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                       INTERNATIONAL FAST FOOD CORPORATION
                                    as Issuer


                                       AND


                               MARINE MIDLAND BANK
                                   as Trustee


                                  _____________
                  


                                    INDENTURE

                          Dated as of November 5, 1997

                                  _____________



                                   $27,536,000

                  Aggregate Stated Principal Amount at Maturity
           11% Convertible Senior Subordinated Discount Notes due 2007







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<PAGE>
                                TABLE OF CONTENTS
                                -----------------
<TABLE>
<CAPTION>

<S>                                                                              <C>
ARTICLE 1
     DEFINITIONS AND RULES OF CONSTRUCTION........................................1
     SECTION 1.01.     DEFINITIONS................................................1
     SECTION 1.02.     OTHER DEFINITIONS.........................................16
     SECTION 1.03.     RULES OF CONSTRUCTION.....................................16

ARTICLE 2
     THE SECURITIES..............................................................17
     SECTION 2.01.     FORM AND DATING...........................................17
     SECTION 2.02.     EXECUTION AND AUTHENTICATION..............................17
     SECTION 2.03.     REGISTRAR AND PAYING AGENT................................18
     SECTION 2.04.     PAYING AGENT TO HOLD ASSETS IN TRUST......................18
     SECTION 2.05.     HOLDER LISTS..............................................19
     SECTION 2.06.     TRANSFER AND EXCHANGE.....................................19
     SECTION 2.07.     REPLACEMENT SECURITIES....................................20
     SECTION 2.08.     OUTSTANDING SECURITIES....................................20
     SECTION 2.09.     TREASURY SECURITIES.......................................20
     SECTION 2.10.     TEMPORARY SECURITIES......................................21
     SECTION 2.11.     CANCELLATION..............................................21
     SECTION 2.12.     CUSIP NUMBER..............................................21
     SECTION 2.13.     DEPOSIT OF MONEYS.........................................21
     SECTION 2.14.     RECORD DATE...............................................22

ARTICLE 3
     PURCHASE....................................................................22
     SECTION 3.01.     OFFER TO REPURCHASE.......................................22
     SECTION 3.02.     DEPOSIT OF PURCHASE PRICE.................................24
     SECTION 3.03.     DELIVERY OF SECURITIES AND PAYMENT OF
                       PURCHASE PRICE............................................24
     SECTION 3.04.     SECURITIES PURCHASED IN PART..............................24

ARTICLE 4
     REDEMPTION..................................................................25
     SECTION 4.02.     NOTICES TO TRUSTEE........................................25
     SECTION 4.03.     SELECTION OF SECURITIES TO BE REDEEMED....................25
     SECTION 4.04.     NOTICE OF REDEMPTION......................................26
     SECTION 4.05.     EFFECT OF NOTICE OF REDEMPTION. ..........................27
     SECTION 4.06.     DEPOSIT OF REDEMPTION PRICE...............................28
     SECTION 4.07.     PAYMENT OF SECURITIES CALLED FOR REDEMPTION...............28
     SECTION 4.08.     SECURITIES REDEEMED IN PART.  ............................28



                                         i


<PAGE>




ARTICLE 5
     COVENANTS...................................................................28
     SECTION 5.01.     PAYMENT OF SECURITIES.....................................28
     SECTION 5.02.     MAINTENANCE OF OFFICE OR AGENCY...........................29
     SECTION 5.03.     REPORTS AND OTHER COMMUNICATIONS..........................29
     SECTION 5.04.     COMPLIANCE CERTIFICATES...................................30
     SECTION 5.05.     TAXES.....................................................31
     SECTION 5.06.     WAIVER OF STAY, EXTENSION AND USURY LAWS..................31
     SECTION 5.07      RESTRICTED PAYMENTS.......................................31
     SECTION 5.08.     DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING
                       RESTRICTED SUBSIDIARIES...................................33
     SECTION 5.09      INCURRENCE OF INDEBTEDNESS  ..............................34
     SECTION 5.10.     ASSET SALES...............................................35
     SECTION 5.11.     TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES.............36
     SECTION 5.12.     LIENS.....................................................37
     SECTION 5.13.     CONDUCT OF BUSINESS.......................................37
     SECTION 5.14      CORPORATE EXISTENCE.......................................38
     SECTION 5.15.     OFFER TO REPURCHASE UPON CHANGE OF CONTROL................38
     SECTION 5.16.     STATUS AS INVESTMENT COMPANY..............................38
     SECTION 5.17.     DESIGNATION OF RESTRICTED SUBSIDIARY AS UNRESTRICTED
                       SUBSIDIARY; REDESIGNATION OF UNRESTRICTED SUBSIDIARY AS
                       RESTRICTED SUBSIDIARY ....................................39
     SECTION 5.18.     INTERNAL REVENUE SERVICE FILING AND
                       WITHHOLDING INFORMATION...................................39
     SECTION 5.19.     ISSUANCE AND SALE OF CAPITAL STOCK
                       OF RESTRICTED SUBSIDIARIES................................39
     SECTION 5.20.     ISSUANCES OF GUARANTEES
                       BY RESTRICTED SUBSIDIARIES................................40
     SECTION 5.21.     INCURRENCE OF SENIOR SUBORDINATED
                       INDEBTEDNESS. ............................................40
     SECTION 5.22      ACCOUNTANTS...............................................40
     SECTION 5.23      INSURANCE.................................................41

ARTICLE 6
     SUCCESSORS..................................................................41
     SECTION 6.01.     MERGER, CONSOLIDATION, OR SALE OF ASSETS..................41
     SECTION 6.02.     SUCCESSOR CORPORATION SUBSTITUTED.........................42




                                        ii


<PAGE>



ARTICLE 7
     DEFAULTS AND REMEDIES.......................................................42
     SECTION 7.01.     EVENTS OF DEFAULT.........................................42
     SECTION 7.02.     ACCELERATION..............................................44
     SECTION 7.03.     OTHER REMEDIES............................................45
     SECTION 7.04.     WAIVER OF PAST DEFAULTS...................................45
     SECTION 7.05.     CONTROL BY MAJORITY.......................................45
     SECTION 7.06.     LIMITATION ON SUITS.......................................46
     SECTION 7.07.     RIGHTS OF HOLDERS OF SECURITIES TO
                       RECEIVE PAYMENT...........................................46
     SECTION 7.08.     COLLECTION SUIT BY TRUSTEE................................46
     SECTION 7.09.     TRUSTEE MAY FILE PROOFS OF CLAIM..........................47
     SECTION 7.10.     PRIORITIES................................................47
     SECTION 7.11.     UNDERTAKING FOR COSTS.....................................48

ARTICLE 8
     TRUSTEE.....................................................................48
     SECTION 8.01.     DUTIES OF TRUSTEE.........................................48
     SECTION 8.02.     RIGHTS OF TRUSTEE AND EACH AGENT..........................50
     SECTION 8.03.     INDIVIDUAL RIGHTS OF TRUSTEE..............................51
     SECTION 8.04.     DISCLAIMER OF TRUSTEE AND AGENTS..........................51
     SECTION 8.05.     NOTICE OF DEFAULT.........................................51
     SECTION 8.06.     REPORTS BY TRUSTEE TO HOLDERS.............................52
     SECTION 8.07.     COMPENSATION AND INDEMNITY................................52
     SECTION 8.08.     REPLACEMENT OF TRUSTEE....................................53
     SECTION 8.09.     SUCCESSOR TRUSTEE BY MERGER, ETC..........................54
     SECTION 8.10.     ELIGIBILITY; DISQUALIFICATION.............................54
     SECTION 8.11.     PREFERENTIAL COLLECTION OF
                       CLAIMS AGAINST THE COMPANY................................54
     SECTION 8.12.     AUTHENTICATING AGENTS.....................................55

ARTICLE 9
     AMENDMENT, SUPPLEMENT AND WAIVER............................................56
     SECTION 9.01.     WITHOUT CONSENT OF HOLDERS................................56
     SECTION 9.02.     WITH CONSENT OF HOLDERS...................................56
     SECTION 9.03.     REVOCATION AND EFFECT OF CONSENTS.........................57
     SECTION 9.04.     NOTATION ON OR EXCHANGE OF SECURITIES.....................58
     SECTION 9.05.     TRUSTEE TO SIGN AMENDMENTS, ETC...........................58




                                        iii


<PAGE>



ARTICLE 10
     SUBORDINATION...............................................................59
     SECTION 10.01.    SECURITIES SUBORDINATE TO SENIOR INDEBTEDNESS.  ..........59
     SECTION 10.02.    NO PAYMENT ON SECURITIES IN CERTAIN
                       CIRCUMSTANCES.............................................59
     SECTION 10.03.    PAYMENT OVER OF PROCEEDS UPON
                       DISSOLUTION, ETC.  .......................................60
     SECTION 10.04.    SUBROGATION OF HOLDERS TO RIGHTS OF HOLDERS OF
                       SENIOR INDEBTEDNESS. .....................................61
     SECTION 10.05.    OBLIGATIONS OF COMPANY UNCONDITIONAL.  ...................62
     SECTION 10.06.    PAYMENTS MAY BE MADE PRIOR TO DISSOLUTION. ...............62
     SECTION 10.07.    NO WAIVER OF SUBORDINATION PROVISIONS.  ..................62
     SECTION 10.08.    AUTHORIZATION TO TRUSTEE TO TAKE ACTION TO
                       EFFECTUATE SUBORDINATION.  ...............................63
     SECTION 10.09.    SENIOR INDEBTEDNESS MAY BE RENEWED OR
                       EXTENDED, ETC.  ..........................................63
     SECTION 10.10.    TRUSTEE TO HAVE NO FIDUCIARY DUTY TO HOLDERS OF
                       SENIOR INDEBTEDNESS.......................................63
     SECTION 10.11.    RIGHTS OF TRUSTEE AS HOLDER OF SENIOR
                       INDEBTEDNESS.  ...........................................63
     SECTION 10.12.    NOTICE TO TRUSTEE.  ......................................64
     SECTION 10.13.    RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF
                       LIQUIDATING AGENT.  ......................................64
     SECTION 10.14.    NOT TO PREVENT EVENTS OF DEFAULT.  .......................65
     SECTION 10.15.    TRUSTEE'S COMPENSATION NOT PREJUDICED.  ..................65

ARTICLE 11
     CONVERSION OF SECURITIES ...................................................65
     SECTION 11.01.    RIGHT TO CONVERT; MANDATORY CONVERSION. ..................65
     SECTION 11.02.    MECHANICS OF CONVERSION.  ................................66
     SECTION 11.03.    ADJUSTMENT TO CONVERSION RATIO.  .........................68
     SECTION 11.04.    NO FRACTIONAL SHARES.  ...................................74
     SECTION 11.05.    RECLASSIFICATION, CONSOLIDATION, MERGER OR
                       SALE OF ASSETS.  .........................................74
     SECTION 11.06.    SPECIFIC PERFORMANCE.  ...................................74
     SECTION 11.07     COMPANY TO RESERVE COMMON STOCK. .........................75
     SECTION 11.08     RESPONSIBILITY OF TRUSTEE FOR CONVERSION
                       PROVISIONS................................................75




                                        iv


<PAGE>



ARTICLE 12
     MISCELLANEOUS...............................................................75
     SECTION 12.01.    NOTICES...................................................75
     SECTION 12.02.    CERTIFICATE AND OPINION AS TO CONDITIONS
                       PRECEDENT.................................................77
     SECTION 12.03.    STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.............77
     SECTION 12.04.    RULES BY TRUSTEE AND AGENTS...............................78
     SECTION 12.05.    NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS,
                       EMPLOYEES AND STOCKHOLDERS................................78
     SECTION 12.06.    GOVERNING LAW.............................................78
     SECTION 12.07.    NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.............79
     SECTION 12.08.    SUCCESSORS................................................79
     SECTION 12.09.    SEVERABILITY..............................................79
     SECTION 12.10.    COUNTERPART ORIGINALS.....................................79
     SECTION 12.11.    TABLE OF CONTENTS, HEADINGS, ETC..........................79

     EXHIBITS AND SCHEDULES

     EXHIBIT A     -   FORM OF SECURITY
     EXHIBIT B     -   ASSIGNMENT FORM
     EXHIBIT C     -   TRANSFEREE CERTIFICATE FOR NON-QIB ACCREDITED
                       INVESTORS

     SCHEDULE I   -    EXISTING INDEBTEDNESS
     SCHEDULE II  -    EXISTING LIENS
     SCHEDULE III -    FORM OF CEO CERTIFICATION

</TABLE>


                                         v


<PAGE>



      INDENTURE dated as of November 5, 1997,  between  International  Fast Food
Corporation,  a Florida corporation (the "Company"), and Marine Midland Bank, as
trustee (the "Trustee").

                             RECITALS OF THE COMPANY

      The  Company  has duly  authorized  the  execution  and  delivery  of this
Indenture to provide for the issuance of $27,536,000  aggregate stated principal
amount at maturity of the Company's 11% Convertible Senior Subordinated Discount
Notes due 2007 (the  "Securities")  issuable as provided in this Indenture.  All
things  necessary to make the  Securities,  when duly issued and executed by the
Company, and authenticated and delivered hereunder, the valid obligations of the
Company,  and to make  this  Indenture  a valid  and  binding  agreement  of the
Company, have been done.

      The Company and the Trustee agree as follows for the benefit of each other
and for the equal and ratable benefit of the Holders of the Securities:


                                    ARTICLE 1
                      DEFINITIONS AND RULES OF CONSTRUCTION

SECTION 1.01.    DEFINITIONS.

      "Accreted  Value" is defined to mean,  for any Specified  Date, the amount
provided for each $1,000 principal amount at maturity of Securities:

      (i) if the  Specified  Date occurs on one of the  following  dates (each a
"Semi-Annual  Accrual Date"), the Accreted Value will equal the amount set forth
below for such Semi-Annual Accrual Date:


      Semi-Annual Accrual Date                       Accreted Value
      ------------------------                       --------------

      April 30, 1998 . . . . . . . . . . . . . . . . $   765.13 
      October 31, 1998 . . . . . . . . . . . . . . .     807.22
      April 30, 1999 . . . . . . . . . . . . . . . .     851.61
      October 31, 1999 . . . . . . . . . . . . . . .     898.45
      April 30, 2000 . . . . . . . . . . . . . . . .     947.87
      October 31, 2000 . . . . . . . . . . . . . . .   1,000.00

      (ii) if the  Specified  Date occurs before the first  Semi-Annual  Accrual
Date,  the Accreted Value will equal the sum of (a) the original issue price and
(b) an  amount  equal to the  product  of (1) the  Accreted  Value for the first




                                      1


<PAGE>


Semi-Annual  Accrual  Date less the  original  issue price  MULTIPLIED  by (2) a
fraction,  the  numerator  of which is the number of days from the Issue Date of
the  Securities  to the  Specified  Date,  using a 360-day year of twelve 30-day
months,  and the  denominator  of which is the number of days  elapsed  from the
Issue Date of the  Securities to the first  Semi-Annual  Accrual  Date,  using a
360-day year of twelve 30-day months;

      (iii)if the Specified Date occurs between two  Semi-Annual  Accrual Dates,
the  Accreted  Value  will  equal  the sum of (a)  the  Accreted  Value  for the
Semi-Annual  Accrual Date  immediately  preceding such Specified Date and (b) an
amount  equal to the  product  of (1) the  Accreted  Value  for the  immediately
following  Semi-Annual  Accrual Date less the Accreted Value for the immediately
preceding  Semi-Annual Accrual Date MULTIPLIED by (2) a fraction,  the numerator
of which  is the  number  of days  from the  immediately  preceding  Semi-Annual
Accrual  Date to the  Specified  Date,  using a 360-day  year of  twelve  30-day
months, and the denominator of which is 180; or

      (iv) if the Specified Date occurs after the last Semi-Annual Accrual Date,
the Accreted Value will equal $1,000.

      "Adjusted  Consolidated Net Income" means,  for any period,  the aggregate
net income (or loss) of the Company  and its  Restricted  Subsidiaries  for such
period  determined in conformity  with GAAP;  PROVIDED that the following  items
shall be  excluded  in  computing  Adjusted  Consolidated  Net  Income  (without
duplication):  (i)  the  net  income  of  any  Person  (other  than  net  income
attributable  to a Restricted  Subsidiary)  in which any Person  (other than the
Company or any of its Restricted  Subsidiaries) has a joint interest and the net
income of any  Unrestricted  Subsidiary,  except to the  extent of the amount of
dividends  or other  distributions  actually  paid to the  Company or any of its
Restricted  Subsidiaries  by such other Person during such period;  (ii) the net
income of any Restricted  Subsidiary to the extent (and only to the extent) that
the  declaration  or  payment of  dividends  or  similar  distributions  by such
Restricted  Subsidiary  of such net income is not at the time  permitted  by the
operation of the terms of its charter or any  agreement,  instrument,  judgment,
decree,  order,  statute,  rule or  governmental  regulation  applicable to such
Restricted  Subsidiary;  (iii)  any  gains or  losses  (on an  after-tax  basis)
attributable to Asset Sales;  (iv) except for purposes of calculating the amount
of  Restricted  Payments  that may be made  pursuant  to clause (C) of the first
paragraph of Section 5.07, any amount paid as, or accrued for, cash dividends on
Preferred  Stock of the Company or any  Restricted  Subsidiary  owned by Persons
other  than the  Company  and any of its  Restricted  Subsidiaries;  and (v) all
extraordinary gains and extraordinary losses or expenses.

      "Adjusted  Consolidated  Net  Tangible  Assets"  means the total amount of
assets  of  the  Company  and  its  Restricted   Subsidiaries  (less  applicable
depreciation,  amortization  and other valuation  reserves) except to the extent
resulting from write-ups of capital assets  (excluding  write- ups in connection
with  accounting for  acquisitions  in conformity  with GAAP),  after  deducting
therefrom  (i)  all  current  liabilities  of the  Company  and  its  Restricted
Subsidiaries (excluding intercompany items) and (ii) all goodwill,  trade names,
trademarks,  patents,  unamortized  debt  discount  and  expense  and other like




                                      2


<PAGE>


intangibles  (other than rights under the New BKC Development  Agreement and the
New Domino's  Master  Franchise  Agreement) all as set forth on the quarterly or
annual   consolidated   balance   sheet  of  the  Company  and  its   Restricted
Subsidiaries,  prepared in conformity with GAAP and most recently filed with the
Commission  pursuant to Section 5.03. As used in this  Indenture,  references to
financial  statements of the Company and its  Restricted  Subsidiaries  shall be
adjusted to exclude Unrestricted Subsidiaries if the context requires.

      "Affiliate"  means, as applied to any Person, any other Person directly or
indirectly  controlling,  controlled  by,  or under  direct or  indirect  common
control  with,  such  Person.   For  purposes  of  this  definition,   "control"
(including,  without correlative meanings, the terms "controlling,"  "controlled
by" and "under  common  control  with"),  as applied  to any  Person,  means the
possession,  directly  or  indirectly,  of the  power to  direct  or  cause  the
direction of the  management  and policies of such Person,  whether  through the
ownership of voting securities, by contract or otherwise.

      "Agent"  means  any  Registrar,  Paying  Agent,  Authenticating  Agent  or
co-Registrar.

      "Asset Sale" means any sale,  transfer or other disposition  (including by
way of merger,  consolidation or sale leaseback transactions) in one transaction
or a series of related  transactions  by the  Company  or any of its  Restricted
Subsidiaries  to any  Person  other than the  Company  or any of its  Restricted
Subsidiaries  of  (i)  all  or  any of  the  Capital  Stock  of  any  Restricted
Subsidiary,  (ii) all or  substantially  all of the  property  and  assets of an
operating unit or business of the Company or any of its Restricted  Subsidiaries
or (iii) any other  property or assets of the  Company or any of its  Restricted
Subsidiaries  outside  the  ordinary  course of  business of the Company or such
Restricted  Subsidiary  and, in each case, that is not governed by Sections 5.10
and 6.01;  PROVIDED that the following  shall not be included within the meaning
of "Asset Sale": (A) sales or other  dispositions of inventory,  receivables and
other current assets;  and (B) sales or other dispositions of equipment that has
become worn out, obsolete or damaged or otherwise  unsuitable or unnecessary for
use  in  connection   with  the  business  of  the  Company  or  its  Restricted
Subsidiaries,

      "Authenticating  Agent"  means any Person  authorized  pursuant to Section
8.12 to act on behalf of the Trustee to authenticate Securities.

      "Average  Life" means,  at any date of  determination  with respect to any
debt security,  the quotient obtained by dividing (i) the sum of the products of
(a) the  number of years  from such date of  determination  to the dates of each
successive  scheduled principal payment of such debt security and (b) the amount
of such principal payment by (ii) the sum of all such principal payments.

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




                                      3


<PAGE>



      "Board  of  Directors"  means  the Board of  Directors  or any  authorized
committee  of the Board of  Directors.  Unless  otherwise  indicated,  "Board of
Directors" shall mean the Board of Directors of the Company.

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

      "Business Day" means any day other than a Legal Holiday.

      "Capital  Stock"  means,  with respect to any Person,  any and all shares,
interests,  participations or other  equivalents  (however  designated,  whether
voting or  non-voting)  in equity of such  Person,  whether now  outstanding  or
issued after the date of this  Indenture,  including,  without  limitation,  all
Common Stock and Preferred Stock.

      "Capitalized  Lease"  means,  as applied to any  Person,  any lease of any
property (whether real, personal or mixed) of which the discounted present value
of the rental  obligations of such Person as lessee, in conformity with GAAP, is
required to be capitalized on the balance sheet of such Person; and "Capitalized
Lease  Obligations" means the discounted present value of the rental obligations
under such lease.

      "Change of  Control"  means such time as any of (i) a "person"  or "group"
(within the meaning of Sections 13(d) and 14(d)(2) of the Exchange  Act),  other
than the Permitted Investor, becomes the ultimate "beneficial owner" (as defined
in Rules 13d-3 and 13d-5 under the Exchange  Act,  except that a Person shall be
deemed to have beneficial ownership of all shares that such Person has the right
to acquire,  whether  such right is  exercisable  immediately  or only after the
passage of time) of Voting Stock  representing more than 50% of the total voting
power of the Voting  Stock of the  Company  (on an  undiluted  basis),  (ii) the
Permitted  Investor shall beneficially own (as defined in clause (i) immediately
above)  Voting Stock  representing  less than 40.0% of the total voting power of
the Voting Stock of the Company owned by the  Permitted  Investor as of the date
hereof,  or (iii) Mr.  Mitchell  Rubinson  shall  cease (a) to be the  principal
executive officer of the Company in charge of the management and policies of the
Company  or (b) to devote  substantially  the same  level of  business  time and
efforts to the business  affairs of the Company and its Restricted  Subsidiaries
as are devoted by him thereto as of the date hereof.

      "Closing  Date"  means the date on which the  Securities  were  originally
issued under this Indenture.

      "Closing Price" shall have the meaning set forth in Section 11.03.

      "Commission" means the Securities and Exchange Commission.

      "Company"   means   International   Fast  Food   Corporation,   a  Florida
corporation.



                                      4


<PAGE>



      "Common  Stock" means the common stock,  par value $.01 per share,  of the
Company.

      "Consolidated  EBITDA"  means,  for any  period,  net cash from  operating
activities  as  determined  on a  consolidated  basis  for the  Company  and its
Restricted  Subsidiaries in conformity with GAAP; PROVIDED,  HOWEVER,  that when
used with respect to any Restricted Subsidiary, "Consolidated EBITDA" shall mean
the Consolidated EBITDA of such Restricted  Subsidiary  calculated in the manner
set forth  above,  and  "Adjusted  Consolidated  Net Income"  and  "Consolidated
Interest Expense" shall be calculated with respect to such Restricted Subsidiary
on a consolidated basis.

      "Consolidated  Interest  Expense"  means,  for any period,  the  aggregate
amount of  interest  in  respect  of  Indebtedness  (including  amortization  of
original  issue  discount on any  Indebtedness  and the interest  portion of any
deferred  payment  obligation,  calculated  in  accordance  with  the  effective
interest  method of accounting;  all  commissions,  discounts and other fees and
charges  owed  with  respect  to  letters  of  credit  and  bankers'  acceptance
financing;  the  net  costs  associated  with  Interest  Rate  Agreements;   and
Indebtedness  that  is  Guaranteed  or  secured  by  the  Company  or any of its
Restricted  Subsidiaries)  and all but the  principal  component  of  rentals in
respect of Capitalized  Leased Obligations paid, accrued or scheduled to be paid
or to be accrued by the  Company  and its  Restricted  Subsidiaries  during such
period.

      "Consolidated   Net   Worth"   means,   at  any  date  of   determination,
stockholders'  equity  as set  forth on the most  recently  available  unaudited
quarterly or audited  annual  consolidated  balance sheet of the Company and its
Restricted Subsidiaries required hereunder (which shall be as of a date not more
than 90 days  prior to the date of such  computation,  and which  shall not take
into  account  Unrestricted  Subsidiaries),  less any  amounts  attributable  to
Redeemable  Stock or any equity security  convertible  into or exchangeable  for
indebtedness,  the  cost of  treasury  stock  and the  principal  amount  of any
promissory notes receivable from the sale of the Capital Stock of the Company or
any of its  Restricted  Subsidiaries,  each item to be  determined in conformity
with GAAP.

      "Conversion  Shares"  means the shares of Common Stock  issuable  upon the
conversion of the Securities.

      "Corporate  Trust  Office of the  Trustee"  shall be at the address of the
Trustee  specified in Section 12.01 hereof or such other address as to which the
Trustee may give notice to the Company.

      "Currency  Agreement" means any foreign exchange  contract,  currency swap
agreement  or other  similar  agreement or  arrangement  designed to protect the
Company or any of its Restricted  Subsidiaries  against fluctuations in currency
values to or under which the Company or any of its Restricted  Subsidiaries is a
party or a  beneficiary  on the date of this  Indenture  or  becomes  a party or
beneficiary thereafter.




                                      5


<PAGE>



      "Default"  means any event that is, or after  notice or passage of time or
both would be, an Event of Default.

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

      "Existing  Indebtedness"  means any  Indebtedness of the Company or any of
its  Restricted  Subsidiaries  outstanding  or  available  on the  date  of this
Indenture as set forth on Schedule I hereto.

      "fair market value" means the price that would be paid in an  arm's-length
transaction  between an informed and willing  seller under no compulsion to sell
and an informed and willing  buyer under no  compulsion to buy, as determined in
good faith by the Board of Directors (whose  determinations shall be conclusive)
and evidenced by a Board Resolution.

      "GAAP" means generally accepted accounting principles in the United States
of America as in effect on the date of determination thereof, including, without
limitations,  those  set  forth  in  the  opinions  and  pronouncements  of  the
Accounting  Principles  Board of the  American  Institute  of  Certified  Public
Accountants  and  statements  and  pronouncements  of the  Financial  Accounting
Standards Board or in such other  statements by such other entity as approved by
a significant segment of the accounting profession.  All ratios and computations
contained in this Indenture shall be computed in conformity with GAAP applied on
a consistent basis.

      "Guarantee" means any obligation,  contingent or otherwise,  of any Person
directly or indirectly  guaranteeing any Indebtedness or other obligation of any
other  Person  and,  without  limiting  the  generality  of the  foregoing,  any
obligation,  direct or indirect,  contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation of such other Person (whether arising by virtue
of partnership arrangements,  or by agreements to keep well, to purchase assets,
goods,  securities  or  services,  to  take-or-pay,  or  to  maintain  financial
statement conditions or otherwise) or (ii) entered into for purposes of assuring
in any other manner the obligee of such  Indebtedness or other obligation of the
payment  thereof or to protect such obligee  against loss in respect thereof (in
whole or in  part);  PROVIDED  that  the  term  "Guarantee"  shall  not  include
endorsements  for collection or deposit in the ordinary course of business.  The
term "Guarantee" used as a verb has a corresponding meaning.

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

      "IFFP" shall have the meaning set forth in Section 5.07.

      "Incur" means, with respect to any Indebtedness,  to incur, create, issue,
assume,  Guarantee or otherwise  become liable for or with respect to, or become
responsible for, the payment of,  contingently or otherwise,  such Indebtedness,
including,  with  respect to the Company  and its  Restricted  Subsidiaries,  an




                                      6


<PAGE>


"incurrence"  of  Indebtedness  by  reason  of a Person  becoming  a  Restricted
Subsidiary of the Company; PROVIDED that neither the accrual of interest nor the
accretion of original  issue  discount  shall be  considered  an  Incurrence  of
Indebtedness.

      "Indebtedness"   means,  with  respect  to  any  Person  at  any  date  of
determination  (without  duplication,  and whether or not  contingent),  (i) all
indebtedness  of such Person for borrowed  money;  (ii) all  obligations of such
Person  evidenced  by  bonds,  debentures,  notes or other  similar  instruments
(whether negotiable or non-negotiable),  (iii) all obligations of such Person in
respect  of  letters  of  credit  or  other   similar   instruments   (including
reimbursement  obligations with respect  thereto),  (iv) all obligations of such
Person to pay the  deferred and unpaid  purchase  price of property or services,
except  current trade payables  incurred in the ordinary  course of business and
payable in  accordance  with  customary  practices,  (v) all  Capitalized  Lease
Obligations  of such  Person,  (vi) all  liabilities  secured by any Lien on any
property  owned by such Person even if such Person has not assumed or  otherwise
become liable for the payment  thereof to the extent of the fair market value of
the property  subject to such Liens,  (vii) all  Indebtedness  of other  Persons
Guaranteed by such Person to the extent such  Indebtedness is Guaranteed by such
Person  and  (viii) to the extent not  otherwise  included  in this  definition,
obligations under Currency  Agreements and Interest Rate Agreements.  The amount
of Indebtedness  of any Person at any date shall be the  outstanding  balance at
such date of all unconditional  obligations as described above and, with respect
to contingent obligations that are included in any of clauses (i) through (viii)
above, the maximum liability upon the occurrence of the contingency  giving rise
to the obligation,  PROVIDED (A) that the amount  outstanding at any time of any
Indebtedness  issued  with  original  issue  discount is the face amount of such
Indebtedness  and (B) that  Indebtedness  shall not  include any  liability  for
federal,  state,  local or other  taxes  except to the  extent  evidenced  by an
instrument.

      "Indenture" means this Indenture,  as amended or supplemented from time to
time.

      "Interest  Payment Date" means each  semi-annual  interest payment date on
April 30 and October 31 of each year, commencing April 30, 2001.

