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                                                                   Exhibit 4.1



                              VERTICALNET, INC.,

                                    ISSUER

                                      TO

                            BANKERS TRUST COMPANY,

                                    TRUSTEE

                                  __________

                                   INDENTURE

                        Dated as of September 27, 1999

                                  __________

                               U.S. $100,000,000

              5 1/4% CONVERTIBLE SUBORDINATED DEBENTURES DUE 2004
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     INDENTURE, dated as of September 27, 1999, between VERTICALNET, INC., a
corporation duly organized and existing under the laws of the State of
Pennsylvania, having its principal office at 700 Dreshner Road, Horsham,
Pennsylvania 19044 (herein called the "Company"), and BANKERS TRUST COMPANY, a
New York banking corporation, as Trustee (herein called the "Trustee"), having
its principal Corporate Trust offices at Four Albany Street, New York, New York
10006.

                            RECITALS OF THE COMPANY

     The Company has duly authorized the creation of an issue of its 5 1/4%
Convertible Subordinated Debentures Due 2004 (herein called the "Securities") of
substantially the tenor and amount hereinafter set forth, and to provide
therefor the Company has duly authorized the execution and delivery of this
Indenture.

     All things necessary to make the Securities, when the Securities are
executed by the Company and authenticated and delivered hereunder and duly
issued by the Company, the valid obligations of the Company, and to make this
Indenture a valid agreement of the Company, in accordance with their and its
terms, have been done.

     NOW, THEREFORE, THIS INDENTURE WITNESSETH:

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

                                   ARTICLE 1


                       DEFINITIONS AND OTHER PROVISIONS
                            OF GENERAL APPLICATION

     SECTION 1.1  Definitions.

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

     (1) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular;
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     (2) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with U.S. generally accepted accounting
principles prevailing at the time of any relevant computation hereunder; and

     (3) the words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.

     "Accredited Investor" means an accredited investor within the meaning of
Rule 501(a)(1), (2), (3), (5), (6) or (7) of Regulation D under the Securities
Act.

     "Act", when used with respect to any Holder of a Security, has the meaning
specified in Section 1.3.(a).

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

     "Agent Members" has the meaning specified in Section 2.5(d)(5).

     "Authenticating Agent" means any Person named as Authenticating Agent
pursuant to Section 5.12.

     "Board of Directors" means either the board of directors of the Company or
any committee of that board empowered to act for it with respect to this
Indenture.

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

     "Business Day," when used with respect to any Place of Payment or Place of
Conversion, means each Monday, Tuesday, Wednesday, Thursday and Friday which is
not a day on which banking institutions in that Place of Payment or Place of
Conversion or the Corporate Trust Office of the Trustee, as the case may be, are
authorized or obligated by law to close.

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     "Capitalized Lease Obligation" means, as applied to any Person, any lease
of any property (whether real, personal or mixed) by that Person as lessee
which, in conformity with U.S. generally accepted accounting principles
prevailing at the time of any relevant determination hereunder, is required to
be accounted for as a capital lease on the balance sheet of that Person.

     "Change of Control" means an event or series of events as a result of which
(i) any "person" (as such term is used in Section 13(d)(3) of the Exchange Act)
acquires beneficial ownership, directly or indirectly, through a purchase,
merger or other acquisition transaction or series of transactions, of shares of
capital stock of the Company entitling such person to exercise 50% or more of
the combined voting power of the then outstanding securities entitled to vote
generally in elections of directors of the Company ("Voting Stock"), other than
any such acquisition by the Company, any Subsidiary of the Company or any
employee benefit plan of the Company; or (ii) the Company consolidates with or
merges into any other person, any merger of another person into the Company, or
any conveyance, transfer, sale, lease or other disposition of all or
substantially all of the properties and assets of the Company to another person,
other than (a) any such transaction (x) that does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares of
capital stock of the Company and (y) pursuant to which holders of capital stock
of the Company immediately prior to such transaction have the entitlement to
exercise, directly or indirectly, 50% or more of the total voting power of all
shares of capital stock of the Company entitled to vote generally in the
election of directors of the continuing or surviving person immediately after
such transaction and (b) any merger which is effected solely to change the
jurisdiction of incorporation of the Company and results in a reclassification,
conversion or exchange of outstanding shares of Common Stock solely into shares
of common stock of the surviving entity; provided, however, that a Change of
                                         --------  -------
Control shall not be deemed to have occurred if the Closing Price per share of
the Common Stock for any five Trading Days within the period of ten consecutive
Trading Days ending immediately after the later of the Change of Control or the
public announcement of the Change of Control, in the case of clause (i) above,
or the period of ten consecutive Trading Days ending immediately before the
Change of Control, in the case of clause (ii) above shall equal or exceed 110%
of the Conversion Price of the Securities in effect on each such Trading Day.
Beneficial ownership will be determined in accordance with Rule 13d-3 of the
Exchange Act.  The term "person" includes any syndicate or group which would be
deemed a person under Section 13(d)(3) of the Exchange Act.

     "Closing Date" means September 27, 1999 or such later date on which the
Securities may be delivered pursuant to the Purchase Agreement.

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     "Closing Price" with respect to any securities on any day shall mean the
closing sales price regular way on such day or, in case no such sale takes place
on such day, the average of the reported closing bid and asked prices, regular
way, in each case on the Nasdaq National Market, or, if such security is not
listed or admitted to trading on the Nasdaq National Market, on the principal
national security exchange or quotation system on which such security is quoted
or listed or admitted to trading, or, if not quoted or listed or admitted to
trading on any national securities exchange or quotation system, the average of
the closing bid and asked prices of such security on the over-the-counter market
on the day in question as reported by the National Quotation Bureau
Incorporated, or a similar generally accepted reporting service, or if not so
available, in such manner as furnished by any New York Stock Exchange member
firm selected from time to time by the Board of Directors for that purpose, or a
price determined in good faith by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution.

     "Common Stock" includes any stock of any class of the Company which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the Company
and which is not subject to redemption by the Company.  However, subject to the
provisions of Section 12.11, shares issuable on conversion of Securities shall
include only shares of the class designated as Common Stock, par value $0.01 per
share, of the Company at the date of this Indenture or shares of any class or
classes resulting from any reclassification or reclassifications thereof and
which have no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company and which are not subject to redemption by the Company, provided
                                                                    --------
that if at any time there shall be more than one such resulting class, the
shares of each such class then so issuable shall be substantially in the
proportion which the total number of shares of such class resulting from all
such reclassifications bears to the total number of shares of all such classes
resulting from all such reclassifications.

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

     "Company Notice" has the meaning specified in Section 11.3.

     "Company Request" or "Company Order" means a written request or order
signed in the name of the Company by the Chairman of the Board, the Chief
Executive Officer, Chief Financial Officer, a Vice Chairman of the Board, the
President or a Vice President,

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and by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary of the Company, and delivered to the Trustee.

     "Conversion Agent" means any Person authorized by the Company pursuant to
Section 9.2 to convert Securities in accordance with Article 12.

     "Conversion Price" has the meaning specified in Section 12.1.

     "Corporate Trust Office" means the office of the Trustee located in The
City of New York at which at any particular time its corporate trust business
shall be administered (which at the date of this Indenture is located at Four
Albany Street, New York, New York  10006).

     "corporation" includes corporations, associations, limited liability
companies, companies and business trusts.

     "Custodian" shall mean Bankers Trust Company, as custodian with respect to
the Securities in global form, or any successor entity thereto.

     "Defaulted Interest" has the meaning specified in Section 2.7.

     "Depositary" shall mean, with respect to the Securities issuable or issued
in whole or in part in global form, the person specified in Section 2.5(e) as
the Depositary with respect to such Securities, until a successor shall have
been appointed and become such pursuant to the applicable provisions of this
Indenture, and thereafter, "Depositary" shall mean or include such successor.

     "Dollar," "U.S. Dollar" or "U.S. $" means a dollar or other equivalent unit
in such coin or currency of the United States as at the time shall be legal
tender for the payment of public and private debts.

     "Event of Default" has the meaning specified in Section 4.1.

     "Exchange Act" means the U.S. Securities Exchange Act of 1934, as amended.

     "Exchange Rate Contract" means, with respect to any Person, any currency
swap agreements, forward exchange rate agreements, foreign currency futures or
options, exchange rate collar agreements, exchange rate insurance and other
agreements or arrangements, or combination thereof, designed to provide
protection against fluctuations in currency exchange rates.

     "Global Security" has the meaning specified in Section 2.2.

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     "guarantee" means, as applied to any obligation, (i) a guarantee (other
than by endorsement of negotiable instruments for collection in the ordinary
course of business), direct or indirect, in any manner, of any part or all of
such obligation and (ii) an agreement, direct or indirect, contingent or
otherwise, the effect of which is to assure in any way the payment or
performance (or payment of damages in the event of non-performance) of any part
or all of such obligation, including, without limiting the foregoing, the
payment of amounts drawn down by letters of credit.

     "Holder," when used with respect to any Security, means the Person in whose
name the Security is registered in the Security Register.

     "Indebtedness," when used with respect to any Person, means

          (a) all indebtedness, obligations and other liabilities (contingent or
     otherwise) of such Person for borrowed money (including obligations of the
     Company in respect of overdrafts and any loans or advances from banks,
     whether or not evidenced by notes or similar instruments) or evidenced by
     bonds, debentures, notes or other instruments for the payment of money, or
     incurred in connection with the acquisition of any property, services or
     assets (whether or not the recourse of the lender is to the whole of the
     assets of such Person or to only a portion thereof), other than any account
     payable or other accrued current liability or obligation to trade creditors
     incurred in the ordinary course of business in connection with the
     obtaining of materials or services,

          (b) all reimbursement obligations and other liabilities (contingent or
     otherwise) of such Person with respect to letters of credit, bank
     guarantees, bankers' acceptances, surety bonds, performance bonds or other
     guaranty of contractual performance,

          (c) all obligations and liabilities (contingent or otherwise) in
     respect of (y) Capitalized Lease Obligations and (z) any lease or related
     documents (including a purchase agreement) in connection with the lease of
     real property which provides that such Person is contractually obligated to
     purchase or cause a third party to purchase the leased property and thereby
     guarantee a minimum residual value of the leased property to the landlord
     and the obligations of such Person under such lease or related document to
     purchase or to cause a third party to purchase the leased property,

          (d) all obligations of such Person (contingent or otherwise) with
     respect to an Interest Rate Protection Agreement or an Exchange Rate
     Contract,

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          (e) all direct or indirect guaranties or similar agreements by such
     Person in respect of, and obligations or liabilities (contingent or
     otherwise) of such Person to purchase or otherwise acquire or otherwise
     assure a creditor against loss in respect of, indebtedness, obligations or
     liabilities of another Person of the kind described in clauses (a) through
     (d),

          (f) any indebtedness or other obligations described in clauses (a)
     through (d) secured by any mortgage, pledge, lien or other encumbrance
     existing on property which is owned or held by such Person, regardless of
     whether the indebtedness or other obligation secured thereby shall have
     been assumed by such Person, and

          (g) any and all deferrals, renewals, extensions and refundings of, or
     amendments, modifications or supplements to, any indebtedness, obligation
     or liability of the kind described in clauses (a) through (f).

     "Indenture" means this instrument as originally executed or as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof.

     "Interest Payment Date" means the Stated Maturity of an installment of
interest on the Securities.

     "Interest Rate Protection Agreement" means, with respect to any Person, any
interest rate swap agreement, interest rate cap or collar agreement or other
financial agreement or arrangement designed to protect such person against
fluctuations in interest rates, as in effect from time to time.

     "Internal Revenue Code" means the U.S. Internal Revenue Code of 1986, as
amended.

     "Liquidated Damages" means all liquidated damages, if any, payable pursuant
to Section 3 of the Registration Rights Agreement.

     "Maturity" means the date on which the principal of such Security becomes
due and payable as therein or herein provided, whether at the Stated Maturity or
by acceleration, conversion, call for redemption, exercise of a Repurchase Right
or otherwise.

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     "Nasdaq National Market" means the Nasdaq National Market or any successor
national securities exchange or automated over-the-counter trading market in the
United States.

     "Non-Electing Share" has the meaning specified in Section 12.11.

     "Officers' Certificate" means a certificate signed by the Chairman of the
Board, the Chief Executive Officer, the President or a Vice President and by the
Chief Financial Officer, the Treasurer or the Secretary of the Company, and
delivered to the Trustee.

     "Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Company (and may include directors or employees of the Company) and
which opinion is acceptable to the Trustee which acceptance shall not be
unreasonably withheld.

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

            (i)   Securities theretofore canceled by the Trustee or delivered to
     the Trustee for cancellation;

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

            (iii) Securities which have been paid pursuant to Section 2.6 or in
     exchange for or in lieu of which other Securities have been authenticated
     and delivered pursuant to this Indenture, other than any such Securities in
     respect of which there shall have been presented to the Trustee proof
     satisfactory to it that such Securities are held by a bona fide purchaser
     in whose hands such Securities are valid obligations of the Company;

provided, however, that in determining whether the Holders of the requisite
--------  -------
principal amount of Outstanding Securities are present at a meeting of Holders
of Securities for quorum purposes or have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall

                                       8
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be protected in relying upon any such determination as to the presence of a
quorum or upon any such request, demand, authorization, direction, notice,
consent or waiver, only such Securities of which the Trustee has received
written notice and 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 Affiliate of the Company or such
other obligor.

     "Paying Agent" means any Person authorized by the Company to pay the
principal of, and premium, if any, or interest (including Liquidated Damages, if
any) on any Securities on behalf of the Company.

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

     "Place of Conversion" has the meaning specified in Section 2.1.

     "Place of Payment" has the meaning specified in Section 2.1.

     "Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 2.6 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.

     "Purchase Agreement" means the Purchase Agreement, dated September 21,
1999, between the Company and Lehman Brothers Inc., Hambrecht & Quist LLC, SG
Cowen Securities Corporation and Volpe Brown Whelan & Company, LLC.

     "QIB" shall mean a "qualified institutional buyer" as defined in Rule 144A.

     "Record Date" means either a Regular Record Date or a Special Record Date,
as the case may be.

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

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

     "Registration Rights Agreement" means the Registration Rights Agreement
dated as of September 27, 1999, between the Company and the Lehman Brothers
Inc., Hambrecht & Quist LLC, SG Cowen Securities Corporation and Volpe Brown
Whelan & Company, LLC.

     "Regular Record Date" for the interest payable means the March 13 (whether
or not a Business Day) next preceding a March 27 Interest Payment Date and the
September 13 (whether or not a Business Day) next preceding a September 27
Interest Payment Date.

     "Repurchase Right" has the meaning specified in Section 11.1.

     "Reset Transaction" means a merger, consolidation or statutory share
exchange to which the entity that is the issuer of the common shares into which
the Securities are then convertible is a party, a sale of all or substantially
all the assets of that entity, a recapitalization of those common shares or a
distribution pursuant to Section 12.4(d), after the effective date of which such
transaction or distribution the Securities would be convertible into (a) shares
of an entity the common shares of which had a Dividend Yield for the four fiscal
quarters of such entity immediately preceding the public announcement of such
transaction or distribution that was more than 2.5% higher than the Dividend
Yield on the Common Stock (or other common shares then issuable upon conversion
of the Securities) for the four fiscal quarters preceding the public
announcement of such transaction or distribution, or (b) shares of an entity
that announces a dividend policy prior to the effective date of such transaction
or distribution which policy, if implemented, would result in a Dividend Yield
on such entity's common stock for the next four fiscal quarters that would
result in such a 2.5% basis point increase.

     "Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Office of the Trustee, including any
principal, vice president, assistant vice president, assistant secretary, any
assistant treasurer, the managing director or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of such
officer's knowledge of and familiarity with the particular subject.

     "Restricted Securities" means the Securities defined as such in Section
2.5(e).

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     "Rule 144" means Rule 144 under the Securities Act (including any successor
rule thereof), as the same may be amended from time to time.

     "Rule 144A" shall mean Rule 144A as promulgated under the Securities Act
(including any successor rule thereof), as the same may be amended from time to
time.

     "Rule 144A Information" has the meaning specified in Section 9.9.

     "Securities" has the meaning ascribed to it in the first paragraph under
the caption "Recitals of the Company."

     "Securities Act" means the U.S. Securities Act of 1933, as amended.

     "Securities Register" and "Security Register" have the respective meanings
specified in Section 2.5(a).

     "Senior Debt" means the principal of, premium, if any, interest (including
all interest accruing subsequent to the commencement of any bankruptcy or
similar proceeding, whether or not a claim for post-petition interest is
allowable as a claim in any such proceeding) and rent payable on or termination
payment with respect to or in connection with, and all fees, costs, expenses and
other amounts accrued or due on or in connection with, Indebtedness of the
Company, whether outstanding on the date hereof or hereafter created, incurred,
assumed, guaranteed or in effect guaranteed by the Company (including all
deferrals, renewals, extensions or refundings of, or amendments, modifications
or supplements to, the foregoing), unless in the case of any particular
Indebtedness the instrument creating or evidencing the same or the assumption or
guarantee thereof expressly provides that such Indebtedness shall not be senior
in right of payment to the Securities or expressly provides that such
Indebtedness is pari passu or junior to the Securities. Notwithstanding the
foregoing, the term Senior Debt shall not include Indebtedness of the Company to
any Subsidiary of the Company, a majority of the voting stock of which is owned,
directly or indirectly, by the Company.

     "Significant Subsidiary" means any Subsidiary which is a "significant
subsidiary" within the meaning of Rule 405 under the Securities Act.

     "Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 2.7.

     "Stated Maturity" means the date specified in any Security as the fixed
date for the payment of principal on such Security or on which an installment of
interest on such Security is due and payable.

                                       11
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     "Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Company or by one or
more other Subsidiaries, or by the Company and one or more other Subsidiaries.
For the purposes of this definition only, "voting stock" means stock which
ordinarily has voting power for the election of directors, whether at all times
or only so long as no senior class of stock has such voting power by reason of
any contingency.

     "Trading Day" shall mean (x) if the applicable security is listed or
admitted for trading on the New York Stock Exchange or another national security
exchange, a day on which the New York Stock Exchange or another national
security exchange is open for business or (y) if the applicable security is
quoted on the Nasdaq National Market, a day on which trades may be made thereon
or (z) if the applicable security is not so listed, admitted for trading or
quoted, any day other than a Saturday or Sunday or a day on which banking
institutions in the State of New York are authorized or obligated by law or
executive order to close.

     "Transfer Agent" means any Person, which may be the Company, authorized by
the Company to exchange or register the transfer of Securities.

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

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

     SECTION 1.2  Form of Documents Delivered to Trustee.

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

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

                                       12
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certificate or representations by, an officer or officers of the Company stating
that the information with respect to such factual matters is in the possession
of the Company, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or representations with respect to such
matters are erroneous.

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

     Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee an Officers' Certificate stating that all conditions precedent, if any,
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, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.

     Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include:

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

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

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

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

                                       13
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     SECTION 1.3  Acts of Holders of Securities.

     (a)  Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders of Securities may be embodied in and evidenced by (1) one or more
instruments of substantially similar tenor signed by such Holders in person or
by agent or proxy duly appointed in writing, (2) the record of Holders of
Securities voting in favor thereof, either in person or by proxies duly
appointed in writing, at any meeting of Holders of Securities duly called and
held in accordance with the provisions of Article 8 or (3) a combination of such
instruments and any such record. Except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments or record
or both are delivered to the Trustee and, where it is hereby expressly required,
to the Company. Such instrument or instruments and record (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Holders of Securities signing such instrument or instruments and so
voting at such meeting. Proof of execution of any such instrument or of a
writing appointing any such agent or proxy, or of the holding by any Person of a
Security, shall be sufficient for any purpose of this Indenture and (subject to
Section 5.1) conclusive in favor of the Trustee and the Company if made in the
manner provided in this Section. The record of any meeting of Holders of
Securities shall be proved in the manner provided in Section 8.6.

     (b)  The fact and date of the execution by any Person of any such
instrument or writing may be provided in any manner which the Trustee reasonably
deems sufficient.

     (c)  The principal amount and serial numbers of Securities held by any
Person, and the date of such Person holding the same, shall be proved by the
Security Register.

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

     SECTION 1.4  Notices, Etc., to Trustee and Company.

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

                                       14
<PAGE>

          (1) the Trustee by any Holder of Securities or by the Company shall be
     sufficient for every purpose hereunder if in writing, mailed, first-class
     postage prepaid or telecopied at Bankers Trust Company, Corporate Trust and
     Agency Services and confirmed by mail, first-class postage prepaid,
     addressed to it at Four Albany Street, 4th Floor, New York, New York
     10006, to the attention of Corporate Marketing Services, or in the case of
     notice by telecopy confirmed at 212-250-9392, or at any other address or
     telecopy number otherwise furnished in writing to the Company by the
     Trustee; or

          (2) the Company by the Trustee or by any Holder of Securities shall be
     sufficient for every purpose hereunder (unless otherwise herein expressly
     provided) if in writing, mailed, first-class postage prepaid or telecopied
     at 215-784-1960 and confirmed by mail, first-class postage prepaid,
     addressed to it at 700 Dreshner Road, Horsham, Pennsylvania  19044, to the
     attention of its President, with a copy to its Chief Financial Officer, or
     at any other address or telecopy number otherwise furnished in writing to
     the Trustee by the Company.

     Any request, demand, authorization, direction, notice, consent, election or
waiver required or permitted under this Indenture shall be in the English
language.

     SECTION 1.5  Notice to Holders of Securities; Waiver.

     Except as otherwise expressly provided herein, where this Indenture
provides for notice to Holders of Securities of any event, such notice shall be
sufficiently given to Holders of Securities if mailed, first-class postage
prepaid, to each Holder of a Security affected by such event, at the address of
such Holder as it appears in the Security Register, not earlier than the
earliest date and not later than the latest date prescribed for the giving of
such notice.

     Neither the failure to mail such notice, nor any defect in any notice so
mailed, to any particular Holder of a Security shall affect the sufficiency of
such notice with respect to other Holders of Securities.  In case by reason of
the suspension of regular mail service or by reason of any other cause it shall
be impracticable to give such notice by mail, then such notification to Holders
of Securities as shall be made with the approval of the Trustee shall constitute
a sufficient notification to such Holders for every purpose hereunder.

     Such notices shall be deemed to have been given on the date of such
mailing.

     Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the

                                       15
<PAGE>

event, and such waiver shall be the equivalent of such notice. Waivers of notice
by Holders shall be filed with the Trustee, but such filing shall not be a
condition precedent to the validity of any action taken in reliance upon such
waiver.

     SECTION 1.6  Effect of Headings and Table of Contents.

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

     SECTION 1.7  Successors and Assigns.

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

     SECTION 1.8  Separability Clause.

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

     SECTION 1.9  Benefits of Indenture.

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

     SECTION 1.10  GOVERNING LAW.

     THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO SUCH
STATE'S CONFLICT OF LAWS PRINCIPLES THAT WOULD CAUSE THE LAWS OF ANY
JURISDICTION OTHER THAN THE STATE OF NEW YORK TO BE APPLIED.

     SECTION 1.11  Counterparts.

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

                                       16
<PAGE>

     SECTION 1.12  Legal Holidays.

     In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security or the last day on which a Holder of a Security has a
right to convert such Security shall not be a Business Day at any Place of
Payment or Place of Conversion, then (notwithstanding any other provision of
this Indenture or of the Securities) payment of interest (including Liquidated
Damages, if any) or principal or premium, if any, or conversion of the
Securities, need not be made at such Place of Payment or Place of Conversion on
such day, but may be made on the next succeeding Business Day at such Place of
Payment or Place of Conversion with the same force and effect as if made on the
Interest Payment Date or Redemption Date or at the Stated Maturity or on such
last day for conversion, provided, that in the case that payment is made on such
                         --------
succeeding Business Day, no interest shall accrue on the amount so payable for
the period from and after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be.

     SECTION 1.13  Recourse Against Others.

     No recourse for the payment of the principal of or premium, if any, or
interest (including Liquidated Damages, if any) on any Security, or for any
claim based thereon or otherwise in respect thereof, shall be had against any
incorporator, shareholder, officer or director, as such, past, present or
future, 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, by the acceptance thereof and as
part of the consideration for the issue thereof, expressly waived and released.


                                   ARTICLE 2

                                 THE SECURITIES

     SECTION 2.1  Title and Terms.

     The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is limited to U.S. $100,000,000 (or $115,000,000
if the over-allotment option set forth in Section 2(b) of the Purchase Agreement
                                                              ------------------
is exercised in full), except for securities authenticated and delivered upon
registration of, transfer of, or in exchange for, or in lieu of other Securities
pursuant to Section 2.5, 2.6, 7.5, 10.8, 11.3 or 12.2.

                                       17
<PAGE>

     The Securities shall be known and designated as the "5 1/4% Convertible
Subordinated Debentures Due 2004" of the Company.  Their Stated Maturity shall
be September 27, 2004 and they shall bear interest from September 27, 1999,
payable semiannually in arrears on March 27 and September 27 in each year,
commencing March 27, 2000, at the rate of 5 1/4% per annum until the principal
thereof is paid or made available for payment.

     The principal of and premium, if any, and interest (including Liquidated
Damages, if any) on the Securities shall be payable as provided in the form of
Security set forth in Exhibit A hereto (any city in which any Paying Agent is
located being herein called a "Place of Payment").

