<PAGE>
                                                                     Exhibit 4.1



                             JEFFERIES GROUP, INC.,

                                     Issuer

                                       and

                              THE BANK OF NEW YORK,

                                     Trustee




                                    INDENTURE


                          Dated as of January __, 2002




                                Senior Securities
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                              PAGE

<S>                        <C>                                                                                <C>
ARTICLE I                  Definitions and Other Provisions of General Application..........................     1

         Section 1.01          Definitions..................................................................     1

         Section 1.02          Compliance Certificates and Opinions.........................................     9

         Section 1.03          Form of Documents Delivered to Trustee.......................................     9

         Section 1.04          Acts of Holders; Record Dates................................................    10

         Section 1.05          Notices, Etc., to Trustee and Company........................................    12

         Section 1.06          Notice to Holders; Waiver....................................................    12

         Section 1.07          Conflict with Trust Indenture Act............................................    12

         Section 1.08          Effect of Headings and Table of Contents.....................................    13

         Section 1.09          Successors and Assigns.......................................................    13

         Section 1.10          Separability Clause..........................................................    13

         Section 1.11          Benefits of Indenture........................................................    13

         Section 1.12          Governing Law................................................................    13

         Section 1.13          Legal Holidays...............................................................    14

ARTICLE II                 Security Forms...................................................................    14

         Section 2.01          Forms Generally..............................................................    14

         Section 2.02          Form of Face of Security.....................................................    14

         Section 2.03          Form of Reverse of Security..................................................    16

         Section 2.04          Form of Legend for Global Securities.........................................    20

         Section 2.05          Form of Trustee's Certificate of Authentication..............................    20

ARTICLE III                The Securities...................................................................    21

         Section 3.01          Amount Unlimited; Issuable in Series.........................................    21

         Section 3.02          Denominations................................................................    23

         Section 3.03          Execution, Authentication, Delivery and Dating...............................    23

         Section 3.04          Temporary Securities.........................................................    25

         Section 3.05          Registration, Registration of Transfer and Exchange..........................    25

         Section 3.06          Mutilated, Destroyed, Lost and Stolen Securities.............................    27

         Section 3.07          Payment of Interest; Interest Rights Preserved...............................    27

         Section 3.08          Persons Deemed Owners........................................................    28
</TABLE>

                                       i
<PAGE>
                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
<CAPTION>
                                                                                                              PAGE

<S>                        <C>                                                                                <C>
         Section 3.09          Cancellation.................................................................    29

         Section 3.10          Computation of Interest......................................................    29

         Section 3.11          CUSIP Numbers................................................................    29

ARTICLE IV                 Satisfaction and Discharge.......................................................    29

         Section 4.01          Satisfaction and Discharge of Indenture......................................    29

         Section 4.02          Application of Trust Money...................................................    30

ARTICLE V                  Remedies.........................................................................    31

         Section 5.01          Events of Default............................................................    31

         Section 5.02          Acceleration of Maturity; Rescission and Annulment...........................    32

         Section 5.03          Collection of Indebtedness and Suits for Enforcement by Trustee..............    33

         Section 5.04          Trustee May File Proofs of Claim.............................................    34

         Section 5.05          Trustee May Enforce Claims Without Possession of Securities..................    34

         Section 5.06          Application of Money Collected...............................................    35

         Section 5.07          Limitation on Suits..........................................................    35

         Section 5.08          Unconditional Right of Holders to Receive Principal, Premium and Interest....    36

         Section 5.09          Restoration of Rights and Remedies...........................................    36

         Section 5.10          Rights and Remedies Cumulative...............................................    36

         Section 5.11          Delay or Omission Not Waiver.................................................    36

         Section 5.12          Control by Holders...........................................................    36

         Section 5.13          Waiver of Past Defaults......................................................    37

         Section 5.14          Undertaking for Costs........................................................    37

         Section 5.15          Waiver of Usury, Stay or Extension Laws......................................    37

ARTICLE VI                 The Trustee......................................................................    38

         Section 6.01          Duties of Trustee............................................................    38

         Section 6.02          Rights of Trustee............................................................    39

         Section 6.03          Individual Rights of Trustee.................................................    40

         Section 6.04          Trustee's Disclaimer.........................................................    40

         Section 6.05          Notice of Default............................................................    40

         Section 6.06          Reports by Trustee to Holders................................................    40
</TABLE>

                                       ii
<PAGE>
                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
<CAPTION>
                                                                                                              PAGE

<S>                        <C>                                                                                <C>
         Section 6.07          Compensation and Indemnity...................................................    41

         Section 6.08          Replacement of Trustee.......................................................    42

         Section 6.09          Successor Trustee by Merger, Etc.............................................    43

         Section 6.10          Eligibility; Disqualification................................................    43

         Section 6.11          Preferential Collection of Claims against Company............................    43

ARTICLE VII                Holders' Lists and Reports by Trustee and Company................................    43

         Section 7.01          Company to Furnish Trustee Names and Addresses of Holders....................    43

         Section 7.02          Preservation of Information; Communications to Holders.......................    44

         Section 7.03          Reports by Trustee...........................................................    44

         Section 7.04          Reports by Company...........................................................    44

ARTICLE VIII               Consolidation, Merger, Conveyance, Transfer or Lease.............................    45

         Section 8.01          When Company May Merge, Etc..................................................    45

         Section 8.02          Successor Corporation Substituted............................................    45

ARTICLE IX                 Supplemental Indentures..........................................................    46

         Section 9.01          Supplemental Indentures Without Consent of Holders...........................    46

         Section 9.02          Supplemental Indentures with Consent of Holders..............................    47

         Section 9.03          Execution of Supplemental Indentures.........................................    48

         Section 9.04          Effect of Supplemental Indentures............................................    48

         Section 9.05          Conformity with Trust Indenture Act..........................................    48

         Section 9.06          Reference in Securities to Supplemental Indentures...........................    48

ARTICLE X                  Covenants........................................................................    48

         Section 10.01         Payment of Securities........................................................    48

         Section 10.02         Maintenance of Office or Agency..............................................    49

         Section 10.03         Money for Securities Payments to Be Held in Trust............................    49

         Section 10.04         Corporate Existence..........................................................    50

         Section 10.05         Payment of Taxes and Other Claims............................................    50

         Section 10.06         Compliance Certificate; Notice of Default....................................    51

         Section 10.07         Waiver of Stay, Extension or Usury Laws......................................    51

         Section 10.08         Limitation on Liens..........................................................    52
</TABLE>

                                      iii
<PAGE>
                                TABLE OF CONTENTS
                                   (continued)

<TABLE>
<CAPTION>
                                                                                                              PAGE

<S>                        <C>                                                                                <C>
ARTICLE XI                 Redemption of Securities.........................................................    52

         Section 11.01         Applicability of Article.....................................................    52

         Section 11.02         Election to Redeem; Notice to Trustee........................................    52

         Section 11.03         Selection by Trustee of Securities to Be Redeemed............................    52

         Section 11.04         Notice of Redemption.........................................................    53

         Section 11.05         Deposit of Redemption Price..................................................    53

         Section 11.06         Securities Payable on Redemption Date........................................    54

         Section 11.07         Securities Redeemed in Part..................................................    54

ARTICLE XII                Sinking Funds....................................................................    54

         Section 12.01         Applicability of Article.....................................................    54

         Section 12.02         Satisfaction of Sinking Fund Payments with Securities........................    55

         Section 12.03         Redemption of Securities for Sinking Fund....................................    55

ARTICLE XIII               Redemption upon a Designated Event and a Rating Decline..........................    55
         Section 13.01         Redemption by Holders........................................................    55

         Section 13.02         Redemption by Company........................................................    57

         Section 13.03         Other Provisions.............................................................    57

ARTICLE XIV                Defeasance and Covenant Defeasance...............................................    58

         Section 14.01         Company's Option to Effect Defeasance or Covenant Defeasance.................    58

         Section 14.02         Defeasance and Discharge.....................................................    58

         Section 14.03         Covenant Defeasance..........................................................    58

         Section 14.04         Conditions to Defeasance or Covenant Defeasance..............................    59

         Section 14.05         Deposited Money and U.S. Government Obligations
                                 to be Held in Trust; Other Miscellaneous Provisions .......................    60

         Section 14.06         Reinstatement................................................................    61
</TABLE>

                                       iv
<PAGE>
                             Jefferies Group, Inc.
                 Certain Sections of this Indenture relating to
                 Sections 3.10 through 3.18, inclusive, of the
                          Trust Indenture Act of 1939:

<TABLE>
<CAPTION>
Trust Indenture
Act Section                                                                                         Indenture Section

<S>          <C>                                                                                    <C>
Section 310  (a)(1)     .........................................................................        6.10
             (a)(2)     .........................................................................        6.10
             (a)(3)     .........................................................................        Not Applicable
             (a)(4)     .........................................................................        Not Applicable
             (a)(5)     .........................................................................        6.10
             (b)        .........................................................................        6.08
                        .........................................................................         6.10
             (c)        .........................................................................        Not Applicable
Section 311  (a)        .........................................................................        6.11
             (b)        .........................................................................        6.11
             (c)        .........................................................................         Not Applicable
Section 312  (a)        .........................................................................        7.01
                        .........................................................................        7.02
             (b)        .........................................................................        7.02
             (c)        .........................................................................        7.02
Section 313  (a)         .........................................................................        6.06
                        .........................................................................        7.03
             (b)        .........................................................................        6.06
                        .........................................................................        7.03
             (c)        .........................................................................        6.06
                        .........................................................................        7.03
             (d)        .........................................................................        7.03
Section 314  (a)        .........................................................................        7.04
             (a)(4)     .........................................................................        1.01
                        .........................................................................        10.06
             (b)        .........................................................................        Not Applicable
             (c)(1)     .........................................................................        10.2
             (c)(2)     .........................................................................        10.2
             (c)(3)     .........................................................................        Not Applicable
             (d)        .........................................................................        Not Applicable
             (e)        .........................................................................        10.2
Section 315  (a)        .........................................................................        6.01
             (b)        .........................................................................        6.05
             (c)        .........................................................................        6.01
             (d)        .........................................................................        6.01
             (e)        .........................................................................        5.14
Section 316  (a)        .........................................................................        10.1
             (a)(1)(A)  .........................................................................        5.02
                        .........................................................................        5.12
             (a)(1)(B)  .........................................................................        5.13
             (a)(2)     .........................................................................        Not Applicable
             (b)        .........................................................................        5.08
             (c)        .........................................................................        10.4
Section 317  (a)(1)     .........................................................................        5.03
             (a)(2)     .........................................................................        5.04
             (b)        .........................................................................        10.03
Section 318  (a)        .........................................................................        1.07
</TABLE>

---------------

NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be a
      part of the Indenture.


                                       V
<PAGE>
                  INDENTURE, dated as of January __, 2002, between Jefferies
Group, Inc., a corporation duly organized and existing under the laws of the
State of Delaware (herein called the "Company"), having its principal office at
11100 Santa Monica Boulevard, Los Angeles, California 90025 and The Bank of New
York, a New York banking corporation, as Trustee (herein called the "Trustee").

                             RECITALS OF THE COMPANY

                  The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture provided.

                  All things necessary to make this Indenture a valid and
legally binding agreement of the Company, in accordance with its terms, have
been done.

                   NOW, THEREFORE, THIS INDENTURE WITNESSETH:

                  For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:

                                   ARTICLE I

                        DEFINITIONS AND OTHER PROVISIONS
                             OF GENERAL APPLICATION

Section 1.01 Definitions.

                  For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:

                  (1) the terms defined in this Article have the meanings
         assigned to them in this Article and include the plural as well as the
         singular;

                  (2) all other terms used herein which are defined in the Trust
         Indenture Act, either directly or by reference therein, have the
         meanings assigned to them therein;

                  (3) all accounting terms not otherwise defined herein have the
         meanings assigned to them in accordance with generally accepted
         accounting principles, and, except as otherwise herein expressly
         provided, the term "generally accepted accounting principles" with
         respect to any computation required or permitted hereunder shall mean
         such accounting principles as are generally accepted at the date of
         such computation;

                  (4) the words "Article" and "Section" refer to an Article and
         Section, respectively, of this Indenture;

                                       1
<PAGE>
                  (5) the words "herein", "hereof" and "hereunder" and other
         words of similar import refer to this Indenture as a whole and not to
         any particular Article, Section or other subdivision; and

                  (6) Certain terms used principally in Articles VI, X, XIII,
         and XIV, are defined in those Articles.

                  "Act", when used with respect to any Holder, has the meaning
specified in Section 1.04.

                  "Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.

                  "Attributable Debt" means, as to any particular lease under
which any Person is at the time liable and at any date as of which the amount
thereof is to be determined, the total net amount of rent required to be paid by
such Person under such lease during the remaining primary term thereof,
discounted from the respective due dates thereof to such date at the rate of [10
1/8%] per annum. The net amount of rent required to be paid under any such lease
for any such period shall be the aggregate amount of rent payable by the lessee
with respect to such period after excluding amounts required to be paid on
account of maintenance and repairs, insurance, taxes, assessments, water rates
and similar charges, and after giving appropriate credit for lease payments
payable to such Person by any sublessee. In the case of any lease which is
terminable by the lessee upon the payment of a penalty, such net amount shall
also include the amount of such penalty, but no rent shall be considered as
required to be paid under such lease subsequent to the first date upon which it
may be so terminated.

                  "Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal, state or foreign law for the relief of debtors.

                  "Board of Directors" means either the board of directors of
the Company or any duly authorized committee of that board.

                  "Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Company to have been duly adopted
by the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.

                  "Business Day", when used with respect to any Place of
Payment, means each Monday, Tuesday, Wednesday, Thursday and Friday which is not
a day on which banking institutions in that Place of Payment are authorized or
obligated by law or executive order to close.

                  "Capital Lease Obligation" means, at any time any
determination thereof is made, the amount of the liability in respect of a
capital lease that would at such time be so required to be capitalized on the
balance sheet in accordance with generally accepted accounting principles.

                                       2
<PAGE>
                  "Capital Stock", as applied to the stock of any corporation,
means the capital stock of every class whether now or hereafter authorized,
regardless of whether such capital stock shall be limited to a fixed sum or
percentage with respect to the rights of the holders thereof to participate in
dividends and in the distribution of assets upon the voluntary or involuntary
liquidation, dissolution or winding up of such corporation.

                  "Commission" means the Securities and Exchange Commission,
from time to time constituted, created under the Exchange Act or, if at any time
after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.

                  "Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.

                  "Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman of the Board, any
Vice Chairman of the Board, its President or a Vice President, and by its
Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and
delivered to the Trustee.

                  "Consolidated Net Worth" means, with respect to any Person as
of any date, the sum of (i) the consolidated equity of the common stockholders
of such Person and its Subsidiaries as of such date plus (ii) the respective
amounts reported on such Person's balance sheet as of such date with respect to
any series of preferred stock (other than Disqualified Stock) that by its terms
is not entitled to the payment of dividends unless such dividends may be
declared and paid only out of net earnings in respect of the year of such
declaration and payment, but only to the extent of any cash received by such
Person upon issuance of such preferred stock.

