customary  financial
practice,  in pricing new issues of  corporate  debt  securities  of  comparable
maturity to the remaining term of such notes to be redeemed.

                   "Comparable  Treasury  Price"  means,  with  respect  to  any
redemption  date, the average of the Reference  Treasury  Dealer  Quotations for
such  Redemption  Date,  after  excluding the highest and lowest such  Reference
Treasury  Dealer  Quotations,  or if the  Trustee  obtains  fewer than four such
Reference Treasury Dealer Quotations, the average of all such Reference Treasury
Dealer Quotations.

                   "Independent  Investment  Banker"  means one of the Reference
Treasury Dealers appointed by the Trustee after consultation with the Issuer.

     "Reference  Treasury  Dealers"  means Merrill Lynch  Government  Securities
Inc.,  Chase  Securities Inc. and Salomon Smith Barney Inc. or their  affiliates
which are primary  U.S.  Government  securities  dealers,  and their  respective
successors and any other primary U.S. Government  securities dealers in New York
City (each a "Primary  Treasury  Dealer") selected by the Issuer in addition to,
or in  substitution  for,  such  firms;  provided,  however,  that if any of the
foregoing  shall  cease  to  be a  Primary  Treasury  Dealer,  the  Issuer  will
substitute another Primary Treasury Dealer.

                   "Reference Treasury Dealer Quotations" means, with respect to
each  Reference  Treasury  Dealer  and any  Redemption  Date,  the  average,  as
determined  by the  Trustee,  of the bid and  asked  prices  for the  Comparable
Treasury Issue (expressed in each case as a percentage of its principal  amount)
quoted in writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m.,
New York City time, on the third Business Day preceding such Redemption Date.

                  Interest on this Note will accrue  from,  and  including,  the
Original Issue Date indicated  above,  or the most recent date to which interest
has been paid or duly  provided  for, to, but  excluding,  the related  Interest
Payment  Date or Maturity,  as the case may be, at the  Interest  Rate per annum
stated above until the  principal  amount  hereof is paid or made  available for
payment.  Unless  otherwise  specified  above,  interest will be computed on the
basis of a  360-day  year of  twelve  30-day  months  for the  period  specified
hereunder.

                  Any provision contained herein with respect to the calculation
of the interest  applicable to this Note,  its payment dates or any other matter
relating  hereto may be modified as specified in an Addendum  relating hereto if
so  specified  above or as set forth under  "Other  Provisions"  if so set forth
above.

                  If an Event of  Default  (as  defined in the  Indenture)  with
respect to the Notes shall occur and be  continuing,  the  principal  of all the
Notes may be declared due and payable in the manner and with the effect provided
in the  Indenture.  If the  principal of any  Original  Issue  Discount  Note is
declared  to be due and payable  immediately,  the amount of  principal  due and
payable  with  respect to such Note shall be limited to the amount  equal to (i)
the sum of the aggregate  principal  amount of such Note multiplied by the price
(expressed as a percentage of the aggregate principal amount) at which such Note
will be issued (the "Issue Price") plus (ii) the original issue discount accrued
from  the  date of issue to the  date of  declaration,  which  accrual  shall be
calculated  using the "interest  method"  computed in accordance  with generally
accepted  accounting  principals  in  effect  on the  date  of  declaration.  An
"Original Issue Discount Note" means (i) a Note, including any zero-coupon Note,
that has a stated redemption price at maturity that exceeds the initial offering
price to the public at which a  substantial  amount of an offering is sold by at
least 0.25% of its principal amount  multiplied by the number of full years from
the  Original  Issue  Date to the  stated  Maturity  for such  Note and which is
designated as an Original Issue Discount Note in the terms of such Note pursuant
to the  Indenture,  and (ii) any other Note  designated by the Company as issued
with original issue discount for United States federal income tax purposes.

                  The  Indenture  permits,  with certain  exceptions  as therein
provided,  the amendment or modification thereof at any time by the Company, the
Guarantor  and the  Trustee  with the consent of the Holders of more than 50% in
principal amount of the Securities at the time outstanding of each series issued
under  the  Indenture  to be  affected  thereby.  The  Indenture  also  contains
provisions  permitting  the Holders of more than 50% in principal  amount of the
Securities of each series at the time  outstanding,  on behalf of the Holders of
all the  Securities of that series,  to waive  compliance by the Company and the
Guarantor  with certain  provisions  of the  Indenture and certain past defaults
under the Indenture and their consequences with respect to such series. Any such
consent  or waiver by the Holder of this Note shall be  conclusive  and  binding
upon such Holder and upon all future Holders of this Note and of any Note issued
upon the  registration  of  transfer  hereof or in  exchange  herefor or in lieu
hereof,  whether  or not  notation  of such  consent or waiver is made upon this
Note.

                  No reference  herein to the Indenture and no provision of this
Note or of the  Indenture  shall alter or impair the  obligation of the Company,
which is absolute and  unconditional,  to pay the principal of (and premium,  if
any) and interest on this Note at the time,  place and rate,  and in the coin or
currency, herein and in the Indenture prescribed.

