<PAGE>   1
                                                                       Exhibit 4


                         AETNA LIFE AND CASUALTY COMPANY

                                       AND

                       THE FIRST NATIONAL BANK OF BOSTON,

                                     Trustee


                                    ---------


                                    INDENTURE

                          Dated as of October 15, 1986


                                    ---------


                                 Debt Securities
<PAGE>   2

                             CROSS REFERENCE SHEET*

      Between the provisions of the Trust Indenture Act of 1939 and an Indenture
dated as of October 15, 1986 between Aetna Life and Casualty Company (the
"Company") and The First National Bank of Boston, as Trustee.

Section of the Act                                        Section of Indenture
------------------                                        --------------------
310(a)(1) and (2)..................................8.09
310(a)(3) and (4)..................................Inapplicable
310(b).............................................8.08 and 8.10(a), (b) and (d)
310(c).............................................Inapplicable
311(a).............................................8.13(a) and (c)(1) and (2)
311(b).............................................8.13(b)
311(c).............................................Inapplicable
312(a).............................................6.01 and 6.02(a)
312(b).............................................6.02(b)
312(c).............................................6.02(c)
313(a).............................................6.04(a)
313(b)(1)..........................................Inapplicable
313(b)(2)..........................................6.04(b)
313(c).............................................6.04(c)
313(d).............................................6.04(d)
314(a).............................................6.03
314(b).............................................Inapplicable
314(c)(1) and (2)..................................14.04
314(c)(3)..........................................Inapplicable
314(d).............................................Inapplicable
314(e).............................................14.04
314(f).............................................Inapplicable
315(a),(c) and (d).................................8.01
315(b).............................................7.10
315(e).............................................7.11
316(a)(1)..........................................7.09
316(a)(2)..........................................Not required
316(a)(last sentence)..............................9.04
316(b).............................................7.07
317(a).............................................7.02
317(b).............................................5.04(a)
318(a).............................................14.06


--------

* This Cross Reference Sheet shall not for any purpose be deemed part of the
Indenture, as executed.
<PAGE>   3

                               TABLE OF CONTENTS*

                                                                            Page
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PARTIES......................................................................1
RECITALS.....................................................................1

                                   ARTICLE ONE

                                   DEFINITIONS

SECTION 1.01.   Certain Terms Defined........................................1
                Board of Directors...........................................2
                Business day.................................................2
                Commission...................................................2
                Common Stock.................................................2
                Company......................................................2
                Control......................................................2
                Corporate Trust Office.......................................3
                Defaulted Interest...........................................3
                Event of Default.............................................3
                Fair Value...................................................3
                Indenture....................................................3
                Interest Payment Date........................................3
                Non-Recourse Indebtedness....................................3
                Officers' Certificate........................................4
                Opinion of Counsel...........................................4
                Original Issue Discount Security.............................4
<PAGE>   4
                                       ii

                Person.......................................................4
                Predecessor Security.........................................4
                Principal Insurance Subsidiary...............................4
                Register.....................................................5
                Regular Record Date..........................................4
                Responsible officer..........................................4
                Security; Outstanding........................................5
                Security holder..............................................6
                Sinking fund redemption price................................6
                Special Record Date..........................................7
                Subsidiary...................................................7
                Trustee......................................................7
                Trust Indenture Act of 1939..................................7
                U.S. Government Obligations..................................7
                Voting stock.................................................8
                Yield to Maturity............................................8

                                   ARTICLE TWO

              ISSUE, EXECUTION, FORM AND REGISTRATION OF SECURITIES

SECTION 2.01.   Generally....................................................8
SECTION 2.02.   Form of Securities; Issuable in Series; Terms................8
SECTION 2.03.   Denominations...............................................10
SECTION 2.04.   Execution...................................................10
SECTION 2.05.   Authentication and Dating...................................11
SECTION 2.06.   Registration, Transfer and Exchange.........................13
SECTION 2.07.   Mutilated, Destroyed, Lost and Stolen Securities............14
SECTION 2.08.   Cancellation of Securities; Destruction Thereof.............15
SECTION 2.09.   Temporary Securities........................................15
SECTION 2.10.   Defaulted Interest..........................................16

                                  ARTICLE THREE

         REDEMPTION OF SECURITIES-OPTIONAL AND SINKING FUND REDEMPTIONS

SECTION 3.01.   Applicability of Article....................................17


----------
* This Table of Contents shall not for any purpose be deemed part of the
Indenture, as executed.
<PAGE>   5

                                      iii


                                                                            Page
                                                                            ----
SECTION 3.02.   Notice of Redemption; Partial Redemptions...................17
SECTION 3.03.   Payment of Securities Called for Redemption.................18
SECTION 3.04.   Sinking Fund Redemptions....................................19
SECTION 3.05.   Exclusion of Company Owned Securities.......................21

                                  ARTICLE FOUR

                            CONVERSION OF SECURITIES

SECTION 4.01.   Applicability of Article....................................22
SECTION 4.02.   Exercise of Conversion Privilege............................22
SECTION 4.03.   No Fractional Shares........................................24
SECTION 4.04.   Adjustment to Conversion Price..............................24
SECTION 4.05.   Reservation of Shares of Common Stock.......................25
SECTION 4.06.   Payment of Certain Taxes Upon Conversion....................25
SECTION 4.07.   Nonassessability............................................25
SECTION 4.08.   Effect of Consolidation or Merger on Conversion Privilege...26
SECTION 4.09.   Duties of Trustee Regarding Conversion......................27
SECTION 4.10.   Repayment of Certain Funds Upon Conversion..................28

                                  ARTICLE FIVE

                       PARTICULAR COVENANTS OF THE COMPANY

SECTION 5.01.   Payment of Principal of and Interest on Securities..........28
SECTION 5.02.   Maintenance of Offices or Agencies for Registration, 
                Transfer, Exchange, Conversion and Payment of Securities....28
SECTION 5.03.   Appointment To Fill a Vacancy in Office of Trustee..........29
SECTION 5.04.   Paying Agents...............................................29
SECTION 5.05.   Limitations on Liens on Common Stock of Principal 
                Insurance Subsidiaries......................................30
SECTION 5.06.   Certificates to Trustee.....................................30
<PAGE>   6

                                       iv

                                                                            Page
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                                   ARTICLE SIX

        LISTS OF SECURITY HOLDERS; REPORTS BY THE COMPANY AND THE TRUSTEE

SECTION 6.01.   Company To Furnish Trustee Information as to Names 
                and Addresses of Security Holders...........................31
SECTION 6.02.   Preservation of Information; Communications to Security 
                Holders.....................................................31
SECTION 6.03.   Reports by the Company......................................33
SECTION 6.04.   Reports by the Trustee......................................34

                                  ARTICLE SEVEN

                          REMEDIES ON EVENT OF DEFAULT

SECTION 7.01.   Event of Default Defined; Acceleration of Maturity; 
                Waiver of Default...........................................35
SECTION 7.02.   Collection of Indebtedness by Trustee; Trustee May Prove 
                Debt........................................................40
SECTION 7.03.   Application of Proceeds.....................................43
SECTION 7.04.   Suits for Enforcement.......................................44
SECTION 7.05.   Restoration of Rights on Abandonment of Proceedings.........44
SECTION 7.06.   Limitations on Proceedings by Security Holders..............44
SECTION 7.07.   Unconditional Right of Security Holders To Sue for 
                Principal and Interest......................................45
SECTION 7.08.   Powers and Remedies Cumulative; Delay or Omission Not 
                Waiver of Default...........................................45
SECTION 7.09.   Control by Security Holders; Waiver of Default..............46
SECTION 7.10.   Trustee To Give Notice of Default; May Withhold Under 
                Certain Circumstances.......................................47
SECTION 7.11.   Right of Court To Require Filing of Undertaking To Pay 
                Costs.......................................................48

                                  ARTICLE EIGHT

                             CONCERNING THE TRUSTEE

SECTION 8.01.   Duties and Responsibility of the Trustee: Prior to 
                Default; During Default.....................................48
<PAGE>   7

                                       v


                                                                            Page
                                                                            ----

SECTION 8.02.   Certain Rights of the Trustee...............................50
SECTION 8.03.   Recitals; Trustee Not Responsible for Disposition of 
                Securities or Application of Proceeds Thereof...............51
SECTION 8.04.   Trustee May Hold Securities.................................51
SECTION 8.05.   Moneys Held by Trustee......................................51
SECTION 8.06.   Compensation of Trustee and Its Prior Claim.................52
SECTION 8.07.   Right of Trustee To Rely on Officers' Certificate...........52
SECTION 8.08.   Qualification of Trustee; Resignation of Trustee With
                Conflicting Interests.......................................53
SECTION 8.09.   Persons Eligible for Appointment as Trustee.................59
SECTION 8.10.   Resignation and Removal; Appointment of Successor Trustee...59
SECTION 8.11.   Acceptance of Appointment by Successor Trustee..............61
SECTION 8.12.   Merger, Conversion or Consolidation of Trustee..............62
SECTION 8.13.   Preferential Collection of Claims Against the Company.......63
SECTION 8.14.   Limitation on Role of Trustee in Participating in 
                Solicitation of Consents, Authorizations, Etc. .............67

                                  ARTICLE NINE

                         CONCERNING THE SECURITY HOLDERS

SECTION 9.01.   Evidence of Action Taken by Security Holders................68
SECTION 9.02.   Proof of Execution of Instruments and of Holding of 
                Securities..................................................69
SECTION 9.03.   Holders of Securities May Be Treated as Owners..............69
SECTION 9.04.   Securities Owned by Company Deemed Not Outstanding..........70
SECTION 9.05.   Right of Revocation of Action Taken.........................70
<PAGE>   8

                                       vi


                                                                            Page
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                                   ARTICLE TEN

                           SECURITY HOLDERS' MEETINGS

SECTION 10.01.  Purposes for Which Security Holders' Meetings May Be 
                Called......................................................71
SECTION 10.02.  Trustee May Call Meeting....................................71
SECTION 10.03.  Company and Security Holders May Call Meeting...............71
SECTION 10.04.  Persons Entitled To Vote at Meeting.........................72
SECTION 10.05.  Determination of Voting Rights; Conduct and Adjournment 
                of Meeting..................................................72
SECTION 10.06.  Counting Vote and Recording Action of Meeting...............73
SECTION 10.07.  Call of Meeting Not To Affect Rights of Trustee and 
                Security Holders............................................74

                                 ARTICLE ELEVEN

                             SUPPLEMENTAL INDENTURES

SECTION 11.01.  Supplemental Indentures Without Consent of Security 
                Holders.....................................................74
SECTION 11.02.  Supplemental Indentures With Consent of Security Holders....76
SECTION 11.03.  Effect of Supplemental Indentures...........................77
SECTION 11.04.  Documents To Be Given to Trustee............................78
SECTION 11.05.  Notation on Securities in Respect of Supplemental 
                Indentures..................................................78
SECTION 11.06.  Waiver of Compliance by Security Holders....................78

                                 ARTICLE TWELVE

                          CONSOLIDATION, MERGER OR SALE

SECTION 12.01.  Company May Consolidate, Merge or Sell on Certain Terms.....78
SECTION 12.02.  Officers' Certificate and Opinion Of Counsel To Be Given 
                to Trustee..................................................80

<PAGE>   9

                                      vii


                                                                            Page
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                                ARTICLE THIRTEEN

            SATISFACTION AND DISCHARGE OF INDENTURE; UNCLAIMED MONEYS

SECTION 13.01.  Satisfaction and Discharge of Indenture.....................80
SECTION 13.02.  Application by Trustee of Funds Deposited for Payment of
                Securities..................................................81
SECTION 13.03.  Repayment of Moneys Held by Paying Agent....................81
SECTION 13.04.  Return of Moneys Held by Trustee and Unclaimed for 
                Three Years.................................................82
SECTION 13.05.  Defeasance Upon Deposit of Moneys or U.S. Government 
                Obligations.................................................82

                                ARTICLE FOURTEEN

                            MISCELLANEOUS PROVISIONS

SECTION 14.01.  Benefits of Indenture Restricted to Parties and Security 
                Holders.....................................................83
SECTION 14.02.  Successors and Assigns......................................84
SECTION 14.03.  Notices and Demands.........................................84
SECTION 14.04.  Officers' Certificates and Opinions of Counsel; 
                Statements To Be Contained Therein..........................84
SECTION 14.05.  Payments Due on Saturdays, Sundays and Holidays.............86
SECTION 14.06.  Conflict of Any Provision of Indenture With Trust 
                Indenture Act of 1939.......................................86
SECTION 14.07.  Personal Immunity from Liability of Incorporators, 
                Stockholders, Etc...........................................86
SECTION 14.08.  Laws of State of New York To Govern.........................86
SECTION 14.09.  Counterparts................................................87
SECTION 14.10.  Acceptance of Trust by Trustee..............................87
SECTION 14.11.  Effect of Headings..........................................87
TESTIMONIUM.................................................................87
SIGNATURES..................................................................87
ACKNOWLEDGMENTS.............................................................87

<PAGE>   10
                                       1

      Indenture, dated as of October 15, 1986, between AETNA LIFE AND CASUALTY
COMPANY, a Connecticut insurance corporation (the "Company"), and THE FIRST
NATIONAL BANK OF BOSTON, as trustee (the "Trustee").

      WHEREAS, 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 to be issued in one or more
series ("Securities"), and, in order to provide, among other things, for the
authentication and delivery thereof by the Trustee, the Company has duly
authorized the execution and delivery of this Indenture;

      AND WHEREAS, the Company represents that all acts and things necessary to
constitute these presents a valid agreement according to its terms have been
done and performed, and the execution of this Indenture has in all respects been
duly authorized, and the Company, in the exercise of legal right and power in it
vested, executes this Indenture;

      NOW, THEREFORE:

      For and in consideration of the premises, of the purchase and acceptance
of the Securities by the holders thereof and of the sum of One Dollar to it duly
paid by the Trustee at the execution of these presents, the receipt whereof is
hereby acknowledged, the Company covenants and agrees with the Trustee, for the
equal and proportionate benefit of all holders of the Securities as follows:

                                   ARTICLE ONE

                                   DEFINITIONS

      SECTION 1.01. Certain Terms Defined. The following terms (except as
otherwise expressly provided or unless the context otherwise requires) for all
purposes of this Indenture and of any indenture supplemental hereto shall have
the respective meanings specified in this Section 1.01. All other terms used in
this Indenture which are defined in the Trust Indenture Act of 1939 or the
definitions of which in the Securities Act of 1933 are referred to in the Trust
Indenture Act of 1939 (except as herein otherwise expressly provided or unless
the context otherwise requires), shall have the meanings assigned to such terms
in such Trust Indenture Act and in such Securities Act as in force at the date
as of which this Indenture was originally executed by the Company. All
accounting terms used herein not expressly defined shall have the meanings given
to them in
<PAGE>   11
                                       2

accordance with generally accepted accounting principles, and the term
"generally accepted accounting principles" shall mean such accounting principles
as are generally accepted at the time of any computation. The singular shall
imply the plural and vice-versa.

      Board of Directors:

      The term "Board of Directors" shall mean the Board of Directors of the
Company, the Executive Committee of such Board or any other duly authorized
committee of directors and/or officers appointed by such Board or Executive
Committee.

      Business day:

      The term "business day" shall mean each Monday, Tuesday, Wednesday,
Thursday and Friday except any of such days on which banks are authorized to be
closed pursuant to the laws of the State of New York or of the Commonwealth of
Massachusetts.

      Commission:

      The term "Commission" shall mean the Securities and Exchange Commission or
any successor agency thereto.

      Common Stock:

      The term "Common Stock" shall mean, with respect to the Company, its
common capital stock, without par value, and with respect to any Principal
Insurance Subsidiary, stock of any class, however designated, except stock which
is non-participating beyond fixed dividend and liquidation preferences and the
holders of which have either no voting rights or limited voting rights entitling
them, only in the case of certain contingencies, to elect less than a majority
of the directors (or persons performing similar functions) of such Principal
Insurance Subsidiary, and shall include securities of any class, however
designated, which are convertible into such Common Stock.

      Company:

      The term "Company" shall mean AETNA LIFE AND CASUALTY COMPANY, a
Connecticut insurance corporation, and, subject to the provisions of Article
Twelve, shall also include its successors and assigns.

      Control:

      The term "control" shall mean the power to direct the management and
policies of a person, directly or indirectly or through one or more
<PAGE>   12
                                       3

intermediaries, whether through the ownership of voting securities, by contract
or otherwise; and the terms "controlling" and "controlled" shall have meanings
correlative to the foregoing.

      Corporate Trust Office:

      The term "Corporate Trust Office" shall mean the office of the Trustee at
which the corporate trust business of the Trustee shall, at any particular time,
be principally administered, which office is, at the date of execution of this
Indenture, located at 100 Federal Street, Boston, Massachusetts 02110;
Attention: Corporate Trust Division.

      Defaulted Interest:

      The term "Defaulted Interest" shall have the meaning ascribed to it in
Section 2.10.

Event of Default:

      The term "Event of Default" shall mean any event specified in Section 7.01
which shall have continued for the period of time and with the notice, if any,
therein designated.

      Fair Value:

      The term "Fair Value" when used with respect to Common Stock shall mean
the fair value as determined in good faith by the Board of Directors.

      Indenture:

      The term "Indenture" shall mean this instrument as originally executed,
or, if amended or supplemented as herein provided, as so amended or
supplemented.

      Interest Payment Date:

      The term "Interest Payment Date" shall mean the date on which interest on
a series of outstanding Securities is due and payable as provided in Section
2.02.

      Non-Recourse Indebtedness:

      The term "Non-Recourse Indebtedness" shall mean indebtedness for borrowed
money as to which the liability of the Company or its Principal Insurance
Subsidiaries is limited solely to specific assets.

<PAGE>   13
                                       4

      Officers' Certificate:

      The term "Officers' Certificate" shall mean a certificate signed by the
chairman, the president, or any vice president and by any other vice president,
the treasurer, any assistant treasurer, the secretary or any assistant secretary
of the Company. Each such certificate shall include the statements provided for
in Section 14.04, if and to the extent required by the provisions thereof.

      Opinion of Counsel:

      The term "Opinion of Counsel" shall mean an opinion in writing signed by
legal counsel who may be an employee of or counsel to the Company or who may be
other counsel satisfactory to the Trustee. Each such opinion shall include the
statements provided for in Section 14.04, if and to the extent required by the
provisions thereof.

      Original Issue Discount Security:

      The term "Original Issue Discount Security" shall mean any Security which
provides for an amount less than the principal amount thereof to be due and
payable upon declaration of acceleration of maturity thereof pursuant to Section
7.01.

      Person:

      The term "person" shall mean an individual, a corporation, a partnership,
an association, a joint-stock company, a trust, an unincorporated organization
or a government or any agency or political subdivision thereof.

      Predecessor Security:

      The term "Predecessor Security" shall mean, in reference to any particular
Security, each and 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 2.07
in lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as such mutilated, destroyed, lost or stolen Security.

      Principal Insurance Subsidiary:

      The term "Principal Insurance Subsidiary" shall mean only Aetna Life
Insurance Company and The Aetna Casualty and Surety Company, 
<PAGE>   14
                                       5

and any other subsidiary of the Company, including subsidiaries of subsidiaries,
which shall hereafter succeed by merger or otherwise to a major part of the
business of one or more of the Principal Insurance Subsidiaries. The decision as
to whether a subsidiary shall have succeeded to a major part of the business of
one or more of the Principal Insurance Subsidiaries shall be made in good faith
by the Board of Directors by the adoption of a resolution so stating, and the
Company shall within 30 days of the date of the adoption of such resolution
deliver to the Trustee a copy thereof, certified by the secretary or an
assistant secretary of the Company.

      Register:

      The term "register" shall mean the registry books of the Company, in which
are maintained the names and addresses of Security holders, and such other
information as is required by Section 2.06.

      Regular Record Date:

      The term "Regular Record Date" for the interest payable on any Interest
Payment Date on the Securities of any series shall mean the date specified for
that purpose as contemplated by Section 2.02.

      Responsible officer:

      The term "responsible officer" when used with respect to the Trustee shall
mean the chairman of the board of directors, the vice chairman of the board of
directors, the chairman of the trust committee, the president, any vice
president, the secretary, the treasurer, any trust officer, any assistant trust
officer, any second or assistant vice president, the cashier, any assistant
cashier, any assistant secretary, any assistant treasurer, or any other officer
or assistant officer of the Trustee customarily performing functions similar to
those performed by the persons who at the time shall be such officers or to whom
any corporate trust matter is referred because of his knowledge of and
familiarity with the particular subject.

      Security; Outstanding:

      The term "Security" shall mean any Security of any series authenticated
and delivered under this Indenture.

      The term "outstanding," when used with reference to Securities, shall,
except as otherwise provided in Section 8.08 and subject to the 
<PAGE>   15
                                       6

provisions of Section 9.04, mean, as of any particular time, all Securities
authenticated and delivered by the Trustee under this Indenture, except

            (a) Securities theretofore cancelled by the Trustee or delivered to
      the Trustee for cancellation;

            (b) Securities, or portions thereof, for the payment or redemption
      of which moneys in the necessary amount shall have been deposited in trust
      with the Trustee or with any paying agent (other than the Company) or
      shall have been set aside, segregated and held in trust by the Company (if
      the Company shall act as its own paying agent); provided, however, that if
      such Securities are to be redeemed, notice of such redemption shall have
      been given as in Article Three provided, or provision satisfactory to the
      Trustee shall have been made for giving such notice; and

            (c) Securities in substitution for which other Securities shall have
      been authenticated and delivered pursuant to the terms of Section 2.07,
      other than any such Securities with respect to which there has been
      presented proof satisfactory to the Trustee that any of such Securities is
      held by a holder as to whom such Security is a valid, binding and legal
      obligation of the Company.

