Exhibit 4(b)(16)



UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (55 WATER STREET, NEW YORK, NEW YORK) TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS
MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.

REGISTERED                                                   $

No. FL-                                                      CUSIP #

                         THE BEAR STEARNS COMPANIES INC.

                           MEDIUM-TERM NOTE, SERIES B
                                 (FLOATING RATE)


Original Issue Date: July 12, 2004              Interest Reset Date(s): *

Initial Maturity Date: August 5, 2005,          Interest Reset Period: **
   or if such day is not a Business
   Day, the immediately preceding               Interest Payment Date(s): ***
   Business Day
                                                Interest Payment Period: Monthly
Option to Extend Maturity: Yes
                                                Redeemable On and After:  N/A
Final Maturity Date: August 5, 2009,
   or if such day is not a Business             Optional Repayment Date(s): N/A
   Day, the immediately preceding
   Business Day                                 Election Date(s): ****

Interest Rate Basis:  LIBOR Telerate            Notice Period(s): *****

Initial Interest Rate:  1.38313%

Index Maturity:  One Month

Spread (plus or minus): ^

Maximum Interest Rate:  N/A

Minimum Interest Rate:  N/A

Minimum Denominations: $25,000, increased in multiples of $1,000

<PAGE>

*     Commencing August 5, 2004 and on the 5th day of each month thereafter
      prior to the relevant maturity date.

**    The first Interest Reset Period will be the period from and including
      August 5, 2004 to but excluding the immediately succeeding Interest Reset
      Date. Thereafter, the Interest Reset Periods will be the periods from and
      including an Interest Reset Date to but excluding the immediately
      succeeding Interest Reset Date; provided that the final Interest Reset
      Period for the Notes, or any Notes maturing prior to the Final Maturity
      Date, will be the period from and including the Interest Reset Date in the
      month immediately preceding the maturity of the Notes, or any portion of
      the Notes, to the relevant maturity date.

***   Commencing August 5, 2004 and on the 5th day of each month thereafter,
      including the Final Maturity Date. The final Interest Payment Date for the
      Notes, or any portion of the Notes maturing prior to the Final Maturity
      Date, will be the maturity date, and interest for the final Interest
      Payment Period will accrue from and including the Interest Payment Date in
      the month immediately preceding such maturity date to but excluding the
      maturity date.

****  Commencing August 5, 2004, the election date shall be the 5th calendar day
      of each month from August 2004 to July 2008 inclusive, whether or not such
      day is a Business Day.

***** The notice period for each election date will begin on the 5th Business
      Day prior to but not including the election date and end on the election
      date; however, if that election date is not a Business Day, the notice
      period will be extended to the following Business Day.

^     The table below indicates the applicable Spread for the Interest Reset
      Dates occurring during each of the indicated periods.

      For Interest Reset Dates occurring:                              Spread:
      ----------------------------------                               ------

      From the Original Issue Date to but excluding 8/5/2005:          + .02%

      From and including 8/5/2005 to but excluding 8/5/2006:           + .05%

      From and including 8/5/2006 to but excluding 8/5/2007:           + .08%

      From and including 8/5/2007 to but excluding 8/5/2008:           + .10%

      From and including 8/5/2008 to but excluding 8/5/2009:           + .11%


OPTION TO EXTEND MATURITY

      The Notes will mature on the Initial Maturity Date, unless the maturity of
all or any portion of the principal amount of the Notes is extended in
accordance with the procedures described below. In no event will the maturity of
the Notes be extended beyond the Final Maturity Date.

      During the notice period for each election date, the Holder may elect to
extend the maturity of all or any portion of the principal amount of such
Holder's Notes so that the maturity of such Notes will be extended to the date
occurring 366 calendar days from and including the 5th day of the next
succeeding month. However, if that 366th calendar day is not a Business Day, the
maturity of such Holder's Notes will be extended to the immediately preceding
Business Day. The election dates will be the 5th calendar day of each month from
August 2004 to July 2008 inclusive, whether or not any such day is a Business
Day.

      To exercise the option to extend the Note in whole or in part, this Note
and the duly completed form entitled "Option to Extend Maturity" below must be
received, by the Trustee at its office at 4 New York Plaza, New York, New York,
10004, Attention: Debt Operations - 13th Floor, or at such address which the
Company shall from time to time notify the Holders of the Notes (any such office
being the "Corporate Trust Office"), no later than the close of business, New
York City time, on the last Business Day during the notice period for the
relevant election date.

                                      -2-
<PAGE>

      The Holder may elect to extend the maturity of all of such Holder's Notes
or of any portion thereof having a principal amount of $25,000 or any multiple
of $1,000 in excess thereof. To make the election effective on any election
date, the Holder must deliver a notice of election, as described above, during
the notice period for that election date. The notice period for each election
date will begin on the 5th Business Day prior to the election date and end on
the election date; however, if that election date is not a Business Day, the
notice period will be extended to the following Business Day. The Holder's
notice of election must be delivered to the Trustee, through the normal clearing
system channels described in more detail below, no later than the last Business
Day of the notice period. Upon delivery to the Trustee of a notice of election
to extend the maturity of the Notes or any portion thereof during a notice
period, that election will be revocable during each day of such notice period,
until 12:00 noon (New York City time) on the last Business Day in such notice
period, at which time such notice will become irrevocable.

      If on any election date the Holder does not make an election to extend the
maturity of all or any portion of the principal amount of such Holder's Notes,
the principal amount of the Notes for which the Holder has failed to make such
an election will become due and payable on the Initial Maturity Date, or any
later date to which the maturity of such Holder's Notes has previously been
extended. The principal amount of the Notes for which such election is not
exercised will be represented by a note issued on such election date. The new
note so issued will have the same terms as the Notes, except that it will not be
extendible, will have a separate CUSIP number and its maturity date will be the
date that is 366 calendar days from and including such election date or, if such
366th calendar day is not a Business Day, the immediately preceding Business
Day. The failure to elect to extend the maturity of all or any portion of the
Notes will be irrevocable and will be binding upon any subsequent Holder of such
Notes. To the extent that the Trustee has not received a duly completed "Option
to Extend Maturity" form within the relevant election period in accordance with
the terms of this Note as to all or part of the principal amount of this Note,
the Trustee shall issue a new note representing such principal amount and reduce
or cause to be reduced the outstanding principal amount of this Note by such
amount.

