<PAGE>

                                                                     Exhibit 4.2

REGISTERED                                                            REGISTERED

                            AIG PROGRAM FUNDING, INC.

                MEDIUM-TERM NOTES, SERIES [A (PF)] [AIG-FP (PF)]
                      [MP, MATCHED INVESTMENT PROGRAM (PF)]

                     FULLY AND UNCONDITIONALLY GUARANTEED BY
                       AMERICAN INTERNATIONAL GROUP, INC.

                          (FORM OF FLOATING RATE NOTE)

     THIS SECURITY 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. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OR TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

NO: __________                          PRINCIPAL AMOUNT: __________

ORIGINAL ISSUE DATE: __________         INITIAL INTEREST RATE: __________

MATURITY DATE: __________               INDEX MATURITY: __________

SPREAD: __________                      SPREAD MULTIPLIER: ___%

CALCULATION AGENT: __________           SPECIFIED CURRENCY: U.S. DOLLARS

INTEREST RATE BASIS: __________              U.S. DOLLARS FOR ALL PAYMENTS
                                             UNLESS OTHERWISE SPECIFIED BELOW
     -    LIBOR
                                                  -    PAYMENTS OF PRINCIPAL AND
     -    EURIBOR                                      OF ANY PREMIUM:

     -    TREASURY RATE                           -    PAYMENTS OF INTEREST:

     -    CMT RATE                                -    EXCHANGE RATE AGENT:

                                        MAXIMUM INTEREST RATE: ___%

<PAGE>

     -    COMMERCIAL PAPER RATE         MINIMUM INTEREST RATE: ___%

     -    PRIME RATE                    INTEREST RESET DATES: __________

     -    CD RATE                       INTEREST PAYMENT DATES: __________

     -    FEDERAL FUNDS EFFECTIVE RATE  INTEREST DETERMINATION DATE: __________

     -    FEDERAL FUNDS OPEN RATE       INTEREST PAYMENT PERIOD: (MONTHLY,
                                        QUARTERLY, SEMI-ANNUALLY OR ANNUALLY)
     -    11TH DISTRICT COST OF FUNDS
          RATE                          INTEREST RATE RESET PERIOD: (DAILY,
                                        WEEKLY, MONTHLY, QUARTERLY,
     -    ANY OTHER RATE                SEMI-ANNUALLY, ANNUALLY OR OTHERWISE)

     AIG PROGRAM FUNDING, INC., a corporation duly organized and existing under
the laws of Delaware (herein called the "Company", which term includes any
successor corporation under the Indenture hereinafter referred to), for value
received, hereby promises to pay to __________________ or registered assigns,
the principal sum of _________________ DOLLARS on the Maturity Date shown above,
and to pay interest thereon from the Original Issue Date shown above or from the
most recent Interest Payment Date to which interest has been paid or duly
provided for, at a rate per annum equal to the Initial Interest Rate shown above
until the first Interest Reset Date specified above and thereafter at a rate
determined in accordance with the provisions on the reverse hereof under the
heading "Determination of LIBOR", "Determination of EURIBOR", "Determination of
Treasury Rate", "Determination of CMT Rate", "Determination of Commercial Paper
Rate", "Determination of Prime Rate" "Determination of CD Rate", "Determination
of Federal Funds Effective Rate", "Determination of Federal Funds Open Rate", or
"Determination of 11th District Cost of Funds Rate", depending upon whether the
Interest Rate Basis is LIBOR, EURIBOR, Treasury Rate, CMT Rate, Commercial Paper
Rate, Prime Rate, CD Rate, Federal Funds Effective Rate, Federal Funds Open
Rate, or 11th District Cost of Funds Rate, as indicated by the marked box above,
until the principal hereof is paid or duly made available for payment. The
Company will pay interest monthly, quarterly, semi-annually or annually as shown
above under "Interest Payment Period", commencing with the Interest Payment Date
next succeeding the Original Issue Date shown above, and ending on the Maturity
Date; provided, however, that if the Original Issue Date is after a Regular
Record Date (as herein defined) and prior to the related Interest Payment Date,
interest payments will commence on the Interest Payment Date following the next
succeeding Regular Record Date. Except as provided above and in the Indenture
referred to on the reverse hereof, monthly interest payments will be made on the
third Wednesday of each month, quarterly interest payments will be made on the
third Wednesday of March, June, September and December of each year, semi-annual
interest payments will be made on the third Wednesday of the two months set
forth above and annual interest payments will be made on the third Wednesday of
the month set forth above. 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 Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, which shall be the fifteenth day (whether or not a Business
Day) immediately preceding such Interest Payment Date. Any such

                    (Face of Security continued on next page)


                                       -2-

<PAGE>

interest which is payable, but is not punctually paid or duly provided for, on
any Interest Payment Date, will cease to be payable to the registered Holder on
such Regular Record Date, and may either be paid to the Person in whose name
this Security (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 Holders of
Securities not less than 10 days prior to such Special Record Date, or be paid
at any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Securities may be listed, and upon such
notice as may be required by such exchange, all as more fully provided in said
Indenture.

     If any Interest Payment Date would otherwise be a day that is not a
Business Day with respect to this Security, the Interest Payment Date shall be
the next succeeding day that is a Business Day, except that if the Interest Rate
Basis specified on the face hereof is LIBOR or EURIBOR and the next succeeding
Business Day falls in the next calendar month, such Interest Payment Date shall
be the immediately preceding Business Day. In all cases, an Interest Payment
Date that falls on the Maturity will not be changed.

     Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
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; provided, however, that at the
option of the Company payment of interest may be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register.

     Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.

     Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof, by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.

                    (Face of Security continued on next page)


                                       -3-

<PAGE>

     IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.

DATED: November ___, 2007

                                        AIG PROGRAM FUNDING, INC.


                                        By:
                                            ------------------------------------
                                        Name: Robert A. Gender
                                        Title: President


                                        Attest:
                                                --------------------------------
                                        Name: Kathleen E. Shannon
                                        Title: Secretary

DATED: November ___, 2007

TRUSTEE'S CERTIFICATE OF AUTHENTICATION

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

                                        THE BANK OF NEW YORK, as Trustee


                                        By:
                                            ------------------------------------
                                            Authorized Signatory


                                       -4-

<PAGE>

                 GUARANTEE OF AMERICAN INTERNATIONAL GROUP, INC.

     Capitalized terms used in this Guarantee that are not defined herein but
that are defined in the Security upon which this Guarantee is endorsed or the
Indenture referred to in such Security are used herein as defined therein.