                  "Corporate Trust Office" means the principal office of the
Trustee in New York, New York at which at any particular time its corporate
trust business shall be administered, which office as of the date hereof is
located at 5 Penn Plaza, 13th Floor, New York, NY 10001.

                  "Corporation" means a corporation, association, company,
joint-stock company or business trust.

                  "Covenant Defeasance" has the meaning specified in Section
14.03.

                  "Defaulted Interest" has the meaning specified in Section
3.07.

                  "Defeasance" has the meaning specified in Section 14.02.

                  "Defeasible Series" has the meaning specified in Section
14.01.

                  "Depositary" means, with respect to Securities of any series
issuable in whole or in part in the form of one or more Global Securities, a
clearing agency registered under the Exchange Act that is designated to act as
Depositary for such Securities as contemplated by Section 3.01.

                                       3
<PAGE>
                  "Designated Event" has the meaning specified in Section 13.01.

                  "Disqualified Stock" means any Capital Stock which by its
terms (or by the terms of any security into which it is convertible of for which
it is exchangeable), or upon the happening of any event, matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
redeemable at the option of the Holder thereof, in whole or in part, on or prior
to the final date of maturity of the Securities.

                  "Event of Default" has the meaning specified in Section 5.01.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any statute successor thereto.

                   "Global Security" means a Security that evidences all or part
of the Securities of any series and is authenticated and delivered to, and
registered in the name of, the Depositary for such Securities or a nominee
thereof.

                  "Guaranty" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, letters of
credit and reimbursement agreements in respect thereof), or all or any part of
any Indebtedness.

                  "Hedging Obligations" means, with respect to any Person, the
Obligations of such Person under interest rate swap agreements, interest rate
cap agreements, and interest rate collar agreements, and other agreements or
arrangements designed to protect such Person against fluctuations in interest
rates.

                  "Holder" means a Person in whose name a Security is registered
in the Security Register.

                  "Indebtedness" means, with respect to any Person, any
indebtedness of such Person, whether or not contingent, in respect of borrowed
money or evidenced by bonds, notes, debentures of similar instruments or letters
of credit (or reimbursement agreements in respect thereof) or representing
Capital Lease Obligations or the balance deferred and unpaid of the purchase
price of any property or representing any Hedging Obligations, except any such
balance that constitutes an accrued expense or trade payable, if and to the
extent any of the foregoing indebtedness (other than letters of credit and
Hedging Obligations) would appear as a liability upon a balance sheet of such
Person prepared in accordance with generally accepted accounting principles, and
also includes, to the extent not otherwise included, the Guaranty of any
indebtedness of such Person or any other Person.

                  "Indenture" means this instrument as originally executed or as
it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument, and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 3.01.

                                       4
<PAGE>
                  "Interest", when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity.

                  "Interest Payment Date", when used with respect to any
Security, means the Stated Maturity of an installment of interest on such
Security.

                  "Lien" means any mortgage, lien, pledge, charge, security
interest, or other encumbrance of any kind, whether or not filed, recorded or
otherwise perfected under applicable law.

                  "Material Subsidiary" means (i) any Subsidiary of the Company
which at December 31, 2001, was a Significant Subsidiary or any successor to
such Subsidiary and (ii) any other Subsidiary of the Company or any of its
Subsidiaries if the Company's or any of Subsidiaries investments in such
Subsidiary at the date of determination thereof, represent 20% or more of the
Company's Consolidated Net Worth as of such date; provided, however, that clause
(ii) shall not include any Subsidiary if, at the time that it became a
Subsidiary, the Company contemplated commencing a voluntary case or proceeding
under the Bankruptcy Law with respect to such Subsidiary.

                  "Maturity", when used with respect to any Security, means the
date on which the principal of such Security or an installment of principal
becomes due and payable as therein or herein provided, whether at the Stated
Maturity or by declaration of acceleration, call for redemption or otherwise.

                  "Notice of Default" means a written notice of the kind
specified in Section 5.01(4).

                  "Obligations" means any principal, premium, interest,
penalties, fees, indemnifications, reimbursements, damages and other liabilities
payable under the documentation governing and Indebtedness.

                  "Officers' Certificate" means a certificate signed by the
Chairman of the Board, a Vice Chairman of the Board, the President or a Vice
President, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary, of the Company, and delivered to the Trustee. One of the
officers signing an Officers' Certificate given pursuant to Section 10.06 shall
be the principal executive, financial or accounting officer of the Company.

                  "Opinion of Counsel" means a written opinion of counsel, who
may be counsel for the Company.

                  "Original Issue Discount Security" means any Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
Section 5.02.

                  "Outstanding", when used with respect to Securities, means, as
of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:

                                       5
<PAGE>
                           (1) Securities theretofore cancelled by the Trustee
or delivered to the Trustee for cancellation;

                           (2) Securities for whose payment or redemption money
in the necessary amount has been theretofore deposited with the Trustee or any
Paying Agent (other than the Company) in trust or set aside and segregated in
trust by the Company (if the Company shall act as its own Paying Agent) for the
Holders of such Securities; provided that, if such Securities are to be
redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been made;

                           (3) Securities as to which Defeasance has been
effected pursuant to Section 14.02; and

                           (4) Securities which have been paid pursuant to
Section 3.06 or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, other than any such
Securities in respect of which there shall have been presented to the Trustee
proof satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company;

provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, (A) the principal
amount of an Original Issue Discount Security that shall be deemed to be
Outstanding shall be the amount of the principal thereof that would be due and
payable as of the date of such determination upon acceleration of the Maturity
thereof to such date pursuant to Section 5.02, (B) the principal amount of a
Security denominated in one or more foreign currencies or currency units shall
be the U.S. dollar equivalent, determined in the manner provided as contemplated
by Section 3.01 on the date of original issuance of such Security, of the
principal amount (or, in the case of an Original Issue Discount Security, the
U.S. dollar equivalent on the date of original issuance of such Security of the
amount determined as provided in Clause (A) above) of such Security, and (C)
Securities owned by the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Securities which a Responsible
Officer of the Trustee actually knows to be so owned shall be so disregarded.
Securities so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Securities and that the pledgee
is not the Company or any other obligor upon the Securities or any Affiliate of
the Company or of such other obligor.

                  "Paying Agent" means any Person authorized by the Company to
pay the principal of or any premium or interest on any Securities on behalf of
the Company.

                  "Permitted Liens" means (a) Liens in favor of the Company; (b)
Liens on any shares of Voting Stock of any corporation existing at the time such
corporation becomes a Material Subsidiary of the Company (and any extensions,
renewals or replacements thereof); (c) Liens to secure the performance of
statutory obligations, surety or appeal bonds, performance

                                       6
<PAGE>
bonds or other Obligations of a like nature incurred in the ordinary course of
business; (d) mechanics', materialmen's, workmen's, repairmen's, warehousemen's
and carrier's liens arising in the ordinary course of business; (e) easements,
rights of way and other similar restrictions that do not materially adversely
affect the use and enjoyment of the property subject thereto or affected thereby
and (f) Liens for taxes, assessments or governmental charges or claims that are
not yet delinquent or that are being contested in good faith by appropriate
proceedings promptly instituted and diligently concluded, provided, that any
reserve or appropriate provision as shall be required in conformity with
generally accepted accounting principles shall have been made therefor.

                  "Person" means any individual, corporation, partnership, joint
venture, limited liability company, joint stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.

                  "Place of Payment", when used with respect to the Securities
of any series, means the place or places where the principal of and any premium
and interest on the Securities of that series are payable as specified as
contemplated by Section 3.01.

                  "Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.06 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.

                  "Rating Decline" has the meaning specified in Section 13.01.

                  "Redemption Date", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.

                  "Redemption Price", when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.

                  "Regular Record Date" for the interest payable on any Interest
Payment Date on the Securities of any series means the date specified for that
purpose as contemplated by Section 3.01.

                  "Responsible Officer", when used with respect to the Trustee,
means any vice president, any assistant treasurer, any trust officer or
assistant trust officer or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject and who shall direct responsibility
for the administration of this Indenture.

                  "Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any Securities authenticated and
delivered under this Indenture.

                  "Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations of the Securities and Exchange Commission
promulgated thereunder.

                                       7
<PAGE>
                  "Security Register" and "Security Registrar" have the
respective meanings specified in Section 3.05.

                  "Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article I, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date hereof.

                  "Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 3.07.

                  "Stated Maturity", when used with respect to any Security or
any installment of principal thereof or interest thereon, means the date
specified in such Security as the fixed date on which the principal of such
Security or such installment of principal or interest is due and payable.

                  "Subject Securities" has the meaning specified in Section
13.01.

                  "Subsidiary" means a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, by the
Company or by one or more other Subsidiaries, or by the Company and one or more
other Subsidiaries. For the purposes of this definition, "voting stock" means
stock which ordinarily has voting power for the election of directors, whether
at all times or only so long as no senior class of stock has such voting power
by reason of any contingency.

                  "Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed; provided,
however, that in the event the Trust Indenture Act of 1939 is amended after such
date, "Trust Indenture Act" means, to the extent required by any such amendment,
the Trust Indenture Act of 1939 as so amended.

                  "Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder, and
if at any time there is more than one such Person, "Trustee" as used with
respect to the Securities of any series shall mean each Trustee with respect to
Securities of that series.

                  "U.S. Government Obligations" has the meaning specified in
Section 14.04.

                  "Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".

                  "Voting Stock" means any class or classes of Capital Stock
pursuant to which the holders thereof have the general voting power under
ordinary circumstances to elect at least a majority of the board of directors,
managers or trustees of any Person (irrespective of whether or not at the time
stock of any other class or classes shall have or might have voting power by
reason of the happening of any contingency).

                                       8
<PAGE>
Section 1.02 Compliance Certificates and Opinions.

                  Upon any application or request by the Company to the Trustee
to take any action under any provision of this Indenture, the Company shall
furnish to the Trustee such certificates and opinions as may be required under
the Trust Indenture Act. Each such certificate or opinion shall be given in the
form of an Officers' Certificate, if to be given by an officer of the Company,
or an Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.

                  Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (including certificates
provided for in Section 10.06) shall include

                  (1) a statement that each individual signing such certificate
         or opinion has read such covenant or condition and the definitions
         herein relating thereto;

                  (2) a brief statement as to the nature and scope of the
         examination or investigation upon which the statements or opinions
         contained in such certificate or opinion are based;

                  (3) a statement that, in the opinion of each such individual,
         he has made such examination or investigation as is necessary to enable
         him to express an informed opinion as to whether or not such covenant
         or condition has been complied with; and

                  (4) a statement as to whether, in the opinion of each such
         individual, such condition or covenant has been complied with.

Section 1.03 Form of Documents Delivered to Trustee.

                  In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.

                  Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company or any subsidiary of
the Company stating that the information with respect to such factual matters is
in the possession of the Company or any subsidiary of the Company, unless such
counsel knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.

                                       9
<PAGE>
                  Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.

Section 1.04 Acts of Holders; Record Dates.

                  Any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 6.01) conclusive in favor of
the Trustee and the Company, if made in the manner provided in this Section.

                  The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.

                  The ownership of Securities shall be proved by the Security
Register.

                  Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such action is made
upon such Security.

                  The Company may, in the circumstances permitted by the Trust
Indenture Act, set any day as the record date for the purpose of determining the
Holders of Outstanding Securities of any series entitled to give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Indenture to be given or taken by Holders
of Securities of such series. With regard to any record date set pursuant to
this paragraph, the Holders of Outstanding Securities of the relevant series on
such record date (or their duly appointed agents), and only such Persons, shall
be entitled to give or take the relevant action, whether or not such Holders
remain Holders after such record date. With regard to any action that may be
given or taken hereunder only by Holders of a requisite principal amount of
Outstanding Securities of any series (or their duly appointed agents) and for
which a record date is set pursuant to this paragraph, the Company may, at its
option, set an expiration date after which no such action purported to be given
or taken by any Holder shall be effective hereunder

                                       10
<PAGE>
unless given or taken on or prior to such expiration date by Holders of the
requisite principal amount of Outstanding Securities of such series on such
record date (or their duly appointed agents). On or prior to any expiration date
set pursuant to this paragraph, the Company may, on one or more occasions at its
option, extend such date to any later date. Nothing in this paragraph shall
prevent any Holder (or any duly appointed agent thereof) from giving or taking,
after any such expiration date, any action identical to, or, at any time,
contrary to or different from, the action or purported action to which such
expiration date relates, in which event the Company may set a record date in
respect thereof pursuant to this paragraph. Nothing in this paragraph shall be
construed to render ineffective any action taken at any time by the Holders (or
their duly appointed agents) of the requisite principal amount of Outstanding
Securities of the relevant series on the date such action is so taken.
Notwithstanding the foregoing or the Trust Indenture Act, the Company shall not
set a record date for, and the provisions of this paragraph shall not apply with
respect to, any notice, declaration or direction referred to in the next
paragraph.

                  The Trustee may set any day as a record date for the purpose
of determining the Holders of Outstanding Securities of any series entitled to
join in the giving or making of (i) any Notice of Default, (ii) any declaration
of acceleration referred to in Section 5.02, if an Event of Default with respect
to Securities of such series has occurred and is continuing and the Trustee
shall not have given such a declaration to the Company, (iii) any request to
institute proceedings referred to in Section 5.07(2) or (iv) any direction
referred to in Section 5.12, in each case with respect to Securities of such
series. Promptly after any record date is set pursuant to this paragraph, the
Trustee shall notify the Company and the Holders of Outstanding Series of such
series of any such record date so fixed and the proposed action. The Holders of
Outstanding Securities of such series on such record date (or their duly
appointed agents), and only such Persons, shall be entitled to join in such
notice, declaration or direction, whether or not such Holders remain Holders
after such record date; provided that, unless such notice, declaration or
direction shall have become effective by virtue of Holders of the requisite
principal amount of Outstanding Securities of such series on such record date
(or their duly appointed agents) having joined therein on or prior to the 90th
day after such record date, such notice, declaration or direction shall
automatically and without any action by any Person be cancelled and of no
further effect. Nothing in this paragraph shall be construed to prevent a Holder
(or a duly appointed agent thereof) from giving, before or after the expiration
of such 90-day period, a notice, declaration or direction contrary to or
different from, or, after the expiration of such period, identical to, the
notice, declaration or direction to which such record date relates, in which
event a new record date in respect thereof shall be set pursuant to this
paragraph. Nothing in this paragraph shall be construed to render ineffective
any notice, declaration or direction of the type referred to in this paragraph
given at any time to the Trustee and the Company by Holders (or their duly
appointed agents) of the requisite principal amount of Outstanding Securities of
the relevant series on the date such notice, declaration or direction is so
given.

                  Without limiting the foregoing, a Holder entitled hereunder to
give or take any action hereunder with regard to any particular Security may do
so with regard to all or any part of the principal amount of such Security or by
one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any different part of such principal amount.

                                       11
<PAGE>
Section 1.05 Notices, Etc., to Trustee and Company.