      "Interest Rate Agreement"  means any interest rate  protection  agreement,
interest rate future agreement,  interest rate option  agreement,  interest rate
swap  agreement,  interest rate cap agreement,  interest rate collar  agreement,
interest rate hedge agreement or other similar agreement or arrangement designed
to  protect  the  Company  or  any  of  its  Restricted   Subsidiaries   against
fluctuations  in interest rates in respect of Indebtedness to or under which the
Company or any of its Restricted Subsidiaries is a party or a beneficiary on the
date of this Indenture or becomes a party or a beneficiary hereafter.

      "Investment" in any Person means any direct or indirect  advance,  loan or
other extension of credit (including, without limitation, by way of Guarantee or
similar arrangement;  but excluding advances to customers in the ordinary course
of business that are, in conformity with GAAP,  recorded as accounts  receivable
on the balance sheet of the Company or its Restricted  Subsidiaries)  or capital




                                      7


<PAGE>


contribution to (by means of any transfer of cash or other property to others or
any payment for property or services  for the account or use of others),  or any
purchase or  acquisition  of Capital Stock,  bonds,  notes,  debentures or other
similar instruments issued by, such Person and shall include (i) the designation
of a  Restricted  Subsidiary  as an  Unrestricted  Subsidiary  and (ii) the fair
market  value  of the  Capital  Stock  held by the  Company  and the  Restricted
Subsidiaries  of any Person  that has ceased to be a  Restricted  Subsidiary  by
reason  of any  transaction  permitted  by clause  (iii) of  Section  5.19.  For
purposes of the definition of  "Unrestricted  Subsidiary"  and Section 5.07, (i)
"Investment"  shall  include  the  fair  market  value  of the  assets  (net  of
liabilities)  of any Restricted  Subsidiary of the Company at the time that such
Restricted  Subsidiary of the Company is designated an  Unrestricted  Subsidiary
and shall  exclude the fair market value of the assets (net of  liabilities)  of
any  Unrestricted  Subsidiary at the time that such  Unrestricted  Subsidiary is
designated  a  Restricted  Subsidiary  of the  Company  and  (ii)  any  property
transferred to or from an  Unrestricted  Subsidiary  shall be valued at its fair
market value at the time of such  transfer,  in each case as  determined  by the
Board of Directors in good faith.

      "Issue Date" means the Closing Date for the sale and original  issuance of
the Securities under this Indenture.

      "Legal  Holiday"  means a  Saturday,  a Sunday  or a day on which  banking
institutions  in the City of New York or at a place of payment are authorized by
law,  regulation  or executive  order to remain  closed.  If a payment date is a
Legal  Holiday at a place of  payment,  payment may be made at that place on the
next  succeeding day that is not a Legal  Holiday,  and no interest shall accrue
for the intervening period.

      "Lien" means any mortgage, pledge, security interest, encumbrance, lien or
charge of any kind (including, without limitation, any conditional sale or other
title retention agreement or lease in the nature thereof, any sale with recourse
against the seller or any Affiliate of the seller,  or any agreement to give any
security interest).

      "Maturity Date" means October 31, 2007.

      "Net  Cash  Proceeds"  means,  (a) with  respect  to any Asset  Sale,  the
proceeds of such Asset Sale in the form of cash or cash  equivalents,  including
payments in respect of deferred payment obligations (to the extent corresponding
to the principal, but not interest, component thereof) when received in the form
of cash or cash  equivalents  and proceeds from the conversion of other property
received when converted to cash or cash  equivalents,  net of (i) reasonable and
customary brokerage  commissions and other fees and expenses (including fees and
expenses of counsel and  investment  bankers)  related to such Asset Sale,  (ii)
provisions  for all taxes that will  actually be paid or are payable as a result
of such Asset Sale, without regard to the consolidated  results of operations of
the Company and its Restricted  Subsidiaries,  taken as a whole,  (iii) payments
made to repay  Indebtedness or any other  obligation  outstanding at the time of
such Asset Sale that  either (A) is secured by a Lien on the  property or assets
sold or (B) is required to be paid as a result of such sale and (iv) appropriate




                                      8


<PAGE>


amounts to be  provided  by the  Company  or any  Restricted  Subsidiary  of the
Company as a cash reserve  against any  liabilities  associated  with such Asset
Sale, including,  without limitation,  pension and other post-employment benefit
liabilities,  liabilities related to environmental matters and liabilities under
any  indemnification  obligations  associated  with  such  Asset  Sale,  all  as
determined in conformity  with GAAP and (b) with respect to any issuance or sale
of Capital  Stock,  the proceeds of such issuance or sale in the form of cash or
cash equivalents,  including payments in respect of deferred payment obligations
(to the extent  corresponding  to the  principal,  but not  interest,  component
thereof) when received in the form of cash or cash equivalents and proceeds from
the  conversion  of  other  property  received  when  converted  to cash or cash
equivalents, net of reasonable and customary attorney's fees, accountants' fees,
underwriters' or placement agents' fees, discounts or commissions and brokerage,
consultant and other fees incurred in connection  with such issuance or sale and
net of taxes paid or payable as a result thereof.

      "New  BKC  Development   Agreement"   means  the  Restaurant   Development
Agreement,  dated as of March 14,  1997,  by and  between the Company and Burger
King Corporation.

      "New  Domino's  Master  Franchise  Agreement"  means the Master  Franchise
Agreement, dated as of August 28, 1997, by and between Krolewska Pizza Sp.z.o.o.
and Domino's Pizza International, Inc.

      "Offer to Purchase"  means an offer to purchase  Securities by the Company
from the Holders that is required by Sections 5.10 or 5.15 of this Indenture.

      "Officer"  means,  with respect to any Person,  the Chairman of the Board,
the Chief Executive Officer,  the President,  the Chief Operating  Officer,  the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller,
the Secretary, any Assistant Secretary, any Vice President or any Assistant Vice
President of such Person.

      "Officers'  Certificate"  means a  certificate  signed  on  behalf  of the
Company by two Officers of the Company,  one of whom must be the Chief Executive
Officer,  the  President,  the Chief  Operating  Officer or the Chief  Financial
Officer of the Company that meets the requirements of Section 12.02 hereof.

      "Opinion of Counsel" means an opinion from legal counsel who is reasonably
acceptable to the Trustee,  that meets the requirements of Section 12.02 hereof.
The counsel may be an employee of or counsel to the Company or the Trustee.

      "OTC Price" shall have the meaning set forth in Section 11.01(b).

      "Other  Indebtedness"  means  Indebtedness  of the  Company  or any of its
Restricted  Subsidiaries  other  than (a) the  Securities  and (b) any  Existing
Indebtedness.




                                      9


<PAGE>



      "Paying  Agent" has the meaning  provided in Section  2.03,  except  that,
during the  continuance of a Default or Event of Default and for the purposes of
Article 3 and Sections 5.10 and 5.15,  the Paying Agent shall not be the Company
or any Affiliate of the Company.

      "Payment  Date" means the date of purchase,  which shall be a Business Day
no earlier  than 30 days nor later than 60 days from the date a notice is mailed
pursuant to an Offer to Purchase.

      "Permitted  Investment" means (i) an Investment in a Restricted Subsidiary
or a Person which will, upon the making of such Investment,  become a Restricted
Subsidiary or be merged or  consolidated  with or into or transfer or convey all
or substantially all its assets to, the Company or a Restricted Subsidiary; (ii)
Temporary Cash Investments;  (iii) payroll, travel and similar advances to cover
matters that are expected at the time of such advances  ultimately to be treated
as expenses in accordance  with GAAP;  (iv) loans or advances to employees in an
aggregate  principal amount not to exceed $250,000 at any one time  outstanding;
(v) stock, obligations or securities received in satisfaction of judgments; (vi)
Investments, to the extent that the consideration provided by the Company or any
of its  Restricted  Subsidiaries  consists  solely of Capital  Stock (other than
Redeemable  Stock) of the Company  issued at fair market value;  and (vii) notes
payable  to the  Company  that are  received  by the  Company  as payment of the
purchase price for Capital Stock (other than Redeemable Stock) of the Company.

      "Permitted Investor" means Mr. Mitchell Rubinson, his spouse and any trust
for the benefit of the foregoing.

      "Permitted  Liens"  means (i) Liens for taxes,  assessments,  governmental
charges or claims that are being  contested in good faith by  appropriate  legal
proceedings promptly instituted and diligently conducted and for which a reserve
or other appropriate provision,  if any, as shall be required in conformity with
GAAP shall have been made;  (ii)  statutory or common law Liens of landlords and
carriers, warehousemen,  mechanics, suppliers,  materialmen,  repairmen or other
similar  Liens  arising in the  ordinary  course of business and with respect to
amounts not yet delinquent or being contested in good faith by appropriate legal
proceedings promptly instituted and diligently conducted and for which a reserve
or other appropriate provision,  if any, as shall be required in conformity with
GAAP shall have been made; (iii) Liens incurred or deposits made in the ordinary
course of  business  in  connection  with  workers'  compensation,  unemployment
insurance and other types of social  security;  (iv) Liens  incurred or deposits
made to secure the performance of tenders, bids, leases, statutory or regulatory
obligations,   bankers'  acceptances,   surety  and  appeal  bonds,   government
contracts,  performance  and  return-of-money  bonds and other  obligations of a
similar  nature  incurred  in the  ordinary  course of  business  (exclusive  of
obligations for the payment of borrowed money) and a bank's unexercised right of
set-off with respect to deposits made in the ordinary  course;  (v) assessments,
rights-of-way,   municipal   and  zoning   ordinances   and   similar   charges,
encumbrances,  title  defects  or other  irregularities  that do not  materially
interfere  with the  ordinary  course of  business  of the Company or any of its
Restricted  Subsidiaries;  (vi) existing  liens set forth on Schedule II to this
Indenture,  (vii)  Liens  securing  Indebtedness  that  has been  refinanced  or




                                      10


<PAGE>


refunded as permitted under clause (iii) of the second paragraph of Section 5.09
to the extent that such refinanced or refunded Indebtedness was secured,  (viii)
Liens on assets existing at the time of acquisition by the Company provided that
such Liens were not incurred in  contemplation of such  acquisition,  (ix) Liens
(including  extensions  and  renewals  thereof)  upon real or personal  property
acquired  after the Closing Date;  provided that (a) such Lien is created solely
for the purpose of securing  Indebtedness  Incurred in  accordance  with Section
5.09,   (1)  to  finance  the  cost   (including  the  cost  of  improvement  or
construction) of the item of property or assets subject thereto and such Lien is
created  prior to, at the time of or within twelve months after the later of the
acquisition,  the  completion  of  construction  or  the  commencement  of  full
operation of such  property or (2) to refinance any  Indebtedness  previously so
secured,  (b) the principal amount of the Indebtedness secured by such Lien does
not exceed  100% of such cost and (c) any such Lien shall not extend to or cover
any  property  or assets  other  than such item of  property  or assets  and any
improvements on or associated with such item; (x) leases or subleases granted to
others that do not materially  interfere with the ordinary course of business of
the Company and its Restricted Subsidiaries, taken as a whole; (xi) any interest
or  title  of a lessor  in the  property  subject  to any  Capitalized  Lease or
operating  lease;  (xii) Liens arising from filing Uniform  Commercial  Code (or
similar law in effect in Poland) financing statements  regarding leases;  (xiii)
Liens on property of, or on shares of stock or Indebtedness  of, any corporation
existing  at the time  such  corporation  becomes,  or  becomes  a part of,  any
Restricted  Subsidiary;  PROVIDED  that such Liens do not extend to or cover any
property or assets of the Company or any  Restricted  Subsidiary  other than the
property  or  assets  acquired;  (xiv)  Liens  in favor  of the  Company  or any
Restricted Subsidiary; (xv) Liens arising from the rendering of a final judgment
or order  against the Company or any  Restricted  Subsidiary of the Company that
does not give rise to an Event of Default;  (xvi) Liens  securing  reimbursement
obligations with respect to letters of credit that encumber  documents and other
property  relating  to such  letters of credit  and the  products  and  proceeds
thereof;  (xvii) Liens in favor of customs and revenue  authorities arising as a
matter  of law to secure  payment  of  customs  duties  in  connection  with the
importation of goods;  (xviii) Liens encumbering  customary initial deposits and
margin deposits,  and other Liens that are either within the general  parameters
customary in the industry  and incurred in the ordinary  course of business,  in
each case,  security  Indebtedness  under Interest Rate  Agreements and Currency
Agreements and forward contracts,  options, future contracts, futures options or
similar agreements or arrangements designed to protect the Company or any of its
Restricted  Subsidiaries  from  fluctuations in the price of commodities;  (xix)
Liens arising out of conditional  sale, title retention,  consignment or similar
arrangements  for the sale of goods  entered  into by the  Company or any of its
Restricted  Subsidiaries  in the ordinary  course of business in accordance with
the past practices of the Company and its Restricted  Subsidiaries  prior to the
Closing Date; (xx) Liens securing Indebtedness permitted under clause (i) of the
second paragraph under Section 5.09; and (xxi) Liens on or sales of receivables.

      "Person" means an  individual,  corporation,  partnership,  joint venture,
association,    limited   liability   company,   joint-stock   company,   trust,
unincorporated  organization  or government  or agency or political  subdivision
thereof  (including any  subdivision  or ongoing  business of any such entity or
substantially all of the assets of any such entity, subdivision or business).



                                      11


<PAGE>



      "Preferred Stock" means,  with respect to any Person,  any and all shares,
interests,  participations or other  equivalents  (however  designated,  whether
voting or non-voting) of such Person's  preferred or preference  stock,  whether
now outstanding or issued after the date of this Indenture,  including,  without
limitation, all series and classes of such preferred or preference stock.

      "Redeemable  Stock"  means any class or  series  of  Capital  Stock of any
Person that by its terms or otherwise  is (i)  required to be redeemed  prior to
the Stated  Maturity of the  Securities,  (ii)  redeemable  at the option of the
holder of such class or series of Capital  Stock at any time prior to the Stated
Maturity of the  Securities  (unless the  redemption  price is, at the Company's
option, without conditions precedent, payable solely in Common Stock (other than
Redeemable  Stock) of the Company) or (iii) convertible into or exchangeable for
Capital Stock referred to in clause (i) or (ii) above or  Indebtedness  having a
scheduled maturity prior to the Stated Maturity of the Securities.

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

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

      "Registrar" has the meaning provided in Section 2.03.

      "Registration Rights Agreement" means the Registration Rights Agreement by
and between the Company,  the purchasers of the  Securities  and BT Alex.  Brown
Incorporated,  relating to the Securities and dated as of the Issue Date, as the
same may be amended,  supplemented  or modified  from time to time in accordance
with the terms thereof.

      "Restricted  Subsidiary" means any Subsidiary of the Company other than an
Unrestricted Subsidiary.

      "Securities"  means any of the  Securities,  as  defined  in the  preamble
hereof, that are authenticated and delivered under this Indenture.

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

      "Security Register" has the meaning provided in Section 2.03.

      "Senior  Indebtedness" means with respect to the Company, the principal of
and interest  on, and all other  amounts  owing in respect of, any  Indebtedness
permitted  to be  incurred  by the  Company  under the  terms of this  Indenture
(including,  but not limited to, reasonable fees and expenses of counsel and all
other  reasonable  charges,  fees and expenses  incurred in connection with such
Indebtedness), unless the instrument creating or evidencing such Indebtedness or



                                      12


<PAGE>



pursuant to which such Indebtedness is outstanding  expressly provides that such
Indebtedness  is on a parity  with or  subordinated  in right of  payment to the
Securities. Notwithstanding the foregoing, Senior Debt shall not include (i) any
Indebtedness  for federal,  state,  local or other taxes,  (ii) any Indebtedness
among or  between  the  Company  and/or  any  Restricted  Subsidiary,  (iii) any
Indebtedness  incurred for the purchase of goods or  materials,  or for services
obtained, in the ordinary course of business or any Guarantees in respect of any
such  Indebtedness,  (iv) any Indebtedness that is incurred in violation of this
Indenture, (v) Indebtedness evidenced by the Securities, or (vi) Indebtedness of
a Person  that is  expressly  subordinated  or junior in right of payment to any
other  Indebtedness  of such  Person.  Senior  Indebtedness  will  also  include
interest  accruing  subsequent  to events of  bankruptcy  of the Company and its
Subsidiaries  at the rate  provided  for in the document  governing  such Senior
Indebtedness,  whether  or not such  interest  is an allowed  claim  enforceable
against the debtor in a bankruptcy case under the Bankruptcy Law.

      "Senior  Subordinated  Obligations"  is defined to mean any  principal of,
premium,  if any, or interest on the Securities payable pursuant to the terms of
the Securities or upon  acceleration,  to the extent relating to the purchase of
Securities  or amounts  corresponding  to such  principal,  premium,  if any, or
interest on the Securities.

      "Shelf Registration Statement" means the registration statement as defined
and described in the Registration Rights Agreement.

      "Significant  Subsidiary"  means,  at  any  date  of  determination,   any
Restricted  Subsidiary of the Company that, together with its Subsidiaries,  (i)
for the most recent  fiscal year of the Company,  accounted for more than 10% of
the consolidated revenues of the Company and its Restricted Subsidiaries or (ii)
as to the  end of such  fiscal  year,  was the  owner  of more  than  10% of the
Adjusted  Consolidated  Net  Tangible  Assets of the Company and its  Restricted
Subsidiaries,  all as set  forth on the  most  recently  available  consolidated
financial statements of the Company for such fiscal year.

      "Specified  Date" means any redemption  date, any date of purchase for any
purchase of Securities pursuant to Sections 5.10 or 5.15, any date of conversion
or  exchange  of  Securities  or any date on which  the  Securities  are due and
payable after an Event of Default.

      "Stated  Maturity" means, (i) with respect to any debt security,  the date
specified in such debt security as the fixed date on which the final installment
of principal  of such debt  security is due and payable and (ii) with respect to
any scheduled installment of principal of or interest on any debt security,  the
date specified in such debt security as the fixed date on which such installment
is due and payable.

      "Subsidiary"   means,  with  respect  to  any  Person,   any  corporation,
association or other  business  entity of which Voting Stock  representing  more




                                      13


<PAGE>


than 50% of the voting power of the outstanding Voting Stock is owned,  directly
or indirectly, by such Person and one or more other Subsidiaries of such Person.

      "Temporary  Cash  Investment"  means  any of  the  following:  (i)  direct
obligations of the United States or any agency thereof or obligations  fully and
unconditionally guaranteed by the United States or any agency thereof; (ii) time
deposit  accounts,  certificates of deposits and money market deposits  maturing
within  90 days of the date of  acquisition  thereof  issued  by a bank or trust
company  which is  organized  under  the laws of the  United  States,  any state
thereof or territory or any foreign country that is a member of the Organization
of Economic  Cooperation  and  Development  and which bank or trust  company has
capital, surplus and undivided profits aggregating in excess of $100 million (or
the foreign  currency  thereof) and has outstanding  debt which is rated "A" (or
such similar equivalent rating) or higher by Moody's Investors Service,  Inc. or
Standard  and Poor's  Ratings  Group or any  money-market  fund  sponsored  by a
registered   broker  dealer  or  mutual  fund   distributor,   (iii)  repurchase
obligations  with a term of not more than 30 days for  underlying  securities of
the types  described  in clause (i) above  entered  into with a bank meeting the
qualifications  described in clause (ii) above; (iv) commercial paper,  maturing
not more than 90 days  after the date of  acquisition,  issued by a  corporation
(other than an Affiliate of the Company)  organized  and in existence  under the
laws of the United States,  any state thereof or any foreign country  recognized
by the  United  States  with a rating  at the time as of  which  any  investment
therein is made of "P-1" (or higher)  according  to Moody's  Investors  Service,
Inc. or "A-1" (or higher)  according to Standard & Poor's Ratings Group; and (v)
securities  with  maturities of six months or less from the date of  acquisition
issued or fully and  unconditionally  guaranteed by any state,  commonwealth  or
territory  of the  United  States,  or by any  political  subdivision  or taxing
authority thereof,  and rated at least "A" by Standard & Poor's Ratings Group or
Moody's Investors Service, Inc.

      "TIA" means the Trust  Indenture  Act of 1939,  as amended  (15 U.S.  Code
ss.ss. 77aaa - 77bbbb), as in effect on the date this Indenture was executed.

      "Trading  Day"  means a day on which  the  principal  national  securities
exchange  on which the  Common  Stock of the  Company is listed or  admitted  to
trading is open for the transaction of business,  or, if the Common Stock of the
Company  is not  listed  or  admitted  to  trading  on any  national  securities
exchange,  a day on which the NASDAQ National or Small Cap Market System (or any
successor  thereto) or such other system then in use is open for the transaction
of  business,  or, if the Common  Stock of the Company is not quoted by any such
organization,  any day other than a Saturday,  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.

      "Transaction   Date"  means,   with  respect  to  the  Incurrence  of  any
Indebtedness (including, without limitation, Senior Indebtedness) by the Company
or any of its  Restricted  Subsidiaries,  the date  such  Indebtedness  is to be
incurred and, with respect to any Restricted  Payment,  the date such Restricted
Payment is to be made.




                                      14


<PAGE>



      "Trustee"  means the party named as such above until a successor  replaces
it in accordance with the applicable provisions of this Indenture and thereafter
means the successor serving hereunder.

      "Trust  Officer"  means any  officer or  assistant  officer of the Trustee
assigned by the Trustee to  administer  its  corporate  trust matters or, in the
case of a successor trustee, an officer assigned to the department,  division or
group performing the corporate trust work of such successor.

      "Unrestricted  Subsidiary" means (i) any Subsidiary of the Company that at
the time of determination shall be designated an Unrestricted  Subsidiary by the
Board of Directors in the manner  provided  below and (ii) any  Subsidiary of an
Unrestricted  Subsidiary.  The Board of Directors may  designate any  Restricted
Subsidiary  of the  Company  (including  any  newly  acquired  or  newly  formed
Subsidiary of the Company), other than a Subsidiary that has become a guarantor,
to be an Unrestricted  Subsidiary  unless such Subsidiary owns any Capital Stock
of, or owns or holds any Lien on any property of, the Company or any  Restricted
Subsidiary;  PROVIDED that neither the Company nor its  Restricted  Subsidiaries
has any Guarantee of any Indebtedness of such Subsidiary outstanding at the time
of such  designation and either (A) the Subsidiary to be so designated has total
assets of $1,000  or less or (B) if such  Subsidiary  has  assets  greater  than
$1,000,  that such designation  would be permitted under Section 5.07. The Board
of  Directors  may  designate  any  Unrestricted  Subsidiary  to be a Restricted
Subsidiary of the Company; PROVIDED that immediately after giving effect to such
designation (x) the Company could incur $1.00 of additional  Indebtedness  under
the first paragraph of Section 5.09 and (y) no Default or Event of Default shall
have occurred and be continuing.  Any such designation by the Board of Directors
shall be evidenced to the Trustee by promptly  filing with the Trustee a copy of
the  Board  Resolution  giving  effect  to  such  designation  and an  Officers'
Certificate  certifying  that  such  designation  complied  with  the  foregoing
provisions.

      "U.S. Government Obligations" means direct obligations of, and obligations
guaranteed  by, the United  States of America  for the payment of which the full
faith and credit of the United States of America is pledged.

      "U.S.  legal  tender"  means 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.

      "Voting  Stock"  means with  respect to any Person,  Capital  Stock of any
class or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person.

      "Wholly Owned" means,  with respect to any Subsidiary of any Person,  such
Subsidiary if all of the  outstanding  Capital Stock in such  Subsidiary  (other
than any  director's  qualifying  shares or  Investments  by  foreign  nationals
mandated by applicable  law) is owned by such Person or one or more Wholly Owned
Subsidiaries of such Person.



                                      15


<PAGE>



SECTION 1.02.    OTHER DEFINITIONS.

                 Term                          Defined In Section
                 ----                          ------------------

           "BBS"                                     11.01
           "Conversion Ratio"                        11.01
           "Current Market Price"                    11.03
           "Distribution Securities"                 11.03
           "Expiration Time"                         11.03
           "Event of Default"                        6.07
           "Excess Proceeds"                         5.10
           "Guaranteed Indebtedness"                 5.20
           "Market Criteria"                         11.01
           "Market Criteria Period"                  11.01
           "Payment Blockage Period"                 10.02
           "Protected Property"                      5.12
           "Purchased Shares"                        11.03
           "Record Date"                             11.03
           "Restricted Subsidiary Indebtedness"      5.09
           "Subsidiary Guarantee"                    5.20

SECTION 1.03.    RULES OF CONSTRUCTION.

      Unless the context otherwise requires:

      (1)  a term has the meaning assigned to it;

      (2) an accounting term not otherwise  defined has the meaning  assigned to
it in accordance with GAAP;

      (3)  "OR" is not exclusive;

      (4) words in the singular  include the plural,  and in the plural  include
the singular;

      (5) provisions apply to successive events and transactions;

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

      (7)  references to sections of or rules under the  Securities Act shall be
deemed to include substitute, replacement or successor sections or rules adopted
by the SEC from time to time.






                                      16


<PAGE>



                                   ARTICLE 2
                                THE SECURITIES


SECTION 2.01.    FORM AND DATING.

      The Securities and the notation  relating to the Trustee's  certificate of
authentication  shall be  substantially in the form of Exhibit A. The Securities
may have notations, legends or endorsements required by law, stock exchange rule
or usage.  The Company and the Trustee shall approve the form of the  Securities
and any notation,  legend or endorsement  on them.  Each Security shall be dated
the date of its issuance and shall show the date of its authentication.

      The terms and provisions  contained in the  Securities,  annexed hereto as
Exhibit  A, shall  constitute,  and are 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 2.02.    EXECUTION AND AUTHENTICATION.

      Two Officers, or an Officer and an Assistant Secretary, shall sign, or one
Officer  shall sign and one  Officer  or an  Assistant  Secretary  (each of whom
shall,  in each  case,  have been duly  authorized  by all  requisite  corporate
actions)  shall attest to, the Securities for the Company by manual or facsimile
signature. The Company's seal shall also be reproduced on the Securities and may
be in facsimile form.

      If an Officer or Assistant  Secretary whose signature is on a Security was
an Officer or Assistant  Secretary at the time of such  execution  but no longer
holds  that  office  or  position  at the time  the  Trustee  authenticates  the
Security, the Security shall nevertheless be valid.

      A Security shall not be valid until an authorized signatory of the Trustee
manually signs the certificate of authentication on the Security.  The signature
shall be conclusive evidence that the Security has been authenticated under this
Indenture.

      The  Trustee  shall  authenticate  Securities  for  original  issue in the
aggregate  stated  principal amount at maturity of $27,536,000 upon receipt of a
written order of the Company in the form of an Officers' Certificate (which need
not comply with  Sections  12.02 and 12.03).  The  Officers'  Certificate  shall
specify  the amount of  Securities  to be  authenticated,  the date on which the
Securities are to be authenticated and such other information as the Trustee may
reasonably  request.  The  aggregate  stated  principal  amount at  maturity  of
Securities  outstanding  at any  time  may not  exceed  $27,536,000,  except  as
provided in Section 2.07.  Upon receipt of a written  order of the Company,  the
Trustee shall authenticate  Securities in substitution of Securities  originally
issued to reflect any name change of the Company.




                                      17


<PAGE>



      The  Trustee  may  appoint  an  authenticating  agent (an  "Authenticating
Agent")  reasonably  acceptable to the Company to  authenticate  the Securities.
Unless  otherwise  provided  in the  appointment,  an  Authenticating  Agent may
authenticate  Securities  whenever the Trustee may do so. Each reference in this
Indenture  to  authentication  by the Trustee  includes  authentication  by such
agent. An Authenticating  Agent has the same rights as an Agent to deal with the
Company and Affiliates of the Company. The Trustee hereby appoints Bankers Trust
Company to be the Authenticating Agent on the Issue Date.

      The Securities  shall be issuable in fully  registered form only,  without
coupons, in denominations of $1,000 and any integral multiple thereof.

SECTION 2.03.    REGISTRAR AND PAYING AGENT.

      The Company shall  maintain an office or agency (which shall be located in
the Borough of Manhattan in the City of New York, State of New York),  where (a)
Securities may be presented or surrendered  for  registration of transfer or for
exchange  ("Registrar"),  (b)  Securities  may be presented or  surrendered  for
payment  ("Paying  Agent") and (c) notices and demands to or upon the Company in
respect of the Securities and this Indenture may be served.  The Registrar shall
keep a register  of the  Securities  and of their  transfer  and  exchange  (the
"Security  Register").  The Company, upon notice to the Trustee, may have one or
more   co-Registrars  and  one  or  more  additional  paying  agents  reasonably
acceptable  to the Trustee.  The term  "Paying  Agent"  includes any  additional
paying agent. The Company upon notice to the Trustee may change any Registrar or
Paying Agent without  notice to any Holder.  The Company may act as Registrar or
Paying Agent,  except that for purposes of Article 3 and Sections 5.10 and 5.15,
the Paying Agent shall not be the Company or any Affiliate of the Company.

      The Company  shall enter into an  appropriate  agency  agreement  with any
Agent  not a party  to this  Indenture,  which  agreement  shall  implement  the
provisions of this Indenture that relate to such Agent. The Company shall notify
the  Trustee,  in advance,  of the name and  address of any such  Agent.  If the
Company fails to maintain a Registrar or Paying Agent,  the Trustee shall act as
such.

      The Company  initially  appoints Bankers Trust Company at 4 Albany Street,
New York, New York 10006,  as Registrar and Paying Agent until such time as such
Agent has resigned or a successor has been appointed.

SECTION 2.04.    PAYING AGENT TO HOLD ASSETS IN TRUST.

      The Company  shall  require  each  Paying  Agent other than the Trustee to
agree in writing  that each Paying  Agent shall hold in trust for the benefit of
the Holders or the  Trustee all assets held by the Paying  Agent for the payment
of principal of, or premium, if any, and interest on, the Securities,  and shall
notify the Trustee of any Default by the Company in making any such payment. The
Company, upon written direction to  the Paying Agent,  at any time may require a



                                      18


<PAGE>



Paying Agent to distribute  all assets held by it to the Trustee and account for
any assets  disbursed and the Trustee may at any time during the  continuance of
any payment Default, upon written request to a Paying Agent, require such Paying
Agent to distribute  all assets held by it to the Trustee and to account for any
assets  distributed.  Upon  distribution to the Trustee of all assets that shall
have been delivered by the Company to the Paying Agent and the completion of any
accounting required to be made hereunder, the Paying Agent shall have no further
liability for such assets.

SECTION 2.05.    HOLDER LISTS.