     For value received, American International Group, Inc. (the "Guarantor")
unconditionally guarantees to the Holder of the Security upon which this
Guarantee is endorsed (the "Holder"), the prompt payment when due of all present
and future payment obligations of AIG Program Funding, Inc. (the "Company") to
the Holder arising out of the Security upon which this Guarantee is endorsed
(hereinafter the "Obligations").

     The Guarantor's obligations hereunder shall not be affected by the
existence, validity, enforceability, perfection or extent of any collateral
therefor or by any other circumstance relating to the Obligations that might
otherwise constitute a legal or equitable discharge of or defense to the
Guarantor not available to the Company. The Guarantor agrees that the Holder may
resort to the Guarantor for payment of any of the Obligations whether or not the
Holder shall have resorted to any collateral therefor or shall have proceeded
against the Company or any other obligor principally or secondarily obligated
with respect to any of the Obligations. The Holder shall not be obligated to
file any claim relating to the Obligations in the event that the Company becomes
subject to a bankruptcy, reorganization or similar proceeding, and the failure
of the Holder to so file shall not affect the Guarantor's obligations hereunder.
In the event that any payment to the Holder in respect of any Obligations is
rescinded or must otherwise be returned for any reason whatsoever, the Guarantor
shall remain liable hereunder with respect to such Obligations as if such
payment had not been made. The Guarantor reserves the right to (a) set-off
against any payment owing hereunder any amounts owing by the Holder to the
Company relating to payments of obligations under the Security upon which this
Guarantee is endorsed and (b) assert defenses which the Company may have to
payment of any Obligations other than defenses arising from the bankruptcy or
insolvency of the Company and other defenses expressly waived hereby.

     The Guarantor agrees that the Holder may at any time and from time to time,
either before or after the maturity thereof, without notice to or further
consent of the Guarantor, extend the time of payment of, exchange or surrender
any collateral for, or renew any of the Obligations, and may also make any
agreement with the Company or with any other party to or person liable on any of
the Obligations or interested therein, for the extension, renewal, payment,
compromise, discharge or release thereof, in whole or in part, or for any
modification of the terms thereof or of any agreement between the Holder and the
Company or any such other party or person without in any way impairing or
affecting this Guarantee. The Guarantor waives notice of the acceptance of this
Guarantee and of the Obligations, presentment, demand for payment, notice of
dishonor and protest.

     The Guarantor agrees to pay on demand all fees and out of pocket expenses
(including the reasonable fees and expenses of the Holder's counsel) in any way
relating to the enforcement or protection of the rights of the Holder hereunder;
provided, that the Guarantor shall not be liable for any expenses of the Holder
if no payment under this Guarantee is due.

     Upon payment of any of the Obligations, the Guarantor shall be subrogated
to the rights of the Holder against the Company with respect to such
Obligations, and the Holder agrees to take at the Guarantor's expense such steps
as the Guarantor may reasonably request to implement such subrogation.


                                       -5-

<PAGE>

     This Guarantee is absolute and unconditional and shall remain in full force
and effect and be binding upon the Guarantor, its successors and assigns until
all of the Obligations have been satisfied in full. If any of the present or
future Obligations are guaranteed by persons, partnerships or corporations in
addition to the Guarantor, the death, release or discharge, in whole or in part,
or the bankruptcy, liquidation or dissolution of one or more of them shall not
discharge or affect the liabilities of the Guarantor under this Guarantee.

     No failure on the part of the Holder to exercise, and no delay in
exercising, any right, remedy or power hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise by the Holder of any right,
remedy or power hereunder preclude any other or future exercise of any right,
remedy or power. Each and every right, remedy and power hereby granted to the
Holder or allowed it by law or other agreement shall be cumulative and not
exclusive of any other, and may be exercised by the Holder at any time or from
time to time.

     The Guarantor waives notice of the acceptance of this Guarantee,
presentment to or demand of payment from anyone whomsoever liable upon any of
the Obligations, notice of dishonor, protest, notice of any sale of collateral
security and all other notices whatsoever.

     This Guarantee is issued subject to the provisions of the Indenture, dated
November 9, 2007 among AIG Program Funding, Inc., American International Group,
Inc. and The Bank of New York, as Trustee, and each Holder, by accepting the
Security upon which this Guarantee is endorsed, agrees to and shall be bound by
such provisions.

     This Guarantee shall not be valid or obligatory for any purpose until the
certificate of authentication on the Security upon which this Guarantee is
endorsed shall have been executed by the Trustee under the Indenture by manual
signature.

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


                                       -6-

<PAGE>

     IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be duly
executed.

                                        AMERICAN INTERNATIONAL GROUP, INC.


                                        By:
                                            ------------------------------------
                                        Name: Robert A. Gender
                                        Title: Vice President and Treasurer


                                        Attest:
                                                --------------------------------
                                        Name: Kathleen E. Shannon
                                        Title: Senior Vice President and
                                               Secretary


                                       -7-

<PAGE>

                            AIG PROGRAM FUNDING, INC.

         FLOATING RATE MEDIUM-TERM NOTES, SERIES [A (PF)] [AIG-FP (PF)]
                      [MP, MATCHED INVESTMENT PROGRAM (PF)]

                     FULLY AND UNCONDITIONALLY GUARANTEED BY
                       AMERICAN INTERNATIONAL GROUP, INC.

     This Security is one of a duly authorized issue of securities of the
Company, issued and to be issued in one or more series under an Indenture, dated
as of November 9, 2007 (herein called the "Indenture"), among the Company,
American International Group, Inc., as guarantor (the "Guarantor") and The Bank
of New York, as trustee (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, limitations of rights, duties and immunities thereunder of the Company,
the Trustee and the Holders of the Securities and the terms upon which the
Securities are, and are to be, authenticated and delivered. This Security is one
of the series designated on the face hereof (herein called the "Securities",
which is limited in aggregate principal amount to [__________].