                  Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or permitted by
this Indenture to be made upon, given or furnished to, or filed with,

                  (1) the Trustee by any Holder or by the Company shall be
         sufficient for every purpose hereunder if made, given, furnished or
         filed in writing (which may be via facsimile) to or with the Trustee at
         its Corporate Trust Office, Attention: Corporate Trust Department, or

                  (2) the Company by the Trustee or by any Holder shall be
         sufficient for every purpose hereunder (unless otherwise herein
         expressly provided) if in writing and mailed, first-class postage
         prepaid, to the Company addressed to it at the address of its principal
         office specified in the first paragraph of this instrument or at any
         other address previously furnished in writing to the Trustee by the
         Company.

Section 1.06 Notice to Holders; Waiver.

                  Where this Indenture provides for notice to Holders of any
event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each Holder affected by such event, at his address as it appears in the Security
Register, not later than the latest date (if any), and not earlier than the
earliest date (if any), prescribed for the giving of such notice. In any case
where notice to Holders is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed, to any particular Holder shall
affect the sufficiency of such notice with respect to other Holders. Where this
Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.

                  In case by reason of the suspension of regular mail service or
by reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.

Section 1.07 Conflict with Trust Indenture Act.

                  If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall be
deemed to apply to this Indenture as so modified or to be excluded, as the case
may be. Wherever this Indenture refers to a provision of the Trust Indenture
Act, such provision is incorporated by reference in and made a part of this
Indenture.

                                       12
<PAGE>
                  The following Trust Indenture Act terms used in this Indenture
have the following meanings:

                  "commission" means the United States Securities and Exchange
         Commission.

                  "indenture securities" means the Securities.

                  "indenture security holder" means a Holder.

                  "indenture to be qualified" means this Indenture.

                  "indenture trustee" or "institutional trustee" means the
         Trustee.

                  "obligor on the indenture securities" means the Company and
         any other obligor on the Securities.

                  All other Trust Indenture Act terms used in this Indenture
that are defined by the Trust Indenture Act, defined by the Trust Indenture Act
referenced to another statute or defined by any Commission Rule and not
otherwise defined herein have the meanings defined to them thereby.

Section 1.08 Effect of Headings and Table of Contents.

                  The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.

Section 1.09 Successors and Assigns.

                  All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.

Section 1.10 Separability Clause.

                  In case any provision in this Indenture or in the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.

Section 1.11 Benefits of Indenture.

                  Nothing in this Indenture or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and the Holders, any benefit or any legal or equitable
right, remedy or claim under this Indenture.

Section 1.12 Governing Law.

                  This Indenture and the Securities shall be governed by and
construed in accordance with the law of the State of New York, but without
regard to principles of conflicts of laws.

                                       13
<PAGE>
Section 1.13 Legal Holidays.

                  In any case where any Interest Payment Date, Redemption Date
or Stated Maturity of any Security shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of the
Securities (other than a provision of the Securities of any series which
specifically states that such provision shall apply in lieu of this Section))
payment of interest or principal (and premium, if any) need not be made at such
Place of Payment on such date, but may be made on the next succeeding Business
Day at such Place of Payment with the same force and effect as if made on the
Interest Payment Date or Redemption Date, or at the Stated Maturity, provided
that no interest shall accrue for the period from and after such Interest
Payment Date, Redemption Date or Stated Maturity, as the case may be.

                                   ARTICLE II

                                 SECURITY FORMS

Section 2.01 Forms Generally.

                  The Securities of each series shall be in substantially the
form set forth in this Article, or in such other form as shall be established by
or pursuant to a Board Resolution or in one or more indentures supplemental
hereto, in each case with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture, and may
have such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution of the
Securities. If the form of Securities of any series is established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 3.03 for the authentication and delivery of such
Securities.

                  The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Securities, as evidenced by their
execution of such Securities.

Section 2.02 Form of Face of Security.

                  [Insert any legend required by the Internal Revenue Code and
the regulations thereunder.]

                              Jefferies Group, Inc.

               ---------------------------------------------------


No.                                                                   $
   --------------------                                                ---------

                                       14
<PAGE>
                  Jefferies Group, Inc., a corporation duly organized and
existing under the laws of Delaware (herein called the "Company", which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to
_______________________________________, or registered assigns, the principal
sum of ___________________ ___________________ Dollars on
____________________________ ___________________________ [if the Security is to
bear interest prior to Maturity, insert --, and to pay interest thereon from
_______________________ or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, semi-annually on ____________ and
____________ in each year, commencing __________ at the rate of ____% per annum,
until the principal hereof is paid or made available for payment [if applicable,
insert --, and at the rate of ____% per annum on any overdue principal and
premium and on any overdue installment of interest]. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such 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 _______ or
_______ (whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly provided
for will forthwith cease to be payable to the 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 Holders of Securities of this series
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 of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in said Indenture].

                  [If the Security is not to bear interest prior to Maturity,
insert -- The principal of this Security shall not bear interest except in the
case of a default in payment of principal upon acceleration, upon redemption or
at Stated Maturity and in such case the overdue principal of this Security shall
bear interest at the rate of ____% per annum, which shall accrue from the date
of such default in payment to the date payment of such principal has been made
or duly provided for. Interest on any overdue principal shall be payable on
demand. Any such interest on any overdue principal that is not so paid on demand
shall bear interest at the rate of _______% per annum, which shall accrue from
the date of such demand for payment to the date payment of such interest has
been made or duly provided for, and such interest shall also be payable on
demand.]

                  Payment of the principal of (and premium, if any) and [if
applicable, insert -- any such] interest on this Security will be made at the
office or agency of the Company maintained for that purpose in _____________, 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 [if applicable, insert
--; 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].

                                       15
<PAGE>
                  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.

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

Dated:


                                              JEFFERIES GROUP, INC.

                                              By:
                                                 ------------------------------
                                                   Name:
                                                   Title:
Attest:

----------------------



Section 2.03 Form of Reverse of Security.

                  This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of _______________ __, 2002 (herein
called the "Indenture"), between the Company 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 of 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 [if applicable insert --, limited in aggregate
principal amount to $___________].

                  [If applicable insert -- The Securities are subject to
redemption at the election of the Holders thereof, in whole or in part, and in
limited circumstances at the election of the Company, in whole, following the
occurrence of a Designated Event and a Rating Decline. Such redemptions will be
made at a Redemption Price equal to 100% of the principal amount, together with
accrued interest to the Redemption Date, as provided for in Article XIII of the
Indenture. [The Securities are not otherwise subject to redemption prior to
maturity and no sinking fund is provided for the Securities.]]

                                       16
<PAGE>
                  [If applicable insert -- The Securities of this series are
subject to redemption upon not less than 30 days' notice by mail, [if
applicable, insert -- (1) on ___________ in any year commencing with the year
______ and ending with the year ______ through operation of the sinking fund for
this series at a Redemption Price equal to 100% of the principal amount, and
(2)] at any time [if applicable insert on or after ___________, 20__], as a
whole or in part, at the election of the Company, at the following Redemption
Prices (expressed as percentages of the principal amount): If redeemed [if
applicable insert -- on or before _______________, __%, and if redeemed] during
the 12-month period beginning _____________ of the years indicated,


<TABLE>
<CAPTION>
Year            Redemption Price          Year             Redemption Price
<S>             <C>                       <C>              <C>









</TABLE>

and thereafter at a Redemption Price equal to _____% of the principal amount,
together in the case of any such redemption [if applicable, insert -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest installments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Securities,
or one or more Predecessor Securities, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.

                  [If applicable, insert -- The Securities of this series are
subject to redemption upon not less than 30 days' notice by mail, (1) on
____________ in any year commencing with the year ____ and ending with the year
____ through operation of the sinking fund for this series at the Redemption
Prices for redemption through operation of the sinking fund (expressed as
percentages of the principal amount) set forth in the table below, and (2) at
any time [if applicable, insert -- on or after ____________], as a whole or in
part, at the election of the Company, at the Redemption Prices for redemption
otherwise than through operation of the sinking fund (expressed as percentages
of the principal amount) set forth in the table below: If redeemed during the
12-month period beginning _____________ of the years indicated,

<TABLE>
<CAPTION>

                                                           Redemption
                   Redemption Price                   Price For Redemption
                For Redemption Through               Otherwise Than Through
Year         Operation of the Sinking Fund        Operation of the Sinking Fund
----         -----------------------------        -----------------------------
<S>          <C>                                  <C>

</TABLE>

                                       17
<PAGE>
and thereafter at a Redemption Price equal to _____% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest installments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.]

                  [If applicable, insert -- Notwithstanding the foregoing, the
Company may not, prior to ____________ redeem any Securities of this series as
contemplated by [if applicable, insert -- Clause (2) of] the preceding paragraph
as a part of, or in anticipation of, any refunding operation by the application,
directly or indirectly, of moneys borrowed having an interest cost to the
Company (calculated in accordance with generally accepted financial practice) of
less than _____% per annum.]

                  [If applicable, insert -- The sinking fund for this series
provides for the redemption on ____________ in each year beginning with the year
_______ and ending with the year _____ of [if applicable, insert -- not less
than $____________ "mandatory sinking fund") and not more than] $________
aggregate principal amount of Securities of this series. Securities of this
series acquired or redeemed by the Company otherwise than through (if
applicable, insert -- mandatory] sinking fund payments may be credited against
subsequent [if applicable, insert -- mandatory] sinking fund payments otherwise
required to be made [if applicable, insert -- in the inverse order in which they
become due).]

                  [If the Security is subject to redemption of any kind, insert
-- In the event of redemption of this Security in part only, a new Security or
Securities of this series and of like tenor for the unredeemed portion hereof
will be issued in the name of the Holder hereof upon the cancellation hereof.]

                  [If applicable, insert -- The Indenture contains provisions
for defeasance at any time of (l) the entire indebtedness of this Security or
(2) 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 the Security is not an Original Issue Discount Security,
insert -- 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.]

                  [If the Security is an Original Issue Discount Security,
insert -- If an Event of Default with respect to Securities of this series shall
occur and be continuing, an amount of principal of the Securities of this series
may be declared due and payable in the manner and with the effect provided in
the Indenture. Such amount shall be equal to insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal and overdue interest all of the
Company's obligations in respect of the payment of the principal of and
interest, if any, on the Securities of this series shall terminate.]

                                       18
<PAGE>
                  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 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 registerable 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 multiple
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like

                                       19
<PAGE>
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 or the Security Registrar 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 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.

Section 2.04 Form of Legend for Global Securities.

                  Unless otherwise specified as contemplated by Section 3.01 for
the Securities evidenced thereby, every Global Security authenticated and
delivered hereunder shall bear a legend in substantially the following form:

                  This Security is a Global Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of a Depositary
or a nominee thereof. This Security may not be transferred to, or registered or
exchanged for Securities registered in the name of, any Person other than the
Depositary or a nominee thereof and no such transfer may be registered, except
in the limited circumstances described in the Indenture. Every Security
authenticated and delivered upon registration of transfer of, or in exchange for
or in lieu of, this Security shall be a Global Security subject to the
foregoing, except in such limited circumstances.

Section 2.05      Form of Trustee's Certificate of Authentication.

                  The Trustee's certificates of authentication shall be in
substantially the following form:

                  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

                                         Dated:
                                               ------------------------

                                       20
<PAGE>
                                  ARTICLE III

                                 THE SECURITIES

Section 3.01 Amount Unlimited; Issuable in Series.

                  The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.

                  The Securities may be issued in one or more series. There
shall be established in or pursuant to a Board Resolution and, subject to
Section 3.03, set forth, or determined in the manner provided, in an Officers'
Certificate, or established in one or more indentures supplemental hereto, prior
to the issuance of Securities of any series,

                  (1) the title of the Securities of the series, including CUSIP
         Numbers (which shall distinguish the Securities of the series from
         Securities of any other series);

                  (2) any limit upon the aggregate principal amount of the
         Securities of the series which may be authenticated and delivered under
         this Indenture (except for Securities authenticated and delivered upon
         registration of transfer of, or in exchange for, or in lieu of, other
         Securities of the series pursuant to Section 3.04, 3.05, 3.06, 9.06 or
         11.07 and except for any Securities which, pursuant to Section 3.03,
         are deemed never to have been authenticated and delivered hereunder);

                  (3) the Person to whom any interest on a Security of the
         series shall be payable, if other than the Person in whose name that
         Security (or one or more Predecessor Securities) is registered at the
         close of business on the Regular Record Date for such interest;

                  (4) the date or dates on which the principal of the Securities
         of the series is payable;

                  (5) the rate or rates at which the Securities of the series
         shall bear interest, if any, the date or dates from which such interest
         shall accrue, the Interest Payment Dates on which any such interest
         shall be payable and the Regular Record Date for any interest payable
         on any Interest Payment Date;

                  (6) the place or places where the principal of and any premium
         and interest on Securities of the series shall be payable;

                  (7) the period or periods within which, the price or prices at
         which and the terms and conditions upon which Securities of the series
         may be redeemed, in whole or in part, at the option of the Company;

                  (8) the obligation, if any, of the Company to redeem or
         purchase Securities of the series pursuant to any sinking fund or
         analogous provisions or at the option of a Holder thereof and the
         period or periods within which, the price or prices at which and

                                       21
<PAGE>
         the terms and conditions upon which Securities of the series shall be
         redeemed or purchased, in whole or in part, pursuant to such
         obligation;

                  (9) if other than denominations of $1,000 and any integral
         multiple thereof, the denominations in which Securities of the series
         shall be issuable;

                  (10) the currency, currencies or currency units in which
         payment of the principal of and any premium and interest on any
         Securities of the series shall be payable if other than the currency of
         the United States of America and the manner of determining the
         equivalent thereof in the currency of the United States of America for
         purposes of the definition of "Outstanding" in Section 1.01;

                  (11) if the amount of payments of principal of or any premium
         or interest on any Securities of the series may be determined with
         reference to an index, the manner in which such amounts shall be
         determined;

                  (12) if the principal of or any premium or interest on any
         Securities of the series is to be payable, at the election of the
         Company or a Holder thereof, in one or more currencies or currency
         units other than that or those in which the Securities are stated to be
         payable, the currency, currencies or currency units in which payment of
         the principal of and any premium and interest on Securities of such
         series as to which such election is made shall be payable, and the
         periods within which and the terms and conditions upon which such
         election is to be made;

                  (13) if other than the principal amount thereof, the portion
         of the principal amount of Securities of the series which shall be
         payable upon declaration of acceleration of the Maturity thereof
         pursuant to Section 5.02;

                  (14) the applicability, nonapplicability, or variation, of
         Article XIII with respect to the Securities of such Series;

                  (15) if applicable, that the Securities of the series shall be
         subject to either or both of Defeasance or Covenant Defeasance as
         provided in Article XIV;

                  (16) if and as applicable, that the Securities of the series
         shall be issuable in whole or in part in the form of one or more Global
         Securities and, in such case, the Depositary or Depositaries for such
         Global Security or Global Securities and any circumstances other than
         those set forth in Section 3.05 in which any such Global Security may
         be transferred to, and registered and exchanged for Securities
         registered in the name of, a Person other than the Depositary for such
         Global Security or a nominee thereof and in which any such transfer may
         be registered;

                  (17) any addition to or change in the covenants set forth in
         Article X which applies to Securities of the series; and

                  (18) any other terms of the series (which terms shall not be
         inconsistent with the provisions of this Indenture, except as permitted
         by Section 9.01(5)).