      In determining whether the holders of the requisite principal amount of
Securities outstanding have given any direction, consent or waiver hereunder,
the principal amount of an Original Issue Discount Security that shall be deemed
to be outstanding for such purposes shall be the amount of the principal thereof
that would be due and payable as of the date of such determination upon the
declaration of acceleration of maturity thereof pursuant to Section 7.01.

      Security holder:

      The terms "Security holder," "holder of Securities," "registered holder,"
or other similar terms, shall mean the person in whose name the particular
Security shall at the time be listed in the register kept for that purpose in
accordance with the terms of this Indenture.

      Sinking fund redemption price:

      The term "sinking fund redemption price," when used with respect to any
Security to be redeemed pursuant to Section 3.04, shall mean the price at which
such Security is to be redeemed, as set forth in an indenture supplemental
hereto, a resolution of the Board of Directors or a written instrument executed
by one or more duly authorized officers of the 
<PAGE>   16
                                       7

Company setting forth the terms of such Security in accordance with Section
2.02. 

      Special Record Date:

      The term "Special Record Date" shall mean that date fixed by the Trustee,
pursuant to Section 2.10.

      Subsidiary:

      The term "subsidiary" shall mean any corporation more than 50% of the
voting stock of which at the time is owned or controlled, directly or
indirectly, by the Company.

      Trustee:

      The term "Trustee" shall mean The First National Bank of Boston and,
subject to the provisions of Article Eight, shall also include any successor
trustee.

      Trust Indenture Act of 1939:

      Except as otherwise provided in Sections 11.01 and 11.02, the term "Trust
Indenture Act of 1939" shall mean the Trust Indenture Act of 1939 as in force at
the date as of which this Indenture was originally executed by the Company.

      U.S. Government Obligations:

      The term "U.S. Government Obligations" shall mean securities that are (i)
direct obligations of the United States of America for the payment of which its
full faith and credit is pledged or (ii) obligations of an entity 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 under
clause (i) or (ii), are not callable or redeemable at the option of the issuer
thereof, and shall also include a depository receipt issued by a bank or trust
company as custodian with respect to any such U.S. Government Obligation or a
specific payment of interest on or principal of any such U.S. Government
Obligation held by such custodian for the account of the holder of a depository
receipt, 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
depository receipt from any amount received by the custodian in respect of the
U.S. Government Obligation or the specific payment of interest on or 
<PAGE>   17
                                       8

principal of the U.S. Government Obligation evidenced by such depository
receipt.

      Voting stock:

      The term "voting stock" shall mean securities of any class or classes of a
corporation the holders of which are ordinarily, in the absence of
contingencies, entitled to elect a majority of the directors (or persons
performing similar functions) of such corporation.

      Yield to Maturity:

      The term "Yield to Maturity" shall mean the yield to maturity on a series
of Securities, calculated at the time of issuance of such series or, if
applicable, at the most recent redetermination of interest on such series, and
calculated in accordance with generally accepted financial practice.

                                  ARTICLE TWO

              ISSUE, EXECUTION, FORM AND REGISTRATION OF SECURITIES

      SECTION 2.01. Generally. Upon the execution of this Indenture, or from
time to time thereafter, Securities may be authenticated and delivered under
this Indenture.

      SECTION 2.02. Form of Securities; Issuable in Series; Terms. The
Securities may be issued in one or more series and shall be in substantially the
form as shall be established by or pursuant to one or more indentures
supplemental hereto, a resolution of the Board of Directors or a written
instrument executed by one or more duly authorized officers of the Company, 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 any law or with
any rules made pursuant thereto or with any 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.

      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.

<PAGE>   18
                                        9


      There shall be established in or pursuant to one or more indentures
supplemental hereto, a resolution of the Board of Directors or a written
instrument executed by one or more duly authorized officers of the Company,
prior to the issuance of Securities of any series:

            (1) the title of the Securities of the series (which shall
      distinguish the Securities of the series from all Securities of other
      series);

            (2) any limit upon the aggregate principal amount of the Securities
      of the series that may be authenticated and delivered under this indenture
      (except as provided in Section 2.07);

            (3) the date or dates on which the principal and premium, if any, of
      the Securities of the series is payable;

            (4) the rate or rates at which the Securities of the series shall
      bear interest, if any, or the method by which such rate or rates shall be
      determined, the date or dates from which such interest shall accrue, the
      interest payment dates on which such interest shall be payable (the
      "Interest Payment Dates") and the record dates for the determination of
      Security holders to whom interest is payable;

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

            (6) the price or prices at which, the period or periods within 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, pursuant to
      any sinking fund or otherwise;

            (7) 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 registered holder thereof and the price
      or prices at which and the period or periods within which and the terms
      and conditions upon which Securities of the series shall be redeemed or
      purchased in whole or in part, pursuant to such obligation;

            (8) the obligation, if any, of the Company to repay Securities of
      the series prior to the date on which the principal of the Security is due
      as set forth in that Security and the period or periods within which, the
      price or prices at which and the terms and conditions upon which
      Securities of the series shall be repaid, in whole or in part, pursuant to
      such obligation;
<PAGE>   19
                                       10

            (9) the terms of any right to convert Securities of the series into
      shares of Common Stock of the Company, other securities or property;

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

            (11) 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
      7.01 or provable in bankruptcy pursuant to Section 7.02;

            (12) any Events of Default with respect to the Securities of the
      series, if not set forth herein;

            (13) any restriction or condition on the transferability of the
      Securities of the series;

            (14) any other terms of the series (which terms shall not be
      inconsistent with the provisions of this Indenture); and

            (15) any authenticating or paying agents, registrars, conversion
      agents or any other agents with respect to the Securities of the series.

      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 any
such indenture supplemental hereto or any such resolution or written instrument.

      SECTION 2.03. Denominations. The Securities of each series shall be
issuable in registered form without coupons in such denominations as shall be
specified in an indenture supplemental hereto, a resolution of the Board of
Directors or a written instrument executed by one or more duly authorized
officers of the Company. In the absence of any such specification with respect
to the Securities of any series, the Securities of that series shall be issuable
in denominations of $1,000 and any integral multiple thereof.

      SECTION 2.04. Execution. The Securities shall be signed on behalf of the
Company by its chairman, its president, or any vice president and by any other
vice president, its treasurer, any assistant treasurer, its secretary or any
assistant secretary under its corporate seal. Such signatures may be manual or
facsimile signatures and may be imprinted or otherwise reproduced on the
Securities. The seal of the Company may be 
<PAGE>   20
                                       11

in the form of a facsimile thereof and may be impressed, affixed, imprinted or
otherwise reproduced on the Securities. In case any officer of the Company who
shall have signed any of the Securities either manually or by facsimile
signature shall cease to be such officer before the Securities so signed have
been authenticated and delivered by the Trustee, or disposed of by the Company,
such Securities nevertheless may be authenticated and delivered or disposed of
as though the person who signed such Securities had not ceased to be such
officer of the Company; and any Security may be signed on behalf of the Company
by such persons as, at the actual time of execution of such Security, shall be
the proper officers of the Company, although at the date of such Security or of
the execution of this Indenture any such person was not such officer. Minor
typographical and other minor errors in the text of any Security or minor
defects in the seal or facsimile signature on any Security shall not affect the
validity or enforceability of such Security if it has been duly authenticated
and delivered by the Trustee.

      SECTION 2.05. Authentication and Dating. 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. Except as otherwise provided in this Article Two, the Trustee
shall thereupon authenticate and deliver such Securities to or upon the written
order of the Company, signed by its chairman, president or any vice president.
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 8.01) shall be fully protected in
relying upon:

            (1) a copy of any resolution or resolutions of the Board of
      Directors or of any written instrument executed by one or more duly
      authorized officers of the Company relating thereto and, if applicable, an
      appropriate record of any action taken pursuant to such resolution or
      instrument, in each case certified by the Secretary or an Assistant
      Secretary of the Company;

            (2) an executed supplemental indenture, if any;

            (3) an Officers' Certificate; and

<PAGE>   21
                                       12

            (4) an Opinion of Counsel which shall state

                  (a) that the form and terms of such Securities have been
            established by or pursuant to a supplemental indenture, a resolution
            of the Board of Directors or a written instrument executed by one or
            more duly authorized officers of the Company as permitted by Section
            2.02 in conformity with the provisions of this Indenture;

                  (b) 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,
            reorganization, moratorium and other laws of general applicability
            relating to or affecting the enforcement of creditors' rights
            generally or the rights of creditors of insurance companies
            generally and to general equity principles; and

                  (c) that all requirements under this Indenture for the
            execution and delivery by the Company of the Securities have been
            complied with and that authentication and delivery of the Securities
            by the Trustee will not violate the terms of the Indenture.

      The Trustee shall have the right to decline to authenticate and deliver
any Securities under this Section if the Trustee, being advised by counsel,
determines that such action may not lawfully be taken or if the Trustee in good
faith by its board of directors, executive committee, or a trust committee of
directors or responsible officers of the Trustee shall determine that such
action would expose the Trustee to personal liability to existing holders of
Securities.

      Each Security shall be dated the date of its authentication.

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

      This is one of the series of Securities described in the within-mentioned
Indenture.

                                       THE FIRST NATIONAL BANK OF BOSTON, as 
                                       Trustee


                                       By
                                                   Authorized Officer
<PAGE>   22
                                       13

      Only such Securities as shall bear thereon a certificate of authentication
substantially in the form provided in this Section 2.05, manually executed by
the Trustee shall be entitled to the benefits of this Indenture or be valid or
obligatory for any purpose. Such certificate of authentication of the Trustee
upon any Security executed by the Company shall be conclusive evidence that the
Security so authenticated was duly authenticated and delivered by the Trustee
hereunder.

      SECTION 2.06. Registration, Transfer and Exchange. The Company shall keep
at the office or agency to be maintained for the purpose as provided in Section
5.02, a register in which, subject to such reasonable regulations as it may
prescribe, it shall register Securities and register the transfer of Securities,
as provided in this Article Two. At all reasonable times such register shall be
open for inspection by the Trustee.

      Upon due presentation for registration of transfer of any Security at such
office or agency, the Company shall execute and the Trustee shall authenticate
and deliver in the name of the transferee or transferees a new Security of the
same series for a like aggregate principal amount.

      Any Security may be exchanged for an equal aggregate principal amount of
Securities of the same series in other authorized denominations. Securities to
be exchanged shall be surrendered at the office or agency to be maintained by
the Company for such purpose, as provided in Section 5.02 and the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor the
Security which the Security holder making the exchange shall be entitled to
receive.

      All Securities presented for registration of transfer, exchange,
redemption or payment shall (if so required by the Company or the Trustee) be
duly endorsed by, or be accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company and the Trustee duly executed by,
the Security holder or his attorney duly authorized in writing.

      The Company may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any exchange or
registration of transfer of Securities. No service charge shall be made to the
Security holder for any such transaction.

      The Company shall not be required to exchange or register a transfer of
(i) any Securities of a series for a period of 15 days next preceding any
selection of Securities of such series to be redeemed, or (ii) any Securities
<PAGE>   23
                                       14

selected, called or being called for redemption except, in the case of any
Security to be redeemed in part, the portion thereof not to be so redeemed.

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

      SECTION 2.07. Mutilated, Destroyed, Lost and Stolen Securities. In case
any temporary or definitive Security shall be mutilated, destroyed, lost or
stolen, the Company in its discretion may execute, and upon its request the
Trustee shall authenticate and deliver, a new Security of the same series in
substitution for the Security so mutilated, destroyed, lost or stolen. In every
case the applicant for a substitute Security shall furnish to the Company and to
the Trustee, any paying agent or any Security registrar, such security or
indemnity as any of them may require to save each of them harmless from all
risks, however remote. In every case of destruction, loss or theft, such
applicant shall also furnish to the Company and to the Trustee, any paying agent
and any Security registrar evidence to their satisfaction of the destruction,
loss or theft of such Security and of the ownership thereof, and in every case
of mutilation, such applicant shall surrender to the Trustee the Security so
mutilated.

      The Trustee may authenticate any such substitute Security and deliver the
same upon the written request or authorization of the chairman, president, any
vice president, the treasurer or the secretary of the Company. Upon the issuance
of any substitute Security, 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 connected therewith.

      In case any Security which has matured or is about to mature, or has been
called for redemption in full, shall become mutilated, destroyed, lost or
stolen, the Company may, instead of issuing a substitute Security, pay or
authorize the payment of the same (without surrender thereof except in the case
of a mutilated Security), if the applicant for such payment shall furnish to the
Company and to the Trustee, any paying agent or any Security registrar, such
security or indemnity as any of them may require to save each of them harmless
from all risks, however remote, and evidence to their satisfaction of the
mutilation, destruction, loss or theft of such Security and of the ownership
thereof.

<PAGE>   24
                                       15

      Every substitute Security issued pursuant to the provisions of this
Section 2.07 by virtue of the fact that any Security is mutilated, destroyed,
lost or stolen shall constitute an 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 such series duly issued hereunder. All Securities shall be held and owned
upon the express condition that, to the extent permitted by law, the foregoing
provisions are exclusive with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities and shall preclude any and all
other rights or remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement or payment of
negotiable instruments or other securities without their surrender.

      SECTION 2.08. Cancellation of Securities; Destruction Thereof. All
Securities surrendered for payment, redemption, registration of transfer,
retirement or substitution, if surrendered to the Company or any paying agent or
Security registrar, shall be delivered to the Trustee for cancellation or, if
surrendered to the Trustee, shall be cancelled by it; and no Securities shall be
issued in lieu thereof except as expressly permitted by any of the provisions of
this Indenture. The Trustee shall destroy cancelled Securities and deliver a
certificate of destruction to the Company. Acquisition by the Company of any
Security shall not operate as a redemption or satisfaction of the indebtedness
represented by such Security unless and until the same is delivered to the
Trustee for cancellation.

      SECTION 2.09. Temporary Securities. Pending the preparation of definitive
Securities of any series, the Company may execute and the Trustee shall
authenticate and deliver temporary Securities (printed, lithographed or
typewritten). Temporary Securities shall be issuable without coupons, as
registered Securities of any authorized denomination, and substantially in the
form of the definitive Securities of such series, but with such omissions,
insertions and variations as may be appropriate for temporary Securities, all as
may be determined by the Company. Temporary Securities may contain such
references to any provisions of this Indenture as may be appropriate. Every
temporary Security shall be executed by the Company and be authenticated by the
Trustee upon the same conditions and in substantially the same manner, and with
like
<PAGE>   25
                                       16

effect, as the definitive Securities. As promptly as practicable, the Company
shall execute and shall furnish definitive Securities, and thereupon temporary
Securities of the same series may be surrendered in exchange therefor without
charge at the office or agency to be maintained by the Company for the purpose
pursuant to Section 5.02, and the Trustee shall authenticate and deliver in
exchange for such temporary Securities a like aggregate principal amount of
definitive Securities of the same series of authorized denominations. Until so
exchanged the temporary Securities shall be entitled to the same benefits under
this Indenture as definitive Securities of the same series.

      SECTION 2.10. Defaulted Interest. Any interest on any Security which is
payable, but is not punctually paid or duly provided for, on any Interest
Payment Date (herein called "Defaulted Interest") shall forthwith cease to be
payable to the registered holder on 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 below:

            (a) The Company may elect to make payment of any Defaulted Interest
      to the persons in whose names such Security are registered in the register
      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 to be paid on each such Security and the date of 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 payment, such money when deposited
      to be held in trust for the benefit of the persons entitled to such
      Defaulted Interest as herein provided. Thereupon the Trustee shall fix a
      Special Record Date for the payment of such Defaulted Interest which shall
      not be less than 15 days prior to the date of the proposed payment and not
      less than 15 days after the receipt by the Trustee of the notice of the
      proposed payment. The Trustee shall promptly notify the Company of the
      Special Record Date and, in the name and at the expense of the Company,
      shall give notice of the proposed payment of Defaulted Interest and the
      Special Record Date therefor to each holder of such Securities at his
      address as it appears in the register, 
<PAGE>   26
                                       17


      not less than 10 days prior to the Special Record Date, and Defaulted
      interest shall thereupon be paid to the persons in whose names such
      Securities are registered in the register on the Special Record Date; or

            (b) The Company may make payment of any Defaulted Interest 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 its intention so to make payment, such method of
      payment shall be deemed practicable by the Trustee.

                                  ARTICLE THREE

               REDEMPTION OF SECURITIES-OPTIONAL AND SINKING FUND
                                   REDEMPTIONS

      SECTION 3.01. Applicability of Article. The provisions of this Article
shall be applicable to the Securities of any series which are redeemable before
their maturity, and to any sinking fund for the retirement of a Security of a
series, except as otherwise specified as contemplated by Section 2.02 for the
Securities of such series.

      SECTION 3.02. Notice of Redemption; Partial Redemptions. Notice of
redemption to the holders of Securities of any series to be redeemed in whole or
in part shall be given at least 30 days and not more than 60 days prior to the
date fixed for redemption, to such holders at their last addresses as they shall
appear in the register. Failure to give notice, or any defect in the notice, to
the holder of any Security of a series designated for redemption as a whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Security of such series.

      The notice of redemption to each holder shall specify the principal amount
of the Securities of such series held by such holder to be redeemed, the date
fixed for redemption, the redemption price, the place or places of payment, that
payment will be made upon presentation and surrender of such Securities, that
such redemption is pursuant to the mandatory or optional sinking fund, or both,
if such be the case, that interest accrued to the date fixed for redemption will
be paid as specified in said notice and that on and after said date interest
thereon or on the portions thereof to be redeemed will cease to accrue. In case
any Security is to be redeemed in part only, the notice of redemption shall
state the 
<PAGE>   27
                                       18

portion of the principal amount thereof to be redeemed and shall state that on
and after the date fixed for redemption, upon surrender of such Security, a new
Security of the same series in aggregate principal amount equal to the
unredeemed portion thereof will be issued.

      Any notice of redemption of Securities at the option 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.

      If less than all the Securities of a series are to be redeemed, the 
Trustee shall select the Securities of such series to be redeemed pro rata or 
by lot. Securities may be redeemed in part in multiples equal to the minimum 
authorized denomination for Securities of such series or any multiple thereof. 
At least 45 days prior to the date fixed for redemption, the Trustee shall 
notify the Company in writing of the Securities so selected for redemption and, 
in the case of any such 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 of a series shall relate, in the case of any such
Security redeemed or to be redeemed only in part, to the portion of the
principal amount of such Security which has been or is to be redeemed.

      At least one business day prior to the redemption date specified in the
notice of redemption, the Company shall deposit with the Trustee or with one or
more paying agents, or, if the Company is acting as its own paying agent, set
aside, segregate and hold in trust as provided in paragraph (c) of Section 5.04,
an amount of money sufficient to redeem on the redemption date all the
Securities of such series so called for redemption at the appropriate redemption
price, together with interest accrued thereon to the date fixed for redemption.
If less than all the outstanding Securities of such series are to be redeemed,
the Company shall deliver to the Trustee at least 60 days prior to the date
fixed for redemption a written instrument stating the aggregate principal amount
of Securities of such series to be redeemed, and stating that no Event of
Default has occurred and is continuing or, if continuing, has not been waived.

      SECTION 3.03. Payment of Securities Called for Redemption. If notice of
redemption has been given as above provided, the Securities or portions of
Securities specified in such notice shall become due and payable on the date and
at the place stated in such notice at the applicable redemption price, together
with any interest accrued thereon to the date 
<PAGE>   28
                                       19

fixed for redemption, and on and after such date (unless the Company shall
default in the payment of such Securities at the redemption price, together with
interest accrued thereon to such date) interest on the Securities or portions of
Securities so called for redemption shall cease to accrue, and, except as
provided in Sections 8.05 and 13.04, such Securities shall cease from and after
the date fixed for redemption to be entitled to any benefit or security under
this Indenture, and the holders thereof shall have no right in respect of such
Securities, except the right to receive the redemption price thereof and unpaid
interest to the date fixed for redemption. On presentation and surrender of such
Securities at a place of payment specified in said notice, such Securities or
the specified portions thereof shall be paid and redeemed by the Company at the
applicable redemption price, together with interest accrued thereon to the date
fixed for redemption; provided, however, that if the date fixed for redemption
is an Interest Payment Date, any payment of interest becoming due on such date
fixed for redemption shall be payable to the holders of such Securities
registered as such on the Regular Record Date therefor.

      If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal shall, until paid or duly provided for,
bear interest from the date fixed for redemption at the rate of interest or
Yield to Maturity (in the case of an Original Issue Discount Security) borne by
the Security.

      Upon presentation of any Security redeemed in part only, the Company shall
execute and the Trustee shall authenticate and deliver to or on the order of the
holder thereof, at the expense of the Company, a new Security or Securities of
the same series, of authorized denominations, in aggregate principal amount
equal to the unredeemed portion of the Security so presented.

      SECTION 3.04. Sinking Fund Redemptions. 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."