     The rate of interest on this Security will be reset daily, weekly, monthly,
quarterly, semi-annually, annually or otherwise, as specified on the face hereof
under Interest Rate Reset Period (each date upon which interest is so reset as
provided below being hereinafter referred to as an "Interest Reset Date").
Unless otherwise specified on the face hereof, the Interest Reset Date with
respect to this Security will be as follows: if the Interest Rate Reset Period
specified on the face hereof is daily, each Business Day; if the Interest Rate
Reset Period specified on the face hereof is weekly (for Securities using an
Interest Rate Basis, as specified on the face hereof, other than the Treasury
Rate), Wednesday of each week; if the Interest Rate Reset Period specified on
the face hereof is weekly and the Interest Rate Basis specified on the face
hereof is the Treasury Rate, except as otherwise provided in the definition of
Treasury Interest Determination Date under "Determination of Treasury Rate"
below, the Tuesday of each week; if the Interest Rate Reset Period specified on
the face hereof is monthly, the third Wednesday of each month; if the Interest
Rate Reset Period specified on the face hereof is quarterly, the third Wednesday
of each March, June, September and December; if the Interest Rate Reset Period
specified on the face hereof is semi-annually, the third Wednesday of each of
the two months specified on the face hereof; and if the Interest Rate Reset
Period specified on the face hereof is annually, the third Wednesday of the
month specified on the face hereof; provided, however, that (i) the interest
rate in effect from the date of issue to the first Interest Reset Date will be
the Initial Interest Rate specified on the face hereof and (ii) except as
otherwise specified on the face hereof, if the Interest Rate Reset Period on the
face hereof is daily or weekly, the interest rate in effect for each day
following the second Business Day prior to an Interest Payment Date to, but
excluding, such Interest Payment Date, and for each day following the second
Business Day prior to the maturity date, shall be the rate in effect on such
second Business Day. If, pursuant to the preceding sentence, any Interest Reset
Date would otherwise be a day that is not a Business Day with respect to this
Security, the Interest Reset Date shall be the next succeeding day that is a
Business Day with respect to this Security, except that, unless otherwise
specified on the face hereof, if the Interest Rate Basis specified on the face
hereof is LIBOR and the next succeeding

                  (Reverse of Security continued on next page)


                                       -8-

<PAGE>

Business Day falls in the next succeeding calendar month, such Interest Reset
Date shall be the immediately preceding Business Day.

     Subject to applicable provisions of law and except as specified herein, on
each Interest Reset Date, the rate of interest on this Security shall be the
rate determined in accordance with the provisions of the applicable heading
below.

     "Euro Business Day" means any day on which the Trans-European Automated
Real-Time Gross Settlement Express Transfer (TARGET) System, or any successor
system, is open for business.

     "London Business Day" means any day on which dealings in the relevant
specified currency are transacted in the London interbank market.

     "Business Day" means, for any note, a day that meets all the following
applicable requirements: (i) for all notes, is a Monday, Tuesday, Wednesday,
Thursday or Friday that is not a day on which banking institutions in New York
City generally are authorized or obligated by law, regulation or executive order
to close, (ii) if the note is a LIBOR note, is also a London Business Day; (iii)
if the note has a specified currency other than U.S. dollars or euro, is also a
day on which banking institutions are not authorized or obligated by law,
regulation or executive order to close in the principal financial center of the
country issuing the specified currency; and (iv) if the note is EURIBOR note or
has a specified currency of euros, or is a LIBOR note for which the specified
currency is euros, is also a Euro Business Day.

     DETERMINATION OF LIBOR. If the Interest Rate Basis is LIBOR, the Interest
Rate Basis that takes effect on any Interest Reset Date shall be LIBOR on the
corresponding LIBOR Interest Determination Date (as defined below) and shall be
determined in accordance with the following provisions:

     LIBOR will be either the offered rate appearing on Reuters Screen LIBOR01
(as defined below) or the arithmetic mean of the offered rates appearing on
Reuters Screen LIBO (as defined below) unless that page by its terms cites only
one rate, in which case that one rate, in either case, as of 11:00 A.M., London
time, on such LIBOR Interest Determination Date, for deposits of the Specified
Currency having the Index Maturity beginning on such Interest Reset Date.

     If Reuters Screen LIBOR01 applies and the rate described above does not
appear on that page, or if Reuters Screen LIBO applies and fewer than two of the
relevant rates appear on that page or no rate appears on any page on which only
one rate normally appears, then LIBOR will be determined on the basis of the
rates, at approximately 11:00 A.M., London time, on such LIBOR Interest
Determination Date, at which deposits of the Specified Currency having the Index
Maturity beginning on such Interest Reset Date, and in a Representative Amount
(as defined below) are offered to prime banks in the London interbank market by
four major banks in that market selected by the Calculation Agent. The
Calculation Agent will request the principal London office of each of these
banks to provide a quotation of its rate if at least two such quotations are
provided, LIBOR for such LIBOR Interest Determination Date will be the
arithmetic mean of such quotations.

     If fewer than two quotations are provided as described above, LIBOR for
such LIBOR Interest Determination Date will be the arithmetic mean of the rates
for loans of the Specified Currency having the Index Maturity, beginning on such
Interest Reset Date, and in a Representative Amount to leading European banks
quoted, at approximately 11:00 A.M., in the

                  (Reverse of Security continued on next page)


                                       -9-

<PAGE>

principal financial center for the country of the Specified Currency, on such
LIBOR Interest Determination Date, by three major banks in that financial center
selected by the Calculation Agent.

     If fewer than three banks selected by the Calculation Agent are quoting as
described above LIBOR for the new Interest Rate Reset Period will be LIBOR in
effect for the prior Interest Rate Reset Period. If the Initial Interest Rate
has been in effect for the prior Interest Rate Reset Period, however, it will
remain in effect for the new Interest Rate Reset Period.

     The Interest Rate Basis determined in accordance with the foregoing
provisions will be adjusted by the addition or subtraction of the Spread, if
any, or by multiplying such Interest Rate Basis by the Spread Multiplier, if
any.

     "LIBOR Interest Determination Date" means, in relation to a particular
Interest Reset Date, the second London Business Day preceding such Interest
Reset Date, unless the Specified Currency is pounds sterling, Australian
dollars, Canadian dollars, or New Zealand dollars, in which case the LIBOR
Interest Determination Date will be the Interest Reset Date.

     "Representative Amount" means an amount that, in the Calculation Agent's
judgment, is representative of a single transaction in the relevant market at
the relevant time.

     "Reuters Screen LIBO" means the display on the Reuters service, or any
successor or replacement service, on the page designated as "LIBO" or any
replacement page or pages on which London interbank rates of major banks for the
relevant specified currency are displayed.

     "Reuters Screen LIBOR01" means the display on the Reuters service, or any
successor or replacement service, on the page designated as "LIBOR01" or any
replacement page or pages on which London interbank rates of major banks for the
relevant specified currency are displayed.

     DETERMINATION OF EURIBOR. If the Interest Rate Basis is EURIBOR, the
Interest Rate Basis that takes effect on any Interest Reset Date shall equal the
interest rate for deposits in euros designated as "EURIBOR" and sponsored
jointly by the European Banking Federation and ACI - the Financial Market
Association (or any company established by the joint sponsors for purposes of
compiling and publishing that rate) on the corresponding EURIBOR Interest
Determination Date (as defined below), and shall be determined in accordance
with the following procedures:

     EURIBOR will be the offered rate for deposits in euros having the Index
Maturity beginning on the Interest Reset Date after such EURIBOR Interest
Determination Date, as that rate appears on Reuters Screen EURIBOR01 as of 11:00
A.M., Brussels time, on such EURIBOR Interest Determination Date.