      The Notes will bear interest from the date of issuance until the principal
amount thereof is paid or made available for payment at a rate determined for
each Interest Reset Period by reference to the Interest Rate Basis, based on the
Index Maturity, plus the applicable Spread for the relevant Interest Reset Date.

      A Holder must exercise the option to extend the maturity of such Holder's
Notes through The Depository Trust Company ("DTC"), as depositary for the Notes.
To ensure that DTC will receive timely notice of such Holder's election to
extend the maturity of all or a portion of such Holder's Notes, so that DTC can
deliver notice of such Holder's election to the Trustee prior to the close of
business on the last Business Day in the notice period, the Holder must instruct
the direct or indirect participant through which the Holder holds an interest in
the Notes to notify DTC of such Holder's election to extend the maturity of such
Holder's Notes in accordance with the then applicable operating procedures of
DTC. Notice of any decision to revoke such Holder's election must be made
through the same clearing system channels.

      DTC must receive any notice of election no later than 12:00 noon (New York
City time) on the last Business Day in the notice period for any election date.
The Holder should consult the direct or indirect participant through which it
holds an interest in the Notes to ascertain the deadline for ensuring that
timely notice will be delivered to DTC. If the election date is not a Business
Day, notice of the Holder's election to extend the maturity date of the Notes
must be delivered to DTC by its participants no later than 12:00 noon (New York
City time) on the first Business Day following the election date.

      For purposes of the Holder's exercise of an election to extend the
maturity of all or any portion of such Holder's Notes, "Business Day" means any
day that is not a Saturday or Sunday, and that is neither a legal holiday nor a
day on which banking institutions or trust companies in New York City are
authorized or obligated by law to close.

                                      -3-
<PAGE>

      THE BEAR STEARNS COMPANIES INC., a Delaware corporation (the "Company"),
for value received, hereby promises to pay to CEDE & CO., or registered assigns,
the principal amount stated above on the Final Maturity Date shown above (the
"Maturity Date") (or such lesser amount as shall not have been earlier exchanged
for other notes pursuant to the terms hereof) and to pay interest thereon at the
rate per annum equal to the Initial Interest Rate shown above until the first
Interest Reset Date shown above following the Original Issue Date shown above
and thereafter at a rate determined in accordance with the provisions on the
reverse hereof under the heading "Determination of Commercial Paper Rate,"
"Determination of LIBOR," "Determination of Federal Funds Rate," "Determination
of Treasury Rate," "Determination of Prime Rate" or "Determination of CMT Rate"
depending upon whether the Interest Rate Basis is Commercial Paper Rate, LIBOR,
Federal Funds Rate, Treasury Rate, Prime Rate or CMT Rate, as indicated above,
until the principal hereof is fully paid or duly made available for payment. The
Company will pay interest monthly, quarterly, semiannually or annually as
indicated above on each Interest Payment Date shown above commencing with the
first Interest Payment Date shown above immediately following the Original Issue
Date shown above, and on the Maturity Date or, if applicable, the Redemption
Date or Optional Repayment Date; provided, however, that if the Original Issue
Date shown above is between a Regular Record Date (as defined below) and an
Interest Payment Date, interest payments will commence on the Interest Payment
Date following the next succeeding Regular Record Date; and provided, further,
however, that if an Interest Payment Date, Maturity Date, Redemption Date or
Optional Repayment Date would fall on a day that is not a Business Day (as
defined on the reverse hereof), unless otherwise specified on the face hereof,
the related payment of principal, premium, if any, or interest shall be made on
the following day that is a Business Day, and no interest shall accrue for the
period from and after that Interest Payment Date, Maturity Date, Redemption Date
or Optional Repayment Date, as the case may be, to the next Business Day. In the
event the Interest Rate Basis is LIBOR, as indicated above, if such next
Business Day falls in the next calendar month, principal, premium, if any, or
interest will be paid on the preceding day that is a Business Day, provided that
any such Business Day is also a London Banking Day (as defined on the reverse
hereof), with respect to such LIBOR Note. Except as provided above and in the
Indenture referred to on the reverse hereof, interest payments will be made on
the Interest Payment Dates shown above. The "Regular Record Date" shall be the
date whether or not a Business Day 15 calendar days immediately preceding such
Interest Payment Date, unless otherwise specified on the face hereof.

      The interest so payable, and punctually paid or duly provided for, on the
Interest Payment Dates referred to above, will, as provided in the Indenture, be
paid to the Person in whose name this Note (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest, provided, however, that interest payable on the Maturity
Date, or if applicable, the Redemption Date or Optional Repayment Date, will be
paid to the Person to whom the principal of this Note is payable. Any such
interest which is payable, but is not punctually paid or duly provided for, on
any Interest Payment Date shall forthwith cease to be payable to the Holder on
such Regular Record Date, and may be paid to the Person in whose name this Note
(or one or more Predecessor Securities) is registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Trustee, notice whereof shall be given to the Holder of this Note not
less than ten days prior to such Special Record Date, or may be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Notes may be listed and upon such notice as may
be required by such exchange, all as more fully provided in the Indenture.