                  As   provided  in  the   Indenture   and  subject  to  certain
limitations  set forth  therein  and  above,  the  transfer  of this Note may be
registered on the Security Register of the Company,  upon surrender of this Note
for  registration  of  transfer  at the  office or agency of the  Company in the
Borough of Manhattan,  The City of New York, duly endorsed by, or accompanied by
a written  instrument  of transfer  in form  satisfactory  to the  Company  duly
executed by, the Holder  hereof or by his attorney  duly  authorized in writing,
and thereupon one or more new Notes of authorized denominations and for the same
aggregate  principal  amount,  and  having  endorsed  thereon a  Guarantee  duly
executed  by the  Guarantor,  will be issued  to the  designated  transferee  or
transferees.

                  No service charge shall be made for any such  registration  of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.

                  Prior to due  presentment  of this  Note for  registration  of
transfer,  the Company, the Guarantor,  the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Note is registered as the
owner hereof for all purposes,  whether or not this Note be overdue, and neither
the Company, the Guarantor,  the Trustee nor any such agent shall be affected by
notice to the contrary.

                  Certain of the Company's and the Guarantor's obligations under
the  Indenture  with respect to Notes,  may be  terminated if the Company or the
Guarantor irrevocably deposits with the Trustee money or Government  Obligations
sufficient  to pay and  discharge  the  entire  indebtedness  on all  Notes,  as
provided in the Indenture.

                  The Indenture and the Notes shall be governed by and construed
in accordance with the laws of the State of New York.

                  All terms used in this Note which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.



<PAGE>



                  IN WITNESS WHEREOF,  the Company has caused this instrument to
be duly executed,  manually or in facsimile,  and an imprint or facsimile of its
corporate seal to be imprinted hereon.

Dated: January 19, 2001


                                           KEYSPAN GAS EAST CORPORATION



                                           By:     /s/Norma Y. Rodriguez
                                           Name:   Norma Y. Rodriguez
                                                   Title: Treasurer

                                           Attest:
                                           By:      Paul R. Nick
                                           Name:    Paul R. Nick
                                                    Title: Controller and Chief
                                                           Accounting Officer

CERTIFICATE  OF  AUTHENTICATION
This  is one of the  Securities
of the  series designated therein
referred to in the within-mentioned Indenture.

THE CHASE MANHATTAN BANK,
    as Trustee


By: /s/ Francine Springer
    Authorized Officer



<PAGE>



                            OPTION TO ELECT REPAYMENT
         The  undersigned  hereby  irrevocably  request(s) and  instruct(s)  the
Company to repay this Note (or portion hereof  specified  below) pursuant to its
terms at a price equal to the principal  amount hereof together with interest to
the repayment date, to the undersigned, at

                 (Please print or typewrite name and address of the undersigned)
                  For this Note to be repaid,  the Trustee  must  receive at its
Corporate  Trust  Office,  or at such other place or places of which the Company
shall from time to time  notify  the  Holder of this Note,  not more than 60 nor
less than 30 days prior to an Optional Repayment Date, if any, shown on the face
of this  Note,  this  Note  with  this  "Option  to Elect  Repayment"  form duly
completed.  This Note notice  must be received by the Trustee by 5:00 P.M.,  New
York City time, on the last day for giving such notice.

                  If less than the entire principal amount of this Note is to be
repaid,  specify the portion hereof (which shall be in an amount equal to $1,000
or an integral multiple thereof, provided that any remaining principal amount is
equal to an authorized  denomination) which the Holder elects to have repaid and
specify the denomination or denominations  (which shall be in an amount equal to
an  authorized  denomination)  of the Notes to be issued to the  Holder  for the
portion of this Note not being repaid (in the absence of any such specification,
one such Note will be issued for the portion not being repaid).

$ -----------------------          ---------------------------------------------
                                   NOTICE: The signature on this Option to Elect
Date_____________________                   Repayment must  correspond  with the
                                            name as  written  upon  the  face of
                                            this   Note  in  every   particular,
                                            without alteration or enlargement or
                                            any change whatever


<PAGE>



                            ASSIGNMENT/TRANSFER FORM
                  FOR VALUE RECEIVED the  undersigned  registered  Holder hereby
sell(s),  assign(s) and transfer(s)  unto (insert Taxpayer  Identification  No.)
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
(Please  print  or  typewrite  name and  address  including  postal  zip code of
assignee)
______________________________________________________________________________
the within Note and all rights thereunder,  hereby irrevocably  constituting and
appointing  ________________________________________  attorney to transfer  said
Note on the  books  of the  Company  with  full  power  of  substitution  in the
premises.

Date:  -------------    -------------------------------------------------------
                        NOTICE: The signature of the registered Holder to this
                        assignment must correspond with the name as written
                        upon the face of the within instrument in every
                        particular, without alteration or enlargement or any
                        change whatsoever.