     If the rate described above does not appear on Reuters Screen EURIBOR01,
EURIBOR will be determined on the basis of the rates, at approximately 11:00
A.M., Brussels time, on such EURIBOR Interest Determination Date, at which euro
deposits having the Index Maturity, beginning on the Interest Reset Date, and in
a Representative Amount are offered to prime banks in the Euro-zone (as defined
below) interbank market by the principal Euro-zone office of each of four major
banks in that market selected by the Calculation Agent. The Calculation Agent
will request the principal Euro-zone office of each of these banks to provide a
quotation of its rate. If at least two quotations are provided, EURIBOR for the
relevant EURIBOR interest determination date will be the arithmetic mean of the
quotations.

                  (Reverse of Security continued on next page)


                                      -10-

<PAGE>

     If fewer than two quotations are provided as described above EURIBOR for
such EURIBOR Interest Determination Date will be the arithmetic mean of the
rates for euro loans having the Index Maturity, beginning on the Interest Reset
Date, and in a Representative Amount to leading Euro-zone banks quoted, at
approximately 11:00 A.M., Brussels time on such EURIBOR Interest Determination
Date, by three major banks in the Euro-zone selected by the Calculation Agent.

     If fewer than three banks selected by the Calculation Agent are quoting as
described above, EURIBOR for the new Interest Rate Reset Period will be EURIBOR
in effect for the prior Interest Rate Reset Period. If the Initial Interest Rate
has been in effect for the prior Interest Rate Reset Period, however, it will
remain in effect for the new Interest Rate Reset Period.

     The Interest Rate Basis determined in accordance with the foregoing
provisions will be adjusted by the addition or subtraction of the Spread, if
any, or by multiplying such Interest Rate Basis by the Spread Multiplier, if
any.

     "EURIBOR Interest Determination Date" means, in relation to a particular
Interest Reset Date, the second TARGET Settlement Day preceding such Interest
Reset Date.

     "Euro-zone" means, at any time, the region comprised of the member states
of the European Economic and Monetary Union that, as of that time, have adopted
a single currency in accordance with the Treaty on European Union of February
1992, as amended.

     "Reuters Screen EURIBOR01" means the display on the Reuters service, or any
successor or replacement service, on the page designated as "EURIBOR01" or any
replacement page or pages on which EURIBOR rates are displayed.

     "Target Settlement Day" means a day on which the Trans-European Automated
Real-Time Gross Settlement Express Transfer ("TARGET") System, or any successor
system is open for business.

     DETERMINATION OF TREASURY RATE. If the Interest Rate Basis is the Treasury
Rate, the Interest Rate Basis that takes effect on any Interest Reset Date shall
equal the rate for the auction on the corresponding Treasury Interest
Determination Date (as defined below) of direct obligations of the United States
("Treasury Bills") having the Index Maturity, as that rate appears on Reuters
Screen USAUCTION10 or USAUCTION11 under the heading "Investment Rate". If the
Treasury Rate cannot be determined in this manner, the following procedures will
apply in determining the Treasury Rate:

     If the rate described above does not appear on either page at 3:00 P.M.,
New York City time, on the Calculation Date corresponding to such Treasury
Interest Determination Date (unless the calculation is made earlier and the rate
is available from that source at that time), the Treasury Rate will be the Bond
Equivalent Yield (as defined below) of the rate, for such Treasury Interest
Determination Date, for the type of Treasury Bills described above, as published
in H.15 Daily Update (as defined below), or another recognized electronic source
used for displaying that rate, under the heading "U.S. Government
Securities/Treasury Bills/Auction High".

     If the rate described in the prior paragraph does not appear in H.15 Daily
Update or another recognized electronic source by 3:00 P.M., New York City time,
on such Calculation Date (unless the calculation is made earlier and the rate is
available from one of those sources at that time), the Treasury Rate will be the
Bond Equivalent Yield of the auction rate, for such Treasury

                  (Reverse of Security continued on next page)


                                      -11-

<PAGE>

Interest Determination date and for Treasury Bills of the kind described above,
as announced by the U.S. Department of the Treasury.

     If the auction rate described in the prior paragraph is not so announced by
3:00 P.M., New York City time, on such Calculation Date, or it no such auction
is held for the relevant week, then the Treasury Rate will be the Bond
Equivalent Yield of the rate, for such Treasury Interest Determination Date and
for Treasury Bills having a remaining maturity closest to the Index Maturity, as
published in H.15 (519) (as defined below) under the heading "U.S. Government
Securities/Treasury Bills/Secondary Market".

     If the rate described in the prior paragraph does not appear in H.15(519)
by 3:00 P.M., New York City time, on such Calculation Date unless the
calculation is made earlier and the rate is available from one of those sources
at that time), then the Treasury Rate will be the rate, for such Treasury
Interest Determination Date and for Treasury Bills having a remaining maturity
closest to the Index Maturity, as published in H.15 Daily Update, or another
recognized electronic source used for displaying that rate, under the heading
"U.S. Government Securities/Treasury Bills/Secondary Market".

     If the rate described in the prior paragraph does not appear in H.15 Daily
Update or another recognized electronic source by 3:00 P.M., New York City time,
on such Calculation Date (unless the calculation is made earlier and the rate is
available from one of those sources at that time), the Treasury Rate will be the
Bond Equivalent Yield of the arithmetic mean of the secondary market bid rates
as of approximately 3:30 P.M., New York City time, on such Treasury Interest
Determination Date, by three primary U.S. government securities dealers in New
York City selected by the Calculation Agent for the issue of Treasury Bills with
a remaining maturity closest to the Index Maturity.

     If fewer than three dealers selected by the Calculation Agent are quoting
as described in the prior paragraph, the Treasury Rate in effect for the new
Interest Rate Reset Period will be the Treasury Rate in effect for the prior
Interest Rate Reset Period. If the Initial Interest Rate has been in effect for
the prior Interest Rate Reset Period, however, it will remain in effect for the
new Interest Rate Reset Period.

     The Interest Rate Basis determined in accordance with the foregoing
provisions will be adjusted by the addition or subtraction of the Spread, if
any, or by multiplying such Interest Rate Basis by the Spread Multiplier, if
any.

     "Bond Equivalent Yield" means a yield expressed as a percentage and
calculated in accordance with the following formula:

                                               D x N
                   bond equivalent yield = ------------- x 100
                                           360 - (D x M)

     where "D" means the annual rate for Treasury Bills quoted on a bank
discount basis and expressed as a decimal; "N" means 365 or 366, as the case may
be; and "M" means the actual number of days in the applicable Interest Reset
Period.