     The Securities shall be redeemable at the option of the Company, and shall
have a Repurchase Right exercisable at the option of Holders, as provided in the
form of Security set forth in Exhibit A hereto and in Articles 10 and 11.

     The Securities shall be convertible as provided in Article 12 (any city in
which any Conversion Agent is located being herein called a "Place of
Conversion").

     The Securities shall be subordinated in right of payment to Senior Debt of
the Company as provided in Article 13.

     SECTION 2.2  Form of Securities.

     The Securities and the Trustee's certificate of authentication to be borne
by such Securities shall be substantially in the form set forth in Exhibit A,
which is incorporated in and made a part of this Indenture.

     Any of the Securities may have such letters, numbers or other marks of
identification and such notations, legends and endorsements as the officers
executing the same may approve (execution thereof to be conclusive evidence of
such approval) and as are not inconsistent with the provisions of this
Indenture, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any
securities exchange or automated quotation system on which the Securities may be
listed or designated for issuance, or to conform to usage.

     Securities offered and sold in their initial distribution in reliance on
Rule 144A shall be issued in the form of one or more Global Securities
(collectively, the "Global Security") in fully registered form without interest
coupons, substantially in the form of Security set forth in Exhibit A, with such
applicable legends as are provided for in Section 2.5 and Exhibit A.  Such
Global Security shall be registered in the name of the

                                       18
<PAGE>

Depositary or Cede & Co., as nominee of the Depositary, and deposited with the
Custodian, duly executed by the Company and authenticated by the Trustee as
hereinafter provided.

     The terms and provisions contained in the form of Security attached as
Exhibit A hereto shall constitute, and is hereby expressly made, a part of this
Indenture and to the extent applicable, the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.

     SECTION 2.3  Denominations.

     The definitive Securities shall be issuable in fully registered form,
without coupons, in denominations of U.S. $1,000 or integral multiples of U.S.
$1,000 in excess thereof, except that Securities offered other than to QIBs will
be issued only in definitive certificated form in integral multiples of $1,000.
Such Securities (i.e. Securities sold to Accredited Investors) will be subject
                 - -
to restrictions in accordance with a form of Letter for Accredited Investors
(the "AI Letter"), that such investors will be required to sign, the form of
which is attached hereto as Exhibit B.

     SECTION 2.4  Execution, Authentication, Delivery and Dating.

     The Securities shall be executed on behalf of the Company by its Chairman
of the Board, its Chief Executive Officer, its President or one of its Vice
Presidents, under a facsimile of its corporate seal reproduced thereon attested
by its Secretary or one of its Assistant Secretaries.  Any such signature may be
manual or facsimile.

     Securities bearing the manual or facsimile signature of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.

     At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities executed by the Company to the
Trustee for authentication, together with a Company Order for the authentication
and delivery of such Securities, and the Trustee in accordance with such Company
Order shall authenticate and deliver such Securities as in this Indenture
provided and not otherwise.

     Each Security shall be dated the date of its authentication.

                                       19
<PAGE>

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

     SECTION 2.5  Registration, Registration of Transfer and Exchange;
Restrictions on Transfer.

     (a) The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities.  The Trustee is
hereby appointed "Security Registrar" for the purpose of registering Securities
and transfers of Securities as herein provided.

     Upon surrender for registration of transfer of any Security at any office
or agency of the Company designated pursuant to Section 9.2 for such purpose,
the Company shall execute, and the Trustee shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new Securities
of any authorized denominations and of a like aggregate principal amount and
bearing such restrictive legends as may be required by this Indenture.

     Subject to the other provisions of this Section 2.5(a), Securities may be
exchanged for other Securities of any authorized denominations and of a like
aggregate principal amount, upon surrender of the Securities to be exchanged at
any such office or agency.  Whenever any Securities are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive, bearing registration numbers not contemporaneously outstanding.

     All Securities issued upon any registration of 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 registration of transfer or exchange.

     None of the Company, the Trustee nor the Security Registrar shall be
required to exchange or register a transfer of (i) any Securities for a period
of fifteen (15) days next preceding any selection of Securities to be redeemed
or (ii) any Securities called for redemption or, if a portion of any Security is
selected or called for redemption, such

                                       20
<PAGE>

portion thereof selected or called for redemption or (iii) any Securities
surrendered for conversion or, if a portion of any Security is surrendered for
conversion, such portion thereof surrendered for conversion.

     Every Security presented or surrendered for registration of transfer or for
exchange shall (if so required by the Company or the Trustee) be duly endorsed
by, or be accompanied by a written instrument of transfer in form satisfactory
to the Company and the Security Registrar and duly executed by, the Holder
thereof or such Holder's attorney duly authorized in writing, together with any
documentation required to be delivered pursuant to Section 2.5(b).

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

     (b)  Notwithstanding any other provisions of this Indenture or the
Securities (but subject to Section 2.2), transfers of a Global Security, in
whole or in part, transfers and exchanges of interests therein of the kinds
described in clauses (2), (3) and (4) below shall be made only in accordance
with this Section 2.5(b).  Transfers and exchanges subject to this Section 2.5
shall also be subject to the other provisions of this Indenture that are not
inconsistent with this Section 2.5.

          (1) Limitation on Transfers of a Global Security.  A Global Security
              --------------------------------------------
     may not be transferred, in whole or in part, to any Person other than the
     Depositary or a nominee thereof, and no such transfer to any such other
     Person may be registered; provided that this clause (1) shall not prohibit
     any transfer of a Security that is issued in exchange for a Global Security
     but is not itself a Global Security.  No transfer of a Security to any
     Person shall be effective under this Indenture or the Securities unless and
     until such Security has been registered in the name of such Person.
     Nothing in this Section 2.5(b)(1) shall prohibit or render ineffective any
     transfer of a beneficial interest in a Global Security effected in
     accordance with the other provisions of this Section 2.5(b).

          (2) Global Security to Global Security.  If the holder of a beneficial
              ----------------------------------
     interest in the Global Security wishes at any time to transfer such
     interest to a Person who wishes to take delivery thereof in such form, such
     transfer may be effected only in accordance with the applicable procedures
     of the Depositary.

          (3) Exchanges.  In the event that a Global Security or any portion
              ---------
     thereof is exchanged for Securities other than Global Securities, such
     Securities may in turn be exchanged (on transfer or otherwise) for
     Securities that are not

                                       21
<PAGE>

     Global Securities or for beneficial interests in a Global Security (if any
     is then outstanding) only in accordance with such procedures, which shall
     be substantially consistent with the provisions of clauses (1) and (2)
     above (including the certification requirements intended to insure that the
     transfers and exchanges of beneficial interests in a Global Security comply
     with Rule 144A or Rule 144, as the case may be) and any applicable
     procedures, as may be from time to time adopted by the Company and the
     Trustee.

          (4) Securities Originally Issued to Accredited Investors.  Securities
              ----------------------------------------------------
     may be issued other than in reliance on Rule 144A, and such Securities will
     be issued only in definitive certificated form and, initially, only in
     integral multiples of $1,000.  Such Securities (i.e., Securities sold to
                                                     - -
     Accredited Investors) will be subject to restrictions on transfer in
     accordance with the AI Letter.  Furthermore, in case a Security held by an
     Accredited Investor is to be transferred (whether during or after the
     period of restriction) in a transaction exempt pursuant to Rule 144A, then
     the transferor shall deliver a certificate substantially in the form of
     Exhibit C hereto, with such changes in the second paragraph thereof as are
     appropriate to reflect the facts and circumstances, including that the
     Holder will be transferring a Security in the form of a definitive
     registered certificate.  (However, a transfer or exchange that does not
     involve any change in beneficial ownership shall not be considered to be a
     transfer that triggers these certification requirements.)  The Company may
     vary these procedures or impose other reasonable procedures to ensure
     compliance with the agreement of such Holder contained in its AI Letter.

     (c) Each Restricted Security and Global Security issued hereunder shall,
upon issuance, bear the legends required by Section 2.5(e) to be applied and
such required legends shall not be removed except as provided in the next
sentence or paragraph (d) of this Section 2.5.  The legend required for a
Restricted Security may be removed if there is delivered to the Company such
satisfactory evidence, which may include an opinion of independent counsel
licensed to practice law in the United States, as may be reasonably required by
the Company that neither such legend nor the restrictions on transfer set forth
therein are required to ensure that transfers of such Security will not violate
the registration requirements of the Securities Act.  Upon provision of such
satisfactory evidence, the Trustee, at the written direction of the Company,
shall authenticate and deliver in exchange for such Securities another Security
or Securities having an equal aggregate principal amount that does not bear such
legend.  If such a legend required for a Restricted Security has been removed
from a Security as provided above, no other Security issued in exchange for all
or any part of such Security shall bear such legend, unless the Company has
reasonable cause to believe that such other Security is a

                                       22
<PAGE>

"restricted security" within the meaning of Rule 144 and instructs the Trustee
in writing to cause a legend to appear thereon.

     (d)  The provisions of clauses (1), (2), (3) and (4) below shall apply only
to Global Securities:

          (1)  Each Global Security authenticated under this Indenture shall be
     registered in the name of the Depositary or a nominee thereof, and
     delivered to such Depositary or a nominee thereof or custodian therefor,
     and each such Global Security shall constitute a single Security for all
     purposes of this Indenture.

          (2)  Notwithstanding any other provision in this Indenture or the
     Securities, no Global Security may be exchanged in whole or in part for
     Securities registered, and no transfer of a Global Security in whole or in
     part may be registered, in the name of any Person other than the Depositary
     or a nominee thereof unless (A) the Depositary (i) has notified the Company
     that it is unwilling or unable to continue as Depositary for such Global
     Security or (ii) has ceased to be a clearing agency registered under the
     Exchange Act, (B) there shall have occurred and be continuing an Event of
     Default with respect to such Global Security or (C) a request for
     certificates has been made upon the Trustee in accordance with the
     Depositary's customary procedures and a copy of such notice has been
     received by the Company from the Trustee.  Any Global Security exchanged
     pursuant to clause (A) above shall be so exchanged in whole or in part and
     any Global Security exchanged pursuant to clause (B) or (C) above may be
     exchanged in whole or from time to time in part as directed by the
     Depositary.  Any Security issued in exchange for a Global Security or any
     portion thereof shall be a Global Security, provided that any Security so
     issued that is registered in the name of a Person other than the Depositary
     or a nominee thereof shall not be a Global Security.

          (3)  Securities issued in exchange for a Global Security or any
     portion thereof pursuant to clause (2) above shall be issued in definitive,
     fully registered form, without interest coupons, shall have an aggregate
     principal amount equal to that of such Global Security or portion thereof
     to be so exchanged, shall be registered in such names and be in such
     authorized denominations as the Depositary shall designate and shall bear
     any legends required hereunder. Any Global Security to be exchanged in
     whole shall be surrendered by the Depositary to the Trustee, as Security
     Registrar. With regard to any Global Security to be exchanged in part,
     either such Global Security shall be so surrendered for exchange or, if the
     Trustee is acting as custodian for the Depositary or its nominee with
     respect to such Global Security, the principal amount thereof shall be

                                       23
<PAGE>

     reduced, by an amount equal to the portion thereof to be so exchanged, by
     means of an appropriate adjustment made on the records of the Trustee. Upon
     any such surrender or adjustment, the Trustee shall authenticate and make
     available for delivery the Security issuable on such exchange to or upon
     the written order of the Depositary or an authorized representative
     thereof.

          (4)  In the event of the occurrence of any of the events specified in
     clause (2) above, the Company will promptly make available to the Trustee a
     reasonable supply of certificated Securities in definitive, fully
     registered form, without interest coupons.

          (5)  Neither any members of, or participants in, the Depositary
     ("Agent Members") nor any other Persons on whose behalf Agent Members may
     act shall have any rights under this Indenture with respect to any Global
     Security, or under any Global Security, and the Depositary or such nominee,
     as the case may be, may be treated by the Company, the Trustee and any
     agent of the Company or the Trustee as the absolute owner and holder of
     such Global Security for all purposes whatsoever. Notwithstanding the
     foregoing, nothing herein shall prevent the Company, the Trustee or any
     agent of the Company or Trustee from giving effect to any written
     certification, proxy or other authorization furnished by the Depositary or
     such nominee, as the case may be, or impair, as between the Depositary, its
     Agent Members and any other person on whose behalf an Agent Member may act,
     the operation of customary practices of such Persons governing the exercise
     of the rights of a holder of any Security.

     (e)  Every Security that bears or is required under this Section 2.5(e) to
bear the legend set forth in this Section 2.5(e) (together with any Common Stock
issued upon conversion of the Securities and required to bear the legend set
forth in Section 2.5(f), collectively, the "Restricted Securities") shall be
subject to the restrictions on transfer set forth in this Section 2.5(e)
(including the legend set forth below), unless such restrictions on transfer
shall be waived by written consent of the Company, and the Holder of each such
Restricted Security, by such Holder's acceptance thereof, agreed to be bound by
all such restrictions on transfer.  As used in Sections 2.5(e) and 2.5(f), the
term "transfer" encompasses any sale, pledge, transfer or other disposition
whatsoever of any Restricted Security.

     Until two (2) years after the original issuance date of any Security, any
certificate evidencing such Security (and all securities issued in exchange
therefor or substitution thereof, other than Common Stock, if any, issued upon
conversion thereof which shall bear the legend set forth in Section 2.5(f), if
applicable) shall bear a legend in

                                       24
<PAGE>

substantially the following form (unless such Securities have been transferred
pursuant to a registration statement that has been declared effective under the
Securities Act (and which continues to be effective at the time of such
transfer) or unless otherwise agreed by the Company in writing, with written
notice thereof to the Trustee):

     THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S.
     SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
     SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR
     TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN
     THE FOLLOWING SENTENCE.  BY ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
     THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A
     UNDER THE SECURITIES ACT) OR (B) IT IS AN "ACCREDITED INVESTOR" (AS DEFINED
     IN RULE 501(a)(1), (2), (3), (5), (6) OR (7) UNDER THE SECURITIES ACT
     ("ACCREDITED INVESTOR"); (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER
     THE ORIGINAL ISSUANCE OF THE SECURITY EVIDENCED HEREBY RESELL OR OTHERWISE
     TRANSFER THE SECURITY EVIDENCED HEREBY OR THE COMMON STOCK ISSUABLE UPON
     CONVERSION OF SUCH SECURITY EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY
     THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN
     COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED
     STATES TO AN ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES TO
     BANKERS TRUST COMPANY, AS TRUSTEE, A SIGNED LETTER CONTAINING CERTAIN
     REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF
     THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE OBTAINED
     FROM SUCH TRUSTEE; (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED
     BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), OR (E) PURSUANT TO A
     REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
     SECURITIES ACT (AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH
     TRANSFER); AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE
     SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO
     CLAUSE 2(E) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.  IN
     CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY WITHIN TWO
     YEARS AFTER THE

                                       25
<PAGE>

     ORIGINAL ISSUANCE OF SUCH SECURITY (OTHER THAN A TRANSFER PURSUANT TO
     CLAUSE 2(E) ABOVE), THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON
     THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
     CERTIFICATE TO BANKERS TRUST COMPANY, AS TRUSTEE (OR ANY SUCCESSOR TRUSTEE,
     AS APPLICABLE). IF THE PROPOSED TRANSFER IS PURSUANT TO CLAUSE 2(C) OR 2(D)
     ABOVE, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO BANKERS TRUST
     COMPANY, AS TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
     CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE COMPANY MAY
     REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO
     AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
     REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED UPON THE
     EARLIER OF THE TRANSFER OF THE SECURITY EVIDENCED HEREBY PURSUANT TO CLAUSE
     2(E) ABOVE OR THE EXPIRATION OF TWO YEARS FROM THE ORIGINAL ISSUANCE OF THE
     SECURITY EVIDENCED HEREBY. AS USED HEREIN, THE TERMS "UNITED STATES" AND
     "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
     SECURITIES ACT.

     Any Security (or security issued in exchange or substitution thereof) as to
which such restrictions on transfer shall have expired in accordance with their
terms or as to which the conditions for removal of the foregoing legend as set
forth therein have been satisfied may, upon surrender of such Security for
exchange to the Security Registrar in accordance with the provisions of this
Section 2.5, be exchanged for a new Security or Securities, of like tenor and
aggregate principal amount, which shall not bear the restrictive legend required
by this Section 2.5(e).

     The Depositary shall be a clearing agency registered under the Exchange
Act.  The Company initially appoints The Depository Trust Company to act as
Depositary with respect to the Global Securities.  Initially, the Global
Securities shall be issued to the Depositary, registered in the name of Cede &
Co., as the nominee of the Depositary, and deposited with the Trustee as
Custodian for Cede & Co.

     If at any time the Depositary for a Global Security notifies the Company
that it is unwilling or unable to continue as Depositary for a Global Security,
the Company may appoint a successor Depositary with respect to such Global
Security.  If a successor Depositary for a Global Security is not appointed by
the Company within ninety

                                       26
<PAGE>

(90) days after the Company receives such notice, the Company will execute, and
the Trustee, upon receipt of an Officers' Certificate for the authentication and
delivery of Securities, will authenticate and deliver, Securities in
certificated form, in an aggregate principal amount equal to the principal
amount of the Global Security in exchange for such Global Security and upon
delivery of such Global Security to the Trustee such Global Security shall be
canceled.

     Securities in certificated form issued in exchange for all or a part of a
Global Security pursuant to this Section 2.5 shall be registered in such names
and in such authorized denominations as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct the
Trustee.  Upon execution and authentication, the Trustee shall deliver such
Securities in certificated form to the persons in whose names such Securities in
certificated form are so registered.

     At such time as all interests in a Global Security have been redeemed,
converted, canceled, repurchased or transferred, such Security in global form
shall be, upon receipt thereof, canceled by the Trustee in accordance with
standing procedures and instructions existing between the Depositary and the
Custodian.  At any time prior to such cancellation, if any interest in a Global
Security is exchanged for Securities in certificated form, redeemed, converted,
canceled, repurchased or transferred to a transferee who receives Securities in
certificated form therefor or any Security in certificated form is exchanged or
transferred for part of a Global Security, the principal amount of such Global
Security shall, in accordance with the standing procedures and instructions
existing between the Depositary and the Custodian, be appropriately reduced or
increased, as the case may be, and a notation shall be made on the records of
Trustee, by the Trustee or the Custodian, at the direction of the Trustee, to
reflect such reduction or increase.

     (f) Until two (2) years after the original issuance date of any Security,
any stock certificate representing Common Stock issued upon conversion of such
Security shall bear a legend in substantially the following form (unless such
Common Stock has been sold pursuant to a registration statement that has been
declared effective under the Securities Act (and which continues to be effective
at the time of such transfer) or such Common Stock has been issued upon
conversion of Securities that have been transferred pursuant to a registration
statement that has been declared effective under the Securities Act or unless
otherwise agreed by the Company with written notice thereof to the Trustee and
any transfer agent for the Common Stock):

     THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S.
     SECURITIES ACT OF 1933, AS AMENDED (THE

                                       27
<PAGE>

     "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED OR
     SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
     PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. THE HOLDER HEREOF
     AGREES THAT UNTIL THE EXPIRATION OF TWO YEARS AFTER THE ORIGINAL ISSUANCE
     OF THE SECURITY UPON THE CONVERSION OF WHICH THE COMMON STOCK EVIDENCED
     HEREBY WAS ISSUED, (1) IT WILL NOT RESELL OR OTHERWISE TRANSFER THE COMMON
     STOCK EVIDENCED HEREBY EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF,
     (B) INSIDE THE UNITED STATES TO A "QUALIFIED INSTITUTIONAL BUYER" (AS
     DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (C) INSIDE THE UNITED
     STATES TO AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3),
     (5), (6) OR (7) UNDER THE SECURITIES ACT) THAT PRIOR TO SUCH TRANSFER,
     FURNISHES TO AMERICAN STOCK TRANSFER AND TRUST COMPANY, AS TRANSFER AGENT,
     A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING
     TO THE RESTRICTIONS ON TRANSFER OF THE COMMON STOCK EVIDENCED HEREBY (THE
     FORM OF WHICH LETTER CAN BE OBTAINED FROM SUCH TRANSFER AGENT) (D) PURSUANT
     TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
     SECURITIES ACT (IF AVAILABLE), OR (E) PURSUANT TO A REGISTRATION STATEMENT
     WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH
     CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER); (2) PRIOR TO ANY
     SUCH TRANSFER (OTHER THAN A TRANSFER PURSUANT TO CLAUSE 1(E) ABOVE), IT
     WILL FURNISH TO AMERICAN STOCK TRANSFER AND TRUST COMPANY, AS TRANSFER
     AGENT, (OR ANY SUCCESSOR TRANSFER AGENT, AS APPLICABLE), SUCH
     CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE COMPANY MAY
     REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO
     AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
     REQUIREMENTS OF THE SECURITIES ACT; AND (3) IT WILL DELIVER TO EACH PERSON
     TO WHOM THE COMMON STOCK EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A
     TRANSFER PURSUANT TO A CLAUSE 1(E) ABOVE) A NOTICE SUBSTANTIALLY TO THE
     EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF THE
     TRANSFER OF THE COMMON STOCK EVIDENCED HEREBY PURSUANT TO CLAUSE 1(E) ABOVE
     OR THE EXPIRATION OF TWO YEARS FROM THE ORIGINAL ISSUANCE OF THE

                                       28
<PAGE>

     SECURITY UPON THE CONVERSION OF WHICH THE COMMON STOCK EVIDENCED HEREBY WAS
     ISSUED. AS USED HEREIN, THE TERMS "UNITED STATES" AND "U.S. PERSON" HAVE
     THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.

     Any such Common Stock as to which such restrictions on transfer shall have
expired in accordance with their terms or as to which the conditions for removal
of the foregoing legend as set forth therein have been satisfied may, upon
surrender of the certificates representing such shares of Common Stock for
exchange in accordance with the procedures of the transfer agent for the Common
Stock, be exchanged for a new certificate or certificates for a like aggregate
number of shares of Common Stock, which shall not bear the restrictive legend
required by this Section 2.5(f).

     (g)  Any certificate evidencing a Security that has been transferred to an
Affiliate of the Company within two years after the original issuance date of
the Security, as evidenced by a notation on the Assignment Form for such
transfer or in the representation letter delivered in respect thereof, for so
long as such Security is held by such Affiliate, shall, until two years after
the last date on which the Company or any Affiliate of the Company was an owner
of such Security, in each case, bear a legend in substantially the following
form, unless otherwise agreed by the Company (with written notice thereof to the
Trustee):

     THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S.
     SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND,
     ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR
     THE ACCOUNT TO BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE
     FOLLOWING SENTENCE.  BY ITS ACQUISITION HEREOF, THE HOLDER AGREES (1) THAT
     IT WILL NOT RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY OR
     THE COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH SECURITY EXCEPT (A) TO
     THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) IN A TRANSACTION REGISTERED
     UNDER THE SECURITIES ACT OR (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION
     PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) AND (2) THAT
     IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS
     TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.  THIS
     LEGEND SHALL BE REMOVED UPON THE TRANSFER OF THE SECURITY EVIDENCED HEREBY
     OR THE COMMON STOCK ISSUABLE UPON

                                       29
<PAGE>

     CONVERSION OF SUCH SECURITY PURSUANT TO THE IMMEDIATELY PRECEDING SENTENCE.
     IF THE PROPOSED TRANSFER IS PURSUANT TO THE EXEMPTION FROM REGISTRATION
     PROVIDED BY RULE 144 UNDER THE SECURITIES ACT, THE HOLDER MUST, PRIOR TO
     SUCH TRANSFER, FURNISH TO BANKERS TRUST COMPANY, AS TRUSTEE (OR ANY
     SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH CERTIFICATIONS, LEGAL OPINIONS OR
     OTHER INFORMATION AS THE COMPANY MAY REASONABLY REQUIRE TO CONFIRM THAT
     SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A
     TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
     ACT. AS USED HEREIN, THE TERMS "UNITED STATES" AND "U.S. PERSON" HAVE THE
     MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.

Any stock certificate representing Common Stock issued upon conversion of such
Security shall also bear a legend in substantially the form indicated above,
unless otherwise agreed by the Company (with written notice thereof to the
Trustee).

     (h)  Notwithstanding any provision of Section 2.5 to the contrary, in the
event Rule 144(k) as promulgated under the Securities Act (or any successor
rule) is amended to shorten the two-year period under Rule 144(k) (or the
corresponding period under any successor rule), from and after receipt by the
Trustee of the Officers' Certificate and Opinion of Counsel provided for by this
Section 2.5(h), (i) the references in the first sentence of the second paragraph
of Section 2.5(e) to "two (2) years" and in the restrictive legend set forth in
such paragraph to "TWO YEARS" shall be deemed for all purposes hereof to be
references to such shorter period, (ii) the references in the first paragraph of
Section 2.5(f) to "two (2) years" and in the restrictive legend set forth in
such paragraph to "TWO YEARS" shall be deemed for all purposes hereof to be
references to such shorter period and (iii) all corresponding references in the
Securities and the restrictive legends on the Restricted Securities shall be
deemed for all purposes hereof to be references to such shorter period, provided
that such changes shall not become effective if they are otherwise prohibited
by, or would otherwise cause a violation of, the then-applicable federal
securities laws.  As soon as practicable after the Company has knowledge of the
effectiveness of any such amendment to shorten the two-year period under Rule
144(k) (or the corresponding period under any successor rule), unless such
changes would otherwise be prohibited by, or would otherwise cause a violation
of, the then-applicable securities law, the Company shall provide to the Trustee
an Officers' Certificate and Opinion of Counsel informing the Trustee of the
effectiveness of such amendment and the effectiveness of the foregoing changes
to Sections 2.5(e) and 2.5(f) and the restrictive legends on the Restricted
Securities.  The

                                       30
<PAGE>

provisions of this Section 2.5(h) will not be effective until such time as the
Opinion of Counsel and Officer's Certificate have been received by the Trustee
hereunder. This Section 2.5(h) shall apply to successive amendments to Rule
144(k) (or any successor rule) shortening the holding period thereunder.