      The  Trustee  shall  preserve  in as  current  a  form  as  is  reasonably
practicable  the most recent list  available to it of the names and addresses of
all Holders.  If the Trustee is not the Registrar,  the Company shall furnish to
the Trustee at such times as the  Trustee  may  request in  writing,  and in any
event in intervals of not more than six months  commencing  on the Issue Date, a
list in such form and as of such date as the Trustee may  reasonably  require of
the names and addresses of the Holders, including the aggregate principal amount
of the Securities held by each thereof,  which list may be  conclusively  relied
upon by the Trustee.

SECTION 2.06.    TRANSFER AND EXCHANGE.

      When  Securities are presented to the Registrar or a  co-Registrar  with a
request  to  register  the  transfer  of such  Securities  or to  exchange  such
Securities  for an equal  principal  amount of  Securities  of other  authorized
denominations, the Registrar or co-Registrar shall register the transfer or make
the exchange as  requested if its  requirements  for such  transaction  are met;
PROVIDED,  HOWEVER,  that the  Securities  surrendered  for transfer or exchange
shall be duly endorsed or accompanied by a written instrument of transfer in the
form of Exhibit B hereto,  duly  executed by the Holder  thereof or his attorney
duly  authorized in writing and be  accompanied  by a certificate in the form of
Exhibit C hereto  completed by the proposed  transferee.  In connection with any
transfers of Securities,  each Holder agrees by its acceptance of the Securities
to furnish the Registrar and the Company such certifications,  legal opinions or
other  information  as the  Registrar or the Company may  reasonably  request 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;
PROVIDED, that the Registrar shall not be required to determine (but may rely on
a  determination  made by the Company with respect to) the  sufficiency  of such
certifications,  legal opinions or other information.  To permit registration of
transfers  and  exchanges,  the Company  shall  execute  and the  Trustee  shall
authenticate  Securities at the Registrar's or co- Registrar's  written request.
No service  charge shall be made for any  registration  of transfer or exchange,
but the Company may require  payment of a sum  sufficient  to cover any transfer
tax or similar  governmental charge payable in connection  therewith (other than
any such transfer taxes or other  governmental  charge payable upon exchanges or
transfers  pursuant  to Section  2.02,  2.10,  3.04,  5.10,  5.15 or 9.04).  The
Registrar or  co-Registrar  shall not be required to register the transfer of or
exchange  of any  Security  during  an Offer to  Purchase  if such  Security  is
tendered pursuant to such Offer to Purchase and not withdrawn.




                                      19


<PAGE>



 SECTION 2.07.   REPLACEMENT SECURITIES.

      If a mutilated  Security is surrendered to the Trustee or if the Holder of
a Security  claims that the  Security  has been lost,  destroyed  or  wrongfully
taken, the Company shall issue and the Trustee shall  authenticate a replacement
Security if the  Trustee's  requirements  are met.  Such Holder must  provide an
indemnity bond or other indemnity sufficient, in the judgment of the Company and
the  Trustee,  to protect  the  Company,  the Trustee or any Agent from any loss
which any of them may suffer if a Security is  replaced.  The Company may charge
such Holder for its reasonable  out-of-pocket  expenses in replacing a Security,
including  reasonable fees and expenses of counsel.  Every replacement  Security
shall constitute an additional obligation of the Company.

SECTION 2.08.    OUTSTANDING SECURITIES.

      Securities  outstanding at any time are all the Securities  that have been
authenticated  by the  Trustee  except  those  canceled  by the  Trustee,  those
delivered  to it for  cancellation  and those  described  in this Section as not
outstanding.  Subject  to  Section  2.09,  a  Security  does  not  cease  to  be
outstanding because the Company or any of its Affiliates holds the Security.

      If a Security is replaced pursuant to Section 2.07 (other than a mutilated
Security  surrendered for replacement),  it ceases to be outstanding  unless the
Trustee receives proof  satisfactory to it that the replaced Security is held by
a BONA FIDE  purchaser.  A  mutilated  Security  ceases to be  outstanding  upon
surrender of such Security and replacement thereof pursuant to Section 2.07.

      If the principal  amount of any Security is considered  paid under Section
5.01, it ceases to be outstanding and interest ceases to accrue.

      If on the  Maturity  Date the  Paying  Agent  holds  money in  immediately
available  funds and  designated  for and sufficient to pay all of the principal
of, and premium, if any, and interest due on the Securities payable on that date
and is not prohibited from paying such money to the Holders thereof  pursuant to
the terms of this Indenture,  then on and after that date such Securities  cease
to be outstanding and interest on them ceases to accrue.

SECTION 2.09.    TREASURY SECURITIES.

      In  determining  whether the Holders of the required  principal  amount of
Securities  have  concurred  in  any  direction,   waiver,  consent  or  notice,
Securities  owned  by the  Company  or an  Affiliate  of the  Company  shall  be
considered as though they are not  outstanding,  except that for the purposes of
determining  whether the Trustee shall be protected in relying on any direction,
waiver or consent, only Securities which the Trustee actually knows are so owned
shall be so considered.  The Company shall notify the Trustee, in writing,  when
it or any of its Affiliates  repurchases or otherwise acquires Securities and of
the aggregate  principal  amount of such  Securities so repurchased or otherwise





                                      20


<PAGE>


acquired.  The Trustee may require an Officers'  Certificate  listing Securities
owned by the  Company,  a  Subsidiary  of the  Company or any  Affiliate  of the
Company.

SECTION 2.10.    TEMPORARY SECURITIES.

      Until  definitive  Securities  are ready for  delivery,  the  Company  may
prepare and the Trustee shall authenticate  temporary Securities upon receipt of
a written  order of the  Company in the form of an  Officers'  Certificate.  The
Officers'  Certificate  shall  specify the amount of temporary  Securities to be
authenticated  and  the  date  on  which  the  temporary  Securities  are  to be
authenticated.  Temporary  Securities  shall  be  substantially  in the  form of
definitive  Securities  but may  have  variations  that  the  Company  considers
appropriate for temporary  Securities.  Without  unreasonable delay, the Company
shall prepare and execute,  and the Trustee shall authenticate upon receipt of a
written  order  of the  Company  in the  form  of an  Officers'  Certificate  in
accordance  with Section 2.02,  definitive  Securities in exchange for temporary
Securities.

SECTION 2.11.    CANCELLATION.

      The  Company  at any  time  may  deliver  Securities  to the  Trustee  for
cancellation.  The  Registrar  and the Paying Agent shall forward to the Trustee
any  Securities  surrendered  to them for  transfer,  exchange or  payment.  The
Trustee or, at the direction of the Trustee,  the Registrar or the Paying Agent,
and no one else,  shall  cancel and, at the written  direction  of the  Company,
shall dispose of (subject to the record  retention  requirements of the Exchange
Act) (but shall not be required  to  destroy)  all  Securities  surrendered  for
transfer,  exchange,  payment or  cancellation.  Subject to  Section  2.07,  the
Company may not issue new Securities to replace  Securities that the Company has
paid or delivered to the Trustee for cancellation.  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  surrendered  to the  Trustee  for  cancellation  pursuant  to this
Section 2.11.

SECTION 2.12.    CUSIP NUMBER.

      The  Company  in  issuing  the  Securities  may  use a  "CUSIP"  or  other
identification  number,  and if so,  the  Trustee  shall  use the CUSIP or other
identification number in notices of redemption or other notices as a convenience
to Holders;  PROVIDED that any such notice may state that no  representation  is
made as to the correctness or accuracy of the CUSIP number printed in the notice
or on the  Securities,  and  that  reliance  may be  placed  only  on the  other
identification numbers printed on the Securities.

SECTION 2.13.    DEPOSIT OF MONEYS.

      Prior to 11:00 a.m. New York City time on the Business Day  preceding  the
Maturity  Date,  the Company shall deposit with the Paying Agent in  immediately





                                      21


<PAGE>


available  funds money  sufficient  to make cash  payments,  if any,  due on the
Maturity  Date,  in a timely  manner  which  permits  the Paying  Agent to remit
payment to the Holders on the Maturity Date.

SECTION 2.14.    RECORD DATE.

      The record date for purposes of determining the identity of Holders of the
Securities  entitled  to vote  or  consent  to any  action  by  vote or  consent
authorized or permitted under this Indenture shall be determined as provided for
in Section 9.03.

                                    ARTICLE 3
                                    PURCHASE

SECTION 3.01.    OFFER TO REPURCHASE.

      In the event that,  pursuant to Sections 5.10 or 5.15 hereof,  the Company
shall be  required  to  commence  an  Offer to  Purchase,  it shall  follow  the
procedures specified below.

      The  Company  shall send,  by first class mail,  a notice of such Offer to
Purchase  to the  Trustee  and  each of the  Holders  which  shall  contain  all
instructions and materials necessary to enable such Holders to tender Securities
pursuant to such Offer to Purchase. The notice of Offer to Purchase, which shall
govern the terms of the Offer to Purchase, shall state:

            (a) that the  Offer to  Purchase  is  being  made  pursuant  to this
      Section 3.01 and Section 5.10 or 5.15 hereof, as applicable, the length of
      time that such Offer to Purchase shall remain open and that all Securities
      validly tendered will be accepted for payment on a pro rata basis;

            (b)  the purchase price and the Payment Date;

            (c) that any Security  not  tendered or accepted  for payment  shall
      continue to accrue interest pursuant to its terms;

            (d) that,  unless the Company  defaults  in payment of the  purchase
      price, any Security  accepted for payment pursuant to an Offer to Purchase
      shall cease to accrue interest on or after the Payment Date;

            (e) that Holders electing to have a Security  purchased  pursuant to
      any Offer to Purchase shall be required to surrender the Security together
      with the form  entitled  "Option of the Holder to Elect  Purchase"  on the
      reverse side of the Security completed, to the Paying Agent at the address
      specified in the notice prior to the close of business on the Business Day
      immediately preceding the Payment Date;





                                      22


<PAGE>



            (f) that Holders shall be entitled to withdraw their election if the
      Paying Agent receives, not later than the close of business on the date of
      the  Offer to  Purchase,  a  telegram,  facsimile  transmission  or letter
      setting forth the name of the Holder,  the principal  amount of Securities
      the Holder  delivered  for  purchase  and a statement  that such Holder is
      withdrawing his election to have such Securities purchased;

            (g) that Holders whose  Securities are being  purchased only in part
      shall  be  issued  new  Securities   equal  in  principal  amount  to  the
      unpurchased  portion  of the  Securities  surrendered,  which  unpurchased
      portion  must be  equal to  $1,000  in  principal  amount  or an  integral
      multiple thereof; and

            (h) that no representation is made as to the correctness or accuracy
      of the CUSIP  number,  if any,  listed in such  notice or  printed  on the
      Securities.

      Without limiting the foregoing,  the notice shall also contain information
concerning the business of the Company and its Restricted Subsidiaries which the
Company in good faith  believes  will  enable  such  Holders to make an informed
decision  with respect to the Offer to Purchase  which at a minimum will include
(i) the most recent annual and quarterly financial  statements and "Management's
Discussion  and  Analysis of  Financial  Condition  and  Results of  Operations"
contained in the  documents  required to be supplied to the Trustee  pursuant to
Section 5.03 (which  requirements may be satisfied by delivery of such documents
together with the notice),  (ii) a description of material  developments  in the
Company's  business  subsequent  to the  date of the  latest  of such  financial
statements  referred to in clause (i)  (including  a  description  of the events
requiring  the  Company  to make the Offer to  Purchase),  (iii) if  applicable,
appropriate pro forma financial information concerning the Offer to Purchase and
the events  requiring  the  Company to make the Offer to  Purchase  and (iv) any
other information required by applicable law to be included therein.

      At the  Company's  request,  the Trustee shall give the notice of Offer to
Purchase in the Company's name and at its expense;  PROVIDED,  HOWEVER, that the
Company shall have delivered to the Trustee, at least 30 days prior to the Offer
to Purchase,  an  Officers'  Certificate  requesting  that the Trustee give such
notice and setting forth the information to be stated in such notice as provided
in the preceding paragraph.

      The  Trustee  shall act as  Paying  Agent  for an Offer to  Purchase.  The
Company shall comply with the  requirements of Rule 14e-1 under the Exchange Act
and any other securities laws and regulations thereunder to the extent such laws
and  regulations  are applicable in connection with the repurchase of Securities
in connection  with an Offer to Purchase.  To the extent that the  provisions of
any  securities  laws  and  regulations  conflict  with the  Offer  to  Purchase
provisions  of this  Indenture,  the Company  shall  comply with the  applicable
securities  laws and  regulations  and shall not be deemed to have  breached its
obligations under this Indenture by virtue thereof.



                                      23


<PAGE>




SECTION 3.02.    DEPOSIT OF PURCHASE PRICE.

      On or prior to the Payment Date,  the Company shall (i) accept for payment
on a pro rata basis Securities or portions thereof tendered pursuant to an Offer
to Purchase;  (ii) deposit  with the Paying  Agent money  sufficient  to pay the
purchase  price of all  Securities  or portions  thereof so accepted;  and (iii)
deliver,  or cause to be  delivered,  to the Trustee all  Securities or portions
thereof  accepted  together  with  any  Officers'  Certificate   specifying  the
Securities  or portions  thereof so accepted  for  payment by the  Company.  The
Paying Agent shall promptly  return to the Company any money  deposited with the
Paying  Agent by the  Company  in excess  of the  amounts  necessary  to pay the
purchase price of all Securities purchased.

      If the Company complies with the provisions of the preceding paragraph, on
and after the Payment Date,  the  Securities or the portions of Securities to be
purchased in accordance  with the  provisions of this  Indenture  shall cease to
accrete.

SECTION 3.03.    DELIVERY OF SECURITIES AND PAYMENT OF PURCHASE PRICE.

      On the Payment Date, the Company shall deliver or cause to be delivered to
the Trustee the  Securities or portions  thereof so accepted on a pro rata basis
together with an Officers' Certificate stating the aggregate principal amount of
Securities  or portions  thereof  being  purchased  by the Company and that such
securities  were  accepted  for purchase by the Company in  accordance  with the
terms of Section 3.01 hereof. The Paying Agent shall promptly mail or deliver to
each  tendering  Holder an amount equal to the purchase  price of the Securities
tendered by such  Holder and  accepted  by the  Company  for  purchase,  and the
Company  shall  promptly  issue a new  Security,  and the Trustee,  upon written
request from the Company,  shall promptly  authenticate and mail or deliver such
new Security to such  Holder,  in a principal  amount  equal to any  unpurchased
portion  of the  Security  surrendered,  if any,  PROVIDED,  that  each such new
Security  shall be in a  principal  amount  of $1,000  or an  integral  multiple
thereof.  Any Security not so accepted shall be promptly  mailed or delivered by
the Company to the Holder  thereof.  The Company  shall  publicly  announce  the
results of an Offer to Purchase as soon as practicable after the Payment Date.

SECTION 3.04.    SECURITIES PURCHASED IN PART.

      Upon  surrender of a Security that is purchased in part, the Company shall
issue,  and upon the  Company's  written  request,  the Trustee  shall  promptly
authenticate  for the Holder at the expense of the Company a new Security  equal
in principal amount to the unpurchased portion of the Security surrendered.





                                      24


<PAGE>



                                   ARTICLE 4
                                  REDEMPTION.

SECTION 4.01.    RIGHT OF REDEMPTION

       The Securities will be redeemable,  at the Company's  option, in whole or
in part,  at any time or from time to time,  on or after  October  31,  2002 and
prior to  maturity,  upon not less than 30 nor more than 60 days'  prior  notice
mailed by  first-class  mail to each Holder at the following  Redemption  Prices
(expressed in percentages of the Accreted Value thereof) plus accrued and unpaid
interest, if any, to the Redemption Date (subject to the right of Holders on the
relevant  record  date  that is on or prior to the  Redemption  Date to  receive
interest  due on an Interest  Payment  Date),  if redeemed  during the  12-month
period commencing October 31, of the year set forth below:

                   Year                        Redemption Price
                   ----                        ----------------

                  2002                                105.500%
                  2003                                104.000%
                  2004                                102.500%
                  2005                                101.000%
                  2006 and thereafter                 100.000%

SECTION 4.02.     NOTICES TO TRUSTEE.

      If the Company  elects to redeem  Securities  pursuant to Section 4.01, it
shall  notify the Trustee in writing of the  Redemption  Date and the  principal
amount at  maturity  of  Securities  to be redeemed  plus  interest  accrued and
premium due thereon, if any, to the Redemption Date.

      The Company shall give each notice provided for in this Section 4.02 in an
Officers'  Certificate  at least five Business Days before mailing the notice to
Holders referred to in Section 4.01.

SECTION 4.03.     SELECTION OF SECURITIES TO BE REDEEMED.

      If less than all of the  Securities  are to be redeemed  at any time,  the
Trustee  shall  select the  Securities  to be  redeemed in  compliance  with the
requirements,  as  certified  to it by the Company,  of the  principal  national
securities  exchange,  if any,  on which the  Securities  are  listed or, if the
Securities  are not  listed on a  national  securities  exchange,  on a pro rata
basis,  by lot or by such other  method as the  Trustee  in its sole  discretion
shall deem fair and appropriate; PROVIDED, HOWEVER, that no Securities of $1,000
in principal amount at maturity or less shall be redeemed in part.




                                      25


<PAGE>



      The Trustee shall make the selection from the Securities  outstanding  and
not previously  called for redemption.  Securities in denominations of $1,000 in
principal  amount at maturity  may only be  redeemed  in whole.  The Trustee may
select for redemption  portions (equal to $1,000 in principal amount at maturity
or any integral multiple thereof) of Securities that have  denominations  larger
than $1,000 in principal  amount at maturity.  Provisions of this Indenture that
apply to Securities  called for redemption  also apply to portions of Securities
called for  redemption.  The Trustee  shall notify the Company and the Registrar
promptly in writing of the Securities or portions of Securities to be called for
redemption.

      If after a Security has been selected for partial redemption such Security
is converted  in part into  Conversion  Shares,  the  converted  portion of such
Security shall be deemed  (insofar as it may be) to be the portion  selected for
redemption.  The  Securities  (or portions  thereof) so selected shall be deemed
duly selected for redemption for all purposes hereof,  notwithstanding  that any
such Security is converted into Conversion Shares in whole or in part before the
notice of redemption is mailed.

      Upon any  redemption of less than all of the  Securities,  the Company and
the Trustee may treat as outstanding  any Securities  surrendered for conversion
during the period that is 15 days  preceding  the date a notice of redemption is
mailed and are not required to treat as outstanding  any Security  authenticated
and delivered during such period in exchange for the unconverted  portion of any
Security converted in part during such period.

SECTION 4.04.     NOTICE OF REDEMPTION.

      With respect to any redemption of Securities  pursuant to Section 4.01, at
least 30 days but not more than 60 days before a  Redemption  Date,  the Company
shall  mail a notice of  redemption  by first  class mail to each  Holder  whose
Securities are to be redeemed.

      The notice shall identify the Securities to be redeemed and shall state:

            (a)   the Redemption Date;

            (b)   the Redemption Price;

            (c) the current  Conversion Price and the date on which the right to
            convert such Securities or portions  thereof into Conversion  Shares
            shall  expire  (which  date  shall be the close of  business  on the
            Trading Day next preceding such  Redemption  Date unless the Company
            defaults in payment of the Redemption Price);

            (d)   the name and address of the Paying Agent;

            (e) that Securities called for redemption must be surrendered to the
            Paying Agent in order to collect the Redemption Price;



                                      26


<PAGE>



            (f) that,  unless the Company  defaults  in making  such  redemption
            payment,  interest on  Securities  called for  redemption  ceases to
            accrue on and after the Redemption Date and the only remaining right
            of the Holders is to receive  payment of the  Redemption  Price plus
            accrued  interest  to the  Redemption  Date  upon  surrender  of the
            Securities to the Paying Agent;

            (g) that, if any Security is being  redeemed in part, the portion of
            the  principal  amount at  maturity  (equal  to $1,000 in  principal
            amount  at  maturity  or any  integral  multiple  thereof)  of  such
            Security to be redeemed and that, on and after the Redemption  Date,
            upon  surrender of such  Security,  a new Security or  Securities in
            principal amount at maturity equal to the unredeemed portion thereof
            will be reissued; and

            (h) that, if any Security  contains a CUSIP or other  identification
            number as provided in Section 2.12, no  representation is being made
            as to the  correctness of the CUSIP or other  identification  number
            either as printed on the Securities or as contained in the notice of
            redemption  and  that  reliance  may be  placed  only  on the  other
            identification numbers printed on the Securities.

      At the Company's  request  (which request may be revoked by the Company at
any time prior to the time at which the Trustee  shall have given such notice to
the Holders),  made in writing to the Trustee at least five Business Days before
mailing the notice to Holders  referred to in Section  4.01,  the Trustee  shall
give such notice of  redemption  in the name and at the expense of the  Company.
If,  however,  the Company  gives such notice to the Holders,  the Company shall
concurrently  deliver to the Trustee an Officers'  Certificate stating that such
notice has been given.

SECTION 4.05.     EFFECT OF NOTICE OF REDEMPTION.

      Once notice of redemption  is mailed,  Securities  called for  redemption,
unless  converted to  Conversion  Shares in  accordance  with the terms  hereof,
become due and payable on the Redemption Date and at the Redemption  Price. Upon
surrender of any Securities to the Paying Agent,  such Securities  shall be paid
at the Redemption Price, plus accrued interest, if any, to the Redemption Date.

      Notice of redemption  shall be deemed to be given when mailed,  whether or
not the Holder receives the notice.  In any event,  failure to give such notice,
or any defect therein,  shall not affect the validity of the proceedings for the
redemption of Securities held by Holders to whom such notice was properly given.




                                      27


<PAGE>



SECTION 4.06.     DEPOSIT OF REDEMPTION PRICE.

      On or prior to any  Redemption  Date,  the Company  shall deposit with the
Paying  Agent  money  sufficient  to pay the  Redemption  Price  of and  accrued
interest,  if any,  on all  Securities  to be  redeemed  on that date other than
Securities or portions  thereof called for redemption on that date that (a) have
been delivered by the Company to the Trustee for  cancellation  or (b) have been
surrendered for conversion into Conversion Shares.

SECTION 4.07.     PAYMENT OF SECURITIES CALLED FOR REDEMPTION.

      If notice of redemption has been given in the manner provided  above,  the
Securities  or portion of  Securities  specified  in such  notice to be redeemed
shall,  unless  converted  to  Conversion  Shares in  accordance  with the terms
hereof,  become due and payable on the Redemption  Date at the Redemption  Price
stated herein,  together with accrued interest, if any, to such Redemption Date,
and on and after such date (unless the Company  shall  default in the payment of
such Securities at the Redemption  Price and accrued  interest to the Redemption
Date,  in which case the  principal,  until paid,  shall bear  interest from the
Redemption Date at the rate prescribed in the Securities), such Securities shall
cease to accrue  interest.  Such Securities  shall no longer be convertible into
Conversion  Shares at the close of business  on the  Trading Day next  preceding
such  Redemption  Date.  Upon  surrender  of  any  Security  for  redemption  in
accordance with a notice of redemption, such Security shall be paid and redeemed
by the Company at the Redemption Price,  together with accrued interest, if any,
to the  Redemption  Date;  PROVIDED that  installments  of interest whose Stated
Maturity is on or prior to the  Redemption  Date shall be payable to the Holders
registered as such at the close of business on the relevant record date.

SECTION 4.08.     SECURITIES REDEEMED IN PART.

      Upon surrender of any Security that is redeemed in part, the Company shall
execute  and the  Trustee  shall  authenticate  and  deliver to the Holder a new
Security equal in principal amount at maturity to the unredeemed portion of such
surrendered Security.


                                   ARTICLE 5
                                   COVENANTS

SECTION 5.01.     PAYMENT OF SECURITIES.

      The Company  shall pay or cause to be paid the  principal of, and premium,
if any, and interest on the  Securities on the dates and in the manner  provided
in the  Securities.  Principal,  and  premium,  if any,  and  interest  shall be
considered  paid on the date due if the Trustee or Paying  Agent,  if other than
the  Company,  holds as of 10:00  a.m.  New York City time on the due date money
deposited by the Company in immediately  available  funds and designated for and
sufficient to pay all principal, and premium, if any, and interest then due, and




                                      28


<PAGE>


the  Trustee or Paying  Agent is not  prohibited  from  paying such money to the
Holders in accordance with the terms of this Indenture.

      The Company  shall pay, to the extent such  payments are lawful,  interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue  principal  and premium from time to time on demand at the rate borne by
the Securities  plus 2% per annum.  Interest shall be computed on the basis of a
360-day year comprised of twelve 30-day months.

      The Company shall pay interest  (including  post-petition  interest in any
proceeding  under Bankruptcy Law) on overdue  installments of interest  (without
regard to any applicable grace period) at the same rate to the extent lawful.

      Notwithstanding  anything to the contrary contained in this Indenture, the
Company  may, to the extent it is  required to do so by law,  deduct or withhold
income or other  similar  taxes  imposed  by the United  States of America  from
principal or interest payments hereunder.

SECTION 5.02.     MAINTENANCE OF OFFICE OR AGENCY.

      The Company  shall  maintain the office or agency  required  under Section
2.03.  The Company shall give prior notice to the Trustee of the  location,  and
any change in the location, of such office or agency. If at any time the Company
shall  fail to  maintain  any such  required  office or agency or shall  fail to
furnish the Trustee with the address thereof,  such  presentations,  surrenders,
notices  and  demands  may be made or served at the  address of the  Trustee set
forth in Section 12.01.

SECTION 5.03.     REPORTS AND OTHER COMMUNICATIONS.

      (a) At the Company's  expense,  following the first fiscal  quarter ending
after the date of this  Indenture  and  regardless  of  whether  the  Company is
required to furnish such reports to its  stockholders  pursuant to the rules and
regulations of the Commission, for so long as the Securities remain outstanding,
the  Company  shall  furnish to the  Holders (i) within 45 days after the end of
each of the first three  fiscal  quarters of each fiscal year and 90 days of the
end of each fiscal year all quarterly and annual financial  information,  as the
case may be,  that  would  be  required  to be  contained  in a filing  with the
Commission  on Forms 10-QSB and 10-KSB (or any  successor  Forms) if the Company
were  required to file such  Forms,  including a  "Management's  Discussion  and
Analysis of Financial  Condition Results of Operations" and, with respect to the
annual  information  only, an audit report and opinion  thereon by the Company's
certified  independent  accountants  and (ii) all current  reports that would be
required to be filed with the Commission on Form 8-K (or any successor  Form) if
the Company were  required to file such  reports.  In  addition,  whether or not
required by the rules and regulations of the Commission, the Company will file a
copy of all  such  information  and  reports  with  the  Commission  for  public
availability (unless the Commission will not accept such a filing) and make such
information  available to securities  analysts and  prospective  investors  upon





                                      29


<PAGE>


request.  In addition,  promptly upon receipt,  at the  Company's  expense,  the
Company shall furnish to the Holders  copies of all  communications  from Burger
King Corporation or Domino's Pizza  (including any of their  designees,  agents,
counsel  and  representatives)  as to all  matters  material  to  the  Company's
franchise business.

      (b) Such  reports  and  other  communications  shall be  delivered  to the
Registrar in a sufficient  number for  distribution  and the Registrar will mail
them at the Company's expense to the Holders at their addresses appearing in the
Security Register.

      (c) Each of the  Holders  shall  have the  right,  from  time to time upon
reasonable  notice to the Company and at such Holder's own cost and expense (or,
while any Default or Event of Default is  continuing,  at the Company's cost and
expense), during normal business hours and at reasonable times and intervals, to
inspect the books and records of the Company at its offices maintained  pursuant
to Section 2.03 hereof and  elsewhere and to discuss the business and affairs of
the Company with members of management designated by the Company.

SECTION 5.04.     COMPLIANCE CERTIFICATES.

      (a) The Company shall deliver to the Trustee, within 90 days after the end
of each fiscal  year,  an  Officers'  Certificate  stating  that a review of the
activities of the Company and its Subsidiaries  during the preceding fiscal year
has been made  under the  supervision  of the  signing  Officers  with a view to
determining whether the Company has kept, observed,  performed and fulfilled its
obligations under this Indenture, and further,  stating, as to each such Officer
signing such  certificate,  that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the  performance or observance of any of
the terms,  provisions  and  conditions of this  Indenture  (or, if a Default or
Event of Default shall have occurred,  describing all such Defaults or Events of
Default of which he or she may have  knowledge  and what  action the  Company is
taking or proposes to take with respect  thereto) and that to the best of his or
her  knowledge no event has occurred and remains in existence by reason of which
payments  on  account of the  principal  of or  interest  on the  Securities  is
prohibited  or if such event has occurred,  a description  of the event and what
action the Company is taking or proposes to take with respect thereto.

      (b) So long as not  contrary to the then  current  recommendations  of the
American  Institute  of Certified  Public  Accountants,  the year-end  financial
statements delivered pursuant to Section 5.03(a) above shall be accompanied by a
written statement of the Company's  independent public accountants (who shall be
a firm of  established  national  reputation)  that in  making  the  examination
necessary for  certification of such financial  statements,  nothing has come to
their  attention  that would lead them to believe  that the Company has violated
any  provisions  of Article 5 or Article 6 hereof or, if any such  violation has
occurred,  specifying  the  nature  and period of  existence  thereof,  it being
understood that such  accountants  shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.




                                      30


<PAGE>



      (c) The Company shall,  so long as any of the Securities are  outstanding,
deliver to the Trustee, forthwith upon any Officer becoming aware of any Default
or Event of Default, an Officers'  Certificate  specifying such Default or Event
of Default  and what  action  the  Company  is taking or  proposes  to take with
respect thereto.

SECTION 5.05.     TAXES.

      The Company  shall pay, and shall cause each of its  Subsidiaries  to pay,
prior to delinquency,  all material taxes, assessments,  and governmental levies
except such as are  contested in good faith and by  appropriate  proceedings  or
where the failure to effect such payment is not adverse in any material  respect
to the Holders of the Securities.

SECTION 5.06.     WAIVER OF STAY, EXTENSION AND USURY LAWS.

      The Company  covenants  (to the extent that it may lawfully do so) that it
shall not at any time insist upon,  plead, or in any manner  whatsoever claim or
take the benefit or advantage of, any stay,  extension or usury law or any other
law that would prohibit or forgive the Company from paying all or any portion of
the principal of, premium, if any, or interest on the Securities as contemplated
herein,  whenever  enacted,  now or at any time hereafter in force, or which may
affect the covenants or the  performance of this  Indenture,  and (to the extent
that it may lawfully do so) the Company hereby  expressly  waives 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 shall
suffer and permit  the  execution  of every such power as though no such law has
been enacted.