     "H.15(519)" means the weekly statistical release entitled "Statistical
Release H.15(519)", or any successor publication, published by the Board of
Governors of the Federal Reserve System.

                  (Reverse of Security continued on next page)


                                      -12-

<PAGE>

     "H.15 Daily Update" means the daily update of H.15(519) available through
the worldwide-web site of the Board of Governors of the Federal Reserve System,
at http://www.federalreserve.gov/releases/h15/Update, or any successor site or
publication.

     "Reuters Screen USAUCTION10 or USAUCTION11" means the display on the
Reuters service, or any successor or replacement service, on the page designated
as "USAUCTION10" or "USAUCTION11" or any replacement page or pages on which U.S.
Treasury auction rates are displayed.

     "Treasury Interest Determination Date" means the day of the week in which
the Interest Reset Date falls on which Treasury Bills would normally be
auctioned. If as the result of a legal holiday an auction is held on the
preceding Friday, that Friday will be the Treasury Interest Determination Date
relating to the Interest Reset Date occurring in the next succeeding week. If
the auction is held on a day that would otherwise be an Interest Reset Date,
then the Interest Reset Date will instead be the first Business Day following
the auction date.

     DETERMINATION OF CMT RATE. If the Interest Rate Basis is the CMT Rate, the
Interest Rate Basis that takes effect on any Interest Reset Date shall equal the
CMT Rate on the CMT Interest Determination Date (as defined below). "CMT Rate"
means the following rate displayed on the Designated CMT Reuters Page (as
defined below) under the Heading "...Treasury Constant Maturities...Federal
Reserve Board Release H.15...Mondays Approximately 3:45 P.M.", under the column
for the Designated CMT Index Maturity (as defined below):

     (x) if the Designated CMT Reuters Page is Reuters Screen FRBCMT, the rate
for such CMT Interest Determination Date; or

     (y) if the Designated CMT Reuters Page is Reuters Screen FEDCMT, the weekly
or monthly average, as specified on the face hereof, for the week that ends
immediately before the week in which such CMT Interest Determination Date falls,
or for the month that ends immediately before the month in which such CMT
Interest Determination Date falls, as applicable.

     If the CMT Rate cannot be determined in this manner, the following
procedures will apply in determining the CMT Rate.

     If the applicable rate described above is not displayed on the relevant
Designated CMT Reuters Page at 3:00 P.M., New York City time, on the Calculation
Date corresponding to such CMT Interest Determination Date (unless the
calculation is made earlier and the rate is available from one of those sources
at that time), then the CMT Rate will be the applicable Treasury constant
maturity rate described above as published in H.15(519).

     If the applicable rate described above does not appear in H.15(519) by 3:00
P.M., New York City time, on such Calculation Date (unless the calculation is
made earlier and the rate is available from one of those sources at that time),
then the CMT Rate will be the Treasury constant maturity rate, or other U.S.
Treasury rate, for the Designated CMT Index Maturity and with reference to such
CMT Interest Determination Date, that:

     (i) is published by the Board of Governors of the Federal Reserve System,
or the U.S. Department of the Treasury; and

     (ii)is determined by the Calculation Agent to be comparable to the
applicable rate formerly displayed on the Designated CMT Reuters Page and
published in H.15(519).

                  (Reverse of Security continued on next page)


                                      -13-

<PAGE>

     If the rate described above does not appear by 3:00 P.M., New York City
time, on such Calculation Date (unless the calculation is made earlier and the
rate is available from one of those sources at that time), then the CMT Rate
will be the yield to maturity of the arithmetic mean of secondary market offered
rates as of approximately 3:30 P.M., New York City time, on such CMT Interest
Determination Date, of three primary U.S. government securities dealers in New
York City selected by the Calculation Agent for the most recently issued direct,
non-callable, fixed rate obligations of the U.S. government ("Treasury Notes")
having an original maturity of approximately the Designated CMT Index Maturity
and a remaining term to maturity of not less than the Designated CMT Index
Maturity minus one year and in a Representative Amount. In selecting such
offered rates, the Calculation Agent will request quotations from five such
primary dealers and will disregard the highest quotation - or, if there is
equality, one of the highest - and the lowest quotation - or, if there is
equality, one of the lowest.

     If the Calculation Agent is unable to obtain three quotations of the kind
described in the prior paragraph, the CMT Rate will be the yield to maturity of
the arithmetic mean of secondary market offered rates as of approximately 3:30
P.M., New York City time, on such CMT Interest Determination Date, of three
primary U.S. government securities dealers in New York City selected by the
Calculation Agent for Treasury Notes with an original maturity longer than the
Designated CMT Index Maturity, with a remaining term to maturity closest to the
Designated CMT Index Maturity and in a Representative Amount. In selecting such
offered rates, the Calculation Agent will request quotations from five such
primary dealers and will disregard the highest quotation - or, if there is
equality, one of the highest - and the lowest quotation - or, if there is
equality, one of the lowest. If two Treasury Notes with an original maturity
longer than the Designated CMT Index Maturity have remaining terms to maturity
that are equally close to the Designated CMT Index Maturity, the Calculation
Agent will obtain quotations for the Treasury Note with the shorter remaining
term to maturity.

     If fewer than five but more than two such primary dealers are quoting as
described in the prior paragraph the CMT Rate for such CMT Interest
Determination Date will be based on the arithmetic mean of the offered rates so
obtained, and neither the highest nor the lowest of those quotations will be
disregarded.

     If two or fewer primary dealers selected by the Calculation Agent are
quoting as described above the CMT Rate in effect for the new Interest Rate
Reset Period will be the CMT Rate in effect for the prior Interest Rate Reset
Period. If the Initial Interest Rate has been in effect for the prior Interest
Rate Reset Period, however, it will remain in effect for the new Interest Rate
Reset Period.

     The Interest Rate Basis determined in accordance with the foregoing
provisions will be adjusted by the addition or subtraction of the Spread, if
any, or by multiplying such Interest Rate Basis by the Spread Multiplier, if
any.

     "CMT Interest Determination Date" means, in relation to a particular
Interest Reset Date, the second Business Day immediately preceding such Interest
Reset Date.

     "Designated CMT Index Maturity" means the Index Maturity specified on the
face hereof and will be the original period to maturity of a U.S. Treasury
security - specified on the face hereof, provided that, if no such original
maturity period is so specified, the Designated CMT Index Maturity will be 2
years.