                                      -4-
<PAGE>

      Payment of the principal of and interest on this Note shall be made at the
office or agency of the Trustee maintained for that purpose in the Borough of
Manhattan, The City of New York, in such coin or currency of the United States
of America as at the time of payment is legal tender for the payment of public
and private debt; provided, however, that payment of interest on any Interest
Payment Date (other than the Maturity Date or Redemption Date or Optional
Repayment Date, if any) may be made at the option of the Company by check mailed
to the address of the Person entitled thereto as such address shall appear in
the Security Register, or by wire transfer of immediately available funds, if
the registered holder of at least $10,000,000 in principal amount (or such other
principal amount specified on the face hereof) of Notes entitled to such
interest has so requested by a notice in writing delivered to the Trustee not
less than 16 days prior to the Interest Payment Date on which such payment is
due, which notice shall provide appropriate instructions for such transfer.

      The principal hereof and interest due at the Maturity Date will be paid
upon the Maturity Date in immediately available funds against presentation of
this Note at the office or agency of the Trustee maintained for that purpose in
the Borough of Manhattan, The City of New York.

      REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH
ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE
SAME EFFECT AS IF SET FORTH ON THE FACE HEREOF.

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

      This Note is one of the series of Medium-Term Notes, Series B, of the
Company.

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

                                      -5-
<PAGE>

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

Dated:


                                       THE BEAR STEARNS COMPANIES INC.


                                       By:
                                          --------------------------------------




ATTEST:



----------------------
Secretary

[Corporate Seal]



                          CERTIFICATE OF AUTHENTICATION

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


                                       JPMORGAN CHASE BANK, as Trustee


                                       By:
                                          --------------------------------------
                                          Authorized Signature

                                      -6-
<PAGE>

                                [Reverse of Note]

                         THE BEAR STEARNS COMPANIES INC.

                           MEDIUM-TERM NOTE, SERIES B
                                 (FLOATING RATE)

            This Note is one of a duly authorized issue of debentures, notes or
other evidences of indebtedness (hereinafter called the "Securities") of the
Company of the series hereinafter specified, all such Securities issued and to
be issued under the Indenture dated as of May 31, 1991, as amended (herein
called the "Indenture"), between the Company and JPMorgan Chase Bank (formerly,
The Chase Manhattan Bank), 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 and limitations of rights thereunder of the Company, the
Trustee and the Holders of the Securities, and the terms upon which the
Securities are, and are to be, authenticated and delivered. As provided in the
Indenture, Securities may be issued in one or more series, which different
series may be issued in various aggregate principal amounts, may mature at
different times, may bear interest, if any, at different rates, may be subject
to different redemption provisions, if any, may be subject to different
repayment provisions, if any, may be subject to different sinking, purchase or
analogous funds, if any, may be subject to different covenants and Events of
Default and may otherwise vary as in the Indenture provided or permitted. This
Note is one of a series of the Securities designated as Medium-Term Notes,
Series B (the "Notes"). The Notes of this series may be issued at various times
with different maturity dates, redemption dates and different principal
repayment provisions, may bear interest at different rates and may otherwise
vary, all as provided in the Indenture.

            The interest payable on this Note on each Interest Payment Date will
include accrued interest from and including the Original Issue Date or from and
including the last date in respect of which interest has been paid, as the case
may be, to, but excluding, such Interest Payment Date, except that the interest
payment at the Maturity Date, Redemption Date or Optional Repayment Date will
include interest accrued to but excluding such date. Accrued interest from the
Original Issue Date or from the last date to which interest has been paid is
calculated by multiplying the principal amount hereof by an accrued interest
factor. Such accrued interest factor is computed by adding the interest factors
calculated for each day from the Original Issue Date, or from the last date to
which interest has been paid, to the date for which accrued interest is being
calculated. The interest factor (expressed as a decimal calculated to seven
decimal places without rounding) for each such day is computed by dividing the
interest rate applicable to such day by 360, in the case of Commercial Paper
Rate Notes, Federal Funds Rate Notes, LIBOR Notes and Prime Rate Notes, or by
the actual number of days in the year, in the case of Treasury Rate Notes. With
respect to CMT Rate Notes, interest is calculated on the basis of twelve 30-day
months and a 360-day year. The interest rate in effect on each day will be (a)
if such day is an Interest Reset Date, the interest rate with respect to the
Interest Determination Date pertaining to such Interest Reset Date or (b) if
such day is not an Interest Reset Date, the interest rate with respect to the
Interest Determination Date pertaining to the next preceding Interest Reset
Date; provided, however, that (i) the interest rate in effect from the Original
Issue Date to the first Interest Reset Date will be the Initial Interest Rate as
specified on the face hereof and (ii) the interest rate in effect for the ten
calendar days immediately prior to maturity will be that in effect on the tenth
calendar day preceding maturity. Notwithstanding the foregoing, if the rate at
which interest is payable is

                                      -7-
<PAGE>

adjusted daily or weekly, such rate of interest shall be adjusted until the
Interest Reset Date immediately preceding the Maturity Date. Notwithstanding the
foregoing, the interest rate hereon shall not be greater than the Maximum
Interest Rate, if any, or less than the Minimum Interest Rate, if any, shown on
the face hereof. All percentages resulting from any calculations will be
rounded, if necessary, to the nearest one hundred-thousandth of a percent, with
five one-millionths of a percent being rounded upwards. In addition, the
interest rate hereon shall in no event be higher than the maximum rate, if any,
permitted by applicable law.