                                       22
<PAGE>
                  All Securities of any one series shall be substantially
identical except as to denomination and except as may otherwise be provided in
or pursuant to the Board Resolution referred to above and (subject to Section
3.03) set forth, or determined in the manner provided, in the Officers'
Certificate referred to above or in any such indenture supplemental hereto.

                  If any of the terms of the series are established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the
Officers' Certificate setting forth the terms of the series.

                  The Company may, from time to time, by adoption of a Board
Resolution and subject to compliance with any other applicable provisions of
this Indenture, without the consent of the Holders, create and issue pursuant to
this Indenture additional securities of any series of Securities ("Add On
Securities") having terms and conditions identical to those of such series of
Outstanding Securities, except that such Add On Securities:

                           (i) may have a different issue date from such series
of Outstanding Securities;

                           (ii) may have a different amount of interest payable
on the first Interest Payment Date after issuance than is payable on such series
of Outstanding Securities; and

                           (iii) may have terms specified in such Board
Resolution for such Add On Securities making appropriate adjustments to this
Article III applicable to such Add On Securities in order to conform to and
ensure compliance with the Securities Act (or applicable securities laws) which
are not adverse in any material respect to the Holder of any Outstanding
Securities (other than such Add On Securities) and which shall not affect the
rights or duties of the Trustee.


Section 3.02 Denominations.

                  The Securities of each series shall be issuable only in
registered form without coupons in such denominations as shall be specified as
contemplated by Section 3.01. In the absence of any such specified denomination
with respect to the Securities of any series, the Securities of such series
shall be issuable in denominations of $1,000 and any integral multiple thereof.

Section 3.03 Execution, Authentication, Delivery and Dating.

                  The Securities shall be executed on behalf of the Company by
its Chairman of the Board, its Vice Chairman of the Board, its President, one of
its Vice Presidents or its Treasurer under its corporate seal reproduced thereon
attested by its Secretary or one of its Assistant Secretaries. The signature of
any of these officers on the Securities may be manual or facsimile.

                  Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such

                                       23
<PAGE>
individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Securities or did not hold such offices at
the date of such Securities.

                  At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any Series
executed by the Company to the Trustee for authentication, together with a
Company Order for the authentication and delivery of such Securities, and the
Trustee in accordance with the Company Order shall authenticate and deliver such
Securities. If the form or terms of the Securities of the series have been
established in or pursuant to one or more Board Resolutions as permitted by
Sections 2.01 and 3.01, in authenticating such Securities, and accepting the
additional responsibilities under this Indenture in relation to such Securities,
the Trustee shall be entitled to receive, and (subject to Section 6.01) shall be
fully protected in relying upon, an Opinion of Counsel stating,

                  (1) if the form of such Securities has been established by or
         pursuant to Board Resolution as permitted by Section 2.01, that such
         form has been established in conformity with the provisions of this
         Indenture;

                  (2) if the terms of such Securities have been established by
         or pursuant to Board Resolution as permitted by Section 3.01, that such
         terms have been established in conformity with the provisions of this
         Indenture; and

                  (3) that such Securities, when authenticated and delivered by
         the Trustee and issued by the Company in the manner and subject to any
         conditions specified in such Opinion of Counsel, will constitute valid
         and legally binding obligations of the Company enforceable in
         accordance with their terms, subject to bankruptcy, insolvency,
         fraudulent transfer, reorganization, moratorium and similar laws of
         general applicability relating to or affecting creditors' rights and to
         general equity principles.

If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.

                  Notwithstanding the provisions of Section 3.01 and of the
preceding paragraph, if all Securities of a series are not to be originally
issued at one time, it shall not be necessary to deliver the Officers'
Certificate otherwise required pursuant to Section 3.01 or the Company Order and
Opinion of Counsel otherwise required pursuant to such preceding paragraph at or
prior to the time of authentication of each Security of such series if such
documents are delivered at or prior to the authentication upon original issuance
of the first Security of such series to be issued.

                  Each Security shall be dated the date of its authentication.

                  No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for
herein executed by the Trustee by manual signature, and such certificate upon
any Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered hereunder. Notwithstanding
the foregoing, if

                                       24
<PAGE>
any Security shall have been authenticated and delivered hereunder but never
issued and sold by the Company, and the Company shall deliver such Security to
the Trustee for cancellation as provided in Section 3.09, for all purposes of
this Indenture such Security shall be deemed never to have been authenticated
and delivered hereunder and shall never be entitled to the benefits of this
Indenture.

Section 3.04 Temporary Securities.

                  Pending the preparation of definitive Securities of any
series, the Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Securities which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.

                  If temporary Securities of any series are issued, the Company
will cause definitive Securities of that series to be prepared without
unreasonable delay. After the preparation of definitive Securities of such
series, the temporary Securities of such series shall be exchangeable for
definitive Securities of such series upon surrender of the temporary Securities
of such series at the office or agency of the Company in a Place of Payment for
that series, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Securities of any series the Company shall execute and
the Trustee shall authenticate and deliver in exchange therefor one or more
definitive Securities of the same series, of any authorized denominations and of
a like aggregate principal amount and tenor. Until so exchanged the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series and tenor.

Section 3.05 Registration, Registration of Transfer and Exchange.

                  The Company shall cause to be kept at the Corporate Trust
Office of the Trustee a register (the register maintained in such office and in
any other office or agency of the Company in a Place of Payment being herein
sometimes collectively referred to as the "Security Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall provide
for the registration of Securities and of transfers of Securities. The Trustee
is hereby appointed "Security Registrar" for the purpose of registering
Securities and transfers of Securities as herein provided.

                  Upon surrender for registration of transfer of any Security of
any series at the office or agency in a Place of Payment for that series, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
the same series, of any authorized denominations and of a like aggregate
principal amount and tenor.

                  At the option of the Holder, Securities of any series may be
exchanged for other Securities of the same series, of any authorized
denominations and of a like aggregate principal amount and tenor, upon surrender
of the Securities to be exchanged at such office or agency.

                                       25
<PAGE>
Whenever any Securities are so surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, the Securities which
the Holder making the exchange is entitled to receive.

                  All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.

                  Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the Trustee) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.

                  No service charge shall be made for any registration of
transfer or exchange of Securities, but the Company or Security Registrar may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Securities, other than exchanges pursuant to Section 3.04, 9.06 or
11.07 not involving any transfer.

                  The Company shall not be required (1) to issue, register the
transfer of or exchange Securities of any series during a period beginning at
the opening of business 15 days before the day of the mailing of a notice of
redemption of Securities of that series selected for redemption under Section
11.03 and ending at the close of business on the day of such mailing, or (2) to
register the transfer of or exchange any Security so selected for redemption in
whole or in part, except the unredeemed portion of any Security being redeemed
in part.

                  Notwithstanding any other provision in this Indenture, no
Global Security may be transferred to, or registered or exchanged for Securities
registered in the name of, any Person other than the Depositary for such Global
Security or any nominee thereof, and no such transfer may be registered, unless
(1) such Depositary (A) notifies the Company that it is unwilling or unable to
continue as Depositary for such Global Security or (B) has ceased to be a
clearing agency registered under the Exchange Act, (2) the Company executes and
delivers to the Trustee a Company Order that such Global Security shall be so
transferable, registrable and exchangeable, and such transfers shall be
registrable, (3) there shall have occurred and be continuing an Event of Default
with respect to the Securities evidenced by such Global Security or (4) there
shall exist such other circumstances, if any, as have been specified for this
purpose as contemplated by Section 3.01. Notwithstanding any other provision in
this Indenture, a Global Security to which the restriction set forth in the
preceding sentence shall have ceased to apply may be transferred only to, and
may be registered and exchanged for Securities registered only in the name or
names of, such Person or Persons as the Depositary for such Global Security
shall have directed and no transfer thereof other than such a transfer may be
registered.

                  Every Security authenticated and delivered upon registration
of transfer of, or in exchange for or in lieu of, a Global Security to which the
restriction set forth in the first sentence of the preceding paragraph shall
apply, whether pursuant to this Section, Section 3.04, 3.06, 9.06

                                       26
<PAGE>
or 11.07 or otherwise, shall be authenticated and delivered in the form of, and
shall be, a Global Security.

Section 3.06 Mutilated, Destroyed, Lost and Stolen Securities.

                  If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.

                  If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of the same series and of like tenor and principal amount and bearing a number
not contemporaneously outstanding.

                  In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.

                  Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.

                  Every new Security of any series issued pursuant to this
Section in exchange for any mutilated Security or in lieu of any destroyed, lost
or stolen Security shall constitute an original additional contractual
obligation of the Company, whether or not the mutilated, destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that series duly issued hereunder.

                  The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.

Section 3.07 Payment of Interest; Interest Rights Preserved.

                  Except as otherwise provided as contemplated by Section 3.01
with respect to any series of Securities, interest on any Security which is
payable, and is punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest.

                  Any interest on any Security of any series which is payable,
but is not punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall

                                       27
<PAGE>
forthwith cease to be payable to the Holder on the relevant Regular Record Date
by virtue of having been such Holder, and such Defaulted Interest may be paid by
the Company, at its election in each case, as provided in Clause (1) or (2)
below:

                  (1) The Company may elect to make payment of any Defaulted
         Interest to the Persons in whose names the Securities of such series
         (or their respective Predecessor Securities) are registered at the
         close of business on a Special Record Date for the payment of such
         Defaulted Interest, which shall be fixed in the following manner. The
         Company shall notify the Trustee in writing of the amount of Defaulted
         Interest proposed to be paid on each Security of such series and the
         date of the proposed payment, and at the same time the Company shall
         deposit with the Trustee an amount of money equal to the aggregate
         amount proposed to be paid in respect of such Defaulted Interest or
         shall make arrangements satisfactory to the Trustee for such deposit
         prior to the date of the proposed payment, such money when deposited to
         be held in trust for the benefit of the Persons entitled to such
         Defaulted Interest as in this Clause provided. Thereupon the Trustee
         shall fix a Special Record Date for the payment of such Defaulted
         Interest which shall be not more than 15 days and not less than 10 days
         prior to the date of the proposed payment and not less than 10 days
         after the receipt by the Trustee of the notice of the proposed payment.
         The Trustee shall promptly notify the Company of such Special Record
         Date and, in the name and at the expense of the Company, shall cause
         notice of the proposed payment of such Defaulted Interest and the
         Special Record Date therefor to be mailed, first-class postage prepaid,
         to each Holder of Securities of such series at his address as it
         appears in the Security Register, not less than 10 days prior to such
         Special Record Date. Notice of the proposed payment of such Defaulted
         Interest and the Special Record Date therefor having been so mailed,
         such Defaulted Interest shall be paid to the Persons in whose names the
         Securities of such series (or their respective Predecessor Securities)
         are registered at the close of business on such Special Record Date and
         shall no longer be payable pursuant to the following Clause (2).

                  (2) The Company may make payment of any Defaulted Interest on
         the Securities of any series in any other lawful manner not
         inconsistent with the requirements of any securities exchange on which
         such Securities may be listed, and upon such notice as may be required
         by such exchange, if, after notice given by the Company to the Trustee
         of the proposed payment pursuant to this Clause, such manner of payment
         shall be deemed practicable by the Trustee.

                  Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.

Section 3.08 Persons Deemed Owners.

                  Prior to due presentment of a 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 such Security is registered as the owner of
such Security for the purpose of receiving payment of principal of and any
premium and (subject to Section 3.07) any interest on such Security and for

                                       28
<PAGE>
all other purposes whatsoever, whether or not such Security be overdue, and
neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary.

Section 3.09 Cancellation.

                  All Securities surrendered for payment, redemption,
registration of transfer or exchange or for credit against any sinking fund
payment shall, if surrendered to any Person other than the Trustee, be delivered
to the Trustee and shall be promptly cancelled by it. The Company may at any
time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and may deliver to the Trustee (or to any other Person for
delivery to the Trustee) for cancellation any Securities previously
authenticated hereunder which the Company has not issued and sold, and all
Securities so delivered shall be promptly cancelled by the Trustee. No
Securities shall be authenticated in lieu of or in exchange for any Securities
cancelled as provided in this Section, except as expressly permitted by this
Indenture. All cancelled Securities held by the Trustee shall be disposed of by
the Trustee in its customary manner.

Section 3.10 Computation of Interest.

                  Except as otherwise specified as contemplated by Section 3.01
for Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.

Section 3.11 CUSIP Numbers.

                  The Company in issuing the Securities may use "CUSIP" numbers
(if then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Holders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Company will promptly notify
the Trustee of any changes in the "CUSIP" numbers.


                                   ARTICLE IV

                           SATISFACTION AND DISCHARGE

Section 4.01 Satisfaction and Discharge of Indenture.

                  This Indenture shall upon Company Request cease to be of
further effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for), and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when

                                       29
<PAGE>
                  (1) either

                           (A) all Securities theretofore authenticated and
                  delivered (other than (i) Securities which have been
                  destroyed, lost or stolen and which have been replaced or paid
                  as provided in Section 3.06 and (ii) Securities for whose
                  payment money has theretofore been deposited in trust or
                  segregated and held in trust by the Company and thereafter
                  repaid to the Company or discharged from such trust) have been
                  delivered to the Trustee for cancellation; or

                           (B) all such Securities not theretofore delivered to
                  the Trustee for cancellation

                                    (i) have become due and payable, or

                                    (ii) will become due and payable at their
                           Stated Maturity within one year, or

                                    (iii) are to be called for redemption within
                           one year under arrangements satisfactory to the
                           Trustee for the giving of notice of redemption by the
                           Trustee in the name, and at the expense, of the
                           Company,

                  and the Company, in the case of (i), (ii) or (iii) above, has
                  deposited or caused to be deposited with the Trustee as trust
                  funds in trust for the purpose an amount sufficient to pay and
                  discharge the entire indebtedness on such Securities not
                  theretofore delivered to the Trustee for cancellation, for
                  principal and any premium and interest to the date of such
                  deposit (in the case of Securities which have become due and
                  payable) or to the Stated Maturity or Redemption Date, as the
                  case may be;

                  (2) the Company has paid or caused to be paid all other sums
         payable hereunder by the Company; and

                  (3) the Company has delivered to the Trustee an Officers'
         Certificate and an Opinion of Counsel, each stating that all conditions
         precedent herein provided for relating to the satisfaction and
         discharge of this Indenture have been complied with.

                  Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under Section 6.07,
and, if money shall have been deposited with the Trustee pursuant to subclause
(B) of Clause (1) of this Section, the obligations of the Trustee under Section
4.02 shall survive such satisfaction and discharge.

Section 4.02 Application of Trust Money.

                  All money deposited with the Trustee pursuant to Section 4.01
shall be held in trust and applied by it, in accordance with the provisions of
the Securities and this Indenture, to the payment, either directly or through
any Paying Agent (including the Company acting as its

                                       30
<PAGE>
own Paying Agent) as the Trustee may determine, to the Persons entitled thereto,
of the principal and any premium and interest for whose payment such money has
been deposited with the Trustee.

                                   ARTICLE V

                                    REMEDIES

Section 5.01 Events of Default.