     SECTION 2.6  Mutilated, Destroyed, Lost or Stolen Securities.

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

     If there be delivered to the Company and the Trustee

          (1)  evidence to their satisfaction of the destruction, loss or theft
     of any Security, and

          (2) such security or indemnity as may be required by them to save each
     of them and any agent of either of them harmless,

then, in the absence of notice to the Company or the Trustee that such Security
has been acquired by a bona fide purchaser, the Company shall execute and upon
request the Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Security, a new Security of like tenor and principal
amount and bearing a number not contemporaneously outstanding.

     In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion, but
subject to any conversion rights, may, instead of issuing a new Security, pay
such Security, upon satisfaction of the condition set forth in the preceding
paragraph.

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

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

                                       31
<PAGE>

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

     SECTION 2.7  Payment of Interest, Interest Rights Preserved.

     Interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest.

     Any interest on any Security 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 Holder on the relevant
Regular Record Date by virtue of having been such Holder, and such Defaulted
Interest may be paid by the Company, at its election in each case, as provided
in clause (1) or (2) below:

          (1) The Company may elect to make payment of any Defaulted Interest to
     the Persons in whose names the Securities (or their respective Predecessor
     Securities) are registered at the close of business on a Special Record
     Date for the payment of such Defaulted Interest, which shall be fixed in
     the following manner. The Company shall notify the Trustee in writing of
     the amount of Defaulted Interest proposed to be paid on each Security and
     the date of the proposed payment, and at the same time the Company shall
     deposit with the Trustee an amount of money equal to the aggregate amount
     proposed to be paid in respect of such Defaulted Interest or shall make
     arrangements satisfactory to the Trustee for such deposit prior to the date
     of the proposed payment, such money when deposited to be held in trust for
     the benefit of the Persons entitled to such Defaulted Interest as in this
     clause provided. Thereupon the Trustee shall fix a Special Record Date of
     the payment of such Defaulted Interest which shall be not more than 15 days
     and not less than 10 days prior to the date of the proposed payment and not
     less than 10 days after the receipt by the Trustee of the notice of the
     proposed payment. The Trustee shall promptly notify the Company of such
     Special Record Date and, in the name and at the expense of the Company,
     shall cause notice of the proposed payment of such Defaulted Interest and
     the Special Record Date therefor to be mailed, first-class postage prepaid
     (by airmail in the case of any notice sent to an address outside the United
     States), to each Holder of Securities at the address of such Holder as it
     appears in the Security Register, not less than 10 days prior to such
     Special Record Date. Notice of the proposed payment of such Defaulted
     Interest and the Special Record Date therefor having

                                       32
<PAGE>

     been so mailed, such Defaulted Interest shall be paid to the Persons
     in whose names the Securities (or their respective Predecessor Securities)
     are registered at the close of business on such Special Record Date and
     shall no longer be payable pursuant to the following clause (2).

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

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

     The person in whose name any Security (or its Predecessor Security) is
registered at the close of business on any Record Date (including any Security
that is converted after the Record Date and on or before the relevant Interest
Payment Date) shall be entitled to receive the interest payable on such Interest
Payment Date notwithstanding the cancellation of such Security upon any
transfer, exchange or conversion subsequent to the Record Date and on or prior
to such Interest Payment Date; provided that in the case of any Security, or
portion thereof, called for redemption pursuant to Article 10 on a Redemption
Date or repurchased by the Company pursuant to Article 11 on a repurchase date
during the period from the close of business on the Record Date to the close of
business on the Business Day next preceding the following Interest Payment Date,
interest shall not be paid to the person in whose name the Security, or portion
thereof, is registered on the close of business of such Record Date, and the
Company shall have no obligation to pay interest on such Security or portion
thereof except to the extent required to be paid upon such redemption or
repurchase in accordance with Article 10 or Article 11.

     In the case of any Security which is converted after any Regular Record
Date and on or prior to the next succeeding Interest Payment Date (other than
any Security whose Maturity is prior to such Interest Payment Date), the Holder
of such Security shall be required to make a payment to the Company in an amount
equal to the interest payable on such Interest Payment Date on the principal
amount of the Security so converted.  Interest on the principal amount of such
Security shall be payable on such Interest Payment Date notwithstanding such
conversion, and such interest (whether or not punctually paid or

                                       33
<PAGE>

duly provided for) shall be paid to the Person in whose name that Security (or
one or more Predecessor Securities) is registered at the close of business on
such Regular Record Date.

     SECTION 2.8  Persons Deemed Owners.

     The Company, the Trustee and any agent of the Company or the Trustee may
treat the registered Holder of the Global Security as the absolute owner of such
Security for the purpose of receiving payment thereof or on account thereof and
for all other purposes whatsoever, whether or not such Security be overdue, and
notwithstanding any notice of ownership or writing thereon, or any notice of
previous loss or theft or other interest therein.  The Company, the Trustee and
any agent of the Company or the Trustee may treat the Person in whose name any
Security is registered as the owner of such Security for the purpose of
receiving payment of principal of and premium, if any, and (subject to Section
2.7) interest (including Liquidated Damages, if any) on such Security and for
all other purposes whatsoever, whether or not such Security be overdue, and
notwithstanding any notice of ownership or writing thereon, or any notice of
previous loss or theft or other interest therein.

     SECTION 2.9  Cancellation.

     All securities surrendered for payment, redemption, repurchase, conversion,
registration of transfer or exchange shall, if surrendered to any Person other
than the Trustee, be delivered to the Trustee.  All Securities so delivered
shall be canceled promptly by the Trustee, and no Securities shall be issued in
lieu thereof except as expressly permitted by any of the provisions of this
Indenture.  Upon written instructions of the Company, the Trustee shall destroy
canceled Securities and, after such destruction, shall deliver a certificate of
such destruction to the Company.  If the Company shall acquire any of the
Securities, such acquisition shall not operate as a redemption or satisfaction
of the indebtedness represented by such Securities unless and until the same are
delivered to the Trustee for cancellation.

     SECTION 2.10  Computation of Interest.

     Interest shall be calculated on the basis of a 360-day year.  Whenever it
is necessary to compute an amount of interest in respect of any Security for a
period of less than a full year, such interest shall be calculated on the basis
of a 360-day year consisting of 12 months of 30 days each and, in the case of an
incomplete month, the number of days elapsed out of 30 days.

                                       34
<PAGE>

     SECTION 2.11  Temporary Securities.

     Pending the preparation of Securities in certificated form, the Company may
execute and the Trustee or an Authenticating Agent shall, upon written request
of the Company, authenticate and deliver temporary Securities (printed or
lithographed).  Temporary Securities shall be issuable in any authorized
denomination, and substantially in the form of the Securities in certified form
but with such omissions, insertions and variations as may be appropriate for
temporary Securities, all as may be determined by the Company.  Every such
temporary Security shall be executed by the Company and authenticated by the
Trustee or the Authenticating Agent upon the same conditions and in
substantially the same manner, and with the same effect, as the Securities in
certificated form.  Without unreasonable delay the Company will execute and
deliver to the Trustee or the Authenticating Agent Securities in certified form
(other than in the case of Securities in global form) and thereupon any or all
temporary Securities (other than any such Securities in global form) may be
surrendered in exchange therefor, at each office or agency maintained by the
Company pursuant to Section 9.2 and the Trustee or the Authenticating Agent
shall authenticate and deliver in exchange for such temporary Securities an
equal aggregate principal amount of Securities in certified form.  Such exchange
shall be made by the Company at its own expense and without any charge therefor.
Until so exchanged, the temporary Securities shall in all respects be entitled
to the same benefits and subject to the same limitations under this Indenture as
Securities in certificated form authenticated and delivered hereunder.

                                   ARTICLE 3


                           SATISFACTION AND DISCHARGE

     SECTION 3.1  Satisfaction and Discharge of Indenture.

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

          (1)  either

               (A) all Securities theretofore authenticated and delivered (other
          than (i) Securities which have been destroyed, lost or stolen and
          which have been replaced or paid as provided in Section 2.6 and (ii)
          Securities for whose payment money has theretofore been deposited in
          trust or segregated and held in trust by the Company and thereafter
          repaid to the Company or discharged from such trust, as provided in
          Section 10.3), have been delivered to the Trustee for cancellation; or

                                       35
<PAGE>

          segregated and held in trust by the Company and thereafter repaid to
          the Company or discharged from such trust, as provided in Section
          10.3), have been delivered to the Trustee for cancellation; or

               (B) all such Securities not theretofore delivered to the Trustee
          for cancellation (other than Securities referred to in clauses (i) and
          (ii) of clause (1)(A) above)

                 (i)    have become due and payable, or

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

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

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

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

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

     Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 5.7 shall survive and,
if money shall have been deposited with the Trustee pursuant to clause (1)(B) of
this Section, the obligations of the Trustee under Section 3.2 and the last
paragraph of Section 9.3 shall survive.  Funds held in trust pursuant to this
Section are not subject to the provisions of Article 13.

                                       36
<PAGE>

     SECTION 3.2  Application of Trust Money.

     Subject to the provisions of the last paragraph of Section 9.3, all money
deposited with the Trustee pursuant to Section 3.1 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal and premium, if
any, and interest (including Liquidated Damages, if any) for whose payment such
money has been deposited with the Trustee.

     All moneys deposited with the Trustee pursuant to Section 3.1 (and held by
it or any Paying Agent) for the payment of Securities subsequently converted
shall be returned to the Company upon Company Request.

                                   ARTICLE 4

                                   REMEDIES

     SECTION 4.1  Events of Default.

     "Event of Default," where used herein, means any one of the following
events (whatever the reason for such Event of Default and whether it shall be
occasioned by the provisions of Article 13 or be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body):

          (1) there shall be a failure by the Company to pay when due the
     principal of or premium, if any, on any of the Securities at the Stated
     Maturity, upon redemption or exercise of a Repurchase Right or otherwise,
     whether or not such payment is prohibited by Article 13 of this Indenture;
     or

          (2) there shall be a failure by the Company to pay an installment of
     interest (including Liquidated Damages, if any) on any of the Securities
     for 30 days after the date when due, whether or not such payment is
     prohibited by Article 13 of this Indenture; or

          (3) the Company shall fail to perform or observe any other term,
     covenant or agreement contained in the Securities or this Indenture for a
     period of 60 days after written notice of such failure, requiring the
     Company to remedy the same, shall have been given to the Company by the
     Trustee or to the Company

                                       37
<PAGE>

     and the Trustee by the Holders of at least 25% in aggregate principal
     amount of the Outstanding Securities; or

          (4) (a) failure of the Company to make any payment by the end of the
     applicable grace period, if any, after the maturity of any Indebtedness for
     borrowed money in an amount in excess of $1,000,000, or (b) the
     acceleration of Indebtedness for borrowed money in an amount in excess of
     $1,000,000 because of a default with respect to such Indebtedness without
     such Indebtedness having been discharged or such acceleration having been
     cured, waived, rescinded or annulled, in the case of (a) or (b) above, for
     a period of 30 days after written notice to the Company  by the Trustee or
     to the Company and the Trustee by holders of not less than 25% in aggregate
     principal amount of the then Outstanding Securities; or

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

          (6) the commencement by the Company of a voluntary case or proceeding
     under any applicable United States federal or state bankruptcy, insolvency,
     reorganization or other similar law or of any other case or proceeding to
     be adjudicated a bankrupt or insolvent, or the consent by the Company to
     the entry of a decree or order for relief in respect of the Company in an
     involuntary case or proceeding under any applicable United States federal
     or state bankruptcy, insolvency, reorganization or other similar law or to
     the commencement of any bankruptcy or insolvency case or proceeding against
     the Company, or the filing by the Company of a petition or answer or
     consent seeking reorganization or relief under any applicable United States
     federal or state law, or the consent by the Company to the filing of such
     petition or to the appointment of or the taking possession by a custodian,
     receiver, liquidator, assignee, trustee, sequestrator or other similar
     official of the Company or of any substantial part of its property, or

                                       38
<PAGE>

     the making by the Company of an assignment for the benefit of creditors, or
     the admission by the Company in writing of its inability to pay its debts
     generally as they become due, or the taking of corporate action by the
     Company expressly in furtherance of any such action.

     SECTION 4.2  Acceleration of Maturity; Rescission and Annulment.

     If an Event of Default specified in Section 4.1(5) or 4.1(6) occurs and is
continuing, then automatically the principal of all the Securities and the
interest thereon shall become immediately due and payable.  If any other Event
of Default occurs and is continuing, then and in every such case the Trustee or
the Holders of not less than 25% in aggregate principal amount of the
Outstanding Securities may declare the Securities to be due and payable
immediately at their principal amount together with accrued interest, by a
notice in writing to the Company (and to the Trustee if given by the Holders),
and upon any such declaration such principal amount and accrued interest shall
become immediately due and payable.

     At any time after an acceleration and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Securities (or such lesser amount as shall have acted at a meeting
pursuant to the provisions of this Indenture), by written notice to the Company
and the Trustee, may rescind and annul such acceleration and its consequences
if:

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

               (A) all overdue interest (including Liquidated Damages, if any)
          on all Securities,

               (B) the principal of and premium, if any, on any Securities which
          has become due otherwise than by such declaration of acceleration and
          interest thereon at the rate borne by the Securities,

               (C) to the extent that payment of such interest is lawful,
          interest upon overdue interest (including Liquidated Damages, if any)
          at the rate borne by the Securities, and

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

                                       39
<PAGE>

          (2) all Events of Default, other than the non-payment of the principal
     of Securities which have become due solely by such acceleration, have been
     cured or waived as provided in Section 4.13;

provided, however, that in the event such declaration of acceleration has been
made based on the existence of an Event of Default under Section 4.1(4) and such
Event of Default has been remedied, cured or waived, then without any further
action by the Holders such declaration of acceleration shall be rescinded
automatically and the consequences of such declaration shall be annulled.

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

     SECTION 4.3  Collection of Indebtedness and Suits for Enforcement by the
Trustee.

     The Company covenants that if

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

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

the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable (as expressed
therein or as a result of any acceleration effected pursuant to Section 4.2) on
such Securities for principal and premium, if any, and interest (including
Liquidated Damages, if any) and, to the extent that payment of such interest
shall be legally enforceable, interest on any overdue principal and premium, if
any, and on any overdue interest (including Liquidated Damages, if any), at the
rate borne by the Securities, and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.

     If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company

                                       40
<PAGE>

and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company, wherever situated.

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

     SECTION 4.4  Trustee May File Proofs of Claim.

     In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or the property of the Company or
its creditors, the Trustee (irrespective of whether the principal of the
Securities 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
on the Company for the payment of overdue principal or interest) shall be
entitled and empowered, by intervention in such proceeding or otherwise,

          (1) to file and prove a claim for the whole amount of principal and
     premium, if any, and interest (including Liquidated Damages, if any) owing
     and unpaid in respect of the Securities 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 claim for the reasonable compensation, expenses,
     disbursements and advances of the Trustee, its agents and counsel) and of
     the Holders of Securities allowed in such judicial proceeding, and

          (2) to collect and receive any moneys or other property payable or
     deliverable on any such claim and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceedings is hereby authorized by
each Holder of Securities to make such payments to the Trustee and, in the event
that the Trustee shall consent to the making of such payments directly to the
Holders of Securities, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel and any other amounts due the Trustee under Section 5.7.

                                       41
<PAGE>

     Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept, or adopt on behalf of any Holder of a
Security, any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to authorize the
Trustee to vote in respect of the claim of any Holder of a Security in any such
proceeding.

     SECTION 4.5  Trustee May Enforce Claims Without Possession of Securities.

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

     SECTION 4.6  Application of Money Collected.

     Subject to Article 13, any money collected by the Trustee pursuant to this
Article shall be applied in the following order, at the date or dates fixed by
the Trustee and, in case of the distribution of such money on account of
principal or premium, if any, or interest (including Liquidated Damages, if
any), upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:

          FIRST:  To the payment of all amounts due the Trustee under Section
     5.7 hereof, including payment of all the fees, expenses and indemnities of
     the Trustee and the fees and expenses of its counsel;

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

          THIRD:  Any remaining amounts shall be repaid to the Company.

                                       42
<PAGE>

     SECTION 4.7  Limitation on Suit.

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

          (1) such Holder has previously given written notice to the Trustee of
     a continuing Event of Default;

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

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

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

          (5) no direction inconsistent with such written request has been given
     to the Trustee during such 60-day period by the Holders of a majority in
     aggregate principal amount of the Outstanding Securities (or such amount as
     shall have acted at a meeting pursuant to the provisions of this
     Indenture);

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

     SECTION 4.8  Unconditional Right of Holders to Receive Principal, Premium
and Interest and To Convert.

     Notwithstanding any other provision in this Indenture, the Holder of any
Security (other than the Temporary Global Security) shall have the right, which
is absolute and unconditional, to receive payment of the principal of and
premium, if any, and (subject to Section 2.7) interest (including Liquidated
Damages, if any) on such Security on the Stated Maturity expressed in such
Security (or, in the case of redemption or exercise of a

                                       43
<PAGE>

Repurchase Right, on the Redemption Date) and to convert such Security in
accordance with Article 12, and to institute suit for the enforcement of any
such payment and right to convert, and such rights shall not be impaired without
the consent of such Holder.

     SECTION 4.9  Restoration of Rights and Remedies.

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

     SECTION 4.10  Rights and Remedies Cumulative.

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

     SECTION 4.11  Delay or Omission Not Waiver.

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

     SECTION 4.12  Control by Holders of Securities.

     The Holders of a majority in aggregate principal amount of the Outstanding
Securities (or such lesser amount as shall have acted as a meeting pursuant to
the provisions of this Indenture) shall have the right to direct the time,
method and place of

                                       44
<PAGE>

conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee, provided that
                                             -------- ----

          (1) such direction shall not be conflict with any rule of law or with
     this Indenture or expose the Trustee to personal liability, or be unduly
     prejudicial to the Holders not joining therein, and

          (2) the Trustee may take any other action deemed proper by the Trustee
     which is not inconsistent with such direction.

     SECTION 4.13  Waiver of Past Default.

     The Holders, either (a) through the written consent of not less than a
majority in principal amount of the Outstanding Securities, or (b) by the
adoption of a resolution, at a meeting of Holders of the Outstanding Securities
at which a quorum is present, by the Holders of at least a majority in principal
amount of the Outstanding Securities represented at such meeting, may on behalf
of the Holders of all the Securities waive any past default hereunder and its
consequences, except a default (1) in the payment of the principal of or
premium, if any, or interest (including Liquidated Damages, if any) on any
Security or (2) in respect of a covenant or provision hereof which under Article
7 cannot be modified or amended without the consent of the Holders of each
Outstanding Security affected.

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

     SECTION 4.14  Undertaking for Costs.

     All parties to this Indenture agree, and each Holder of any Security by
such Holder's 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 shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in aggregate
principal amount of the Outstanding

                                       45
<PAGE>

Securities, or to any suit instituted by any Holder or any Security for the
enforcement of the payment of the principal of or premium, if any, or interest
(including Liquidated Damages, if any) on any Security on or after the Stated
Maturity expressed in such Security (or, in the case of redemption or exercise
of a Repurchase Right, on or after the Redemption Date) or for the enforcement
of the right to convert any Security in accordance with Article 12.

     SECTION 4.15  Waiver of Stay or Extension Laws.

     The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim to
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.

                                   ARTICLE 5

                                  THE TRUSTEE

     SECTION 5.1  Certain Duties and Responsibilities.

     (a)  Except during the continuance of an Event of Default,

          (1) the Trustee undertakes to perform such duties and only such duties
     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 its part, the Trustee may
     conclusively rely, as to the truth of the statements and the correctness of
     the opinions expressed therein, upon certificates or opinions furnished to
     the Trustee and conforming to the requirements of this Indenture; 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 to this Indenture.

     (b)  In case an Event of Default actually known to a Responsible Officer of
the Trustee has occurred and is continuing, the Trustee shall exercise such of
the rights and powers vested in it by this Indenture, and use the same degree of
care and skill in their

                                       46
<PAGE>

exercise, as a prudent person would exercise or use under the circumstances in
the conduct of such person's own affairs.

     (c) 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
                                      ------

          (1) this paragraph (c) shall not be construed to limit the effect of
     paragraph (a) of this Section;

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

          (3) 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 a majority in principal amount of the Outstanding
     Securities (or such lesser amount as shall have acted at a meeting pursuant
     to the provisions of this Indenture) 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; and

          (4) no provision of this Indenture shall require the Trustee to expend
     or risk its own funds or otherwise incur any financial liability in the
     performance of any of its duties hereunder, or in the exercise of any of
     its rights or powers, if it shall have reasonable grounds for believing
     that repayment of such funds or indemnity satisfactory to it against such
     risk or liability is not reasonably assured to it.

     (d) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.

     SECTION 5.2  Notice of Defaults.

     Within 90 days after the occurrence of any default hereunder of which the
Trustee has received written notice, the Trustee shall give notice to Holders
pursuant to Section 1.5 hereof, unless such default shall have been cured or
waived; provided, however, that, except in the case of a default in the payment
        --------  -------
of the principal of or premium, if any, or interest (including Liquidated
Damages, if any), or in the payment of any redemption or repurchase obligation
on any Security, the Trustee shall be protected in

                                       47
<PAGE>

withholding such notice if and so long as Responsible Officers of the Trustee in
good faith determine that the withholding of such notice is in the interest of
the Holders; and provided further, that in the case of any default of the
                 -------- -------
character specified in Section 4.1(3), no such notice to Holders shall be
given until at least 30 days after the occurrence thereof. For the purpose of
this Section, the term "default" means any event which is, or after notice or
lapse of time or both would become, an Event of Default.

     SECTION 5.3  Certain Rights of Trustee.

     Subject to the provisions of Section 5.1:

          (1) the Trustee may rely and shall be fully protected in acting or
     refraining from acting upon any resolution, Officers' Certificate, Company
     Request, Company Order, other certificate, statement, instrument, opinion,
     report, notice, request, direction, consent, order, bond, debenture, note,
     coupon, other evidence of indebtedness or other paper or document believed
     by it to be genuine and to have been signed or presented by the proper
     party or parties;

          (2) any request or direction of the Company mentioned herein shall be
     sufficiently evidenced by a Company Request or Company Order and any
     resolution of the Board of Directors may be sufficiently evidenced by a
     Board Resolution;

          (3) whenever in the administration of this Indenture the Trustee shall
     deem it desirable that a matter be proved or established prior to taking,
     suffering or omitting any action hereunder, the Trustee (unless other
     evidence be herein specifically prescribed) may, in the absence of bad
     faith on its part, rely upon an Officers' Certificate;

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

          (5) the Trustee shall be under no obligation to exercise any of the
     rights or powers vested in it by this Indenture at the request or direction
     of any of the Holders of Securities pursuant to this Indenture, unless such
     Holders shall have offered to the Trustee security or indemnity
     satisfactory to it against the costs, expenses and liabilities which might
     be incurred by it in compliance with such request or direction;

                                       48
<PAGE>

          (6) 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, direction, consent, order,
     bond, debenture, note, coupon, other evidence of indebtedness or other
     paper or document, but the Trustee, in its discretion, may make such
     further inquiry or investigation into such facts or matters as it may see
     fit, and, if the Trustee shall determine to make such further inquiry or
     investigation, it shall be entitled to examine the books, records and
     premises of the Company, personally or by agent or attorney;

          (7) 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 and the Trustee shall not be responsible for any misconduct or
     negligence on the part of any agent or attorney appointed with due care by
     it hereunder;

          (8) the Trustee shall not be deemed to have notice or actual knowledge
     of any Event of Default (other than an Event of Default described in
     Section 4.1(1) or (2)) unless written notice thereof is received by a
     Responsible Officer of the Trustee at its Corporate Trust Office,
     including, from Holders of not less than 25% in aggregate principal amount
     of the Outstanding Securities;

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

          (10) the rights, protections and immunities afforded to the Trustee
     hereunder shall apply with equal force and effect to any Paying Agent,
     Authenticating Agent, Conversion Agent or Security Registrar acting
     hereunder.

     SECTION 5.4  Not Responsible for Recitals or Issuance of Securities.

     The recitals contained herein and in the Securities (except the Trustee's
and Authenticating Agent's certificates of authentication) shall be taken as the
statements of the Company, and the Trustee assumes no responsibility for their
correctness.  The Trustee makes no representations 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 Securities or the
proceeds thereof.

     SECTION 5.5  May Hold Securities, Act as Trustee Under Other Indentures.

     The Trustee, any Paying Agent, any Transfer Agent, any Conversion Agent,
the Security Registrar or any other agent of the Company or the Trustee, in its
individual or

                                       49
<PAGE>

any other capacity, may become the owner or pledgee of Securities
and may otherwise deal with the Company with the same rights it would have if it
were not Trustee, Paying Agent, Transfer Agent, Conversion Agent, Security
Registrar or such other agent.