      In lieu of making all or any part of any mandatory sinking fund payment
with respect to any series of Securities in cash, the Company may at its option
(i) deliver to the Trustee Securities of such series theretofore acquired by the
Company or receive credit for Securities of 
<PAGE>   29
                                       20

such series (not previously so credited) theretofore acquired (except upon
redemption pursuant to the mandatory sinking fund) by the Company and delivered
to the Trustee for cancellation pursuant to Section 2.08 or (ii) receive credit
for Securities of such series (not previously so credited) which have been
converted pursuant to Article 4 or redeemed either at the election of the
Company pursuant to the terms of such Security or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities. Securities so delivered or credited shall be received or credited by
the Trustee at the sinking fund redemption price specified in such Securities.

      On or before the fiftieth day next preceding the due date of each sinking
fund payment, the Company shall give to the Trustee (i) a written instrument
specifying the portions of such sinking fund payment to be satisfied by payment
of cash, by delivery of (or credit for previously cancelled), Securities of such
series theretofore acquired, by credit for optional sinking fund payments
previously made or by credit for Securities of such series converted pursuant to
Article 4 or optionally redeemed by the Company; stating that no such Securities
of such series or optional sinking fund payments have theretofore been made the
basis of any credit against any mandatory sinking fund payment; and stating that
no Event of Default has occurred and is continuing or, if continuing, has not
been waived; and (ii) such acquired, converted or redeemed Securities to the
extent not previously surrendered and cancelled. All Securities so delivered to
the Trustee shall be cancelled by the Trustee and no Securities shall be
authenticated in lieu thereof. In case of the failure of the Company to give
such notice at or before the time so required, the Company shall be permitted to
make such mandatory sinking fund payment only in cash.

      If any sinking fund payment or payments (mandatory or optional or both)
with respect to the Securities of any particular series which is to be made in
cash shall amount to $50,000 or more (or a lesser sum if consented to by the
Trustee upon the written request of the Company), the Trustee shall select, in
the manner provided in Section 3.02, such an aggregate principal amount of
outstanding Securities of such series for redemption on the due date for such
sinking fund payment as will exhaust such moneys, as nearly as may be, at the
sinking fund redemption price, and the Trustee shall cause notice of redemption
of such Securities to be given in the name of the Company and in the manner
provided in Section 
<PAGE>   30
                                       21

3.02, except that the notice given hereunder shall state that such redemption is
for sinking fund purposes; and on and after such sinking fund payment date, if
the necessary funds have been deposited with it, the Trustee shall apply or
cause to be applied such sinking fund moneys in the manner and with the effect
provided in Section 3.03 to the redemption of the Securities so selected.

      Any such sinking fund moneys not so applied by the Trustee to the
redemption of Securities of such series shall be added to the next cash sinking
fund payment with respect to Securities of such series received by the Trustee,
and together with such payment shall be applied in accordance with the preceding
paragraph. Any and all such sinking fund moneys held by the Trustee on the last
sinking fund payment date and not held for the payment or redemption of
particular Securities of such series shall be applied by the Trustee together
with other moneys, if necessary, to be deposited sufficient for the purpose, to
the payment of the principal of the Securities of such series at maturity.

      The Trustee shall not redeem or cause to be redeemed any Securities of a
series with such sinking fund moneys or give any notice of redemption of
Securities for such series by operation of the sinking fund during the
continuance of a default in payment of interest on such Securities or of any
Event of Default with respect to such series of which the Trustee shall have
notice except that, where the mailing of notice of redemption of any Securities
shall theretofore have been made, the Trustee shall redeem or cause to be
redeemed such Securities; provided, however, that it shall have received from
the Company a sum sufficient for such redemption. Except as aforesaid, any
moneys in the sinking fund for such series at the time when any such default or
Event of Default shall occur, and any moneys thereafter paid into the sinking
fund, shall, during the continuance of such default or Event of Default, be held
as security for the payment of all Securities of such series. In case such
default or Event of Default shall have been remedied or waived as provided in
Section 7.09, such moneys shall thereafter be applied on the next sinking fund
payment date in accordance with this Section 3.04, to the redemption of such
Securities of the series with respect to which such sinking fund payments were
made.

      SECTION 3.05. Exclusion of Company Owned Securities. Securities shall be
excluded from eligibility for selection for redemption if they are (a) (i) owned
of record by the Company, as shown by the register, or by any person known by
the Trustee to be directly or indirectly controlling 
<PAGE>   31
                                       22

or controlled by or under direct or indirect common control with the Company,
and (ii) not known by the Trustee to have been pledged or hypothecated by the
Company or any such person, or (b) identified by number in a written instrument
delivered by the Company to the Trustee at least 60 days prior to the date fixed
for redemption as being beneficially owned by, and not pledged or hypothecated
by, the Company, or by any person specifically identified in such written
instrument as directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company. Delivery of such written
instrument shall be at the discretion of the Company. The Trustee shall not be
charged with any knowledge referred to in clause (a) of this Section 3.05,
unless a responsible officer of the Trustee assigned to its corporate trust
division shall, as such officer, have actual knowledge to such effect.

                                  ARTICLE FOUR

                            CONVERSION OF SECURITIES

      SECTION 4.01. Applicability of Article. The provisions of this Article
shall be applicable to the Securities of any series which are convertible into
shares of Common Stock of the Company, and the issuance of such shares of Common
Stock upon the conversion of such Securities, except as otherwise specified as
contemplated by Section 2.02 for the Securities of such series.

      SECTION 4.02. Exercise of Conversion Privilege. In order to exercise a
conversion privilege, the holder of a Security of a series with such a privilege
shall surrender such Security to the Company at the office or agency maintained
for that purpose pursuant to Section 5.02, accompanied by written notice to the
Company that the holder elects to convert such Security or a specified portion
thereof. Such notice shall also state, if different from the name and address of
such holder, the name or names (with address) in which the certificate or
certificates for shares of Common Stock which shall be issuable on such
conversion shall be issued. Securities surrendered for conversion shall (if so
required by the Company or the Trustee) be duly endorsed by or accompanied by
instruments of transfer in forms satisfactory to the Company duly executed by
the registered holder or his attorney duly authorized in writing; and Securities
so surrendered for conversion during the period from the close of business on
any Regular Record Date to the opening of business on the next succeeding
Interest Payment Date (excluding Securities or portions 
<PAGE>   32
                                       23

thereof called for redemption during such period) shall also be accompanied by
payment in funds acceptable to the Company of an amount equal to the interest
payable on such Interest Payment Date on the principal amount of such Security
then being converted, and such interest shall be payable to such registered
holder notwithstanding the conversion of such Security. As promptly as
practicable after the receipt of such notice and of any payment required
pursuant to the supplemental indenture, resolutions of the Board of Directors or
written instruments executed by one or more duly authorized officers of the
Company setting forth the terms of such series of Security, and the surrender of
such Security in accordance with such reasonable regulations as the Company may
prescribe, the Company shall issue and shall deliver, at the office or agency at
which such Security is surrendered, to such holder or on his written order, a
certificate or certificates for the number of full shares of Common Stock
issuable upon the conversion of such Security (or specified portion thereof), in
accordance with the provisions of such supplemental indenture, resolution or
written instrument, and cash as provided therein in respect of any fractional
share of such Common Stock otherwise issuable upon such conversion. Such
conversion shall be deemed to have been effected immediately prior to the close
of business on the date on which such notice and such payment, if required,
shall have been received in proper order for conversion by the Company and such
Security shall have been surrendered as aforesaid (unless such holder shall have
so surrendered such Security and shall have instructed the Company to effect the
conversion on a particular date following such surrender and such holder shall
be entitled to convert such Security on such date, in which case such conversion
shall be deemed to be effected immediately prior to the close of business on
such date) and at such time the rights of the holder of such Security as such
Security holder shall cease and the person or persons in whose name or names any
certificate or certificates for shares of Common Stock of the Company shall be
issuable upon such conversion shall be deemed to have become the holder or
holders of record of the shares represented thereby. Subject to the requirement
for a payment in the event of conversion after the close of business on a
Regular Record Date, no payment or adjustment shall be made upon any conversion
on account of any interest accrued on the Securities surrendered for conversion
or on account of any dividends on the Common Stock of the Company issued upon
such conversion.
<PAGE>   33
                                       24


      In the case of any Security which is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and
deliver to or on the order of the holder thereof, at the expense of the Company,
a new Security or Securities of the same series, of authorized denominations, in
aggregate principal amount equal to the unconverted portion of such Security.

      SECTION 4.03. No Fractional Shares. No fractional share of Common Stock of
the Company shall be issued upon conversions of Securities of any series. If
more than one Security shall be surrendered for conversion at one time by the
same holder, the number of full shares which shall be issuable upon conversion
shall be computed on the basis of the aggregate principal amount of the
Securities (or specified portions thereof to the extent permitted hereby) so
surrendered. If, except for the provisions of this Section 4.03, any holder of a
Security or Securities would be entitled to a fractional share of Common Stock
of the Company upon the conversion of such Security or Securities, or specified
portions thereof, the Company shall pay to such holder an amount in cash equal
to the current market value of such fractional share, computed, (i) if such
Common Stock is at the time reported on the Composite Transactions tape, on the
basis of the last reported sale price regular way on the last business day prior
to the date of conversion upon which such a sale shall have been effected, as
reported on the Composite Transactions tape, or (ii) if such Common Stock is not
at the time reported on the Composite Transactions tape but is listed or
admitted to unlisted trading privileges on a national securities exchange, on
the basis of the last reported sale price regular way on such exchange on the
last business day prior to the date of conversion upon which such a sale shall
have been effected, or (iii) if such Common Stock is not at the time so reported
on the Composite Transactions tape or so listed or admitted to unlisted trading
privileges on a national securities exchange, on the basis of the average of the
bid and asked prices of such Common Stock in the over-the-counter market, on the
last business day prior to the date of conversion, as reported by the National
Quotation Bureau, Incorporated or similar organization if the National Quotation
Bureau, Incorporated is no longer reporting such information, or if not so
available, the fair market price as determined by the Board of Directors.

      SECTION 4.04. Adjustment to Conversion Price. The conversion price of
Securities of any series that is convertible into Common Stock of the Company
shall be adjusted for any stock dividends, stock splits, 
<PAGE>   34
                                       25

reclassifications, combinations or similar transactions in accordance with the
terms of the supplemental indenture, resolutions of the Board of Directors or
written instrument executed by one or more duly authorized officers of the
Company, setting forth the terms of the Securities of such series.

      Whenever the conversion price is adjusted, the Company shall compute the
adjusted conversion price in accordance with terms of the applicable
supplemental indenture, resolution or written instrument and shall prepare an
Officers' Certificate setting forth the adjusted conversion price and showing in
reasonable detail the facts upon which such adjustment is based, and such
certificate shall forthwith be filed at the office or agency maintained for the
purpose of conversion of Securities pursuant to Section 5.02 and, if different,
with the Trustee. The Company shall forthwith cause a notice setting forth the
adjusted conversion price to be mailed, first class postage prepaid, to each
holder of Securities of such series at his address appearing on the Security
register and to any conversion agent other than the Trustee.

      SECTION 4.05. Reservation of Shares of Common Stock. The Company shall at
all times reserve and keep available, free from preemptive rights, out of its
authorized but unissued Common Stock, for the purpose of effecting the
conversion of Securities, the full number of shares of Common Stock of the
Company then issuable upon the conversion of all outstanding Securities of any
series that has conversion rights.

      SECTION 4.06. Payment of Certain Taxes Upon Conversion. The Company will
pay any and all taxes that may be payable in respect of the issue or delivery of
shares of its Common Stock on conversion of Securities pursuant hereto. The
Company shall not, however, be required to pay any tax which may be payable in
respect of any transfer involved in the issue and delivery of shares of its
Common Stock in a name other than that of the holder of the Security or
Securities to be converted, and no such issue or delivery shall be made unless
and until the person requesting such issue has paid to the Company the amount of
any such tax, or has established, to the satisfaction of the Company, that such
tax has been paid.

      SECTION 4.07. Nonassessability. The Company covenants that all shares of
its Common Stock which may be issued upon conversion of 
<PAGE>   35
                                       26


Securities will upon issue in accordance with the terms hereof be duly and
validly issued and fully paid and nonassessable.

      SECTION 4.08. Effect of Consolidation or Merger on Conversion Privilege.
In case of any consolidation of the Company with, or merger of the Company into
or with any other corporation, or in case of any sale or transfer of all or
substantially all of the assets of the Company, the Company or the corporation
formed by such consolidation or the corporation into which the Company shall
have been merged or the corporation which shall have acquired such assets, as
the case may be, shall execute and deliver to the Trustee a supplemental
indenture providing that the holder of each Security then outstanding of any
series that is convertible into Common Stock of the Company shall have the
right, which right shall be the exclusive conversion right thereafter available
to said holder (until the expiration of the conversion right of such Security),
to convert such Security into the kind and amount of shares of stock or other
securities or property (including cash) receivable upon such consolidation,
merger, sale or transfer by a holder of the number of shares of Common Stock of
the Company into which such Security might have been converted immediately prior
to such consolidation, merger, sale or transfer, subject to compliance with the
other provisions of this Indenture, such Security and such supplemental
indenture. Such supplemental indenture shall provide for adjustments which shall
be as nearly equivalent as may be practicable to the adjustments provided for in
such Security. The above provisions of this Section shall similarly apply to
successive consolidations, mergers, sales or transfers. It is expressly agreed
and understood that anything in this Indenture to the contrary notwithstanding,
if, pursuant to such merger, consolidation, sale or transfer, holders of
outstanding shares of Common Stock of the Company do not receive shares of
common stock of the surviving corporation but receive other securities, cash or
other property or any combination thereof, holders of Securities shall not have
the right to thereafter convert their Securities into common stock of the
surviving corporation or the corporation which shall have acquired such assets,
but rather, shall have the right upon such conversion to receive the other
securities, cash or other property receivable by a holder of the number of
shares of Common Stock of the Company into which the Securities held by such
holder might have been converted immediately prior to such consolidation,
merger, sale or transfer, all as more fully provided in the first sentence of
this Section 4.08. Anything in this Section 4.08 to the contrary
notwithstanding, the provisions of this  

<PAGE>   36
                                       27

Section 4.08 shall not apply to a merger or consolidation of another with or
into the Company pursuant to which both of the following conditions are
applicable: (i) the Company is the surviving corporation and (ii) the
outstanding shares of the Common Stock of the Company are not changed or
converted into any other securities or properties (including cash) or changed in
number or character pursuant to the terms of such merger or consolidation.

      As evidence of the kind and amount of shares of stock or other securities
or property (including cash) into which Securities may properly be convertible
after any such consolidation, merger, sale or transfer, or as to the appropriate
adjustments of the conversion prices applicable with respect thereto, the
Trustee shall be furnished with and may accept the certificate or opinion of an
independent certified public accountant with respect thereto; and, in the
absence of bad faith on the part of the Trustee, the Trustee may conclusively
rely thereon, and shall not be responsible or accountable to any holder of
Securities for any provision in conformity therewith or approved by such
independent certified accountant which may be contained in said supplemental
indenture.

      SECTION 4.09. Duties of Trustee Regarding Conversion. Neither the Trustee
nor any conversion agent shall at any time be under any duty or responsibility
to any holder of Securities of any series that is convertible into Common Stock
of the Company to determine whether any facts exist which may require any
adjustment of the conversion price, or with respect to the nature or extent of
any such adjustment when made, or with respect to the method employed, whether
herein or in any supplemental indenture, any resolutions of the Board of
Directors or written instrument executed by one or more officers of the Company
provided to be employed in making the same. Neither the Trustee nor any
conversion agent shall be accountable with respect to the validity or value (or
the kind or amount) of any shares of Common Stock of the Company, or of any
securities or property, which may at any time be issued or delivered upon the
conversion of any Security and neither the Trustee nor any conversion agent
makes any representation with respect thereto. Subject to the provisions of
Section 8.01, neither the Trustee nor any conversion agent shall be responsible
for any failure of the Company to issue, transfer or deliver any shares of its
Common Stock or stock certificates or other securities or property upon the
surrender of any Security for the purpose of conversion or to comply with any of
the covenants of the Company 
<PAGE>   37
                                       28


contained in this Article Four or in the applicable supplemental indenture,
resolutions of the Board of Directors or written instrument executed by one or
more duly authorized officers of the Company.

      SECTION 4.10. Repayment of Certain Funds Upon Conversion. Any funds which
at any time shall have been deposited by the Company or on its behalf with the
Trustee or any other paying agent for the purpose of paying the principal of,
and premium, if any, and interest, if any, on any of the Securities (including
funds deposited for the sinking fund referred to in Article Three hereof) and
which shall not be required for such purposes because of the conversion of such
Securities as provided in this Article Four shall after such conversion be
repaid to the Company by the Trustee upon the Company's written request.

                                  ARTICLE FIVE

                       PARTICULAR COVENANTS OF THE COMPANY

      The Company covenants and agrees as follows:

      SECTION 5.01. Payment of Principal of and Interest on Securities. The
Company covenants and agrees for the benefit of each series of Securities that
it will duly and punctually pay or cause to be paid the principal of, and
premium, if any, and interest, if any, on the Securities of such series at the
times and places, and in the manner provided in such Securities. The principal
of, and premium, if any, and interest, if any, on the Securities shall be
payable only to or upon the written order of the holders thereof. At the option
of the Company, any installment of interest on the Securities may be paid by
mailing checks for such interest payable to or upon the written order of the
holders of Securities entitled thereto as such holders shall appear in the
register.

      SECTION 5.02. Maintenance of Offices or Agencies for Registration,
Transfer, Exchange, Conversion and Payment of Securities. As long as any of the
Securities remain outstanding, the Company will maintain, in the Borough of
Manhattan, The City of New York, State of New York, an office or agency where
the Securities may be presented for payment, or for registration, registration
of transfer or exchange or conversion as in this Indenture provided, and where
notices and demands to or upon the Company in respect of the Securities or of
this Indenture may be served.

      The Company will give to the Trustee notice of the location of each office
or agency required to be maintained by this Section 5.02 and of any  
<PAGE>   38
                                       29


change in the location thereof. With respect to each series of Securities whose
terms are established pursuant to Section 2.02 the Company hereby designates its
office or agency specified in accordance with Section 2.02, as its initial
office to be maintained by it for each such purpose. In case the Company shall
fail to maintain such offices or agencies or shall fail to give such notice of
the location or of any change in the location thereof, presentations may be made
and notices and demands may be served at the Trustee's agency office located at
BancBoston Clearance, Inc., One Exchange Place, 55 Broadway, Third Floor, New
York, New York 10006, Attention: Manager.

      SECTION 5.03. Appointment To Fill a Vacancy in Office of Trustee. The
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in Section 8.10, a Trustee, so that there
shall at all times be a Trustee with respect to each series of Securities
hereunder.

         SECTION 5.04. Paying Agents. (a) Whenever the Company shall appoint a
paying agent other than the Trustee with respect to Securities of any series, it
will cause such paying agent to execute and deliver to the Trustee an instrument
in which, subject to the provisions of this Section 5.04, such agent shall agree
with the Trustee:

          (1) that it will hold all sums received by it as such agent for the
      payment of the principal of and premium, if any, and interest, if any, on
      the Securities of such series (whether such sums have been paid to it by
      the Company or by any other obligor on the Securities of such series) in
      trust for the benefit of the holders of the Securities of such series or
      of the Trustee, and

            (2) that it will give to the Trustee notice of any failure by the
      Company (or by any other obligor on the Securities of such series) to make
      any payment of the principal of or premium, if any, or interest, if any,
      on the Securities of such series when the same shall be due and payable.

      (b) The Company will, prior to each due date of the principal of or
premium, if any, or interest, if any, on the Securities of any series, deposit
with the paying agent hereunder a sum sufficient to pay such principal, premium,
if any, or interest, if any, and (unless such paying agent is the Trustee) the
Company will promptly notify the Trustee of any failure to take such action.
<PAGE>   39
                                       30

      (c) If the Company shall act as its own paying agent with respect to the
Securities of any series, it will, on or before each due date of the principal
of, or premium, if any, or interest, if any, on the Securities of such series,
set aside, segregate and hold in trust for the benefit of the holders of the
Securities of such series a sum sufficient to pay such principal, or premium, if
any, or interest, if any, so becoming due. The Company will promptly notify the
Trustee of any failure to take such action.

      (d) Anything in this Section 5.04 to the contrary notwithstanding, the
Company may at any time, for the purpose of obtaining a satisfaction and
discharge of this Indenture with respect to one or more or all series of
Securities hereunder, or for any other reason, pay or cause to be paid to the
Trustee all sums held in trust for any such series by the Company or any paying
agent hereunder, as required by this Section 5.04, such sums to be held by the
Trustee upon the trusts herein contained.

      (e) Anything in this Section 5.04 to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section 5.04 is subject to
the provisions of Sections 13.03 and 13.04.

      SECTION 5.05. Limitations on Liens on Common Stock of Principal Insurance
Subsidiaries. As long as any of the Securities remain outstanding, the Company
will not, and will not permit any Principal Insurance Subsidiary to, issue,
assume, incur or guarantee any indebtedness for borrowed money secured by a
mortgage, pledge, lien or other encumbrance, directly or indirectly, on any of
the Common Stock of a Principal Insurance Subsidiary, which Common Stock is
owned by the Company or by any Principal Insurance Subsidiary, unless 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, such secured indebtedness for borrowed money so long as it is
outstanding.