                  "Event of Default", wherever used herein with respect to
Securities of any series, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):

                  (1) default in the payment of any interest upon any Security
         of that series when it becomes due and payable, and continuance of such
         default for a period of 30 days; or

                  (2) default in the payment of the principal of (or premium, if
         any, on) any Security of that series at its Maturity; or

                  (3) default in the deposit of any sinking fund payment, when
         and as due by the terms of a Security of that series, and continuance
         of such default for a period of 30 days; or

                  (4) default in the performance, or breach, of any covenant or
         warranty of the Company in this Indenture (other than a covenant or
         warranty a default in whose performance or whose breach is elsewhere in
         this Section specifically dealt with or which has expressly been
         included in this Indenture solely for the benefit of series of
         Securities other than that series), and continuance of such default or
         breach for a period of 90 days after there has been given, by
         registered or certified mail, to the Company by the Trustee or to the
         Company and the Trustee by the Holders of at least 25% in principal
         amount of the Outstanding Securities of that series a written notice
         specifying such default or breach and requiring it to be remedied and
         stating that such notice is a "Notice of Default" hereunder; or

                  (5) the Company shall fail to pay any Indebtedness in excess
         of $10,000,000 owing by the Company, or any interest or premium
         thereon, when due (whether by scheduled maturity, required prepayment,
         acceleration, demand or otherwise), and such failure shall continue
         after the applicable grace period, if any, specified in the agreement
         or instrument relating to such Indebtedness, or the Company shall fail
         to perform any term, covenant or agreement on its part to be performed
         under any agreement or instrument evidencing or securing or relating to
         any such Indebtedness, if the effect of such failure in either case is
         that the maturity of such Indebtedness is duly accelerated, without
         such Indebtedness having been discharged or such acceleration having
         been rescinded or annulled, in each such case, within a period of 10
         days after there shall have

                                       31
<PAGE>
         been given, by registered or certified mail, to the Company by the
         Trustee or to the Company and the Trustee by Holders of at least 25% in
         principal amount of the Outstanding Securities of that series, a
         written notice specifying such default and requiring the Company to
         cause such Indebtedness to be discharged or cause such acceleration to
         be rescinded or annulled, as the case may be, and stating that such
         notice is a "Notice of Default" hereunder (the Trustee shall not be
         deemed to have knowledge of a default under this subsection (5) unless
         it shall have actual knowledge thereof); provided, however, that,
         subject to the provisions of Sections 6.01 and 6.05, the Trustee shall
         not be deemed to have knowledge of such failure to pay unless either
         (A) a Responsible Officer of the Trustee shall have actual knowledge of
         such failure to pay or (B) the Trustee shall have received written
         notice thereof from the Company, from any Holder, from the holder of
         any such Indebtedness or from the trustee thereunder; or

                  (6) the entry by a court having jurisdiction in the premises
         of (A) a decree or order for relief in respect of the Company in an
         involuntary case or proceeding under any applicable Federal or State
         bankruptcy, insolvency, reorganization or other similar law or (B) a
         decree or order adjudging the Company a bankrupt or insolvent, or
         approving as properly filed a petition seeking reorganization,
         arrangement, adjustment or composition of or in respect of the Company
         under any applicable Federal or State law, or appointing a custodian,
         receiver, liquidator, assignee, trustee, sequestrator or other similar
         official of the Company or of any substantial part of its property, or
         ordering the winding up or liquidation of its affairs, and the
         continuance of any such decree or order for relief or any such other
         decree or order unstayed and in effect for a period of 60 consecutive
         days; or

                  (7) the commencement by the Company of a voluntary case or
         proceeding under any applicable Federal or State bankruptcy,
         insolvency, reorganization or other similar law or of any other case or
         proceeding to be adjudicated a bankrupt or insolvent, or the consent by
         it to the entry of a decree or order for relief in respect of the
         Company in an involuntary case or proceeding under any applicable
         Federal or State bankruptcy, insolvency, reorganization or other
         similar law or to the commencement of any bankruptcy or insolvency case
         or proceeding against it, or the filing by it of a petition or answer
         or consent seeking reorganization or relief under any applicable
         Federal or State law, or the consent by it to the filing of such
         petition or to the appointment of or taking possession by a custodian,
         receiver, liquidator, assignee, trustee, sequestrator or other similar
         official of the Company or of any substantial part of its property, or
         the making by it of an assignment for the benefit of creditors, or the
         admission by it in writing of its inability to pay its debts generally
         as they become due, or the taking of corporate action by the Company in
         furtherance of any such action; or

                  (8) any other Event of Default provided with respect to
         Securities of that series.

Section 5.02 Acceleration of Maturity; Rescission and Annulment.

                  If an Event of Default with respect to Securities of any
series at the time Outstanding occurs and is continuing, then in every such case
the Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series may declare the

                                       32
<PAGE>
principal amount (or, if any of the Securities of that series are Original Issue
Discount Securities, such portion of the principal amount of such Securities as
may be specified in the terms thereof) of all of the Securities of that series
to be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by Holders), and upon any such declaration such principal
amount (or specified amount) shall become immediately due and payable.

                  At any time after such a declaration of acceleration with
respect to Securities of any series has been made and before a judgment or
decree for payment of the money due has been obtained by the Trustee as
hereinafter in this Article provided, the Holders of a majority in principal
amount of the Outstanding Securities of that series, by written notice to the
Company and the Trustee, may rescind and annul such declaration and its
consequences if

                  (1) the Company has paid or deposited with the Trustee a sum
         sufficient to pay

                           (A) all overdue interest on all Securities of that
                  series,

                           (B) the principal of (and premium, if any, on) any
                  Securities of that series which have become due otherwise than
                  by such declaration of acceleration and any interest thereon
                  at the rate or rates prescribed therefor in such Securities,

                           (C) to the extent that payment of such interest is
                  lawful, interest upon overdue interest at the rate or rates
                  prescribed therefor in such Securities, and

                           (D) all sums paid or advanced by the Trustee
                  hereunder and the reasonable compensation, expenses,
                  disbursements and advances of the Trustee, its agents and
                  counsel;

         and

                  (2) all Events of Default with respect to Securities of that
         series, other than the non-payment of the principal of Securities of
         that series which have become due solely by such declaration of
         acceleration, have been cured or waived as provided in Section 5.13.

No such rescission shall affect any subsequent default or impair any right
consequent thereon.

Section 5.03 Collection of Indebtedness and Suits for Enforcement by Trustee.

                  The Company covenants that if:

                  (1) default is made in the payment of any interest on any
         Security when such interest becomes due and payable and such default
         continues for a period of 30 days, or

                  (2) default is made in the payment of the principal of (or
         premium, if any, on) any Security at the Maturity thereof,

                                       33
<PAGE>
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and any premium and interest and, to the extent that
payment of such interest shall be legally enforceable, interest on any overdue
principal and premium and on any overdue interest, at the rate or rates
prescribed therefor in such Securities, and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.

                  If an Event of Default with respect to Securities of any
series occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders of Securities of
such series by such appropriate judicial proceedings as the Trustee shall deem
necessary to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.

Section 5.04 Trustee May File Proofs of Claim.

                  In case of any judicial proceeding relative to the Company (or
any other obligor upon the Securities), its property or its creditors, the
Trustee shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 6.07.

                  No provision of this Indenture shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding;
provided, however, that the Trustee may, on behalf of the Holders, vote for the
election of a trustee in bankruptcy or similar official and be a member of a
creditors' or other similar committee.

Section 5.05 Trustee May Enforce Claims Without Possession of Securities.

                  All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.

                                       34
<PAGE>
Section 5.06 Application of Money Collected.

                  Any money collected by the Trustee pursuant to this Article
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal
or any premium or interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:

                  FIRST: To the payment of all amounts due the Trustee under
         Section 6.07;

                  SECOND: To the payment of the amounts then due and unpaid for
         principal of and any premium and interest on the Securities in respect
         of which or for the benefit of which such money has been collected,
         ratably, without preference or priority of any kind, according to the
         amounts due and payable on such Securities for principal and any
         premium and interest, respectively; and

                  THIRD:   To the Company.

Section 5.07 Limitation on Suits.

                  No Holder of any Security of any series shall have any right
to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless

                  (1) such Holder has previously given written notice to the
         Trustee of a continuing Event of Default with respect to the Securities
         of that series;

                  (2) the Holders of not less than 25% in principal amount of
         the Outstanding Securities of that series shall have made written
         request to the Trustee to institute proceedings in respect of such
         Event of Default in its own name as Trustee hereunder;

                  (3) such Holder or Holders have offered to the Trustee
         reasonable indemnity satisfactory to it against the costs, expenses and
         liabilities to be incurred in compliance with such request;

                  (4) the Trustee for 60 days after its receipt of such notice,
         request and offer of indemnity has failed to institute any such
         proceeding; and

                  (5) no direction inconsistent with such written request has
         been given to the Trustee during such 60-day period by the Holders of a
         majority in principal amount of the Outstanding Securities of that
         series;

it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.

                                       35
<PAGE>
Section 5.08 Unconditional Right of Holders to Receive Principal, Premium and
             Interest.

                  Notwithstanding any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of and any premium and
(subject to Section 3.07) interest on such Security on the respective Stated
Maturities expressed in such Security (or, in the case of redemption, on the
Redemption Date) and to institute suit for the enforcement of any such payment,
and such rights shall not be impaired without the consent of such Holder.

Section 5.09 Restoration of Rights and Remedies.

                  If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.

Section 5.10 Rights and Remedies Cumulative.

                  Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of Section 3.06, no right or remedy herein conferred upon or reserved
to the Trustee or to the Holders is intended to be exclusive of any other right
or remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.

Section 5.11 Delay or Omission Not Waiver.

                  No delay or omission of the Trustee or of any Holder of any
Securities to exercise any right or remedy accruing upon any Event of Default
shall impair any such right or remedy or constitute a waiver of any such Event
of Default or an acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to the Holders may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or by the Holders,
as the case may be.

Section 5.12 Control by Holders.

                  The Holders of a majority in principal amount of the
Outstanding Securities of any series shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee, with respect
to the Securities of such series, provided that

                  (1) such direction shall not be in conflict with any rule of
         law or with this Indenture,

                                       36
<PAGE>
                  (2) the Trustee may take any other action deemed proper by the
         Trustee which is not inconsistent with such direction, and

                  (3) subject to the provisions of Section 6.01, the Trustee
         shall have the right to decline to follow any such direction if the
         Trustee in good faith share, by a Responsible Officer or Officers of
         the Trustee, determine, and the Trustee shall have received a legal
         opinion stating, that the proceedings so directed would involve the
         Trustee in personal liability.

Section 5.13 Waiver of Past Defaults.

                  The Holders of not less than a majority in principal amount of
the Outstanding Securities of any series may on behalf of the Holders of all the
Securities of such series waive any past default hereunder with respect to such
series and its consequences, except a default

                  (1) in the payment of the principal of or any premium or
         interest on any Security of such series, or

                  (2) in respect of a covenant or provision hereof which under
         Article IX cannot be modified or amended without the consent of the
         Holder of each Outstanding Security of such series affected.

                  Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.

Section 5.14 Undertaking for Costs.

                  In any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, a court may require any party litigant in
such suit to file an undertaking to pay the costs of such suit, and may assess
costs against any such party litigant, in the manner and to the extent provided
in the Trust Indenture Act; provided that neither this Section nor the Trust
Indenture Act shall apply to any suit instituted by the Trustee, to any suit
instituted by any Holders of the Securities, or group of Holders of the
Securities, holding in the aggregate more than 10% of principal amount of the
Outstanding Securities of any series, or to any suit instituted by any Holder of
the Outstanding Securities for the enforcement of the payment of principal of or
interest on any Outstanding Securities held by such Holder, on or after the
respective due dates expressed in such Outstanding Securities, and provided,
further, that neither this Section nor the Trust Indenture Act shall be deemed
to authorize any court to require such an undertaking or to make such an
assessment in any suit instituted by the Company.

Section 5.15 Waiver of Usury, Stay or Extension Laws.

                  The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any usury, stay or
extension law wherever enacted, now or at any time hereafter in

                                       37
<PAGE>
force, which may affect the covenants or the performance of this Indenture; and
the Company (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.

                                   ARTICLE VI

                                   THE TRUSTEE

                  The Trustee hereby accepts the trust imposed upon it by this
Indenture and covenants and agrees to perform the same, as herein expressed.

Section 6.01 Duties of Trustee.

                  (a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
his own affairs.

                  (b) Except during the continuance of an Event of Default:

                  (1) The Trustee need perform only those duties as are
         specifically set forth in this Indenture and no others, and no
         covenants or obligations shall be implied in or read into this
         Indenture.

                  (2) In the absence of bad faith on its part, the Trustee may
         conclusively rely, as to the truth of the statements and the
         correctness of the opinions expressed therein, upon certificates or
         opinions furnished to the Trustee and conforming to the requirements of
         this Indenture. However, in the case of any such certificates or
         opinions which by any provision hereof are specifically required to be
         furnished to the Trustee, the Trustee shall be under a duty to examine
         the same to determine whether or not they substantially conform to the
         requirements of this Indenture (but need not confirm or investigate the
         accuracy of mathematical calculations or other facts stated therein).

                  (c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:

                  (1) This paragraph does not limit the effect of paragraph (b)
         of this Section 6.01.

                  (2) The Trustee shall not be liable for any error of judgment
         made in good faith by a Responsible Officer, unless it is proved that
         the Trustee was negligent in ascertaining the pertinent facts.

                  (3) The Trustee shall not be liable with respect to any action
         it takes or omits to take in good faith in accordance with a direction
         received by it pursuant to Section 5.12.

                                       38
<PAGE>
                  (d) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder or to take or omit to take any
action under this Indenture.

                  (e) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraphs (a), (b), (c), (d) and (f) of this
Section 6.01.

                  (f) The Trustee shall not be liable for interest on any assets
received by it except as the Trustee may agree in writing with the Company.
Assets held in trust by the Trustee need not be segregated from other assets
except to the extent required by law.

Section 6.02 Rights of Trustee.

                  Subject to Section 6.01:

                  (a) The Trustee may conclusively rely on any document (whether
in its original or facsimile form) believed by it to be genuine and to have been
signed or presented by the proper person. The Trustee need not investigate any
fact or matter stated in any document.

                  (b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such certificate or opinion.

                  (c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent appointed
with due care.

                  (d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers.

                  (e) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request, direction, consent, order, bond,
debenture, or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters as it may
see fit and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney at the sole cost of the
Company and shall incur no liability or additional liability of any kind by
reason of such investigation.

                  (f) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders, pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity satisfactory to it against the costs, expenses and liabilities which
may be incurred therein or thereby.

                  (g) the Trustee may consult with counsel of its selection and
the advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection of any action taken, suffered or omitted by in
hereunder in good faith and in reliance thereon.

                                       39
<PAGE>
                  (h) the Trustee shall not be deemed to have notice of any
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Securities and this Indenture.

                  (i) the rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, and each agent, custodian and other Person employed
to act hereunder.

Section 6.03 Individual Rights of Trustee.

                  The Trustee in its individual or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company, its
Subsidiaries, or their respective Affiliates with the same rights it would have
if it were not Trustee. Any Paying Agent or Security Registrar may do the same
with like rights. However, the Trustee must comply with Sections 6.08, 6.09 and
6.10.