SECTION 5.07      RESTRICTED PAYMENTS

      The  Company  shall  not,  and  shall  not  permit  any of its  Restricted
Subsidiaries to, directly or indirectly, (i) declare or pay any dividend or make
any  distribution  on its Capital Stock (other than  dividends or  distributions
payable solely in shares of its or such  Restricted  Subsidiary's  Capital Stock
(other than  Redeemable  Stock) held by such holders or in options,  warrants or
other  rights to acquire  such shares of Capital  Stock) other than such Capital
Stock held by the Company or any of its Restricted  Subsidiaries (and other than
pro rata dividends or  distributions  on Common Stock of Wholly Owned Restricted
Subsidiaries),  (ii) repurchase,  redeem,  retire or otherwise acquire for value
any  shares  of  Capital  Stock  of the  Company  or any  Restricted  Subsidiary
(including  options,  warrants or other rights to acquire such shares of Capital
Stock)  held by Persons  other than the Company or any Wholly  Owned  Restricted
Subsidiaries  of  the  Company,   except,  in  the  case  of  Capital  Stock  of
International   Fast  Food  Polska  ("IFFP")  held  by  Agros  Holding  S.A.  or
transferees  of Agros  Holding  S.A.,  (iii)  make  any  voluntary  or  optional
principal payment, or voluntary or optional redemption,  repurchase, defeasance,
or other  acquisition or retirement for value,  of  Indebtedness  of the Company
that is  subordinated  in right of payment to the  Securities,  or (iv) make any
investment,  other than a Permitted Investment,  in any Person (such payments or




                                      31


<PAGE>


any other  actions  described  in clauses  (i) through  (iv) being  collectively
"Restricted  Payments")  if, at the time of,  and after  giving  effect  to, the
proposed  Restricted  Payment:  (A) a Default  or Event of  Default  shall  have
occurred and be  continuing,  (B) except with respect to any  Investment  (other
than an Investment  consisting of the designation of a Restricted  Subsidiary as
an  Unrestricted  Subsidiary),  the  Company  could not incur at least  $1.00 of
Indebtedness  under the first  paragraph  of Section  5.09 or (C) the  aggregate
amount  expended for all Restricted  Payments (the amount so expended,  if other
than in cash, to be  determined  in good faith by the Board of Directors,  whose
determination shall be conclusive and evidenced by a Board Resolution) after the
Closing  Date  shall  exceed the sum of (1) 50% of the  aggregate  amount of the
Adjusted Consolidated Net Income (or, if the Adjusted Consolidated Net Income is
a loss,  minus 100% of such amount)  (determined by excluding  income  resulting
from  transfers  of assets  by the  Company  or a  Restricted  Subsidiary  to an
Unrestricted  Subsidiary) accrued on a cumulative basis during the period (taken
as one  accounting  period)  beginning  on the first day of the  fiscal  quarter
immediately  following  the Closing  Date and ending on the last day of the last
fiscal quarter  preceding the Transaction Date for which reports have been filed
pursuant to Section 5.03 PLUS (2) the aggregate  Net Cash  Proceeds  received by
the Company after the Closing Date from the issuance and sale  permitted by this
Indenture of its Capital Stock (other than Redeemable  Stock) to a Person who is
not a Subsidiary  of the Company,  or from the issuance to a Person who is not a
Subsidiary  of the Company of any  options,  warrants or other rights to acquire
Capital  Stock  of the  Company  (in each  case,  exclusive  of any  convertible
Indebtedness, Redeemable Stock or any options, warrants or other rights that are
redeemable at the option of the holder, or are required to be redeemed, prior to
the Stated  Maturity  of the  Securities),  PLUS (3) an amount  equal to the net
reduction in  Investments  in any Person  resulting from payments of interest on
Indebtedness,  dividends, repayments of loans or advances, or other transfers of
assets, in each case to the Company or any Restricted  Subsidiary (except to the
extent any such payment is included in the calculation of Adjusted  Consolidated
Net Income),  or from  redesignation of Unrestricted  Subsidiaries as Restricted
Subsidiaries   (valued  in  each  case  as   provided  in  the   definition   of
"Investments"),  not to exceed the amount of Investments  previously made by the
Company and its Restricted Subsidiaries in such Person.

      The  foregoing  provision  shall not be  violated  by reason  of:  (i) the
payment of any dividend within 60 days after the date of declaration thereof if,
at said date of  declaration,  such  payment  would  comply  with the  foregoing
paragraph; (ii) the redemption,  repurchase,  defeasance or other acquisition or
retirement for value of Indebtedness that is subordinated in right of payment to
the Securities, including premium, if any, and accrued and unpaid interest, with
the proceeds of, or in exchange for, Indebtedness incurred under clause (iii) of
the second paragraph of Section 5.09; (iii) the repurchase,  redemption or other
acquisition  of Capital  Stock of the  Company  (or  options,  warrants or other
rights to acquire such Capital Stock) in exchange for, or out of the proceeds of
a  substantially  concurrent  offering of,  shares of Capital  Stock or options,
warrants or other rights to acquire such Capital  Stock (in each case other than
Redeemable Stock) of the Company;  (iv) cash payments in lieu of the issuance of
fractional  shares  of  Common  Stock  upon  conversion   (including   mandatory
conversion) of the Securities  provided for in this Indenture;  PROVIDED that no




                                      32


<PAGE>


Default or Event of Default  shall have occurred and be continuing or occur as a
consequence of the actions or payments set forth herein.  Any  Investments  made
other than in cash shall be valued, in good faith, by the Board of Directors.

      Each  Restricted  Payment  permitted  pursuant to the preceding  paragraph
(other than the Restricted Payment referred to in clause (ii) thereof),  and the
Net Cash Proceeds from any issuance of Capital Stock referred to in clause (iii)
shall be included in  calculating  whether the  conditions  of clause (C) of the
first  paragraph  of this  Section  5.07  have  been  met  with  respect  to any
subsequent  Restricted  Payments.  In the event the  proceeds  of an issuance of
Capital  Stock of the Company are used for the  redemption,  repurchase or other
acquisition  of the  Securities  or  Indebtedness  that is PARI  PASSU  with the
Securities,  as the case may be,  then the Net Cash  Proceeds  of such  issuance
shall be included in clause (C) of the first paragraph of this Section 5.07 only
to the extent such  proceeds  are not used for such  redemption,  repurchase  or
other acquisition of Indebtedness.

      Not later than the date of making any  Restricted  Payment  (other than an
Investment  in cash  equivalents),  the Company  shall deliver to the Trustee an
Officers'  Certificate  stating that such  Restricted  Payment is permitted  and
setting forth the basis upon which its calculations were computed.

SECTION 5.08.     DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING
                  RESTRICTED SUBSIDIARIES.

      The  Company  shall  not,  and  shall  not  permit  any of its  Restricted
Subsidiaries to, directly or indirectly,  create or otherwise cause or suffer to
exist or become effective any consensual  encumbrance or restriction of any kind
on the ability of any  Restricted  Subsidiary  to (i) pay  dividends or make any
other  distributions  permitted by  applicable  law on any Capital Stock of such
Restricted  Subsidiary owned by the Company or any other Restricted  Subsidiary,
(ii) pay any Indebtedness owed to the Company or any other Restricted Subsidiary
that  owns,  directly  or  indirectly,  any  Capital  Stock  of such  Restricted
Subsidiary,  (iii) make loans or advances to the Company or any other Restricted
Subsidiary  that  owns,  directly  or  indirectly,  any  Capital  Stock  of such
Restricted  Subsidiary  or (iv)  transfer  any of its  property or assets to the
Company or any other  Restricted  Subsidiary that owns,  directly or indirectly,
any Capital Stock of such Restricted Subsidiary.

      The  foregoing   provisions   shall  not  prohibit  any   encumbrances  or
restrictions:  (i) existing on the Closing  Date in this  Indenture or any other
agreement  in effect on the  Closing  Date,  and any  extensions,  refinancings,
renewals or replacements of such agreements;  PROVIDED that the encumbrances and
restrictions in any such extensions,  refinancings, renewals or replacements are
no less favorable in any material respect to the Holders than those encumbrances
or restrictions that are then in effect and that are being extended, refinanced,
renewed or replaced;  (ii) existing under or by reason of applicable  law; (iii)
existing  with  respect to any Person or the  property  or assets of such Person
acquired  by the  Company  or any  Restricted  Subsidiary,  at the  time of such
acquisition and not incurred in  contemplation  thereof,  which  encumbrances or




                                      33


<PAGE>


restrictions  are not  applicable to any Person or the property or assets of any
Person  other  than such  Person  or the  property  or assets of such  Person so
acquired; (iv) in the case of clause (iv) of the first paragraph of this Section
5.08,  (A) that  restrict in a customary  manner the  subletting,  assignment or
transfer  of any  property  or asset  that is a lease,  license,  conveyance  or
contract or similar  property or asset,  (B)  existing by virtue of any transfer
of,  agreement  to  transfer,  option or right with  respect to, or Lien on, any
property or assets of the Company or any  Restricted  Subsidiary  nor  otherwise
prohibited by this Indenture or (C) arising or agreed to in the ordinary  course
of business, not relating to any Indebtedness,  and that do not, individually or
in the aggregate, detract from the value of property or assets of the Company or
any  Restricted  Subsidiary  in  any  manner  material  to  the  Company  or any
Restricted  Subsidiary;  (v) with respect to a Restricted Subsidiary and imposed
pursuant to an agreement  that has been entered into for the sale or disposition
of all or substantially  all of the Capital Stock of, or property and assets of,
such  Restricted  Subsidiary;  or  (vi)  incurred  pursuant  to  any  Restricted
Subsidiary Indebtedness permitted under this Indenture, PROVIDED that the amount
actually  subject to such  encumbrance  or  restriction  shall not be taken into
account  when  calculating  the  Consolidated  EBITDA  of such  Person.  Nothing
contained  in this  Section  5.08 shall  prevent the  Company or any  Restricted
Subsidiary  from (1)  creating,  incurring,  assuming or  suffering to exist any
Liens  otherwise  permitted in Section 5.12 or (2) restricting the sale or other
disposition  of  property  or assets  of the  Company  or any of its  Restricted
Subsidiaries  that secure  Indebtedness  of the Company or any of its Restricted
Subsidiaries.

SECTION 5.09      INCURRENCE OF INDEBTEDNESS

      The Company shall not, and shall not permit any Restricted  Subsidiary to,
directly or indirectly,  Incur any Other Indebtedness if, after giving effect to
the Incurrence of such Other Indebtedness and the receipt and application of the
proceeds therefrom, the ratio of Other Indebtedness to Consolidated EBITDA would
be greater than 3:1.

      Notwithstanding the foregoing, the Company and its Restricted Subsidiaries
(except as specified below) may incur each and all of the following:  (i) Senior
Indebtedness  of the Company  outstanding at any time in an aggregate  principal
amount not to exceed $2.5 million,  less any amount of Indebtedness  permanently
repaid as provided  under Section  5.10;  (ii)  Indebtedness  (A) to the Company
evidenced by an  unsubordinated  promissory note or (B) to any of its Restricted
Subsidiaries;  PROVIDED  that any event  which  results  in any such  Restricted
Subsidiary ceasing to be a Restricted  Subsidiary or any subsequent  transfer of
such Indebtedness  (other than to the Company or another Restricted  Subsidiary)
shall be deemed,  in each case, to constitute an Incurrence of such Indebtedness
not permitted by this clause (ii); (iii) Indebtedness issued in exchange for, or
the net  proceeds of which are used to  refinance  or refund,  then  outstanding
Indebtedness, and any refinancings thereof in an amount not to exceed the amount
so refinanced or refunded (plus premiums,  accrued interest, fees and expenses);
PROVIDED that such new Indebtedness,  determined as of the date of incurrence of
such new  Indebtedness,  does not  mature  prior to the Stated  Maturity  of the
Indebtedness  to be  refinanced  or  refunded,  and the Average Life of such new




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<PAGE>


Indebtedness is at least equal to the remaining Average Life of the Indebtedness
to be  refinanced  or  refunded;  and  PROVIDED  FURTHER  that in no  event  may
Indebtedness  of the Company be refinanced by means of any  Indebtedness  of any
Restricted  Subsidiary  of the  Company  pursuant  to this  clause  (iii);  (iv)
Indebtedness  (A) in respect of performance,  surety or appeal bonds provided in
the ordinary course of business,  and (B) under Currency Agreements and Interest
Rate Agreements;  PROVIDED that such agreements do not increase the Indebtedness
of the obligor outstanding at any time other than as a result of fluctuations in
foreign  currency  exchange  rates  or  interest  rates  or by  reason  of fees,
indemnities and compensation payable thereunder; (v) Indebtedness of the Company
not to  exceed,  at any one time  outstanding,  1.5 times the Net Cash  Proceeds
received by the Company after the Closing Date from the issuance and sale of its
Capital Stock (other than Redeemable Stock and Preferred Stock that provides for
the  payment  of  dividends  in  cash);  (vi)  Indebtedness  up to  $10  million
outstanding  at any time to the  extent  such  Indebtedness  is secured by Liens
permitted  under  clause (vi) of the second  paragraph of Section 5.12 and (vii)
Indebtedness  of the  Company  or a  Restricted  Subsidiary,  to the  extent the
proceeds  thereof are  immediately  used to purchase  Securities  tendered in an
Offer to Purchase made as a result of a Change of Control.

      (b) For purposes of determining  compliance with this Section 5.09, in the
event that an item of  Indebtedness  meets the  criteria of more than one of the
types of Indebtedness  described in the above clauses,  the Company, in its sole
discretion,  shall  classify such item of  Indebtedness  and only be required to
include the amount and type of such Indebtedness in one of such clauses.

SECTION 5.10.     ASSET SALES.

      The  Company  shall  not,  and  shall  not  permit  any of its  Restricted
Subsidiaries  to,  consummate  any  Asset  Sale,  unless  (i) the  consideration
received by the Company or such  Restricted  Subsidiary is at least equal to the
fair market value of the assets sold or disposed of and (ii) at least 80% of the
consideration received consists of cash or Temporary Cash Investments,  provided
that the amount of any Senior Indebtedness or Restricted Subsidiary Indebtedness
(as shown on the Company's or such Restricted  Subsidiary's  most recent balance
sheet or notes thereto) of the Company or such  Restricted  Subsidiary  which is
assumed by the transferee as a credit against the purchase price shall be deemed
to be cash to the  extent  of the  amount so  credited.  In the event and to the
extent that the Net Cash  Proceeds  received  by the  Company or its  Restricted
Subsidiaries from one or more Asset Sales occurring on or after the Closing Date
in any period of 12  consecutive  months exceed the greater of $1 million or 10%
of Adjusted  Consolidated Net Tangible Assets (determined as of the date closest
to the  commencement  of such 12-month  period for which a consolidated  balance
sheet of the Company and its Subsidiaries  has been prepared),  then the Company
shall or shall cause the relevant Restricted Subsidiary to (i) within six months
after the date Net Cash Proceeds so received exceed the greater of $1 million or
10% of Adjusted  Consolidated Net Tangible Assets (A) apply, or resolve by Board
of Directors  resolutions to apply no later than one year after the consummation
of such  Asset  Sale,  an  amount  equal to such  excess  Net Cash  Proceeds  to
permanently repay Senior Indebtedness of the Company, or any indebtedness of any





                                      35


<PAGE>


Restricted Subsidiary,  in each case owing to a Person other than the Company or
any of its Restricted  Subsidiaries or (B) invest an equal amount, or the amount
not so applied  pursuant  to clause (A) (or enter  into a  definitive  agreement
committing to so invest within six months after the date of such agreement),  in
property  or assets of a nature or type or that are used in a business  (or in a
company  having  property  and  assets  of a nature  or type,  or  engaged  in a
business)  similar or related to the nature or type of the  property  and assets
of, or the business of, the Company and its Restricted  Subsidiaries existing on
the  date of such  investment  (as  determined  in good  faith  by the  Board of
Directors,  whose  determination  shall be  conclusive  and evidenced by a Board
Resolution)  and (ii)  apply  (no  later  than the end of the  six-month  period
referred  to in clause  (i)) such  excess Net Cash  Proceeds  (to the extent not
applied  pursuant to clause (i)) as provided in the following  paragraph of this
Section 5.10. The amount of such excess Net Cash Proceeds required to be applied
(or to be committed to be applied)  during such six-month or 12-month  period as
set forth in clause (i) of the preceding sentence and not applied as so required
by the end of such period shall constitute "Excess Proceeds."

      If, as of the first day of any calendar  month,  the  aggregate  amount of
Excess Proceeds not theretofore subject to an Offer to Purchase pursuant to this
Section 5.10 totals at least $3 million,  the Company must  commence,  not later
than the  fifteenth  Business  Day of such  month,  and  consummate  an Offer to
Purchase  from the Holders of the  Securities  on a pro rata basis an  aggregate
principal  amount of Securities  equal to the Excess Proceeds on such date, at a
purchase price equal to 100% of the Accreted Value of the  Securities,  plus, in
each case, accrued interest (if any) to the date of purchase.

SECTION 5.11.     TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES.

      The  Company  shall  not,  and  shall  not  permit  any of its  Restricted
Subsidiaries  to,  directly  or  indirectly,  enter  into,  renew or extend  any
transaction  (including,  without  limitation,  the  purchase,  sale,  lease  or
exchange of property or assets, or the rendering of any service) with any holder
(or any Affiliate of such holder) of 5% or more of any class of Capital Stock of
the Company or with any Affiliate of the Company or any  Restricted  Subsidiary,
except upon fair and  reasonable  terms no less favorable to the Company or such
Restricted  Subsidiary than could be obtained,  at the time of such  transaction
or, if such transaction is pursuant to a written  agreement,  at the time of the
execution of the  agreement  providing  therefor,  in a comparable  arm's-length
transaction with a Person that is not such a holder or an Affiliate.

      The  foregoing  limitation  does not  limit,  and shall not apply to:  (i)
transactions  (A)  approved  by a majority of the  disinterested  members of the
Board of  Directors  or (B) for which the  Company  or a  Restricted  Subsidiary
delivers to the Trustee a written opinion of a nationally  recognized investment
banking  firm  stating  that  the  transaction  is fair to the  Company  or such
Restricted  Subsidiary  from a  financial  point of view;  (ii) any  transaction
solely between the Company and any of its Wholly Owned  Restricted  Subsidiaries
or solely between  Wholly Owned  Restricted  Subsidiaries;  (iii) the payment of
reasonable  fees to  directors  of the  Company  who are  not  employees  of the




                                      36


<PAGE>


Company; or (iv) any payments or other transactions  pursuant to any tax-sharing
agreement  between the Company and any other Person with which the Company files
a  consolidated  tax return or with which the Company is part of a  consolidated
group for tax purposes.  Notwithstanding the foregoing,  any transaction covered
by the first  paragraph  of this  Section  5.11 and not covered by clauses  (ii)
through (iv) of this paragraph,  the aggregate  amount of which exceeds $100,000
in value,  must be approved or determined to be fair in the manner  provided for
in clause (i)(A) or (B) above.

SECTION 5.12.     LIENS.

      The  Company  shall  not,  and  shall  not  permit  any of its  Restricted
Subsidiaries  to,  directly or indirectly,  create,  incur,  assume or suffer to
exist  any Lien on any of its  assets or  properties  of any  character,  or any
shares  of  Capital  Stock  or   Indebtedness   of  any  Restricted   Subsidiary
(collectively, "Protected Property"), without making effective provision for all
of the  Securities and all other amounts due under this Indenture to be directly
secured  equally and ratably  with (or, if the  obligation  or  liability  to be
secured by such Lien is subordinated in right of payment to the Securities prior
to) the obligation or liability secured by such Lien.

      The  foregoing  limitation  does not apply to: (i) Liens  existing  on the
Closing Date; (ii) Liens granted after the Closing Date on any assets or Capital
Stock of the  Company  or its  Restricted  Subsidiaries  created in favor of the
Holders  of  the  Securities;  (iii)  Liens  with  respect  to the  assets  of a
Restricted Subsidiary granted by such Restricted Subsidiary to the Company, IFFP
or a Wholly Owned  Restricted  Subsidiary  to secure  Indebtedness  owing to the
Company or such other Restricted  Subsidiary;  (iv) Liens securing  Indebtedness
which is incurred to  refinance  secured  indebtedness  which is permitted to be
incurred  under clause (iii) of the second  paragraph of Section 5.09,  PROVIDED
that such Liens do not extend to or cover any  property or assets of the Company
or any  Restricted  Subsidiary  other than the  property or assets  securing the
Indebtedness being refinanced;  (v) purchase money Liens upon equipment acquired
or held by the Company or any of its Restricted  Subsidiaries  taken or retained
by the  seller of such  inventory  or  equipment  to secure all or a part of the
purchase price therefor;  PROVIDED that such Liens do not extend to or cover any
property or assets of the Company or any  Restricted  Subsidiary  other than the
inventory or equipment acquired; or (vi) Permitted Liens.

SECTION 5.13.     CONDUCT OF BUSINESS.

      The  Company  shall  not,  and  shall  not  permit  any of its  Restricted
Subsidiaries  to, directly or indirectly,  engage in any business other than the
franchising of fast food restaurants in Poland or other  jurisdictions in Europe
in which the Company  receives  the right to  franchise  fast food  restaurants;
PROVIDED that any operations  outside of Poland are conducted  through direct or
indirect  wholly-owned  subsidiaries  of the  Company,  and any  other  activity
reasonably  related to such  activities;  and FURTHER  PROVIDED that the Company
shall not invest 25% or more of its consolidated assets (measured as of the most
recent date for which  balance  sheets were  delivered  pursuant to Section 5.03
hereof) in businesses other than Burger King and Domino's franchises without the
consent of the  Holders of a majority  of the  outstanding  principal  amount of
Securities.


                                      37


<PAGE>





SECTION 5.14      CORPORATE EXISTENCE.

      Subject to Article 6 hereof,  the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its corporate
existence,  and the  corporate,  partnership  or other  existence of each of its
Restricted  Subsidiaries,  in  accordance  with  the  respective  organizational
documents  (as the same may be amended from time to time) of the Company or such
Restricted Subsidiary and (ii) the rights (charter and statutory),  licenses and
franchises of the Company and its Restricted  Subsidiaries;  PROVIDED,  HOWEVER,
that the Company  shall not be required to preserve  any such right,  license or
franchise,  or the  corporate,  partnership  or  other  existence  of any of its
Restricted Subsidiaries,  if the Board of Directors shall reasonably and in good
faith  determine  that the  preservation  thereof is no longer  desirable in the
conduct of business of the Company and its  Subsidiaries,  taken as a whole, and
that the loss thereof is not adverse in any  material  respect to the Holders of
the Securities.  The Company shall comply,  in all material  respects,  with the
terms  and  provisions  of each of its  agreements  with  each  of  Burger  King
Corporation  and Domino's  Pizza,  except for such  noncompliance  as would not,
individually  or in the  aggregate,  give rise to a right in the other  party to
terminate or suspend any such agreement.

SECTION 5.15.     OFFER TO REPURCHASE UPON CHANGE OF CONTROL.

      The Company must commence, within 30 days of the occurrence of a Change of
Control,  and  consummate  an  Offer to  Purchase  for all the  Securities  then
outstanding,  at a purchase  price equal to 101% of the Accreted  Value thereof,
plus accrued interest (if any) to the date of purchase.  Prior to the mailing of
the notice to Holders of Securities  commencing  such Offer to Purchase,  but in
any event within 30 days following any Change of Control,  the Company covenants
to (i) repay in full all  indebtedness  of the Company  that would  prohibit the
repurchase of the  Securities  pursuant to such Offer to Purchase or (ii) obtain
any requisite consents under instruments  governing any such indebtedness of the
Company to permit the  repurchase  of the  Securities.  The Company  shall first
comply with the covenant in the preceding  sentence  before it shall  repurchase
Securities pursuant to this Section 5.15.

SECTION 5.16.     STATUS AS INVESTMENT COMPANY.

      The  Company  shall  not,  and  shall  not  permit  any of its  Restricted
Subsidiaries  to,  conduct its  business in a fashion  that would cause it to be
required to register as an "investment  company" (as that term is defined in the
Investment  Company Act of 1940,  as amended),  or otherwise  become  subject to
regulation under the Investment Company Act of 1940, as amended.





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<PAGE>



SECTION 5.17.     DESIGNATION OF RESTRICTED SUBSIDIARY AS UNRESTRICTED
                  SUBSIDIARY; REDESIGNATION OF UNRESTRICTED SUBSIDIARY AS
                  RESTRICTED SUBSIDIARY

        The Board of Directors may designate  any  Restricted  Subsidiary of the
Company  (including  any  newly  acquired  or  newly  formed  Subsidiary  of the
Company),  other  than a  Subsidiary  that  has  become  a  guarantor,  to be an
Unrestricted  Subsidiary  unless such  Subsidiary  owns any Capital Stock of, or
owns or  holds  any Lien on any  property  of,  the  Company  or any  Restricted
Subsidiary;  PROVIDED that neither the Company nor its  Restricted  Subsidiaries
has any Guarantee of any Indebtedness of such Subsidiary outstanding at the time
of such  designation and either (A) the Subsidiary to be so designated has total
assets of $1,000  or less or (B) if such  Subsidiary  has  assets  greater  than
$1,000,  that such designation  would be permitted under Section 5.07. The Board
of  Directors  may  designate  any  Unrestricted  Subsidiary  to be a Restricted
Subsidiary of the Company; PROVIDED that immediately after giving effect to such
designation (x) the Company could incur $1.00 of additional  Indebtedness  under
the first paragraph of Section 5.09 and (y) no Default or Event of Default shall
have occurred and be continuing.  Any such designation by the Board of Directors
shall be evidenced to the Trustee by promptly  filing with the Trustee a copy of
the  Board  Resolution  giving  effect  to  such  designation  and an  Officers'
Certificate  certifying  that  such  designation  complied  with  the  foregoing
provisions.

SECTION 5.18.     INTERNAL REVENUE SERVICE FILING AND
                  WITHHOLDING INFORMATION.

      The Company shall file  Internal  Revenue  Service Form 8281,  Information
Return for  Publicly  Offered  Original  Issue  Discount  Instruments,  with the
Internal  Revenue  Service no later than the date such  filing is required to be
made and shall mail a copy of such filing to the  Trustee  and the Paying  Agent
within 15 days after such filing with the  Internal  Revenue  Service.  Upon the
written  request of the Paying  Agent,  the Company shall  promptly  prepare and
deliver to the Paying  Agent all  information  requested  by the Paying Agent in
order that the Paying Agent can timely  comply with the  applicable  withholding
requirements  of the Internal  Revenue  Service and prepare the applicable  Form
1099 OID for distribution to the Holders of Securities.

SECTION 5.19.     ISSUANCE AND SALE OF CAPITAL STOCK
                  OF RESTRICTED SUBSIDIARIES.

      The Company will not sell, and will not permit any Restricted  Subsidiary,
directly  or  indirectly,  to issue or sell any  shares  of  Capital  Stock of a
Restricted Subsidiary  (including options,  warrants or other rights to purchase
shares of such  Capital  Stock)  except  (i) to the  Company  or a Wholly  Owned
Restricted Subsidiary, (ii) issuances or sales to foreign nationals of shares of
Capital  Stock of foreign  Restricted  Subsidiaries,  to the extent  required by
applicable  law, (iii) if,  immediately  after giving effect to such issuance or
sale,  such  Restricted  Subsidiary  would no  longer  constitute  a  Restricted
Subsidiary or (iv) issuances or sales of Common Stock of Restricted Subsidiaries
subject to compliance  with clauses (A) or (B) of the first paragraph of Section
5.10.



                                      39


<PAGE>




SECTION 5.20.     ISSUANCES OF GUARANTEES
                  BY RESTRICTED SUBSIDIARIES.

      The  Company  will not  permit  any  Restricted  Subsidiary,  directly  or
indirectly,   to  Guarantee  any   Indebtedness  of  the  Company   ("Guaranteed
Indebtedness"),  unless (i) such Restricted Subsidiary  simultaneously  executes
and  delivers  a  supplemental  indenture  to  this  Indenture  providing  for a
Guarantee  (a  "Subsidiary  Guarantee")  of  payment of the  Securities  by such
Restricted Subsidiary and (ii) each Restricted Subsidiary waives and will not in
any manner  whatsoever  claim or take the benefit or advantage of, any rights of
reimbursement,  indemnity or subrogation or any other rights against the Company
or any other Restricted Subsidiary as a result of any payment by such Restricted
Subsidiary  under its Subsidiary  Guarantee;  PROVIDED that this paragraph shall
not be applicable to any Guarantee of any Restricted Subsidiary that (x) existed
at the time such Person became a Restricted  Subsidiary and (y) was not incurred
in connection  with, or in  contemplation  of, such Person becoming a Restricted
Subsidiary. If the Guaranteed Indebtedness is (A) PARI PASSU with the Securities
then the Guarantee of such Guaranteed  Indebtedness shall be PARI PASSU with, or
subordinated to, the Subsidiary  Guarantee or (B) subordinated to the Securities
then the Guarantee of such Guaranteed  Indebtedness shall be subordinated to the
Subsidiary Guarantees at least to the extent that the Guaranteed Indebtedness is
subordinated to the Securities.

SECTION 5.21.     INCURRENCE OF SENIOR SUBORDINATED
                  INDEBTEDNESS.

      The Company will not incur any  Indebtedness,  other than the  Securities,
that  is  expressly  made  subordinated  in  right  of  payment  to  any  Senior
Indebtedness  unless  such  Indebtedness,  by its  terms and by the terms of any
agreement or instrument  pursuant to which such  Indebtedness  is outstanding is
expressly  made PARI PASSU  with,  or  subordinate  in right of payment  to, the
Securities  pursuant to provisions  substantially  similar to those contained in
Article 10 of this Indenture;  PROVIDED,  HOWEVER, that the foregoing limitation
shall not apply to distinctions  between categories of Senior  Indebtedness that
exist by reason of any Liens or Guarantees arising or created in respect of some
but not all Senior Indebtedness.

SECTION 5.22      ACCOUNTANTS.

      In connection with the audit of the Company's financial statements for the
year ending December 31, 1997 and for all subsequent  periods for so long as any
Securities shall remain outstanding, the Company shall retain independent public
accountants  reasonably  acceptable  to the Holders of a majority  in  principal
amount of the outstanding Securities.




                                      40


<PAGE>



SECTION 5.23      INSURANCE.

      (a) The  Company  shall  maintain  key man life  insurance  on the life of
Mitchell  Rubinson  in an  amount  equal  to the  lesser  of (i)  the  aggregate
principal amount at maturity of the outstanding  Securities at any time and (ii)
the  amount  of key man life  insurance  that the  Company  could  purchase  for
$250,000 from an insurance company rated A or better by Best & Co.