     The Trustee may become and act as trustee under other indentures under
which other securities, or certificates of interest or participation in other
securities, of the Company are outstanding in the same manner as if it were not
Trustee.

     SECTION 5.6  Money Held in Trust.

     Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law.  The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
expressly agreed with the Company.

     SECTION 5.7  Compensation and Indemnification of Trustee and Its Prior
Claims.

     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 the Company covenants and agrees to pay or reimburse the
Trustee upon its request for all reasonable expenses, disbursements and advances
incurred or made by or on behalf of it in accordance with any of the provisions
of this Indenture (including the reasonable compensation and the expenses and
disbursements of its counsel and of all agents and other persons not regularly
in its employ), except to the extent that any such expense, disbursement or
advance is due to its negligence or bad faith.  When the Trustee incurs expenses
or renders services in connection with an Event of Default specified in Section
4.1, the expenses (including the reasonable charges and expenses of its counsel)
and the compensation for the services are intended to constitute expenses of
administration under any bankruptcy law.  The Company also covenants to
indemnify the Trustee and its officers, directors, employees and agents for, and
to hold such Persons harmless against, any loss, liability or expense incurred
by them, arising out of or in connection with the acceptance or administration
of this Indenture or the trusts hereunder or the performance of their duties
hereunder, including the costs and expenses of defending themselves against or
investigating any claim of liability in the premises, except to the extent that
any such loss, liability or expense was due to the negligence or bad faith of
such Persons.  The obligations of the Company under this Section 5.7 to
compensate and indemnify the Trustee and its officers, directors, employees and
agents and to pay or reimburse such Persons for expenses, disbursements and
advances shall

                                       50
<PAGE>

constitute additional indebtedness hereunder and shall survive
the satisfaction and discharge of this Indenture or the earlier resignation or
removal of the Trustee.  Such additional indebtedness shall be a senior claim 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, and the Securities are hereby subordinated to such senior
claim.  "Trustee" for purposes of this Section 5.7 shall include any predecessor
Trustee, but the negligence or bad faith of any Trustee shall not affect the
indemnification of any other Trustee.

     SECTION 5.8  Corporate Trustee Required; Eligibility.

     There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (together with any Person
directly or indirectly controlling the Trustee) a combined capital and surplus
of at least U.S. $50,000,000, subject to supervision or examination by federal
or state authority.  If such corporation publishes reports of conditions at
least annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, 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.  If at
any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.

     SECTION 5.9  Resignation and Removal; Appointment of Successor.

     (a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 5.10.

     (b) The Trustee may resign at any time by giving written notice thereof to
the Company.  If the instrument of acceptance by a successor Trustee required by
Section 5.10 shall not have been delivered to the Trustee 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.

     (c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Securities (or such lesser
amount as shall have acted at a meeting pursuant to the provisions of this
Indenture), delivered to the Trustee and the Company.

                                       51
<PAGE>

     (d)  If at any time:

          (1) the Trustee shall cease to be eligible under Section 5.8 and shall
     fail to resign after written request therefor by the Company or by any
     Holder of a Security who has been a bona fide Holder of a Security for at
     least six months, or

          (2) the Trustee shall become incapable of acting or shall be adjudged
     a bankrupt or insolvent or a receiver 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 (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 4.14, any Holder of a Security who has been
a bona fide Holder of a Security for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.

     (e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, the Company,
by a Board Resolution, shall promptly appoint a successor Trustee and shall
comply with the applicable requirements of Section 5.10.  If, within one year
after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee shall be appointed by Act of the Holders of a
majority in principal amount of the Outstanding Securities (or such lesser
amount as shall have acted at a meeting pursuant to the provisions of this
Indenture) delivered to the Company and the retiring Trustee, the successor
Trustee so appointed shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 5.10, become the
successor Trustee and supersede the successor Trustee appointed by the Company.
If no successor Trustee shall have been so appointed by the Company or the
Holders of Securities and accepted appointment in the manner required by Section
5.10, any Holder of a Security who has been a bona fide Holder of a Security for
at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
Trustee.

     (f) The Company shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee to the Holders of
Securities in the manner provided in Section 1.5.  Each notice shall include the
name of the successor Trustee and the address of its Corporate Trust Office.

                                       52
<PAGE>

     SECTION 5.10  Acceptance of Appointment by Successor.

     Every successor Trustee appointed hereunder shall execute, acknowledge and
deliver to the Company and the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder.  Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all such rights, powers and trusts.

     No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be eligible under this Article.

     The fees, charges and expenses of the retiring Trustee shall be paid upon
the appointment of a successor Trustee hereunder.  The retiring Trustee shall
not be liable for any acts or omissions of a successor hereunder.

     SECTION 5.11  Merger, Conversion, Consolidation or Succession to Business.

     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 all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise eligible under this Article,
--------
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.  In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.

     SECTION 5.12  Authenticating Agent.

     The Company may appoint an authenticating agent or agents reasonably
acceptable to the Trustee with respect to the Securities which shall be
authorized to act on behalf of the Trustee to authenticate Securities issued
upon exchange, registration of

                                       53
<PAGE>

transfer, partial redemption thereof or substitution pursuant to this Indenture.
Securities so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder and every reference herein to the authentication and delivery
of Securities by the Trustee or the Trustee's certificate of authentication
shall be deemed to include authentication and delivery on behalf of the Trustee
by an authenticating agent and a certificate of authentication executed on
behalf of the Trustee by an authenticating agent. Each authenticating agent
shall at all times be a bank or trust company authorized by law to act as an
authenticating agent, having a combined capital and surplus of not less than
U.S. $50,000,000 and subject to supervision or examination by a duly constituted
banking authority. If such authenticating agent publishes reports of condition
at least annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section 5.12, the combined
capital and surplus of such authenticating agent shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time an authenticating agent shall cease to be eligible
in accordance with the provisions of this Section 5.12, such authenticating
agent shall resign immediately in the manner and with the effect specified in
this Section 5.12.

     The Company hereby appoints Bankers Trust Company as Authenticating Agent.

     Any corporation into which an authenticating agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such authenticating agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an authenticating agent, shall continue to be an
authenticating agent, provided such corporation shall be otherwise eligible
under this Section 5.12, without the execution or filing of any paper or any
further act on the part of the Trustee or the authenticating agent.

     An authenticating agent may resign at any time by giving written notice
thereof to the Trustee and to the Company.  The Company may at any time
terminate the agency of an authenticating agent by giving written notice thereof
to such authenticating agent and to the Trustee.  Upon receiving such a notice
of resignation or upon such a termination, or in case at any time such
authenticating agent shall cease to be eligible in accordance with the
provisions of this Section 5.12, the Company may appoint a successor
authenticating agent which shall be acceptable to the Trustee.  Any successor
authenticating agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an authenticating agent.  No successor
authenticating agent shall be appointed unless eligible under the provisions of
this Section 5.12.

                                       54
<PAGE>

     The Company agrees to pay to each authenticating agent from time to time
reasonable compensation for its services under this Section 5.12.

     If an authenticating agent is appointed with respect to the Securities
pursuant to this Section 5.12, the Securities may have been endorsed thereon, in
addition to or in lieu of the Trustee's certification of authentication, an
alternate certificate of authentication in the following form:

     This is one of the Securities referred to in the within-mentioned
Indenture:

BANKERS TRUST COMPANY
as Trustee
By Bankers Trust Company, as
 Authenticating Agent


By_____________________________
Authorized Signatory

                                   ARTICLE 6


              CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

     SECTION 6.1  Company May Consolidate, Etc., Only on Certain Terms.

     The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, and the Company shall not permit any Person to consolidate with
or merge into the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:

          (1) in the event that the Company shall consolidate with or merge into
     another Person or convey, transfer or lease its properties and assets
     substantially as an entirety to any Person, the Person formed by such
     consolidation or into which the Company is merged or the Person which
     acquires by conveyance or transfer, or which leases, the properties and
     assets of the Company substantially as an entirety shall be a corporation
     organized and validly existing under the laws of the United States of
     America, any State thereof or the District of Columbia and, if the entity
     surviving such transaction or transferee entity is not the Company, then
     such surviving or transferee entity shall expressly assume, by an indenture

                                       55
<PAGE>

     supplemental hereto, executed and delivered to the Trustee, in form
     satisfactory to the Trustee, the due and punctual payment of the principal
     of and premium, if any and interest (including Liquidated Damages, if any),
     on all the Securities and the performance of every covenant of this
     Indenture on the party of the Company to be performed or observed and shall
     have provided for conversion rights in accordance with Section 12.11;

          (2) at the time of consummation of such transaction, no Event of
     Default, and no event which, after notice or lapse of time or both, would
     become an Event of Default, shall have happened and be continuing; and

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

     SECTION 6.2  Successor Corporation Substituted.

     Upon any consolidation or merger by the Company with or into any other
corporation or any conveyance, transfer or lease of the properties and assets of
the Company substantially as an entirety to any Person, in accordance with
Section 6.1, the successor corporation formed by such consolidation or into
which the Company is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture with the same effect as if such
successor corporation had been named as the Company herein, and thereafter,
except in the case of a lease to another Person, the predecessor corporation
shall be relieved of all obligations and covenants under this Indenture and the
Securities.

                                   ARTICLE 7


                            SUPPLEMENTAL INDENTURES

     SECTION 7.1  Supplemental Indentures Without Consent of Holders of
Securities.

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

                                       56
<PAGE>

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

          (2) to add to the covenants of the Company for the benefit of the
     Holders of Securities, or to surrender any right or power herein conferred
     upon the Company; or

          (3) to modify the restrictive legend set forth on the face of the form
     of Security set forth in Exhibit A hereto or modify the form of
     certificates set forth in Exhibit A hereto; provided, however, that any
                                                 --------  -------
     such modification shall not adversely affect the interest of the Holders of
     the Securities in any material respect; or

          (4) to make provision with respect to the conversion rights of Holders
     of Securities pursuant to Section 12.11; or

          (5) to make provision for the establishment of a book-entry system, in
     which Holders would have the option to participate, for the clearance and
     settlement of transactions in Securities originally issued in certificated
     form; or

          (6) to reduce the Conversion Price; provided, that such reduction in
                                              --------
     the Conversion Price shall not adversely affect the interest of the Holders
     of Securities (after taking into account tax and other consequences of such
     reduction) in any material respect; or

          (7) to qualify this Indenture under the Trust Indenture Act of 1939,
     as amended; or

          (8) to cure any ambiguity, to correct or supplement any provision
     herein which may be inconsistent with any other provision herein or which
     is otherwise defective, or to make any other provisions with respect to
     matters or questions arising under this Indenture which shall not be
     inconsistent with the provisions of this Indenture, provided, such action
                                                         --------
     pursuant to this clause (8) shall not adversely affect the interest of the
     Holders of Securities in any material respect.

     SECTION 7.2  Supplemental Indentures With Consent of Holders of Securities.

     With either (a) the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities, by the Act of said Holders
delivered to the

                                       57
<PAGE>

Company and the Trustee, or (b) by the adoption of a resolution, at a meeting of
Holders of the Outstanding Securities at which a quorum is present, by the
Holders of a majority in principal amount of the Outstanding Securities
represented at such meeting, the Company, when authorized by a Board Resolution,
and the Trustee may enter into an indenture or indentures supplemental hereto
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders of the Securities under this Indenture;
provided, however, that no such supplemental indenture shall, without
--------  -------
the consent of the Holder of each Outstanding Security affected thereby,


          (1) change the Stated Maturity of the principal of, or any installment
     of interest (including Liquidated Damages, if any) on, any Security, or
     reduce the principal amount thereof, or the rate of interest thereon or any
     premium, if any (including any payment of Liquidated Damages), or change
     the coin or currency in which any Security or premium, if any, or the
     interest thereon is payable, or impair the right to institute suit for the
     enforcement of any such payment on or after the Stated Maturity thereof or,
     except as permitted by Section 12.11, adversely affect the Repurchase Right
     or the right to convert any Security as provided in Article 12, or change
     the subordination provisions of the Securities in a manner adverse to the
     Holders of Securities, or

          (2) reduce the requirements of Section 8.4 for quorum or voting, or
     reduce the percentage in principal amount of the Outstanding Securities the
     consent of whose Holders is required for any such supplemental indenture or
     the consent of whose Holders is required for any waiver provided for in
     this Indenture, or

          (3) change the obligation of the Company to maintain an office or
     agency in The City of New York pursuant to Section 9.2, or

          (4) modify any of the provisions of this Section or Section 4.13,
     except to increase any percentage contained herein or therein or to provide
     that certain other provisions of this Indenture cannot be modified or
     waived without the consent of the Holder of each Outstanding Security
     affected thereby.

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

                                       58
<PAGE>

     SECTION 7.3  Execution of Supplemental Indentures.

     In executing or accepting the additional trusts created by any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 5.1) shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of such supplemental indenture is authorized
or permitted by this Indenture and an Officer's Certificate stating that all
conditions precedent to the execution of such supplemental indenture have been
fulfilled.  The Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.

     SECTION 7.4  Effect of Supplemental Indentures.

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

     SECTION 7.5  Reference in Securities to Supplemental Indentures.

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

     SECTION 7.6  Notice of Supplemental Indentures.

     Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of Section 7.1 or 7.2, the
Company shall give notice, setting forth in general terms the substance of such
supplemental indenture, in the manner provided in Section 1.5.  Any failure of
the Company to give such notice, or any defect therein, shall not in any way
impair or affect the validity of any such supplemental indenture.

                                       59
<PAGE>

                                   ARTICLE 8


                        MEETING OF HOLDERS OF SECURITIES

     SECTION 8.1  Purposes for Which Meetings May Be Called.

     A meeting of Holders of Securities may be called at any time and from time
to time pursuant to this Article to make, give or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of Securities.

     SECTION 8.2  Call Notice and Place of Meetings.

     (a) The Trustee may at any time call a meeting of Holders of Securities for
any purpose specified in Section 8.1, to be held at such time and at such place
in The City of New York.  Notice of every meeting of Holders of Securities,
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, in the manner
provided in Section 1.5, not less than 21 nor more than 180 days prior to the
date fixed for the meeting.

     (b) In case at any time the Company, pursuant to a Board Resolution, or the
Holders of at least 10% in principal amount of the Outstanding Securities shall
have requested the Trustee to call a meeting of the Holders of Securities for
any purpose specified in Section 8.1, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the
Trustee shall not have made the first publication of the notice of such meeting
within 21 days after receipt of such request or shall not thereafter proceed to
cause the meeting to be held as provided herein, then the Company or the Holders
of Securities in the amount specified, as the case may be, may determine the
time and the place in The City of New York for such meeting and may call such
meeting for such purposes by giving notice thereof as provided in paragraph (a)
of this Section.

     SECTION 8.3  Persons Entitled to Vote at Meetings.

     To be entitled to vote at any meeting of Holders of Securities, a Person
shall be (a) a Holder of one or more Outstanding Securities, or (b) a Person
appointed by an instrument in writing as proxy for a Holder or Holders of one or
more Outstanding Securities by such Holder or Holders.  The only Persons who
shall be entitled to be present or to speak at any meeting of Holders shall be
the Persons entitled to vote at such meeting and their counsel, any
representatives of the Trustee and its counsel and any representatives of the
Company and its counsel.

                                       60
<PAGE>

     SECTION 8.4  Quorum; Action.

     The Persons entitled to vote a majority in principal amount of the
Outstanding Securities shall constitute a quorum.  In the absence of a quorum
within 30 minutes of the time appointed for any such meeting, the meeting shall,
if convened at the request of Holders of Securities, be dissolved.  In any other
case the meeting may be adjourned for a period of not less than 10 days as
determined by the chairman of the meeting prior to the adjournment of such
meeting.  In the absence of a quorum at any such adjourned meeting, such
adjourned meeting may be further adjourned for a period of not less than 10 days
as determined by the chairman of the meeting prior to the adjournment of such
adjourned meeting.  Notice of the reconvening of any adjourned meeting shall be
given as provided in Section 8.2(a), except that such notice need be given only
once and not less than five days prior to the date on which the meeting is
scheduled to be reconvened.  Notice of the reconvening of an adjourned meeting
shall state expressly the percentage of the principal amount of the Outstanding
Securities which shall constitute a quorum.

     Subject to the foregoing, at the reconvening of any meeting adjourned for a
lack of a quorum, the Persons entitled to vote 25% in principal amount of the
Outstanding Securities at the time shall constitute a quorum for the taking of
any action set forth in the notice of the original meeting.

     At a meeting or an adjourned meeting duly reconvened and at which a quorum
is present as aforesaid, any resolution and all matters (except as limited by
the proviso to Section 7.2) shall be effectively passed and decided if passed or
decided by the Persons entitled to vote by not less than a majority in principal
amount of Outstanding Securities represented and voting at such meeting.

     Any resolution passed or decisions taken at any meeting of Holders of
Securities duly held in accordance with this Section shall be binding on all the
Holders of Securities, whether or not present or represented at the meeting.

     SECTION 8.5  Determination of Voting Rights; Conduct and Adjournment of
Meetings.

     (a) Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Holders of Securities 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 deem appropriate.  Except as otherwise permitted or
required by any such regulations, the holding of Securities shall

                                       61
<PAGE>

be proved in the manner specified in Section 1.3 and the appointment of any
proxy shall be proved in the manner specified in Section 1.3. Such regulations
may provide that written instruments appointing proxies, regular on their face,
may be presumed valid and genuine without the proof specified in Section 1.3 or
other proof.

     (b)  The Trustee shall, by an instrument in writing, appoint a temporary
chairman (which may be the Trustee) of the meeting, unless the meeting shall
have been called by the Company or by Holders of Securities as provided in
Section 8.2(b), in which case the Company or the Holders of Securities 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 Persons entitled to vote a majority in principal
amount of the Outstanding Securities represented at the meeting.

     (c)  At any meeting each Holder of a Security or proxy shall be entitled to
one vote for each U.S. $1,000 principal amount of Securities held or represented
by him; provided, however, that no vote shall be cast or counted at any 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 Holder of a Security or proxy.

     (d)  Any meeting of Holders of Securities duly called pursuant to Section
8.2 at which a quorum is present may be adjourned from time to time by Persons
entitled to vote a majority in principal amount of the Outstanding Securities
represented at the meeting, and the meeting may be held as so adjourned without
further notice.

                                       62
<PAGE>

     SECTION 8.6  Counting Votes and Recording Action of Meetings.

     The vote upon any resolution submitted to any meeting of Holders of
Securities shall be by written ballots on which shall be subscribed the
signatures of the Holders of Securities or of their representatives by proxy and
the principal amounts and serial numbers of the Outstanding Securities held or
represented 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, at least in duplicate, of the proceedings of each meeting of Holders of
Securities 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 given as provided in Section 8.2 and, if
applicable, Section 8.4.  Each copy shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one such
copy shall be delivered to the Company and another 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.

                                   ARTICLE 9

                                   COVENANTS

     SECTION 9.1  Payment of Principal, Premium and Interest.

     The Company will duly and punctually pay the principal of and premium, if
any, and interest (including Liquidated Damages, if any) in respect of the
Securities in accordance with the terms of the Securities and this Indenture.
The Company will deposit or cause to be deposited with the Trustee as directed
by the Trustee, one Business Day prior to the Stated Maturity of any Security or
installment of interest, all payments so due.

     SECTION 9.2  Maintenance of Offices or Agencies.

     The Company hereby appoints the Corporate Trust Office of the Trustee as
its agent in The City of New York, where Securities may be presented or
surrendered for payment, where Securities may be surrendered for registration of
transfer or exchange, where Securities may be surrendered for conversion, and
where notices and demands to or upon the Company in respect of the Securities
and this Indenture may be served.

                                       63
<PAGE>

     The Company may at any time and from time to time vary or terminate the
appointment of any such agent or appoint any additional agents for any or all of
such purposes; provided, however, that until all of the Securities have been
               --------  -------
delivered to the Trustee for cancellation, or moneys sufficient to pay the
principal of and premium, if any, and interest (including Liquidated Damages, if
any) on the Securities have been made available for payment and either paid or
returned to the Company pursuant to the provisions of Section 9.3, the Company
will maintain in The City of New York, an office or agency where Securities may
be presented or surrendered for payment, where Securities may be surrendered for
registration of transfer or exchange, where Securities may be surrendered for
conversion and where notices and demands to or upon the Company in respect of
the Securities and this Indenture may be served.  The Company will give prompt
written notice to the Trustee, and notice to the Holders in accordance with
Section 1.5, of the appointment or termination of any such agents and of the
location and any change in the location of any such office or agency.

     If at any time the Company shall fail to maintain any such required office
or agency in The City of New York, or shall fail to furnish the Trustee with the
address thereof, presentations and surrenders may be made and notices and
demands may be served on and Securities may be surrendered for conversion to the
Corporate Trust Office of the Trustee.

     SECTION 9.3  Money for Security Payments To Be Held in Trust.

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

     Whenever the Company shall have one or more Paying Agents, it will, one
Business Day prior to each due date of the principal of and premium, if any, or
interest (including Liquidated Damages, if any) on any Securities (or, if
applicable, cash in lieu of conversion of any Security), deposit with a Paying
Agent a sum sufficient to pay the principal and premium, if any, or interest
(including Liquidated Damages, if any) so becoming due, such sum to be held in
trust for the benefit of the Persons entitled to such principal, premium, if
any, or interest (including Liquidated Damages, if any), and (unless such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of any
failure so to act.

                                       64
<PAGE>

     The Company will cause each Paying Agent other than the Trustee to execute
and deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section, that such Paying
Agent will:

          (1) hold all sums held by it for the payment of the principal of and
     premium, if any, or interest (including Liquidated Damages, if any) on
     Securities in trust for the benefit of the Persons entitled thereto until
     such sums shall be paid to such Persons or otherwise disposed of as herein
     provided;

          (2) give the Trustee notice of any default by the Company in the
     making of any payment of principal and premium, if any, or interest
     (including Liquidated Damages, if any); and

          (3) at any time during the continuance of any such default, upon the
     written request of the Trustee, forthwith pay to the Trustee all sums so
     held in trust by such Paying Agent.

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

     Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of and premium, if any,
or interest on any Security and remaining unclaimed for two years after such
principal and premium, if any, or interest (including Liquidated Damages, if
any) and redemption or repurchase payments have become due and payable shall be
paid to the Company on Company Request, subject to applicable abandoned property
and escheat laws, or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Security shall thereafter, as an unsecured general
creditor, look only to the Company for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust money, and all liability
of the Company as trustee thereof, shall thereupon cease; provided, however,
                                                          --------  -------
that (i) the Trustee or such Paying Agent, before being required to make any
such repayment, may at the expense of the Company cause to be published or
mailed notice as provided in Section 1.5, except that such notice need be given
only once, (ii) such money remains unclaimed and (iii) after a date specified in
such notice, which

                                       65
<PAGE>

shall not be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will be repaid to the Company.

     SECTION 9.4  Corporate Existence.

     Subject to Article 6, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its corporate existence,
rights (charter and statutory) and franchises; provided, however, that the
                                               --------  -------
Company shall not be required to preserve any such right or franchise if the
Company determines that the preservation thereof is no longer desirable in the
conduct of the business of the Company and that the loss thereof is not
disadvantageous in any material respect to the Holders.

     SECTION 9.5  Maintenance of Properties.

     The Company will, and will cause each Significant Subsidiary to, maintain
and keep its properties and every part thereof in such repair, working order and
condition, and make or cause to be made all such needful and proper repairs,
renewals and replacements thereto, as in the judgment of the Company are
necessary in the interests of the Company; provided, however, that nothing in
                                           --------  -------
this Section shall prevent the Company or any Significant Subsidiary from
selling, abandoning or otherwise disposing of any of their respective properties
or discontinuing a part of their respective businesses from time to time if, in
the judgment of the Company, such sale, abandonment, disposition or
discontinuance is advisable and does not materially adversely affect the
interests or business of the Company or any of its Subsidiaries.

     SECTION 9.6  Payment of Taxes and Other Claims.

     The Company will, and will cause each Significant Subsidiary to, promptly
pay and discharge or cause to be paid and discharged all taxes, assessments and
governmental charges or levies lawfully imposed upon it or upon its income or
profits or upon any of its property, real or personal, or upon any part thereof,
as well as all claims for labor, materials and supplies which, if unpaid, might
by law become a lien or charge upon its property; provided, however, that
                                                  --------  -------
neither the Company nor any Significant Subsidiary shall be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge,
levy, or claim if the amount, applicability or validity thereof shall currently
be contested in good faith by appropriate proceedings and if the Company or such
Significant Subsidiary, as the case may be, shall have set aside on its books
reserves deemed by it adequate with respect thereto.

                                       66
<PAGE>

     SECTION 9.7  Statement by Officers as to Default.

     The Company will deliver to the Trustee, on or before January 2 in each
year ending after the date hereof, an Officers' Certificate, stating whether or
not to the best knowledge of the signers thereof the Company is in default in
the performance and observance of any of the terms, provisions and conditions of
this Indenture, without regard to any period of grace or requirement of notice
provided hereunder and if the Company shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.  In
the event an officer of the Company comes to actually know of such a default,
regardless of the date the Company will deliver an Officers' Certificate to the
Trustee specifying such default and the nature and status thereof.

     SECTION 9.8  Waiver of Certain Covenants.