Section 6.04 Trustee's Disclaimer.

                  The Trustee makes no representation as to the validity or
adequacy of this Indenture or the Securities and it shall not be accountable for
the Company's use of the proceeds from the Securities, and it shall not be
responsible for any statement in the Securities, other than the Trustee's
certificate of authentication, or the use or application of any funds received
by a Paying Agent other than the Trustee.

Section 6.05 Notice of Default.

                  If an Event of Default with respect to Securities of any
series occurs and is continuing and if it is known to the Trustee, the Trustee
shall mail to each Holder of Securities of such series notice of the uncured
Event of Default within 90 days after such Event of Default occurs. Except in
the case of an Event of Default in payment of principal (or premium, if any) of,
or interest on, any Security, the Trustee may withhold the notice if and so long
as a Responsible Officer in good faith determines that withholding the notice is
in the interest of the Holders of Securities of such series.

Section 6.06 Reports by Trustee to Holders.

                  Within 60 days after each February 15 beginning with the
February 15 following the date of this Indenture, the Trustee shall mail to each
Holder a brief report dated as of such February 15 that complies with Trust
Indenture Act Section 313(a) if such report is required by such Trust Indenture
Act Section 313(a). The Trustee also shall comply with Trust Indenture Act
Sections 313(b) and 313(c).

                  The Company shall promptly notify the Trustee in writing if
the Securities of any series become listed on any stock exchange or automatic
quotation system.

                                       40
<PAGE>
                  A copy of each report at the time of its mailing to Holders
shall be mailed to the Company and filed with the Commission and each stock
exchange, if any, on which the Securities are listed.

Section 6.07 Compensation and Indemnity.

                  The Company shall pay to the Trustee from time to time such
compensation for its services as the Company and the Trustee shall from time to
time agree in writing. The Trustee's compensation shall not be limited by any
law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable disbursements, expenses
and advances incurred or made by it. Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee's agents, accountants,
experts and counsel.

                  The Company shall indemnify each of the Trustee (in its
capacity as Trustee) and any predecessor Trustee and each of their respective
officers, directors, attorneys-in-fact and agents for, and hold it harmless
against, any claim, demand, expense (including but not limited to reasonable
compensation, disbursements and expenses of the Trustee's agents and counsel),
loss, charges (including taxes (other than taxes based upon the income of the
Trustee)) or liability incurred by them without negligence or bad faith on its
part, arising out of or in connection with the acceptance or administration of
this trust and their rights or duties hereunder including the reasonable costs
and expenses of defending themselves against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder. The Trustee shall notify the Company promptly of any claim asserted
against the Trustee for which it may seek indemnity. The Company shall defend
the claim and the Trustee shall provide reasonable cooperation at the Company's
expense in the defense. The Trustee may have separate counsel and the Company
shall pay the reasonable fees and expenses of such counsel. The Company need not
pay for any settlement made without its written consent which consent shall not
be unreasonably withheld. The Company need not reimburse any expense or
indemnify against any loss or liability to the extent incurred by the Trustee as
determined by a court of competent jurisdiction to have been caused by its own
negligence, bad faith or willful misconduct.

                  To secure the Company's payment obligations in this Section
6.07, the Trustee shall have a lien prior to the Securities on all assets held
or collected by the Trustee, in its capacity as Trustee, except assets held in
trust to pay principal and premium, if any, of or interest on particular
Securities.

                  When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 5.01(6) or (7) occurs, the expenses and
the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.

                  The Company's obligations under this Section 6.07 and any lien
arising hereunder shall survive the resignation or removal of the Trustee, the
discharge of the Company's obligations pursuant to Article IV of this Indenture
and any rejection or termination of this Indenture under any Bankruptcy Law.

                                       41
<PAGE>
Section 6.08 Replacement of Trustee.

                  The Trustee may resign at any time with respect to the
Securities of one or more series by so notifying the Company in writing. The
Holder or Holders of a majority in principal amount of the outstanding
Securities of a series may remove the Trustee with respect to Securities of such
series by so notifying the Company and the Trustee in writing and may appoint a
successor trustee with respect to Securities of such series with the Company's
consent. The Company may remove the Trustee if:

                  (1) the Trustee fails to comply with Section 6.10;

                  (2) the Trustee is adjudged bankrupt or insolvent;

                  (3) a receiver, custodian, or other public officer takes
         charge of the Trustee or its property; or

                  (4) the Trustee becomes incapable of acting.

                  If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee, with respect to the Securities of one or more series, for
any reason, the Company shall promptly appoint a successor Trustee, with respect
to Securities of that or those series. Within one year after the successor
Trustee with respect to a series of Securities takes office, the Holder or
Holders of a majority in principal amount of the Securities of such series may
appoint a successor Trustee with respect to such series to replace the successor
Trustee appointed by the Company.

                  A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that
and provided that all sums owing to the Trustee provided for in Section 6.07
have been paid, the retiring Trustee shall transfer all property held by it as
Trustee with respect to such series of Securities to the successor Trustee,
subject to the lien provided in Section 6.07, the resignation or removal of the
retiring Trustee shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this Indenture. A
successor Trustee with respect to one or more series of Securities shall mail
notice of its succession to each Holder of Securities of that or those series.

                  If a successor Trustee with respect to a series of Securities
does not take office within 60 days after the retiring Trustee resigns or is
removed, the retiring Trustee, the Company or the Holder or Holders of at least
10% in principal amount of the outstanding Securities of that series may
petition at the expense of the Company any court of competent jurisdiction for
the appointment of a successor Trustee with respect to such series.

                  If the Trustee fails to comply with Section 6.10, any Holder
of Securities of a series may petition any court of competent jurisdiction for
the removal of the Trustee with respect to such series and the appointment of a
successor Trustee with respect to such series.

                  Notwithstanding replacement of the Trustee pursuant to this
Section 6.08, the Company's obligations under Section 6.07 shall continue for
the benefit of the retiring Trustee.

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<PAGE>
Section 6.09 Successor Trustee by Merger, Etc.

                  If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall, if such resulting, surviving or transferee corporation is
otherwise eligible hereunder, be the successor Trustee.

Section 6.10 Eligibility; Disqualification.

                  The Trustee shall at all times satisfy the requirements of
Trust Indenture Act Section 310(a)(1) and Trust Indenture Act Section 310(a)(5).
The Trustee shall have a combined capital and surplus of at least $50,000,000 as
set forth in its most recent published annual report of condition. The Trustee
shall comply with Trust Indenture Act Section 310(b); provided, however, that
there shall be excluded from the operation of such Section 310(b) the Indenture
dated as of August 18, 1997, between the Company and The Bank of New York
pertaining to the Company's 7 1/2 % Senior Notes due 2007 and the Indenture
dated as of April 28, 1994, between the Company and The Bank of New York
pertaining to the Company's 8 7/8% Senior Notes due 2004.

Section 6.11 Preferential Collection of Claims against Company.

                  The Trustee shall comply with Trust Indenture Act Section
311(a), excluding any creditor relationship listed in Trust Indenture Act
Section 311(b). A Trustee who has resigned or been removed shall be subject to
Trust Indenture Act Section 311(a) to the extent indicated.

                                  ARTICLE VII

                HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY

Section 7.01 Company to Furnish Trustee Names and Addresses of Holders.

                  The Company will furnish or cause to be furnished to the
Trustee:

                  (1) semi-annually, not more than 15 days after each Regular
         Record Date, a list for each series of Securities, in such form as the
         Trustee may reasonably require, of the names and addresses of the
         Holders of Securities of such series as of the Regular Record Date, as
         the case may be, and

                  (2) at such other times as the Trustee may request in writing,
         within 30 days after the receipt by the Company of any such request, a
         list of similar form and content as of a date not more than 15 days
         prior to the time such list is furnished;

excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.

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<PAGE>
Section 7.02 Preservation of Information; Communications to Holders.

                  The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 7.01 and the names
and addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.01 upon receipt of a new list so furnished.

                  The rights of the Holders to communicate with other Holders
with respect to their rights under this Indenture or under the Securities, and
the corresponding rights and privileges of the Trustee, shall be as provided by
the Trust Indenture Act.

                  Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of any
disclosure of information as to names and addresses of Holders made pursuant to
the Trust Indenture Act.

Section 7.03 Reports by Trustee.

                  The Trustee shall transmit to Holders such reports concerning
the Trustee and its actions under this Indenture as may be required pursuant to
the Trust Indenture Act at the times and in the manner provided pursuant
thereto.

                  A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which any Securities are listed, with the Commission and with the Company. The
Company will notify the Trustee when any Securities are listed on any stock
exchange or delisted therefrom.

Section 7.04 Reports by Company.

                  The Company shall file with the Trustee and the Commission,
and transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 shall be
filed with the Trustee within 15 days after the same is so required to be filed
with the Commission. Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officer's Certificates.)

                                       44
<PAGE>
                                  ARTICLE VIII

              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

Section 8.01 When Company May Merge, Etc.

                  The Company may not, in a single transaction or through a
series of related transactions, consolidate with or merge with or into any other
person, or, directly or indirectly, sell, lease, assign, transfer or convey its
properties and assets as an entirety or substantially as an entirety (computed
on a consolidated basis) to another person or group of affiliated persons,
unless:

                  (1) the Company shall be the continuing person, or the person
         (if other than the Company) formed by such consolidation or into which
         the Company is merged or to which all or substantially all of the
         properties and assets of the Company are transferred as an entirety or
         substantially as an entirety (the Company or such other person being
         hereinafter referred to as the "Surviving Person"), shall be a
         corporation organized and validly existing under the laws of the United
         States, any State thereof or the District of Columbia, and shall
         expressly assume, by an indenture supplemental hereto, executed and
         delivered to the Trustee, in form and substance satisfactory to the
         Trustee, all the obligations of the Company under the Securities and
         this Indenture and the Indenture, so supplemented, shall remain in full
         force and effect;

                  (2) immediately after giving effect to such transaction and
         the assumption of the obligations as set forth in clause (1), above, no
         Event of Default shall have occurred and be continuing; and

                  (3) if a supplemental indenture is required in connection with
         such transaction, the Company has delivered to the Trustee an Officers'
         Certificate and an Opinion of Counsel, each stating that such
         consolidation, merger, assignment, or transfer and such supplemental
         indenture comply with this Article VIII and that all conditions
         precedent herein provided relating to such transaction have been
         satisfied.

Section 8.02 Successor Corporation Substituted.

                  Upon any consolidation or merger, or any transfer of assets in
accordance with Section 8.01, the Surviving Person formed by such consolidation
or into which the Company is merged or to which such transfer is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such Surviving
Person had been named as the Company herein. When a Surviving Person duly
assumes all of the obligations of the Company pursuant hereto and pursuant to
the Securities, the predecessor shall be relieved of the performance and
observance of all obligations and covenants of this Indenture and the
Securities, including but not limited to the obligation to make payment of the
principal of and interest, if any, on all the Securities then outstanding, and
the Company may thereupon or any time thereafter be liquidated and dissolved.

                                       45
<PAGE>
                                   ARTICLE IX

                             SUPPLEMENTAL INDENTURES

Section 9.01 Supplemental Indentures Without Consent of Holders.

                  Without the consent of any Holders, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:

                  (1) to evidence the succession of another Person to the
         Company and the assumption by any such successor of the covenants of
         the Company herein and in the Securities; or

                  (2) to add to the covenants of the Company for the, benefit of
         the Holders of all or any series of Securities (and if such covenants
         are to be for the benefit of less than all series of Securities,
         stating that such covenants are expressly being included solely for the
         benefit of such series) or to surrender any right or power herein
         conferred upon the Company; or

                  (3) to add any additional Events of Default; or

                  (4) to add to or change any of the provisions of this
         Indenture to such extent as shall be necessary to permit or facilitate
         the issuance of Securities in bearer form, registrable or not
         registrable as to principal, and with or without interest coupons, or
         to permit or facilitate the issuance of Securities in uncertificated
         form; or

                  (5) to add to, change or eliminate any of the provisions of
         this Indenture in respect of one or more series of Securities, provided
         that any such addition, change or elimination (A) shall neither (i)
         apply to any Security of any series created prior to the execution of
         such supplemental indenture and entitled to the benefit of such
         provision nor (ii) modify the rights of the Holder of any such Security
         with respect to such provision or (B) shall become effective only when
         there is no such Security Outstanding; or

                  (6) to secure the Securities pursuant to the requirements of
         Article X or otherwise; or

                  (7) to establish the form or terms of Securities of any series
         as permitted by Sections 2.01 and 3.01; or

                  (8) to evidence and provide for the acceptance of appointment
         hereunder by a successor Trustee with respect to the Securities of one
         or more series and to add to or change any of the provisions of this
         Indenture as shall be necessary to provide for or facilitate the
         administration of the trusts hereunder by more than one Trustee,
         pursuant to the requirements of Section 6.11; or

                                       46
<PAGE>
                  (9) to cure any ambiguity, to correct or supplement any
         provision herein which may be defective or inconsistent with any other
         provision herein, or to make any other provisions with respect to
         matters or questions arising under this Indenture, provided that such
         action pursuant to this clause (9) shall not adversely affect the
         interests of the Holders of Securities of any series in any material
         respect.

Section 9.02 Supplemental Indentures with Consent of Holders.

                  With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders of Securities of such series under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,

                  (1) change the Stated Maturity of the principal of, or any
         installment of principal of or interest on, any Security, or reduce the
         principal amount thereof or the rate of interest thereon or any premium
         payable upon the redemption thereof, or reduce the amount of the
         principal of an Original Issue Discount Security that would be due and
         payable upon a declaration of acceleration of the Maturity thereof
         pursuant to Section 5.02, or change any Place of Payment where, or the
         coin or currency in which, any Security or any premium or interest
         thereon is payable, or impair the right to institute suit for the
         enforcement of any such payment on or after the Stated Maturity thereof
         (or, in the case of redemption, on or after the Redemption Date), or

                  (2) reduce the percentage in principal amount of the
         Outstanding Securities of any series, the consent of whose Holders is
         required for any such supplemental indenture, or the consent of whose
         Holders is required for any waiver (of compliance with certain
         provisions of this Indenture or certain defaults hereunder and their
         consequences) provided for in this Indenture, or

                  (3) modify any of the provisions of this Section or Section
         5.13, except to increase any such percentage or to provide that certain
         other provisions of this Indenture cannot be modified or waived without
         the consent of the Holder of each Outstanding Security affected
         thereby, provided, however, that this clause shall not be deemed to
         require the consent of any Holder with respect to changes in the
         references to "the Trustee" and concomitant changes in this Section, or
         the deletion of this proviso, in accordance with the requirements of
         Sections 6.11 and 9.01(8).

A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such covenant
or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.

                                       47
<PAGE>
                  It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.

Section 9.03 Execution of Supplemental Indentures.

                  In executing, or accepting the additional trusts created by,
any supplemental indenture permitted by this Article or the modifications
thereby of the trusts created by this Indenture, the Trustee shall be entitled
to receive, and (subject to Section 6.01) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this Indenture or
otherwise.

Section 9.04 Effect of Supplemental Indentures.

                  Upon the execution of any supplemental indenture under this
Article, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes; and
every Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.