                  (Reverse of Security continued on next page)


                                      -14-

<PAGE>

     "Designated CMT Reuters Page" means the Reuters Screen specified on the
face hereof that displays Treasury constant maturities as reported in H.15(519);
provided, however, that, if no Reuters Screen is so specified, then the
applicable page will be Reuters Screen FEDCMT, and provided further, that if
Reuters Screen FEDCMT applies but it is not specified on the face hereof whether
the weekly or monthly average applies, the weekly average will apply.

     "Reuters Screen FEDCMT" means the display on the Reuters service, or any
successor or replacement service, on the page designated as "FEDCMT" or any
replacement page or pages on which CMT rates are displayed.

     "Reuters Screen FRBCMT" means the display on the Reuters service, or any
successor or replacement service, on the page designated as "FRBCMT" or any
replacement page or pages on which CMT rates are displayed.

     DETERMINATION OF COMMERCIAL PAPER RATE. If the Interest Rate Basis is the
Commercial Paper Rate, the Interest Rate Basis that takes effect on any Interest
Reset Date shall equal the Money Market Yield (as defined below) of the discount
rate, for the Commercial Paper Interest Determination Date (as defined below),
for U.S. dollar denominated commercial paper having the Index Maturity specified
on the face hereof, as published in H.15(519) under the heading "Commercial
Paper - Non-financial". If the Commercial Paper Rate cannot be determined in
this manner, the following procedures will apply in determining the Commercial
Paper Rate:

     If the rate described above does not appear in H.15(519) by 3:00 P.M., New
York City time, on the Calculation Date corresponding to such Commercial Paper
Interest Determination Date (unless the calculation is made earlier and the rate
is available from that source at that time), then the Commercial Paper Rate will
be the Money Market Yield of the discount rate, for such Commercial Paper
Interest Determination Date, for commercial paper having the Index Maturity
specified on the face hereof, as published in H.15 Daily Update or any other
recognized electronic source used for displaying that rate, under the heading
"Commercial Paper - Non-financial".

     If the rate described above does not appear in H.15(519), H.15 Daily Update
or another recognized electronic source by 3:00 P.M., New York City time, on
such Calculation Date (unless the calculation is made earlier and the rate is
available from one of those sources at that time), the Commercial Paper Rate
will be the Money Market Yield of the arithmetic mean of the offered rates as of
11:00 A.M., New York City time, on such Commercial Paper Interest Determination
Date, by three leading U.S. dollar commercial paper dealers in New York City
selected by the Calculation Agent for U.S. dollar commercial paper that has the
Index Maturity and is placed for an industrial issuer whose bond rating is "AA",
or the equivalent, from a nationally recognized rating agency.

     If fewer than three dealers selected by the Calculation Agent are quoting
as described above, the Commercial Paper Rate for the new Interest Rate Reset
Period will be the Commercial Paper Rate in effect for the prior Interest Rate
Reset Period. If the Initial Interest Rate has been in effect for the prior
Interest Rate Reset Period, however, it will remain in effect for the new
Interest Rate Reset Period.

     The Interest Rate Basis determined in accordance with the foregoing
provisions will be adjusted by the addition or subtraction of the Spread, if
any, or by multiplying such Interest Rate Basis by the Spread Multiplier, if
any.

                  (Reverse of Security continued on next page)


                                      -15-

<PAGE>

     "Commercial Paper Interest Determination Date" means, in relation to a
particular Interest Reset Date, the second Business Day immediately preceding
such Interest Reset Date.

     "Money Market Yield" means a yield expressed as a percentage and calculated
in accordance with the following formula:

                                            D x 360
                    money market yield = ------------- x 100
                                         360 - (D x M)

     where "D" means the annual rate for commercial paper quoted on a bank
discount basis and expressed as a decimal; and "M" means the actual number of
days in the applicable Interest Reset Period.

     DETERMINATION OF PRIME RATE. If the Interest Rate Basis is the Prime Rate,
the Interest Rate Basis that takes effect on any Interest Reset Date shall equal
the rate, for the Prime Interest Determination Date (as defined below),
published in H.15(519) under the heading "Bank Prime Loan". If the Prime Rate
cannot be determined in this manner, the following procedures will apply in
determining the Prime Rate:

     If the rate described above does not appear in H.15(519) by 3:00 P.M., New
York City time on the Calculation Date corresponding to such Prime Interest
Determination Date (unless the calculation is made earlier and the rate is
available from that source at that time), then the Prime Rate will be the rate,
for such Interest Determination Date, as published in H.15 Daily Update or
another recognized electronic source used for the purpose of displaying that
rate, under the heading "Bank Prime Loan".

     If the rate described above is not published in H.15(519), H.15 Daily
Update or another recognized electronic source by 3:00 P.M., New York City time,
on such Calculation Date (unless the calculation is made earlier and the rate is
available from one of those sources at that time), then the Prime Rate will be
the arithmetic mean of the rates of interest publicly announced by each bank
appearing on that page as that bank's prime rate or base lending rate, as of
11:00 A.M., New York City time, on such Prime Interest Determination Date as
they appear on the Reuters Screen US PRIME 1 Page (as defined below).

     If fewer than four of the rates referred to above appear on the Reuters
Screen US PRIME 1 Page, the Prime Rate will be the arithmetic mean of the prime
rates or base lending rates, as of the close of business on such Prime Interest
Determination Date, of three major banks in New York City selected by the
Calculation Agent. For this purpose, the Calculation Agent will use rates quoted
on the basis of the actual number of days in the year divided by a 360-day year.

     If fewer than three banks selected by the Calculation Agent are quoting as
described above, the Prime Rate for the new Interest Rate Reset Period will be
the Prime Rate in effect for the prior Interest Rate Period. If the Initial
Interest Rate has been in effect for the prior Interest Rate Reset Period,
however, it will remain in effect for the new Interest Rate Reset Period.

     The Interest Rate Basis determined in accordance with the foregoing
provisions will be adjusted by the addition or subtraction of the Spread, if
any, or by multiplying such Interest Rate Basis by the Spread Multiplier, if
any.

                  (Reverse of Security continued on next page)


                                      -16-

<PAGE>

     "Prime Interest Determination Date" means, in relation to a particular
Interest Reset Date, the first Business Day immediately preceding such Interest
Reset Date.

     "Reuters Screen US PRIME 1 Page" means the display on the "US PRIME 1" page
on the Reuters service, or any successor or replacement service, or any
replacement page or pages on that service, for the purpose of displaying prime
rates or base lending rates of major U.S. banks.