     The Company may omit in any particular instance to comply with any term,
provision or condition set forth in Sections 9.3 to 9.5, inclusive, if before
the time for such compliance the Holders of at least a majority in aggregate
principal amount of the Outstanding Securities (or such lesser amount as shall
have acted at a meeting pursuant to the provisions of this Indenture) shall, by
Act of such Holders, either waive such compliance in such instance or generally
waive compliance with such term, provision or condition, but no waiver shall
extend to or affect such term, provision or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee in respect of any such term,
provision or condition shall remain in full force and effect.

     SECTION 9.9  Delivery of Certain Information.

     At any time when the Company is not subject to Section 13 or 15(d) of the
Exchange Act, upon the request of a Holder of a Security, the Company will
promptly furnish or cause to be furnished Rule 144A Information to such Holder
or to a prospective purchaser of such Security designated by such Holder, as the
case may be, in order to permit compliance by such Holder with Rule 144A under
the Securities Act in connection with the resale of such Security by such
Holder; provided, however, that the Company shall not be required to furnish
        --------  -------
such information in connection with any request made on or after the date which
is two years from the date such Security (or any predecessor Security) was
acquired from the Company.  "Rule 144A Information" shall be such information as
is specified pursuant to Rule 144A(d)(4) under the Securities Act (or any
successor provision thereto).

                                       67
<PAGE>

     SECTION 9.10  Resale of Certain Securities.

     During the period of two years after the Closing Date, the Company shall
not, and shall not permit any of its "affiliates" (as defined under Rule 144
under the Securities Act) to, resell any Securities, or shares of Common Stock
issuable upon conversion of the Securities, which constitute "restricted
securities" under Rule 144, that are acquired by any of them within the United
States to U.S. persons (as defined in Regulation S) except pursuant to an
effective registration statement under the Securities Act or an applicable
exemption therefrom.  The Trustee shall have no responsibility or liability in
respect of the Company's performance of its agreement in the preceding sentence
nor shall it have any duty to monitor the Company's compliance with the terms of
the preceding sentence.

                                   ARTICLE 10

                            REDEMPTION OF SECURITIES

     SECTION 10.1  Redemption of Notes.

     (a)  Provisional Redemption by the Company.  The Securities may be redeemed
          -------------------------------------
by the Company (a "Provisional Redemption"), in whole or in part, at any time
prior to September 27, 2002 upon notice as set forth in Section 10.5, at a
redemption price equal to 101.3125% of the principal amount of the Securities
plus accrued and unpaid interest, if any (including Liquidated Damages, if any),
to but excluding the date of redemption (the "Provisional Redemption Date") if
(i) the Current Market Value (as defined below) of the Common Stock shall equal
or exceed the following triggering percentages of the Conversion Price then in
effect for at least 20 Trading Days in any consecutive 30-Trading Day period
ending on the Trading Day prior to the date of mailing of the notice of
redemption pursuant to Section 10.5 (the "Notice Date"), if redeemed in the 12-
month period ending on September 26 of the following years:  (A) 2000-170%, (B)
2001-160%; and (C) 2002-150%; and (ii) the shelf registration statement covering
resales of the Securities and the Common Stock issuable upon conversion of the
Securities is effective and available for use and is expected to remain
effective and available for use for the 30 days immediately following the
Provisional Redemption Date.

     Upon any such Provisional Redemption, the Company shall make an additional
payment in cash (the "Interest Make-Whole Payment") to Holders with respect to
the Securities called for redemption, including those Securities converted into
Common Stock between the Notice Date and the Provisional Redemption Date, in an
amount equal to the sum of (i) the present value of the aggregate amount of
interest that would

                                       68
<PAGE>

otherwise have accrued from the Provisional Redemption Date through September
26, 2002 (the "Interest Make-Whole Period") and (ii) Liquidated Damages, if any,
to the Provisional Redemption Date. Such present value shall be calculated by
the Company using the bond equivalent yield on U.S. Treasury notes or bills
having a term nearest in length to that of the Interest Make-Whole Period as of
the Notice Date and the Trustee may conclusively rely upon the Company's written
notice advising the Trustee of the calculations in order for the Trustee to
process the payments to be made.

     The "Current Market Value" for the purposes of this Section 10.1(a) means
the average of the high and low sale prices of the Common Stock as reported on
the Nasdaq National Market or any national securities exchange upon which the
Common Stock is then listed for the Trading Day in question.

     (b)  Optional Redemption by the Company.  The Company may, at its option,
          ----------------------------------
redeem all, or from time to time, any part of the Securities at any time on or
after September 27, 2002, upon notice as set forth in Section 10.5, at the
Redemption Prices specified in the form of Security set forth in Exhibit A
hereto, together with interest to, but excluding, the Redemption Date.

     SECTION 10.2  Applicability of Article.

     Redemption of Securities at the election of the Company or otherwise as
permitted or required by any provision of the Securities or this Indenture,
shall be made in accordance with such provision and this Article.

     SECTION 10.3  Election to Redeem; Notice to Trustee.

     The election of the Company to redeem any Securities shall be evidenced by
a Board Resolution.  The Company shall, at least 45 days prior to the Redemption
Date fixed by the Company (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee of such Redemption Date and of the principal amount
of Securities to be redeemed.

     SECTION 10.4  Selection by Trustee of Securities to Be Redeemed.

     If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 45 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities not previously
called for redemption, by lot, or on a pro rata basis.  Such method of selection
may provide for the selection for redemption of portions (equal to U.S. $1,000
or any integral multiple thereof) of the principal amount of Securities of a
denomination larger than U.S. $1,000.

                                       69
<PAGE>

     If any Security selected for partial redemption is converted in part before
termination of the conversion right with respect to the portion of the Security
so selected, the converted portion of such Security shall be deemed to be the
portion selected for redemption (provided, however, that the Holder of such
                                 --------  -------
Security so converted and deemed redeemed shall not be entitled to any
additional interest payment as a result of such deemed redemption than such
Holder would have otherwise been entitled to receive upon conversion of such
Security).  Securities which have been converted during a selection of
Securities to be redeemed may be treated by the Trustee as Outstanding for the
purpose of such selection.

     The Trustee shall promptly notify the Company and the Security Registrar in
writing of the Securities selected for redemption and, in the case of any
Securities in registered form selected for partial redemption, the principal
amount thereof to be redeemed.

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

     SECTION 10.5  Notice of Redemption.

     Notice of redemption shall be given in the manner provided in Section 1.5
to the Holders of Securities to be redeemed.  Such notice shall be given not
less than 20 nor more than 60 days prior to the Redemption Date.

     All notices of redemption shall state:

          (1)  the Redemption Date,

          (2)  the Redemption Price, the accrued interest, if any, and, with
     respect to Securities called for Provisional Redemption, the Interest Make-
     Whole Payment,

          (3)  if less than all the Outstanding Securities are to be redeemed,
     the aggregate principal amount of Securities to be redeemed and the
     aggregate principal amount of Securities which will be outstanding after
     such partial redemption,

          (4)  that on the Redemption Date the Redemption Price, the accrued
     interest, if any, and, with respect to Securities called for Provisional
     Redemption,

                                       70
<PAGE>

     the Interest Make-Whole Payment, will become due and payable
     upon each such Security to be redeemed, and that interest thereon shall
     cease to accrue on and after said date,

          (5)  the Conversion Price, the date on which the right to convert the
     principal of the Securities to be redeemed will terminate and the places
     where such Securities may be surrendered for conversion,

          (6)  the place or places that the certificate required by Section 10.7
     and Section 2.2 shall be delivered, and the form of such certificate,

          (7)  the place or places where such Securities are to be surrendered
     for payment of the Redemption Price, accrued interest, if any, and, with
     respect to Securities called for Provisional Redemption, the Interest Make-
     Whole Payment, and

          (8)  the CUSIP number of the Securities.

     In case of a partial redemption, the first notice given shall specify the
last date on which exchanges or transfers of Securities may be made pursuant to
Section 2.5, and the second notice shall specify the serial numbers of
Securities and the portions thereof called for redemption.

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

     SECTION 10.6  Deposit of Redemption Price.

     On or prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 9.3) an amount of
money sufficient to pay the Redemption Price of, (except if the Redemption Date
shall be an Interest Payment Date) accrued interest on, and, with respect to
Securities called for Provisional Redemption, the Interest Make-Whole Payment
on, all the Securities which are to be redeemed on that date other than any
Securities called for redemption on that date which have been converted prior to
the date of such deposit.

     If any Security called for redemption is converted pursuant hereto prior to
such redemption, any money deposited with the Trustee or with a Paying Agent or
so segregated and held in trust for the redemption of such Security shall
(subject to any right

                                       71
<PAGE>

of the Holder of such Security or any Predecessor Security to receive interest
as provided in the last paragraph of Section 2.7) be paid to the Company on
Company Request or, if then held by the Company, shall be discharged from such
trust; provided that, with respect to a Provisional Redemption, any money so
deposited for payment of the Interest Make-Whole Payment shall remain segregated
and held in trust for payment of the Interest Make-Whole Payment which shall be
made on all Securities called for Provisional Redemption, including Securities
converted into shares of Common Stock after the Notice Date and prior to the
Provisional Redemption Date.

     SECTION 10.7  Securities Payable on Redemption Date.

     Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest.  Upon surrender of any
such Security for redemption in accordance with said notice, such Security shall
be paid by the Company at the Redemption Price together with accrued interest
and, with respect to Securities called for Provisional Redemption, to the
Redemption Date; provided, however, the installments of interest on Securities
                 --------  -------
whose Stated Maturity is on or prior to the Redemption Date shall be payable to
the Holders of such Securities, or one or more Predecessor Securities,
registered as such on the relevant Record Date according to their terms and the
provisions of Section 2.7; provided, that, with respect to a Provisional
                           --------  ----
Redemption, the Interest Make-Whole Payment, the holder of any Securities
converted into Common Stock pursuant to the terms hereof after the Notice Date
and prior to the Provisional Redemption Date shall have the right to the
Interest Make-Whole Payment, if any, with respect to such Securities regardless
of the conversion of such Securities.

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

     Upon presentation and surrender of any Security which is to be purchased in
part only, upon its purchase, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder thereof, at the expense of the Company, a
new Security or Securities in authorized denominations in aggregate principal
amount equal to the portion of the Security not purchased.

                                       72
<PAGE>

     SECTION 10.8  Securities Redeemed in Part.

     Any Security which is to be redeemed only in part shall be surrendered at
an office or agency of the Company designated for that purpose pursuant to
Section 9.2 (with, if the Company or the Trustee so requires, due endorsement
by, or a written instrument of transfer in form satisfactory to the Company and
the Trustee duly executed by, the Holder thereof or the Holder's attorney duly
authorized in writing), and the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Security without service charge,
a new Security or Securities of any authorized denomination as requested by such
Holder in aggregate principal amount equal to and in exchange for the unredeemed
portion of the principal of the Security so surrendered.

                                   ARTICLE 11

                      REPURCHASE UPON A CHANGE OF CONTROL

     SECTION 11.1  Repurchase Right.

     (a)  If there shall occur a Change of Control, then each Holder shall have
the right (the "Repurchase Right"), at such Holder's option, but subject to the
provisions of Section 11.2, to require the Company to repurchase all of such
Holder's Securities, or any portion thereof (in principal amounts of $1,000 or
integral multiples thereof), on the repurchase date fixed by the Company that is
not less than 30 days nor more than 45 days after the date of the Company Notice
(as defined in Section 11.3 below) of such Change of Control (or, if such 45th
day is not a Business Day, the next succeeding Business Day).  The repurchase
price shall be equal to 100% of the principal amount of Securities, together
with accrued interest, if any, to, but excluding, the repurchase date (the
"Repurchase Price"); provided, that if such repurchase date is March 27 or
                     --------
September 27, then the interest payable on such date shall be paid to the holder
of record of the Securities on the next preceding March 13 or September 13,
respectively.  At the option of the Company, the Repurchase Price may be paid in
cash or, subject to the fulfillment by the Company of the conditions set forth
in Section 11.2, by delivery of shares of Common Stock having a fair market
value equal to the Repurchase Price as described in Section 11.2(a).  Whenever
in this Indenture there is a reference in any context, to the principal of any
Security as of any time, such reference shall be deemed to include reference to
the Repurchase Price payable in respect of such Security to the extent that such
Repurchase Price is, was or would be so payable at such time, and express
mention of the Repurchase Price in any provision of this Indenture shall not be
construed as excluding the Repurchase Price in those provisions of this
Indenture when such express mention is not made; provided, however, that for the
                                                 --------  -------
purposes of Article 13, such

                                       73
<PAGE>

reference shall be deemed to include reference to the Repurchase Price only if
the Repurchase Price is payable in cash.

     SECTION 11.2  Conditions to the Company's Election to Pay the Repurchase
Price in Common Stock.

     The Company may elect to pay the Repurchase Price by delivery of shares of
Common Stock pursuant to Section 11.1 if and only if the following conditions
have been satisfied:

          (a)  The shares of Common Stock deliverable in payment of the
     Repurchase Price shall have a fair market value as of the repurchase date
     of not less than the Repurchase Price.  For purposes of this Section 11.2,
     the fair market value of shares of Common Stock shall be determined by the
     Company and shall be equal to 95% of the average of the Closing Prices of
     the Common Stock for the five consecutive Trading Days ending on and
     including the third Trading Day immediately preceding the repurchase dates;

          (b)  In the event any shares of Common Stock to be issued upon
     repurchase of Securities hereunder require registration under any Federal
     securities law before such shares may be freely transferrable without being
     subject to any transfer restrictions under the Securities Act upon
     repurchase, such registration shall have been completed and shall have
     become effective prior to the repurchase date;

          (c)  In the event any shares of Common Stock to be issued upon
     repurchase of Securities hereunder require registration with or approval of
     any governmental authority under any State law or any other Federal law
     before such shares may be validly issued or delivered upon repurchase, such
     registration shall have been completed, have become effective and such
     approval shall have been obtained, in each case, prior to the repurchase
     date;

          (d)  The shares of Common Stock deliverable in payment of the
     Repurchase Price shall be listed for trading on a U.S. national securities
     exchange or approved for trading on an established automated over-the-
     counter trading market in the United States, in either case, immediately
     prior to the repurchase date; and

          (e)  All shares of Common Stock deliverable in payment of the
     Repurchase Price shall be issued out of the Company's authorized but
     unissued

                                       74
<PAGE>

     Common Stock and will, upon issue, be duly and validly issued and fully
     paid and non-assessable and free of any preemptive rights.

     If all of the conditions set forth in this Section 11.2 are not satisfied
in accordance with the terms thereof, the Repurchase Price shall be paid by the
Company only in cash.

     SECTION 11.3  Notices; Method of Exercising Repurchase Right, Etc.

     (a)  Unless the Company shall have theretofore called for redemption all of
the outstanding Securities, on or before the thirtieth (30th) calendar day after
the Company becomes aware of the occurrence of a Change of Control, the Company
or, at the request and expense of the Company, the Trustee, shall mail to all
Holders a notice (the "Company Notice") of the occurrence of the Change of
Control and of the Repurchase Right set forth herein arising as a result
thereof.  The Company shall also deliver a copy of such notice of a Repurchase
Right to the Trustee and cause such notice of a Repurchase Right, or a summary
of the information contained therein, to be published at the expense of the
Company in a newspaper of general circulation in The City of New York.  The
Company Notice shall contain the following information:

          (1)  the repurchase date,

          (2)  the date by which the Repurchase Right must be exercised,

          (3)  the last date by which the election to require repurchase, if
     submitted, may be revoked,

          (4)  the Repurchase Price, and whether the Repurchase Price shall be
     paid by the Company in cash or by delivery of shares of Common Stock,

          (5)  a description of the procedure which a Holder must follow to
     exercise a Repurchase Right, and

          (6)  the Conversion Price then in effect, the date on which the right
     to convert the principal amount of the Securities to be repurchased will
     terminate and the place or places where Securities may be surrendered for
     conversion.

     No failure of the Company to give the foregoing notices or defect therein
shall limit any Holder's right to exercise a Repurchase Right or affect the
validity of the proceedings for the repurchase of Securities.



                                       75
<PAGE>

     If any of the foregoing provisions are inconsistent with applicable law,
such law shall govern.

     (b) To exercise a Repurchase Right, a Holder shall deliver to the Trustee
on or before the close of business on the repurchase date (i) written notice to
the Company (or agent designated by the Company for such purpose) of the
Holder's exercise of such right, which notice shall set forth the name of the
Holder, the principal amount of the Securities to be repurchased, a statement
that an election to exercise the Repurchase Right is being made thereby, and, in
the event that the Repurchase Price shall be paid in shares of Common Stock, the
name or names (with addresses) in which the certificate or certificates for
shares of Common Stock shall be issued, and (ii) the Securities with respect to
which the Repurchase Right is being exercised, duly endorsed for transfer to the
Company.  Election of repurchase by a Holder shall be revocable at any time
prior to, but excluding, the repurchase date, by delivering written notice to
that effect to the Trustee prior to the close of business on the Business Day
prior to the repurchase date.

     (c) In the event the Repurchase Right shall be exercised in accordance with
the terms hereof, the Company shall pay or cause to be paid to the Trustee the
Repurchase Price in cash or shares of Common Stock, as provided above, for
payment to the Holder on the repurchase date or, if shares of Common Stock are
to be issued, as promptly after the repurchase date as practicable.

     (d) If the Company fails to repurchase on the repurchase date any
Securities (or portions thereof) as to which the Repurchase Right has been
properly exercised, then the principal of such Securities shall, until paid,
bear interest to the extent permitted by applicable law from the repurchase date
at the rate borne by the Securities and each such Security shall be convertible
into Common Stock in accordance with this Indenture (without giving effect to
Section 11.2(b)) until the principal of such Security shall have been paid or
duly provided for.

     (e) Any Security which is to be repurchased only in part shall be
surrendered to the Trustee (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or its attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Security without service
charge a new Security or Securities, containing identical terms and conditions,
of any authorized denomination as requested by such Holder in aggregate
principal amount equal to and in exchange for the unrepurchased portion of the
principal of the Security so surrendered.

                                       76
<PAGE>

     (f) On the repurchase date, the Company shall deposit with the Trustee or
with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 9.3) an amount of money
sufficient to pay the Repurchase Price of the Securities that are to be repaid
on the repurchase date.

     (g) Any issuance of shares of Common Stock in respect of the Repurchase
Price shall be deemed to have been effected immediately prior to the close of
business on the repurchase date and the person or persons in whose name or names
any certificate or certificates for shares of Common Stock shall be issuable
upon such repurchase shall be deemed to have become on the repurchase date the
holder or holders of record of the shares represented thereby; provided,
                                                               --------
however, that any surrender for repurchase on a date when the stock transfer
-------
books of the Company shall be closed shall constitute the person or persons in
whose name or names the certificate or certificates for such shares are to be
issued as the record holder or holders thereof for all purposes at the opening
of business on the next succeeding day on which such stock transfer books are
open.  No payment or adjustment shall be made for dividends or distributions on
any Common Stock issued upon repurchase of any Security declared prior to the
repurchase date.

     (h) No fractional shares of Common Stock or scrip representing fractional
shares shall be issued upon repurchase of Securities.  If more than one Security
shall be repurchased from the same holder and the Repurchase Price shall be
payable in shares of Common Stock, the number of full shares which shall be
issued upon repurchase shall be computed on the basis of the aggregate principal
amount of the Securities (or specified portions thereof to the extent permitted
hereby) so repurchased.  If any fractional share of stock otherwise would be
issuable upon repurchase of any Security or Securities, the Company shall make
an adjustment therefor in cash at the current market value thereof to the Holder
of Securities.  For these purposes, the current market value of a share of
Common Stock shall be the Closing Price on the first Trading Day immediately
preceding the repurchase date.

     (i) The issue of stock certificates on repurchase of Securities shall be
made without charge to the Holder of Securities being repurchased for any tax in
respect of the issue thereof.  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 stock in any name other than that of the Holder of any
Security repurchased, and the Company shall not be required to issue or deliver
any such stock certificate unless and until the person or persons requesting the
issue thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.

                                       77
<PAGE>

                                   ARTICLE 12

                            CONVERSION OF SECURITIES

     SECTION 12.1  Conversion Privilege and Conversion Price.

     Subject to and upon compliance with the provisions of this Article, at the
option of the Holder thereof, any definitive Security or any portion of the
principal amount thereof which is U.S. $1,000 or an integral multiple of U.S.
$1,000 may be converted at the principal amount thereof, or of such portion
thereof, into duly authorized, fully paid and nonassessable shares of Common
Stock, at the Conversion Price, determined as hereinafter provided, in effect at
the time of conversion. Such conversion right shall, with respect to all
Securities, commence on the original issuance thereof and expire at the close of
business September 27, 2004. In case a Security or portion thereof is called for
redemption, such conversion right in respect of the Security or the portion so
called, shall expire at the close of business on the second Business Day
preceding the Redemption Date, unless the Company defaults in making the payment
due upon redemption. In the case of a Change of Control for which the Holder
exercises its Repurchase Right with respect to a Security or portion thereof,
such conversion right in respect of the Security or portion thereof shall expire
upon receipt of the written notice of exercise of such Repurchase Right provided
                                                                        --------
that the expiration of a Holder's conversion right hereunder is subject to such
Holder's right to revoke the exercise of its Repurchase Right.

     The price at which shares of Common Stock shall be delivered upon
conversion (herein called the "Conversion Price") shall be initially U.S. $40.00
per share of Common Stock.  The Conversion Price shall be adjusted in certain
instances as provided in paragraphs (a), (b), (c), (d), (e), (f) and (h) of
Section 12.4.

     SECTION 12.2  Exercise of Conversion Privilege.

     In order to exercise the conversion privilege, the Holder of any definitive
Security to be converted shall surrender such Security duly endorsed or assigned
to the Company or in blank, at the office of any Conversion Agent (as specified
and subject to the terms and limitations set forth in Section 9.2), accompanied
by a duly signed conversion notice substantially in the form attached to the
Security to the Company at such Conversion Agent stating that the Holder elects
to convert such Security or, if less than the entire principal amount thereof is
to be converted, the portion thereof to be converted.  Securities 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 (except in the case of any Security whose Maturity is prior to such
Interest Payment

                                       78
<PAGE>

Date) shall be accompanied by payment in New York Clearing House funds or other
funds acceptable to the Conversion Agent of an amount equal to the interest to
be received on such Interest Payment Date on the principal amount of Securities
being surrendered for conversion.

     Securities shall be deemed to have been converted immediately prior to the
close of business on the day of surrender of such Securities for conversion in
accordance with the foregoing provisions, and at such time the rights of the
Holders of such Securities as Holders shall cease, and the Person or Persons
entitled to receive the Common Stock issuable upon conversion shall be treated
for all purposes as the record holder or holders of such Common Stock at such
time.  As promptly as practicable on or after the conversion date, the Company
shall cause to be issued and delivered to such Conversion Agent a certificate or
certificates for the number of full shares of Common Stock issuable upon
conversion, together with payment in lieu of any fraction of a share as provided
in Section 12.3.

     In the event that the Company shall have failed to register the Common
Stock into which the Restricted Securities may be converted pursuant to an
effective registration statement under the Securities Act, all shares of Common
Stock delivered upon such conversion shall bear a restrictive legend
substantially in the form of the legend required to be set forth on the
Restricted Securities pursuant to Sections 2.5 and as set forth in the form of
Security in Exhibit A hereto and shall be subject to the restrictions on
transfer provided in such legend.  Neither the Trustee nor the Conversion Agent
shall have any responsibility for the inclusion or content of any such
restrictive legend on such Common Stock; provided, however, that the Trustee or
                                         --------  -------
such Conversion Agent, as the case may be, shall have provided, to the Company
or to the Company's transfer agent for such Common Stock, prior to or
concurrently with a request to the Company to deliver to the Conversion Agent
certificates of such Common Stock, written notice that the Securities delivered
for conversion are Restricted Securities.

     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 the Holder thereof, at the expense of the Company, a new Security or
Securities of authorized denominations in aggregate principal amount equal to
the unconverted portion of the principal amount of such Securities.

     If shares of Common Stock to be issued upon conversion of a Restricted
Security, or Securities to be issued upon conversion of a Restricted Security in
part only, are to be registered in a name other than that of the Holder of such
Restricted Security, then such Holder must deliver to the Conversion Agent a
certificate in substantially the form set

                                       79
<PAGE>

forth in the form of Security set forth in Exhibit A hereto, dated the date of
surrender of such Restricted Security and signed by such Holder, as to
compliance with the restrictions on transfer applicable to such Restricted
Security. Neither the Trustee nor any Conversion Agent, Registrar or Transfer
Agent shall be required to register in a name other than that of the Holder
shares of Common Stock or Securities issued upon conversion of any such
Restricted Security not so accompanied by a properly completed certificate.

     SECTION 12.3  Fractions of Shares.

     No fractional shares of Common Stock shall be issued upon any conversion of
any Security or Securities.  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 thereof shall be computed on the basis of the
aggregate principal amount of the Securities (or specified portions thereof) so
surrendered.  Instead of any fractional share of Common Stock which would
otherwise be issuable upon conversion of any Security or Securities (or
specified portions thereof), the Company shall pay a cash adjustment in respect
of such fraction (calculated to the nearest one-100th of a share) in an amount
equal to the same fraction of the Closing Price of the Common Stock as of the
Trading Day before the date of conversion.