            Commencing with the first Interest Reset Date shown on the face
hereof following the Original Issue Date, and thereafter on each succeeding
Interest Reset Date specified on the face hereof, the rate at which interest on
this Note is payable shall be adjusted daily, weekly, monthly, quarterly,
semiannually or annually as specified on the face hereof under "Interest Reset
Date(s)." Unless otherwise specified on the face hereof, each such adjusted rate
shall be applicable on and after the Interest Reset Date to which it relates to
but not including the next succeeding Interest Reset Date or until the Maturity
Date or, if applicable, the Redemption Date or Optional Repayment Date, as the
case may be. Unless otherwise specified on the face hereof, the Interest Reset
Date will be, if this Note resets daily, each Business Day; if this Note resets
weekly, the Wednesday of each week (with the exception of weekly reset Treasury
Rate Notes which will reset the Tuesday of each week, except as specified
below); if this Note resets monthly, the third Wednesday of each month; if this
Note resets quarterly, the third Wednesday of March, June, September and
December; if this Note resets semiannually, the third Wednesday of the two
months specified on the face hereof; and if this Note resets annually, the third
Wednesday of the month specified on the face hereof. Subject to applicable law
and except as specified herein, on each Interest Reset Date, the rate of
interest on this Note shall be the rate determined in accordance with the
provisions applicable below, plus or minus the Spread (as specified on the face
hereof), if any. If any Interest Reset Date would otherwise be a day that is not
a Business Day, such Interest Reset Date shall be postponed to the next
succeeding day that is a Business Day, except that in the case of a LIBOR Note,
if such Business Day is in the next succeeding calendar month, such Interest
Reset Date shall be the next preceding Business Day. Unless otherwise specified
on the face hereof, "Business Day" means (i) with respect to any Note, any day
that is not a Saturday or Sunday, and that is neither a legal holiday nor a day
on which banking institutions or trust companies in New York City are authorized
or obligated by law to close, and (ii) with respect to LIBOR Notes only, a
London Banking Day. A "London Banking Day" means any day on which dealings in
deposits in U.S. dollars are transacted in the London interbank market.

            The Interest Determination Date pertaining to an Interest Reset Date
will be, if the Interest Rate Basis is Commercial Paper Rate or Federal Funds
(Effective) Rate, the Business Day next preceding such Interest Reset Date. The
Interest Determination Date pertaining to an Interest Reset Date will be, if the
Interest Rate Basis is LIBOR, the second London Banking Day preceding such
Interest Reset Date. The Interest Determination Date pertaining to an Interest
Reset Date will be, if the Interest Rate Basis is Treasury Rate, the day of the
week in which such Interest Reset Date falls on which Treasury bills (as defined
below) of the Index Maturity specified on the face hereof are auctioned.
Treasury bills normally are auctioned on Monday of each week, unless that day is
a legal holiday, in which case the auction is normally held on the following
Tuesday, except that such auction may be held on the preceding Friday. If, as a
result of a legal holiday, an auction is so held on the preceding Friday, such
Friday will be the Interest Determination Date pertaining to the Interest Reset
Date occurring in the next succeeding week. Interest payable hereon will be
payable monthly, quarterly, semiannually or annually (the "Interest Payment
Period") as specified

                                      -8-
<PAGE>

on the face hereof. The Interest Determination Date pertaining to an Interest
Reset Date will be, if the Interest Rate Basis is Prime Rate or Federal Funds
(Open) Rate, the same day as such Interest Reset Date. The Interest
Determination Date pertaining to an Interest Reset Date will be, if the Interest
Rate Basis is CMT Rate, the tenth Business Day prior to each Interest Reset
Date. Unless otherwise specified on the face hereof, interest will be payable,
if this Note resets daily, weekly or monthly, on the third Wednesday of each
month or on the third Wednesday of March, June, September and December, of each
year; if this Note resets quarterly, on the third Wednesday of March, June,
September and December, of each year; if this Note resets semiannually, on the
third Wednesday of the two months of each year specified on the face hereof; and
if this Note resets annually, on the third Wednesday of the month specified on
the face hereof (each such date being an "Interest Payment Date") and in each
case, at maturity or, if applicable, upon redemption or optional repayment.

            Determination of Commercial Paper Rate. If the Interest Rate Basis
specified on the face hereof is "Commercial Paper Rate," the interest rate shall
equal (a) the Money Market Yield (as defined below) on the applicable Interest
Determination Date of the rate for commercial paper having the Index Maturity
specified on the face hereof (i) as published by the Board of Governors of the
Federal Reserve System in "Statistical Release H.15(519), Selected Interest
Rates," or any successor publication ("H.l5(519)"), under the heading
"Commercial Paper--Nonfinancial" or (ii) in the event that such rate is not
published on the Calculation Date (as defined below) pertaining to such Interest
Determination Date, then as published in H.15 Daily Update or any other
recognized electronic source used for displaying that rate under the heading
"Commercial Paper--Nonfinancial" or (b) if neither of such yields is published
by 3:00 P.M., New York City time, on such Calculation Date, the Money Market
Yield of the arithmetic mean of the offered rates as of 11:00 A.M., New York
City time, of three leading dealers of commercial paper in The City of New York
selected by JPMorgan Chase Bank (formerly, The Chase Manhattan Bank), as
Calculation Agent (or any successor calculation agent, or any other Calculation
Agent named on the face hereof, the "Calculation Agent"), on that Interest
Determination Date, for commercial paper of the Index Maturity specified on the
face hereof placed for an industrial issuer whose bond rating is "AA," or the
equivalent, from a nationally recognized rating agency, in each of the above
cases, adjusted by the addition or subtraction of the Spread, if any, specified
on the face hereof; provided, however, that if such dealers are not quoting as
mentioned above, the interest rate in effect hereon until the Interest Reset
Date next succeeding the Interest Reset Date to which such Interest
Determination Date relates shall be the rate in effect on the Interest
Determination Date next preceding such Interest Reset Date.

            "Money Market Yield" shall be a yield calculated in accordance with
the following formula:

            Money Market Yield  =     D x 360   x 100
                                   -----------
                                   360 - (D x M)

where "D" refers to the per annum rate for commercial paper quoted on a bank
discount basis and expressed as a decimal; and "M" refers to the actual number
of days in the interest period for which interest is being calculated.