      (b) The Company  shall,  and shall cause its Restricted  Subsidiaries  to,
maintain insurance by insurers of recognized  financial  responsibility  against
such risks and in such amounts as are prudent and  customary for the interest of
their respective businesses and the value of their respective properties.


                                  ARTICLE 6
                                  SUCCESSORS

SECTION 6.01.     MERGER, CONSOLIDATION, OR SALE OF ASSETS.

      The  Company  shall not  consolidate  with,  merge with or into,  or sell,
convey,  transfer, lease or otherwise dispose of all or substantially all of its
property  and  assets  (as an  entirety  or  substantially  an  entirety  in one
transaction  or a series of related  transactions)  to, any Person or permit any
Person to merge with or into the Company  unless:  (i) the Company  shall be the
continuing  Person,  or the Person (if other  than the  Company)  formed by such
consolidation  or into which the  Company is merged or that  acquired  or leased
such  property and assets of the Company  shall be a  corporation  organized and
validly  existing  under  the  laws  of the  United  States  of  America  or any
jurisdiction  thereof and shall expressly assume,  by a supplemental  indenture,
executed and delivered to the Trustee,  all of the obligations of the Company on
all of the Securities and under this Indenture;  (ii)  immediately  after giving
effect to such  transaction,  no Default or Event of Default shall have occurred
and be continuing;  (iii) immediately after giving effect to such transaction on
a pro forma basis,  the Company or any Person becoming the successor  obligor of
the Securities  shall have a Consolidated Net Worth equal to or greater than the
Consolidated  Net Worth of the Company  immediately  prior to such  transaction;
(iv)  immediately  after giving effect to such  transaction on a pro forma basis
the Company,  or any Person  becoming the successor  obligor of the  Securities,
could incur at least $1.00 of Indebtedness  under the first paragraph of Section
5.09;  PROVIDED  that  this  clause  (iv)  shall  not  apply to the  merger of a
corporation,  the sole material  asset of which  consists of Common Stock of the
Company  (and  options,  warrants or other  rights to  purchase or acquire  such
Common  Stock),  into the  Company,  if (a) the Chief  Executive  Officer of the
Company  delivers to the Trustee a certificate on behalf of the Company,  in the
form attached  hereto as Schedule III, to the effect that to his best  knowledge
there are no liabilities,  contingent or otherwise,  of such corporation and (b)
the only  consideration  received by the  stockholders  of such  corporation  in
connection  with such  merger  consists  of  Common  Stock of the  Company  (and




                                      41


<PAGE>


options, warrants other rights to purchase or acquire such Common Stock), in the
aggregate in an amount not to exceed the amount thereof held by such corporation
immediately prior to such merger; and (v) the Company delivers to the Trustee an
Officers'  Certificate  (attaching  the arithmetic  computations  to demonstrate
compliance with clauses (iii) and (iv)) and an Opinion of Counsel,  in each case
stating  that such  consolidation,  merger  or  transfer  and such  supplemental
indenture  complies  with  this  provision  and  that all  conditions  precedent
provided  for herein  relating  to such  transaction  have been  complied  with;
PROVIDED,  however,  that  clauses  (iii) and (iv) above do not apply if, in the
good  faith  determination  of the  Board of  Directors  of the  Company,  whose
determination shall be evidenced by a Board Resolution, the principal purpose of
such  transaction is to change the state of  incorporation  of the Company;  and
PROVIDED FURTHER that any such transaction shall not have as one of its purposes
the evasion of the foregoing limitations.

SECTION 6.02.     SUCCESSOR CORPORATION SUBSTITUTED.

      Upon any  consolidation  or  merger,  or any sale,  assignment,  transfer,
lease, conveyance or other disposition of all or substantially all of the assets
of the Company in accordance with Section 6.01 hereof, the successor corporation
formed by such  consolidation  or into or with which the Company is merged or to
which such sale, assignment, transfer, lease, conveyance or other disposition is
made shall succeed to, and be  substituted  for (so that from and after the date
of such consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this Indenture  referring to the "Company"  shall refer instead to
the successor corporation and not to the Company),  and may exercise every right
and power of the Company  under this  Indenture  with the same effect as if such
successor Person had been named as the Company herein;  PROVIDED,  HOWEVER, that
the  predecessor  Company shall not be relieved  from the  obligation to pay the
principal of, and premium,  if any, and interest on the Securities except in the
case of a sale of all of the  Company's  assets that meets the  requirements  of
Section 6.01 hereof.


                                   ARTICLE 7
                             DEFAULTS AND REMEDIES

SECTION 7.01.     EVENTS OF DEFAULT.

      An "Event of Default" occurs if:

            (1) the Company defaults in the payment of principal of (or premium,
      if any,  on) or interest on any of the  Securities,  when the same becomes
      due and payable at maturity,  upon acceleration,  redemption or otherwise,
      whether or not such  payment is  prohibited  by the  provisions  described
      below in Article 10;

            (2) the Company  defaults in the  performance  of any  covenant  set
      forth  in  Section  5.03,  5.04,  5.10 or  5.13  hereof,  and the  default
      continues for a period of



                                      42


<PAGE>



      15 consecutive days after written notice by the Trustee, or by the Holders
      of 25% or  more in  aggregate  principal  amount  of the  Securities  then
      outstanding;

            (3) the Company  defaults in the  performance  or breaches any other
      covenant  or  agreement  of the  Company in this  Indenture,  or under the
      Securities,  and such  default  or  breach  continues  for a period  of 30
      consecutive days after written notice by the Trustee, or by the Holders of
      25%  or  more  in  aggregate  principal  amount  of  the  Securities  then
      outstanding;

            (4) either of the New BKC Development  Agreement or the New Domino's
      Master Franchise Agreement shall be suspended or terminated;

            (5) there occurs with respect to any issue or issues of Indebtedness
      of the  Company  or  any  Significant  Subsidiary  having  an  outstanding
      principal  amount of $3 million or more in the aggregate for all issues of
      all such Persons,  whether such Indebtedness now exists or shall hereafter
      be created,  (a) an event of default that has caused the holder thereof to
      declare  such  Indebtedness  to be due and  payable  prior  to its  Stated
      Maturity and such  Indebtedness  has not been  discharged  in full or such
      acceleration  has not been  rescinded  or annulled  within 30 days of such
      acceleration  and/or (b) the failure to make any  principal  payment  with
      respect to any fixed  maturity and such  defaulted  payment shall not have
      been made, waived or extended within 30 days of such payment default;

            (6) any final  judgment or order (not covered by insurance)  for the
      payment  of money in excess of $5 million  in the  aggregate  for all such
      final  judgments  or  orders  against  all  such  Persons   (treating  any
      deductibles,  self-insurance  or  retention  as not so  covered)  shall be
      rendered  against the Company or any Significant  Subsidiary and shall not
      be paid or  discharged,  and there  shall be any period of 60  consecutive
      days  following  entry of the final  judgment  or order  that  causes  the
      aggregate  amount for all such final  judgments or orders  outstanding and
      not paid or  discharged  against  all such  Persons  to exceed $5  million
      during which a stay or  enforcement  of such final  judgment or order,  by
      reason of a pending appeal or otherwise, shall not be in effect;

            (7) a court having  jurisdiction  in the premises enters a decree or
      order for:

                  (a)  relief  in  respect  of the  Company  or any  Significant
            Subsidiary in an involuntary  case under any applicable  bankruptcy,
            insolvency or other similar law now or hereafter in effect;

                  (b)   appointment   of  a  receiver,   liquidator,   assignee,
            custodian,  trustee, sequestrator or similar official of the Company
            or any Significant  Subsidiary for all or  substantially  all of the
            property and assets of the Company or any Significant Subsidiary; or



                                      43


<PAGE>




                  (c)  the  winding  up or  liquidation  of the  affairs  of the
            Company or any Significant Subsidiary and, in each case, such decree
            or order  shall  remain  unstayed  and in effect  for a period of 60
            consecutive days.

            (8)   The Company or any Significant Subsidiary:

                  (a)   commences   a  voluntary   case  under  any   applicable
            bankruptcy,  insolvency  or other  similar law now or  hereafter  in
            effect,  or  consents  to the  entry of an order  for  relief  in an
            involuntary case under any such law;

                  (b) consents to the  appointment of or taking  possession by a
            receiver, liquidator,  assignee, custodian, trustee, sequestrator or
            similar  official of the Company or any  Significant  Subsidiary for
            all or  substantially  all of the property and assets of the Company
            or any Significant Subsidiary; or

                  (c)  effects  any  general   assignment  for  the  benefit  of
            creditors.

SECTION 7.02.     ACCELERATION.

      If an Event of  Default  (other  than an Event  of  Default  specified  in
paragraph (7) or (8) of Section 7.01 with respect to the Company)  occurs and is
continuing  under this Indenture,  the Trustee or the Holders of at least 25% in
aggregate  principal  amount of the  Securities,  then  outstanding,  by written
notice  to the  Company  (and to the  Trustee  if such  notice  is  given by the
Holders),  may and the Trustee at the request of such Holders shall, declare the
Accreted  Value of,  premium,  if any,  and  accrued  interest,  if any,  on the
Securities  to  be   immediately   due  and  payable.   Upon  a  declaration  of
acceleration,  such Accreted Value,  premium,  if any, and accrued interest,  if
any,  shall be  immediately  due and payable.  In the event of a declaration  of
acceleration  because an Event of Default  specified in paragraph (5) of Section
7.01 has occurred and is continuing,  such declaration of acceleration  shall be
automatically  rescinded  and annulled if the event of default  triggering  such
Event of Default  pursuant to paragraph (5) of Section 7.01 shall be remedied or
cured by the Company or the  relevant  Significant  Subsidiary  or waived by the
holders of the relevant  Indebtedness  within 60 days after the  declaration  of
acceleration with respect thereto. If an Event of Default specified in paragraph
(7) or (8) of Section  7.01 occurs with  respect to the  Company,  the  Accreted
Value of, premium, if any, and accrued interest,  if any, on the Securities then
outstanding  shall IPSO FACTO become and be immediately  due and payable without
any  declaration  or other act on the part of either the  Trustee or any Holder.
The  Holders  of at least a  majority  in  principal  amount of the  outstanding
Securities,  by written notice to the Company and to the Trustee,  may waive all
past  defaults  and  rescind and annul a  declaration  of  acceleration  and its
consequences if (A) all existing Events of Default, other than the nonpayment of
the  principal  of,  premium,  if any,  and  accrued  interest,  if any,  on the
Securities that have become due solely by such declaration of acceleration, have
been cured or waived and (B) the rescission would not conflict with any judgment
or decree of a court of competent jurisdiction.


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<PAGE>



SECTION 7.03.     OTHER REMEDIES.

      If an Event of Default  occurs and is  continuing,  the Trustee may pursue
any available remedy to collect the payment of principal,  and premium,  if any,
and interest on the Securities or to enforce the performance of any provision of
the Securities or this Indenture.

      The Trustee may maintain a  proceeding  even if it does not possess any of
the  Securities  or does not produce any of them in the  proceeding.  A delay or
omission by the Trustee or any Holder of a Security in  exercising  any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or  acquiescence  in the Event of Default.  All available
remedies are cumulative to the extent permitted by law.

SECTION 7.04.     WAIVER OF PAST DEFAULTS.

      Subject to Sections 7.07 and 9.02, the Holders of not less than a majority
in aggregate  principal amount of the then  outstanding  Securities by notice to
the  Trustee  may on behalf of the  Holders  of all of the  Securities  waive an
existing  Default or Event of Default and its consequences  hereunder,  except a
continuing  Default or Event of Default in the payment of the  principal  of, or
premium, if any, and interest on the Securities (the waiver of which is required
to be  unanimous),  or in respect of a covenant or a provision  which  cannot be
amended or  modified  without the  consent of all  Holders.  In the event of any
Event of Default  specified in Section 7.01(5) above,  such Event of Default and
all consequences  thereof (including,  without  limitation,  any acceleration or
resulting payment default) shall be annulled, waived and rescinded automatically
and  without  any action by the  Trustee or the  Holders of the  Securities,  if
within 60 days after such Event of Default  arose (x) the  Indebtedness  that is
the basis for such Event of Default has been discharged, (y) the holders thereof
have rescinded or waived the acceleration,  notice or action giving rise to such
Event of  Default  or (z) if the  default  that is the basis  for such  Event of
Default has been cured. 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 Event of Default or impair any right  consequent
thereon.

SECTION 7.05.     CONTROL BY MAJORITY.

      The Holders of at least a majority in  aggregate  principal  amount of the
then outstanding  Securities may direct the time, method and place of conducting
any proceeding  for any remedy  available to the Trustee or exercising any trust
or power conferred on the Trustee. However, the Trustee may refuse to follow any
direction  that  conflicts  with law or this  Indenture,  that may  involve  the
Trustee in personal liability,  or that the Trustee determines in good faith may
be unduly  prejudicial to the rights of Holders of Securities not joining in the
giving of such  direction  and may take any other action it deems proper that is
not inconsistent with any such direction received from Holders of Securities.



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<PAGE>




SECTION 7.06.     LIMITATION ON SUITS.

      A Holder may not pursue any remedy with  respect to this  Indenture or the
Securities unless:

      (1) the Holder gives to the Trustee  written notice of a continuing  Event
of Default;

      (2) the  Holders  of at least  25% in  aggregate  principal  amount of the
outstanding  Securities  make a written  request  to the  Trustee  to pursue the
remedy;

      (3) such  Holder or Holders  offer to the  Trustee  indemnity  against any
costs, liability or expense to be incurred in compliance with such request which
is reasonably satisfactory to the Trustee;

      (4) the  Trustee  does not comply  with the  request  within 60 days after
receipt of the request and the offer of satisfactory indemnity; and

      (5) during  such  60-day  period the  Holders of a majority  in  aggregate
principal  amount  of the  outstanding  Securities  do not  give the  Trustee  a
direction  which,  in the  opinion  of the  Trustee,  is  inconsistent  with the
request.

      A Holder may not use this  Indenture  to  prejudice  the rights of another
Holder or to obtain a preference or priority over such other Holder.

SECTION 7.07.     RIGHTS OF HOLDERS OF SECURITIES TO RECEIVE PAYMENT.

      Notwithstanding  any other provision of this  Indenture,  the right of any
Holder of a Security to receive  payment of principal  of, and premium,  if any,
and interest on the Security,  on or after the respective due dates expressed in
the Security  (including in connection  with an Offer to Purchase),  or to bring
suit for the enforcement of any such payment on or after such respective  dates,
shall not be impaired or affected without the consent of such Holder.

SECTION 7.08.     COLLECTION SUIT BY TRUSTEE.

      If an  Event  of  Default  specified  in  Section  7.01(1)  occurs  and is
continuing, the Trustee is authorized to recover judgment in its own name and as
trustee  of an  express  trust  against  the  Company  for the  whole  amount of
principal  of,  and  premium,  if any,  and  interest  remaining  unpaid  on the
Securities and interest on overdue principal and 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.



                                      46


<PAGE>



SECTION 7.09.     TRUSTEE MAY FILE PROOFS OF CLAIM.

      The Trustee is authorized to file such proofs of claim and 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 the
Holders  allowed in any  judicial  proceedings  relating  to the Company (or any
other obligor upon the Securities),  its creditors or its property, and shall be
entitled and empowered to participate as a member,  voting or otherwise,  of any
official committee of creditors appointed in such matter and to collect, receive
and distribute  any monies or other property  payable or deliverable on any such
claims and any custodian in any such judicial proceeding is hereby authorized by
each  Holder to make such  payments  to the  Trustee,  and in the event that the
Trustee shall consent to the making of such payments directly to the Holders, to
pay to the  Trustee  any  amount  due to it  for  the  reasonable  compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, any
other amounts due the Trustee under Section 8.07. To the extent that the payment
of any such compensation,  expenses,  disbursements and advances of the Trustee,
its agents and counsel, and any other amounts due the Trustee under Section 8.07
out of the  estate  in any such  proceeding,  shall be  denied  for any  reason,
payment of the same shall be secured by a lien on, and shall be paid out of, any
and all distributions,  dividends,  money,  securities and other properties that
the Holders may be entitled to receive in such proceeding whether in liquidation
or under any plan of reorganization or arrangement or otherwise.  Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition  affecting the Securities or the rights of any Holder,
or to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.

SECTION 7.10.     PRIORITIES.

       If the Trustee collects any money pursuant to this Article,  it shall pay
out the money in the following order:

      FIRST:  to the  Trustee,  its Agents and  attorneys  for amounts due under
Section 8.07,  including payment of all  compensation,  expenses and liabilities
incurred,  and all advances  made,  by the Trustee and the costs and expenses of
collection;

      SECOND:  if the Holders are forced to proceed against the Company directly
without the Trustee, to Holders for their collection costs;

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




                                      47


<PAGE>



      FOURTH:  to  the  Company  or  to  such  party  as a  court  of  competent
jurisdiction shall direct.

      The  Trustee  may fix a record  date and  payment  date for any payment to
Holders of Securities pursuant to this Section 7.10.

SECTION 7.11.     UNDERTAKING FOR COSTS.

      In any  suit  for the  enforcement  of any  right  or  remedy  under  this
Indenture  or in any suit against the Trustee for any action taken or omitted by
it as a Trustee,  a court in its  discretion may require the filing by any party
litigant  in the suit of an  undertaking  to pay the costs of the suit,  and the
court in its  discretion  may  assess  reasonable  costs,  including  reasonable
attorneys'  fees,  against any party litigant in the suit,  having due regard to
the merits and good faith of the claims or defenses made by the party  litigant.
This Section  does not apply to a suit by the  Trustee,  a suit by a Holder of a
Security  pursuant  to  Section  7.07,  or a suit by Holders of more than 10% in
principal amount of the then outstanding Securities.


                                   ARTICLE 8
                                    TRUSTEE

SECTION 8.01.     DUTIES OF TRUSTEE.

      (a) If an Event of Default  actually known to 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 its
exercise   thereof  as  a  prudent  person  would  exercise  or  use  under  the
circumstances  in the  conduct  of  his or her  own  affairs.  Subject  to  such
provisions,  the Trustee  will be under no  obligation  to  exercise  any of its
rights or powers  under this  Indenture  at the request of any of the Holders of
the  Securities,  unless  they shall have  offered to the Trustee  security  and
indemnity satisfactory to it against any loss, liability or expense.

      (b) Except during the continuance of an Event of Default actually known to
the Trustee:

            (1) The Trustee and the Agents need perform only those duties as are
      specifically  set  forth  in  this  Indenture  and no  duties,  covenants,
      responsibilities  or  obligations  shall be implied in this Indenture that
      are adverse to the Trustee or the Agents.

            (2) In the  absence  of bad faith on its part,  the  Trustee  or any
      Agent may  conclusively  rely, as to the truth of the  statements  and the
      correctness  of  the  opinions   expressed   therein,   upon  certificates
      (including  Officers'  Certificates)  or opinions  (including  Opinions of
      Counsel)  furnished  to the  Trustee  or any Agent and  conforming  to the
      requirements  of  this  Indenture.  However,  as to  any  certificates  or
      opinions  which are  required by any  provision  of this  Indenture  to be



                                      48


<PAGE>


      delivered  or provided  to the  Trustee or any Agent,  the Trustee or such
      Agent shall examine the certificates and opinions to determine  whether or
      not they conform to the requirements of this Indenture,  but not to verify
      the contents thereof.

      (c) Notwithstanding anything to the contrary herein contained, the Trustee
may  not be  relieved  from  liability  for its own  negligent  action,  its own
negligent failure to act, or its own willful misconduct, except that:

            (1) This  paragraph  does not limit the effect of  paragraph  (b) of
      this Section 8.01.

            (2)  Neither the Trustee nor any Agent shall be liable for any error
      of  judgment  made in good faith by a Trust  Officer (or an officer of the
      Agent),  unless it is proved that the Trustee or such Agent was  negligent
      in ascertaining the pertinent facts.

            (3) The Trustee  shall not be liable  with  respect to any action it
      takes or  omits  to take in good  faith  in  accordance  with a  direction
      received by it pursuant to Section 7.02, 7.04 or 7.05.

      (d) No provision of this Indenture  shall require the Trustee or any Agent
to expend or risk its own funds or otherwise  incur any  financial  liability in
the  performance  of any of its duties  hereunder or to take or omit to take any
action  under this  Indenture  or take any action at the request or direction of
Holders if it shall have reasonable grounds for believing that repayment of such
funds is not assured to it or it does not receive an indemnity  satisfactory  to
it in its sole  discretion  against such risk,  liability,  loss, fee or expense
which might be incurred by it in compliance with such request or direction.

      (e) Every  provision  of this  Indenture  that in any way  relates  to the
Trustee or any Agent is  subject to  paragraphs  (a),  (b),  (c) and (d) of this
Section 8.01.

      (f) Neither the Trustee nor any Agent shall be liable for  interest on any
money or assets received by it except as the Trustee or any such Agent may agree
in writing  with the  Company.  Assets held in trust by the Trustee or any Agent
need not be segregated from other assets except to the extent required by law.

      (g) The Trustee shall not be responsible  for the application of any money
by any Paying Agent other than the Trustee.

      (h) Any 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 8.01.




                                      49


<PAGE>



      (i) The Trustee shall receive and retain financial  reports and statements
of the  Company  as  provided  herein,  but it shall  have no duty to  review or
analyze such reports or statements  to determine  compliance  with  covenants or
other obligations of the Company.

      (j) Neither the Trustee nor any Agent shall be liable for  interest on any
money  received  by it except as the  Trustee  or any Agent may agree in writing
with the  Company.  Money held in trust by the  Trustee or any Agent need not be
segregated from other funds except to the extent required by law.

SECTION 8.02.     RIGHTS OF TRUSTEE AND EACH AGENT.

      Subject to Section 8.01:

      (a) The Trustee and each Agent may request and rely conclusively and shall
be fully  protected  in acting  or  refraining  from  acting  upon any  document
believed by it to be genuine and to have been signed or  presented by the proper
Person.  Neither the Trustee nor any Agent need  investigate  any fact or matter
stated in the document.

      (b) Before the Trustee or any Agent acts or refrains  from acting,  it may
consult with counsel and may require an Officers'  Certificate  or an Opinion of
Counsel,  which shall conform to Sections  12.02 and 12.03.  Neither the Trustee
nor any Agent shall be liable for and shall be fully protected in respect of any
action it takes or omits to take in good  faith in  reliance  on such  Officers'
Certificate or Opinion of Counsel.

      (c) The Trustee and any Agent may act through  their  attorneys and Agents
and shall not be  responsible  for the  misconduct  or  negligence  of any Agent
(other  than an Agent  who is an  employee  of the  Trustee  or such  Agent)  or
attorney appointed with due care.

      (d)  Neither the Trustee nor any Agent shall be liable for any action that
it takes  or omits to take in good  faith  which it  reasonably  believes  to be
authorized or within its rights or powers conferred upon it by this Indenture.

      (e)  Neither  the  Trustee  nor any  Agent  shall  be  bound  to make  any
investigation  into the facts or matters stated in any  resolution,  certificate
(including any Officers' Certificate), statement, instrument, opinion (including
any Opinion of Counsel),  notice,  request,  direction,  consent,  order,  bond,
debenture,  or other paper or  document,  but the Trustee or an Agent,  in their
discretion,  may make such further inquiry or  investigation  into such facts or
matters as they may see fit and, if the Trustee or any Agent shall  determine to
make such  further  inquiry  or  investigation,  they  shall be  entitled,  upon
reasonable notice to the Company, to examine the books, records, and premises of
the Company, personally or by agent or attorney.

      (f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this  Indenture at the request,  order or direction of




                                      50


<PAGE>


any of the  Holders  of the  Securities  pursuant  to  the  provisions  of  this
Indenture,  unless such  Holders  shall have  offered to the Trustee  reasonable
security or indemnity  against the costs,  expenses and liabilities which may be
incurred by it in compliance with such request, order or direction.

      (g) The Trustee or any Agent may consult  with  counsel of its  selection,
and the advice or opinion of counsel with respect to legal  matters  relating to
this Indenture and the Securities shall be full and complete  authorization  and
protection from liability with respect to any action taken,  omitted or suffered
by it  hereunder in good faith and in  accordance  with the advice or opinion of
such counsel.

SECTION 8.03.     INDIVIDUAL RIGHTS OF TRUSTEE.

      The Trustee in its  individual or any other  capacity may become the owner
or pledgee of Securities and may otherwise deal with the Company, any Subsidiary
of the Company,  or their respective  Affiliates,  with the same rights it would
have if it were not  Trustee.  Any  Agent  may do the  same  with  like  rights.
However, in the event that the Trustee acquires any conflicting interest it must
eliminate such conflict  within 90 days or resign.  The Trustee must comply with
Sections 8.10 and 8.11.

SECTION 8.04.     DISCLAIMER OF TRUSTEE AND AGENTS.

      Neither  the  Trustee  nor any Agent  makes any  representation  as to the
validity,  effectiveness or adequacy of this Indenture or the Securities, and it
shall  not be  accountable  for  the  Company's  use of the  proceeds  from  the
Securities  or any money  paid to the  Company  or upon the  Company or upon the
Company's direction under any provision of this Indenture. The Trustee shall not
be  responsible  for the use or  application of any money received by any Paying
Agent other than the Trustee,  and it shall not be responsible for any statement
or recital of the Company in this  Indenture or the  Securities  or any document
issued in connection with the sale of the Securities.

SECTION 8.05.     NOTICE OF DEFAULT.

      If a Default or an Event of Default  occurs and is continuing and if it is
actually known to the Trustee,  the Trustee shall mail to each Holder,  as their
names and addresses appear on the Holder list described in Section 2.05,  notice
of the  uncured  Default  or Event of Default  within 90 days after the  Trustee
receives such notice.  Except in the case of a Default or an Event of Default in
payment of principal of, or premium on, or interest on any  Security,  including
an  accelerated  payment  and the failure to make  payment on the  Payment  Date
pursuant to an Offer to Purchase,  and except in the case of a failure to comply
with  Article 6, the Trustee may withhold the notice if and so long as its Board
of Directors,  the executive  committee of its Board of Directors or a committee
of its directors and/or Trust Officers in good faith determines that withholding
the notice is in the interest of the Holders. The Trustee shall not be deemed to
have  knowledge  of a Default  or Event of  Default  other than (i) any Event of




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<PAGE>


Default occurring  pursuant to Section 7.01(1);  or (ii) any Default or Event of
Default of which a Trust  Officer shall have received  written  notification  or
obtained actual knowledge.

SECTION 8.06.     REPORTS BY TRUSTEE TO HOLDERS.

      Within 60 days after April 15 of each year  beginning with April 15, 1998,
the Trustee  shall,  to the extent that any of the events  described  in TIA ss.
313(a) occurred within the previous  twelve months,  but not otherwise,  mail to
each  Holder a brief  report  dated as of such date that  complies  with TIA ss.
313(a). The Trustee also shall comply with TIA ss.ss. 313(b) and 313(c).

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

      The Company shall  promptly  notify the Trustee if the  Securities  become
listed on any stock exchange and the Trustee shall comply with TIA ss. 313(d).

SECTION 8.07.     COMPENSATION AND INDEMNITY.

      The Company  shall pay to the  Trustee and any Agent in their  capacity as
such from time to time such compensation as may be agreed upon in writing by the
Company  and  the  Trustee  or  such  Agent.   The  Trustee's  and  the  Agents'
compensation  shall not be limited by any law on compensation of a trustee of an
express  trust.  The  Company  shall  reimburse  the  Trustee and any Agent upon
request for all reasonable  out-of-pocket  expenses,  disbursements and advances
incurred or made by them in connection  with the performance of their duties and
the discharge of their  obligations  under this  Indenture.  Such expenses shall
include the reasonable fees and expenses of the Trustee's and Agents' agents and
counsel.

      The Company  shall  indemnify the Trustee and the Agents and their agents,
employees,  officers,  stockholders  and  directors  for, and hold them harmless
against, any loss, liability, damage, claim or expense incurred by them, arising
out of or in  connection  with the  acceptance or  administration  of this trust
including the reasonable costs and expenses of defending  themselves against any
claim or liability in  connection  with the  exercise or  performance  of any of
their  rights,  powers or duties  hereunder.  The Trustee  and the Agents  shall
notify the  Company  promptly of any claim  asserted  against the Trustee or any
Agent for which indemnity may be sought; PROVIDED,  HOWEVER, that the failure to
provide such notice shall not affect the right to indemnity provided for herein.
The  Company  shall  defend  the  claim and the  Trustee  and the  Agents  shall
cooperate in the defense.  The Trustee and the Agents may have separate  counsel
and the Company shall pay the reasonable fees and expenses of such counsel.  The
Company need not pay for any settlement made without its written consent,  which
consent shall not be unreasonably withheld.





                                      52


<PAGE>



      To secure the Company's  payment  obligations  in this Section  8.07,  the
Trustee and the Agents shall have a lien prior to the  Securities  on all assets
or money held or collected by the Trustee and the Agents,  in their  capacity as
Trustee or Agent,  as the case may be,  except  assets or money held in trust to
pay principal of, or premium on, if any, and interest on particular Securities.

      When the Trustee or an Agent incurs expenses or renders  services after an
Event of Default  specified  in Section  7.01(7) or (8)  occurs,  such  expenses
(including the  reasonable  fees and expenses of its agents and counsel) and the
compensation for such services shall be preferred over the status of the Holders
in a proceeding under Bankruptcy Law and are intended to constitute  expenses of
administration  under any Bankruptcy Law. The Company's  obligations  under this
Section 8.07 and any claim arising  hereunder  shall survive the  resignation or
removal of any Trustee or Agent.

SECTION 8.08.     REPLACEMENT OF TRUSTEE.

      The Trustee may resign at any time by so notifying  the Company in writing
at least 10 days in advance of such  resignation.  The  Holders of a majority in
principal amount of the then outstanding Securities may remove the Trustee by so
notifying  the Company and the Trustee and may appoint a successor  trustee with
the Company's  consent.  A resignation or removal of the Trustee and appointment
of a successor Trustee shall become effective only upon the successor  Trustee's
acceptance of  appointment  as provided in this Section.  The Company may remove
the Trustee if:

      (a)   the Trustee fails to comply with Section 8.10;

      (b) the Trustee is adjudged  bankrupt or  insolvent or an order for relief
is entered with respect to the Trustee under any Bankruptcy Law;

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

      (d) the Trustee becomes incapable of acting.

      If the Trustee  resigns or is removed or if a vacancy exists in the office
of Trustee for any reason,  the Company  shall  notify each Holder of such event
and shall  promptly  appoint a  successor  Trustee.  Within  one year  after the
successor Trustee takes office, the Holders of a majority in principal amount of
the Securities may, with the Company's  consent,  appoint a successor Trustee to
replace the successor Trustee appointed by the Company.