     DETERMINATION OF CD RATE. If the Interest Rate Basis is the CD Rate, the
Interest Rate Basis that takes effect on any Interest Reset Date shall equal the
rate, on the CD Interest Determination Date (as defined below), for negotiable
U.S. dollar certificates of deposit having the Specified Index Maturity as
published in H.15(519) under the heading "CDs (Secondary Market)". If the CD
Rate cannot be determined in this manner, the following procedures will apply in
determining the CD Rate:

     If the rate described above does not appear published in H.15(519) by 3:00
P.M., New York City time, on the Calculation Date corresponding to such CD
Interest Determination Date, then the CD Rate will be the rate, for such CD
Interest Determination Date, as published in H.15 Daily Update, or another
recognized electronic source used for displaying that rate, under the heading
"CDs (Secondary Market)".

     If the rate described above does not appear in H.15(519), H.15 Daily Update
or another recognized electronic source by 3:00 P.M., New York City time, on
such Calculation Date (unless the calculation is made earlier and the rate is
available from one of those sources at that time), the CD Rate will be the
arithmetic mean of the secondary market offered rates as of 10:00 A.M., New York
City time, on such CD Determination Date, by three leading nonbank dealers in
negotiable U.S. dollar certificates of deposit in New York City, as selected by
the Calculation Agent for negotiable U.S. dollar certificates of deposit of
major U.S. money center banks with a remaining maturity closest to the Index
Maturity, and in a Representative Amount.

     If fewer than three dealers selected by the Calculation Agent are quoting
as described above, the CD Rate in effect for the new Interest Rate Reset Period
will be the CD Rate in effect for the prior Interest Rate Reset Period. If the
Initial Interest Rate has been in effect for the prior Interest Rate Reset
Period, however, it will remain in effect for the new Interest Rate Reset
Period.

     The Interest Rate Basis determined in accordance with the foregoing
provisions will be adjusted by the addition or subtraction of the Spread, if
any, or by multiplying such Interest Rate Basis by the Spread Multiplier, if
any.

     "CD Interest Determination Date" means, in relation to a particular
Interest Reset Date, the second Business Day immediately preceding such Interest
Reset Date.

     DETERMINATION OF FEDERAL FUNDS EFFECTIVE RATE. If the Interest Rate Basis
is the Federal Funds Effective Rate, the Interest Rate Basis that takes effect
on any Interest Reset Date shall equal the rate, on the Federal Funds Interest
Determination Date (as defined below), for U.S. dollar federal funds, as
published in H.15(519) under the heading "EFFECT", as that rate is displayed on
Reuters Screen FEDFUNDS1. If the Federal Funds Effective Rate cannot be
determined in this manner, the following procedures will apply in determining
the Federal Funds Effective Rate:

                  (Reverse of Security continued on next page)


                                      -17-

<PAGE>

     If the rate described above is not displayed on Reuters Screen FEDFUNDS1 at
3:00 P.M., New York City time, on the Calculation Date corresponding to such
Federal Funds Interest Determination Date (unless the calculation is made
earlier and the rate is available from that source at that time), then the
Federal Funds Effective Rate will be the rate, for such Federal Funds Interest
Determination Date, described above as published in H.15 Daily Update, or
another recognized electronic source used for displaying that rate, under the
heading "Federal Funds (Effective)".

     If the rate described in the preceding paragraph is not displayed on
Reuters Screen FEDFUNDS1 and does not appear in H.15(519), H.15 Daily Update or
another recognized electronic source by 3:00 P.M., New York City time, on such
Calculation Date (unless the calculation is made earlier and the rate is
available from one of those sources at that time), the Federal Funds Effective
Rate will be the arithmetic mean of the rates for the last transaction in
overnight, U.S. dollar federal funds arranged, before 9:00 A.M., New York City
time, on such Federal Funds Interest Determination Date, by three leading
brokers of U.S. dollar federal funds transactions in New York City selected by
the Calculation Agent.

     If fewer than three brokers selected by the Calculation Agent are quoting
as described in the preceding paragraph, the Federal Funds Effective Rate in
effect for the new Interest Rate Reset Period will be the Federal Funds
Effective Rate in effect for the prior Interest Rate Reset Period. If the
Initial Interest Rate has been in effect for the prior Interest Rate Reset
Period, however, it will remain in effect for the new Interest Rate Reset
Period.

     The Interest Rate Basis determined in accordance with the foregoing
provisions will be adjusted by the addition or subtraction of the Spread, if
any, or by multiplying such Interest Rate Basis by the Spread Multiplier, if
any.

     "Federal Funds Interest Determination Date" means, in relation to a
particular Interest Reset Date, the first Business Day immediately preceding
such Interest Reset Date.

     "Reuters Screen FEDFUNDS1" means the display on the Reuters service, or any
successor or replacement service, on the page designated as "FEDFUNDS1" or any
replacement page or pages on which U.S. dollar federal funds rates are
displayed.

     DETERMINATION OF FEDERAL FUNDS OPEN RATE. If the Interest Rate Basis is the
Federal Funds Open Rate, the Interest Rate Basis shall equal the opening rate on
the Federal Funds Interest Determination Date for United States dollar federal
funds as displayed under the heading "Federal Funds" and opposite the caption
"Open" on Reuters Screen RTRTSY1.

     If the rate described above does not appear on Reuters Screen RTRTSY1 by
3:00 P.M., New York City time, on the Calculation Date, then the Federal Funds
Open Rate will be the opening rate on the Federal Funds Interest Determination
Date for United States dollar federal funds as displayed on the FEDFOPEN Index
on Bloomberg, which is the Fed Funds Opening Rate as reported by Garban Capital
Markets (or a successor) on Bloomberg.

     If the rate described in the preceding paragraph does not appear on
FEDFOPEN Index on Bloomberg by 3:00 P.M., New York City time, on the Calculation
Date, then the Federal Funds Open Rate will be the rate calculated by the
Calculation Agent as the arithmetic mean of the rates for the last transaction
in overnight U.S. dollar federal funds arranged before 9:00 A.M., New York City
time, on the Federal Funds Interest Determination Date by three leading brokers

                  (Reverse of Security continued on next page)


                                      -18-

<PAGE>

of United States dollar federal funds transactions in The City of New York
selected by the Calculation Agent.

     If one or more of the brokers selected by the Calculation Agent are not
quoting as mentioned in the preceding paragraph, then the Federal Funds Open
Rate will be the rate in effect for the prior Interest Rate Reset Period. If the
Initial Interest Rate has been in effect for the prior Interest Rate Reset
Period, however, it will remain in effect for the new Interest Rate Reset
Period.

     The Interest Rate Basis determined in accordance with the foregoing
provisions will be adjusted by the addition or subtraction of the Spread, if
any, or by multiplying such Interest Rate Basis by the Spread Multiplier, if
any.

     "Reuters Screen RTRTSY1" means the display on the Reuters service, or any
successor or replacement service, on the page designated as "RTRTSY1" or any
replacement page or pages on which federal funds open rates are displayed.