            Determination of LIBOR. If the Interest Rate Basis specified on the
face hereof is "LIBOR," the interest rate shall equal, as specified on the face
hereof, either (a) the offered rates for deposits in U.S. dollars having the
Index Maturity specified on the face hereof, commencing on

                                      -9-
<PAGE>

the second London Banking Day immediately following the applicable Interest
Determination Date which appears on Telerate Page 3750 (or such other page as
may replace Telerate Page 3750 for the purpose of displaying London interbank
rates of major banks), as of 11:00 A.M., London time, on such Interest
Determination Date adjusted by the addition or subtraction of the Spread, if
any, specified on the face hereof ("LIBOR Telerate") or (b) the arithmetic mean,
as determined by the Calculation Agent, of the offered rates for deposits in
U.S. dollars having the Index Maturity specified on the face hereof, commencing
on the second London Banking Day immediately following the applicable Interest
Determination Date which appears on the Reuters Screen LIBO Page (or such other
page as may replace such Reuters Screen LIBO Page for the purpose of displaying
London interbank rates of major banks), as of 11:00 A.M., London time, on such
Interest Determination Date, if at least two such offered rates appear on the
Reuters Screen LIBO Page (or such other page as may replace such page) ("LIBOR
Reuters"); provided, however, that if no such rate appears on Telerate Page 3750
(or such other page as may replace such page) or if fewer than two offered rates
appear on the Reuters Screen LIBO Page (or such other page as may replace such
page), the Calculation Agent shall request the principal London office of each
of four major banks in the London interbank market selected by the Calculation
Agent to provide a quotation of the rate at which such bank offered to prime
banks in the London interbank market at approximately 11:00 A.M., London time,
on such Interest Determination Date, deposits in U.S. dollars having the Index
Maturity specified on the face hereof commencing on the second London Banking
Day immediately following such Interest Determination Date and in a principal
amount equal to an amount not less than U.S. $1,000,000 that is representative
of a single transaction in such market at such time, and such rate of interest
hereon shall equal the arithmetic mean of (a) such quotations, if at least two
quotations are provided, or (b) if less than two quotations are provided, the
rates quoted at approximately 11:00 A.M., New York City time, on such Interest
Determination Date by three major banks in The City of New York, selected by the
Calculation Agent for loans in U.S. dollars to leading European banks, having
the Index Maturity specified on the face hereof commencing on the second London
Banking Day immediately following such Interest Determination Date and in a
principal amount as aforesaid, in either case, adjusted by the addition or
subtraction of the Spread, if any, specified on the face hereof; provided,
however, that if the three banks selected as aforesaid by the Calculation Agent
are not quoting as mentioned above, the interest rate in effect hereon until the
Interest Reset Date next succeeding the Interest Reset Date to which such
Interest Determination Date relates shall be the rate in effect on the Interest
Determination Date next preceding such Interest Reset Date.

            Determination of Federal Funds Rate. If the Interest Rate Basis
specified on the face hereof is "Federal Funds Rate," the interest rate shall
equal either the Federal Funds (Effective) Rate or the Federal Funds (Open)
Rate.

            Unless otherwise specified on the face hereof, the Federal Funds
(Effective) Rate shall equal (a) the rate on the applicable Interest
Determination Date specified on the face hereof for Federal Funds as published
in H.15(519) under the heading "Federal funds (effective)" on Telerate page 120
or any successor service or page, or (b) if such rate is not so published on the
Calculation Date pertaining to such Interest Determination Date, then the rate
on the applicable Interest Determination Date as published in H.15 Daily Update
or any other recognized electronic source used for displaying that rate under
the heading "Federal Funds/Effective Rate."

            Unless otherwise specified on the face hereof, the Federal Funds
(Open) Rate shall equal the rate on the applicable Interest Determination Date
specified on the face hereof for Federal Funds as reported on Telerate Page 5
under the heading "Federal Funds/Open."

                                      -10-
<PAGE>

            If (a) the applicable Federal Funds (Effective) Rate described above
or (b) the Federal Funds (Open) Rate described above is not published by 3:00
P.M., New York City time, on the relevant Calculation Date, then the Federal
Funds (Effective) Rate and the Federal Funds (Open) Rate, as applicable, will be
calculated by the Calculation Agent as the arithmetic mean of the rates for the
last transaction in overnight Federal Funds arranged by three leading brokers of
Federal Funds transactions in The City of New York selected by the Calculation
Agent as of 11:00 A.M., New York City time, on such Interest Determination Date,
in each of the above cases, adjusted by the addition or subtraction of the
Spread, if any, specified on the face hereof; provided, however, that if such
brokers are not quoting as mentioned above, the interest rate in effect hereon
until the Interest Reset Date next succeeding the Interest Reset Date to which
such Interest Determination Date relates shall be the rate in effect on the
Interest Determination Date next preceding such Interest Reset Date.

            Determination of Treasury Rate. If the Interest Rate Basis specified
on the face hereof is "Treasury Rate," the interest rate shall equal the rate
for the auction held on the applicable Interest Determination Date of direct
obligations of the United States ("Treasury bills") having the Index Maturity
specified on the face hereof as published under the column designated "Invest
Rate" on Telerate page 56 under the heading "US Treasury 3 MO T-Bill Auction
Results" or Telerate page 57 under the heading "US Treasury 6 MO T-Bill Auction
Results," as applicable, or any successor publication, or, if not so published
on the Calculation Date pertaining to such Interest Determination Date, the
auction average rate (expressed as a bond equivalent on the basis of a year of
365 or 366 days, as applicable, and applied on a daily basis) as otherwise
announced by the United States Department of the Treasury, in either case,
adjusted by the addition or subtraction of the Spread, if any, specified on the
face hereof. In the event that the results are not published or reported as
provided above by 3:00 P.M., New York City time, on such Calculation Date, or if
no such auction is held in a particular week, then the rate of interest herein
shall be calculated by the Calculation Agent and shall be a yield to maturity
(expressed as a bond equivalent on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) of the arithmetic mean of the
secondary market bid rates as of approximately 3:30 P.M., New York City time, on
such Interest Determination Date, of three leading primary United States
government securities dealers selected by the Calculation Agent for the issue of
Treasury bills with a remaining maturity closest to the Index Maturity specified
on the face hereof, adjusted by the addition or subtraction of the Spread, if
any, specified on the face hereof; provided, however, that if the dealers
selected as aforesaid by the Calculation Agent are not quoting as mentioned
above, the interest rate in effect hereon until the Interest Reset Date next
succeeding the Interest Reset Date to which such Interest Determination Date
relates shall be the rate in effect on the Interest Determination Date next
preceding such Interest Reset Date.