      A successor Trustee shall deliver a written  acceptance of its appointment
to the retiring  Trustee and to the Company.  Promptly  after that, the retiring
Trustee  shall  transfer,  after  payment of all sums then owing to the  Trustee
pursuant to Section  8.07,  all property  held by it as Trustee to the successor




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<PAGE>


Trustee,  subject to the lien  provided  in Section  8.07,  the  resignation  or
removal of the  retiring  Trustee  shall  become  effective,  and the  successor
Trustee  shall have all the rights,  powers and duties of the Trustee under this
Indenture.  A  successor  Trustee  shall mail notice of its  succession  to each
Holder.

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

      If the Trustee after written request by a Holder who has been a Holder for
at least six months  fails to comply with Section  8.10,  any Holder may (at its
expense)  petition  any court of competent  jurisdiction  for the removal of the
Trustee and the appointment of a successor Trustee.

      Notwithstanding  replacement of the Trustee pursuant to this Section 8.08,
the Company's  obligations  under Section 8.07 shall continue for the benefit of
the retiring Trustee.

SECTION 8.09.     SUCCESSOR TRUSTEE BY MERGER, ETC.

      If the Trustee  consolidates  with,  merges or converts into, or transfers
all or substantially all of its corporate trust business to, another Person, the
resulting, surviving or transferee Person without any further act shall, if such
resulting,  surviving or transferee Person is otherwise eligible  hereunder,  be
the successor  Trustee;  PROVIDED that such Person shall be otherwise  qualified
and eligible under this Article 8.

SECTION 8.10.     ELIGIBILITY; DISQUALIFICATION.

      This Indenture  shall always have a Trustee who satisfies the  requirement
of TIA  ss.ss.  310(a)(1)  and  310(a)(5).  The  Trustee  (or in the  case  of a
corporation  included in a bank holding company system, the related bank holding
company) shall have a combined  capital and surplus of at least  $100,000,000 as
set forth in its most recent published annual report of condition.  In addition,
if the Trustee is a corporation  included in a bank holding company system,  the
Trustee,  independently  of such bank  holding  company,  shall meet the capital
requirements of TIA ss. 310(a)(2). The Trustee shall comply with TIA ss. 310(b);
PROVIDED,  HOWEVER,  that there shall be excluded  from the operation of TIA ss.
310(b)(1)  any  indenture  or  indentures  under  which  other  securities,   or
certificates of interest or  participation in other  securities,  of the Company
are  outstanding,  if the  requirements  for such exclusion set forth in TIA ss.
310(b)(1) are met. The  provisions of TIA ss. 310 shall apply to the Company and
any other obligor of the Securities.

SECTION 8.11.     PREFERENTIAL COLLECTION OF
                  CLAIMS AGAINST THE COMPANY.

      The Trustee  shall  comply with TIA ss.  311(a),  excluding  any  creditor
relationship  listed in TIA ss.  311(b).  A  Trustee  who has  resigned  or been




                                      54


<PAGE>


removed shall be subject to TIA ss. 311(a) to the extent indicated therein.  The
provisions  of TIA ss. 311 shall apply to the  Company and any other  obligor of
the Securities.

SECTION 8.12.     AUTHENTICATING AGENTS.

      (a) The Trustee may appoint one or more Authenticating  Agents which shall
be  authorized  to act on behalf of the  Trustee in  authenticating  Securities.
Wherever reference is made in this Indenture to the authentication of Securities
by the Trustee or the Trustee's  certificate of  authentication,  such reference
shall be deemed  to  include  authentication  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 must be
acceptable  to the Company and must be a  corporation  or financial  institution
organized and doing  business  under the laws of the United States of America or
of any state and having a principal  office and place of business in the Borough
of  Manhattan,  the City and State of New York,  having a combined  capital  and
surplus of at least $15,000,000, authorized under such laws to engage in a trust
business  and  subject  to  supervision  or  examination  by  federal  or  state
authorities.   The  Trustee  hereby   appoints   Bankers  Trust  Company  as  an
Authenticating  Agent  hereunder and Bankers Trust Company  hereby  accepts such
appointment.

      (b) Any  Person  into  which  any  Authenticating  Agent  may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which any Authenticating Agent shall be a
party,  or  any  Person  succeeding  to the  corporate  agency  business  of any
Authenticating  Agent, shall continue to be the Authenticating Agent without the
execution  or filing of any paper or any  further act on the part of the Trustee
or the  Authenticating  Agent;  PROVIDED such Person shall be otherwise eligible
under this Article 8.

      (c) Any Authenticating  Agent may at any time resign by giving at least 30
days' advance written notice of resignation to the Trustee and the Company.  The
Trustee  may at any time  terminate  the agency of any  Authenticating  Agent by
giving  written  notice  of  termination  to such  Authenticating  Agent and the
Company.  Upon receiving a notice of resignation or upon such a termination,  or
in case at any time any  Authenticating  Agent  shall  cease to be  eligible  in
accordance  with the  provisions of this Section 8.12, the Trustee may appoint a
successor Authenticating Agent, shall give written notice of such appointment to
the Company and shall mail notice of such appointment (at the Company's expense)
to all  Holders.  Any  successor  Authenticating  Agent upon  acceptance  of its
appointment  hereunder shall become vested with all the rights,  powers,  duties
and  responsibilities  of its  predecessor  hereunder,  with  like  effect as if
originally named as Authenticating  Agent. No such Authenticating Agent shall be
appointed  unless  eligible  under the  provisions  of this  Section  8.12.  Any
Authenticating  Agent  shall be  entitled  to  reasonable  compensation  for its
services which shall be paid by the Company.






                                      55


<PAGE>



                                   ARTICLE 9
                       AMENDMENT, SUPPLEMENT AND WAIVER

SECTION 9.01.     WITHOUT CONSENT OF HOLDERS.

      Notwithstanding  Section  9.02  of  this  Indenture,   the  Company,  when
authorized  by a Board  Resolution,  and the  Trustee  together,  may  amend  or
supplement this Indenture or the Securities  without notice to or consent of any
Holder:

      (1) to cure any  ambiguity,  defect or  inconsistency;  PROVIDED that such
amendment  or  supplement  does not,  in the opinion of the  Trustee,  adversely
affect the rights of any of the Holders in any material respect;

       (2) to provide for the assumption of the Company's obligations to Holders
of the  Securities  in the  event of a merger,  consolidation  or sale of all or
substantially all of the Company's assets pursuant to Article 6 hereof;

      (3) to make any  change  that  would  provide  any  additional  rights  or
benefits to the Holders of the Securities or that does not adversely  affect the
legal rights under this Indenture of any such Holder; and

      (4) to evidence and provide for the acceptance of appointment hereunder by
a successor Trustee;

PROVIDED that the Company has delivered to the Trustee an Opinion of Counsel and
an  Officers'  Certificate,  each  stating  that such  amendment  or  supplement
complies with the provisions of this Section 9.01.

SECTION 9.02.     WITH CONSENT OF HOLDERS.

      Subject  to  Section  7.07,  the  Company,  when  authorized  by  a  Board
Resolution and the Trustee, with the written consent of the Holder or Holders of
at least a majority in principal amount of the outstanding  Securities may amend
or supplement  this  Indenture or the  Securities,  without  notice to any other
Holders.  Subject to Sections 7.04 and 7.07, the Holder or Holders of a majority
in aggregate principal amount of the outstanding Securities may waive compliance
by the Company with any provision of this  Indenture or the  Securities  without
notice to any other Holders.

      No amendment, supplement or waiver, including a waiver pursuant to Section
7.04, shall, directly or indirectly,  without the consent of each Holder of each
Security affected thereby:

      (1) change the Stated  Maturity of the principal of, or any installment of
interest on, any Security or reduce the principal amount of, or premium, if any,
or interest on, any Security;



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<PAGE>



      (2) change the currency of payment of principal of, or premium, if any, or
interest on, any Security;

      (3) impair the right to institute suit for the  enforcement of any payment
on or after the Stated  Maturity (or, in the case of a  redemption,  on or after
the Redemption Date) of any Security;

      (4) reduce the  percentage of  outstanding  Securities  whose Holders must
consent to an amendment or supplement to this Indenture;

      (5) waive a Default or Event of Default in the payment of principal of, or
premium, if any, or interest on the Securities;

      (6) reduce the  percentage or aggregate  principal  amount of  outstanding
Securities,  the consent of whose  Holders is necessary for waiver of compliance
with certain provisions of this Indenture or for waiver of certain Defaults;

      (7)   reduce the rate of accretion on any Security; or

      (8) make any change in the foregoing amendment and waiver provisions.

      It shall not be  necessary  for the  consent  of the  Holders  under  this
Section  9.02  to  approve  the  particular  form  of  any  proposed  amendment,
supplement or waiver,  but it shall be  sufficient if such consent  approves the
substance thereof.

      After an  amendment,  supplement or waiver under this Section 9.02 becomes
effective (as provided in Section  9.03),  the Company shall mail to the Holders
affected  thereby a notice  briefly  describing  the  amendment,  supplement  or
waiver.

 SECTION 9.03.    REVOCATION AND EFFECT OF CONSENTS.

      Until an amendment,  waiver or supplement becomes effective,  a consent to
it by a Holder is a continuing consent by the Holder and every subsequent Holder
of a  Security  or portion of a  Security  that  evidences  the same debt as the
consenting Holder's Security, even if notation of the consent is not made on any
Security.  Subject to the  following  paragraph,  any such Holder or  subsequent
Holder may revoke the consent as to his  Security or portion of his  Security by
notice to the  Trustee  or the  Company  received  before  the date on which the
Trustee  receives an Officers'  Certificate  certifying  that the Holders of the
requisite  principal  amount of Securities  have consented (and not  theretofore
revoked such consent) to the amendment, supplement or waiver (at which time such
amendment, supplement or waiver shall become effective).

      The Company may, but shall not be obligated  to, fix a record date for the
purpose of  determining  the  Holders  entitled  to  consent  to any  amendment,




                                      57


<PAGE>


supplement  or waiver,  which record date shall be at least 30 days prior to the
first   solicitation  of  such  consent.   If  a  record  date  is  fixed,  then
notwithstanding the last sentence of the immediately preceding paragraph,  those
Persons who were Holders at such record date (or their duly designated proxies),
and only those  Persons,  shall be  entitled  to revoke any  consent  previously
given,  whether or not such  Persons  continue  to be Holders  after such record
date.  No such consent  shall be valid or effective for more than 120 days after
such record date.

      After an amendment,  supplement or waiver becomes effective, it shall bind
every Holder,  unless it makes a change  described in any of clauses (1) through
(8) of Section 9.02, in which case,  the  amendment,  supplement or waiver shall
bind only each Holder of a Security who has consented to it and every subsequent
Holder of a Security or portion of a Security  that  evidences  the same debt as
the consenting Holder's Security; PROVIDED that any such waiver shall not impair
or affect the right of any Holder to receive payment of principal of, or premium
on, or interest on a Security on or after the respective due dates  expressed in
such  Security,  or to bring suit for the  enforcement of any such payment on or
after such respective dates without the consent of such Holder.

SECTION 9.04.     NOTATION ON OR EXCHANGE OF SECURITIES.

      If an amendment, supplement or waiver changes the terms of a Security, the
Trustee may require the Holder of the Security to deliver it to the Trustee. The
Trustee  may place an  appropriate  notation on the  Security  about the changed
terms and return it to the Holder. Alternatively,  if the Company or the Trustee
so  determine,  the Company in  exchange  for the  Security  shall issue and the
Trustee  shall  authenticate  a new Security  that  reflects the changed  terms.
Failure  to make the  appropriate  notation  or issue a new  Security  shall not
affect the validity and effect of such amendment, supplement or waiver.

SECTION 9.05.     TRUSTEE TO SIGN AMENDMENTS, ETC.

      The Trustee shall execute any amendment,  supplement or waiver  authorized
pursuant to and adopted in  accordance  with this Article 9;  PROVIDED  that the
Trustee  may,  but  shall  not be  obligated  to,  execute  any such  amendment,
supplement  or  waiver  which  affects  the  Trustee's  own  rights,  duties  or
immunities under this Indenture.  The Trustee shall be entitled to receive,  and
shall be fully protected in relying upon, an Opinion of Counsel and an Officers'
Certificate  each stating that the  execution of any  amendment,  supplement  or
waiver authorized  pursuant to this Article 9 is authorized or permitted by this
Indenture. Such Opinion of Counsel shall not be an expense of the Trustee.






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<PAGE>



                                  ARTICLE 10
                                 SUBORDINATION

SECTION 10.01.    SECURITIES SUBORDINATE TO SENIOR INDEBTEDNESS.

      The Company and the Trustee each covenants and agrees, and each Holder, by
its acceptance of a Security, likewise covenants and agrees, that all Securities
shall be  issued  subject  to the  subordination  provisions  contained  in this
Article 10, and each Holder of a Security,  whether upon original  issue or upon
transfer,  assignment  or exchange  thereof,  accepts and agrees that the Senior
Subordinated  Obligations shall be, to the extent and in the manner set forth in
this  Article  10,  subordinated  in right of payment  and  subject to the prior
payment in full,  in cash or cash  equivalents,  of all  amounts  payable  under
Senior  Indebtedness  including,   without  limitation,  any  interest  accruing
subsequent to an event specified in Sections 7.01(7) and 7.01(8), whether or not
such  interest is an allowed  claim  enforceable  against  the debtor  under the
Bankruptcy Code.

SECTION 10.02.    NO PAYMENT ON SECURITIES IN CERTAIN CIRCUMSTANCES.

      (a) No direct or  indirect  payment by or on behalf of the  Company of any
Senior Subordinated Obligations, whether pursuant to the terms of the Securities
or upon  acceleration  or  otherwise,  shall  be made  if,  at the  time of such
payment,  there  exists a default in the  payment  of all or any  portion of the
obligations  on any Senior  Indebtedness,  and such default  shall not have been
cured or waived, or the benefits of this sentence waived by or on behalf of, the
holders of such Senior Indebtedness.

      (b) In addition, during the continuance of any other event of default with
respect to any Senior Indebtedness pursuant to which the maturity thereof may be
accelerated,  upon receipt by the Trustee of written  notice from the trustee or
other representative for the holders of such Senior Indebtedness (or the holders
of at least a majority  in  principal  amount of such Senior  Indebtedness  then
outstanding), no payment of Senior Subordinated Obligations may be made by or on
behalf of the  Company  upon or in  respect  of the  Securities  for a period (a
"Payment Blockage Period")  commencing on the date of receipt of such notice and
ending 179 days thereafter  (unless,  in each case, such Payment Blockage Period
shall be  terminated  by written  notice to the Trustee from such trustee of, or
other  representatives  for,  such  holders or if the  Company  delivers  to the
Trustee an Officers'  Certificate  certifying  that (i) the Senior  Indebtedness
that gave rise to such Payment  Blockage  Period has been repaid in full or (ii)
the event of default that gave rise to such Payment Blockage Period is no longer
continuing).  Not more than one Payment  Blockage  Period may be commenced  with
respect  to  the  Securities   during  any  period  of  360  consecutive   days.
Notwithstanding  anything in this  Indenture to the contrary,  there must be 180
consecutive days in any 360-day period in which no Payment Blockage Period is in
effect.   No  event  of  default  that  existed  or  was  continuing  (it  being
acknowledged  that any  subsequent  action  that  would give rise to an event of
default  pursuant to any  provision  under which an event of default  previously




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<PAGE>


existed or was  continuing  shall  constitute  a new event of  default  for this
purpose) on the date of the  commencement  of any Payment  Blockage  Period with
respect to the Senior Indebtedness initiating such Payment Blockage Period shall
be,  or  shall be made,  the  basis  for the  commencement  of a second  Payment
Blockage  Period by the  representative  for,  or the  holders  of,  such Senior
Indebtedness,  whether or not within a period of 360  consecutive  days,  unless
such event of  default  shall have been cured or waived for a period of not less
than 90 consecutive days.

      (c) In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee or any Holder and the Trustee is aware that such payment
is prohibited by paragraphs (a) and (b) of this Section 10.02, the Trustee shall
promptly  notify  the  holders  of the Senior  Indebtedness  of such  prohibited
payment  and such  payment  shall be held for the  benefit of, and shall be paid
over or delivered  to, the holders of Senior  Indebtedness  or their  respective
representatives,  or to the trustee or trustees under any indenture  pursuant to
which any of such Senior  Indebtedness may have been issued, as their respective
interests may appear,  but only to the extent that, upon notice from the Trustee
to the  holders of Senior  Indebtedness  that such  prohibited  payment has been
made,  the  holders  of the  Senior  Indebtedness  (or their  representative  or
representatives  or a trustee) within 30 days of receipt of such notice from the
Trustee,  notify  the  Trustee of the  amounts  then due and owing on the Senior
Indebtedness,  if any,  and only the  amounts  specified  in such  notice to the
Trustee shall be paid to the holders of Senior Indebtedness and any excess above
such amounts due and owing on Senior Indebtedness shall be paid to the Company.

SECTION 10.03.    PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.

      (a) Upon any  payment  or  distribution  of  assets or  securities  of the
Company of any kind or character,  whether in cash, property or securities, upon
any dissolution or winding up or total or partial  liquidation or reorganization
of the Company,  whether voluntary or involuntary or in bankruptcy,  insolvency,
receivership  or other  proceedings,  all  amounts due or to become due upon all
Senior  Indebtedness  (including any interest accruing subsequent to an event of
bankruptcy, whether or not such interest is an allowed claim enforceable against
the debtor under the  Bankruptcy  Code) shall first be paid in full,  in cash or
cash equivalents,  before the Holders of the Securities or the Trustee on behalf
of the Holders of the Securities shall be entitled to receive any payment by the
Company on account of Senior Subordinated Obligations, or any payment to acquire
any of the Securities for cash, property or securities, or any distribution with
respect to the Securities of any cash, property or securities.

      (b) In the event that, notwithstanding the foregoing provision prohibiting
such  payment or  distribution,  any  payment or  distribution  of assets of the
Company of any kind or character, whether in cash, property or securities, shall
be  received  by the  Trustee  or any  Holder  at a time when  such  payment  or
distribution  is prohibited by Section  10.03(a) and before all  obligations  in
respect of Senior  Indebtedness  are paid in full, in cash or cash  equivalents,
such payment or distribution  shall be received and held for the benefit of, and
shall be paid over or delivered to, the holders of Senior Indebtedness (PRO RATA




                                      60


<PAGE>


to such  holders on the basis of the  respective  amount of Senior  Indebtedness
held by such  holders)  or their  representatives  or to the trustee or trustees
under any other  indenture  pursuant to which any such Senior  Indebtedness  may
have been issued, as their respective  interests appear,  for application to the
payment  of  Senior   Indebtedness   remaining  unpaid  until  all  such  Senior
Indebtedness  has been paid in full, in cash or cash  equivalents,  after giving
effect to any concurrent  payment,  distribution or provision therefor to or for
the holders of such Senior Indebtedness.

      (c) The  consolidation  of the Company  with, or the merger of the Company
with or into,  another  corporation  or the  liquidation  or  dissolution of the
Company following the sale, conveyance,  transfer, lease or other disposition of
all or substantially all of its property and assets to another  corporation upon
the  terms  and  conditions  provided  in  Article  6  shall  not  be  deemed  a
dissolution,  winding up, liquidation or reorganization for the purposes of this
Section 10.03 if such other corporation shall, as a part of such  consolidation,
merger, sale, conveyance,  transfer, lease or other disposition, comply with the
conditions provided in Article 6.

SECTION 10.04.    SUBROGATION OF HOLDERS TO RIGHTS OF HOLDERS OF SENIOR
                  INDEBTEDNESS.

      Upon  the  payment  in full  of all  Senior  Indebtedness  in cash or cash
equivalents,  the Holders of Securities shall be subrogated to the rights of the
holders of Senior  Indebtedness to receive  payments or  distributions  of cash,
property or securities of the Company made on such Senior Indebtedness until the
principal of, premium,  if any, and interest on the Securities  shall be paid in
full, and no payments or distributions to the holders of Senior Indebtedness (or
any trustee  therefor)  of any cash,  property or  securities  of the Company to
which the Holders or the Trustee on their  behalf  would be entitled  except for
the provisions of this Article 10, and no payment  pursuant to the provisions of
this Article 10 to the holders of Senior  Indebtedness by Holders or the Trustee
on their behalf shall be, as among the Trustee, the Company, its creditors other
than the holders of Senior Indebtedness, and the Holders, deemed to be a payment
by the Company to or on account of the Senior Indebtedness,  it being understood
that the  provisions  of this  Article  10 are and are  intended  solely for the
purpose of defining the relative  rights of, the Holders,  on the one hand,  and
the holders of the Senior Indebtedness, on the other hand.

      If any payment or  distribution  to which the Holders would otherwise have
been entitled but for the provisions of this Article 10 shall have been applied,
pursuant  to the  provisions  of this  Article 10, to the payment of all amounts
payable under Senior Indebtedness,  then, and in such case, the Holders shall be
entitled to receive from the holders of such Senior Indebtedness any payments or
distributions  received by such holders of Senior  Indebtedness in excess of the
amount  required to make payment in full, in cash or cash  equivalents,  of such
Senior Indebtedness of such holders.





                                      61


<PAGE>



SECTION 10.05.    OBLIGATIONS OF COMPANY UNCONDITIONAL.

      Nothing  contained in this Article 10 or elsewhere in this Indenture or in
the  Securities  is  intended  to or shall  impair,  as among the  Company,  its
creditors other than the holders of Senior  Indebtedness,  and the Holders,  the
obligation of the Company,  which is unconditional  and absolute,  to pay to the
Holders the principal of, premium, if any, and interest on the Securities as and
when the same shall become due and payable in accordance with their terms, or to
affect the relative  rights of the Holders and  creditors  of the Company  other
than the  holders  of the  Senior  Indebtedness,  nor shall  anything  herein or
therein  prevent  the  Trustee  or any  Holders  from  exercising  all  remedies
otherwise  permitted  by  applicable  law upon a Default  or an Event of Default
under this Indenture,  subject to the rights,  if any, under this Article 10, of
the holders of Senior Indebtedness in respect of cash, property or securities of
the Company received upon the exercise of any such remedy.

      Without  limiting the  generality of the foregoing,  nothing  contained in
this  Article 10 will  restrict  the right of the Trustee or the Holders to take
any action to declare the Securities to be due and payable prior to their Stated
Maturity pursuant to Section 7.01 or to pursue any rights or remedies hereunder;
PROVIDED,  HOWEVER,  that  all  Senior  Indebtedness  then  due and  payable  or
thereafter  declared to be due and payable  shall first be paid in full, in cash
or cash  equivalents,  before the Holders or the Trustee are entitled to receive
any  direct  or  indirect  payment  from  the  Company  of  Senior  Subordinated
Obligations.


SECTION 10.06.    PAYMENTS MAY BE MADE PRIOR TO DISSOLUTION.

      Nothing  contained in this Article 10 or elsewhere in this Indenture or in
any of the  Securities  (a) shall prevent the Company at any time,  except under
the conditions  described in Section 10.02 or 10.03,  from making payments of or
on  account of the  Senior  Subordinated  Obligations  to the  Holders  entitled
thereto or from depositing any moneys with the Trustee for such payments, or (b)
shall prevent the application by the Trustee (or any Paying Agent other than the
Company)  of any moneys  deposited  with it  hereunder  to the  payment of or on
account of the Senior  Subordinated  Obligations,  if the Trustee or such Paying
Agent, as the case may be, did not, at least two Business Days prior to the date
upon which such payment becomes due and payable, have written notice as provided
in Section 10.02 or 10.12 of any event  prohibiting  the making of such payment.
The Company shall give prompt written notice to the Trustee of any  dissolution,
winding up, liquidation or reorganization of the Company.

SECTION 10.07.    NO WAIVER OF SUBORDINATION PROVISIONS.

      No right of any present or future holder of any Senior Indebtedness of the
Company to enforce the subordination  provisions of this Article 10 shall at any
time in any way be  prejudiced  or  impaired by any act or failure to act on the
part of the Company or by any act or failure to act, in good faith,  by any such





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holder,  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.  The  provisions of this Article 10 are
intended  to be for the benefit of, and shall be  enforceable  directly  by, the
holders of Senior Indebtedness.

SECTION 10.08.    AUTHORIZATION TO TRUSTEE TO TAKE ACTION TO EFFECTUATE
                  SUBORDINATION.

      Each Holder of Securities by his acceptance thereof authorizes and directs
the Trustee on his behalf to take such action as may be necessary or appropriate
to   effectuate,   as  between  the  Holders  and  the  holders  of  the  Senior
Indebtedness,  the subordination as provided in this Article 10 and appoints the
Trustee his attorney-in-fact for any and all such purposes.

SECTION 10.09.    SENIOR INDEBTEDNESS MAY BE RENEWED OR EXTENDED, ETC.

      Without  in any way  limiting  the  generality  of  Section  10.07 of this
Indenture,  the holders of Senior Indebtedness may, at any time and from time to
time,  without the consent of or notice to the Trustee or the  Holders,  without
incurring  responsibility  to the Holders and without impairing or releasing the
subordination  provided in this Article 10 or the  obligations  hereunder of the
Holders  to the  holders  of  Senior  Indebtedness,  do any  one or  more of the
following:  (a) change the manner,  place or terms of payment or extend the time
of  payment  of,  or renew  or  alter,  Senior  Indebtedness  or any  instrument
evidencing  the  same  or any  agreement  under  which  Senior  Indebtedness  is
outstanding or secured; (b) sell,  exchange,  release or otherwise deal with any
property  pledged,  mortgaged or otherwise  securing  Senior  Indebtedness;  (c)
release  any  Person  liable  in  any  manner  for  the   collection  of  Senior
Indebtedness; and (d) exercise or refrain from exercising any rights against the
Company and any other Person.

SECTION 10.10.    TRUSTEE TO HAVE NO FIDUCIARY DUTY TO HOLDERS OF SENIOR
                  INDEBTEDNESS.

      With respect to the holders of Senior Indebtedness, the Trustee undertakes
to perform or to  observe  only such of its  covenants  and  obligations  as are
specifically  set  forth  in this  Article  10,  and no  implied  covenants  and
obligations  with  respect to the holders of Senior  Indebtedness  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  Indebtedness  and the Trustee shall
not be liable  to any  holder  of  Senior  Indebtedness  if it shall pay over or
deliver to the  Holders,  the  Company or any other  Person  moneys or assets to
which any  holder of Senior  Indebtedness  shall be  entitled  by virtue of this
Article 10 or otherwise.

SECTION 10.11.    RIGHTS OF TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS.

      The Trustee  shall be entitled to all rights set forth in this  Article 10
in respect of any Senior Indebtedness at any time held by it, to the same extent




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as any other holder of Senior  Indebtedness  and nothing in this Indenture shall
be construed to deprive the Trustee of any of its rights as such holder.

SECTION 10.12.    NOTICE TO TRUSTEE.

      The Company shall give prompt written notice to the Trustee and any Paying
Agent of any fact known to the Company  which would  prohibit  the making of any
payment  of  moneys to or by the  Trustee  or any  Paying  Agent in  respect  of
Securities  pursuant to the  provisions  of this  Article 10 or  otherwise.  The
Trustee  shall not be charged with  knowledge  of the  existence of a default or
event of default with respect to all Senior Indebtedness or any other facts that
would  prohibit the making of any payment to or by the Trustee  unless and until
the Trustee shall have received  written  notice  thereof mailed or delivered to
the Trustee at its Corporate Trust Office signed by an Officer of the Company or
the holder or representative of any class of Senior  Indebtedness or any trustee
or agent  therefor;  and prior to the receipt of any such  written  notice,  the
Trustee  shall,  subject to Article 8, be  entitled to assume that no such facts
exist; PROVIDED that, if the Trustee shall not have received the notice provided
for in this  Section  10.12 at least two  Business  Days  prior to the date upon
which,  by the terms of this  Indenture,  any money shall become payable for any
purpose  (including,  without  limitation,  the  payment  of the  principal  or,
premium,  if any, or interest on any Security),  then  notwithstanding  anything
herein to the  contrary,  the  Trustee  shall have full power and  authority  to
receive  any money from the  Company  and to apply the same to the  purpose  for
which  they  were  received,  and  shall not be  affected  by any  notice to the
contrary  that may be  received  by it on or after such prior date except for an
acceleration of the Securities prior to such  application.  Nothing contained in
this Section  10.12 shall limit the right of the holders of Senior  Indebtedness
to recover  payments as contemplated by this Article 10. The foregoing shall not
apply if the Paying Agent is the Company.

      The Trustee  shall be entitled to rely on the  delivery to it of a written
notice by a Person  representing  himself or itself to be a holder of any Senior
Indebtedness  (or a trustee  on  behalf  of, or other  representative  of,  such
holder) to establish  that such notice has been given by a holder of such Senior
Indebtedness or a trustee or representative on behalf of any such holder. In the
event  that the  Trustee  determines  in good  faith that  further  evidence  is
required  with  respect  to the  right  of any  Person  as a  holder  of  Senior
Indebtedness  to  participate  in any payment or  distribution  pursuant to this
Article  10, the Trustee  may  request  such  Person to furnish  evidence to the
reasonable  satisfaction of the Trustee as to the amount of Senior  Indebtedness
held by such Person,  the extent to which such Person is entitled to participate
in such payment or  distribution  and any other facts pertinent to the rights of
such Person under this Article 10.

SECTION 10.13.    RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
                  AGENT.

      Upon any payment or  distribution  of assets or securities  referred to in
this Article 10, the Trustee and the Holders  shall be entitled to rely upon any




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order or decree made by any court of competent jurisdiction in which bankruptcy,
dissolution,  winding up, liquidation or reorganization proceedings are pending,
or upon a  certificate  of the  receiver,  trustee  in  bankruptcy,  liquidating
trustee,  agent or other  similar  Person  making such payment or  distribution,
delivered to the Trustee or to the Holders for the purpose of  ascertaining  the
Persons entitled to participate in such distribution,  the holders of the Senior
Indebtedness  and other  Indebtedness  of the  Company,  the  amount  thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article 10.

SECTION 10.14.    NOT TO PREVENT EVENTS OF DEFAULT.

      The failure to make a payment on account of principal of, premium, if any,
or interest on the Securities by reason of any provision of this Article 10 will
not be construed as preventing the occurrence of an Event of Default.

SECTION 10.15.    TRUSTEE'S COMPENSATION NOT PREJUDICED.

      Nothing  in this  Article  10 will  apply to  amounts  due to the  Trustee
pursuant to other sections of this Indenture.