     SECTION 12.4  Adjustment of Conversion Price.

     The Conversion Price shall be subject to adjustments, calculated by the
Company, from time to time as follows:

     (a) In case the Company shall hereafter pay a dividend or make a
distribution to all holders of the outstanding Common Stock in shares of Common
Stock, the Conversion Price in effect at the opening of business on the date
following the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be reduced by multiplying such
Conversion Price by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of business on the Record Date
(as defined in Section 12.4(g)) fixed for such determination and the denominator
shall be the sum of such number of shares and the total number of shares
constituting such dividend or other distribution, such reduction to become
effective immediately after the opening of business on the day following the
Record Date.  If any dividend or distribution of the type described in this
Section 12.4(a) is declared but not so paid or made, the Conversion Price shall
again be adjusted to the Conversion Price which would then be in effect if such
dividend or distribution had not been declared.

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<PAGE>

     (b) In case the Company shall issue rights or warrants to all holders of
its outstanding shares of Common Stock entitling them (for a period expiring
within forty-five (45) days after the date fixed for the determination of
stockholders entitled to receive such rights or warrants) to subscribe for or
purchase shares of Common Stock at a price per share less than the Current
Market Price (as defined in Section 12.4(g)) on the Record Date fixed for the
determination of stockholders entitled to receive such rights or warrants, the
Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect at the opening of
business on the date after such Record Date by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding at the close of
business on the Record Date plus the number of shares which the aggregate
offering price of the total number of shares so offered would purchase at such
Current Market Price, and of which the denominator shall be the number of shares
of Common Stock outstanding on the close of business on the Record Date plus the
total number of additional shares of Common Stock so offered for subscription or
purchase.  Such adjustment shall become effective immediately after the opening
of business on the day following the Record Date fixed for determination of
stockholders entitled to receive such rights or warrants.  To the extent that
shares of Common Stock are not delivered pursuant to such rights or warrants,
upon the expiration or termination of such rights or warrants the Conversion
Price shall be readjusted to the Conversion Price which would then be in effect
had the adjustments made upon the issuance of such rights or warrants been made
on the basis of the delivery of only the number of shares of Common Stock
actually delivered.  In the event that such rights or warrants are not so
issued, the Conversion Price shall again be adjusted to be the Conversion Price
which would then be in effect if such date fixed for the determination of
stockholders entitled to receive such rights or warrants had not been fixed.  In
determining whether any rights or warrants entitle the holders to subscribe for
or purchase shares of Common Stock at less than such Current Market Price, and
in determining the aggregate offering price of such shares of Common Stock,
there shall be taken into account any consideration received for such rights or
warrants, the value of such consideration if other than cash, to be determined
by the Board of Directors.

     (c) In case the outstanding shares of Common Stock shall be subdivided into
a greater number of shares of Common Stock, the Conversion Price in effect at
the opening of business on the day following the day upon which such subdivision
becomes effective shall be proportionately reduced, and conversely, in case
outstanding shares of Common Stock shall be combined into a smaller number of
shares of Common Stock, the Conversion Price in effect at the opening of
business on the day following the day upon which such combination becomes
effective shall be proportionately increased, such reduction or increase, as the
case may be, to become effective immediately after the

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<PAGE>

opening of business on the day following the day upon which such subdivision or
combination becomes effective.

     (d) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock shares of any class of capital stock of the Company
(other than any dividends or distributions to which Section 12.4(a) applies) or
evidences of its indebtedness, cash or other assets (including securities, but
excluding (1) any rights or warrants referred to in Section 12.4(b), (2)
dividends and distributions paid exclusively in cash and (3) any capital stock,
evidences of indebtedness, cash or assets distributed upon a merger or
consolidation to which Section 12.11 applies) (the foregoing hereinafter in this
Section 12.4(d) called the "securities")) (unless the Company elects to reserve
such securities for distribution to the Holders upon conversion of the
Securities so that any such Holder converting Securities will receive upon such
conversion, in addition to the shares of Common Stock to which such Holder is
entitled, the amount and kind of such securities which such Holder would have
received if such Holder had converted its Securities into Common Stock
immediately prior to the Record Date (as defined in Section 12.4(g)) for such
distribution of the securities)), then, in each such case, the Conversion Price
shall be reduced so that the same shall be equal to the price determined by
multiplying the Conversion Price in effect immediately prior to the close of
business on the Record Date (as defined in Section 12.4(g)) with respect to such
distribution by a fraction of which the numerator shall be the Current Market
Price (determined as provided in Section 12.4(g)) on such date less the fair
market value (as determined by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution) on such date of the portion
of the securities so distributed applicable to one share of Common Stock and the
denominator shall be such Current Market Price, such reduction to become
effective immediately prior to the opening of business on the day following the
Record Date; provided, however, that in the event the then fair market value (as
             --------  -------
so determined) of the portion of the securities so distributed applicable to one
share of Common Stock is equal to or greater than the Current Market Price on
the Record Date, in lieu of the foregoing adjustment, adequate provision shall
be made so that each Holder shall have the right to receive upon conversion of a
Security (or any portion thereof) the amount of securities such Holder would
have received had such Holder converted such Security (or portion thereof)
immediately prior to such Record Date.  In the event that such dividend or
distribution is not so paid or made, the Conversion Price shall again be
adjusted to be the Conversion Price would then be in effect if such dividend or
distribution had not been declared.  If the Board of Directors determines the
fair market value of any distribution for purposes of this Section 12.4(d) by
reference to the actual or when issued trading market for any securities
comprising all or part of such distribution, it must in doing so consider the
prices in such market over the same period (the "Reference Period") used in
computing the Current Market Price

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<PAGE>

pursuant to Section 12.4(g) to the extent possible, unless the Board of
Directors in a Board Resolution determines in good faith that determining the
fair market value during the Reference Period would not be in the best interest
of the Holder.

     Rights or warrants distributed by the Company to all holders of Common
Stock entitling the holders thereof to subscribe for or purchase shares of the
Company's capital stock (either initially or under certain circumstances), which
rights or warrants, until the occurrence of a specified event or events
("Trigger Event"); (i) are deemed to be transferred with such shares of Common
Stock; (ii) are not exercisable; and (iii) are also issued in respect of future
issuances of Common Stock, shall be deemed not to have been distributed for
purposes of this Section 12.4(d) (and no adjustment to the Conversion Price
under this Section 12.4(d) will be required) until the occurrence of the
earliest Trigger Event.  If such right or warrant is subject to subsequent
events, upon the occurrence of which such right or warrant shall become
exercisable to purchase different securities, evidences of indebtedness or other
assets or entitle the holder to purchase a different number or amount of the
foregoing or to purchase any of the foregoing at a different purchase price,
then the occurrence of each such event shall be deemed to be the date of
issuance and record date with respect to a new right or warrant (and a
termination or expiration of the existing right or warrant without exercise by
the holder thereof).  In addition, in the event of any distribution (or deemed
distribution) of rights or warrants, or any Trigger Event or other event (of the
type described in the preceding sentence) with respect thereto, that resulted in
an adjustment to the Conversion Price under this Section 12.4(d), (1) in the
case of any such rights or warrants which shall all have been redeemed or
repurchased without exercise by any holders thereof, the Conversion Price shall
be readjusted upon such final redemption or repurchase to give effect to such
distribution or Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price received by
a holder of Common Stock with respect to such rights or warrants (assuming such
holder had retained such rights or warrants), made to all holders of Common
Stock as of the date of such redemption or repurchase, and (2) in the case of
such rights or warrants all of which shall have expired or been terminated
without exercise, the Conversion Price shall be readjusted as if such rights and
warrants had never been issued.

     For purposes of this Section 12.4(d) and Sections 12.4(a) and (b), any
dividend or distribution to which this Section 12.4(d) is applicable that also
includes shares of Common Stock, or rights or warrants to subscribe for or
purchase shares of Common Stock to which Section 12.4(b) applies (or both),
shall be deemed instead to be (1) a dividend or distribution of the evidences of
indebtedness, assets, shares of capital stock, rights or warrants other than
such shares of Common Stock or rights or warrants to which Section 12.4(b)
applies (and any Conversion Price reduction required by this

                                       83
<PAGE>

Section 12.4(d) with respect to such dividend or distribution shall then be
made) immediately followed by (2) a dividend or distribution of such shares of
Common Stock or such rights or warrants (and any further Conversion Price
reduction required by Sections 12.4(a) and (b) with respect to such dividend or
distribution shall then be made), except (A) the Record Date of such dividend or
distribution shall be substituted as "the date fixed for the determination of
stockholders entitled to receive such dividend or other distribution," "Record
Date fixed for such determinations" and "Record Date" within the meaning of
Section 12.4(a) and as "the date fixed for the determination of stockholders
entitled to receive such rights or warrants," "the Record Date fixed for the
determination of the stockholders entitled to receive such rights or warrants"
and such "Record Date" within the meaning of Section 12.4(b) and (B) any shares
of Common Stock included in such dividend or distribution shall not be deemed
"outstanding at the close of business on the date fixed for such determination"
within the meaning of Section 12.4(a).

     (e) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock cash (excluding any cash that is distributed upon a
merger or consolidation to which Section 12.11 applies or as part of a
distribution referred to in Section 12.4(d)), in an aggregate amount that,
combined together with (1) the aggregate amount of any other such distributions
to all holders of Common Stock made exclusively in cash within the twelve (12)
months preceding the date of payment of such distribution, and in respect of
which no adjustment pursuant to this Section 12.4(e) has been made, and (2) the
aggregate of any cash plus the fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a Board
Resolution) of consideration payable in respect of any tender offer by the
Company or any of its Subsidiaries for all or any portion of the Common Stock
concluded within the twelve (12) months preceding the date of such distribution,
and in respect of which no adjustment pursuant to Section 12.4(f) has been made,
exceeds 10.0% of the product of the Current Market Price (determined as provided
in Section 12.4(g)) on the Record Date with respect to such distribution times
the number of shares of Common Stock outstanding on such date, then and in each
such case, immediately after the close of business on such date, the Conversion
Price shall be reduced so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the close of
business on such Record Date by a fraction (i) the numerator of which shall be
equal to the Current Market Price on the Record Date less an amount equal to the
quotient of (x) the excess of such combined amount over such 10.0% and (y) the
number of shares of Common Stock outstanding on the Record Date and (ii) the
denominator of which shall be equal to the Current Market Price on such date,
provided, however, that in the event the portion of the cash so distributed
--------  -------
applicable to one share of Common Stock is equal to or greater than the Current
Market Price of the Common Stock on the Record Date, in lieu of the foregoing
adjustment, adequate provision shall be made so that each

                                       84
<PAGE>

Holder shall have the right to receive upon conversion of a Security (or any
portion thereof) the amount of cash such Holder would have received had such
Holder converted such Security (or portion thereof) immediately prior to such
Record Date. In the event that such dividend or distribution is not so paid or
made, the Conversion Price shall again be adjusted to be the Conversion Price
which would then be in effect if such dividend or distribution had not been
declared. Any cash distribution to all holders of Common Stock as to which the
Company makes the election permitted by Section 12.4(l) and as to which the
Company has complied with the requirements of such Section shall be treated as
not having been made for all purposes of this Section 12.4(e).

     (f) In case a tender offer made by the Company or any of its Subsidiaries
for all or any portion of the Common Stock shall expire and such tender offer
(as amended upon the expiration thereof) shall require the payment to
stockholders (based on the acceptance (up to any maximum specified in the terms
of the tender offer) of Purchased Shares (as defined below)) of an aggregate
consideration having a fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a Board
Resolution) that combined together with (1) the aggregate of the cash plus the
fair market value (as determined by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution), as of the expiration
of such tender offer, of consideration payable in respect of any other tender
offers, by the Company or any of its Subsidiaries for all or any portion of the
Common Stock expiring within the twelve (12) months preceding the expiration of
such tender offer and in respect of which no adjustment pursuant to this Section
12.4(f) has been made and (2) the aggregate amount of any distributions to all
holders of the Company's Common Stock made exclusively in cash within twelve
(12) months preceding the expiration of such tender offer and in respect of
which no adjustment pursuant to Section 12.4(e) has been made, exceeds 10.0% of
the product of the Current Market Price (determined as provided in Section
12.4(g)) as of the last time (the "Expiration Time") tenders could have been
made pursuant to such tender offer (as it may be amended) times the number of
shares of Common Stock outstanding (including any tendered shares) on the
Expiration Time, then, and in each such case, immediately prior to the opening
of business on the day after the date of the Expiration Time, the Conversion
Price shall be adjusted so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to close of
business on the date of the Expiration Time by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding (including any
tendered shares) on the Expiration Time multiplied by the Current Market Price
of the Common Stock on the Trading Day next succeeding the Expiration Time and
the denominator shall be the sum of (x) the fair market value (determined as
aforesaid) of the aggregate consideration payable to stockholders based on the
acceptance (up to any maximum specified in the terms of the tender offer) of all

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<PAGE>

shares validly tendered and not withdrawn as of the Expiration Time (the shares
deemed so accepted, up to any such maximum, being referred to as the "Purchased
Shares") and (y) the product of the number of shares of Common Stock outstanding
(less any Purchased Shares) on the Expiration Time and the Current Market Price
of the Common Stock on the Trading Day next succeeding the Expiration Time, such
reduction (if any) to become effective immediately prior to the opening of
business on the day following the Expiration Time.  In the event that the
Company is obligated to purchase shares pursuant to any such tender offer, but
the Company is permanently prevented by applicable law from effecting any such
purchases or all such purchases are rescinded, the Conversion Price shall again
be adjusted to be the Conversion Price which would then be in effect if such
tender offer had not been made.  If the application of this Section 12.4(f) to
any tender offer would result in an increase in the Conversion Price, no
adjustment shall be made for such tender offer under this Section 12.4(f).  Any
cash distribution to all holders of Common Stock as to which the Company has
made the election permitted by Section 12.4(m) and as to which the Company has
complied with the requirements of such Section shall be treated as not having
been made for all purposes of this Section 12.4(f).

     (g) For purposes of this Section 12.4, the following terms shall have the
meaning indicated:

          (1) "Current Market Price" shall mean the average of the daily Closing
     Prices per share of Common Stock for the ten (10) consecutive Trading Days
     immediately prior to the date in question; provided, however, that (1) if
                                                --------  -------
     the "ex" date (as hereinafter defined) for any event (other than the
     issuance or distribution requiring such computation) that requires an
     adjustment to the Conversion Price pursuant to Section 12.4(a), (b), (c),
     (d), (e) or (f) occurs during such ten (10) consecutive Trading Days, the
     Closing Price for each Trading Day prior to the "ex" date for such other
     event shall be adjusted by multiplying such Closing Price by the same
     fraction by which the Conversion Price is so required to be adjusted as a
     result of such other event, (2) if the "ex" date for any event (other than
     the issuance or distribution requiring such computation) that requires an
     adjustment to the Conversion Price pursuant to Section 12.4(a), (b), (c),
     (d), (e) or (f) occurs on or after the "ex" date for the issuance or
     distribution requiring such computation and prior to the day in question,
     the Closing Price for each Trading Day on and after the "ex" date for such
     other event shall be adjusted by multiplying such Closing Price by the
     reciprocal of the fraction by which the Conversion Price is so required to
     be adjusted as a result of such other event, and (3) if the "ex" date for
     the issuance or distribution requiring such computation is prior to the day
     in question, after taking into account any adjustment required

                                       86
<PAGE>

     pursuant to clause (1) or (2) of this proviso, the Closing Price for each
     Trading Day on or after such "ex" date shall be adjusted by adding thereto
     the amount of any cash and the fair market value (as determined by the
     Board of Directors in a manner consistent with any determination of such
     value for purposes of Section 12.4(d) or (f), whose determination shall be
     conclusive and described in a Board Resolution) of the evidences of
     indebtedness, shares of capital stock or assets being distributed
     applicable to one share of Common Stock as of the close of business on the
     day before such "ex" date. For purposes of any computation under Section
     12.4(f), the Current Market Price of the Common Stock on any date shall be
     deemed to be the average of the daily Closing Prices per share of Common
     Stock for such day and the next two succeeding Trading Days; provided,
                                                                  --------
     however, that if the"ex" date for any event (other than the tender offer
     -------
     requiring such computation) that requires an adjustment to the Conversion
     Price pursuant to Section 12.4(a), (b), (c), (d), (e) or (f) occurs on or
     after the Expiration Time for the tender or exchange offer requiring such
     computation and prior to the day in question, the Closing Price for each
     Trading Day on and after the "ex" date for such other event shall be
     adjusted by multiplying such Closing Price by the reciprocal of the
     fraction by which the Conversion Price is so required to be adjusted as a
     result of such other event. For purposes of this paragraph, the term "ex"
     date, (1) when used with respect to any issuance or distribution, means the
     first date on which the Common Stock trades regular way on the relevant
     exchange or in the relevant market from which the Closing Price was
     obtained without the right to receive such issuance or distribution, (2)
     when used with respect to any subdivision or combination of shares of
     Common Stock, means the first date on which the Common Stock trades regular
     way on such exchange or in such market after the time at which such
     subdivision or combination becomes effective, and (3) when used with
     respect to any tender or exchange offer means the first date on which the
     Common Stock trades regular way on such exchange or in such market after
     the Expiration Time of such offer. Notwithstanding the foregoing, whenever
     successive adjustments to the Conversion Price are called for pursuant to
     this Section 12.4, such adjustments shall be made to the Current Market
     Price as may be necessary or appropriate to effectuate the intent of this
     Section 12.4 and to avoid unjust or inequitable results as determined in
     good faith by the Board of Directors.

          (2) "fair market value" shall mean the amount which a willing buyer
     would pay a willing seller in an arm's length transaction.

          (3) "Record Date" shall mean, with respect to any dividend,
     distribution or other transaction or event in which the holders of Common
     Stock

                                       87
<PAGE>

     have the right to receive any cash, securities or other property or
     in which the Common Stock (or other applicable security) is exchanged for
     or converted into any combination of cash, securities or other property,
     the date fixed for determination of stockholders entitled to receive such
     cash, securities or other property (whether such date is fixed by the Board
     of Directors or by statute, contract or otherwise).

     (h) The Company may make such reductions in the Conversion Price, in
addition to those required by Sections 12.4(a), (b), (c), (d), (e) or (f), as
the Board of Directors considers to be advisable to avoid or diminish any income
tax to holders of Common Stock or rights to purchase Common Stock resulting from
any dividend or distribution of stock (or rights to acquire stock) or from any
event treated as such for income tax purposes.

     To the extent permitted by applicable law, the Company from time to time
may reduce the Conversion Price by any amount for any period of time if the
period is at least twenty (20) days and the reduction is irrevocable during the
period.  Whenever the Conversion Price is reduced pursuant to the preceding
sentence, the Company shall mail to each Holder at the address of such Holder as
it appears in the Security appearing on the Register a notice of the reduction
at least fifteen (15) days prior to the date the reduced Conversion Price takes
effect, and such notice shall state the reduced Conversion Price and the period
during which it will be in effect.

     (i) No adjustment in the Conversion Price shall be required unless such
adjustment would require an increase or decrease of at least 1% in such price;
provided, however, that any adjustments which by reason of this Section 12.4 (i)
--------  -------
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Article 12 shall be made
by the Company and shall be made to the nearest cent or to the nearest one
hundredth of a share, as the case may be. No adjustment need be made for a
change in the par value or no par value of the Common Stock.

     (j) In any case in which this Section 12.4 provides that an adjustment
shall become effective immediately after a Record Date for an event, the Company
may defer until the occurrence of such event (i) issuing to the Holder of any
Security converted after such Record Date and before the occurrence of such
event the additional shares of Common Stock issuable upon such conversion by
reason of the adjustment required by such event over and above the Common Stock
issuable upon such conversion before giving effect to such adjustment and (ii)
paying to such holder any amount in cash in lieu of any fraction pursuant to
Section 12.3.

                                       88
<PAGE>

     (k) For purposes of this Section 12.4, the number of shares of Common Stock
at any time outstanding shall not include shares held in the treasury of the
Company but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of shares of Common Stock. The Company will not pay
any dividend or make any distribution on shares of Common Stock held in the
treasury of the Company.

     (l) In lieu of making any adjustment to the Conversion Price pursuant to
Section 12.4(d) or (e), the Company may elect to reserve an amount of cash for
distribution to the Holders of the Securities upon the conversion of the
Securities so that any such Holder converting Securities will receive upon such
conversion, in addition to the shares of Common Stock and other items to which
such Holder is entitled, the full amount of cash which such holder would have
received if such Holder had, immediately prior to the Record Date for such
distribution of cash, converted its Securities into Common Stock, together with
any interest accrued with respect to such amount, in accordance with this
Section 12.4(l).  The Company may make such election by providing an Officers'
Certificate to the Trustee to such effect on or prior to the payment date for
any such distribution and depositing with the Trustee on or prior to such date
an amount of cash equal to the aggregate amount the Holders of the Securities
would have received if such Holders had, immediately prior to the Record Date
for such distribution, converted all of the Securities into Common Stock.  Any
such funds so deposited by the Company with the Trustee shall be invested by the
Trustee in marketable obligations issued or fully guaranteed by the United
States government with a maturity not more than three (3) months from the date
of issuance.  Upon conversion of Securities by a Holder, the Holder will be
entitled to receive, in addition to the Common Stock issuable upon conversion,
an amount of cash equal to the amount such Holder would have received if such
Holder had, immediately prior to the Record Date for such distribution,
converted its Security into Common Stock, along with such Holder's pro rata
share of any accrued interest earned as a consequence of the investment of such
funds.  Promptly after making an election pursuant to this Section 12.4(l), the
Company shall give or shall cause to be given notice to all Holders of such
election, which notice shall state the amount of cash per $1,000 principal
amount of Securities such Holders shall be entitled to receive (excluding
interest) upon conversion of the Securities as a consequence of the Company
having made such election.

     SECTION 12.5  Notice of Adjustments of Conversion Price.

     Whenever the Conversion Price is adjusted as herein provided:

          (1) the Company shall compute the adjusted Conversion Price in
     accordance with Section 12.4 and shall prepare an Officers' Certificate
     signed by

                                       89
<PAGE>

     the Chief Financial Officer of the Company setting forth the
     adjusted Conversion Price and showing in reasonable detail the facts upon
     which such adjustment is based, and such Officers' Certificate shall
     forthwith promptly be filed with the Trustee and with each Conversion
     Agent; and

          (2) a notice stating that the Conversion Price has been adjusted and
     setting forth the adjusted Conversion Price and the date on which each
     adjustment becomes effective shall forthwith be required, and such notice
     shall be provided by the Company to all Holders in accordance with Section
     1.5.

Neither the Trustee nor any Conversion Agent shall be under any duty or
responsibility with respect to the validity, accuracy or sufficiency of any such
Officers' Certificate, except to exhibit the same to any Holder of Securities
desiring inspection thereof at its office during normal business hours.

     SECTION 12.6  Notice of Certain Corporate Action.

     In case at any time after the date hereof:

          (1) the Company shall declare a dividend (or any other distribution)
     on its Common Stock payable otherwise than in cash out of its capital
     surplus or the consolidated retained earnings of the Company and its
     Subsidiaries; or

          (2) the Company shall authorize the granting to the holders of its
     Common Stock of rights or warrants to subscribe for or purchase any shares
     of capital stock of any class or of any other rights; or

          (3) there shall occur any reclassification of the Common Stock of the
     Company (other than a subdivision or combination of its outstanding shares
     of Common Stock), or any consolidation or merger to which the Company is a
     party and for which approval of any shareholders of the Company is
     required, or the conveyance, transfer or lease of all or substantially all
     of the assets of the Company; or

          (4) there shall occur the voluntary or involuntary dissolution,
     liquidation or winding up of the Company.

then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of securities pursuant to Section 9.2, and shall cause
to be provided to all Holders in accordance with Section 1.5, at least 20 days
(or 10 days in any case specified in clause (1) or (2) above) prior to the
applicable record or effective date

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hereinafter specified, a notice stating (A) the date on which a record is to be
taken for the purpose of such dividend, distribution, rights or warrants, or, if
a record is not to be taken, the date as of which the holders of Common Stock of
record to be entitled to such dividend, distribution, rights or warrants are to
be determined, or (B) the date on which such reclassification, consolidation,
merger, conveyance, transfer, lease, dissolution, liquidation or winding up is
expected to become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, conveyance, transfer, lease,
dissolution, liquidation or winding up.

     SECTION 12.7  Company to Reserve Common Stock.

     The Company shall at all times use its best efforts to 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 fully paid and nonassessable Common Stock then issuable
upon the conversion of all Outstanding Securities.

     SECTION 12.8  Taxes on Conversions.

     Except as provided in the next sentence, the Company will pay any and all
taxes (other than taxes on income) and duties that may be payable in respect of
the issue or delivery of shares of Common Stock on conversion of Securities
pursuant hereto.  A Holder delivering a Security for conversion shall be liable
for and will be required to pay any tax or duty which may be payable in respect
of any transfer involved in the issue and delivery of shares of 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 duty, or has established to the satisfaction of the Company that such tax or
duty has been paid.

     SECTION 12.9  Covenant as to Common Stock.

     The Company covenants that all shares of Common Stock which may be issued
upon conversion of Securities will upon issue be fully paid and nonassessable
and, except as provided in Section 12.8, the Company will pay all taxes, liens
and charges with respect to the issue thereof.

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     SECTION 12.10  Cancellation of Converted Securities.