            Determination of Prime Rate. If the Interest Rate Basis specified on
the face hereof is "Prime Rate," the interest rate shall equal (a) the rate on
the applicable Interest Determination Date (i) as reported on Telerate Page 5
under the heading "Bank Rates/Prime" or (ii) as published in H.15(519), under
the caption "Bank Prime Loan", (b) if the rates referred to under (a)(i) and
(a)(ii) are not published by 9:00 A.M., New York City time, on the Calculation
Date pertaining to such Interest Determination Date, then the arithmetic mean
(as calculated by the Calculation Agent) of the rates of interest publicly
announced by each bank named on the Reuters Screen NYMF Page (as defined below)
as such bank's prime rate or base lending rate as in effect for such Interest
Determination Date as quoted on the Reuters Screen NYMF Page for such Interest
Determination Date, or, if fewer than four such rates appear on the Reuters
Screen NYMF Page for such Interest

                                      -11-
<PAGE>

Determination Date, the rate shall be the arithmetic mean (as calculated by the
Calculation Agent) of the prime rates quoted on the basis of the actual number
of days in the year divided by 360 as of the close of business on such Interest
Determination Date by at least two of the three major money center banks in The
City of New York selected by the Calculation Agent (after consultation with the
Company) from which quotations are requested, or (c) if fewer than two
quotations are provided under (b) above, the Prime Rate shall be calculated by
the Calculation Agent and shall be determined as the arithmetic mean on the
basis of the prime rates in The City of New York by the appropriate number of
substitute banks or trust companies organized and doing business under the laws
of the United States, or any State thereof, in each case having total equity
capital of at least U.S. $500 million and being subject to supervision or
examination by Federal or State authority, selected by the Calculation Agent
(after consultation with the Company) to quote such rate or rates, in each case
adjusted by the addition or subtraction of the Spread, if any, specified on the
face hereof; provided, however, that if in any month or two consecutive months,
the Prime Rate is not reported or published as provided above, and if such
quotations are not available, the interest rate in effect hereon until the
Interest Reset Date next succeeding the Interest Reset Date to which such
Interest Determination Date relates shall be the rate in effect on the Interest
Determination Date next preceding such Interest Reset Date in each case.

            If this failure continues over three or more consecutive months, the
Prime Rate for each succeeding Interest Determination Date until the maturity or
redemption of this Note or, if earlier, until this failure ceases, shall be
LIBOR determined as if this Note were a LIBOR Note, and the Spread, if any, will
be the number of basis points specified on the face hereof as the "Alternate
Rate Event Spread."

            "Reuters Screen NYMF Page" means the display designated as Page
"NYMF" on the Reuters Monitor Money Rates Service (or such other page as may
replace the NYMF Page on that service for the purpose of displaying prime rates
or base lending rates of major United States banks).

            Determination of CMT Rate. If the Interest Rate Basis specified on
the face hereof is "CMT Rate," the interest rate will be determined by the
Calculation Agent on each Interest Determination Date in accordance with the
following provisions, in each case, adjusted by the addition or subtraction of
the Spread, if any, specified on the face hereof.

            Unless otherwise specified on the face hereof, the CMT Rate will be:

            (a) the rate displayed on the designated CMT Telerate Page, under
the caption for "... Treasury Constant Maturities... Federal Reserve Board
Release H.15... Mondays Approximately 3:45 p.m.," under the column for the
designated CMT Index Maturity, for: (i) the latest rate displayed at the close
of business on such Interest Determination Date if the designated CMT Telerate
Page is 7051; or (ii) the average for the week, or the month, as specified on
the face hereof, ended immediately before the week in which the related Interest
Determination Date occurs if the designated CMT Telerate Page is 7052.

            (b) If the applicable rate specified in (a) above is not displayed
on the relevant page by 3:00 p.m., New York City time on that Calculation Date,
unless the calculation is made earlier and the rate is available from that
source at that time on the Calculation Date, then the CMT Rate will be the
Treasury constant maturity rate having the designated Index Maturity, as
published in H.15(519) or another recognized electronic source for displaying
the rate.

                                      -12-
<PAGE>

            (c) If the applicable rate specified in (b) above is not published
in H.15(519) or another recognized electronic source for displaying such rate by
3:00 p.m., New York City time on that Calculation Date, unless the calculation
is made earlier and the rate is available from one of those sources at that
time, then the CMT Rate will be the Treasury constant maturity rate, or other
United States Treasury rate, for the Index Maturity and with reference to the
relevant Interest Determination Date, that is published by either the Board of
Governors of the Federal Reserve System or the United States Department of the
Treasury and that the Calculation Agent determines to be comparable to the rate
formerly displayed on the designated CMT Telerate Page and published in
H.15(519).

            (d) If the applicable rate specified in (c) above cannot be
determined, then the Calculation Agent will determine the CMT Rate to be a yield
to maturity based on the average of the secondary market offered rates as of
approximately 3:30 p.m., New York City time, on the relevant Interest
Determination Date reported, according to their written records, by three
leading primary United States government securities dealers in New York City.
The Calculation Agent will select five such securities dealers after consulting
with the Company, and will eliminate the highest quotation (or, in the event of
equality, one of the highest) and the lowest quotation (or, in the event of
equality, one of the lowest), for the most recently issued direct noncallable
fixed rate obligations of the United States Treasury ("Treasury Notes") with an
original maturity of approximately the designated Index Maturity and a remaining
term to maturity of not less than the designated Index Maturity minus one year
in a representative amount. If two Treasury Notes with an original maturity as
described above have remaining terms to maturity equally close to the designated
Index Maturity, the quotes for the Treasury Note with the shorter remaining term
to maturity will be used.