      SECTION 5.06. Certificates to Trustee. The Company will, on or before May
1 in each year, commencing with the year 1987, file with the Trustee a written
instrument, complying with the provisions of Section 14.04, covering the period
from the date hereof to December 31, 1986, in the case of the first such
certificate, and covering the preceding calendar year in the case of each
subsequent certificate, and stating whether, in the opinion of the signer, the
Company has complied with the covenants, agreements and obligations on its part
contained in Section 5.05, and, if
<PAGE>   40
                                       31

the signer has obtained knowledge of any continuing default by the Company
in the performance, observance or fulfillment of any such covenant, agreement or
obligation, specifying each such default and the nature thereof. 

                                  ARTICLE SIX

                LISTS OF SECURITY HOLDERS; REPORTS BY THE COMPANY
                                 AND THE TRUSTEE

      SECTION 6.01. Company To Furnish Trustee Information as to Names and
Addresses of Security Holders. The Company shall furnish or cause to be
furnished to the Trustee with respect to each series of Securities (i)
semi-annually, not more than 10 days after each Regular Record Date, a list in
such form as the Trustee may reasonably require of the names and addresses of
the holders of such series of Securities as of each such date, and (ii) at such
other times as the Trustee may request in writing, within 30 days after 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; provided,
however, in each case, that so long as the Trustee is the registrar for such
series, no such list shall be required to be furnished.

      SECTION 6.02. Preservation of Information; Communications to Security
Holders. (a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the holders of
each series of Securities (1) contained in the most recent list furnished to it
as provided in Section 6.01, and (2) received by it in the capacity of paying
agent (if so acting) or Security registrar (if so acting) for such series
hereunder. The Trustee may destroy any list furnished to it as provided in
Section 6.01 upon receipt of a new list so furnished.

      (b) In case three or more holders of Securities (hereinafter referred to
as "applicants") apply in writing to the Trustee, and furnish to the Trustee
reasonable proof that each such applicant has owned a Security for a period of
at least six months preceding the date of such application, and such application
states that the applicants desire to communicate with other holders of
Securities of a particular series (in which case the applicants must all hold
Securities of such series) or with holders of all Securities with respect to
their rights under this Indenture or under such Securities and is accompanied by
a copy of the form of proxy or other

<PAGE>   41
                                       32

communication which such applicants propose to transmit, then the Trustee
shall, within five business days after the receipt of such application, at its
election, either

            (1) afford such applicants access to the information preserved at
      the time by the Trustee in accordance with the provisions of paragraph (a)
      of this Section 6.02, or

            (2) inform such applicants as to the approximate number of holders
      of Securities of such series or of all Securities, as the case may be,
      whose names and addresses appear in the information preserved at the time
      by the Trustee, in accordance with the provisions of paragraph (a) of this
      Section 6.02, and as to the approximate cost of mailing to such Security
      holders the form of proxy or other communication, if any, specified in
      such application.

      If the Trustee shall elect not to afford such applicants access to such
information, the Trustee shall, upon the written request of such applicants,
mail to each holder of a Security of such series or all Securities, as the case
may be, whose name and address appear in the information preserved at the time
by the Trustee in accordance with the provisions of paragraph (a) of this
Section 6.02, a copy of the form of proxy or other communication which is
specified in such request, with reasonable promptness after a tender to the
Trustee of the material to be mailed and of payment, or provision for the
payment, of the reasonable expenses of mailing, unless within five days after
such tender the Trustee shall mail to such applicants, and file with the
Commission, together with a copy of the material to be mailed, a written
statement to the effect that, in the opinion of the Trustee, such mailing would
be contrary to the best interests of the holders of Securities of such series or
all Securities, as the case may be, or would be in violation of applicable law.
Such written statement shall specify the basis of such opinion. If the
Commission, after opportunity for a hearing upon the objections specified in the
written statement so filed, shall enter an order refusing to sustain any of such
objections or if, after the entry of an order sustaining one or more of such
objections, the Commission shall find, after notice and opportunity for hearing,
that all the objections so sustained have been met, and shall enter an order so
declaring, the Trustee shall mail copies of such material to all such Security
holders with reasonable promptness after the entry of such order and the renewal
of such tender; otherwise the Trustee shall be relieved of any obligations or
duty to such applicants respecting their application.

<PAGE>   42
                                       33



      (c) Each and every holder of the Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company nor the
Trustee nor any paying agent shall be held accountable by reason of the
disclosure of any such information as to the names and addresses of the holders
of Securities in accordance with the provisions of paragraph (b) of this Section
6.02, regardless of the source from which such information was derived, and that
the Trustee shall not be held accountable by reason of mailing any material
pursuant to a request made under paragraph (b) of this Section 6.02.

      SECTION 6.03. Reports by the Company. The Company covenants and agrees:

      (a) To file with the Trustee, within 15 days after the Company is required
to file the same with the Commission, copies of the annual reports and of the
information, documents, and other reports (or copies of such portions of any of
the foregoing as the Commission may from time to time by rules and regulations
prescribe) which the Company may be required to file with the Commission
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934,
or, if the Company is not required to file information, documents, or reports
pursuant to either of such Sections, then to file with the Trustee and the
Commission, in accordance with rules and regulations prescribed from time to
time by the Commission, such of the supplementary and periodic information,
documents, and reports which may be required pursuant to Section 13 of the
Securities Exchange Act of 1934 in respect of a security listed and registered
on a national securities exchange as may be prescribed from time to time in such
rules and regulations;

      (b) To file with the Trustee and the Commission, in accordance with rules
and regulations prescribed from time to time by the Commission, such additional
information, documents, and reports with respect to compliance by the Company
with the conditions and covenants provided for in this Indenture as may be
required from time to time by such rules and regulations; and

      (c) To transmit to the holders of Securities, within 30 days after the
filing thereof with the Trustee, in the manner and to the extent provided in
paragraph (c) of Section 6.04 with respect to reports pursuant to paragraph (a)
of Section 6.04, such summaries of any information, documents, and reports
required to be filed by the


<PAGE>   43
                                       34

Company pursuant to paragraphs (a) and (b) of this Section 6.03 as may be
required by rules and regulations prescribed from time to time by the
Commission.

      SECTION 6.04. Reports by the Trustee. (a) On or before July 15, 1987, and
on or before July 15, in every year thereafter, so long as any Securities are
outstanding hereunder, the Trustee shall transmit to the Security holders of
each Series, as hereinafter in this Section 6.04 provided, a brief report dated
as of the preceding May 15 with respect to:

            (1) Its eligibility under Section 8.09 and its qualification under
      Section 8.08, or in lieu thereof, if to the best of its knowledge it has
      continued to be eligible and qualified under such Sections, a written
      statement to such effect;

            (2) The character and amount of any advances (and if the Trustee
      elects so to state, the circumstances surrounding the making thereof) made
      by the Trustee (as such) which remain unpaid on the date of such report
      and for the reimbursement of which it claims or may claim a lien or
      charge, prior to that of the Securities of any series, on any property or
      funds held or collected by it as Trustee, except that the Trustee shall
      not be required (but may elect) to report such advances if such advances
      so remaining unpaid aggregate not more than 1/2 of 1% of the principal
      amount of the Securities outstanding of such series on the date of such
      report;

            (3) The amount, interest rate, and maturity date of all other
      indebtedness owing by the Company, (or by any other obligor on the
      Securities) to the Trustee in its individual capacity on the date of such
      report, with a brief description of any property held as collateral
      security therefor, except an indebtedness based upon a creditor
      relationship arising in any manner described in clauses (2), (3), (4) or
      (6) of paragraph (b) of Section 8.13;

            (4) The property and funds, if any, physically in the possession of
      the Trustee (as such) on the date of such report;

            (5) Any additional issue of Securities which the Trustee has not
      previously reported; and

            (6) Any action taken by the Trustee in the performance of its duties
      under this Indenture which it has not previously reported and which in its
      opinion materially affects the Securities, except action in 

<PAGE>   44
                                       35

      respect of a default, notice of which has been or is to be withheld by it
      in accordance with the provisions of Section 7.10.

            (b) The Trustee shall transmit to the Security holders of each
      series, as provided in paragraph (c) of this Section 6.04, a brief report
      with respect to the character and amount of any advances (and if the
      Trustee elects so to state, the circumstances surrounding the making
      thereof) made by the Trustee (as such) since the date of the last report
      transmitted pursuant to the provisions of paragraph (a) of this Section
      6.04 (or if no such report has yet been so transmitted, since the date of
      this Indenture), for the reimbursement of which it claims or may claim a
      lien or charge, prior to that of the Securities of such series, on
      property or funds held or collected by it as Trustee and which it has not
      previously reported pursuant to this paragraph (b) of Section 6.04, except
      that the Trustee shall not be required (but may elect) to report such
      advances if such advances remaining unpaid at any time aggregate not more
      than 10% of the principal amount of Securities of such series outstanding
      at such time, such report to be transmitted within 90 days after such
      time.

            (c) Reports pursuant to this Section 6.04 shall be transmitted by
      mail (i) to all registered holders of Securities, as the names and
      addresses of such holders appear upon the register; (ii) to such holders
      of Securities as have, within two years preceding such transmission,
      filed their names and addresses with the Trustee for that purpose; and
      (iii) except in the case of reports pursuant to paragraph (b) of this
      Section 6.04, to each holder of Securities whose name and address is
      preserved at the time by the Trustee, as provided in paragraph (a) of
      Section 6.02.

            (d) A copy of each such report shall, at the time of such
      transmission to Security holders, be furnished to the Company and be filed
      by the Trustee with each stock exchange upon which the Securities of any
      applicable series are listed and also with the Commission. The Company
      agrees to notify the Trustee when and as the Securities of any series
      become listed on any stock exchange.

                                  ARTICLE SEVEN

                          REMEDIES ON EVENT OF DEFAULT

      SECTION 7.01. Event of Default Defined; Acceleration of Maturity; Waiver
of Default. "Event of Default" whenever used with respect to Securities of a
series means any one of the following events and such other
<PAGE>   45
                                       36


events as may be established with respect to the Securities of such series as
contemplated by Section 2.02 hereof:

            (a) Default in the payment of any installment of interest upon any
      of the Securities of such series as and when the same shall become due and
      payable, and continuance of such default for a period of 30 days; or

            (b) Default in the payment of the principal of or premium, if any,
      on any of the Securities of such series as and when the same shall become
      due and payable either at maturity, upon redemption, by declaration or
      otherwise; or

            (c) Default in the making of any sinking fund payment, whether
      mandatory or optional, as and when the same shall become due and payable
      by the terms of the Securities of such series; or

            (d) Failure on the part of the Company duly to observe or perform in
      any material respect any other of the covenants or agreements on the part
      of the Company contained in this Indenture (other than those set forth
      exclusively in the terms of any other particular series of Securities
      established as contemplated by this Indenture for the benefit of such
      other series) and written notice of such failure, stating that such notice
      is a notice of default hereunder, and requiring the Company to remedy the
      same, shall have been given by registered or certified mail, return
      receipt requested, to the Company by the Trustee, or to the Company and
      the Trustee by the holders of at least 25% in aggregate principal amount
      of the Securities at the time outstanding, and such failure shall have
      continued unremedied for a period of 90 days after the date of the
      Company's receipt of such notice; or

            (e) An event of default, as defined in any indenture or instrument
      evidencing or under which the Company or any Principal Insurance
      Subsidiary has at the date of this Indenture or shall hereafter have
      outstanding indebtedness for borrowed money in a principal amount in
      excess of $10,000,000, shall happen and be continuing and such
      indebtedness shall have been accelerated so that the same shall be or
      become due and payable prior to the date on which the same would otherwise
      have become due and payable (other than acceleration of Non-Recourse
      Indebtedness which does not exceed in the aggregate 4% of the Company's
      total shareholders' 
<PAGE>   46
                                       37


      equity, as set forth in the most recently published audited
      consolidated balance sheet of the Company), and such acceleration
      shall not be waived, rescinded or annulled within ten business days after
      written notice thereof, stating that such notice is a notice of default
      hereunder, shall have been given to the Company by the Trustee (if such
      event be known to it), or to the Company and the Trustee by the holders of
      at least 25% in aggregate principal amount of the Securities at the time
      outstanding; provided, however, that if such acceleration under such
      indenture or instrument shall be remedied or cured by the Company or
      Principal Insurance Subsidiary, or waived, rescinded or annulled by the
      requisite holders of such indebtedness, then the Event of Default
      hereunder by reason thereof shall be deemed likewise to have been
      thereupon remedied, cured or waived without further action upon the part
      of either the Trustee or any of the Security holders; and provided
      further, that, subject to the provisions of Sections 7.10 and 8.01, the
      Trustee shall not be charged with knowledge of any such default unless
      written notice thereof shall have been given to the Trustee by the
      Company, by the holder of any such indebtedness or an agent of the holder
      of any such indebtedness, by the trustee then acting under any such
      indenture or other instrument under which such default shall have
      occurred, or by the holders of at least 25% in aggregate principal amount
      of the Securities at the time outstanding.

            (f) A decree or order by a court having jurisdiction in the premises
      shall have been entered adjudging the Company a bankrupt or insolvent, or
      approving as properly filed a petition seeking reorganization,
      arrangement, adjustment or composition of the Company under any applicable
      Federal or State bankruptcy or similar law, and such decree or order shall
      have continued undischarged and unstayed for a period of 90 days; or a
      decree or order of a court having jurisdiction in the premises for the
      appointment of a receiver, liquidator, trustee, assignee, sequestrator or
      similar official in bankruptcy or insolvency of the Company or of all or
      substantially all of its property, or for the winding up or liquidation of
      its affairs, shall have been entered, and such degree or order shall have
      continued undischarged and unstayed for a period of 90 days; or

            (g) The Company shall institute proceedings to be adjudicated a
      voluntary bankrupt, or shall consent to the filing of a bankruptcy
      proceeding against it, or shall file a petition or answer or consent
<PAGE>   47
                                       38

      seeking reorganization, arrangement, adjustment or composition under any
      applicable Federal or State bankruptcy or similar law, or shall consent to
      the filing of any such petition, or shall consent to the appointment of a
      receiver, liquidator, trustee, assignee, sequestrator or similar official
      in bankruptcy or insolvency of the Company or of all or substantially all
      of its property, or shall make an assignment for the benefit of creditors,
      or shall admit in writing its inability to pay its debts generally as they
      become due and its willingness to be adjudged a bankrupt, or corporate
      action shall be taken by the Company in furtherance of any of the
      aforesaid purposes.

     If an Event of Default described in clauses (a), (b) or (c) or established
pursuant to Section 2.02 with respect to Securities of any series at the time
outstanding occurs and is continuing, then and in each and every such case,
unless the principal of all the Securities of such series shall have already
become due and payable, either the Trustee or the holders of not less than 25
percent in aggregate principal amount of the Securities of such series then
outstanding hereunder, by notice in writing to the Company (and to the Trustee
if given by Security holders), may declare the principal amount (or such lesser
portion of the principal amount as may be specified in the terms of any
particular series of Securities as contemplated by Section 2.02, such series of
Securities being referred to herein as "Original Issue Discount Securities") of
all the Securities of such series and the interest, if any, accrued thereon to
be due and payable immediately, and upon any such declaration the same shall
become and shall be immediately due and payable, anything in this Indenture or
in the Securities of such series contained to the contrary notwithstanding. If
an Event of Default described in clauses (d), (e), (f) or (g) occurs and is
continuing, then and in each and every such case, unless the principal of all
the Securities shall have already become due and payable, either the Trustee or
the holders of not less than 25 percent in aggregate principal amount of all the
Securities then outstanding hereunder, by notice in writing to the Company (and
to the Trustee if given by Security holders), may declare the principal amount
(or, if any Securities are Original Issue Discount Securities, such portion of
the principal amount as may be specified in the terms thereof) of all the
Securities then outstanding hereunder and the interest, if any, accrued thereon
to be due and payable immediately and upon any such declaration the same shall
become and shall be immediately due and payable, anything in this Indenture or
in the Securities contained to the contrary notwithstanding.

<PAGE>   48
                                       39


      The foregoing provisions are, however, subject to the condition that if,
at any time after the principal (or, if the Securities of such series are
Original Issue Discount Securities, such portion of the principal amount as may
be specified in the terms of such series) of the Securities of any series (or of
all the Securities, as the case may be) shall have been so declared due and
payable, and before any judgment or decree for the payment of the moneys due
shall have been obtained or entered as hereinafter provided, the Company shall
pay or deposit with the Trustee a sum sufficient to pay all matured installments
of interest upon all the securities of such series (or of all the Securities, as
the case may be) and the principal of and premium, if any, on any and all
Securities of such series (or of all the Securities, as the case may be) which
shall have become due otherwise than by acceleration (with interest on overdue
installments of interest, to the extent that payment of such interest is
enforceable under applicable law, and on such principal and premium, if any, at
the rate of interest or Yield to Maturity (in the case of Original Issue
Discount Securities) specified in or determined in accordance with the
Securities of such series (or at the rates of interest or Yields to Maturity of
all the Securities, as the case may be), to the date of such payment or
deposit), and in addition thereto such further amount as shall be sufficient to
cover the costs and expenses of collection (including any claims arising in
respect of this Indenture for reasonable compensation to the Trustee, its
agents, attorneys and counsel, for any other expenses and liabilities incurred
and for advances made by the Trustee) except such costs and expenses as are a
result of negligence or bad faith on the part of the Trustee, and if any and all
defaults under the Indenture, other than the nonpayment of the principal of and
interest, if any, on the Securities of such series (or of all the Securities, as
the case may be) which shall have become due by acceleration, shall have been
waived by the holders of at least a majority in aggregate principal amount of
the then outstanding Securities of such series (or of all the Securities, as the
case may be) or remedied, then and in every such case the holders of at least a
majority in aggregate principal amount of the then outstanding Securities of
such series (or of all the Securities, as the case may be), by written notice to
the Company and to the Trustee, may rescind and annul such declaration and its
consequences, but no such rescission and annulment shall extend to or shall
affect any subsequent default or shall impair any right consequent thereon.

<PAGE>   49
                                       40


      For the purposes of this Indenture, if a portion of the principal of any
Original Issue Discount Securities shall have been accelerated and declared due
and payable pursuant to the provisions hereof, then, from and after such
declaration, unless such declaration has been rescinded and annulled, the
principal amount of such Original Issue Discount Securities shall be deemed, for
all purposes hereunder, to be such portion of the principal thereof as shall be
due and payable as a result of such acceleration, and payment of such portion of
the principal thereof as shall be due and payable as a result of such
acceleration, together with interest, if any, thereon and all other amounts
owing thereunder, shall constitute payment in full of such Original Issue
Discount Securities.

      SECTION 7.02. Collection of Indebtedness by Trustee; Trustee May Prove
Debt. The Company covenants that (i) in case default shall be made in the
payment of any installment of interest on any of the Securities of any series
when such interest shall have become due and payable, and such default shall
have continued for a period of 30 days or (ii) in case default shall be made in
the payment of the principal of or premium, if any, on any of the Securities of
any series when the same shall have become due and payable, whether upon
maturity or upon redemption or by declaration or otherwise, then upon written
demand of the Trustee, the Company will pay to the Trustee for the benefit of
the holders of the Securities of such series the whole amount that then shall
have become due and payable on all such Securities for principal or premium, if
any, or interest, if any, as the case may be (with interest upon the overdue
principal and to the extent that payment of such interest is enforceable under
applicable law, on overdue installments of interest at the same rate as the rate
of interest, if any, or Yield to Maturity (in the case of Original Issue
Discount Securities) specified in or determined in accordance with such
Securities of such series to be in effect on the date such interest was due, to
the date of such payment) and in addition thereto, such further amount as shall
be sufficient to cover the costs and expenses of collection including any claims
arising in respect of this Indenture for reasonable compensation to the Trustee,
its agents, attorneys and counsel, for any other expenses and liabilities
incurred and for advances by the Trustee) except such costs and expenses, as are
a result of negligence or bad faith on the part of the Trustee.

      Until such demand is made by the Trustee, the Company may pay the
principal of and premium, if any, and interest, if any, on the Securities

<PAGE>   50
                                       41

of any series to the registered holders, whether or not the Securities of
such series are overdue.

      In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any action or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceedings to judgment or final decree, and may enforce any such
judgment or final decree against the company or other obligor upon such
Securities and collect in the manner provided by law out of the property of the
Company or other obligor upon such Securities wherever situated the moneys
adjudged or decreed to be payable.