                                  ARTICLE 11
                           CONVERSION OF SECURITIES

SECTION 11.01.    RIGHT TO CONVERT; MANDATORY CONVERSION.

      (a) The Holders of the Securities  shall have the right,  at the option of
each Holder,  at any time after one year  following  the Closing Date (except as
provided  in this  Section  11.01) to convert  any such  Security or any portion
thereof,  in  denominations  of $1,000  principal amount at maturity or integral
multiples  thereof,  into that  number  of fully  paid and  nonassessable  whole
Conversion Shares obtained by dividing (i) the aggregate Accreted Value, through
and including the date of  conversion,  of the Securities  being  converted by a
particular  Holder by (ii)  $.70,  subject to  adjustment  as  provided  in this
Article 11 (such ratio being the "Conversion Ratio").

      (b) If on any date of  determination  (i) the Closing  Price of the Common
Stock on the NASDAQ National or Small Cap Market or other  principal  securities
exchange or system on which the Common Stock is then traded,  if any, or (ii) if
not so traded,  then if the best bid  offered  price on the OTC  Bulletin  Board
Service  (the  "BBS")  on days when  transactions  in the  Common  Stock are not
effected,  or, on such days as transactions are effected on the BBS, the highest
price at which a trade was executed as reported to the National  Association  of
Securities Dealers, Inc. through the Automated Confirmation  Transaction Service
(the "OTC Price"),  during any period set forth below has exceeded the price for
such  period  set forth  below  for at least 20  consecutive  Trading  Days (the
"Market  Criteria," and such 20-day period being the "Market  Criteria  Period")
and the  Shelf  Registration  Statement with respect to the Conversion Shares is




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<PAGE>



effective  and  available,  then  all of the  Securities  will be  automatically
converted  on such date into that number of fully paid and  nonassessable  whole
Conversion  Shares  obtained by applying  the  Conversion  Ratio as specified in
paragraph (a) above of this Section 11.01; PROVIDED, HOWEVER, that if the Market
Criteria  is  satisfied  during  the third  year  after the  Closing  Date,  the
conversion  will not occur until the three-year  anniversary of the Closing Date
and will occur only if the Closing  Price or OTC Price,  as  applicable,  of the
Common Stock is at least $2.80 on such date:


          12 Months Beginning                        Closing Price
          -------------------                        -------------

           October 31, 1999                              $2.80

           October 31, 2000                              $3.25

            Except as provided  herein,  no payment or adjustment  shall be made
upon  conversion of any Security for interest  accrued  thereon or for dividends
paid on Common Stock of the Company prior to the close of business on the Record
Date for the determination of stockholders entitled to such dividends.

      If any Securities shall be called for redemption, the right to convert the
Securities designated for redemption shall terminate at the close of business on
the Trading Day next preceding the date fixed for redemption  unless the Company
defaults  in the  payment of the  Redemption  Price plus all  accrued and unpaid
interest.  In the event of default in the payment of the Redemption  Price,  the
right to convert the Securities designated for redemption shall terminate at the
close of business on the Business Day next  preceding the date that such default
is cured.

      If Securities not called for redemption are converted  (including pursuant
to Section  11.01(b))  after a Record Date for the payment of interest and prior
to  the  next  succeeding   Interest  Payment  Date,  such  Securities  must  be
accompanied by funds equal to the interest  payable on such succeeding  Interest
Payment Date on the principal amount so converted.

      The Conversion  Shares,  upon conversion of the Securities,  when the same
shall be issued in accordance with the terms hereof,  are hereby declared to be,
and shall be,  validly  issued,  fully paid and  nonassessable  shares of Common
Stock of the Company in the hands of the Holders thereof.

SECTION 11.02.    MECHANICS OF CONVERSION.

      In order to effect the conversion of any Security into Conversion  Shares,
the Holder of such  Security  shall  surrender  to the  Trustee or its agent the
Security to be converted  accompanied  by a duly  executed  notice of conversion
form set forth in the certificate  representing  such Security stating that such
Holder elects to convert all or a specified  portion of the principal  amount at
maturity  of  such  Security  in  accordance  with  the  provisions  hereof  and




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<PAGE>


specifying the name or names in which such Holder wishes the  Conversion  Shares
to be issued.  If more than one Security shall be surrendered  for conversion at
one time by the same Holder,  the number of full Conversion Shares issuable upon
conversion  thereof  shall be  computed on the basis of the  aggregate  Accreted
Value of all of the Securities so surrendered by such Holder at such time.

      In case such notice shall  specify a name or names other than that of such
Holder,  such  notice  shall be  accompanied  by payment of all  transfer  taxes
payable upon the issuance of Conversion Shares in such name or names. Other than
such taxes,  the Company  will pay any and all issue and other taxes (other than
taxes  based on income)  that may be payable in respect of any issue or delivery
of Conversion Shares upon conversion of Securities.

      As promptly as practicable and in any event within ten Business Days after
surrender of the  Securities  to be converted  and the receipt of such notice of
conversion  relating  thereto and, if applicable,  payment of all transfer taxes
(or the  demonstration  to the  satisfaction  of the Company that any such taxes
have been paid),  the Trustee or its agent will  instruct the Company to deliver
promptly to, or upon the written  order of, the Holder of the  Securities  to be
converted (i) certificates representing the number of validly issued, fully paid
and nonassessable  whole Conversion Shares to which the Holder of the Securities
being converted  shall be entitled,  (ii) any cash owing in lieu of a fractional
Conversion Share, determined in accordance with Section 11.04 and (iii) if fewer
than all the  Securities  surrendered  are being  converted,  a new  Security or
Securities,  of like tenor,  evidencing a principal  amount at maturity equal to
the principal  amount at maturity of the Securities  surrendered  for conversion
less the principal amount at maturity of the Securities  being  converted.  Such
conversion shall be deemed to have been made  immediately  prior to the close of
business on the date of such surrender of the Securities to be converted and the
making of any such required  payment.  Upon such  conversion,  the rights of the
Holder thereof as to the Securities  being  converted shall cease except for the
right to receive  Conversion  Shares (or such other  consideration  as  provided
herein)  in  accordance  herewith,  and  the  Person  entitled  to  receive  the
Conversion  Shares shall be treated for all purposes as having become the record
Holder of such  Conversion  Shares at such time.  All  Securities  delivered for
conversion  to the Trustee or its agent shall be canceled by or at the direction
of the Trustee, which shall thereafter dispose of the same.

      The  Company  shall not be  required  to convert  any  Securities,  and no
surrender  of  Securities  shall be  effective  for that  purpose,  while  stock
transfer  books of the Company for the Common  Stock are closed for any purposes
(but not for any period in excess of 15 days),  but the  surrender of Securities
for  conversion  during any period  while such books are so closed  shall become
effective for conversion immediately upon the reopening of such books, as if the
conversion  had been made on the date such  books  were  reopened,  and with the
application  of the  Conversion  Ratio in  effect at the date  such  books  were
reopened.

      The Holders of Securities are not entitled,  as such, to receive dividends
or other  distributions,  receive  notice of any  meeting  of the  stockholders,





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<PAGE>


consent  to any  action  of  the  stockholders,  receive  notice  of  any  other
stockholder proceedings, or to any other rights as stockholders of the Company.

SECTION 11.03.    ADJUSTMENT TO CONVERSION RATIO.

      The  denominator  of the  Conversion  Ratio shall be adjusted from time to
time as follows:

      (a) In case the Company shall hereafter pay a dividend  (excluding payment
of dividends on the Company's  Series A Preferred  Stock) or make a distribution
in Common Stock of the Company to all holders of the outstanding Common Stock of
the Company, the denominator of the Conversion Ratio 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 denominator of the Conversion Ratio by a fraction of
which the numerator shall be the number of Common Stock outstanding at the close
of business on the date 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 date fixed
for  such  determination.  The  Company  will not pay any  dividend  or make any
distribution on Common Stock held in the treasury of the Company.

      (b) In case the Company  shall  hereafter  issue rights or warrants to all
holders of its  outstanding  Common Stock  entitling them (for a period expiring
within 45 days after the date fixed for  determination of stockholders  entitled
to receive such rights or warrants) to subscribe for or purchase Common Stock at
a price per share less than the Current  Market Price (as defined  below) on the
date fixed for determination of stockholders  entitled to receive such rights or
warrants,  the denominator of the Conversion Ratio shall be adjusted so that the
same shall equal the number  determined by  multiplying  the  denominator of the
Conversion Ratio in effect immediately prior to the date fixed for determination
of  stockholders  entitled  to receive  such rights or warrants by a fraction of
which the numerator shall be the number of shares of Common Stock outstanding at
the close of  business  on the date  fixed  for  determination  of  stockholders
entitled to receive such rights or warrants  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 Common Stock  outstanding on the date fixed for determination of stockholders
entitled to receive such rights or warrants  plus the total number of additional
shares of Common Stock offered for  subscription  or purchase.  Such  adjustment
shall  become  effective  immediately  after the  opening of business on the day
following the date fixed for  determination of stockholders  entitled to receive
such rights or warrants. To the extent that Common Stock is not delivered, after
the expiration of such rights or warrants the denominator shall be readjusted to
the denominator  which would then be in effect had the adjustments made upon the
issuance of such  rights or warrants  been made on the basis of 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 denominator shall again be adjusted to
be the  denominator  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.



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<PAGE>



      (c) In case  the  outstanding  Common  Stock  shall be  subdivided  into a
greater  number of shares of Common Stock,  the  denominator  of the  Conversion
Ratio 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  Common Stock shall be combined into a smaller
number of shares of Common Stock,  the  denominator of the  Conversion  Ratio 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
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 (other than a
dividend  or  distribution  to  which  subparagraph  (a) of this  Section  11.03
applies) or evidences of its indebtedness or assets (including  securities,  but
excluding any rights or warrants referred to in subparagraph (b) of this Section
11.03,  and excluding any dividend or  distribution  (x) in connection  with the
liquidation,  dissolution  or winding up of the  Company,  whether  voluntary or
involuntary, (y) paid exclusively in cash or (z) referred to in subparagraph (a)
of  this  Section  11.03)  (any  of the  foregoing  being  hereinafter  in  this
subparagraph (d) referred to as the  "Distribution  Securities"),  then, in each
such case, unless the Company elects to reserve such Distribution Securities 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  Conversion  Shares  to which  such  Holder is
entitled, the amount and kind of such Distribution  Securities which such Holder
would have received if such Holder had, immediately prior to the Record Date for
such distribution of the Distribution Securities,  converted its Securities into
Conversion  Shares,  the denominator of the Conversion Ratio shall be reduced so
that the same shall equal the number  determined by multiplying  the denominator
of the Conversion  Ratio in effect on the Record Date by a fraction of which the
numerator  shall be the Current  Market  Price per share of Common  Stock on the
Record Date less the fair market value (as  determined by the Board of Directors
or, to the extent  permitted  by  applicable  law, a duly  authorized  committee
thereof, whose determination shall be conclusive,  and described in a resolution
of the Board of Directors or such duly authorized committee thereof, as the case
may be), on the Record Date,  of the portion of the  Distribution  Securities so
distributed applicable to one share of Common Stock and the denominator shall be
such  Current  Market  Price per share of the Common  Stock,  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 Distribution Securities 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 Holder of
Securities  shall have the right to receive upon  conversion the amount and kind
of  Distribution  Securities  such Holder  would have  received  had such Holder
converted each such Security on the Record Date.



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<PAGE>



In the event that such  dividend  or  distribution  is not so paid or made,  the
denominator  of  the  Conversion  Ratio  shall  again  be  adjusted  to  be  the
denominator  of the  Conversion  Ratio  which  would  then be in  effect if such
dividend or distribution  had not been declared.  If the Board of Directors (or,
to the extent permitted by applicable law, a duly authorized  committee thereof)
determines  the fair  market  value of any  distribution  for  purposes  of this
subparagraph  (d) by reference to the actual or when issued  trading  market for
any securities  comprising such  distribution,  it must in doing so consider the
prices in such market over the same period used in computing the Current  Market
Price of the Common Stock.

      For purposes of this  subparagraph  (d) and  subparagraphs  (a) and (b) of
this Section 11.03, any dividend or distribution  that includes Common Stock, or
rights or warrants to subscribe for or purchase  Common  Stock,  shall be deemed
instead to be (i) a dividend or distribution  of the evidences of  indebtedness,
assets or shares of  capital  stock  other than such  Common  Stock or rights or
warrants (and any reduction in the denominator of the Conversion  Ratio required
by this  subparagraph  (d) with respect to such dividend or  distribution  shall
then be made)  immediately  followed by (ii) a dividend or  distribution of such
Common  Stock or such  rights or  warrants  (and any  further  reduction  in the
denominator of the Conversion  Ratio required by subparagraph (a) or (b) of this
Section 11.03 with respect to such dividend or distribution shall then be made),
except (A) the Record Date of such dividend or  distribution  as defined in this
subparagraph  (d) shall be substituted as "the date fixed for the  determination
of  stockholders  entitled to receive such dividend or other  distribution"  and
"the date fixed for such determination"  within the meaning of subparagraphs (a)
and (b) of this Section 11.03 and (B) any Common Stock included in such dividend
or distribution shall not be deemed "outstanding at the close of business on the
date for such  determination"  within the  meaning of  subparagraph  (a) of this
Section 11.03.

      (e) In case the  Company  shall,  by dividend  or  otherwise,  at any time
distribute  to all holders of its Common Stock cash  (excluding  any  quarterly,
semi-annual,  annual or other  regularly  scheduled  cash  dividend  paid on the
Common Stock,  and excluding any dividend or distribution in connection with the
liquidation,  dissolution  or winding up of the  Company,  whether  voluntary or
involuntary), then, in such case, unless the Company elects to reserve such 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  Conversion  Shares  to which  such  Holder is
entitled,  the 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  Conversion  Shares,  the  denominator  of  the
Conversion  Ratio  shall be  reduced  so that the same  shall  equal the  number
determined by multiplying  the  denominator  of the  Conversion  Ratio in effect
immediately  prior to the Record Date by a fraction of which the numerator shall
be the  Current  Market  Price of the Common  Stock on the Record  Date less the
amount of cash so distributed (and not excluded as provided above) applicable to
one share of Common Stock and the denominator shall be such Current Market Price
of the Common Stock,  such reduction to become effective  immediately  prior the
opening of business on the day  following  the Record Date;  PROVIDED,  HOWEVER,
that in the event the portion of the cash so distributed applicable to one share



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<PAGE>


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 Holder of Securities  shall thereafter have
the right to receive upon  conversion  the amount of cash such Holder would have
received had he converted  each  Security on the Record Date.  In the event that
such dividend or  distribution  is not so paid or made,  the  denominator of the
Conversion Ratio shall again be adjusted to be the denominator of the Conversion
Ratio which would then be in effect if such  dividend  or  distribution  had not
been declared.

      (f) In  case a  tender  or  exchange  offer  made  by the  Company  or any
Subsidiary  of the  Company  for all or any  portion of the Common  Stock  shall
expire and such  tender or  exchange  offer  shall  involve  the  payment by the
Company or such Subsidiary of  consideration  per share of Common Stock having a
fair market value (as  determined  by the Board of  Directors  or, to the extent
permitted  by  applicable  law,  a  duly  authorized  committee  thereof,  whose
determination shall be conclusive, and described in a resolution of the Board of
Directors or such duly authorized  committee thereof, as the case may be) at the
last time (the "Expiration Time") tenders or exchanges may be made by holders of
Common Stock pursuant to such offer (as it shall have been amended) that exceeds
the Current Market Price of the Common Stock on the Trading Day next  succeeding
the Expiration Time, the denominator of the Conversion Ratio shall be reduced so
that such  denominator  shall equal the number  determined  by  multiplying  the
denominator  of  the  Conversion  Ratio  in  effect  immediately  prior  to  the
Expiration  Time by a  fraction  of which the  numerator  shall be the number of
shares of Common Stock outstanding  (including any tendered or exchanged 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 or  exchange  offer) of all
shares validly tendered or exchanged 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  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 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 or
exchange offer, but the Company is permanently  prevented by applicable law from
effecting  any  such  purchases  or  all  such  purchases  are  rescinded,   the
denominator  of  the  Conversion  Ratio  shall  again  be  adjusted  to  be  the
denominator of the Conversion Ratio which would then be in effect if such tender
or exchange offer had not been made.

      (g) The  Company  may  make  such  reductions  in the  denominator  of the
Conversion Ratio, in addition to those required by subparagraphs  (a), (b), (c),
(d), (e) and (f) of this Section 11.03,  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


                                      71


<PAGE>


to time may reduce the denominator of the Conversion Ratio by any amount for any
period of time if the period is at least 20 days,  the reduction is  irrevocable
during such period,  and the Board of Directors (or, to the extent  permitted by
applicable  law,  a  duly  authorized  committee  thereof)  shall  have  made  a
determination that such reduction would be in the best interests of the Company,
which  determination  shall  be  conclusive.  Whenever  the  denominator  of the
Conversion  Ratio is reduced  pursuant to the  preceding  sentence,  the Company
shall mail to Holders of record of the  Securities a notice of the  reduction at
least 15 days prior to the date the reduced  denominator of the Conversion Ratio
takes  effect,  and such  notice  shall  state the  reduced  denominator  of the
Conversion Ratio and the period it will be in effect.

      (h) No  adjustment in the  denominator  of the  Conversion  Ratio shall be
required  unless  such  adjustment  would  require an increase or decrease of at
least 1% in the  denominator of the Conversion  Ratio then in effect;  PROVIDED,
HOWEVER,  that any adjustments  which by reason of this subparagraph (h) are not
required  to be made  shall  be  carried  forward  and  taken  into  account  in
determining  whether any  subsequent  adjustment  shall be  required.  Except as
provided in this Section 11.03, the denominator of the Conversion Ratio will not
be adjusted for the issuance of Common Stock or any securities  convertible into
or  exchangeable  for Common  Stock or carrying the right to purchase any of the
foregoing.

      (i)  Notwithstanding  any other  provision of this Section  11.03,  in the
event that the Shelf  Registration  Statement is not  declared  effective by the
Commission  on or  prior to the date  that is one  year  after  the date of this
Indenture, the denominator of the Conversion Ratio will be decreased by $.15.

      (j)  Notwithstanding  any  other  provision  of  this  Section  11.03,  no
adjustment  to  the  denominator  of  the  Conversion  Ratio  shall  reduce  the
denominator of the Conversion  Ratio below the par value per share of the Common
Stock, and any such purported adjustment shall instead reduce the denominator of
the Conversion Ratio to such par value. The Company hereby covenants not to take
any action (i) to increase  the par value per share of the Common  Stock or (ii)
that would or does result in any adjustment in the denominator of the Conversion
Ratio that, if made without giving effect to the previous sentence,  would cause
the  denominator of the Conversion  Ratio to be less than the then par value per
share of the Common Stock, PROVIDED, HOWEVER, that the covenant in this sentence
shall be  suspended  if within ten days of  determining  in good faith that such
action would result in such adjustment (but not later than the Business Day next
following the  effectiveness  of such  adjustment),  the Company gives notice of
redemption of all outstanding Securities, and effects the redemption referred to
in such notice on the  redemption  date referred to therein in  compliance  with
Article 4, but the covenant in this sentence shall be  retroactively  reinstated
if such notice is not given or such redemption does not occur.

      (k) Whenever the denominator of the Conversion Ratio is adjusted as herein
provided,  the  Company  shall  promptly  file  with the  Trustee  an  Officers'
Certificate  setting forth the  denominator  after such  adjustment  and setting




                                      72


<PAGE>


forth a brief statement of the facts requiring such  adjustment.  Promptly after
delivery  of such  certificate,  the  Company  shall  prepare  a notice  of such
adjustment  of the  denominator  of the  Conversion  Ratio  setting  forth  such
adjusted denominator and the date on which each adjustment becomes effective and
shall mail such notice of such  adjustment of the  denominator of the Conversion
Ratio to the  Holder  of each  Security  at his last  address  appearing  on the
Security  Register provided for in Section 2.03, within 20 days, after execution
thereof.  Failure to deliver  such  notice  shall not  effect  the  legality  or
validity of any such supplement indenture. The Trustee shall be under no duty or
responsibility   with  respect  to  any   certificate  or  the  information  and
calculations contained therein.

      (l) In any case in which this Section  11.03  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 (y) issuing to the Holder of any
Securities  converted  after such Record Date and before the  occurrence of such
event the additional  Conversion  Shares issuable upon such conversion by reason
of the adjustment  required by such event over and above the  Conversion  Shares
issuable upon such  conversion  before giving effect to such  adjustment and (z)
paying to such  Holder any amount in cash in lieu of any  fractional  Conversion
Share.

      (m) For purposes of this Section 11.03, the following terms shall have the
meaning indicated:

                  (i) "Closing  Price" with respect to any securities on any day
means the  closing  sale 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 or Small Cap Market,
or, if such security is not listed or admitted to trading on such  exchange,  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 OTC Price or if an OTC Price is not  available,  in such manner as furnished
by any NASD 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 or,
to the extent permitted by applicable law, a duly authorized  committee thereof,
whose determination shall be conclusive.

                  (ii)  "Current  Market  Price"  means the average of the daily
Closing  Prices per share of Common Stock for the ten  consecutive  Trading Days
immediately prior to the date in question.

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





                                      73


<PAGE>



SECTION 11.04.    NO FRACTIONAL SHARES.

      No  fractional   Conversion  Shares  or  scrip   representing   fractional
Conversion  Shares shall be issued upon  conversion of Securities.  If more than
one Security shall be surrendered for conversion at one time by the same Holder,
the number of whole shares issuable upon conversion thereof shall be computed on
the basis of the aggregate  number of Securities so surrendered.  Instead of any
fractional  Conversion Share that would otherwise be issuable upon conversion of
any  Securities,  the  Company  shall pay a cash  adjustment  in respect of such
fractional  interest in an amount equal to the same fraction of the market price
per share of Common Stock of the Company (as  determined  or  prescribed  by the
Board of  Directors,  or, to the  extent  permitted  by  applicable  law, a duly
authorized  committee  thereof,  whose  determination  shall be conclusive,  but
which,  if the Common Stock is listed on the NASDAQ National or Small Cap Market
or other principal  securities exchange or system, shall be the Closing Price of
the NASDAQ National or Small Cap Market or other principal  securities  exchange
or system and if not so traded,  shall be the OTC Price,  if  available)  at the
close  of  business  on the  Trading  Day  immediately  preceding  the  date  of
conversion.

SECTION 11.05.    RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE
                  OF ASSETS.

      In the case of (a) any  reclassification  or change of the Common Stock of
the Company, (b) a consolidation, merger or combination involving the Company or
(c) a sale or  conveyance to another  corporation  of the property and assets of
the Company as an entirety or  substantially  as an entirety,  in each case as a
result of which  holders of Common  Stock shall be  entitled  to receive  stock,
other  securities,  other property or assets (including cash) with respect to or
in  exchange  for  such  Common  Stock,  the  Holders  of  the  Securities  then
outstanding will be entitled thereafter to convert such Securities into the kind
and amount of shares of stock,  other  securities  or other  property  or assets
which  they  would  have   owned  or  been   entitled   to  receive   upon  such
reclassification, change, consolidation, merger, combination, sale or conveyance
had such Securities been converted into Conversion  Shares  immediately prior to
such  reclassification,  change,  consolidation,  merger,  combination,  sale or
conveyance assuming that a Holder of the Securities would not have exercised any
rights of election as to the stock, other securities or other property or assets
in connection therewith.

SECTION 11.06.    SPECIFIC PERFORMANCE.

      Without  limiting  the  remedies  available  to the  Holders,  the Company
acknowledges  that any  failure by the  Company to comply  with its  obligations
under this Article 11 may result in material  irreparable  injury to the Holders
for which  there is no adequate  remedy at law,  that it will not be possible to
measure  damages for such injuries  precisely and that, in the event of any such
failure,  any Holder may,  notwithstanding any other provision contained in this
Indenture,  obtain such relief as may be  required to  specifically  enforce the
Company's obligations under this Article 11.



                                      74


<PAGE>



SECTION 11.07     COMPANY TO RESERVE COMMON STOCK.

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

SECTION 11.08     RESPONSIBILITY OF TRUSTEE FOR CONVERSION PROVISIONS.

      The Trustee,  subject to the provisions of Section 8.01,  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 Ratio, or with respect to the nature or extent of any such adjustment
when  made,  or  with  respect  to the  method  employed,  or  herein  or in any
supplemental indenture provided to be employed, in making the same, or whether a
supplemental  indenture  need be  entered  into.  The  Trustee,  subject  to the
provisions  of  Section  8.01,  shall not be  accountable  with  respect  to the
validity or value (or the kind or amount) of any Common  Stock,  or of any other
securities  or  property or cash,  which may at any time be issued or  delivered
upon the  conversion  of any Security;  and it does not make any  representation
with respect  thereto.  The Trustee,  subject to the provisions of Section 8.01,
shall not be responsible for any failure of the Company to make or calculate any
cash  payment or to issue,  transfer  or deliver  any shares of Common  Stock or
share certificates or other securities or property or cash upon the surrender of
any Security  for the purpose of  conversion;  and the  Trustee,  subject to the
provisions  of Section  8.01,  shall not be  responsible  for any failure of the
Company to comply with any of the  covenants  of the Company  contained  in this
Article.


                                  ARTICLE 12
                                 MISCELLANEOUS

SECTION 12.01.    NOTICES.

      Any notice or  communication by the Company or the Trustee to the other is
duly given if in writing and delivered in Person or mailed by  registered  mail,
return   receipt   requested,   telex,   telecopier  or  overnight  air  courier
guaranteeing next day delivery, to the other at the following address:




                                      75


<PAGE>



      If to the Company:

                  International Fast Food Corporation
                  1000 Lincoln Road
                  Suite 200
                  Miami Beach, FL  33139
                  Telephone:  305-531-5800
                  Telecopier:  305-538-5037
                  Attention:  Mitchell Rubinson

                  with a copy to:

                  Greenberg Traurig Hoffman
                  Lipoff Rosen & Quentel, P.A.
                  1221 Brickell Avenue
                  Miami, FL   33131
                  Telephone:  305-579-0500
                  Telecopier:  305-579-0717
                  Attention: Gary Epstein, Esq.

      If to the Trustee:

                  Marine Midland Bank, as Trustee
                  140 Broadway, 12th Floor
                  New York, New York  10005
                  Telephone: 212-658-6433
                  Telecopier: 212-658-6425
                  Attention:  Corporate Trust Department - IFFC

                  with a copy to:

                  Winston & Strawn
                  200 Park Avenue
                  New York, New York  10166
                  Telephone: 212-294-6711
                  Telecopier: 212-294-4700
                  Attention: Jeffrey H. Elkin, Esq.


      The  Company  or the  Trustee,  by  notice  to  the  other  may  designate
additional or different addresses for subsequent notices or communications.





                                      76


<PAGE>



      All notices  and  communications  (other  than those sent to the  Trustee)
shall be deemed  to have been duly  given:  at the time  delivered  by hand,  if
personally  delivered;  five  Business  Days after being  deposited in the mail,
postage  prepaid,  if mailed;  when  answered  back,  if telexed;  when  receipt
acknowledged,  if telecopied; and the next Business Day after timely delivery to
the courier,  if sent by overnight air courier  guaranteeing  next day delivery.
Notices and  communications  to the  Trustee  shall be deemed to have been given
only upon receipt.

      Any notice or  communication  to a Holder  shall be mailed by first  class
mail, or by overnight air courier  guaranteeing next day delivery to its address
shown  on the  register  kept by the  Registrar.  Failure  to mail a  notice  or
communication  to a Holder or any defect in it shall not affect its  sufficiency
with respect to other Holders.

      If a notice or communication  (other than to the Trustee) is mailed in the
manner provided above within the time prescribed,  it is duly given,  whether or
not the addressee receives it.

      If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.

SECTION 12.02.    CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.

      Upon any request or  application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:

            (a) an  Officers'  Certificate  in  form  and  substance  reasonably
      satisfactory  to the Trustee (which shall include the statements set forth
      in Section 12.03 hereof) stating that, in the opinion of the signers,  all
      conditions precedent and covenants, if any, provided for in this Indenture
      relating to the proposed action have been satisfied; and

            (b)  an  Opinion  of  Counsel  in  form  and  substance   reasonably
      satisfactory  to the Trustee (which shall include the statements set forth
      in Section 12.03 hereof) stating that, in the opinion of such counsel, all
      such conditions precedent and covenants have been satisfied.

SECTION 12.03.    STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.

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

            (a) a statement  that the Person making such  certificate or opinion
      has read such covenant or condition;




                                       77


<PAGE>



            (b) 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;

            (c) a statement  that, in the opinion of such Person,  he or she 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 satisfied; and

            (d) a statement as to whether or not, in the opinion of such Person,
      such condition or covenant has been satisfied.

SECTION 12.04.    RULES BY TRUSTEE AND AGENTS.

      The  Trustee  may make  reasonable  rules for action by or at a meeting of
Holders.  The  Registrar  or  Paying  Agent  may make  reasonable  rules and set
reasonable requirements for its functions.

SECTION 12.05.    NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES
                  AND STOCKHOLDERS.

       No recourse  for the payment of the  principal  of,  premium,  if any, or
interest on any of the Securities or for any claim based thereon or otherwise in
respect  thereof,  and no  recourse  under or upon any  obligation,  covenant or
agreement  of the  Company in this  Indenture,  or in any of the  Securities  or
because of the creation of any Indebtedness  represented  thereby,  shall be had
against  any  incorporator,   shareholder,   officer,   director,   employee  or
controlling  person of the  Company or of any  successor  Person  thereof.  Each
Holder, by accepting the Securities, waives and releases all such liability.

SECTION 12.06.    GOVERNING LAW.

      THE  INTERNAL  LAW OF THE STATE OF NEW YORK  SHALL  GOVERN  AND BE USED TO
CONSTRUE THIS  INDENTURE AND THE  SECURITIES.  THE COMPANY HEREBY SUBMITS TO THE
JURISDICTION OF THE FEDERAL AND NEW YORK STATE COURTS LOCATED IN THE CITY OF NEW
YORK IN  CONNECTION  WITH ANY DISPUTE  RELATED TO THIS  INDENTURE  OR ANY OF THE
MATTERS  CONTEMPLATED  HEREBY. THE COMPANY AGREES THAT ANY LEGAL SUIT, ACTION OR
PROCEEDING  BROUGHT BY THE TRUSTEE OR THE HOLDERS TO ENFORCE ANY RIGHTS UNDER OR
WITH RESPECT TO THIS  INDENTURE  MAY BE INSTITUTED IN ANY STATE OR FEDERAL COURT
IN THE CITY OF NEW  YORK,  STATE OF NEW  YORK,  WAIVES,  TO THE  FULLEST  EXTENT
PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF VENUE OF ANY SUCH SUIT,  ACTION OR PROCEEDING AND IRREVOCABLY  SUBMITS TO THE
NON-EXCLUSIVE  JURISDICTION  OF ANY  SUCH  COURT  IN ANY SUCH  SUIT,  ACTION  OR
PROCEEDING.