            (e) If the Calculation Agent cannot obtain three Treasury Note
quotations of the kind described in the prior paragraph, the Calculation Agent
will determine the CMT Rate to be the yield to maturity based on the average of
the secondary market offered rates for Treasury Notes with an original maturity
longer than the designated CMT Index Maturity which have a remaining term to
maturity closest to the designated CMT Index Maturity and in a representative
amount, as of approximately 3:30 p.m., New York City time, on the relevant
Interest Determination Date of leading primary United States government
securities dealers in New York City. In selecting these offered rates, the
Calculation Agent will request quotations from at least five such securities
dealers and will disregard the highest quotation (or if there is equality, one
of the highest) and the lowest quotation (or if there is equality, one of the
lowest). If two Treasury Notes with an original maturity longer than the
designated CMT Index Maturity have remaining terms to maturity that are equally
close to the designated CMT Index Maturity, the Calculation Agent will obtain
quotations for the Treasury Note with the shorter remaining term to maturity.

            (f) If fewer than five but more than two if the leading primary
United States government securities dealers are quoting as described in the
prior paragraph, then the CMT Rate for the relevant Interest Determination Date
will be based on the average of the offered rates obtained, and neither the
highest nor the lowest of those quotations will be eliminated.

            (g) If two or fewer leading primary United States government
securities dealers selected by the Calculation Agent are quoting as described
above, the CMT Rate will remain the CMT Rate then in effect on that Interest
Determination Date.

            The Calculation Date pertaining to an Interest Determination Date
shall be the earlier of (a) the tenth calendar day after such Interest
Determination Date or if any such day is not

                                      -13-
<PAGE>

a Business Day, the next succeeding Business Day, or (b) the Business Day prior
to the applicable Interest Payment Date, Maturity Date, Redemption Date or
Optional Repayment Date. The Calculation Agent shall calculate the interest rate
hereon in accordance with the foregoing and will confirm in writing such
calculation to the Trustee and any Paying Agent immediately after each
determination. Neither the Trustee nor any Paying Agent shall be responsible for
any such calculation. All determinations made by the Calculation Agent shall be,
in the absence of manifest error, conclusive for all purposes and binding on the
Company and holders of the Note. At the request of the Holder hereof, the
Calculation Agent will provide to the Holder hereof the interest rate hereon
then in effect and, if different, the interest rate that will become effective
as a result of a determination made on the most recent Interest Reset Date with
respect to the Note.

            If so specified on the face of this Note, this Note may be redeemed
by the Company on and after the date so indicated on the face hereof. If no such
date is set forth on the face hereof, this Note may not be redeemed prior to
maturity. On and after such date, if any, from which this Note may be redeemed,
unless otherwise specified on the face hereof, this Note may be redeemed in
whole or in part in increments of $1,000 (provided, unless a different minimum
denomination is set forth on the face hereof, that any remaining principal
amount of this Note shall be at least $25,000) at the option of the Company, at
a redemption price equal to 100% of the principal amount to be redeemed,
together with interest thereon payable to the Redemption Date, on notice given,
unless otherwise specified on the face hereof, not more than 60 nor less than 30
days prior to the Redemption Date. If less than all the Outstanding Notes having
such terms as specified by the Company are to be redeemed, the particular Notes
to be redeemed shall be selected by the Trustee not more than 60 days prior to
the Redemption Date from the Outstanding Notes having such terms as specified by
the Company not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate. The notice of such redemption shall specify
which Notes are to be redeemed. In the event of redemption of this Note, in part
only, a new Note or Notes in authorized denominations for the unredeemed portion
hereof shall be issued in the name of the Holder hereof upon the surrender
hereof.

            If so specified on the face of this Note, this Note will be subject
to repayment at the option of the Holder hereof on the Optional Repayment
Date(s). Except as set forth in the next paragraph, if no Optional Repayment
Date is set forth on the face hereof, this Note may not be repaid at the option
of the Holder prior to maturity. Unless otherwise specified on the face hereof,
on and after the Optional Repayment Date, if any, from which this Note may be
repaid at the option of the Holder, this Note shall be repayable in whole or in
part in increments of $1,000 (provided, unless a different minimum denomination
is set forth on the face hereof, that any remaining principal amount of this
Note shall be at least $25,000) at a repayment price equal to 100% of the
principal amount to be repaid, together with interest thereon payable to the
Optional Repayment Date. For this Note to be repaid in whole or in part at the
option of the Holder hereof, the Trustee must receive not less than 30 nor more
than 60 days prior to the Optional Repayment Date (i) this Note with the form
entitled "Option to Elect Repayment," which appears below, duly completed or
(ii) a telegram, telex, facsimile transmission or a letter from a member of a
national securities exchange or the National Association of Securities Dealers,
Inc. or a commercial bank or trust company in the United States of America
setting forth the name of the Holder of this Note, the principal amount of this
Note, the certificate number of this Note or a description of this Note's tenor
or terms, the principal amount of this Note to be repaid, a statement that the
option to elect repayment is being exercised thereby and a guarantee that this
Note with the form entitled "Option to Elect Repayment," which appears below,
duly completed, will be received by the Trustee no

                                      -14-
<PAGE>

later than five Business Days after the date of such telegram, telex, facsimile
transmission or letter and this Note and such form duly completed are received
by the Trustee by such fifth Business Day. Exercise of the repayment option
shall be irrevocable.

            If an Event of Default with respect to the Notes shall occur and be
continuing, the Trustee or the Holders of not less than 25% in principal amount
of the Outstanding Notes may declare the principal of all the Notes due and
payable in the manner and with the effect provided in the Indenture.