     In case there shall be pending proceedings for the bankruptcy or for the
reorganization of the Company or any other obligor upon the Securities of any
series under any applicable Federal or State law, or in case a receiver or
trustee shall have been appointed for the property of the Company or such other
obligor, or in case of any other proceedings relative to the Company or other
obligor upon the Securities of any series, or to the creditors or property of
the Company or such other obligor, the Trustee, irrespective of whether the
principal of the Securities of any series shall then be due and payable as
therein expressed or by declaration or otherwise and irrespective of whether the
Trustee shall have made any demand pursuant to the provisions of this Section
7.02, shall be entitled and empowered, by intervention in such proceedings or
otherwise, to file and prove a claim or claims for the whole amount of
principal, premium, if any, and interest (or if the Securities of such series
are Original Issue Discount Securities, such portion of the principal as may be
specified in or determined in accordance with the terms of such series) owing
and unpaid in respect of the Securities of any series, and to file such other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claims arising in respect of this Indenture for
reasonable compensation to the Trustee, its agents, attorneys and counsel, for
reimbursement of any other expenses and liabilities incurred and for advances
made by the Trustee) except such claims as are a result of negligence or bad
faith on the part of the Trustee, and the claims of the Security holders of any
series allowed in any proceedings relative to the Company or other obligor upon
the Securities, or to the creditors or property of the Company or such other
obligor, and to collect and receive any moneys or other property payable or
deliverable on any such claims,
<PAGE>   51
                                       42


and to distribute all amounts received with respect to the claims of the
Security holders of any series and of the Trustee on their behalf, and, unless
otherwise provided by law or applicable regulations, to vote on behalf of the
holders of Securities of any series in any election of a trustee in bankruptcy
or other person performing similar functions; provided, however, that nothing
herein shall be deemed to authorize the Trustee to authorize or consent to or
vote for or accept or adopt on behalf of any Security holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
of any series or the rights of any holder thereof, or to authorize the Trustee
to vote in respect of the claim of any Security holder, except, as aforesaid,
for the election of a trustee in bankruptcy or other person performing similar
functions. Any receiver, assignee or trustee in bankruptcy or reorganization or
similar proceeding or other person performing similar functions is hereby
authorized by each of the Security holders to make payments to the Trustee, and,
in the event that the Trustee shall consent to the making of payments directly
to the Security holders, to pay to the Trustee such amount as shall be
sufficient to cover the claims of the Trustee (including any claims arising in
respect of this Indenture for reasonable compensation to the Trustee, its
agents, attorneys and counsel, for any other expenses and liabilities incurred
and for advances made by the Trustee) except such claims as are a result of
negligence or bad faith on the part of the Trustee.

      All rights of action and of asserting claims under this Indenture, or
under any of the Securities may be enforced by the Trustee without the
possession of any of the Securities or the production thereof in any trial or
other proceedings relative thereto, and any such action or proceedings
instituted by the Trustee shall be brought in its own name as trustee of an
express trust, and any recovery of judgment (subject to the payment of such
expenses, disbursements and compensation, arising in respect of this Indenture,
of the Trustee, its agents and attorneys, as are not the result of negligence or
bad faith on the part of the Trustee) shall be for the ratable benefit of the
holders of the Securities in respect of which such action was taken.

      In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all holders of
Securities in respect of which such action was taken, and it shall not be
necessary to make any holder of such Securities party to any such proceedings.

<PAGE>   52
                                       43

      SECTION 7.03. Application of Proceeds. Any moneys collected by the Trustee
pursuant to this Article Seven in respect of any series shall be applied in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such moneys on account of principal, or premium, if any, or
interest, if any, upon the presentation of the several Securities in respect of
which such moneys have been collected and the notation thereon of payment if
partially paid, or the surrender thereof if fully paid:

            FIRST: To the payment of costs and expenses applicable to such
      series (including any claims arising in respect of this Indenture for
      reasonable compensation to the Trustee or any predecessor trustee, their
      agents, attorneys and counsel, for reimbursement of all expenses and
      liabilities incurred and for advances made by the Trustee and each
      predecessor trustee) except such costs and expenses as are as a result of
      negligence or bad faith on the part of the Trustee or of such predecessor
      trustee;

            SECOND: In case the principal of the Securities in respect of which
      such moneys have been collected shall not have become and be then due and
      payable, to the payment of interest, if any, on the Securities of such
      series in default in the order of the maturity of the installments of such
      interest, with interest (to the extent that payment of such interest is
      enforceable under applicable law and has been collected by the Trustee)
      upon the overdue installments of interest at the same rates as the rates
      of interest, if any, or Yield to Maturity (in the case of Original Issue
      Discount Securities) specified in or determined in accordance with the
      Securities, such payments to be made ratably to the persons entitled
      thereto, without discrimination or preference with respect to the holders
      of the same series of Securities;

            THIRD: In case the principal of any Securities in respect of which
      such moneys have been collected shall have become and shall be then due
      and payable, to the payment of the whole amount then owing and unpaid upon
      all the Securities of such series for principal, premium, if any, and
      interest, if any, with interest upon the overdue principal and (to the
      extent that payment of such interest is enforceable under applicable law
      and has been collected by the Trustee) upon overdue installments of
      interest at the same rates as the rates of interest, if any, or Yield to
      Maturity (in the case of Original Issue Discount

<PAGE>   53
                                       44

      Securities) specified in or determined in accordance with the Securities
      of such series; and, except as otherwise provided in Section 3.04, in case
      such moneys shall be insufficient to pay in full the whole amount so due
      and unpaid upon the Securities of such series, then to the payment of such
      principal, premium, if any, and interest, if any, without preference or
      priority of principal and premium, if any, over interest, if any, or of
      interest, if any, over principal and premium, if any, or of any
      installment of interest over any other installment of interest, or of any
      Security of such series over any other Security of such series, ratably to
      the aggregate of such principal, premium, if any, and accrued and unpaid
      interest, if any; and

            FOURTH: To the payment of the remainder, if any, to the Company or
      any other person lawfully entitled thereto.

      SECTION 7.04. Suits for Enforcement. In case of an Event of Default
hereunder the Trustee may in its discretion proceed to protect and enforce the
rights vested in it by this Indenture by such appropriate judicial proceedings
as the Trustee shall deem most effective to protect and enforce any of such
rights, either at law or in equity or in bankruptcy or otherwise, whether for
the specific enforcement of any covenants or agreements contained in this
Indenture or in aid of the exercise of any power granted in this Indenture or to
enforce any other legal or equitable right vested in the Trustee by this
Indenture or by law.

      SECTION 7.05. Restoration of Rights on Abandonment of Proceedings. In case
the Trustee shall have proceeded to enforce any right under this Indenture and
such proceedings shall have been discontinued or abandoned for any reason, or
shall have been determined adversely to the Trustee, then and in every such case
the Company and the Trustee shall be restored respectively to their former
positions and rights hereunder, and all rights, remedies and powers of the
Company, the Trustee and the Security holders shall continue as though no such
proceedings had been taken.

      SECTION 7.06. Limitations on Proceedings by Security Holders. No holder of
any Security of any series shall have any right by virtue of any provision of
this Indenture to institute any action or proceeding at law or in equity or in
bankruptcy or otherwise upon or with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
such holder previously shall have given to the

<PAGE>   54
                                       45


Trustee written notice of default and of the continuance thereof, as
hereinbefore provided, and unless also the holders of not less than 25% in
aggregate principal amount of the Securities of any series then outstanding, or,
in the case of any Event of Default described in clause (d), (e), (f) or (g) of
Section 7.01, 25% in aggregate principal amount of all Securities then
outstanding, shall have made written request upon the Trustee to institute such
action or proceedings in its own name as trustee hereunder and shall have
offered to the Trustee such reasonable indemnity as it may require against the
costs, expenses and liabilities to be incurred therein or thereby, and the
Trustee for 60 days after its receipt of such notice, request and offer of
indemnity shall have failed to institute any such action or proceeding and no
direction inconsistent with such written request shall have been given to the
Trustee pursuant to Section 7.09; it being understood and intended, and being
expressly covenanted by the taker and holder of every Security with every other
taker and holder and with the Trustee, that no one or more holders of Securities
of any series shall have any right in any manner whatever by virtue of any
provision of this Indenture to affect, disturb or prejudice the rights of any
other holder of Securities of that or any other series, or to obtain or seek to
obtain priority over or preference to any other such holder or to enforce any
right under this Indenture, except in the manner herein provided and for the
equal, ratable and common benefit of all holders of Securities of the applicable
series and except as may be provided in accordance with Section 3.04. For the
protection and enforcement of the provisions of this Section 7.06, each and
every Security holder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.

      SECTION 7.07. Unconditional Right of Security Holders To Sue for Principal
and Interest. Notwithstanding any other provision in this Indenture, the right
of any holder of any Security to receive payment of the principal of and
premium, if any, and interest, if any, on such Security on or after the
respective due dates expressed in such Security, or to institute suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such holder.

      SECTION 7.08. Powers and Remedies Cumulative; Delay or Omission Not Waiver
of Default. All powers and remedies given by this Article Seven to the Trustee
or to the Security holders shall, to the extent permitted by law, be deemed
cumulative and not exclusive of any thereof

<PAGE>   55
                                       46


or of any other powers and remedies available to the Trustee or the Securities
holders, by judicial proceedings or otherwise, to enforce the performance or
observance of the covenants and agreements contained in this Indenture.

      No delay or omission of the Trustee or of any holder of any of the
Securities to exercise any right or power accruing upon any Event of Default
occurring and continuing as aforesaid shall impair any such right or power or
shall be construed to be a waiver of any such Event of Default or an
acquiescence therein; and, subject to the provisions of Section 7.06, every
power and remedy given by this Article Seven or by law to the Trustee or to the
Security holders may be exercised from time to time, and as often as shall be
deemed expedient, by the Trustee or by the Security holders.

      SECTION 7.09. Control by Security Holders; Waiver of Default. The holders
of at least a majority in aggregate principal amount of the Securities of all
series affected (voting as one class) at the time outstanding 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 by this Indenture; provided, however, that such direction shall not
be otherwise than in accordance with law and the provisions of this Indenture.
Nothing in this Indenture shall impair the right of the Trustee in its
discretion to take any action deemed proper by the Trustee and which is not
inconsistent with such direction by Security holders; provided, however, that
(subject to the provisions of Section 8.01) the Trustee shall have the right to
decline to follow any such direction if the Trustee, being advised by counsel,
shall determine that the action or proceeding so directed may not lawfully be
taken or if the Trustee in good faith by its board of directors, the executive
committee, or a trust committee of directors or responsible officers of the
Trustee shall determine that the action or proceedings so directed would involve
the Trustee in personal liability. Prior to the declaration of the maturity of
Securities of any series (or all the Securities, as the case may be) as provided
in Section 7.01, the holders of at least a majority in aggregate principal
amount of the Securities of such series at the time outstanding may on behalf of
the holders of all Securities of such series waive any past default or Event of
Default described in clauses (a), (b) or (c) of Section 7.01, or any other Event
of Default for such series specified in the terms thereof as contemplated by
Section 2.02 (or, in the case of

<PAGE>   56
                                       47


any event specified in clause (d), (e), (f) or (g) of Section 7.01, the holders
of a majority in aggregate principal amount of all the Securities then
outstanding may waive any such default or Event of Default), its consequences,
except (unless theretofore remedied) a default in the payment of principal of or
premium, if any, or interest, if any, on any of the Securities or in respect of
a covenant or provision hereof which cannot be modified without the consent of
the holder of each Security affected. In the case of any such waiver, the
Company, the Trustee and the holders of the Securities shall be restored to
their former positions and rights hereunder, respectively; but no such waiver
shall extend to any subsequent or other default or impair any right consequent
thereon.

      SECTION 7.10. Trustee To Give Notice of Default; May Withhold Under
Certain Circumstances. The Trustee shall give to the Securities holders of a
series in the manner and to the extent provided in paragraph (c) of Section 6.04
with respect to reports pursuant to paragraph (a) of Section 6.04, notice of
each default hereunder with respect to the Securities of such series known to
the Trustee within 90 days after the occurrence thereof, unless such default
shall have been remedied before the giving of such notice; provided, however,
that except in the case of default in the payment of the principal of or
premium, if any, or interest, if any, on any of the Securities, or in the making
of any sinking fund payment, the Trustee shall be protected in withholding such
notice if and so long as the board of directors, the executive committee, or a
trust committee of directors or responsible officers of the Trustee in good
faith determines that the withholding of such notice is in the interest of the
Security holders. To the extent permitted by the Trust Indenture Act of 1939,
for purposes of this Section 7.10, the Trustee shall not be deemed to have
knowledge of a default (other than a default described in Sections 7.01(a) or
(b), provided the Trustee is acting as paying agent) unless a responsible
officer of the Trustee assigned to its corporate trust division shall, as such
officer, have actual knowledge thereof.

      The term "default," as used in this Section 7.10, shall mean the happening
of any of the Events of Default specified in Section 7.01, except that, for the
purposes of this Section 7.10 only, there shall be eliminated from the
specification of any such Event of Default any reference therein to (i) the
continuance of any default or of any failure upon the part of the Company to
act, or the continuance in force of any decree or order, for

<PAGE>   57
                                       48

any period of days therein specified and (ii) the giving of notice referred to
in paragraphs (d) and (e) of Section 7.01.

      SECTION 7.11. Right of Court To Require Filing of Undertaking To Pay
Costs. All parties to this Indenture agree, and each holder of any Security by
his acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, 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, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 7.11 shall not apply to any suit instituted by the
Trustee, to any suit instituted by any holder or group of holders of Securities
of a series holding in the aggregate more than 10% in aggregate principal amount
of the Securities of such series then outstanding (or, in the case of any suit
relating to or arising under clause (d), (e), (f) or (g) of Section 7.01, 10% in
aggregate principal amount of all Securities then outstanding) or to any suit
instituted by any Security holder for the enforcement of the payment of the
principal of or premium, if any, or interest, if any, on any Security on or
after the due date expressed in such Security.

                                  ARTICLE EIGHT

                             CONCERNING THE TRUSTEE

      SECTION 8.01. Duties and Responsibility of the Trustee: Prior to Default;
During Default. The Trustee, prior to the occurrence of an Event of Default and
after the remedy or waiver of all Events of Default which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Indenture. In case an Event of Default has occurred (which has not
been remedied or waived) 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 man would exercise or use under the
circumstances in the conduct of his own affairs.


<PAGE>   58
                                       49



      No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act,
or its own wilful misconduct, except that

            (a) Prior to the occurrence of an Event of Default and after the
      remedy or waiver of all such Events of Default which may have occurred:

                  (1) The duties and obligations of the Trustee shall be
            determined solely by the express provisions of this Indenture, and
            the Trustee shall not be liable except for the performance of such
            duties and obligations as are specifically set forth in this
            Indenture, and no implied covenants or obligations shall be read
            into this Indenture against the Trustee; and

                  (2) In the absence of bad faith on the part of the Trustee,
            the Trustee may conclusively rely, as to the truth of the statements
            and the correctness of the opinions expressed therein, upon any
            certificates or opinions furnished to the Trustee and conforming to
            the requirements of this Indenture; but 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 conform to the requirements of this Indenture;

            (b) The Trustee shall not be liable for any error of judgment made
      in good faith by a responsible officer of the Trustee, unless it shall be
      proved that the Trustee was negligent in ascertaining the pertinent facts;
      and

            (c) The Trustee shall not be liable with respect to any action taken
      or omitted to be taken by it in good faith in accordance with the
      direction of the holders of Securities pursuant to Section 7.09 relating
      to the time, method and place of conducting any proceeding for any remedy
      available to the Trustee, or exercising any trust or power conferred upon
      the Trustee, under this Indenture.

      None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal Financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or adequate indemnity against such liability is not
reasonably assured to it.

<PAGE>   59
                                       50



      SECTION 8.02. Certain Rights of the Trustee. Subject to Section 8.01:

            (a) The Trustee may rely and shall be protected in acting or
      refraining from acting upon any resolution, Officers' Certificate or any
      other certificate, statement, instrument, opinion, report, notice,
      request, consent, order, bond, security or other paper or document
      believed by it to be genuine and to have been signed or presented by the
      proper party or parties;

            (b) Any request, direction, order or demand of the Company mentioned
      herein shall be sufficiently evidenced by an Officers' Certificate (unless
      other evidence in respect thereof be herein specifically prescribed); and
      any resolution of the Board of Directors may be evidenced to the Trustee
      by a copy thereof certified by the secretary or an assistant secretary of
      the Company;

            (c) The Trustee may consult with counsel and any advice or Opinion
      of Counsel shall be full and complete authorization and protection in
      respect of any action taken, suffered or omitted to be taken by it
      hereunder in good faith and in accordance with such advice or Opinion of
      Counsel;

            (d) The Trustee shall be under no obligation to exercise any of the
      trusts or powers vested in it by this Indenture at the request, order or
      direction of any of the Security holders pursuant to the provisions of
      this Indenture, unless such Security holders shall have offered to the
      Trustee reasonable security or indemnity against the costs, expenses and
      liabilities which might be incurred therein or thereby;

            (e) The Trustee shall not be liable for any action taken or omitted
      by it in good faith and believed by it to be authorized or within the
      discretion, rights or powers conferred upon it by this Indenture;

            (f) Prior to the occurrence of an Event of Default and after the
      remedy or waiver of all Events of Default, the Trustee shall not be bound
      to make any investigation into the facts or matters stated in any
      resolution, certificate, statement, instrument, opinion, report, notice,
      request, consent, order, approval, appraisal, bond, security, or other
      paper or document unless requested in writing so to do by the holders of
      not less than a majority in aggregate principal amount of

<PAGE>   60
                                       51


      the Securities then outstanding of all series affected; provided, however,
      that, if the payment within a reasonable time to the Trustee of the costs,
      expenses or liabilities likely to be incurred by it in the making of such
      investigation is, in the opinion of the Trustee, not reasonably assured to
      the Trustee by the security afforded to it by the terms of this Indenture,
      the Trustee may require reasonable indemnity against such expenses or
      liabilities as a condition to so proceeding. The reasonable expenses of
      every such examination shall be paid by the Company or, if paid by the
      Trustee, shall be repaid by the Company upon demand; and

            (g) The Trustee may execute any of the trusts or powers hereunder or
      perform any duties hereunder either directly or by or through agents or
      attorneys not regularly in its employ and the Trustee shall not be
      responsible for any misconduct or negligence on the part of any such agent
      or attorney appointed with due care by it hereunder.

      SECTION 8.03. Recitals; Trustee Not Responsible for Disposition of
Securities or Application of Proceeds Thereof. All recitals contained herein and
in the Securities, except the Trustee's certificates of authentication, shall be
taken as the statements of the Company, and the Trustee assumes no
responsibility for the correctness of such recitals. The Trustee makes no
representation as to the validity or sufficiency of this Indenture or of the
Securities. The Trustee shall not be accountable for the use or application by
the Company of any of the Securities or of the proceeds thereof.

      SECTION 8.04. Trustee May Hold Securities. The Trustee or any paying
agent, Security registrar or other agent, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to the
provisions of Sections 8.08 and 8.13, may otherwise deal with, and collect
obligations owed to it by, the Company (and retain such collections for its own
account) with the same rights it would have if it were not the Trustee, paying
agent or Security registrar.

      SECTION 8.05. Moneys Held by Trustee. Subject to the provisions of Section
13.04, all moneys received by the Trustee or by any paying agent shall, until
used or applied as herein provided, be held in trust for the purposes for which
they were received, but need not be segregated from other funds except to the
extent required by law. Neither the

<PAGE>   61
                                       52


Trustee nor any paying agent shall be under any liability for interest on any
moneys received by it hereunder, except such as it shall agree to pay thereon.

      SECTION 8.06. Compensation of Trustee and Its Prior Claim. The Company
covenants and agrees to pay to the Trustee from time to time, and the Trustee
shall be entitled to, reasonable compensation (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
and, except as otherwise expressly provided, the Company covenants and agrees to
pay or reimburse the Trustee upon its written request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the reasonable expenses and disbursements of its
counsel and of all persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from negligence or bad faith on the part of
the Trustee. The Company also covenants to indemnify the Trustee for, and to
hold it harmless against, any loss, liability or expense incurred without
negligence or bad faith on the part of the Trustee, arising out of or in
connection with the acceptance or administration of this trust, including the
reasonable costs and expenses of defending itself against any claim of liability
in the premises. The obligations of the Company under this Section 8.06 to
compensate and indemnify the Trustee and to pay or reimburse the Trustee for
expenses, disbursements and advances shall constitute additional indebtedness
hereunder and shall survive the satisfaction and discharge of this Indenture.
Such additional indebtedness shall be secured by a claim prior to that of the
Securities upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the benefit of the holders of particular
Securities.

      SECTION 8.07. Right of Trustee To Rely on Officers' Certificate. Subject
to Section 8.01, whenever in the administration of the trusts of this Indenture
the Trustee shall deem it necessary or desirable that a matter be proved or
established prior to taking or suffering or omitting any action hereunder, such
matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of negligence or bad faith on the part of the
Trustee, be deemed to be conclusively proved and established by an Officers'
Certificates delivered to the Trustee and such certificate, in the absence of
negligence or bad faith on the part of the Trustee, shall be full warrant to the
Trustee for any action taken,

<PAGE>   62
                                       53


suffered or omitted by it under the provisions of this Indenture upon the faith
thereof.

      SECTION 8.08. Qualification of Trustee; Resignation of Trustee With
Conflicting Interests. (a) If the Trustee has or shall acquire any conflicting
interest with respect to Securities of any series, as defined in this Section
8.08, it shall, within 90 days after ascertaining that it has such conflicting
interest, either eliminate such conflicting interest or resign in the manner and
with the effect specified in Section 8.10.

      (b) In the event that the Trustee shall fail to comply with the provisions
of paragraph (a) of this Section 8.08, the Trustee shall, within 10 days after
the expiration of such 90 day period, transmit notice of such failure to the
Security holders in the manner and to the extent provided in paragraph (c) of
Section 6.04 with respect to reports pursuant to paragraph (a) of such Section
6.04.