     DETERMINATION OF 11TH DISTRICT COST OF FUNDS RATE. If the Interest Rate
Basis is the 11th District Cost of Funds Rate, the Interest Rate Basis will be,
with respect to any interest determination date, the rate equal to the monthly
weighted average cost of funds for the calendar month preceding such interest
determination date as set forth under the caption "11TH Dist COFI" on Reuters
Screen COFI/ARMS (or such other page as is specified in your pricing supplement)
as of 11:00 a.m. San Francisco time, on such interest determination date.

     If the rate described above does not appear on Reuters Screen COFI/ARMS,
the 11th District Cost of Funds Rate shall be the monthly weighted average cost
of funds paid by member institutions of the Eleventh Federal Home Loan Bank
District that was most recently announced by the Federal Home Loan Bank of San
Francisco as such cost of funds for the calendar month preceding the date of
such announcement.

     If the Federal Home Loan Bank of San Francisco fails to announce such rate
for the calendar month next preceding such interest determination date, then the
11th District Cost of Funds Rate will be the same as the rate used in the prior
interest period.

     "Reuters Screen COFI/ARMS" means the display on the Reuters service, or any
successor or replacement service, on the page designated as "COFI/ARMS" or any
replacement page or pages on which 11th District cost of funds rates are
displayed.

     The Interest Rate Basis determined in accordance with the foregoing
provisions will be adjusted by the addition or subtraction of the Spread, if
any, or by multiplying such Interest Rate Basis by the Spread Multiplier, if
any.

     Any reference to a particular heading or headings on Designated CMT Reuters
Page, H.15(519), H.15 Daily Update, Reuters Screen COFI/ARMS, Reuters Screen
EURIBOR01, Reuters Screen FEDCMT, Reuters Screen FEDFUNDS1, Reuters Screen
FRBCMT, Reuters Screen USAUCTION10, Reuters Screen USAUCTION11, Reuters Screen
LIBO, Reuters Screen US PRIME 1, Reuters Screen LIBOR01, Reuters Screen RTRTSY1
or Reuters Page, shall include any successor or replacement heading or headings
as determined by the Calculation Agent.

     The "Calculation Date" pertaining to any Treasury Interest Determination
Date, CMT Interest Determination Date, Commercial Paper Interest Determination
Date, Prime Interest Determination Date, CD Interest Determination Date or
Federal Funds Interest Determination

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                                      -19-

<PAGE>

Date, as the case may be, shall be the earlier of (i) the tenth calendar day
after such Interest Determination Date or, if any such day is not a Business
Day, the next succeeding Business Day; and, (ii) the Business Day immediately
preceding the Interest Payment Date or the Maturity, whichever is the day on
which the payment of interest will be due. If LIBOR or EURIBOR is the specified
Interest Rate Basis on the face hereof, LIBOR and EURIBOR will be calculated on
the relevant LIBOR Interest Determination Date or EURIBOR Interest Determination
Date.

     The Calculation Agent's determination of the interest rate on this Security
will be final and binding in the absence of manifest error. In calculating an
Interest Rate Basis, the Calculation Agent may obtain quotations from banks and
dealers that are affiliates of the Calculation Agent and/or the Company.

     All percentages resulting from any calculation with respect to this
Security will be rounded upwards, or downwards, as appropriate, to the next
higher or lower one hundred-thousandth of a percentage point, and all amounts
used in or resulting from such calculations will be rounded to the nearest cent
in the case of U.S. dollars, or to the nearest corresponding hundredth of a
unit, in the case of a currency other than U.S. dollars (with one-half cent or
one-half of a corresponding unit or more being rounded upwards).

     Notwithstanding the foregoing, the interest rate hereon shall not be
greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, shown on the face hereof, and, in any event, the interest
rate hereon shall not be higher than the maximum rate permitted by New York law
as the same may be modified by United States law of general application.

     Accrued Interest hereon from the Original Issue Date or from the last date
to which interest hereon has been paid, as the case may be, shall be an amount
calculated by multiplying the face amount hereof by an accrued interest factor.
Such accrued interest factor shall be computed by adding the interest factors
calculated for each day from the Original Issue Date or from the last date to
which interest shall have been paid or duly provided for, as the case may be, to
but excluding the date for which accrued interest is being calculated. The
interest factor (expressed as a decimal) for each such day shall be computed by
dividing the interest rate (expressed as a decimal) applicable to such day by
(i) 360, in the case of Securities with a LIBOR (other than such Securities with
a LIBOR Interest Rate Basis denominated in sterling), EURIBOR, Commercial Paper,
Prime Rate, CD Rate or Federal Funds Interest Rate Basis, (ii) by 365, in the
case of Securities with a LIBOR Interest Rate Basis denominated in sterling or
(iii) by the actual number of days in the year, in the case of Securities with a
Treasury Rate or CMT Interest Rate Basis.

     The Indenture contains provisions for defeasance at any time of the entire
indebtedness of this Security or certain restrictive covenants and Events of
Default with respect to this Security, in each case upon compliance with certain
conditions set forth in the Indenture.

     If an Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.

     The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company

                  (Reverse of Security continued on next page)


                                      -20-

<PAGE>

and the Trustee with the consent of the Holders of a majority in principal
amount of the Securities at the time Outstanding of each series to be affected.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security 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
Security.

     As provided in and subject to the provisions of the Indenture, the Holder
of this Security shall not have the right to institute any proceeding with
respect to the Indenture or for the appointment of a receiver or trustee or for
any other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.

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

     As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Company in any place where the principal of and any premium and
interest on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities 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.

     The Securities of this series are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiples of $1,000 thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate principal
amount of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.

     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.

                  (Reverse of Security continued on next page)


                                      -21-

<PAGE>

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

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

                  (Reverse of Security continued on next page)


                                      -22-

<PAGE>

                                  ABBREVIATIONS

     The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM -- as tenants in common   UNIF GIFT MIN ACT --  ______ Custodian _______
TEN ENT -- as tenants by the                            (Cust)           (Minor)
           entireties                                  Under Uniform Gifts to
JT TEN  -- as joint tenants with                       Minors Act ______________
           right of survivorship                                     (State)
           and not as tenants in
           common

     Additional abbreviations may also be used though not in the above list.

                                   ----------

     FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto

 PLEASE INSERT SOCIAL SECURITY OR OTHER
      IDENTIFYING NUMBER OF ASSIGNEE

________________________________________

________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE

________________________________________________________________________________
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing _________________________________________________________________
attorney to transfer said Security on the books of the Company, with full power
of substitution in the premises.

Dated:
       ------------------               ----------------------------------------
                                        NOTICE: The signature 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 whatever.