     All Securities delivered for conversion shall be delivered to the Trustee
to be canceled by or at the direction of the Company, which shall dispose of the
same as provided in Section 2.9.

     SECTION 12.11  Effect of Reclassification, Consolidation, Merger or Sale.

     If any of following events occur, namely (i) any reclassification or change
of the outstanding shares of Common Stock (other than a change in par value, or
from par value to no par value, or from no par value to par value, or as a
result of a subdivision or combination), (ii) any consolidation, merger or
combination of the Company with another corporation as a result of which holders
of Common Stock shall be entitled to receive stock, securities or other property
or assets (including cash) with respect to or in exchange for such Common Stock
or (iii) any sale or conveyance of the properties and assets of the Company as,
or substantially as, an entirety to any other corporation as a result of which
holders of Common Stock shall be entitled to receive stock, securities or other
property or assets (including cash) with respect to or in exchange for such
Common Stock, then the Company or the successor or purchasing corporation, as
the case may be, shall execute with the Trustee a supplemental indenture (which
shall comply with the Trust Indenture Act as in force at the date of execution
of such supplemental indenture if such supplemental indenture is then required
to so comply) providing that such Security shall be convertible into the kind
and amount of shares of stock and other securities or property or assets
(including cash) which such Holder would have been entitled to receive upon such
reclassification, change, consolidation, merger, combination, sale or conveyance
had such Securities been converted into Common Stock immediately prior to such
reclassification, change, consolidation, merger, combination, sale or conveyance
assuming such holder of Common Stock did not exercise its rights of election, if
any, as to the kind or amount of securities, cash or other property receivable
upon such consolidation, merger, statutory exchange, sale or conveyance
(provided that, if the kind or amount of securities, cash or other property
receivable upon such consolidation, merger, statutory exchange, sale or
conveyance is not the same for each share of Common Stock in respect of which
such rights of election shall not have been exercised ("Non-Electing Share"),
then for the purposes of this Section 12.11 the kind and amount of securities,
cash or other property receivable upon such consolidation, merger, statutory
exchange, sale or conveyance for each Non-Electing Share shall be deemed to be
the kind and amount so receivable per share by a plurality of the Non-Electing
Shares).  Such supplemental indenture shall provide for adjustments which shall
be as nearly equivalent as may be practicable to the adjustments provided for in
this Article.  If, in the case of any such reclassification, change,
consolidation, merger, combination, sale or conveyance, the

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stock or other securities and assets receivable thereupon by a holder of shares
of Common Stock includes shares of stock or other securities and assets of a
corporation other than the successor or purchasing corporation, as the case may
be, in such reclassification, change, consolidation, merger, combination, sale
or conveyance, then such supplemental indenture shall also be executed by such
other corporation and shall contain such additional provisions to protect the
interests of the Holders of the Securities as the Board of Directors shall
reasonably consider necessary by reason of the foregoing, including to the
extent practicable the provisions providing for the Repurchase Rights set forth
in Article 11 herein.

     The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each Holder, at the address of such Holder as it
appears on the Security Register, within twenty (20) days after execution
thereof.  Failure to deliver such notice shall not affect the legality or
validity of such supplemental indenture.

     The above provisions of this Section shall similarly apply to successive
reclassifications, changes, consolidations, mergers, combinations, sales and
conveyances.

     If this Section 12.11 applies to any event or occurrence, Section 12.4
shall not apply.

     SECTION 12.12  Responsibility of Trustee for Conversion Provisions.

     The Trustee, subject to the provisions of Section 5.1, and any Conversion
Agent shall not at any time be under any duty or responsibility to any Holder of
Securities to determine whether any facts exist which may require any adjustment
of the Conversion Price, or with respect to the nature or intent of any such
adjustments when made, or with respect to the method or calculations employed,
or herein or in any supplemental indenture provided to be employed, in making
the same.  Neither the Trustee, subject to the provisions of Section 5.1, nor
any Conversion Agent shall be accountable with respect to the validity or value
(of the kind or amount) of any Common Stock, or of any other securities or
property, which may at any time be issued or delivered upon the conversion of
any Security; and it or they do not make any representation with respect
thereto.  Neither the Trustee, subject to the provisions of Section 5.1, nor any
Conversion Agent shall be responsible for any failure of the Company to make any
cash payment or to issue, transfer or deliver any shares of stock or share
certificates or other securities or property upon the surrender of any Security
for the purpose of conversion; and the Trustee, subject to the provisions of
Section 5.1, and any Conversion Agent shall not be responsible or liable for any
failure of the Company to comply with any of the covenants of the Company
contained in this Article.

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                                  ARTICLE 13

                                 SUBORDINATION

     SECTION 13.1  Securities Subordinated to Senior Debt.

     The Company covenants and agrees, and each Holder of Securities, by such
Holder's acceptance thereof, likewise covenants and agrees, that the
indebtedness represented by the Securities and the payment of the principal of
and premium, if any, and interest (including Liquidated Damages, if any) on each
and all of the Securities is hereby expressly subordinate and junior, to the
extent and in the manner hereinafter set forth and as set forth in Section 3.1,
in right of payment to the prior payment in full of all Senior Debt.

     (a) In the event of any distribution of assets of the Company upon any
dissolution, winding up, liquidation or reorganization of the Company, whether
in bankruptcy, insolvency, reorganization or receivership proceedings or upon an
assignment for the benefit of creditors or any other marshalling of the assets
and liabilities of the Company or otherwise, then the holders of all Senior Debt
shall first be entitled to receive payment of the full amount due thereon in
respect of principal and premium, if any, and interest (including interest
accruing after the commencement of any bankruptcy proceeding, regarding of
whether such interests is an allowed claim in such proceeding) and all other
amounts due or provision shall be made for such amount in cash before the
Holders of any of the Securities are entitled to receive any payment or
distribution of any character, whether in cash, securities or other property, on
account of the principal of or premium, if any, or interest on the indebtedness
evidenced by the Securities.

     (b) In the event of any default in payment of the principal of or premium,
if any, or interest on any Senior Debt, then, unless and until all such payments
due in respect of such Senior Debt have been paid in full or such default shall
have been cured or waived or shall have ceased to exist, no payment shall be
made by the Company with respect to the principal of, premium, if any, or
interest (including Liquidated Damages, if any) on the Securities or to acquire
any of the Securities (including any redemption, cash conversion or repurchase
pursuant to the exercise of the Repurchase Right).

     (c) During the continuance of any event of default with respect to any
Senior Debt, as such event of default is defined under any such Senior Debt or
in any agreement pursuant to which any Senior Debt has been issued (other than a
default in payment of the principal of or premium, if any, or interest on any
Senior Debt), permitting the holder or

                                       94
<PAGE>

holders of such Senior Debt to accelerate the maturity thereof, no payment shall
be made by the Company, directly or indirectly, with respect to principal of,
premium, if any, or interest (including Liquidated Damages, if any) on the
Securities (including any redemption, cash conversion or repurchase pursuant to
the exercise of the Repurchase Right) for 180 days following notice in writing
to the Company, from any holder or holders of such Senior Debt or their
representative or representatives or the trustee or trustees under any indenture
or under which any instrument evidencing any such Senior Debt may have been
issued, that such an event of default has occurred and is continuing, unless
such event of default has been cured or waived or such Senior Debt has been paid
in full; provided, however, if the maturity of such Senior Debt is accelerated,
         --------  -------
no payment may be made on the Securities until such Senior Debt has been
paid or such acceleration has been cured or waived. For purposes of this Section
13.1(c), such notice shall be deemed to include notice of all other events of
default under such indenture or instrument, which are continuing at the time of
the event of default specified in such notice. The provisions of this Section
13.1(c) shall apply only to one such notice given in any period of nine
consecutive months with respect to any issue of Senior Debt and no more than one
such notice under this Section 13.1(c) shall be given with respect to any such
continuing event of default under any issue of Senior Debt for such nine-month
period.

     (d) In the event that, notwithstanding the foregoing provisions of Sections
13.1(a), (b) and (c), any payment on account of principal, premium, if any, or
interest (including Liquidated Damages, if any) on the Securities shall be made
by or on behalf of the Company and received by the Trustee, by any Holder or by
any Paying Agent (or, if the Company is acting as its own Paying Agent, money
for any such payment shall be segregated and held in trust), (i) after the
occurrence of an event specified in Section 13.1(a), then, unless and until all
Senior Debt is paid in full in cash, or provision shall he made therefor, (ii)
after the happening of an event of default under any Senior Debt of the type
specified in Section 13.1(b) above, then, unless and until the amount of such
Senior Debt then due shall have been paid in full, or provision made therefor or
such event of default shall have been cured or waived, or (iii) after the
happening of an event of default of the type specified in Section 13.1(c) above,
unless and until such event of default shall have been cured or waived or the
180-day period specified in Section 13.1(c) shall have expired, such payment
(subject, in each case, to the provisions of Section 13.7) shall be held in
trust for the benefit of, and shall be immediately paid over to, the holders of
Senior Debt or their representative or representatives or the trustee or
trustees under any indenture under which any instruments evidencing any of the
Senior Debt may have been issued, as their interests my appear.  The Company
shall give prompt written notice to the Trustee of any default under any

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<PAGE>

Senior Debt or under any agreement pursuant to which Senior Debt may have been
issued.

     SECTION 13.2  Subrogation.

     Subject to the payment in full of all Senior Debt to which the indebtedness
evidenced by the Securities is in the circumstances subordinated as provided in
Section 13.1, the Holders of the Securities shall be subrogated to the rights of
the holders of such Senior Debt to receive payments or distributions of cash,
property or securities of the Company applicable to such Senior Debt until all
amounts owing on the Securities shall be paid in full, and, as between the
Company, its creditors other than holders of such Senior Debt, and the Holders
of the Securities, no such payment or distribution made to the holders of Senior
Debt by virtue of this Article which otherwise would have been made to the
holders of the Securities shall be deemed to be a payment by the Company on
account of such Senior Debt, it being understood that the provisions of this
Article are and are intended solely for the purpose of defining the relative
rights of the Holders of the Securities, on the one hand, and the holders of
Senior Debt, on the other hand.

     SECTION 13.3  Obligation of Company Unconditional.

     Nothing contained in this Article or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as between the Company, its creditors
other than the holders of Senior Debt, and the Holders of the Securities, the
obligation of the Company, which is absolute and unconditional, to pay to the
Holders of the Securities the principal of and premium, if any, and interest
(including Liquidated Damages, if any) on the Securities as and when the same
shall become due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the Holders of the Securities and
creditors of the Company other than the holders of Senior Debt, nor shall
anything herein or therein prevent the Trustee or the Holder of any Security
from exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article of the
holders of Senior Debt in respect of cash, property or securities of the Company
received upon the exercise of any such remedy.

     SECTION 13.4  Maturity of or Default on Senior Debt.

     Upon the maturity of any Senior Debt by lapse of time, acceleration or
otherwise, then all principal of and interest on all such matured Senior Debt
shall first be paid in full, or such payment shall have been duly provided for,
before any payment on account of principal, or premium, if any, or interest
(including Liquidated Damages, if any) is made upon the Securities.

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<PAGE>

     SECTION 13.5  Payments on Securities Permitted.

     Except as expressly provided in this Article, nothing contained in this
Article shall affect the obligation of the Company to make, or prevent the
Company from making, payments of the principal of, or premium, if any, or
interest (including Liquidated Damages, if any) on the Securities in accordance
with the provisions hereof and thereof, or shall prevent the Trustee or any
Paying Agent from applying any moneys deposited with it hereunder to the payment
of the principal of, or premium, if any, or interest (including Liquidated
Damages, if any) on the Securities.

     SECTION 13.6  Effectuation of Subordination by Trustee.

     Each Holder of Securities, by such Holder's acceptance thereof, authorizes
and directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article and appoints the Trustee such Holder's attorney-in-fact for any and all
such purposes.

     Upon any payment or distribution of assets of the Company referred to in
this Article, the Trustee and the Holders of the Securities shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction in
which any such dissolution, winding up, liquidation or reorganization proceeding
affecting the affairs of the Company is pending or upon a certificate of the
trustee in bankruptcy, receiver, assignee for the benefit of creditors,
liquidating trustee or agent or other Person making any payment or distribution,
delivered to the Trustee or to the Holders of the Securities, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, and as to other facts pertinent to the right of such Persons under
this Article, and if such evidence is not furnished, the Trustee may defer any
payment to such Persons pending judicial determination as to the right of such
Persons to receive such payment.

     SECTION 13.7  Knowledge of Trustee.

     Notwithstanding the provision of this Article or any other provisions of
this Indenture, the Trustee shall not be charged with knowledge of the existence
of any Senior Debt, of any default in payment of principal of, premium, if any,
or interest on any Senior Debt, or of any facts which would prohibit the making
of any payment of moneys to or by the Trustee, or the taking of any other action
by the Trustee, unless and until a Responsible Officer of the Trustee having
responsibility for the administration of the trust established by this Indenture
shall have received written notice thereof from the Company, any Holder of
Securities, any Paying or Conversion Agent of the Company or the holder or
representative of any class of Senior Debt, and, prior to the receipt of any
such written notice, the Trustee shall be entitled in all respects to assume
that no such

                                       97
<PAGE>

default or facts exist; provided, however, that unless on the third
                        --------  -------
Business Day prior to the date upon which by the terms hereof any such moneys
may become payable for any purpose the Trustee shall have received the notice
provided for in this Section 13.7, then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
receive such moneys and apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary which may be
received by it on or after such date.

     SECTION 13.8  Trustee's Relation to Senior Debt.

     The Trustee shall be entitled to all the rights set forth in this Article
with respect to any Senior Debt at the time held by it, to the same extent as
any other holder of Senior Debt and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.

     Nothing in this Article shall apply to claims of or payments to the Trustee
under or pursuant to Section 5.7.

     With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article, and no implied covenants or obligations
with respect to the holders of Senior Debt shall be read into this Indenture
against the Trustee.  The Trustee shall not be deemed to owe any fiduciary duty
to the holders of Senior Debt and the Trustee shall not be liable to any holder
of Senior Debt if it shall pay over or deliver to Holders, the Company or any
other Person moneys or assets to which any holder of Senior Debt shall be
entitled by virtue of this Article or otherwise.

     SECTION 13.9  Rights of Holders of Senior Debt Not Impaired.

     No right of any present or future holder of any Senior Debt to enforce the
subordination herein shall at any time or in any way be prejudiced or impaired
by any act or failure to act on the part of the Company or by any noncompliance
by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.

     SECTION 13.10  Modification of Terms of Senior Debt.

     Any renewal or extension of the time of payment of any Senior Debt or the
exercise by the holders of Senior Debt of any of their rights under any
instrument creating or evidencing Senior Debt, including without limitation the
waiver of default thereunder,

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<PAGE>

may be made or done all without notice to or assent from the Holders of the
Securities or the Trustee.

     No compromise, alteration, amendment, modification, extension, renewal or
other change of, or waiver, consent or other action in respect of, any liability
or obligation under or in respect of, or of any of the terms, covenants or
conditions of any indenture or other instrument under which any Senior Debt is
outstanding or of such Senior Debt, whether or not such release is in accordance
with the provisions or any applicable document, shall in any way alter or affect
any of the provisions of this Article or of the Securities relating to the
subordination thereof.

                                   ARTICLE 14

                           INTEREST RATE ADJUSTMENTS

     SECTION 14.1  Occurrence of Reset Transaction and Adjustment to the
Interest Rate.

     If a Reset Transaction occurs, the interest rate will be adjusted to equal
the Adjusted Interest Rate from the effective date of such Reset Transaction to,
but not including, the effective date of any succeeding Reset Transaction.

     The "Adjusted Interest Rate" with respect to any Reset Transaction will be
the rate per annum that is the arithmetic average of the rates quoted by two
Reference Dealers selected by the Company or its successor as the rate at which
the interest rate should accrue so that the fair market value, expressed in
dollars, of a Security immediately after the later of:  (1) the public
announcement of such Reset Transaction or (2) the public announcement of a
change in dividend policy in connection with such Reset Transaction will equal
the average Closing Price of a Security for the 20 Trading Days preceding the
date of a public announcement of such Reset Transaction; provided that the
Adjusted Interest Rate will not be less than 5 1/4% per annum.

     "Dividend Yield" on any security for any period means the dividends paid or
proposed to be paid pursuant to an announced dividend policy on such security
for such period divided by, if with respect to dividends paid on such security,
the average Closing Price of such security during such period and, if with
respect to dividends proposed to be paid on such security, the Closing Price of
such security on the effective date of the related Reset Transaction.

     "Reference Dealer" means a dealer engaged in the trading of convertible
securities.

                                       99
<PAGE>

           [The rest of this page has intentionally been left blank.]

                                      100
<PAGE>

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

                                             VERTICALNET, INC.

                                             By: _______________________________
                                                 Name:
                                                 Title:

Attest:

By:  ____________________________
     Name:
     Title:


                                             BANKERS TRUST COMPANY
                                             as Trustee


                                             By: _______________________________
                                                 Name:
                                                 Title:

                                      101
<PAGE>

                          EXHIBIT A - FORM OF SECURITY

                           [FORM OF FACE OF SECURITY]

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

THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS,
AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE
ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE.  BY ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) OR (B) IT IS AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2),
(3), (5), (6) OR (7) UNDER THE SECURITIES ACT) ("ACCREDITED INVESTOR"); (2)
AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THE
SECURITY EVIDENCED HEREBY RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED
HEREBY OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH SECURITY EXCEPT (A)
TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A
QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES
ACT, (C) INSIDE THE UNITED STATES TO AN ACCREDITED INVESTOR THAT, PRIOR TO SUCH
TRANSFER, FURNISHES TO THE BANKERS TRUST COMPANY, AS TRUSTEE, A SIGNED LETTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS
ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE
OBTAINED FROM SUCH TRUSTEE), (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER

                                      102
<PAGE>

THE SECURITIES ACT (IF AVAILABLE), OR (E) PURSUANT TO A REGISTRATION STATEMENT
WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH CONTINUES
TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER); AND (3) AGREES THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED
(OTHER THAN A TRANSFER PURSUANT TO 2(E) ABOVE) A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED
HEREBY WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THE SECURITY (OTHER THAN
A TRANSFER PURSUANT TO CLAUSE 2(E) ABOVE), THE HOLDER MUST CHECK THE APPROPRIATE
BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND
SUBMIT THIS CERTIFICATE TO BANKERS TRUST COMPANY, AS TRUSTEE (OR ANY SUCCESSOR
TRUSTEE, AS APPLICABLE). IF THE PROPOSED TRANSFER IS PURSUANT TO CLAUSE 2(C) OR
2(D) ABOVE, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO BANKERS TRUST
COMPANY, AS TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE COMPANY MAY
REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED UPON THE EARLIER
OF THE TRANSFER OF THE SECURITY EVIDENCED HEREBY PURSUANT TO CLAUSE 2(E) ABOVE
OR THE EXPIRATION OF TWO YEARS FROM THE ORIGINAL ISSUANCE OF THE SECURITY
EVIDENCED HEREBY. AS USED HEREIN, THE TERMS "UNITED STATES" AND "U.S. PERSON"
HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.

                                      103
<PAGE>

                               VERTICALNET, INC.

               5 1/4% CONVERTIBLE SUBORDINATED DEBENTURE DUE 2004

No.  $

     VERTICALNET, INC., a corporation duly organized and existing under the laws
of the State of Pennsylvania (herein called the "Company," which term includes
any successor corporation under the Indenture referred to on the reverse
hereof), for value received, hereby promises to pay to ________________, or
registered assigns, the principal sum of U.S. Dollars on _______________ and to
pay interest (including Liquidated Damages, if any) thereon, from September 27,
1999 or from the most recent Interest Payment Date to which interest has been
paid or duly provided for, semiannually in arrears on March 27 and September 27
each year (each an "Interest Payment Date"), commencing March 27, 2000, at the
rate of 5 1/4% per annum, until the principal hereof is paid or made available
for payment. The interest (including Liquidated Damages, if any) so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the Person in whose name this Security (or
one or more Predecessor Securities) is registered at the close of business on
the Regular Record Date for such interest, which shall be March 13 (whether or
not a Business Day) next preceding a March 27 Interest Payment Date and
September 13 (whether or not a Business Day) next preceding a September 27
Interest Payment Date. Except as otherwise provided in the Indenture, any such
interest (including Liquidated Damages, if any) not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid to the Person in whose name this Security (or
one or more Predecessor Securities) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by
the Trustee, notice whereof shall be given to Holders of Securities not less
than 10 days prior to such Special Record Date, or be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture. Payments
of principal and premium, if any, shall be made upon the surrender of this
Security at the option of the Holder at the Corporate Trust Office of the
Trustee, or at such other office or agency of the Company as may be designated
by it for such purpose in The City of New York, in such coin or currency of the
United States of America as at the time of payment shall be legal tender for the
payment of public and private debts. Payment of interest (including Liquidated
Damages, if any) on this Security may be made by U.S. Dollar check drawn on a
bank in The City of New York mailed to the address of the Person entitled
thereto as such address
                                      104
<PAGE>

shall appear in the Security Register, or upon application by the Holder to the
Security Registrar not later than the relevant Record Date, by wire transfer to
a U.S. Dollar account (to Holders of an aggregate principal amount in excess of
U.S. $5,000,000).

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

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

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

Dated:  September 27, 1999

                                            VERTICALNET, INC.


[Corporate Seal]                            By:_________________________________
Attest:

                    TRUSTEE'S CERTIFICATE OF AUTHENTICATION
                    ---------------------------------------

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

                                            BANKERS TRUST COMPANY,
                                            as Trustee

                                            By:_________________________________
                                            Authorized Signatory

                                      105
<PAGE>

                         [FORM OF REVERSE OF SECURITY]

                               VERTICALNET, INC.

               5 1/4% CONVERTIBLE SUBORDINATED DEBENTURE DUE 2004

     This Security is one of a duly authorized issue of Securities of the
Company designated as its "5 1/4% Convertible Subordinated Debentures Due 2004"
(herein called the "Securities"), limited in aggregate principal amount to U.S.
$100,000,000 (subject to increase as provided in the Indenture (as hereinafter
defined) of up to an additional $15,000,000 aggregate principal amount), issued
and to be issued under an Indenture, dated as of September 27, 1999 (herein
called the "Indenture"), between the Company and Bankers Trust Company, as
Trustee (herein called the "Trustee," which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee, the
holders of Senior Debt, and the Holders of the Securities and of the terms upon
which the Securities are, and are to be, authenticated and delivered.  The
Securities are issuable in registered form, without coupons, in denominations of
U.S. $1,000 and integral multiples thereof.  As provided in the Indenture and
subject to certain limitations therein set forth, Securities are exchangeable
for a like aggregate principal amount of Securities of any authorized
denominations as requested by the Holder surrendering the same upon surrender of
the Security or Securities to be exchanged, except as provided below, at the
office or agency of the Company in The City of New York, or at such other
offices or agencies as the Company may designate.

     If a Reset Transaction occurs, the interest rate will be adjusted to equal
the Adjusted Interest Rate from the effective date of such Reset Transaction to,
but not including, the effective date of any succeeding Reset Transaction.
"Reset Transaction" means a merger, consolidation or statutory share exchange to
which the entity that is the issuer of the common shares into which the
Securities are then convertible into is a party, a sale of all or substantially
all the assets of that entity, a recapitalization of those common shares or a
distribution described in Section 12.4(d) of the Indenture, after the effective
date of which transaction or distribution the Securities would be convertible
into (a) shares of an entity the common shares of which had a Dividend Yield for
the four fiscal quarters of such entity immediately preceding the public
announcement of such transaction or distribution that was more than 2.5% higher
than the Dividend Yield on the Common Stock (or other common shares then
issuable upon conversion of the Securities) for the four fiscal quarters
preceding the public announcement of such transaction or distribution, or (b)
shares of an entity that announces a dividend policy prior to the

                                      106
<PAGE>

effective date of such transaction or distribution which policy, if implemented,
would result in a Dividend Yield on such entity's common stock for the next four
fiscal quarters that would result in such 2.5% basis point increase. The
"Adjusted Interest Rate," with respect to any Reset Transaction, will be the
rate per annum that is the arithmetic average of the rate quoted by two
Reference Dealers selected by the Company or its successor as the rate at which
the interest rate should accrue so that the fair market value, expressed in
dollars, of a Security immediately after the later of (1) the public
announcement of such Reset Transaction or (2) the public announcement of a
change in dividend policy in connection with such Reset Transaction, will equal
the average Closing Price of a Security for 20 Trading Days preceding the date
of public announcement of such Reset Transaction; provided that the Adjusted
Interest Rate will not be less than 5 1/4% per annum. The "Dividend Yield" on
any security for any period means the dividends paid or proposed to be paid
pursuant to an announced dividend policy on such security for such period
divided by, if with respect to dividends paid on such security, the average
Closing Price of such security during such period and, if with respect to
dividends proposed to be paid on such security, the Closing Price of such
security on the effective date of the related Reset Transaction. "Reference
Dealer" means a dealer engaged in the trading of convertible securities.