      (c) For the purposes of this Section 8.08 the Trustee shall be deemed to
have a conflicting interest with respect to Securities of any series if

            (1) The Trustee is trustee under this Indenture with respect to the
      outstanding Securities of any other series or is a trustee under another
      indenture under which any other securities, or certificates of interest or
      participation in any other securities, of the Company are outstanding,
      unless such other indenture is a collateral trust indenture under which
      the only collateral consists of Securities issued under this Indenture;
      provided, however, that there shall be excluded from the operations of
      this paragraph, this Indenture with respect to the Securities of any other
      series and any other indenture or indentures under which other securities,
      or certificates of interest or participation in other securities, of the
      Company are outstanding if

                  (i) this Indenture, with respect to the Securities of such
            series, and this Indenture with respect to such other series and
            such other indenture or indentures are wholly unsecured, and such
            other indenture or indentures are hereafter qualified under the
            Trust Indenture Act of 1939, unless the Commission shall have found
            and declared by order pursuant to Section 305(b) or Section 307(c)
            of said Trust Indenture Act of 1939 that differences exist between
            the provisions of this Indenture with respect to Securities of such
            series and one or more other series, or the provisions of this
            Indenture and the provisions of such other indenture or indentures
            which are so likely to involve a material

<PAGE>   63
                                       54

            conflict of interest as to make it necessary in the public interest
            or for the protection of investors to disqualify the Trustee from
            acting as such under this Indenture or such other indenture or
            indentures, or

                  (ii) the Company shall have sustained the burden of proving,
            on application to the Commission and after opportunity for hearing
            thereon, that trusteeship under this Indenture and such other
            indenture or indentures is not so likely to involve a material
            conflict of interest as to make it necessary in the public interest
            or for the protection of investors to disqualify the Trustee from
            acting as such under one of such indentures;

            (2) The Trustee or any of its directors or executive officers is an
      obligor upon Securities of any series or an underwriter for the Company;

            (3) The Trustee directly or indirectly controls or is directly or
      indirectly controlled by or is under direct or indirect common control
      with the Company or an underwriter for the Company.

            (4) The Trustee or any of its directors or executive officers is a
      director, officer, partner, employee, appointee, or representative of the
      Company, or of an underwriter (other than the Trustee itself) for the
      Company who is currently engaged in the business of underwriting, except
      that (i) one individual may be a director or an executive officer, or
      both, of the Trustee and a director or an executive officer, or both, of
      the Company but may not be at the same time an executive officer of both
      the Trustee and the Company; (ii) if and so long as the number of
      directors of the Trustee in office is more than nine, one additional
      individual may be a director or an executive officer, or both, of the
      Trustee and a director of the Company; and (iii) the Trustee may be
      designated by the Company or by any underwriter for the Company to act in
      the capacity of transfer agent, registrar, custodian, paying agent, fiscal
      agent, escrow agent, or depositary, or in any other similar capacity, or,
      subject to the provisions of clause (1) of this paragraph (c) of Section
      8.08, to act as trustee, whether under an indenture or otherwise;

            (5) 10% or more of the voting securities of the Trustee is
      beneficially owned either by the Company or by any director, partner or
      executive officer thereof, or 20% or more of such voting securities

<PAGE>   64
                                       55


      is beneficially owned, collectively, by any two or more of such persons;
      or 10% or more of the voting securities of the Trustee is beneficially
      owned either by an underwriter for the Company or by any director,
      partner, or executive officer thereof, or is beneficially owned,
      collectively, by any two or more such persons;

            (6) The Trustee is the beneficial owner of, or holds as collateral
      security for an obligation which is in default, (i) 5% or more of the
      voting securities or 10% or more of any other class of security of the
      Company, not including the Securities and securities issued under any
      other indenture under which the Trustee is also trustee, or (ii) 10% or
      more of any class of security of an underwriter for the Company;

            (7) The Trustee is the beneficial owner of, or holds as collateral
      security for an obligation which is in default, 5% or more of the voting
      securities of any person who, to the knowledge of the Trustee, owns 10% or
      more of the voting securities of, or controls directly or indirectly or is
      under direct or indirect common control with, the Company;

            (8) The Trustee is the beneficial owner of, or holds as collateral
      security for an obligation which is in default, 10% or more of any class
      of security of any person who, to the knowledge of the Trustee, owns 50%
      or more of the voting securities of the Company; or

            (9) The Trustee owns on May 15 in any calendar year, in the capacity
      of executor, administrator, testamentary or inter vivos trustee, guardian,
      committee or conservator, or in any other similar capacity, an aggregate
      of 25% or more of the voting securities, or of any class of security, of
      any person, the beneficial ownership of a specified percentage of which
      would have constituted a conflicting interest under clauses (6), (7) or
      (8) of this paragraph (c) of Section 8.08. As to any such securities of
      which the Trustee acquired ownership through becoming executor,
      administrator, or testamentary trustee of an estate which included them,
      the provisions of the preceding sentence shall not apply, for a period of
      two years from the date of such acquisition, to the extent that such
      securities included in such estate do not exceed 25% of such voting
      securities or 25% of any such class of security. Promptly after May 15 in
      each calendar year, the Trustee shall make a check of its holdings of such
      securities in any of the above-mentioned capacities as of such May 15. If
      the Company
<PAGE>   65
                                       56


      fails to make payment in full of principal of or interest on any of the
      Securities when and as the same becomes due and payable, and such failure
      continues for 30 days thereafter, the Trustee shall make a prompt check of
      its holdings of such securities in any of the above-mentioned capacities
      as of the date of the expiration of such 30-day period, and after such
      date, notwithstanding the foregoing provisions of this paragraph, all such
      securities so held by the Trustee, with sole or joint control over such
      securities vested in it, shall, but only so long as such failure shall
      continue, be considered as though beneficially owned by the Trustee for
      the purposes of clauses (6), (7) or (8) of this paragraph (c) of Section
      8.08.

      The specification of percentages in clauses (5) to (9) inclusive of this
Paragraph (c) of Section 8.08 shall not be construed as indicating that the
ownership of such percentages of the securities of a person is or is not
necessary or sufficient to constitute direct or indirect control for the
purposes of clauses (3) or (7) of this paragraph (c) of Section 8.08.

      For the purposes of clauses (6), (7), (8) and (9) only of this paragraph
(c) of Section 8.08, (i) the terms "security" and "securities" shall include
only such securities as are generally known as corporate securities, but shall
not include any note or other evidence of indebtedness issued to evidence an
obligation to repay moneys lent to a person by one or more banks, trust
companies, or banking firms, or any certificate of interest or participation in
any such note or evidence of indebtedness; (ii) an obligation shall be deemed to
be in default when a default in payment of principal shall have continued for 30
days or more and shall not have been remedied; and (iii) the Trustee shall not
be deemed to be the owner or holder of (A) any security which it holds as
collateral security, as trustee or otherwise, for an obligation which is not in
default as defined in clause (ii) above, or (B) any security which it holds as
collateral security under this Indenture, irrespective of any default hereunder,
or (C) any security which it holds as agent for collection, or as custodian,
escrow agent, or depositary, or in any similar representative capacity.

      Except as provided above, the word "security" or "securities" as used in
this Indenture shall mean any note, stock, treasury stock, bond, debenture,
evidence of indebtedness, certificate of interest or participation in any
profit-sharing agreement, collateral trust certificate, preorganization
certificate or subscription, transferable share, investment contract, voting
trust certificate, certificate of deposit for a security, fractional undivided

<PAGE>   66
                                       57


interest in oil, gas or other mineral rights, or, in general, any interest or
instrument commonly known as a security," or any certificate of interest or
participation in, temporary or interim certificate for, receipt for, guarantee
of, or warrant or right to subscribe to or purchase, any of the foregoing.

            (d) For purposes of this Section 8.08:

                  (1) The term "underwriter" when used with reference to the
            Company shall mean every person who, within three years prior to the
            time as of which the determination is made, has purchased from the
            Company with a view to, or has offered or sold for the Company in
            connection with, the distribution of any security of the Company
            outstanding at such time, or has participated or has had a direct or
            indirect participation in any such undertaking, or has participated
            or has had a participation in the direct or indirect underwriting of
            any such undertaking, but such term shall not include a person whose
            interest was limited to a commission from an underwriter or dealer
            not in excess of the usual and customary distributors' or sellers'
            commission;

                  (2) The term "director" shall mean any director of a
            corporation or any individual performing similar functions with
            respect to any organization whether incorporated or unincorporated;

                  (3) The term "person" shall mean an individual, a corporation,
            a partnership, an association, a joint-stock company, a trust, an
            unincorporated organization, or a government or political
            subdivision thereof. As used in this paragraph (d) of Section 8.08,
            the term "trust" shall include only a trust where the interest or
            interests of the beneficiary or beneficiaries are evidenced by a
            security;

                  (4) The term "voting security" shall mean any security
            presently entitling the owner or holder thereof to vote in the
            direction or management of the affairs of a person, or any security
            issued under or pursuant to any trust, agreement or arrangement
            whereby a trustee or trustees or agent or agents for the owner or
            holder of such security are presently entitled to vote in the
            direction or management of the affairs of a person;

                  (5) The term "Company" shall mean any obligor upon the
            Securities; and

<PAGE>   67
                                       58



                  (6) The term "executive officer" shall mean the president,
            every vice president, every trust officer, the cashier, the
            secretary, and the treasurer of a corporation, and any individual
            customarily performing similar functions with respect to any
            organization whether incorporated or unincorporated, but shall not
            include the chairman of the board of directors.

            (e) The percentages of voting securities and other securities
      specified in this Section 8.08 shall be calculated in accordance with the
      following provisions:

                  (1) A specified percentage of the voting securities of the
            Trustee, the Company or any other person referred to in this Section
            8.08 (each of whom is referred to as a "person" in this paragraph
            (e)) means such amount of the outstanding voting securities of such
            person as entities the holder or holders thereof to cast such
            specified percentage of the aggregate votes which the holders of all
            the outstanding voting securities of such person are entitled to
            cast in the direction or management of the affairs of such person;

                  (2) A specified percentage of a class of securities of a
            person means such percentage of the aggregate amount of securities
            of the class outstanding;

                  (3) The term "amount," when used in regard to securities,
            means the principal amount if relating to evidences of indebtedness,
            the number of shares if relating to capital shares, and the number
            of units if relating to any other kind of security;

                  (4) The term "outstanding" means issued and not held by or for
            the account of the issuer. The following securities shall not be
            deemed outstanding within the meaning of this definition:

                        (i) securities of an issuer held in a sinking fund
                  relating to securities of the issuer of the same class;

                        (ii) securities of an issuer held in a sinking fund
                  relating to another class of securities of the issuer, if the
                  obligation evidenced by such other class of securities is not
                  in default as to principal or interest or otherwise;

                        (iii) securities pledged by the issuer thereof as
                  security for an obligation of the issuer not in default as to
                  principal or interest or otherwise; and
<PAGE>   68
                                       59


                        (iv) securities held in escrow if placed in escrow by
                  the issuer thereof;

            Provided, however, that any voting securities of an issuer shall be
            deemed outstanding if any person other than the issuer is entitled
            to exercise the voting rights thereof; and

                  (5) a security shall be deemed to be of the same class as
            another security if both securities confer upon the holder or
            holders thereof substantially the same rights and privileges;
            provided, however, that, in the case of secured evidences of
            indebtedness, all of which are issued under a single indenture,
            differences in the interest rates or maturity dates of various
            series thereof shall not be deemed sufficient to constitute such
            series different classes and provided, further, that, in the case of
            unsecured evidences of indebtedness, differences in the interest
            rates or maturity dates thereof shall not be deemed sufficient to
            constitute them securities of different classes, whether or not they
            are issued under a single indenture.

      SECTION 8.09. Persons Eligible for Appointment as Trustee. The Trustee for
each series of Securities hereunder shall at all times be a corporation
organized and doing business under the laws of the United States of America or
of any State thereof, or of the District of Columbia, shall have a combined
capital and surplus of at least $100,000,000, shall be authorized under such
laws to exercise corporate trust powers and shall be subject to supervision or
examination by Federal, State or District of Columbia authority, if there be
such a corporation willing to act upon reasonable and customary terms and
conditions. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then for the purposes of this Section 8.09, the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 8.09, the Trustee shall resign
immediately in the manner and with the effect specified in Section 8.10.

      SECTION 8.10. Resignation and Removal; Appointment of Successor Trustee.
(a) The Trustee may at any time resign with respect to one or more or all series
of Securities by giving written notice of resignation to the Company and to
holders of Securities of the applicable series at their

<PAGE>   69
                                       60


addresses as they shall appear on the register. Upon receiving such notice of
resignation, the Company shall promptly appoint a successor trustee by written
instrument in duplicate, executed by order of the Board of Directors, or
pursuant to a written instrument executed by one or more duly authorized
officers of the Company, one copy of which instrument shall be given to the
resigning Trustee and one copy to the successor trustee. If no successor trustee
shall have been so appointed and have accepted appointment within 30 days after
the giving of such notice of resignation, the resigning trustee may petition any
court of competent jurisdiction for the appointment of a successor trustee, or
any Security holder who has been a bona fide holder of a Security of the
applicable series for at least six months may, subject to the provisions of
Section 7.1 1, on behalf of himself and all others similarly situated, petition
any such court for the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and prescribe,
appoint a successor trustee.

            In case at any time any of the following shall occur:

            (1) The Trustee shall fail to comply with the provisions of
      Paragraph (a) of Section 8.08 with respect to any series of Securities
      after written request therefor by the Company or by any Security holder
      who has been a bona fide holder of a Security of such series for at least
      six months; or

            (2) The Trustee shall cease to be eligible in accordance with the
      provisions of Section 8.09 and shall fail to resign after written request
      therefor by the Company or by any such Security holder; or

            (3) The Trustee shall become incapable of acting, or shall be
      adjudged a bankrupt or insolvent, or a receiver or similar official of the
      Trustee or of its property shall be appointed, or any public officer shall
      take charge or control of the Trustee or of its property or affairs for
      the purpose of rehabilitation, conservation or liquidation;

      then, in any such case, the Company may remove the Trustee with respect to
the applicable series and appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors or pursuant to a written
instrument executed by one or more duly authorized officers of the Company, one
copy of which instrument shall be delivered to the Trustee so removed and one
copy to the successor trustee, or, subject to the provisions of Section 7.11,
any Security holder who has been a bona fide holder of a Security of such series
for at least six months may on behalf of himself and all others similarly
situated, petition any court of 

<PAGE>   70
                                       61


competent jurisdiction for the removal of the Trustee and the appointment of a
successor trustee. Such court may thereupon, after such notice, if any, as it
may deem proper and prescribe, remove the Trustee and appoint a successor
trustee.

      (c) The holders of at least a majority in aggregate principal amount of
the Securities of one or more series (each series voting as a class) or all
series at the time outstanding (voting as one class) may at any time remove the
Trustee with respect to the applicable series or all series, as the case may be,
and appoint a successor trustee by delivering to the Trustee so removed, to the
successor trustee so appointed and to the Company the evidence provided for in
Section 9.01 of the action in that regard taken by the Security holders.

      (d) Any resignation or removal of the Trustee with respect to any series
and any appointment of a successor trustee pursuant to any of the provisions of
this Section 8.10 shall become effective upon acceptance of appointment by the
successor trustee as provided in Section 8.11.

      SECTION 8.11. Acceptance of Appointment by Successor Trustee. Any
successor trustee appointed as provided in Section 8.10 shall execute,
acknowledge and deliver to the Company and to its predecessor trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor trustee shall become effective and such successor
trustee, without any further act, deed or conveyance, shall become vested with
all rights, powers, duties and obligations of its predecessor hereunder, with
like effect as if originally named as trustee herein; but, nevertheless, on the
written request of the Company or of the successor trustee, upon payment of its
charges then unpaid, the trustee ceasing to act shall, subject to Section 13.04,
pay over to the successor trustee all moneys at the time held by it hereunder
and shall execute and deliver an instrument transferring to such successor
trustee all such rights, powers, duties and obligations. Upon request of any
such successor trustee, the Company shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor
trustee all such rights and powers. Any trustee ceasing to act shall,
nevertheless, retain a prior claim upon all property or funds held or collected
by such trustee to secure any amounts then due it pursuant to the provisions of
Section 8.06.

      No successor trustee with respect to any series of Securities shall accept
appointment as provided in this Section 8.11 unless at the time of 
<PAGE>   71
                                       62

such acceptance such successor trustee shall not have any conflicting interest
as set forth in Section 8.08 and shall be eligible under the provisions of
Section 8.09.

      In case of the appointment hereunder of a successor trustee with respect
to Securities of one or more (but not all) series, the Company, the predecessor
trustee and each successor trustee with respect to the Securities of any
applicable series shall execute and deliver an indenture supplemental hereto
which shall contain such provisions as shall be deemed necessary or desirable to
confirm that all the rights, powers, trusts and duties of the predecessor
trustee with respect to the Securities of any series as to which the predecessor
trustee is not retiring shall continue to be vested in the predecessor trustee,
and shall 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, it being understood that nothing herein or
in such supplemental indenture shall constitute such trustees co-trustees of the
same trust and that each such trustee shall be trustee of a trust or trusts
hereunder separate and apart from any trust or trusts hereunder administered by
any other such trustee.

      Upon acceptance of appointment by a successor trustee as provided in this
Section 8.11, the Company shall give notice thereof to the holders of Securities
of any applicable series at their addresses as they shall appear on the
register. If the Company fails to give such notice within 15 days after
acceptance of appointment by the successor trustee, the successor trustee shall
cause such notice to be given at the expense of the Company.

      SECTION 8.12. Merger, Conversion or Consolidation of Trustee. Any
corporation into which the Trustee may be merged or converted or with which it
may be consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation
succeeding to the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, provided that such corporation shall not
have any conflicting interest as set forth in Section 8.08 and shall be eligible
under the provisions of Section 8.09, without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding.

<PAGE>   72
                                       63

      In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and deliver such
Securities so authenticated; and in case at that time any of the Securities
shall not have been authenticated, any successor to the Trustee may authenticate
such Securities either in the name of any predecessor hereunder or in the name
of the successor Trustee; and in all such cases such certificate shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have; provided, however, that the
right to adopt the certificate of authentication of any predecessor Trustee or
to authenticate Securities in the name of any predecessor Trustee shall apply
only to its successors by merger, conversion or consolidation.

      SECTION 8.13. Preferential Collection of Claims Against the Company. (a)
Subject to the provisions of paragraph (b) of this Section 8.13, if the Trustee
shall be or shall become a creditor, directly or indirectly, secured or
unsecured, of the Company within four months prior to a default, as defined in
paragraph (c) of this Section 8.13, or subsequent to such a default, then,
unless and until such default shall be cured, the Trustee shall set apart and
hold in a special account for the benefit of the Trustee individually, the
holders of the Securities and the holders of other indenture securities (as
defined in paragraph (c) of this Section 8.13):

            (1) An amount equal to any and all reductions in the amount due and
      owing upon any claim as such creditor in respect of principal or interest,
      effected after the beginning of such four months' period and valid as
      against the Company and its other creditors, except any such reduction
      resulting from the receipt or disposition of any property described in
      clause (2) of this paragraph (a) of this Section 8.13, or from the
      exercise of any right of set-off which the Trustee could have exercised if
      a petition in bankruptcy had been filed by or against the Company upon the
      date of such default; and

            (2) All property received by the Trustee in respect of any claim as
      such creditor, either as security therefor, or in satisfaction or
      composition thereof, or otherwise, after the beginning of such four
      months' period, or an amount equal to the proceeds of any such property,
      if disposed of, subject, however, to the rights, if any, of the Company
      and its other creditors in such property or such proceeds.

<PAGE>   73
                                       64

Nothing herein contained, however, shall affect the right of the Trustee:

            (A) to retain for its own account (i) payments made on account of
      any such claim by any person (other than the Company) who is liable
      thereon, and (ii) the proceeds of the bona fide sale of any such claim by
      the Trustee to a third person, and (iii) distributions made in cash,
      securities, or other property in respect of claims filed against the
      Company in bankruptcy or receivership or in proceedings for reorganization
      pursuant to the Bankruptcy Act or applicable State law;

            (B) to realize, for its own account, upon any property held by it as
      security for any such claim, if such property was so held prior to the
      beginning of such four months' period;

            (C) to realize, for its own account, but only to the extent of the
      claim hereinafter mentioned, upon any property held by it as security for
      any such claim, if such claim was created after the beginning of such four
      months' period and such property was received as security therefor
      simultaneously with the creation thereof, and if the Trustee shall sustain
      the burden of proving that at the time such property was so received the
      Trustee had no reasonable cause to believe that a default as defined in
      paragraph (c) of this Section 8.13 would occur within four months; or

            (D) to receive payment on any claim referred to in clause (B) or (C)
      above, against the release of any property held as security for such claim
      as provided in such clause (B) or (C), as the case may be, to the extent
      of the fair value of such property.

            For the purposes of clauses (B), (C) and (D) above, property
      substituted after the beginning of such four months' period for property
      held as security at the time of such substitution shall, to the extent of
      the fair value of the property released, have the same status as the
      property released, and, to the extent that any claim referred to in any of
      such paragraphs is created in renewal of or in substitution for or for the
      purpose of repaying or refunding any pre-existing claim of the Trustee as
      such creditor, such claim shall have the same status as such pre-existing
      claim.