            The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of 66-2/3% in aggregate principal amount of the
Securities at the time Outstanding of each series affected thereby. The
Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of each 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 Note shall be conclusive and binding
upon such Holder and upon future Holders of this Note and of any Note issued
upon the registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note.

            Holders of Securities may not enforce their rights pursuant to the
Indenture or the Securities except as provided in the Indenture. No reference
herein to the Indenture and no provision of this Note or the Indenture shall
alter or impair the obligation of the Company, which is absolute and
unconditional, to pay the principal of and interest on this Note at the time,
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 Note may be registered on the Security
Register of the Company, upon surrender of this Note for registration of
transfer at the office or agency of the Company in the Borough of Manhattan, The
City of New York, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company, and this Note duly executed by,
the Holder hereof or by his attorney duly authorized in writing and thereupon
one or more new Notes, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.

            Unless otherwise specified on the face hereof, the Notes are
issuable only in registered form without coupons in denominations of $25,000 or
any amount in excess thereof which is an integral multiple of $1,000. As
provided in the Indenture and subject to certain limitations therein set forth,
this Note is exchangeable for a like aggregate principal amount of Notes of
different authorized denomination as requested by the Holder surrendering the
same.

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

            Prior to the due presentment of this Note 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

                                      -15-
<PAGE>

Note is registered as the owner hereof for all purposes, whether or not this
Note be overdue, and neither the Company, the Trustee nor any such agent shall
be affected by notice to the contrary.

            The interest rate payable with respect to this Note shall in no
event be higher than the maximum rate, if any, permitted by applicable law.

            All capitalized terms used in this Note and not otherwise defined
herein shall have the meanings assigned to them in the Indenture.












                                      -16-
<PAGE>

                                  ABBREVIATIONS


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

TEN COM     -     as tenants in common

TEN ENT     -     as tenants by the entireties

JT TEN      -     as  joint  tenants  with  right  of  survivorship  and  not as
                  tenants in common

UNIF GIFT MIN ACT - ________________________ Custodian _________________________
                              (Cust)                           (Minor)
                                 Under Uniform Gifts to Minors Act

                             ___________________________________________
                                              (State)


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









                                      -17-
<PAGE>

                            OPTION TO EXTEND MATURITY


            The undersigned hereby elects to extend the maturity of The Bear
Stearns Companies Inc. Medium-Term Note, Series B (Floating Rate) (CUSIP No.
         ) or the portion thereof specified below.

            For the election to extend maturity to be made, the Trustee must
receive at its Corporate Trust Office, or at such other place or places of which
the Company shall from time to time notify the Holder, this Note with this
"Option to Extend Maturity" form duly completed. This Note must be received by
the Trustee by the close of business in New York City, on the last day for
giving such notice, as described in this Note.

            If less than the entire principal amount of this Note is to be
extended, specify the portion hereof (which shall be in an amount equal to
$25,000 or an integral multiple of $1,000, provided that any remaining principal
amount shall be an authorized denomination) which the Holder elects to have
extended and specify the denomination or denominations (which shall be in an
amount equal to an authorized denomination) of the Notes to be issued to the
Holder for the portion of this Note not being extended (in the absence of any
such specification, one such Note shall be issued for the portion not being
extended).


$_________________________________       _______________________________________
                                         NOTICE: The signature on this Option to
                                         Extend Maturity must correspond with
Date _____________________________      the name as written upon the face of
                                         this Note in every particular, without
                                         alteration or enlargement or any change
                                         whatever.













                                      -18-
<PAGE>

                            OPTION TO ELECT REPAYMENT

            The undersigned hereby irrevocably request(s) and instruct(s) the
Company to repay this Note (or portion thereof specified below) pursuant to its
terms on _____________, 20__ (the "Optional Repayment Date") at a price equal to
the principal amount thereof, together with interest to the Optional Repayment
Date, to the undersigned at

________________________________________________________________________________

________________________________________________________________________________
        (Please print or typewrite name and address of the undersigned.)

            For this Note to be repaid the Trustee must receive at 4 New York
Plaza, New York, New York 10004, Attention: Debt Operations -- 13th Floor, or at
such other place or places of which the Company shall from time to time notify
the Holder of this Note, not more than 60 days nor less than 30 days prior to
the Optional Repayment Date, this Note with this "Option to Elect Repayment"
form duly completed.

            If less than the entire principal amount of this Note is to be
repaid, specify the portion thereof (which shall be increments of $1,000) which
the Holder elects to have repaid: $______________; and specify the denomination
or denominations (which, unless a different minimum denomination is set forth on
the face hereof, shall be $25,000 or an integral multiple of $1,000 in excess of
$25,000) of the Notes to be issued to the Holder for the portion of this Note
not being repaid (in the absence of any such specification, one such Note will
be issued for the portion not being repaid): $________________.

Date:______________________        _____________________________________________
                                   Note:  The signature to this Option to Elect
                                   Repayment must correspond with the same as
                                   written upon the face of this Note in every
                                   particular without alteration or enlargement.


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

                                   ASSIGNMENT
                                   ----------

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


________________________________________________________________________________
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE

________________________________________________________________________________

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

                                      -19-
<PAGE>


________________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing

______________________________________________________________________ Attorney
to transfer said Note on the books of the Company, with full power of
substitution in the premises.

Dated:  __________________________

                                                ________________________________



__________________________________________
          (Signature Guarantee)







                                      -20-
<PAGE>
                                                                      SCHEDULE I

                              SCHEDULE OF EXCHANGES

The initial principal amount of this Note is $___________. The following
exchanges of a portion of this Note for an interest in a fixed maturity note,
have been made:

                                          Reduced Principal
                     Principal Amount     Amount Outstanding    Notation Made by
                       Exchanged for        Following Such       or on Behalf of
 Date of Exchange  Fixed Maturity Note        Exchange            the Trustee
--------------------------------------------------------------------------------

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                                      -21-