Section 9.05 Conformity with Trust Indenture Act.

                  Every supplemental indenture executed pursuant to this Article
shall conform to the requirements of the Trust Indenture Act.

Section 9.06 Reference in Securities to Supplemental Indentures.

                  Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.

                                   ARTICLE X

                                    COVENANTS

Section 10.01 Payment of Securities.

                  The Company covenants and agrees for the benefit of each
series of Securities that it will pay the principal of and interest on the
Securities of that series on the dates and in the manner provided in the
Securities of that series and this Indenture. An installment of principal,
premium, if any, or interest on the Securities shall be considered paid on the
date it is due if the Trustee or Paying Agent (other than the Company or an
Affiliate of the Company) holds for the

                                       48
<PAGE>
benefit of the Holders, on that date, immediately available funds deposited and
designated for and sufficient to pay the installment.

                  The Company shall pay interest on overdue principal and on
overdue installments of interest at the rate specified in the Securities
compounded semi-annually, to the extent lawful.

Section 10.02 Maintenance of Office or Agency.

                  The Company shall maintain in the Place of Payment for any
series of Securities, an office or agency where Securities of that series may be
presented or surrendered for payment, where Securities of that series may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities of that series and
this Indenture may be served. The Company shall give prompt written notice to
the Trustee of the location, and any change in the location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office.

                  The Company may also from time to time designate one or more
other offices or agencies where the Securities of one or more series may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain
an office or agency in each Place of Payment for Securities of any series for
such purposes. The Company shall give prompt written notice to the Trustee of
any such designation or rescission and of any change in the location of any such
other office or agency. The Company hereby initially designates the principal
corporate trust office of the Trustee as such office of the Company.

Section 10.03 Money for Securities Payments to Be Held in Trust.

                  If the Company shall at any time act as its own Paying Agent
with respect to any series of Securities, it will, on or before each due date of
the principal of or any premium or interest on any of the Securities of that
series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal and any premium and interest so
becoming due until such sums shall be paid to such Persons or otherwise disposed
of as herein provided and will promptly notify the Trustee of its action or
failure so to act.

                  Whenever the Company shall have one or more Paying Agents for
any series of Securities, it will, on or prior to each due date of the principal
of or any premium or interest on any Securities of that series, deposit with a
Paying Agent a sum sufficient to pay such amount, such sum to be held as
provided by the Trust Indenture Act, and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee of its action or failure
so to act.

                  The Company will cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will (1) comply with the
provisions of the Trust Indenture Act applicable to it as a Paying Agent and (2)
during the continuance of any default by the Company (or any other obligor upon
the Securities

                                       49
<PAGE>
of that series) in the making of any payment in respect of the Securities of
that series, upon the written request of the Trustee, forthwith pay to the
Trustee all sums held in trust by such Paying Agent for payment in respect of
the Securities of that series.

                  The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.

                  Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of or any
premium or interest on any Security of any series and remaining unclaimed for
two years after such principal, premium or interest has become due and payable
shall be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
shall thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in a newspaper published in
the English language, customarily published on each Business Day and of general
circulation in New York City, notice that such money remains unclaimed and that,
after a date specified therein, which shall not be less than 30 days from the
date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Company.

Section 10.04 Corporate Existence.

                  Subject to Article VIII, the Company shall do or cause to be
done all things necessary to preserve and keep in full force and effect its
corporate existence and the corporate or other existence of each of its
Subsidiaries in accordance with the respective organizational documents of each
of them and the rights (charter and statutory) and corporate franchises of the
Company and each of its Subsidiaries; provided, however, that the Company shall
not be required to preserve, with respect to itself, any right or franchise, and
with respect to any of its Subsidiaries, any such existence, right or franchise,
if (a) the Board of Directors of the Company shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and (b) the loss thereof is not disadvantageous in any material
respect to the Holders.

Section 10.05 Payment of Taxes and Other Claims.

                  The Company shall, and shall cause each of its Subsidiaries
to, pay or discharge or cause to be paid or discharged, before the same shall
become delinquent, (i) all taxes, assessments and governmental charges
(including withholding taxes and any penalties, interest and additions to taxes)
levied or imposed upon the Company or any of its Subsidiaries or properties and
assets of the Company or any of its Subsidiaries and (ii) all lawful claims,
whether

                                       50
<PAGE>
for labor, materials, supplies, service or anything else, which have become due
and payable and which by law have or may become a Lien upon the property and
assets of the Company or any of its Subsidiaries; provided, however, that the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim whose amount, applicability
or validity is being contested in good faith by appropriate proceedings and for
which disputed amounts adequate reserves have been established in accordance
with generally accepted accounting principles.

Section 10.06 Compliance Certificate; Notice of Default.

                  (a) The Company shall deliver to the Trustee within 120 days
after the end of its fiscal year an Officers' Certificate (one of the
signatories of which shall be the Company's principal executive officer,
principal financial officer or principal accounting officer) complying with
Section 314(a)(4) of the Trust Indenture Act and stating that a review of its
activities and the activities of its Subsidiaries during the preceding fiscal
year has been made under the supervision of the signing officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture (all without regard to periods of grace, which
shall be deemed fulfilled unless and until the expiration of such periods) or
notice requirements) and further stating, as to each such officer signing such
certificate, whether or not the signer knows of any failure by the Company or
any Subsidiary of the Company to comply with any conditions or covenants in this
Indenture and, if such signer does know of such a failure to comply, the
certificate shall describe such failure with particularity. The Officers'
Certificate shall also notify the Trustee should the relevant fiscal year end on
any date other than the current fiscal year end date.

                  (b) The Company shall, so long as any of the Securities of any
series are outstanding, deliver to the Trustee, immediately upon becoming aware
of any Event of Default with respect to such series under this Indenture, an
Officers' Certificate specifying such Event of Default and what action the
Company is taking or proposes to take with respect thereto. The Trustee shall
not be deemed to have knowledge of a an Event of Default unless one of its
Responsible Officers receives notice of the Event of Default giving rise thereto
from the Company or any of the Holders.

Section 10.07 Waiver of Stay, Extension or Usury Laws.

                  The Company covenants for the benefit of each series of
Securities (to the extent that it may lawfully do so) that it will not at any
time insist upon, plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay or extension law or any usury law or other law
wherever enacted which would prohibit or forgive the Company from paying all or
any portion of the principal of or interest on the Securities of that series as
contemplated herein, wherever enacted, now or at any time hereafter in force, or
which may affect the covenants or the performance of this Indenture; and (to the
extent that it may lawfully do so) the Company hereby expressly waives for the
benefit of each series of Securities all benefit or advantage of any such law
insofar as such law applies to the Securities of that series, and covenants for
the benefit of each series of Securities that it shall not hinder, delay or
impede the execution of any power herein granted to the Trustee with respect to
that series, but will suffer and permit the execution of every such power as
though no such law had been enacted.

                                       51
<PAGE>
Section 10.08 Limitation on Liens.

                  The Company shall not, and shall not permit any of its
Material Subsidiaries to, issue, incur, assume or guarantee any Indebtedness for
borrowed money secured by a Lien (other than Permitted Liens) upon any shares of
the Voting Stock of a Material Subsidiary which shares are owned by the Company
or its Material Subsidiaries without effectively providing that the Securities
(and if the Company so elects, any other indebtedness of the Company ranking on
a parity with the Securities) shall be secured equally and ratably with, or
prior to, any such secured Indebtedness so long as such Indebtedness remains
outstanding.

                                   ARTICLE XI

                            REDEMPTION OF SECURITIES

Section 11.01 Applicability of Article.

                  Securities of any series which are redeemable before their
Stated Maturity shall be redeemable in accordance with their terms and (except
as otherwise specified as contemplated by Section 3.01 for Securities of any
series) in accordance with this Article.

Section 11.02 Election to Redeem; Notice to Trustee.

                  The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution. In case of any redemption at the election of
the Company of less than all the Securities of any series, the Company shall, at
least 60 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date, of the principal amount of Securities of such series to be
redeemed and, if applicable, of the tenor of the Securities to be redeemed. In
the case of any redemption of Securities prior to the expiration of any
restriction on such redemption provided in the terms of such Securities or
elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restriction.

Section 11.03 Selection by Trustee of Securities to Be Redeemed.

                  If less than all the Securities of any series are to be
redeemed (unless all of the Securities of such series and of a specified tenor
are to be redeemed), the particular Securities to be redeemed shall be selected
not more than 60 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities of such series not previously called for redemption, by
such method as the Trustee shall deem fair and appropriate and which may provide
for the selection for redemption of portions (equal to the minimum authorized
denomination for Securities of that series or any integral multiple thereof) of
the principal amount of Securities of such series of a denomination larger than
the minimum authorized denomination for Securities of that series. If less than
all of the Securities of such series and of a specified tenor are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than 60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series and specified tenor not previously called for
redemption in accordance with the preceding sentence.

                                       52
<PAGE>
                  The Trustee shall promptly notify the Company in writing of
the Securities selected for redemption and, in the case of any Securities
selected for partial redemption, the principal amount thereof to be redeemed.

                  For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.

Section 11.04 Notice of Redemption.

                  Notice of redemption shall be given by first-class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
Redemption Date, to each Holder of Securities to be redeemed, at his address
appearing in the Security Register.

                  All notices of redemption shall state:

                  (1) the Redemption Date,

                  (2) the Redemption Price,

                  (3) if less than all the Outstanding Securities of any series
         are to be redeemed, the identification (and, in the case of partial
         redemption of any Securities, the principal amounts) of the particular
         Securities to be redeemed,

                  (4) that on the Redemption Date the Redemption Price will
         become due and payable upon each such Security to be redeemed and, if
         applicable, that interest thereon will cease to accrue on and after
         said date,

                  (5) the place or places where such Securities are to be
         surrendered for payment of the Redemption Price,

                  (6) that the redemption is for a sinking fund, if such is the
         case, and

                  (7) applicable CUSIP Numbers.

                  Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company and shall
be irrevocable.

Section 11.05 Deposit of Redemption Price.

                  Prior to any Redemption Date, the Company shall deposit with
the Trustee or with a Paying Agent an amount of money sufficient to pay the
Redemption Price of, and (except if the Redemption Date shall be an Interest
Payment Date) accrued interest on, all the Securities which are to be redeemed
on that date.

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<PAGE>
Section 11.06 Securities Payable on Redemption Date.

                  Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified, and from and after such date
(unless the Company shall default in the payment of the Redemption Price and
accrued interest) such Securities shall cease to bear interest. Upon surrender
of any such Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price, together with
accrued interest to the Redemption Date; provided, however, that, unless
otherwise specified as contemplated by Section 3.01, installments of interest
whose Stated Maturity is on or prior to the Redemption Date shall be payable to
the Holders of such Securities, or one or more Predecessor Securities,
registered as such at the close of business on the relevant Record Dates
according to their terms and the provisions of Section 3.07.

                  If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal and any premium shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.

Section 11.07 Securities Redeemed in Part.

                  Any Security which is to be redeemed only in part shall be
surrendered at a Place of Payment therefor (with, if the Company or the Trustee
so requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed by, the Holder thereof
or his attorney duly authorized in writing), and the Company shall execute, and
the Trustee shall authenticate and deliver to the Holder of such Security
without service charge, a new Security or Securities of the same series and of
like tenor, of any authorized denomination as requested by such Holder, in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.

                                  ARTICLE XII

                                  SINKING FUNDS

Section 12.01 Applicability of Article.

                  The provisions of this Article shall be applicable to any
sinking fund for the retirement of Securities of a series except as otherwise
specified as contemplated by Section 3.01 for Securities of such series.

                  The minimum amount of any sinking fund payment provided for by
the terms of Securities of any series is herein referred to as a "mandatory
sinking fund payment", and any payment in excess of such minimum amount provided
for by the terms of Securities of any series is herein referred to as an
"optional sinking fund payment". If provided for by the terms of Securities of
any series, the cash amount of any sinking fund payment may be subject to
reduction as provided in Section 12.02. Each sinking fund payment shall be
applied to the redemption of Securities of any series as provided for by the
terms of Securities of such series.

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<PAGE>
Section 12.02 Satisfaction of Sinking Fund Payments with Securities.

                  The Company (1) may deliver Outstanding Securities of a series
(other than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Company pursuant to the terms of such Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment with respect to the Securities of such series required to be made
pursuant to the terms of such Securities as provided for by the terms of such
series; provided that such Securities have not been previously so credited. Such
Securities shall be received and credited for such purpose by the Trustee at the
Redemption Price specified in such Securities for redemption through operation
of the sinking fund and the amount of such sinking fund payment shall be reduced
accordingly.

Section 12.03 Redemption of Securities for Sinking Fund.

                  Not less than 60 days prior to each sinking fund payment date
for any series of Securities, the Company will deliver to the Trustee an
Officers' Certificate specifying the amount of the next ensuing sinking fund
payment for that series pursuant to the terms of that series, the portion
thereof, if any, which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivering and crediting Securities
of that series pursuant to Section 12.02 and will also deliver to the Trustee
any Securities to be so delivered. Not less than 30 days before each such
sinking fund payment date the Trustee shall select the Securities to be redeemed
upon such sinking fund payment date in the manner specified in Section 11.03 and
cause notice of the redemption thereof to be given in the name of and at the
expense of the Company in the manner provided in Section 11.04. Such notice
having been duly given, the redemption of such Securities shall be made upon the
terms and in the manner stated in Sections 11.06 and 11.07.

                                  ARTICLE XIII

                       REDEMPTION UPON A DESIGNATED EVENT
                              AND A RATING DECLINE

Section 13.01 Redemption by Holders.

                  Subject to Section 3.01(14), in the event that there occurs
(a) a Designated Event (as hereinafter defined) at any time on or prior to
Maturity, and (b) a Rating Decline (as hereinafter defined), each Holder of a
Security that is of a series to which this Article XIII is applicable (for
purposes of this Article XIII, a "Subject Security") shall have the right, at
the Holder's option, to require the Company to redeem all or any portion (which
shall be $1,000 or an integral multiple thereof) of such Subject Security on the
date that is 90 days after the last to occur of public notice of the occurrence
of the Designated Event and the Rating Decline, at a redemption price equal to
100% of the principal amount thereof, plus accrued interest to the Redemption
Date.

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<PAGE>
                  On or before the twenty-eighth day after the last to occur of
public notice of the occurrence of the Designated Event and the Rating Decline,
the Company is obligated to notify the Trustee of such events, and promptly
thereafter to mail, or cause to be mailed first-class, postage prepaid, to each
Holder of any Subject Securities, at the address of such Holder appearing in the
Security Register, a notice regarding the Designated Event, the Rating Decline,
and the redemption right. The notice shall include the Redemption Date, the date
by which the redemption right must be exercised, the Redemption Price, and the
procedure which the Holder must follow to exercise this right.

                  To exercise this right, the Holder of such Subject Securities
must deliver on or before a date selected by the Company, which date shall be
not more than 10 days prior to the Redemption Date, written notice to the
Company (or an agent designated by the Company for such purpose) of the Holder's
exercise of such right, together with the Subject Securities with respect to
which the right is being exercised, duly endorsed or assigned to the Company or
in blank. Such written notice by a Holder shall, unless otherwise required by
law, be irrevocable.