            If the Trustee shall be required to account, the funds and property
      held in such special account and the proceeds thereof shall be apportioned
      between the Trustee, the Security holders and the holders of other
      indenture securities in such manner that the Trustee, the Security holders
      and the holders of other indenture securities
<PAGE>   74
                                       65

      realize, as a result of payments from such special account and payments of
      dividends on claims filed against the Company in bankruptcy or
      receivership or in proceedings for reorganization pursuant to the
      Bankruptcy Act or applicable State law, the same percentage of their
      respective claims, figured before crediting to the claim of the Trustee
      anything on account of the receipt by it from the Company of the funds and
      property in such special account and before crediting to the respective
      claims of the Trustee, the Security holders and the holders of other
      indenture securities dividends on claims filed against the Company in
      bankruptcy or receivership or in proceedings for reorganization pursuant
      to the Bankruptcy Act or applicable State law, but after crediting thereon
      receipts on account of the indebtedness represented by their respective
      claims from all sources other than from such dividends and from the funds
      and property so held in such special account. As used in this paragraph,
      with respect to any claim, the term "dividends" shall include. any
      distribution with respect to such claim, in bankruptcy or receivership or
      in proceedings for reorganization pursuant to the Bankruptcy Act or
      applicable State law, whether such distribution is made in cash,
      securities or other property, but shall not include any such distribution
      with respect to the secured portion, if any, of such claim. The court in
      which such bankruptcy, receivership or proceeding for reorganization is
      pending shall have jurisdiction (i) to apportion between the Trustee, the
      Security holders and the holders of other indenture securities, in
      accordance with the provisions of this paragraph, the funds and property
      held in such special account and the proceeds thereof, or (ii) in lieu of
      such apportionment, in whole or in part, to give to the provisions of this
      paragraph due consideration in determining the fairness of the
      distributions to be made to the Trustee, the Security holders and the
      holders of other indenture securities with respect to their respective
      claims, in which event it shall not be necessary to liquidate or to
      appraise the value of any securities or other property held in such
      special account or as security for any such claim, or to make a specific
      allocation of such distributions as between the secured and unsecured
      portions of such claims, or otherwise to apply the provisions of this
      paragraph as a mathematical formula.

            Any Trustee who has resigned or been removed after the beginning of
      such four months' period shall be subject to the provisions of this
      paragraph (a) of Section 8.13 as though such resignation or 
<PAGE>   75
                                       66

      removal had not occurred. If any Trustee has resigned or been removed
      prior to the beginning of such four months' period, it shall be subject to
      the provisions of this paragraph (a) of Section 8.13 if and only if the
      following conditions exist:

            (i) the receipt of property or reduction of claim which would have
      given rise to the obligation to account, if such Trustee had continued as
      trustee, occurred after the beginning of such four months' period; and

            (ii) such receipt of property or reduction of claim occurred within
      four months after such resignation or removal.

      (b) There shall be excluded from the operation of paragraph (a) of this
Section 8.13 a creditor relationship arising from

            (1) The ownership or acquisition of securities issued under any
      indenture, or any security or securities having a maturity of one year or
      more at the time of acquisition by the Trustee;

            (2) Advances authorized by a receivership or bankruptcy court of
      competent jurisdiction or by this Indenture for the purpose of preserving
      any property which shall at any time be subject to the lien of this
      Indenture or of discharging tax liens or other prior liens or encumbrances
      thereon, if notice of such advance and of the circumstances surrounding
      the making thereof is given to the Security holders at the time and in the
      manner provided in this Indenture;

            (3) Disbursements made in the ordinary course of business in the
      capacity of trustee under an indenture, transfer agent, registrar,
      custodian, paying agent, fiscal agent or depositary, or other similar
      capacity;

            (4) An indebtedness created as a result of services rendered or
      premises rented or an indebtedness created as a result Of goods or
      securities sold in a cash transaction as defined in paragraph (c) of this
      Section 8.13;

            (5) The ownership of stock or of other securities of a corporation
      organized under the provisions of Section 25(a) of the Federal Reserve
      Act, as amended, which is directly or indirectly a creditor of the
      Company; or

            (6) The acquisition, ownership, acceptance or negotiation of any
      drafts, bills of exchange, acceptance or obligations which 
<PAGE>   76
                                       67


      fall within the classification of self-liquidating paper as defined in
      paragraph (c) of this Section 8.13.

      (c) As used in this Section 8.13:

            (1) The term "default" shall mean any failure to make payment in
      full of the principal of or interest upon any of the Securities or upon
      the other indenture securities when and as such principal or interest
      becomes due and payable;

            (2) The term "other indenture securities" shall mean securities upon
      which the Company is an obligor (as defined in the Trust Indenture Act of
      1939) outstanding under any other indenture (i) under which the Trustee is
      also trustee, (ii) which contains provisions substantially similar to the
      provisions of paragraph (a) of this Section 8.13, and (iii) under which a
      default exists at the time of the apportionment of the funds and property
      held in said special account;

            (3) The term "cash transaction" shall mean any transaction in which
      full payment for goods or securities sold is made within seven days after
      delivery of the goods or securities in currency or in checks or other
      orders drawn upon banks or bankers and payable upon demand;

            (4) The term "self-liquidating paper" shall mean any draft, bill of
      exchange, acceptance or obligation which is made, drawn, negotiated or
      incurred by the Company for the purpose of financing the purchase,
      processing, manufacture, shipment, storage or sale of goods, wares or
      merchandise and which is secured by documents evidencing title to,
      possession of, or a lien upon the goods, wares or merchandise or the
      receivables or proceeds arising from the sale of the goods, wares or
      merchandise previously constituting the security; provided, however, that
      the security is received by the Trustee simultaneously with the creation
      of the creditor relationship with the Company arising from the making,
      drawing, negotiating or incurring of the draft, bill of exchange,
      acceptance or obligation; and

            (5) The term "Company" shall mean any obligor upon the Securities.

      SECTION 8.14. Limitation on Role of Trustee in Participating in
Solicitation of Consents, Authorizations, Etc. Subject to the provisions
<PAGE>   77
                                       68

of paragraph (b) of Section 6.02 and the provisions of Section 8.01, if the
Company or any other person (other than the Trustee) shall wish to communicate
with holders of the Securities to solicit or obtain from them any consent,
amendment, authorization, proxy, waiver, approval of a plan of reorganization,
arrangement, adjustment or composition or other action each of which acts shall
herein be called a "Security holder Action"), the Trustee shall have no duty to
participate in such communication or solicitation or the processing of responses
in any manner except (a) to furnish the rules and regulations and to perform the
functions referred to in Sections 9.02, 10.02 and 10.05 and (b) to receive (i)
instruments evidencing the Security holder Action together with (ii) the
Officers' Certificate and Opinion of Counsel referred to below. The Company
hereby covenants that any and all communications and solicitations distributed
by it in connection with any Security holder Action will comply in all material
respects with applicable law, including without limitation laws concerning
adequacy of disclosure. The Trustee shall have no responsibility for the
accuracy or completeness of any materials circulated to solicit any Security
holder Action nor for any related communications nor for the compliance thereof
with applicable law. No Security holder Action shall become effective until the
Trustee shall have received from the Company or other person who solicited the
Security holder Action (a) the instruments evidencing such Action as provided in
Section 9.01, and (b) (i) (in the case of Security holder Action solicited by
the Company or the representative of the Company's estate if the Company is the
debtor in any bankruptcy or other insolvency proceeding) an Officers'
Certificate and (ii) (in all cases) an Opinion of Counsel, each specifying the
Security holder Action taken and stating that such Security holder Action has
been duly and validly taken in compliance with this Indenture in all material
respects. Such Officers' Certificate, if any, shall also certify that, after
giving effect to such Security holder Action, no Event of Default would have
occurred and would be continuing or, if continuing, would not have been waived.


                                  ARTICLE NINE

                         CONCERNING THE SECURITY HOLDERS

      SECTION 9.01. Evidence of Action Taken by Security Holders. Whenever in
this Indenture it is provided that the holders of a specified percentage in
aggregate principal amount of the Securities of any or all series may take any
action (including the making of any demand or
<PAGE>   78
                                       69

request, the giving of any notice, consent or waiver or the taking of any other
action) the fact that at the time of taking any such action the holders of such
specified percentage have joined therein may be evidenced (i) by any instrument
or any number of instruments of similar tenor executed by Security holders in
person or by agent or proxy appointed in writing, or (ii) by the record of the
holders of Securities voting in favor thereof at any meeting of Security holders
duly called and held in accordance with the provisions of Article Ten, or (iii)
by a combination of such instrument or instruments and any such record of such a
meeting of Security holders.

      SECTION 9.02. Proof of Execution of Instruments and of Holding of
Securities. Subject to the provisions of Section 8.01, 8.02, 9.01 and 10.05,
proof of the execution of any instrument by a Security holder or his agent or
proxy and proof of the holding by any person of any of the Securities shall be
sufficient if made in accordance with such reasonable rules and regulations as
may be prescribed by the Trustee or in such manner as shall be satisfactory to
the Trustee. The ownership of Securities shall be proven by the register or by a
certificate of the Security registrar.

      The record of any Security holders' meeting shall be proved in the manner
provided in Section 10.06.

      SECTION 9.03. Holders of Securities May Be Treated as Owners. Prior to due
presentation of any Security for registration of transfer, the Company, the
Trustee, any paying agent, any conversion agent and any Security registrar may
deem and treat the person in whose name such Security shall be registered in the
register as the absolute owner of such Security (whether or not such Security
shall be overdue and notwithstanding any notation of ownership or other writing
thereon made by anyone) for the purpose of receiving payment of or on account of
the principal of, premium, if any, on and (subject to the provisions of Section
2.10) interest, if any, on such Security and for all other purposes; and neither
the Company nor the Trustee nor any paying agent nor any conversion agent nor
any Security registrar shall be affected by any notice to the contrary. All such
payments so made to any such registered holder, or upon his order, shall be
valid and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability for moneys payable upon any such Security.

<PAGE>   79
                                       70


      SECTION 9.04. Securities Owned by Company Deemed Not Outstanding. In
determining whether the holders of the requisite aggregate principal amount of
Securities have concurred in any direction, consent or waiver under this
Indenture, Securities which are owned by the Company or any other obligor on the
Securities or by any person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company or any other obligor
on the Securities shall be disregarded and deemed not to be outstanding for the
purpose of any such determination, except that for the purpose of determining
whether the Trustee shall be protected in relying on any such direction, consent
or waiver only Securities which the Trustee knows are 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
person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Company or any other obligor on the Securities.
In case of a dispute as to such right, the advice of counsel shall be full
protection in respect of any decision made by the Trustee in accordance with
such advice.

      SECTION 9.05. Right of Revocation of Action Taken. At any time prior to
(but not after) the evidencing to the Trustee, as provided in Section 9.01, of
the taking of any action by the holders of the percentage in aggregate principal
amount of the Securities of any or all series, as the case may be, specified in
this Indenture in connection with such action, any holder of a Security the
serial number of which is shown by the evidence to be included among the serial
numbers of the Securities the holders of which have consented to such action
may, by filing written notice at the Corporate Trust Office of the Trustee and
upon proof of holding as provided in Section 9.02, revoke such action so far as
concerns such Security. Except as aforesaid any such action taken by the holder
of any Security shall be conclusive and binding
<PAGE>   80
                                       71


upon the Company, the Trustee and the holders of all the Securities affected by
such action.

                                   ARTICLE TEN

                           SECURITY HOLDERS' MEETINGS

      SECTION 10.01. Purposes for Which Security Holders' Meetings May Be
Called. A meeting of holders of Securities of any or all series may be called at
any time and from time to time pursuant to the provisions of this Article Ten
for any of the following purposes:

            (a) To give any notice to the Company or to the Trustee, or to give
      any directions to the Trustee, or to waive any default hereunder and its
      consequences, or to take any other action authorized to be taken by
      Security holders, pursuant to any of the provisions of Article Seven;

            (b) To remove the Trustee and appoint a successor trustee pursuant
      to the provisions of Section 8.10;

            (c) To consent to the execution of an indenture or indentures
      supplemental hereto pursuant to the provisions of Section 11.02; or

            (d) To take any other action authorized to be taken by or on behalf
      of the holders of any specified aggregate principal amount of the
      Securities of any or all series under any other provision of this
      Indenture or under applicable law.

      SECTION 10.02. Trustee May Call Meeting. The Trustee may at any time call
a meeting of Security holders of any or all series to take any action specified
in Section 10.01, to be held at such time and at such place in the Borough of
Manhattan, The City of New York, State of New York, as the Trustee shall
determine. Notice of each meeting of the Security holders of any or all series,
setting forth the time and the place of such meeting and in general terms the
action proposed to be taken at such meeting, shall be given to the holders of
Securities of each series affected, at their last addresses as they shall appear
on the register, not less than 20 nor more than 90 days prior to the date fixed
for such meeting.

      SECTION 10.03. Company and Security Holders May Call Meeting. The Company,
pursuant to a resolution of its Board of Directors, or the holders of at least
10% in aggregate principal amount of Securities then outstanding of any or all
series, may at any time request the Trustee
<PAGE>   81
                                       72


to call a meeting of Security holders of any or all series, as the case may be,
to take any action authorized in Section 10.01. Such request shall be in
writing, setting forth in reasonable detail the action proposed to be taken at
such meeting. If the Trustee shall not give notice of such meeting to the
Security holders of the appropriate series within 20 days after receipt of such
written request, then the Company or the holders, in the amount specified, may
determine the time and the place in the Borough of Manhattan, The City of New
York, State of New York for such meeting and may call such meeting by giving
notice thereof as provided in Section 10.02.

      SECTION 10.04. Persons Entitled To Vote at Meeting. To be entitled to vote
at any meeting of Security holders a person shall (i) be a registered holder of
one or more Securities of a series with respect to which the meeting is being
held; or (ii) be a person appointed by an instrument in writing as proxy by a
registered holder of one or more securities of such series. The only persons who
shall be entitled to be present or to speak at any meeting of the Security
holders shall be the persons entitled to vote at such meeting and their counsel
and any representative of the Trustee and its counsel and any representative of
the Company and its counsel.

      SECTION 10.05. Determination of Voting Rights; Conduct and Adjournment of
Meeting. Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Security holders in regard to proof of the holding of Securities and of the
appointment of proxies and in regard to the appointment and duties of inspectors
of votes, the submission and examination of proxies, certificates and other
evidence of the right to vote, and such other matters concerning the conduct of
the meeting as it shall think fit. The holding of Securities and the appointment
of any proxy shall be proved in the manner specified in Section 9.02.

      The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Security holders as provided in Section 10.03, in which case the
Company or the Security holders calling the meeting, as the case may be, shall
in like manner appoint a temporary chairman. A permanent chairman and a
permanent secretary of the meeting shall be elected by vote of the holders of at
least a majority in principal amount of the Securities represented at the
meeting and entitled to vote.

<PAGE>   82
                                       73

      Subject to the provisions of Section 10.04, at any meeting each Security
holder or proxy shall be entitled to one vote for each $1,000 principal amount
(in the case of Original Issue Discount Securities, such principal amount for
all purposes of this Section 10.05 to be determined as provided in the last
paragraph of the definition of the term "outstanding" set forth in Section 1.01)
of Securities held or represented by him; provided, however, that no vote shall
be cast or counted at the meeting in respect of any Security challenged as not
outstanding and ruled by the chairman of the meeting to be not outstanding. The
chairman of the meeting shall have no right to vote except as a Security holder
or proxy. Any meeting of Security holders duly called pursuant to the provisions
of Section 10.02 or 10.03 may, by vote of the holders of at least a majority in
principal amount of the Securities represented at the meeting and entitled to
vote, be adjourned from time to time, and the meeting may be held as so
adjourned without further notice. At any meeting of Security holders, the
presence of persons holding or representing Securities in an aggregate principal
amount sufficient to take action on the business for the transaction of which
such meeting was called shall constitute a quorum, but if less than a quorum be
present, the persons holding or representing at least a majority in aggregate
principal amount of the Securities represented at the meeting and entitled to
vote may adjourn such meeting from time to time with the same effect, for all
intents and purposes, as though a quorum had been present; and the meeting may
be held as so adjourned without further notice.

      SECTION 10.06. Counting Vote and Recording Action of Meeting. The vote
upon any resolution submitted to any meeting of Security holders shall be by
written ballots on which shall be subscribed the signatures of the Security
holders or proxies and the principal amounts of the Securities being voted by
them. The permanent chairman of the meeting shall appoint two inspectors of
votes who shall count all votes cast at the meeting for or against any
resolution and who shall make and file with the secretary of the meeting their
verified written reports in duplicate of all votes cast at the meeting. A record
in duplicate of the proceedings of each meeting of Security holders shall be
prepared by the secretary of the meeting and there shall be attached to said
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more persons having knowledge of the
facts setting forth a copy of the notice of the meeting and showing that said
notice was mailed as provided in Section 10.02. The record shall be signed and
verified by the
<PAGE>   83
                                       74


affidavits of the permanent chairman and secretary of the meeting and one of the
duplicates shall be delivered to the Company and the other to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots voted
at the meeting.

      Any record so signed and verified shall be conclusive evidence of the
matters therein stated.

      SECTION 10.07. Call of Meeting Not To Affect Rights of Trustee and
Security Holders. Nothing in this Article Ten contained shall be deemed or
construed to authorize or permit, by reason of any call of a meeting of Security
holders or any rights expressly or impliedly conferred hereunder to make such
call, any hindrance or delay in the exercise of any right or rights conferred
upon or reserved to the Trustee or to the Security holders under any of the
provisions of this Indenture or of the Securities.

                                 ARTICLE ELEVEN

                             SUPPLEMENTAL INDENTURES

      SECTION 11.01. Supplemental Indentures Without Consent of Security
Holders. The Company, when authorized by a resolution of its Board of Directors,
and the Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act of 1939 as in force at the date of the execution thereof)
for one or more of the following purposes:

            (a) to convey, transfer, assign, mortgage or pledge to the Trustee
      as security for the Securities of one or more series any property or
      assets which the Company may desire or be required to convey, transfer,
      assign, mortgage or pledge;

            (b) to evidence the succession of another corporation to the
      Company, or successive successions, and the assumption by the successor
      corporation of the covenants, agreements and obligations of the Company
      pursuant to Article Twelve;

            (c) to add to the covenants of the Company such further covenants,
      restrictions, conditions or provisions as its Board of Directors and the
      Trustee shall consider to be for the protection of the holders of
      Securities of any or all 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 included for the benefit of such series
<PAGE>   84
                                       75


      only), and to make the occurrence, or the occurrence and continuance, of a
      default in any such additional covenants, restrictions, conditions or
      provisions an Event of Default permitting the enforcement of all or any of
      the several remedies provided in this Indenture as herein set forth;
      provided, however, that in respect of any such additional covenant,
      restriction, condition or provision such supplemental indenture may
      provide for a particular period of grace after default (which period may
      be shorter or longer than that allowed in the case of other defaults) or
      may provide for an immediate enforcement upon such an Event of Default or
      may provide for notice or may limit the remedies available to the Trustee
      upon such an Event of Default or may limit the right of the holders of at
      least a majority in aggregate principal amount of the Securities of any or
      all series at the time outstanding to waive such an Event of Default;

            (d) to cure any ambiguity or to correct or supplement any provision
      contained herein or in any supplemental indenture which may be defective
      or inconsistent with any other provision contained herein or in any
      supplemental indenture; or to make such other provisions in regard to
      matters or questions arising under this Indenture or under any
      supplemental indenture as the Board of Directors may deem necessary or
      desirable and which shall not adversely affect the interests of the
      holders of the Securities;

            (e) to provide for the issuance under this Indenture of Securities
      in coupon form (including Securities registrable as to principal only) and
      to provide for exchangeability of such Securities with Securities issued
      hereunder in fully registered form, and to make all appropriate changes
      for such purpose;

            (f) to establish the form or terms of Securities of any series as
      permitted by Section 2.02;

            (g) 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 8.11; and

            (h) to conform to any mandatory provisions of law.

      The Trustee is hereby authorized to join in the execution of any such
supplemental indenture, to make any further appropriate agreements and
<PAGE>   85
                                       76

stipulations which may be therein contained and to accept the conveyance,
transfer, assignment, mortgage or pledge of any property thereunder, but the
Trustee 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.

      Any supplemental indenture authorized by the provisions of this Section
11.01 may be executed without the consent of the holders of any of the
Securities at the time outstanding, notwithstanding any of the provisions of
Section 11.02.

      SECTION 11.02. Supplemental Indentures With Consent of Security Holders.
With the consent (evidenced as provided in Section 9.01) of the holders of not
less than 662/3% in aggregate principal amount of the Securities at the time
outstanding of all series affected by such supplemental indenture (voting as a
single class), the Company, when authorized by a resolution of its Board of
Directors, and the Trustee may, from time to time and at any time, enter into an
indenture or indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act of 1939 as in force at the date of
execution thereof) for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture or of modifying in any manner the rights of the holders
of the Securities of each such series; provided, however, that no such
supplemental indenture shall (a) extend the final maturity of any Security, or
reduce the principal amount thereof, or reduce the rate or extend the time of
payment of interest thereon, or reduce any premium payable upon redemption
thereof, or reduce the amount of the principal of an Original Issue Discount
Security that would be due and payable upon acceleration of maturity thereof
pursuant to Section 7.01 of the Indenture or the amount thereof provable in
bankruptcy pursuant to Section 7.02 of the Indenture, or alter the provisions of
the Indenture relating to the conversion of any series of Securities so as to
affect the rights of any holder of such series adversely, or impair or affect
the right of the holder of any such Security to institute suit for the payment
of the principal of (including any sinking fund payment) and premium, if any,
and interest, if any, on any such Security on or after the due date thereof,
without the consent of the holder of each Security so affected, or (b) reduce
the aforesaid percentage of Securities, the consent of the holders of which is
required for any such 

<PAGE>   86
                                       77

supplemental indenture, without the consent of the holders of all Securities at
the time outstanding of each series affected.