     The Securities may be redeemed by the Company (a "Provisional Redemption"),
in whole or in part, at any time prior to September 27, 2002, upon notice as set
forth in Section 10.5 of the Indenture at a redemption price equal to 101.3125%
of the principal amount of Securities, plus accrued and unpaid interest, if any
(including Liquidated Damages), to but excluding the date of Provisional
Redemption (the "Provisional Redemption Date") if (i) the Current Market Value
(as hereinafter defined) of the Common Stock shall equal or exceed the following
triggering percentages of the Conversion Price then in effect for at least 20
Trading Days in any consecutive 30-day Trading Day period ending on the Trading
Day prior to the date of mailing of the notice of the Provisional Redemption
(the "Notice Date"), if redeemed in the 12-month period ending on September 26
of the following years:  (A) 2000 - 170%, (B) 2001 - 160%, and (C) 2002 - 150%;
and (ii) the shelf registration covering resales of the Securities and the
Common Stock issuable upon conversion of the Securities is effective and
available for use and is expected to remain effective and available for use for
the 30 days following the Provisional Redemption Date.

     Upon any Provisional Redemption, the Company shall make an additional
payment (the "Interest Make-Whole Payment") in cash with respect to the
Securities called for redemption, including those Securities converted into
Common Stock between the Notice Date and the Provisional Redemption Date, in an
amount equal to the sum of (i) the present value of the aggregate amount of the
interest that would otherwise have

                                      107
<PAGE>

accrued from the Provisional Redemption Date through September 26, 2002 (the
"Interest Make-Whole Period") and (ii) Liquidated Damages, if any, to the
Provisional Redemption Date. The Company shall make the Interest Make-Whole
Payment on all Securities called for Provisional Redemption including any
Securities converted after the Notice Date and prior to the Provisional
Redemption Date. Such present value shall be calculated using the bond
equivalent yield on U.S. Treasury notes or bills having a term nearest in length
to that of the Interest Make-Whole Period as of the Notice Date.

     The "Current Market Value" means the average of the high and low sales
prices of the Common Stock, as reported on the Nasdaq National Market or any
national securities exchange on which the Common Stock is then listed, on such
Trading Day.

     The Securities may also be redeemed by the Company at any time on or after
September 27, 2002, in whole or in part, at the election of the Company, at
Redemption Prices (expressed as percentages of the principal amount) set forth
below if redeemed during the twelve-month period beginning on September 27 of
the years indicated and ending on September 26 of the following year:

<TABLE>
<S>                                                   <C>
2002................................................. 101.3125%
2003................................................. 100.0%
2004 and thereafter.................................. 100.0%
</TABLE>

     Notice of redemption will be given as provided in the Indenture.

     Upon the occurrence of a "Change of Control," the Holder has the right (the
"Repurchase Right"), at such Holder's option, to require the Company to
repurchase all or any portion of such Holder's Securities on the repurchase date
established by the Company at a price equal to 100% of the principal amount of
the Securities, together in each case with accrued interest to, but excluding,
the date fixed for redemption; provided that if such repurchase date is March 27
or September 27, then the interest payable on such date shall be paid to the
Holder on the next preceding March 13r or September 13 respectively.  The
Company shall mail to all Holders a notice of the occurrence of a Change of
Control, of the repurchase date (which shall be not less than 30 nor more than
60 days after the notice) and of the Repurchase Right arising as a result
thereof on or before 30 calendar days after the Company becomes aware of the
occurrence of such Change of Control.  At the option of the Company, the
Repurchase Price may be paid in cash or, subject to the conditions provided in
the Indenture, by delivery of shares of Common Stock having a fair market value
equal to the Repurchase Price.  For purposes of this paragraph, the fair market
value of shares of Common Stock shall be determined by the Company and shall be
equal to 95% of the average of the Closing Prices of the

                                      108
<PAGE>

Common Stock for the five consecutive Trading Days ending on and including the
third Trading Day immediately preceding the repurchase date. Whenever in this
Security there is a reference, in any context, to the principal of any Security
as of any time, such reference shall be deemed to include reference to the
Repurchase Price payable in respect of such Security to the extent that such
Repurchase Price is, was or would be so payable at such time, and express
mention of the Repurchase Price in any provision of this Security shall not be
construed as excluding the Repurchase Price so payable in those provisions of
this Security when such express mention is not made; provided, however, that for
                                                     --------  -------
the purposes of the eighth succeeding paragraph, such reference shall be deemed
to include reference to the Repurchase Price only if the Repurchase Price is
payable in cash.

     Subject to and upon compliance with the provisions of the Indenture, the
Holder of this Security is entitled, at such Holder's option, at any time
following the original issuance of the Securities and on or before the close of
business on   September 27, 2004 or in case this Security or a portion hereof is
called for redemption, then in respect of this Security or such portion hereof
until and including, but (unless the Company defaults in making the payment due
upon redemption) not after, the close of business on the second Business Day
preceding the Redemption Date, or in the case of a Change of Control for which
the Holder exercises its Repurchase Right with respect to this Security or a
portion hereof, then in respect of this Security or such portion hereof, until,
but not after, receipt of the written notice of exercise of such Repurchase
Right, to convert this Security (or any portion of the principal amount hereof
which is U.S. $1,000 or an integral multiple thereof), at the principal amount
hereof, or of such portion, into newly issued, fully paid and nonassessable
shares of Common Stock of the Company at a Conversion Price initially equal to
U.S. $40.00 aggregate principal amount of Securities for each share of Common
Stock (or at the current adjusted Conversion Price if an adjustment has been
made as provided in the Indenture), by surrender of this Security, duly endorsed
or assigned to the Company or in blank and, in case such surrender shall be made
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 (unless this
Security or the portion thereof being converted has been called for redemption
on a Redemption Date within such period), also accompanied by payment in New
York Clearing House or other funds acceptable to the Company of an amount equal
to the interest (including Liquidated Damages, if any) payable on such Interest
Payment Date on the principal amount of this Security then being converted, and
also the conversion notice hereon duly executed to the Company at the Corporate
Trust Office of the Trustee, or at such other office or agency of the Company as
may be designated by it for such purpose in The City of New York.  No payment or
adjustment will be made on conversion of this Security for interest (including
Liquidated Damages, if any) accrued hereon to the date of conversion or for
dividends on

                                      109
<PAGE>

the Common Stock issued on conversion. No fractions of shares or scrip
representing fractions of shares will be issued on conversion, but instead of
any fractional interest (calculated to the nearest 1/100th of a share) the
Company shall pay a cash adjustment as provided in the Indenture. The Conversion
Price is subject to adjustment as provided in the Indenture. In addition, the
Indenture provides that in case of certain consolidations, mergers or
conveyances to which the Company is a party or certain transfers of all or
substantially all of the assets of the Company, the Indenture shall be amended,
without the consent of any Holders of Securities, so that this Security, if then
outstanding, will be convertible thereafter, during the period this Security
shall be convertible as specified above, only into the kind and amount of
securities, cash and other property receivable upon such consolidation, merger,
conveyance or transfer by a holder of the number of shares of Common Stock of
the Company into which this Security might have been converted immediately prior
to such consolidation, merger, conveyance or transfer (assuming such holder of
Common Stock failed to exercise any rights of election, if any, as to the kind
or amount of securities, cash or other property receivable upon consolidation,
merger, conveyance or transfer and received per share the kind and amount
received per share by a plurality of nonelecting shares), assuming further, if
such consolidation, merger, conveyance or transfer is consummated before the
60th day following the latest date of original issuance of the Securities, that
this Security was convertible at the time of such consolidation, merger,
conveyance or transfer at the initial Conversion Price specified above as
adjusted from September 27, 1999 to the time of such consolidation, merger,
conveyance or transfer pursuant to the Indenture and the Company must ensure
that appropriate securities, cash or other property are placed in escrow or
otherwise reserved through the 60th day following the latest date of original
issuance of the Securities, for the benefit of Holders of Securities upon
conversion of such Securities. Adjustments in the Conversion Price of less than
one percent of such price will not be required, but any adjustment that would
otherwise be required to be made will be carried forward and taken into account
in the computation of any subsequent adjustment.

     None of the Company, the Trustee nor the Security Registrar shall be
required to exchange or register a transfer of (i) any Securities for a period
of fifteen (15) days next preceding any selection of Securities to be redeemed
or (ii) any Securities called for redemption or, if a portion of any Security is
selected or called for redemption, such portion thereof selected or called for
redemption or (iii) any Securities surrendered for conversion or, if a portion
of any Security is surrendered for conversion, such portion thereof surrendered
for conversion.

                                      110
<PAGE>

     In the event of redemption of the Securities or conversion or repurchase of
this Security in part only, a new Security or Securities for the unredeemed or
unconverted portion thereof will be issued in the name of the Holder hereof.

     Subject to certain limitations in the Indenture, at any time when the
Company is not subject to Section 13 or 15(d) of the U.S. Securities Exchange
Act of 1934, upon the request of a Holder of a Security, the Company will
promptly furnish or cause to be furnished Rule 144A Information (as defined
below) to such Holder or to a purchaser of such Security designated by such
Holder, as the case may be, in order to permit compliance by such Holder with
Rule 144A under the U.S. Securities Act of 1933, as amended (the "Securities
Act").  "Rule 144A Information" shall be such information as is specified
pursuant to Rule 144A(d)(4) under the Securities Act (or any successor provision
thereto).

     The indebtedness evidenced by this Security is, to the extent and in the
manner provided in the Indenture, subordinate and subject in right of payment to
the prior payment in full of all amounts then due on all Senior Debt of the
Company, and this Security is issued subject to such provisions of the Indenture
with respect thereto.  Each Holder of this Security, by accepting the same, (a)
agrees to and shall be bound by such provisions, (b) authorizes and directs the
Trustee on such Holder's behalf to take such action as may be necessary or
appropriate to effectuate the subordination so provided and (c) appoints the
Trustee such Holder's attorney-in-fact for any and all such purposes.

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

     The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture at
any time by the Company and the Trustee with the consent of the Holders of a
majority in principal amount of the Securities at the time Outstanding (or such
lesser amount as shall have acted at a meeting pursuant to the provisions of the
Indenture).  The Indenture also contains provisions permitting the Holders of
specified percentages in principal amount of the Securities at the time
Outstanding, on behalf of the Holders of all the Securities, to waive compliance
by the Company with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences.  Any such consent or waiver
by the Holder of this Security shall be conclusive and binding upon such Holder
and upon all future Holders of this Security and of any Security issued upon
registration of transfer

                                      111
<PAGE>

hereof or in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security or such other Security.

     No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and premium, if any, and
interest (including Liquidated Damages, if any) on this Security at the times,
places and rate, and in the coin or currency, herein prescribed or to convert
this Security (or pay cash in lieu of conversion) as provided in the Indenture.

     Pursuant to the Registration Rights Agreement, upon the effectiveness of
the Shelf Registration Statement, each Holder must notify the Company not later
than three Business Days prior to any proposed sale by such Holder of Securities
pursuant to the Shelf Registration Statement (a "Sale Notice"), which notice
shall be effective for five Business Days.  The Company may, upon written notice
to such Holder, suspend such Holder's use of the prospectus (which is part of
the Shelf Registration Statement) for a reasonable period not to exceed 60 days
if the Company in it reasonable judgment believes it may possess material non-
public information the disclosure of which would have a material adverse effect
on the Company and its subsidiaries taken as a whole.  Each Holder of this
Security, by accepting the same, agrees to hold any communication by the Company
in response to a Sale Notice in confidence.

     As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of Securities is registrable on the Security Register upon
surrender of a Security for registration of transfer at the office or agency of
the Company in The City of New York or, subject to any laws or regulations
applicable thereto and to the right of the Company to terminate the appointment
of any such Transfer Agent, at the Corporate Trust Office of the Trustee in The
City of New York or at the offices of the Transfer Agents described herein or at
such other offices or agencies as the Company may designate, duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder thereof or the
Holder's attorney duly authorized in writing, and thereupon one or more new
Securities, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.

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

                                      112
<PAGE>

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

     The Indenture and the Securities shall be governed by and construed in
accordance with the laws of the State of New York, without reference to such
State's conflict of laws principles.

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

                                      113
<PAGE>

                                   ASSIGNMENT
                                   ----------

     For value received ________________ hereby sell(s), assign(s) and
transfer(s) unto ________________ (Please insert social security or Taxpayer
Identification Number of assignee) the within Security, and hereby irrevocably
constitutes and appoints ________________________________ attorney to transfer
the said Security on the books of the Company, with full power of substitution
in the premises.

     In connection with any transfer of the within Security occurring within two
years of the original issuance of such Security (unless such Security is being
transferred pursuant to a registration statement that has been declared
effective under the Securities Act), the undersigned confirms that such Security
is being transferred:

     / /  To the Company or a subsidiary thereof; or

     / /  Pursuant to and in compliance with Rule 144A under the Securities Act
of 1933, as amended; or

     / /  Pursuant to and in compliance with Rule 144 under the Securities Act
of 1933, as amended;

and unless the box below is checked, the undersigned confirms that such Security
is not being transferred to an "affiliate" of the Company as defined in Rule 144
under the Securities Act of 1933, as amended (an "Affiliate"):

     / /  The transferee is an Affiliate of the Company.

                                      114
<PAGE>

Dated:_____________________________________



Signature(s)

Signature(s) must be guaranteed by an eligible
Guarantor Institution (banks, stock brokers,
savings and loan associations and credit unions)
with membership in an approved signature guarantee
medallion program pursuant to Securities and
Exchange Commission Rule 17Ad-15 if shares of
Common Stock are to be issued, or Securities to be
delivered, other than to and in the name of the
required holder.


___________________________________________
Signature Guarantee

NOTICE:  The signature must correspond with the name as written upon the face of
the Security in every particular without alternation or enlargement or any
change whatever.

                                      115
<PAGE>

                                                                       EXHIBIT B


                                   AI Letter

                          FORM OF PURCHASE LETTER FOR
                             ACCREDITED INVESTORS

VerticalNet, Inc.
700 Dresher Road
Horsham, PA  19044

Lehman Brothers, Inc.
Hembrecht & Quist LLC
SG Cowen Securities Corporation
Volpe Brown Whelan & Company, LLC
c/o Lehman Brothers Inc.
3 World Financial Center
New York, NY  10285

Dear Ladies and Gentlemen:

          The undersigned is delivering this letter in connection with an
offering of 5-1/4% Convertible Subordinated Debentures due 2004 (the
"Debentures"), which are convertible into shares of Common Stock, par value
$0.01 per share (the "Common Stock"), of VerticalNet, Inc. (the "Company") all
as described in the Offering Memorandum (the "Offering Memorandum") relating to
the offering.

          The undersigned hereby confirms, represents and warrants that:

            (i)     The undersigned is an "accredited investor" within the
                    meaning of Rule 501(a)(1), (2), (3), (5) or (6) under the
                    Securities Act of 1933 (the "Securities Act") or an entity
                    in which all of the equity owners are accredited investors
                    within the meaning of Rule 501(a)(1), (2), (3), (5) or (6)
                    under the Securities Act (an "Accredited Investor");

            (ii)    (A) any purchase of the Debentures by the undersigned will
                    be for the undersigned's own account or for the account of
                    one or
                    more

                                      116
<PAGE>

                    other Accredited Investors or as fiduciary for the account
                    of one or more trusts, each of which is an "accredited
                    investor" within the meaning of Rule 501(a)(7) under the
                    Securities Act and for each of which the undersigned
                    exercises sole investment discretion or (B) the undersigned
                    is a "bank," within the meaning of Section 3(a)(2) of the
                    Securities Act, or a "savings and loan association" or other
                    institution described in Section 3(a)(5)(A) of the
                    Securities Act that is acquiring the Debentures as fiduciary
                    for the account of one or more institutions for which the
                    undersigned exercises sole investment discretion;

            (iii)   In the event that the undersigned purchases any Debentures,
                    the undersigned will acquire the Debentures having a minimum
                    principal amount of not less than $100,000 for its own
                    account or for any separate account for which the
                    undersigned is acting;

            (iv)    The undersigned has such knowledge and experience in
                    financial and business matters that the undersigned is
                    capable of evaluating the merits and risks of purchasing the
                    Debentures;

            (v)     The undersigned is not acquiring the Debentures with a view
                    to distribution thereof or with any present intention of
                    offering or selling the Debentures or the Common Stock
                    issuable upon conversion thereof, except as permitted below;
                    provided that the disposition of the undersigned's property
                    and property of any accounts for which the undersigned is
                    acting as fiduciary shall remain at all times within the
                    undersigned's control; and

            (vi)    The undersigned has received a copy of the Offering
                    Memorandum and acknowledges that the undersigned has access
                    to such financial and other information, and has been
                    afforded the opportunity to ask such questions of
                    representatives of the Company and receive answers thereto,
                    as the undersigned deems necessary in connection with its
                    decision to purchase the Debentures.

          The undersigned understands that the Debentures are being offered in a
transaction not involving any public offering within the United States within
the meaning of the Securities Act and that the Debentures and the shares of
Common Stock issuable upon conversion thereof (collectively, the "Securities")
have not been registered under the Securities Act or any applicable state
securities laws, and the undersigned agrees, on its

                                      117
<PAGE>

own behalf and on behalf of each account for which the undersigned acquires any
Securities, that if in the future the undersigned decides to resell or otherwise
transfer such Securities, such Securities may be resold or otherwise transferred
only (a) to the Company or any subsidiary thereof, (b) inside the United States
to a person who is a "qualified institutional buyer" (as defined in Rule 144A
under the Securities Act) in a transaction meeting the requirements of Rule
144A, (c) inside the United States to an Accredited Investor that, prior to such
transfer, furnishes to the trustee (or transfer agent, as the case may be) for
such Securities a signed letter containing certain representations and
agreements relating to the restrictions on transfer of such Securities (the form
of which letter can be obtained from such trustee, or transfer agent, as the
case may be), (d) pursuant to the exemption from registration provided by Rule
144 under the Securities Act (if applicable) or (e) pursuant to a registration
statement which has been declared effective under the Securities Act. The
undersigned agrees that any such transfer of Securities referred to in this
paragraph shall be in accordance with applicable securities laws of any state of
the United States or any other applicable jurisdiction and in accordance with
the legends set forth on the Securities. The undersigned further agrees to
provide any person purchasing any of the Securities from the undersigned a
notice advising such purchaser that resales of such securities are restricted as
stated herein (unless the sale of securities has been registered under the
Securities Act). The undersigned understands that the registrar and transfer
agent for the Securities will not be required to accept for registration of
transfer any Securities, except upon presentation of evidence satisfactory to
the Company that the foregoing restrictions on transfer have been complied with.
The undersigned further understands that any Securities will be in the form of
definitive physical certificates and that such certificates will bear a legend
(unless the sale of the Securities has been registered under the Securities Act)
reflecting the substance of this paragraph.

          The undersigned acknowledges that the Company, others and you will
rely upon the undersigned's confirmations, acknowledgments and agreements set
forth herein, and the undersigned agrees to notify you promptly in writing if
any of its representations or warranties herein ceases to be accurate and
complete.

          THE LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK.

_________________________________________
(Name of Purchaser)

By:______________________________________

                                      118
<PAGE>

Name:____________________________________

Title:___________________________________

Address:_________________________________

                                      119
<PAGE>

                          [FORM OF CONVERSION NOTICE]

                               CONVERSION NOTICE

TO:  VERTICALNET, INC.

     The undersigned registered owner of this Security hereby irrevocably
exercises the option to convert this Security, or the portion hereof (which is
$1,000 principal amount or an integral multiple thereof) below designated, into
shares of Common Stock in accordance with the terms of the Indenture referred to
in this Security, and directs that the shares issuable and deliverable upon such
conversion, together with any check in payment for fractional shares and any
Securities representing any unconverted principal amount hereof, be issued and
delivered to the registered holder hereof unless a different name has been
indicated below.  If shares or any portion of this Security not converted are to
be issued in the name of a person other than the undersigned, the undersigned
will pay all transfer taxes payable with respect thereto.  Any amount required
to be paid to the undersigned on account of interest (including Liquidated
Damages, if any) accompanies this Security.

Dated:_________________________          ____________________________________

                                         ____________________________________
                                              Signature(s)

Signature(s) must be guaranteed by an eligible
Guarantor Institution (banks, stock brokers,
savings and loan associations and credit unions)
with membership in an approved signature guarantee
medallion program pursuant to Securities and
Exchange Commission Rule 17Ad-15 if shares of
Common Stock are to be issued, or Securities to be
delivered, other than to and in the name of the
required holder.


____________________________________
Signature Guarantee

NOTICE:  The signature must correspond with the name as written upon the face of
the Security in every particular without alternation or enlargement or any
change whatever.

                                      120
<PAGE>

Fill in for registration of shares if to be
issued, and Securities if to be delivered, other
than to and in the name of the registered holder:


____________________________________
(Name)


____________________________________
(Street Address)


____________________________________
(City, State and Zip Code)

Please print name and address

     Principal amount to be converted (if less than all):

     $_______,000


     ________________________________________________________
     Social Security or Other Taxpayer Identification Number

                                      121
<PAGE>

[FORM OF OPTION TO ELECT REPAYMENT UPON A CHANGE OF CONTROL]


TO:  VERTICALNET, INC.

     The undersigned registered owner of this Security hereby acknowledges
receipt of a notice from VerticalNet, Inc. (the "Company") as to the occurrence
of a Change of Control with respect to the Company and requests and instructs
the Company to repay the entire principal amount of this Security, or the
portion thereof (which is $1,000 principal amount or an integral multiple
thereof) below designated, in accordance with the terms of the Indenture
referred to in this Security, together with accrued interest (including
Liquidated Damages, if any) to, but excluding, such date, to the registered
holder hereof, in cash or, at the Company's election upon a Change of Control
and subject to certain conditions contained in the Indenture, in Common Stock.

Dated:______________________
                                        ____________________________________
                                                     Signature(s)

                                        ____________________________________
                                                     Signature(s)

                                        ____________________________________
                                        Social Security or Other Taxpayer
                                         Identification Number

                                        ____________________________________
                                        Principal amount to be repaid
                                         (if less than all): $______,000

                                        NOTICE: The above signatures of the
                                        holder(s) hereof must correspond with
                                        the name as written upon the face of the
                                        Security in every particular without
                                        alternation or enlargement or any change
                                        whatever.

                                      122
<PAGE>

                                   EXHIBIT C
                                   ---------

          FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER

                              FROM GLOBAL SECURITY

                      TO SECURITY IN CERTIFICATED FORM OR

                  FROM CERTIFICATED FORM TO CERTIFICATED FORM

                   (Pursuant to Section 2.5 of the Indenture)

Bankers Trust Company
4 Albany Street
New York, NY  10006

Attention:  Corporate Trust Department,
            (VerticalNet, Inc. 5 1/4% Convertible Subordinated Securities due
            2004)

Dear Ladies and Gentlemen:

     Reference is hereby made to the Indenture, dated as of September __, 1999
(the "Indenture"), between VerticalNet, Inc., as issuer (the "Company") and
Bankers Trust Company, as trustee.  Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.

     This letter relates to U.S. $__________ principal amount of securities
which are evidenced by one or more Global Securities and held with the
Depositary through the Depository Trust Company (the "Securities") in the name
of ____________________ (the "Transferor").  The Transferor has requested a
transfer of such beneficial interest in the Securities to a Person who will take
delivery thereof in the form of an equal principal amount of Securities
evidenced by one or more Securities in certificated form, to be held with the
Depositary.

     In connection with such request and in respect of such Securities, the
Transferor hereby certifies that:

                                  [CHECK ONE]

[ ]  such transfer is being effected pursuant to and in accordance with Rule
     144A under the United States Securities Act of 1933, as amended (the
     "Securities Act"),
                                      123
<PAGE>

     and, accordingly, the Transferor hereby further certifies that the
     Securities are being transferred to a Person that the Transferor reasonably
     believes is purchasing the Securities for its own account, or for one or
     more accounts with respect to which such person exercises sole investment
     discretion, and such Person and each such account is a "qualified
     institutional buyer" within the meaning of Rule 144A in a transaction
     meeting the requirements of Rule 144A;

                                       or

[ ]  such transfer is being effected pursuant to and in accordance with Rule 144
     under the Securities Act;

                                       or

[ ]  such transfer is being effected pursuant to an effective registration
     statement under the Securities Act;

                                       or

[ ]  such transfer is being effected pursuant to an exemption from the
     registration requirements of the Securities Act other than Rule 144A or
     Rule 144, and the Transferor hereby further certifies that the Securities
     are being transferred in compliance with the transfer restrictions
     applicable to the Securities and in accordance with the requirements of the
     exemption claimed, which certification is supported by such legal opinions
     or other information provided by the Transferor or the transferee (a copy
     of which the Transferor has attached to this certification) in form
     reasonably acceptable to the Company, to the effect that such transfer is
     in compliance with the Securities Act;

and such Securities are being transferred in compliance with any applicable blue
sky securities laws of any state of the United States.

     Upon giving effect to this request (i) to exchange a beneficial interest in
Global Securities for a beneficial interest in Securities in certificated form
or (ii) to exchange a beneficial interest in Securities in certificated form for
a beneficial interest in Securities in certificated form, the resulting
beneficial interest shall be subject to the restrictions on transfer applicable
to Global Securities pursuant to the Indenture and the Securities Act.

                                      124
<PAGE>

     This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchaser, and you and
each of them is entitled to rely on the contents of this certificate.  Terms
used in this certificate and not otherwise defined in the Indenture have the
meanings set forth in Regulation S under the Securities Act.



                              ____________________________________
                              [Insert Name of Transferor]

                              By:_________________________________
                                 Name:
                                 Title:
Dated:  __________, ____

                                      125