                  As used herein, a "Designated Event" shall be deemed to have
occurred at such a time as any "person" or "group" (as such terms are used for
purposes of Sections 13(d) and 14(d) of the Exchange Act, whether or not
applicable) becomes the "beneficial owner" (as the term is used in Rules 13d-3
and 13d-5 under the Exchange Act, whether or not applicable, except that a
person shall be deemed to have "beneficial ownership" of all shares that any
such person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time), directly or indirectly, of more
than 50% of the total voting power entitled to vote in the election of directors
of the Company; provided, however, that a Designated Event shall not be deemed
to have occurred (i) as a result of the formation of such a "group" or the
acquisition of shares of Capital Stock of the Company by such group if such
group includes existing Affiliates and/or persons who beneficially own in the
aggregate, as of the date of this Indenture, 20% or more of the outstanding
shares of Capital Stock of the Company on the date of this Indenture, or (ii) by
virtue of the Company, any Subsidiary, any employee stock ownership plan or any
other employee benefit plan of the Company or any Subsidiary, or any other
person holding Capital Stock of the Company for or pursuant to the terms of any
such employee benefit plan, becoming a beneficial owner, directly or indirectly,
of more than 50% of the total voting power entitled to vote in the election of
directors of the Company.

                  As used herein, a "Rating Decline" shall be deemed to have
occurred if on any date within the 90-day period following public notice of the
occurrence of a Designated Event (which 90-day period shall be extended with
respect to either Rating Agency (as hereinafter defined) for so long as the
rating of the Securities is under publicly announced consideration for possible
downgrade relating to such Designated Event by such Rating Agency) (i) in the
event the Securities are rated by one Rating Agency or by both Rating Agencies
on the Rating Date (as hereinafter defined) as Investment Grade (as hereinafter
defined), the rating of the Securities by such Rating Agency or by either of
such Rating Agencies (as the case may be) shall be below Investment Grade; or
(ii) in the event the Securities are rated by both Rating Agencies on the Rating
Date below Investment Grade, the rating of the Securities by either Rating
Agency shall be at least one Full Rating Category (as hereinafter defined) below
the rating of the Securities by such Rating Agency on the Rating Date.

                                       56
<PAGE>
                  As used herein, "Rating Agency" shall mean Standard & Poor's
Corporation and its successors ("S&P"), and Moody's Investors Service and its
successors ("Moody's"), or if S&P or Moody's or both shall not make a rating on
the Securities publicly available, a nationally recognized statistical rating
organization or organizations, as the case may be, selected by the Company which
shall be substituted for S&P or Moody's or both, as the case may be; "Investment
Grade" shall mean BBB- or higher by S&P or Baa3 or higher by Moody's or the
equivalent of such ratings by S&P or Moody's or by any other Rating Agency
selected as provided above, and "Rating Date" shall mean the date which is 121
days prior to public notice of the occurrence of a Designated Event.

                  As used herein, the term, "Full Rating Category" shall mean
(i) with respect to S&P, any of the following categories BB, B, CCC, CC, and C;
(ii) with respect to Moody's, any of the following categories: Ba, B, Caa, Ca,
and C; and (iii) with respect to any other Rating Agency, the equivalent of any
such category of S&P or Moody's used by such other Rating Agency. In determining
whether the rating of the Securities has decreased by the equivalent of one Full
Rating Category, gradation within Full Rating Categories (+ and - for S&P, 1, 2,
and 3 for Moody's; or the equivalent gradation for another Rating Agency) shall
be taken into account (e.g., with respect to S&P, a decline in a rating from BB+
to BB-, or from BB to B+, will constitute a decrease of less than one Full
Rating Category).

Section 13.02 Redemption by Company.

                  In the event the aggregate principal amount of the Subject
Securities that are surrendered for redemption on any such Redemption Date is a
least 90% of the aggregate principal amount of the Subject Securities
Outstanding at the close of business on the day next preceding such Redemption
Date, the remaining Subject Securities not so redeemed will be subject to
redemption as a whole, at the Company's option, upon not less than 30 days'
notice mailed to each Holder at the address of such Holder appearing in the
Security Register, on a date of redemption selected by the Company that is
within 60 days after such Redemption Date, at a Redemption Price equal to 100%
of the principal amount, plus accrued interest to such date of redemption
selected by the Company.

Section 13.03 Other Provisions.

                  With respect to any redemption at the option of the Holders of
Securities, as hereinabove provided, (x) the first clause of Section 11.06 shall
read as follows: "Notice by the Holder of such Holder's exercise of the
redemption right having been duly given," and (y) if any Security delivered by
the Holder upon exercise of the redemption right is, at the option of the
Holder, to be redeemed in part only, the written notice delivered by the Holder
to the Company as aforesaid shall state the principal amount of the Security
which is to be redeemed.

                  Notwithstanding the foregoing, the Holders shall not have the
redemption right described above if, prior to the occurrence of the Designated
Event, the Company has effected a defeasance or covenant defeasance of the
Securities as provided in Article XIV.

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<PAGE>
                                  ARTICLE XIV

                       DEFEASANCE AND COVENANT DEFEASANCE

Section 14.01 Company's Option to Effect Defeasance or Covenant Defeasance.

                  The Company may elect, at its option by Board Resolution at
any time, to have either Section 14.02 or Section 14.03 applied to the
Outstanding Securities of any series designated pursuant to Section 3.01 as
being defeasible pursuant to this Article XIV (hereinafter called a "Defeasible
Series"), upon compliance with the conditions set forth below in this Article
XIV.

Section 14.02 Defeasance and Discharge.

                  Upon the Company's exercise of the option provided in Section
14.01 to have this Section 14.02 applied to the Outstanding Securities of any
Defeasible Series and subject to the proviso to Section 14.01, the Company shall
be deemed to have been discharged from its obligations with respect to the
Outstanding Securities of such series as provided in this Section on and after
the date the conditions set forth in Section 14.04 are satisfied (hereinafter
called "Defeasance"). For this purpose, such Defeasance means that the Company
shall be deemed to have paid and discharged the entire indebtedness represented
by the Outstanding Securities of such series and to have satisfied all its other
obligations under the Securities of such series and this Indenture insofar as
the Securities of such series are concerned (and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging the same), subject
to the following which shall survive until otherwise terminated or discharged
hereunder: (1) the rights of Holders of Securities of such series to receive,
solely from the trust fund described in Section 14.04 and as more fully set
forth in such Section, payments in respect of the principal of and any premium
and interest on such Securities of such series when payments are due, (2) the
Company's obligations with respect to the Securities of such series under
Sections 3.04, 3.05, 3.06, 10.02 and 10.03, (3) the rights, powers, trusts,
duties and immunities of the Trustee hereunder and (4) this Article XIV. Subject
to compliance with this Article XIV, the Company may exercise its option
provided in Section 14.01 to have this Section 14.02 applied to the Outstanding
Securities of any Defeasible Series notwithstanding the prior exercise of its
option provided in Section 14.01 to have Section 14.03 applied to the
Outstanding Securities of such series.

Section 14.03 Covenant Defeasance.

                  Upon the Company's exercise of the option provided in Section
14.01 to have this Section 14.03 applied to the Outstanding Securities of any
Defeasible Series, (1) the Company shall be released from its obligations under
Section 8.01, and Sections 10.04, 10.05 and 10.08, and Article XIII, and (2) the
occurrence of any event specified in Sections 5.01(3), 5.01(4) (with respect to
any of Sections 8.01, 10.04, 10.05 and 10.08, and Article XIII), 5.01(5) and
5.01(8) shall be deemed not to be or result in an Event of Default, in each case
with respect to the Outstanding Securities of such series as provided in this
Section on and after the date the conditions set forth in Section 14.04 are
satisfied (hereinafter called "Covenant Defeasance"). For this purpose, such
Covenant Defeasance means that the Company may omit to comply with

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<PAGE>
and shall have no liability in respect of any term, condition or limitation set
forth in any such specified Section (to the extent so specified in the case of
Section 5.01(4)), whether directly or indirectly by reason of any reference
elsewhere herein to any such Section or by reason of any reference in any such
Section to any other provision herein or in any other document, but the
remainder of this Indenture and the Securities of such series shall be
unaffected thereby.

Section 14.04 Conditions to Defeasance or Covenant Defeasance.

                  The following shall be the conditions to application of either
Section 14.02 or Section 14.03 to the Outstanding Securities of any Defeasible
Series:

                  (1) The Company shall irrevocably have deposited or caused to
         be deposited with the Trustee (or another trustee that satisfies the
         requirements contemplated by Section 6.09 and agrees to comply with the
         provisions of this Article XIV applicable to it) as trust funds in
         trust for the purpose of making the following payments, specifically
         pledged as security for, and dedicated solely to, the benefit of the
         Holders of Outstanding Securities of such series, (A) money in an
         amount, or (B) U.S. Government Obligations that through the scheduled
         payment of principal and interest in respect thereof in accordance with
         their terms will provide, not later than one day before the due date of
         any payment, money in an amount, or (C) a combination thereof, in each
         case sufficient, in the opinion of a nationally recognized firm of
         independent public accountants expressed in a written certification
         thereof delivered to the Trustee, to pay and discharge, and which shall
         be applied by the Trustee (or any such other qualifying trustee) to pay
         and discharge, the principal of and any premium and interest on the
         Securities of such series on the respective Stated Maturities, in
         accordance with the terms of this Indenture and the Securities of such
         series. As used herein, "U.S. Government Obligation" means (x) any
         security that is (i) a direct obligation of the United States of
         America for the payment of which full faith and credit of the United
         States of America is pledged or (ii) an obligation of a Person
         controlled or supervised by and acting as an agency or instrumentality
         of the United States of America the payment of which is unconditionally
         guaranteed as a full faith and credit obligation by the United States
         of America, which, in either case (i) or (ii), is not callable or
         redeemable at the option of the issuer thereof, and (y) any depositary
         receipt issued by a bank (as defined in Section 3(a)(2) of the
         Securities Act of 1933, as amended) as custodian with respect to any
         U.S. Government Obligation specified in Clause (x) and held by such
         custodian for the account of the holder of such depositary receipt, or
         with respect to any specific payment of principal of or interest on any
         such U.S. Government Obligation, provided that (except as required by
         law) such custodian is not authorized to make any deduction from the
         amount payable to the holder of such depositary receipt from any amount
         received by the custodian in respect of the U.S. Government Obligation
         or the specific payment of principal or interest evidenced by such
         depositary receipt.

                  (2) In the case of an election under Section 14.02, the
         Company shall have delivered to the Trustee an Opinion of Counsel
         stating that (A) the Company has received from, or there has been
         published by, the Internal Revenue Service a ruling or (B) since the
         date first set forth hereinabove, there has been a change in the
         applicable Federal income tax law, in either case (A) or (B) to the
         effect that, and based thereon such

                                       59
<PAGE>
         opinion shall confirm that, the Holders of the Outstanding Securities
         of such series will not recognize gain or loss for Federal income tax
         purposes as a result of the deposit, Defeasance and discharge to be
         effected with respect to the Securities of such series and will be
         subject to Federal income tax on the same amount, in the same manner
         and at the same times as would be the case if such deposit, Defeasance
         and discharge were not to occur.

                  (3) In the case of an election under Section 14.03, the
         Company shall have delivered to the Trustee an Opinion of Counsel to
         the effect that the Holders of the Outstanding Securities of such
         series will not recognize gain or loss for Federal income tax purposes
         as a result of the deposit and Covenant Defeasance to be effected with
         respect to the Securities of such series and will be subject to Federal
         income tax on the same amount, in the same manner and at the same times
         as would be the case if such deposit and Covenant Defeasance were not
         to occur.

                  (4) The Company shall have delivered to the Trustee an
         Officer's Certificate to the effect that the Securities of such series,
         if then listed on any securities exchange, will not be delisted as a
         result of such deposit.

                  (5) No Event of Default or event that (after notice or lapse
         of time or both) would become an Event of Default shall have occurred
         and be continuing at the time of such deposit or, with regard to any
         Event of Default or any such event specified in Sections 5.01(6) and
         (7), at any time on or prior to the 90th day after the date of such
         deposit (it being understood that this condition shall not be deemed
         satisfied until after such 90th day).

                  (6) Such Defeasance or Covenant Defeasance shall not cause the
         Trustee to have a conflicting interest within the meaning of the Trust
         Indenture Act (assuming all Securities are in default within the
         meaning of such Act).

                  (7) Such Defeasance or Covenant Defeasance shall not result in
         a breach or violation of, or constitute a default under, any other
         agreement or instrument to which the Company is a party or by which it
         is bound.

                  (8) The Company shall have delivered to the Trustee an
         Officer's Certificate and an Opinion of Counsel, each stating that all
         conditions precedent with respect to such Defeasance or Covenant
         Defeasance have been complied with.

                  (9) Such Defeasance or Covenant Defeasance shall not result in
         the trust arising from such deposit constituting an investment company
         within the meaning of the Investment Company Act of 1940, as amended,
         unless such trust shall be qualified under such Act or exempt from
         regulation thereunder.

Section 14.05 Deposited Money and U.S. Government Obligations to be Held in
              Trust; Other Miscellaneous Provisions.

                  All money and U.S. Government Obligations (including the
proceeds thereof) deposited with the Trustee or other qualifying trustee (solely
for purposes of this Section and

                                       60
<PAGE>
Section 14.06, the Trustee and any such other trustee are referred to
collectively as the "Trustee") pursuant to Section 14.04 in respect of the
Securities of any Defeasible Series shall be held in trust and applied by the
Trustee, in accordance with the provisions of the Securities of such series and
this Indenture, to the payment, either directly or through any such Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of Securities of such series, of all sums due and to
become due thereon in respect of principal and any premium and interest, but
money so held in trust need not be segregated from other funds except to the
extent required by law.

                  The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 14.04 or the principal and interest
received in respect thereof other than any such tax, fee or other charge that by
law is for the account of the Holders of Outstanding Securities.

                  Anything in this Article XIV to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 14.04 with respect to Securities of any Defeasible Series that, in the
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are in
excess of the amount thereof that would then be required to be deposited to
effect an equivalent Defeasance or Covenant Defeasance with respect to the
Securities of such series.

Section 14.06 Reinstatement.

                  If the Trustee or the Paying Agent is unable to apply any
money in accordance with this Article XIV with respect to the Securities of any
series by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
Company's obligations under this Indenture and the Securities of such series
shall be revived and reinstated as though no deposit had occurred pursuant to
this Article XIV with respect to Securities of such series until such time as
the Trustee or Paying Agent is permitted to apply all money held in trust
pursuant to Section 14.05 with respect to Securities of such series in
accordance with this Article XIV; provided, however, that if the Company makes
any payment of principal of or any premium or interest on any Security of such
series following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of Securities of such series to receive
such payment from the money so held in trust.

                  This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.

                           (Signature Page to Follow)

                                       61
<PAGE>
                  IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the day and year first above written.


                                            JEFFERIES GROUP, INC.

                                            By:
                                                -------------------------------
                                                Name:
                                                Title:


                                            THE BANK OF NEW YORK

                                            By:
                                                -------------------------------
                                                Name:
                                                Title:



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