<PAGE>



                                    GUARANTEE

                  FOR  VALUE   RECEIVED,   KEYSPAN   CORPORATION,   a  New  York
corporation (the "Guarantor"),  hereby fully and  unconditionally  guarantees to
each Holder of a Note  authenticated  and  delivered by the Trustee,  and to the
Trustee  on behalf of each such  Holder,  the due and  punctual  payment  of the
principal of (and premium, if any) and interest,  if any, on each such Note, the
due and punctual  payment of any sinking fund payments  provided for pursuant to
the terms of such Note and the payment of any additional amounts when and as the
same  shall  become  due  and  payable,  whether  at  the  Stated  Maturity,  by
declaration of  acceleration,  call for  redemption or otherwise,  in accordance
with the terms of such Note and of the  Indenture,  dated as of December 1, 1999
(the "Indenture") by and among KeySpan Gas East Corporation (the "Issuer" or the
"Company"),  the  Guarantor  and The  Chase  Manhattan  Bank,  as  Trustee  (the
"Trustee").  In case of the failure of the Company  punctually  to make any such
payment of principal (or premium,  if any) or interest,  if any, or sinking fund
payment or payment of additional  amounts,  the Guarantor hereby agrees to cause
any such payment to be made punctually when and as the same shall become due and
payable, whether at the Stated Maturity or by declaration of acceleration,  call
for redemption or otherwise, and as if such payment were made by the Company.

                  The  Guarantor  hereby agrees that its  obligations  hereunder
shall  be   unconditional,   irrespective   of  the   validity,   regularity  or
enforceability  of such Note or the  Indenture,  the  absence  of any  action to
enforce  the same,  any  waiver or  consent by the Holder of such Note or by the
Trustee  with  respect  to  any  provisions  thereof  or of the  Indenture,  the
obtaining of any judgment  against the Company or any action to enforce the same
or any other circumstances which might otherwise constitute a legal or equitable
discharge or defense of a guarantor. The Guarantor hereby waives the benefits of
diligence,  presentment, demand of payment, filing of claims with a court in the
event of  insolvency  or  bankruptcy  of the  Company,  any  right to  require a
proceeding  first  against the  Company,  protest or notice with respect to such
Note or the indebtedness  evidenced  thereby or with respect to any sinking fund
payment required pursuant to the terms of such Note and all demands  whatsoever,
and covenants  that this  Guarantee  will not be  discharged  except by complete
performance  of the  obligations  contained in the Notes and in this  Guarantee.
This Guarantee is a guarantee of payment and not  collection.  If the Trustee or
the Holder of any Note is  required by any court or  otherwise  to return to the
Company or the  Guarantor,  or any  custodian,  receiver,  liquidator,  trustee,
sequestrator or other similar  official acting in relation to the Company or the
Guarantor,  any amount  paid to the Trustee or such Holder in respect of a Note,
this Guarantee,  to the extent  theretofore  discharged,  shall be reinstated in
full force and effect.  The Guarantor further agrees, to the fullest extent that
it lawfully may do so, that, as between the  Guarantor on the one hand,  and the
Holders and the  Trustee,  on the other hand,  the  maturity of the  obligations
guaranteed  hereby may be  accelerated as provided in Article V of the Indenture
for the purposes of this  Guarantee,  notwithstanding  any stay,  injunction  or
other  prohibition  extant under any applicable  bankruptcy law preventing  such
acceleration in respect of the obligations guaranteed hereby.

                  The Guarantor shall be subrogated to all rights of the Holders
of the Notes of a particular series against the Company in respect of any amount
paid by the Guarantor on account of such Note pursuant to the provisions of this
Guarantee or the Indenture;  provided,  however, that the Guarantor shall not be
entitled  to enforce or to receive any  payments  arising out of, or based upon,
such right of  subrogation  until the  principal  of (and  premium,  if any) and
interest,  if any, on all Notes of such series issued  hereunder shall have been
paid in full.

                  The  Guarantor  hereby  certifies  and warrants that all acts,
conditions  and things  required to be done and  performed  and to have happened
prior to the creation and issuance of this  Guarantee and to constitute the same
as the legal,  valid and binding  obligation  of the  Guarantor  enforceable  in
accordance with its terms, have been done and performed and have happened in due
and strict compliance with applicable laws.

                  The   delivery  of  any  Note  by  the   Trustee,   after  the
authentication thereof, shall constitute due delivery of this Guarantee endorsed
thereon  on behalf of the  Guarantor.  The  Guarantor  hereby  agrees  that this
Guarantee shall remain in full force and effect  notwithstanding  any failure to
endorse on each Note a notation of this Guarantee.

                  This   Guarantee   shall  be  governed  by  and  construed  in
accordance with the laws of the State of New York.

                  All terms  used in this  Guarantee  which are  defined  in the
Indenture shall have the meanings assigned to them in the Indenture.



<PAGE>



                  IN  WITNESS  WHEREOF,  KEYSPAN  CORPORATION  has  caused  this
Guarantee to be duly executed in its corporate  name by the facsimile  signature
of one of its officers  thereunto duly  authorized and has caused a facsimile of
its corporate seal to be affixed  hereunto or imprinted or otherwise  reproduced
hereon.

Dated as of: January 19, 2001


                                              KEYSPAN CORPORATION
                                              By:   /s/ Ronald S. Jendras
                                              Name: Ronald S. Jendras
                                              Title:Vice-President, Controller
                                              & Chief Accounting Offifcer