      Upon the request of the Company, accompanied by a copy of a resolution of
the Board of Directors certified by the secretary or an assistant secretary of
the Company authorizing the execution of any such supplemental indenture, and
upon the filing with the Trustee of evidence of the consent of Security holders
as aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion, but shall not be obligated to, enter
into such supplemental indenture.

      It shall not be necessary for the consent of the Security holders under
this Section 11.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.

      Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section 11.02, the
Company shall give notice thereof to the holders of Securities of each series
affected thereby at their addresses as they shall appear on the register,
setting forth in general terms the substance of such supplemental indenture. Any
failure of the Company to give such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture.

      SECTION 11.03. Effect of Supplemental Indentures. Upon the execution of
any supplemental indenture pursuant to the provisions of this Article Eleven or
Section 12.01, this Indenture shall be and be deemed to be modified and amended
in accordance therewith and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of the Trustee, the
Company and the holders of Securities of each series affected thereby shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.

<PAGE>   87
                                       78

      SECTION 11.04. Documents To Be Given to Trustee. The Trustee, subject to
the provisions of Section 8.01, may receive an Officers' Certificate and an
Opinion of Counsel as conclusive evidence that any such supplemental indenture
complies with the provisions of this Article Eleven.

      SECTION 11.05. Notation on Securities in Respect of Supplemental
Indentures. Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this Article Eleven or
after any action taken at a Security holders' meeting pursuant to Article Ten
may bear a notation in form approved by the Trustee as to any matter provided
for by such supplemental indenture or as to any action taken at any such
meeting. If the Company or the Trustee shall so determine, new Securities of any
series so modified as to conform, in the opinion of the Trustee and the Board of
Directors, to any modification of this Indenture contained in any such
supplemental indenture may be prepared by the Company, authenticated by the
Trustee and delivered in exchange for the Securities of such series then
outstanding.

      SECTION 11.06. Waiver of Compliance by Security Holders. Anything in this
Indenture to the contrary notwithstanding, any of the acts which the Company is
required to do, or is prohibited from doing, by any of the provisions of this
Indenture may, to the extent that such provisions might be changed or eliminated
by a supplemental indenture pursuant to Section 11.02 upon consent of holders of
not less than 66 2/3% in aggregate principal amount of the then outstanding
Securities of the series affected, be omitted or done by the Company, if there
is obtained the prior consent or waiver (evidenced as provided in Section 9.01)
of the holders of at least 66 2/3% in aggregate principal amount of the then
outstanding Securities of such series.

                                 ARTICLE TWELVE

                          CONSOLIDATION, MERGER OR SALE

      SECTION 12.01. Company May Consolidate, Merge or Sell on Certain Terms.
Nothing contained in this Indenture or in the Securities shall be deemed to
prevent the consolidation or merger of the Company with or into any other
corporation organized under the laws of the United States, any State 
<PAGE>   88
                                       79

thereof or the District of Columbia, or the merger into the Company of any other
corporation, or the sale by the Company to any corporation organized under the
laws of the United States, any State thereof or the District of Columbia of its
property and assets as, or substantially as, an entirety, or otherwise;
provided, however, (a) that, in case of any such consolidation or merger, the
corporation resulting from such consolidation or any corporation other than the
Company into which such merger shall be made shall succeed to and be substituted
for the Company with the same effect as if it had been named herein as a party
hereto and shall become liable and be bound for, and shall expressly assume, by
a supplemental indenture hereto, executed and delivered to the Trustee, the due
and punctual payment of the principal of and premium, if any, and interest, if
any, on all the Securities then outstanding and the performance and observance
of each and every covenant and condition of this Indenture on the part of the
Company to be performed or observed and (b) that, as a condition of any such
sale of the property and assets of the Company as, or substantially as, an
entirety, the corporation to which such property and assets shall be sold shall
(i) expressly assume, as a part of the purchase price thereof, the due and
punctual payment of the principal of and premium, if any, and interest, if any,
on the Securities then outstanding and the performance and observance of all the
covenants and conditions of this Indenture on the part of the Company to be
performed or observed, and (ii) simultaneously with the delivery to it of the
conveyances or instruments of transfer of such property and assets, execute and
deliver to the Trustee a supplemental indenture hereto, in form satisfactory to
the Trustee, whereby such purchasing corporation shall so assume the due and
punctual payment of the principal of and premium, if any, and interest, if any,
on all the Securities then outstanding and the performance and observance of
each and every covenant and condition of this Indenture on the part of the
Company to be performed or observed, to the same extent that the Company is
bound and liable.

      The Company shall not consolidate with any other corporation or accept a
merger of any other corporation into the Company or permit the Company to be
merged into any other corporation, or sell its properties and assets as, or
substantially as, an entirety, except upon the terms and conditions set forth in
this Section. Upon any consolidation or merger, or any sale of the properties
and assets of the Company as, or substantially as, an entirety in accordance
with the provisions of this Section, the corporation formed by such
consolidation or into which the Company shall have been merged or to which such
sale shall have been made shall succeed to and be substituted for the Company
with the same effect as if it had been named herein as a party hereto and
thereafter from time to time 
<PAGE>   89
                                       80

such successor corporation may exercise each and every right and power of the
Company under this Indenture, in the name of the Company or in its own name; and
any act or proceeding by any provision of this Indenture required or permitted
to be done by the Board of Directors or any officer of the Company may be done
with like force and effect by the like board or officer of any corporation that
shall at the time be the successor of the Company hereunder. In the event of the
sale by the Company of its properties and assets as, or substantially as, an
entirety upon the terms and conditions of this Section, the Company shall be
released from all its liabilities and obligations hereunder and under the
Securities.

      SECTION 12.02. Officers' Certificate and Opinion Of Counsel To Be Given to
Trustee. The Trustee, subject to the provisions of Section 8.01, may receive an
Officers' Certificate and an Opinion of Counsel as conclusive evidence that any
such consolidation, merger or sale, and any such assumption, complies with the
provisions of this Article Twelve.

                                ARTICLE THIRTEEN

                    SATISFACTION AND DISCHARGE OF INDENTURE;
                                UNCLAIMED MONEYS

      SECTION 13.01. Satisfaction and Discharge of Indenture. If at any time (i)
the Company shall pay or cause to be paid the principal of and premium, if any,
and interest, if any, on all the Securities outstanding of any series hereunder,
as and when the same shall become due and payable, or (ii) the Company shall
have delivered to the Trustee for cancellation all Securities of any series
theretofore authenticated (other than any Securities of such series which shall
have been destroyed, lost or stolen and which shall have been replaced or paid
as provided in Section 2.07), or (iii) all the Securities of any series not
theretofore delivered to the Trustee for cancellation shall have become due and
payable, or are by their terms to become due and payable within one year or are
to be called for redemption within one year under arrangements satisfactory to
the Trustee for the giving of notice of redemption, and the Company shall
deposit or cause to be deposited with the Trustee as trust funds the entire
amount sufficient to pay at maturity or upon redemption all of the Securities of
such series not theretofore delivered to the Trustee for cancellation, including
principal and premium, if any, and interest, if any, due or to become due to
such date of maturity or date fixed for redemption, as the case may be, and if,
in any such case, the Company shall also 
<PAGE>   90
                                       81

pay or cause to be paid all other sums payable hereunder by the Company, then
this Indenture shall cease to be of further effect with respect to Securities of
such series (except as to (i) remaining rights of registration of transfer,
substitution, conversion and exchange of Securities of such series, (ii) rights
hereunder of Security holders to receive payment of principal of and premium, if
any, and interest, if any, on the Securities of such series, and other rights,
duties and obligations of the Security holders as beneficiary hereof with
respect to the amounts, if any, so deposited with the Trustee, (iii) remaining
obligations of the Company to make payment hereunder, and (iv) the rights,
obligations and immunities of the Trustee hereunder), and the Trustee, on demand
of the Company accompanied by an Officers' Certificate and an Opinion of Counsel
as required by Section 14.04 and at the cost and expense of the Company, shall
execute proper instruments acknowledging satisfaction of and discharging this
Indenture with respect to Securities of such series. The Company agrees to
reimburse the Trustee for any costs or expenses thereafter reasonably and
properly incurred and to compensate the Trustee for any services thereafter
reasonably and properly rendered by the Trustee in connection with this
Indenture or the Securities of such series.

      SECTION 13.02. Application by Trustee of Funds Deposited for Payment of
Securities. Subject to Section 13.04, all moneys or U.S. Government Obligations
deposited, in respect of Securities of a series, with the Trustee pursuant to
Section 13.01 or 13.05 shall be held in trust and applied by it to the payment,
either directly or through any paying agent (including the Company acting as its
own paying agent), to the holders of the particular Securities of such series
for the redemption or payment of which such moneys or U.S. Government
Obligations have been deposited with the Trustee, of all sums due and to become
due thereon for principal, premium, if any, and interest, if any; but such money
need not be segregated from other funds except to the extent required by law.

      SECTION 13.03. Repayment of Moneys Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture with respect to Securities
of any series all moneys then held by any paying agent under the provisions of
this Indenture with respect to such series shall, upon demand of the Company, be
repaid to it or paid to the Trustee and thereupon such paying agent shall be
released from all further liability with respect to such moneys.
<PAGE>   91
                                       82

      SECTION 13.04. Return of Moneys Held by Trustee and Unclaimed for Three
Years. Any moneys deposited with the Trustee or any paying agent in trust for
the payment of the principal of or premium, if any, or interest, if any, on any
Securities of any series remaining unclaimed for three years after the date of
the maturity of the Securities of such series or the date fixed for the
redemption of all of the Securities of such series at the time outstanding or
the date such principal or premium, if any, or interest, if any, shall have
become due and payable, as the case may be, shall be repaid to the Company by
the Trustee or such paying agent on demand and all liability of the Trustee or
such paying agent with respect to such trust moneys shall thereupon cease and
the holder of any of the Securities of such series shall thereafter look only to
the Company for any payment which such holder may be entitled to collect.

      SECTION 13.05. Defeasance Upon Deposit of Moneys or U.S. Government
Obligations. At the Company's option, either (a) the Company shall be deemed to
have been Discharged (as defined below) from its respective obligations with
respect to any series of Securities on the 91st Day after the applicable
conditions set forth below have been satisfied or (b) the Company shall cease to
be under any obligation to comply with any term, provision or condition set
forth in Sections 5.05 and 12.01 with respect to any series of Securities at any
time after the applicable conditions set forth below have been satisfied:

            (1) the Company shall have deposited or caused to be deposited
      irrevocably with the Trustee as trust funds in trust, specifically pledged
      as security for, and dedicated solely to, the benefit of the holders of
      the Securities of such series (i) money in an amount, or (ii) U.S.
      Government Obligations which through the payment of interest and principal
      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
      (iii) a combination of (i) and (ii), sufficient, in the opinion (with
      respect to (ii) and (iii)) of a nationally recognized firm of independent
      public accountants expressed in a written certification thereof delivered
      to the Trustee, to pay and discharge each installment of principal
      (including any mandatory sinking fund payments) of, premium, if any, and
      interest, if any, on, the Securities outstanding of such series on the
      dates such installments of interest or principal are due;
<PAGE>   92
                                       83

            (2) if the Securities of such series are then listed on the New York
      Stock Exchange, the Company shall have delivered to the Trustee an opinion
      of counsel of a law firm of nationally recognized standing to the effect
      that the exercise of the option under this Section 13.05 would not cause
      such Securities to be delisted;

            (3) no Event of Default or event which with notice or lapse of time
      would become an Event of Default with respect to the Securities of such
      series shall have occurred and be continuing on the date of such deposit;
      and

            (4) the Company shall have delivered to the Trustee an opinion of
      counsel of a law firm of nationally recognized standing to the effect that
      holders of the Securities of such series will not recognize income, gain
      or loss for United States Federal income tax purposes as a result of the
      exercise of the option under this Section 13.05 and will be subject to
      United States Federal income tax on the same amount and in the same manner
      and at the same times as would have been the case if such option had not
      been exercised.

"Discharged" means that the Company shall be deemed to have paid and discharged
the entire indebtedness represented by, and obligations under, the Securities of
such series and to have satisfied all the obligations under this Indenture
relating to the Securities of such series (and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging the same), except
(A) the rights of holders of Securities of such series to receive, from the
trust fund described in clause (1) above, payment of the principal of or
premium, if any, and the interest, if any, on such Securities when such payments
are due; (B) the Company's obligations with respect to such Securities under
Sections 2.06, 2.07, 4.02, 5.02 and 13.04; and (C) the rights, powers, trusts,
duties and immunities of the Trustee hereunder.

                                ARTICLE FOURTEEN

                            MISCELLANEOUS PROVISIONS

      SECTION 14.01. Benefits of Indenture Restricted to Parties and Security
Holders. Except as provided in this Article Fourteen, nothing in this Indenture,
or in the Securities, express or implied, shall give or be construed to give to
any person, other than the parties hereto, and their successors and assigns, 
and the Security holders, any legal or equitable right, remedy or claim under or
in respect of this Indenture, or under any 

<PAGE>   93
                                       84

covenant, condition and provision herein contained; and all its covenants,
conditions and provisions shall be for the sole benefit of the parties hereto
and of the holders of the Securities.

      SECTION 14.02. Successors and Assigns. All the covenants, stipulations,
promises and agreements in this Indenture contained by or in behalf of the
Company shall bind and inure to the benefit of its successors and assigns,
whether so expressed or not.

      SECTION 14.03. Notices and Demands. Except as provided in paragraph (d) of
Section 7.01, any notice or demand which by any provision of this Indenture is
required or permitted to be given or served by the Trustee or by the holders of
Securities to or on the Company may be given or served by first-class mail,
postage prepaid, addressed (until another address of the Company is filed by the
Company with the Trustee) to Aetna Life and Casualty Company, 151 Farmington
Avenue, Hartford, Connecticut 06156, and marked for the attention of the
Treasurer.

      Any notice, direction, request or demand by the Company or any Security
holder to or upon the Trustee shall be deemed to have been sufficiently given or
made, for all purposes, if given or made at the Corporate Trust Office or at the
Trustee's agency office located at BancBoston Clearance, Inc., One Exchange
Place, 55 Broadway, Third Floor, New York, New York 10006. Attention: Manager.

      Any notice, direction or request by the Company or the Trustee to or upon
any Security holder shall be given by first-class mail, postage prepaid,
addressed to the Security holders at their addresses as they appear in the
register; provided, however, that the Company or the Trustee, upon a good faith
determination that mailing is in the circumstances impractical, may give such
notice, direction, or request by any other method which, in the reasonable
belief of the Company or, in the case of the Trustee, of the Company and the
Trustee, is likely to be received by the Security holders.

      Any notice, direction, request or demand, addressed as provided in this
Section 14.03, and given by first-class mail, postage prepaid, shall be
conclusively presumed given when mailed.

      SECTION 14.04. Officers' Certificates and Opinions of Counsel; Statements
To Be Contained Therein. Upon any application or demand by the Company to the
Trustee to take any action under any of the provisions of this Indenture (unless
other evidence in respect thereof be 

<PAGE>   94
                                       85

herein specifically prescribed) the Company shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent provided for in this
Indenture relating to the proposed action have been complied with and an Opinion
of Counsel stating that in the opinion of such counsel all such conditions
precedent have been complied with, except that in the case of any such
application or demand as to which the furnishing of such documents is
specifically required by any provision of this Indenture relating to such
particular application or demand, no additional certificate or opinion need be
furnished.

      Each Officers' Certificate or Opinion of Counsel provided for in this
Indenture and delivered to the Trustee with respect to compliance with a
condition or covenant provided for in this Indenture shall include (i) a
statement that the person making such Officers' Certificate or Opinion of
Counsel has read such covenant or condition, (ii) a brief statement as to the
nature and scope of the examination or investigation upon which the statements
or opinions contained in such Officers' Certificate or Opinion of Counsel are
based, (iii) a statement that, in the opinion of such person, 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 (iv) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.

      Any certificate, statement or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon an opinion of or
representation by counsel, unless such officer knows or in the exercise of
reasonable care should know that the opinion or representation with respect to
such legal matters upon which his certificate, statement or opinion may be based
is erroneous.

      Any certificate, statement or opinion of counsel may be based, insofar as
it relates to factual matters (information with respect to which is in the
possession of the Company) upon the certificate, statement, opinion or
representation by an officer of the Company, unless such counsel knows or in the
exercise of reasonable care should know that the certificate, statement, opinion
or representation with respect to such factual matters upon which his
certificate, statement or opinion may be based is erroneous.

      Any certificate, statement or opinion of an officer of the Company or of
counsel may be based, insofar as it relates to accounting matters, upon a
certificate, opinion or representation by an accountant or firm of 

<PAGE>   95
                                       86

accountants in the employ of the Company, unless such officer or counsel, as the
case may be, knows or in the exercise of reasonable care should know that the
certificate, opinion or representation with respect to such accounting matters
upon which his certificate, statement or opinion may be based is erroneous.

      SECTION 14.05. Payments Due on Saturdays, Sundays and Holidays. In any
case where the date of maturity of principal of or premium, if any, or interest,
if any, on the Securities or the date fixed for redemption of any Securities or
the last day on which a Security holder has the right to convert his Security at
a particular conversion price shall not be a business day, then payment of
principal or premium, if any, or interest, if any, or conversion may be made on
the next succeeding business day with the same force and effect as if made on
the date of maturity or the date fixed for redemption or the last date for
conversion at such price and no interest shall accrue for the period after such
date.

      SECTION 14.06. Conflict of Any Provision of Indenture With Trust Indenture
Act of 1939. If and to the extent that any provision of this Indenture limits,
qualifies or conflicts with another provision included in this Indenture which
is required to be included herein by any of Sections 310 to 317, inclusive, of
the Trust Indenture Act of 1939, such required provision shall control.

      SECTION 14.07. Personal Immunity from Liability of Incorporators,
Stockholders, Etc. No recourse shall be had for the payment of the principal of
or premium, if any, or interest, if any, on any Security, or for any claim based
thereon, or otherwise in respect of any Security, or based on or in respect of
this Indenture or any indenture supplemental hereto, against any incorporator,
or against any past, present or future stockholder, director or officer, as
such, of the Company or of any successor corporation, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise, all such liability being expressly waived and released as
a condition of, and as consideration for, the execution of this Indenture and
the issue of the Securities.

      SECTION 14.08. Laws of State of New York To Govern. This Indenture and
each Security hereunder shall be deemed to be a contract made under the laws of
the State of New York and shall be construed for all purposes in accordance with
the laws of said State, except to the 

<PAGE>   96
                                       87

extent, if any, that Connecticut law applies under mandatory provisions of such
law.

      SECTION 14.09. Counterparts. This Indenture may be executed in any number
of counterparts, each of which shall be an original; but such counterparts shall
together constitute but one and the same instrument.

      SECTION 14.10. Acceptance of Trust by Trustee. The First National Bank of
Boston hereby accepts the trusts in this Indenture declared and provided, upon
the terms and conditions hereinabove set forth.

      SECTION 14.11. Effect of Headings. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.

      IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.

                                     AETNA LIFE AND CASUALTY COMPANY


                                     By /s/ GARY G. BENANAV

                                            Vice President-Finance and Treasurer

[CORPORATE SEAL]

Attest: /s/ LOUISE L. MCCORMICK
            Corporate Secretary

                                     THE FIRST NATIONAL BANK OF BOSTON


                                     By /s/ ROBERT J. DUNN

                                            Assistant Vice President

[CORPORATE SEAL]

Attest: /s/ AMY M. AHLES
            Assistant Cashier
<PAGE>   97
                                       88

STATE OF CONNECTICUT  ) ss.:
COUNTY OF HARTFORD    )

      On this 15th day of January, before me personally came GARY G. BENANAV, to
me known, who, being by me duly sworn, did depose and say that he resides at 20
Northmoor Rd., West Hartford, Ct.; that he is a Vice President-Finance and
Treasurer of AETNA LIFE AND CASUALTY COMPANY, the insurance corporation
described in and which executed the above instrument; that he knows the
corporate seal of such corporation; that the seal affixed to the said instrument
is such corporate seal; that it was so affixed by authority of the Board of
Directors of such corporation; and that he signed his name thereto by like
authority.

      IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.

[SEAL]

                                       NOREEN M. O'CONNELL
                                          Notary Public

COMMONWEALTH OF MASSACHUSETTS ) ss.:
COUNTY OF SUFFOLK             )

      On this 15th day of January, before me personally came ROBERT J. DUNN, to
me known, who, being by me duly sworn, did depose and say that he resides at
1956 Bay Road, Stoughton, Massachusetts; that he is an Assistant Vice President
of THE FIRST NATIONAL BANK OF BOSTON, the corporation described in and which
executed the above instrument; that he knows the corporate seal of such
corporation; that the seal affixed to the said instrument is such corporate
seal; that it was so affixed by authority of the Board of Directors of such
corporation; and that he signed his name thereto by like authority.

      IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.

[SEAL]

                                 CATHY A. THORN
                                  Notary Public