                                      78


<PAGE>




SECTION 12.07.    NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.

      This Indenture may not be used to interpret any other  indenture,  loan or
debt agreement of the Company or its  Subsidiaries  or of any other Person.  Any
such  indenture,  loan or debt  agreement  may  not be  used to  interpret  this
Indenture.

SECTION 12.08.    SUCCESSORS.

      All agreements of the Company in this  Indenture and the Securities  shall
bind its successors.  All agreements of the Trustee in this Indenture shall bind
its successors.

SECTION 12.09.    SEVERABILITY.

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

SECTION 12.10.    COUNTERPART ORIGINALS.

      The parties may sign any number of copies of this  Indenture.  Each signed
copy  shall  be an  original,  but  all of  them  together  represent  the  same
agreement.

SECTION 12.11.    TABLE OF CONTENTS, HEADINGS, ETC.

      The Table of Contents  and  Headings of the  Articles and Sections of this
Indenture have been inserted for  convenience of reference  only, and are not to
be  considered a part of this  Indenture  and shall in no way modify or restrict
any of the terms or provisions hereof.

                        [Signatures on following page]






                                      79


<PAGE>



                                  SIGNATURES


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


                                    INTERNATIONAL FAST FOOD
                                    CORPORATION




                                    By: /s/ Mitchell Rubinson
                                       -----------------------------------------
                                        Name: Mitchell Rubinson
                                        Title:  Chairman of the Board, President
                                                and Chief Executive Officer





                                    MARINE MIDLAND BANK, as Trustee



                                   By: /s/ Frank Godino
                                      ------------------------------------------
                                       Name: Frank Godino
                                       Title: Assistant Vice President









                                       80


<PAGE>

================================================================================



                                   EXHIBIT A

                              [Form of Security]


















                                       A-1


<PAGE>



                                                                       EXHIBIT A
  


          THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933,  AS AMENDED (THE  "SECURITIES  ACT"),  OR ANY STATE  SECURITIES  LAWS AND,
ACCORDINGLY,  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  BELOW.  BY ITS
ACQUISITION  HEREOF,  THE  HOLDER  (1)  REPRESENTS  THAT  IT IS  AN  "ACCREDITED
INVESTOR" (AS DEFINED IN RULE 501 OF REGULATION D UNDER THE SECURITIES  ACT) (AN
"ACCREDITED  INVESTOR"),  (2) AGREES  THAT IT WILL NOT,  WITHIN THE TIME  PERIOD
REFERRED TO IN RULE 144(k) UNDER THE  SECURITIES ACT AS IN EFFECT ON THE DATE OF
TRANSFER OF THIS  SECURITY,  RESELL OR OTHERWISE  TRANSFER THIS SECURITY  EXCEPT
PURSUANT  TO AN  EXEMPTION  FROM,  OR  IN A  TRANSACTION  NOT  SUBJECT  TO,  THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE
TO EACH PERSON TO WHOM THIS SECURITY IS  TRANSFERRED A NOTICE  SUBSTANTIALLY  TO
THE EFFECT OF THIS LEGEND.  IN  CONNECTION  WITH ANY  TRANSFER OF THIS  SECURITY
WITHIN  THE TIME  PERIOD  REFERRED  TO ABOVE,  THE HOLDER  SHALL,  PRIOR TO SUCH
TRANSFER,   FURNISH  TO  THE  REGISTRAR,   THE  TRUSTEE  AND  THE  COMPANY  SUCH
CERTIFICATIONS,  LEGAL  OPINIONS  OR  OTHER  INFORMATION  AS  ANY  OF  THEM  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 SECURITY  WAS ISSUED  WITH "ORIGINAL  ISSUE  DISCOUNT." THE ISSUE
PRICE IS $726.33 FOR EACH $1,000 OF STATED PRINCIPAL AMOUNT.  THE ORIGINAL ISSUE
DISCOUNT IS $273.67 OF STATED  PRINCIPAL  AMOUNT.  THE ISSUE DATE IS NOVEMBER 5,
1997. THE YIELD TO MATURITY IS 11%, COMPOUNDED SEMI-ANNUALLY.












                                     A-2


<PAGE>



                              INTERNATIONAL FAST
                               FOOD CORPORATION

          11% CONVERTIBLE SENIOR SUBORDINATED DISCOUNT NOTE DUE 2007

                                                          CUSIP No. __________

No.                                                                $__________

           INTERNATIONAL  FAST  FOOD  CORPORATION,  a Florida  corporation  (the
"Company"),  for value  received,  promises  to pay to  ________________  or its
registered  assigns the  principal  sum of  ___________  Dollars  (which  amount
includes amortization of the original issue discount) on ____________, 2007.

           Reference  is  made  to  the  further  provisions  of  this  Security
contained  herein,  which will for all  purposes  have the same effect as if set
forth in this place.

           IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officers.

      Dated: ____________, 1997

      INTERNATIONAL FAST FOOD CORPORATION


      By: _____________________________________
             Name:
             Title:


      By: _____________________________________
             Name:
             Title:






                                     A-3


<PAGE>



Trustee's Certificate of Authentication

Dated:_____________________

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

Marine Midland Bank,
as Trustee

By:   Bankers Trust Company
      as Authenticating Agent

      By: __________________________
            Authorized Signatory


















                                     A-4


<PAGE>



                             (Reverse of Security)

          11% Convertible Senior Subordinated Discount Note Due 2007

      1.    PRINCIPAL AND INTEREST.

      The Company will pay the principal of this Note on October 31, 2007.

      The Company  promises to pay interest on the principal amount of this Note
on each Interest  Payment Date, as set forth below,  at the rate per annum shown
above.

      Interest  will be payable  semi-annually  (to the holders of record of the
Notes at the close of  business  on the  April 15 or  October  15 (the  "Regular
Record Dates") immediately preceding the Interest Payment Date) on each Interest
Payment Date,  commencing April 30, 2001; PROVIDED that no interest shall accrue
on the  principal  amount of this Note prior to October 31, 2000 and no interest
shall be paid on this Note prior to April 30, 2001.

      From and after  October 31,  2000,  interest on the Notes will accrue from
the most recent date to which interest has been paid or, if no interest has been
paid, from October 31, 2000;  PROVIDED that, if there is no existing  default in
the payment of interest and this Note is authenticated  between a Regular Record
Date and the next succeeding  Interest Payment Date,  interest shall accrue from
such Interest Payment Date.  Interest will be computed on the basis of a 360-day
year of twelve 30-day months.

      The Company  shall pay, to the extent such  payments are lawful,  interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue principal and premium,  if any, and interest from time to time on demand
at the  rate  borne  by the  Securities  plus 2% per  annum.  Interest  shall be
computed on the basis of a 360-day year comprised of twelve 30-day months.

      2.    METHOD OF PAYMENT.

      The Company  will pay  principal as provided  above and  interest  (except
defaulted  interest) on the principal  amount of the Notes as provided  above on
each April 30 and October 31 to the persons who are Holders (as reflected in the
Security  Register  at the  close of  business  on the April 15 and  October  15
immediately preceding the Interest Payment Date), in each case, even if the Note
is canceled on  registration  of transfer or registration of exchange after such
record  date;  PROVIDED  that,  with  respect to the payment of  principal,  the
Company will not make payment to the Holder unless this Note is surrendered to a
Paying Agent.

      The Company will pay principal,  premium,  if any, and as provided  above,
interest  in money of the  United  States  that at the time of  payment is legal
tender for payment of public and  private  debts.  However,  the Company may pay




                                     A-5


<PAGE>


principal,  premium,  if any,  and  interest by its check  payable in such money
mailed to a Holder's registered address (as reflected in the Security Register).
If a payment  date is a date other than a  Business  Day at a place of  payment,
payment may be made at that place on the next  succeeding day that is a Business
Day and no interest shall accrue for the intervening period.

      3.    PAYING AGENT AND REGISTRAR.

      Initially,  Bankers Trust Company will act as Authenticating Agent, Paying
Agent and Registrar.  The Company may change any  Authenticating  Agent,  Paying
Agent or Registrar without notice.  Subject to certain exceptions,  the Company,
any  Subsidiary  or any  Affiliate  of any of  them  may  act as  Paying  Agent,
Registrar or co-Registrar.

      4.    INDENTURE; LIMITATIONS.

      The Company  issued the Notes under an  Indenture  dated as of November 5,
1997 (the "Indenture"),  between the Company and Marine Midland Bank, as trustee
(the "Trustee").  Capitalized  terms herein are used as defined in the Indenture
unless  otherwise  indicated.  The  Notes  are  subject  to all the terms of the
Indenture  and Holders are referred to the Indenture for a statement of all such
terms.  To  the  extent  permitted  by  applicable  law,  in  the  event  of any
inconsistency between the terms of this Note and the terms of the Indenture, the
terms of the Indenture shall control.

      The Notes are unsecured  senior  subordinated  indebtedness of the Company
and will be  junior  in right of  payment  to all  existing  and  future  Senior
Indebtedness of the Company.  The Indenture limits the original aggregate stated
principal amount at maturity of the Notes to $27,536,000.

      5.    REDEMPTION.

      The Notes will be  redeemable,  at the  Company's  option,  in whole or in
part,  at any time or from time to time,  on or after October 31, 2002 and prior
to maturity, upon not less than 30 nor more than 60 days' prior notice mailed by
first-class  mail to each  Holders'  last  address as it appears in the Security
Register,  at the following  Redemption  Prices (expressed in percentages of the
Accreted  Value  thereof),  plus  accrued  and unpaid  interest,  if any, to the
Redemption  Date  (subject  to the right of  Holders  of record on the  relevant
Regular  Record  Date  that is on or prior  to the  Redemption  Date to  receive
interest due on an Interest  Payment Date that is on or prior to the  Redemption
Date) if  redeemed  during the  12-month  period  commencing  October 31, of the
applicable year set forth below:





                                     A-6


<PAGE>




                 Year                              Redemption Price
                 ----                              ----------------

                 2002                                  105.500%

                 2003                                  104.000%

                 2004                                  102.500%

                 2005                                  101.000%

                 2006 and thereafter                   100.000%

      6.    NOTICE OF REDEMPTION.

      Notice of any optional  redemption will be mailed at least 30 days but not
more  than 60 days  before  the  Redemption  Date to each  Holder of Notes to be
redeemed at his last  address as it appears in the Security  Register.  Notes in
original denominations larger than $1,000 pay be redeemed in part; PROVIDED that
Notes  will only be  issued  in  denominations  of  $1,000  principal  amount at
maturity  or  integral  multiples  thereof.  On and after the  Redemption  Date,
interest  ceases to accrue on Notes or portions of Notes called for  redemption,
unless the Company defaults in the payment of the Redemption Price.

      7.    REPURCHASE UPON CHANGE IN CONTROL.

      Upon the  occurrence of any Change of Control,  each Holder shall have the
right to require the  repurchase of its Notes by the Company in cash pursuant to
the offer  described in the  Indenture at a purchase  price equal to 101% of the
Accreted Value thereof, plus accrued and unpaid interest, if any, to the date of
purchase (the "Change of Control Payment").

      A notice of such Change of Control will be mailed within 30 days after any
Change of Control occurs to each Holder at his last address as it appears in the
Security  Register.  Notes in original  denominations  larger than $1,000 may be
sold to the  Company  in part;  PROVIDED  that  Notes  will  only be  issued  in
denominations  of $1,000  principal  amount at maturity  or  integral  multiples
thereof.  On and after the Change of Control  Payment Date,  interest  ceases to
accrue on Notes or portions of Notes  surrendered  for  purchase by the Company,
unless the Company defaults in the payment of the Change of Control Payment.

      8.    CONVERSION.

      Subject to and upon compliance  with the provisions of the Indenture,  the
Holders of the Securities shall have the right, at the option of each Holder, at
any time after one year  following  the Closing Date (except as provided in this
Section 8 or in the  Indenture)  to convert  any such  Security  or any  portion



                                     A-7


<PAGE>


thereof,  in  denominations  of $1,000  principal amount at maturity or integral
multiples  thereof,  into that  number  of fully  paid and  nonassessable  whole
Conversion  Shares  obtained by dividing  the  aggregate  Accreted  Value of the
Securities  being  converted  on such date by $.70,  subject  to  adjustment  in
certain events (the "Conversion Ratio").

      Subject  to  the  provisions  of  the   Indenture,   if  on  any  date  of
determination  (a) the Closing Price of the Common Stock on the NASDAQ  National
or Small Cap Market or other  principal  securities  exchange or system on which
the Common  Stock is then traded,  if any, or (b) if not so traded,  then if the
best bid offered  price on the OTC  Bulletin  Board  Service (the "BBS") on days
when  transactions  in the Common  Stock are not  effected,  or, on such days as
transactions  are  effected on the BBS,  the highest  price at which a trade was
executed as reported to the National  Association  of Securities  Dealers,  Inc.
through the Automated Confirmation Transaction Service (the "OTC Price"), during
any  period set forth  below has  exceeded  the price for such  period set forth
below for at least 20 consecutive  Trading Days (the "Market Criteria," and such
20-day period being the "Market Criteria Period") and (b) the Shelf Registration
Statement with respect to the Conversion Shares is effective and available, then
all of the  Securities  will be  automatically  converted on such date into that
number of fully paid and  nonassessable  whole  Conversion  Shares  obtained  by
applying the aforementioned  Conversion Ratio;  PROVIDED,  HOWEVER,  that if the
Market  Criteria is satisfied  during the third year after the Closing Date, the
conversion  will not occur until the three-year  anniversary of the Closing Date
and will occur only if the Closing  Price or OTC Price,  as  applicable,  of the
Common Stock of the Company is at least $2.80 on such date:


          12 Months Beginning                        Closing Price
          -------------------                        -------------

           October 31, 1999                              $2.80

           October 31, 2000                              $3.25

      If Notes not called for  redemption are converted  (including  pursuant to
mandatory  conversion) after a record date for the payment of interest and prior
to the next succeeding  Interest Payment Date, such Notes must be accompanied by
funds equal to the interest payable on such succeeding  Interest Payment Date on
the principal amount so converted.

      The  denominator of the Conversion  Ratio is subject to adjustment  (under
formula  set forth in the  Indenture)  in  certain  events,  including:  (i) the
issuance of Common  Stock as a dividend or  distribution  on Common Stock to all
Holders  of  the  outstanding  Common  Stock;  (ii)  certain   subdivisions  and
combinations  of the Common  Stock;  (iii) the issuance to all Holders of Common
Stock of certain  rights or  warrants to  purchase  additional  shares of Common
Stock; (iv) the distribution to all holders of Common Stock of shares of capital
stock of the Company (other than Common Stock) or evidences of  indebtedness  of
the  Company  or assets  (including  securities,  but  excluding  those  rights,
warrants,  dividends  and  distributions  referred  to above and  dividends  and
distributions in connection with the  liquidation,  dissolution or winding up of
the Company or paid in cash); (v)  distributions  consisting of cash,  excluding



                                     A-8


<PAGE>


any quarterly,  semi-annual,  annual or other regularly  scheduled cash dividend
paid on the Common  Stock;  and (vi)  payment in respect of a tender or exchange
offer by the  Company or any of its  Subsidiaries  for the  Common  Stock to the
extent  that the cash and  value of any  other  consideration  included  in such
payment per share of Common Stock exceeds the Current  Market Price per share of
Common Stock on the Trading Day next  succeeding  the last date on which tenders
or exchanges may be made pursuant to such tender or exchange.

      In the case of (i) any  reclassification  or change of the  Common  Stock,
(ii) a  consolidation,  merger or  combination  involving the Company or (iii) a
sale or  conveyance  to another  corporation  of the  property and assets of the
Company as an entirety or substantially  as an entirety,  in each case as result
of which  holders of Common  Stock  shall be entitled  to receive  stock,  other
securities,  or other property or assets  (including cash) with respect to or in
exchange for such Common Stock,  the Holders of the Securities then  outstanding
will be entitled  thereafter to convert such Securities into the kind and amount
of shares of stock,  other  securities  or other  property or assets  which they
would have owned or 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.

      The Company from time to time may, to the extent  permitted by law, reduce
the denominator of the Conversion Ratio by any amount for any period of at least
20 days,  in which case the Company  shall give at least 15 days' notice of such
reduction,  if the  Board  of  Directors  has  made a  determination  that  such
reduction  would be in the best  interests of the Company,  which  determination
shall be conclusive. The Company may, at its option, make such reductions in the
denominator of the Conversation  Ratio as the Board of Directors deems advisable
to avoid or diminish  any income tax to holders of 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.

      If any Securities shall be called for redemption, the right to convert the
Securities designated for redemption shall terminate at the close of business on
the Trading Day next preceding the date fixed for redemption  unless the Company
defaults  in the  payment of the  Redemption  Price plus all  accrued and unpaid
interest.  In the event of default in the payment of the Redemption  Price,  the
right to convert the Securities designated for redemption shall terminate at the
close of business on the Business Day next  preceding the date that such default
is cured.

      The  Company  shall not be  required  to convert  any  Securities,  and no
surrender of Securities  shall be effective  for that  purpose,  while the stock
transfer  books of the Company for the Common  Stock are closed for any purposes
(but not for any period in excess of 15 days),  but the  surrender of Securities
for  conversion  during any period  while such books are so closed  shall become
effective for conversion immediately upon the reopening of such books, as if the



                                     A-9


<PAGE>



conversion  had been made on the date such  books  were  reopened,  and with the
application  of the  Conversion  Ratio in  effect at the date  such  books  were
reopened.

      If a Security is converted into Conversion Shares on any date, then on and
after such date such Security  ceases to be outstanding and interest on it shall
cease to accrue.

      The Conversion  Shares,  upon conversion of the Securities,  when the same
shall be issued in accordance  with the terms hereof,  are hereby declared to be
and shall be fully paid and nonassessable  shares of Common Stock of the Company
in the hands of the Holders thereof. The Holders of Securities are not entitled,
as such,  to receive  dividends or other  distributions,  receive  notice of any
meeting of the stockholders,  consent to any action of the stockholders, receive
notice  of  any  other  stockholder  proceedings,  or to  any  other  rights  as
stockholders of the Company.

      9.    DENOMINATIONS; TRANSFER; EXCHANGE.

      The Notes are in  registered  form  without  coupons in  denominations  of
$1,000 of principal amount at maturity and integral  multiples thereof. A Holder
may register the transfer or exchange of Notes in accordance with the Indenture.
The Registrar may require a Holder,  among other things, to furnish  appropriate
endorsements  and transfer  documents  and to pay any taxes and fees required by
law or permitted by the Indenture.  The Registrar need not register the transfer
or exchange or any Notes selected for redemption. Also, it need not register the
transfer or exchange of any Notes for a period of 15 days before a selection  of
Notes to be redeemed is made.

      10.   PERSONS DEEMED OWNERS.

      A Holder shall be treated as the owner of a Note for all purposes.

      11.   UNCLAIMED MONEY.

      If money for the  payment  of  principal,  premium,  if any,  or  interest
remains  unclaimed for two years,  the Trustee and the Paying Agent will pay the
money back to the Company at its request.  After that,  Holders  entitled to the
money must look to the Company for payment,  unless an applicable law designates
another  Person,  and all  liability  of the Trustee and such Paying  Agent with
respect to such money shall cease.

      12.   AMENDMENT; SUPPLEMENT; WAIVER.

      Subject to certain  exceptions,  the Indenture or the Notes may be amended
or  supplemented  with the  consent of the  Holders  of at least a  majority  in
aggregate  principal amount at maturity of the Notes then  outstanding,  and any
existing default or compliance with any provision may be waived with the consent




                                     A-10


<PAGE>


of the  Holders of at least a majority  in  principal  amount at maturity of the
Notes then  outstanding.  Without  notice to or the consent of any  Holder,  the
parties  thereto may amend or  supplement  the  Indenture or the Notes to, among
other things,  cure any ambiguity,  defect or inconsistency  and make any change
that does not materially and adversely affect the rights of any Holder.

      13.   RESTRICTIVE COVENANTS.

      The Indenture  imposes  certain  limitations on the ability of the Company
and its  Restricted  Subsidiaries,  among  other  things  to:  incur  additional
indebtedness;  create liens;  pay dividends or make  distributions in respect of
their capital stock; make investments or make certain other restricted payments;
sell  assets;  issue  or sell  stock  of  Restricted  Subsidiaries;  enter  into
transactions  with  stockholders  or  affiliates;  engage in unrelated  lines of
business;  or  consolidate,  merge  or sell  all or  substantially  all of their
assets.  Within 90 days after the end of the last  fiscal  quarter of each year,
the Company must report to the Trustee on compliance with such limitations.

      14.   SUCCESSOR PERSONS.

      Generally,  when a  successor  person  or  other  entity  assumes  all the
obligations  of  its  predecessor  under  the  Notes  and  the  Indenture,   the
predecessor person will be released from those obligations.

      15.   DEFAULTS AND REMEDIES.

      The following events  constitute  "Events of Default" under the Indenture:
(a) default in the payment of principal of (or premium,  if any, on) or interest
on  any  Note  when  the  same  becomes  due  and  payable  at  maturity,   upon
acceleration,  redemption or otherwise whether or not such payment is prohibited
by the  subordination  provisions of the Indenture;  (b) the Company defaults in
the performance of any covenant set forth in Section 5.03, 5.04, 5.10 or 5.13 of
the Indenture,  and the default  continues for a period of 15  consecutive  days
after  written  notice  by the  Trustee  or by the  Holders  of 25% or  more  in
aggregate  principal  amount  of the Notes  then  outstanding;  (c) the  Company
defaults in the  performance  of or breaches any other  covenant or agreement of
the  Company  in the  Indenture  or under the Notes and such  default  or breach
continues  for a period  of 30  consecutive  days  after  written  notice by the
Trustee or the Holders of 25% or more in aggregate  principal amount at maturity
of the  Notes;  (d)  either  of the New  BKC  Development  Agreement  or the New
Domino's Master Franchise Agreement shall be suspended or terminated;  (e) there
occurs with respect to any issue or issues of Indebtedness of the Company or any
Significant  Subsidiary  having an outstanding  principal  amount at maturity of
$3,000,000  or more in the  aggregate  for all such issues of all such  Persons,
whether such Indebtedness now exists or shall hereafter be created, (A) an event
of default that has caused the holder thereof to declare such Indebtedness to be
due and payable prior to its Stated Maturity and such  Indebtedness has not been
discharged  in full or such  acceleration  has not been  rescinded  or  annulled
within 30 days of such acceleration and/or (B) the failure to make any principal




                                     A-11


<PAGE>


payment with respect to any fixed maturity and such defaulted  payment shall not
have been made,  waived or extended within 30 days of such payment default;  (f)
any final  judgment or order (not covered by insurance) for the payment of money
in excess of $5,000,000 in the aggregate for all such final  judgments or orders
against all such Persons (treating any deductibles,  self-insurance or retention
as not so  covered)  shall be rendered  against  the Company or any  Significant
Subsidiary and shall not be paid or discharged, and there shall be any period of
60 consecutive  days following  entry of the final judgment or order that causes
the aggregate amount for all such final judgments or orders  outstanding and not
paid or discharged  against all such Persons to exceed $5,000,000 during which a
stay of  enforcement  of such final  judgment  or order,  by reason of a pending
appeal or otherwise,  shall not be in effect; (g) a court having jurisdiction in
the  premises  enters a decree or order for (A) relief in respect of the Company
or any  significant  Subsidiary  in an  involuntary  case  under any  applicable
bankruptcy,  insolvency  or other  similar law now or hereafter  in effect,  (B)
appointment   of  a  receiver,   liquidator,   assignee,   custodian,   trustee,
sequestrator or similar  official of the Company or any  Significant  Subsidiary
for all or  substantially  all of the  property and assets of the Company or any
Significant  Subsidiary or (C) the winding up or  liquidation  of the affairs of
the Company or any  Significant  Subsidiary  and,  in each case,  such decree or
order shall remain  unstayed and in effect for a period of 60 consecutive  days;
or (h) the Company or any Significant  Subsidiary (A) commences a voluntary case
under  any  applicable  bankruptcy,  insolvency  or  other  similar  law  now or
hereafter  in  effect,  or  consents  to the  entry of an order of  relief in an
involuntary  case under any such law,  (B)  consents  to the  appointment  of or
taking  possession  by a receiver,  liquidator,  assignee,  custodian,  trustee,
sequestrator or similar  official of the Company or any  Significant  Subsidiary
for all or  substantially  all of the  property and assets of the Company or any
Significant  Subsidiary or (C) effects any general assignment for the benefit of
creditors.

      If an Event of Default (other than an Event of Default specified in clause
(g) or (h)  above  that  occurs  with  respect  to the  Company)  occurs  and is
continuing  under the  Indenture,  the Trustee or the Holders of at least 25% in
aggregate principal amount of the Notes, then outstanding,  by written notice to
the Company  (and to the Trustee if such notice is given by the  Holders),  may,
and the Trustee at the request of such Holders shall, declare the Accreted Value
of,  premium,  if  any,  and  accrued  interest,  if  any,  on the  Notes  to be
immediately due and payable.  If a bankruptcy or insolvency default with respect
to the  Company  or any  Restricted  Subsidiary  occurs and is  continuing,  the
Accreted Value of the Notes automatically  becomes due and payable.  Holders may
not enforce the Indenture or the Notes except as provided in the Indenture.  The
Trustee  may  require  indemnity  satisfactory  to it  before  it  enforces  the
Indenture or the Notes.  Subject to certain  limitations,  Holders of at least a
majority  in  principal  amount at maturity  of the Notes then  outstanding  may
direct the Trustee in its exercise of any trust or power.




                                     A-12

<PAGE>



      16.   SUBORDINATION.

      The payment of the Notes will,  to the extent set forth in the  Indenture,
be  subordinated  in right of payment to the prior  payment in full,  in cash or
cash equivalents, of all Senior Indebtedness.

      17.   TRUSTEE DEALINGS WITH COMPANY.

      The Trustee under the Indenture,  in its individual or any other capacity,
may make loans to, accept deposits from and perform  services for the Company or
its  Affiliates  and may otherwise deal with the Company or its Affiliates as if
it were not the Trustee;  PROVIDED,  HOWEVER,  that if the Trustee  acquires any
conflicting interest, it must eliminate such conflict or resign.

      18.   NO RECOURSE AGAINST OTHERS.

      No incorporator or any past, present or future partner, shareholder, other
equity holder, officer, director, employee or controlling person as such, of the
Company or of any successor  Person shall have any liability for any obligations
of the Company  under the Notes or the  Indenture  or for any claim based on, in
respect of or by reason of, such  obligations or their creation.  Each Holder by
accepting a Note waives and releases all such liability. Such waiver and release
are part of the consideration for the issuance of the Notes.

      19.   AUTHENTICATION.

      This Note shall not be valid  until the  Trustee or  Authenticating  Agent
signs the certificate of authentication on the other side of this Note.

      20.   ABBREVIATIONS.

      Customary  abbreviations  may  be  used  in the  name  of a  Holder  or an
assignee,  such as:  TEN COM (= tenants  in  common),  TEN ENT (= tenants by the
entireties),  JT TEN (= joint  tenants  with  right of  survivorship  and not as
tenants in common),  CUST (=  Custodian)  and U/G/M/A (= Uniform Gifts to Minors
Act).

      21.   REGISTRATION RIGHTS.

      In accordance with the terms of the  Registration  Rights  Agreement,  the
Company  has  agreed to use its best  efforts,  at its cost,  to cause to become
effective no later than one year after the Closing Date, the Shelf  Registration
Statement  with respect to the resale of the Conversion  Shares.  The Company is
required to use its best efforts,  at its cost, to maintain the effectiveness of
such Shelf Registration Statement until the earlier of (i) the expiration of the
time period  referred to in Rule 144(k) under the Securities Act with respect to




                                     A-13


<PAGE>


all beneficial holders other than affiliates of the Company of Conversion Shares
and  (ii)  such  time  as all  the  Conversion  Shares  covered  by  such  Shelf
Registration  Statement  have  been sold  pursuant  to such  Shelf  Registration
Statement or are  otherwise  freely  tradeable  without  registration  under the
Securities Act. During any consecutive 365-day period, the Company will have the
ability to suspend  availability of such Shelf Registration  Statement for up to
45 consecutive days (except for the consecutive  45-day period immediately prior
to the  maturity of the  Securities),  but no more than an  aggregate of 60 days
during any 365-day  period,  if the Company's  Board of Directors  determines in
good  faith  that  there  is  a  valid  purpose  for  the  suspension.  If  such
registration statement is not declared effective on or prior to the date that is
one year after the Closing Date, the denominator of the Conversion Ratio will be
decreased by $.15 (subject to adjustment as described in the Indenture).

      The  Registration  Rights  Agreement  contains  provisions  providing  for
indemnity and contribution with respect to such Shelf Registration  Statement to
the persons who are issued,  or the persons  (other than the Company) that sell,
Conversion  Shares  under  any  such  registration  statement.  Holders  of  the
Securities  will be able to convert their  Securities  only if the conversion of
the Securities is exempt from the  registration  requirements  of the Securities
Act, and such  securities  are qualified  for sale or exempt from  qualification
under the applicable  securities  laws of the states or other  jurisdictions  in
which the various holders of the Securities reside.

      22.   INDENTURE.

      Each  Holder,  by  accepting a Security,  agrees to be bound by all of the
terms and provisions of the  Indenture,  as the same may be amended from time to
time.  Capitalized  terms used herein and not defined  herein have the  meanings
ascribed thereto in the Indenture.

      The Company will  furnish to any Holder upon  written  request and without
charge a copy of the Indenture. Requests may be made to:

            International Fast Food Corporation
            1000 Lincoln Road
            Suite 200
            Miami Beach, FL  33139
            Attention: Jill Friedman, Administrative Assistant





                                     A-14


<PAGE>



                            FORM OF CONVERSION NOTICE

               (To be executed only upon conversion of this Note)

To: The Trustee  under the  Indenture  with  respect to the  Convertible  Senior
Subordinated  Discount Notes due 2007 of  International  Fast Food  Corporation,
dated as of          , 1997.

            The undersigned irrevocably converts Notes having a principal amount
at maturity  equal to $ ____ into shares of Common Stock of  International  Fast
Food  Corporation  (the "Company") on the terms and conditions  specified in the
Indenture herein referred to, and surrenders this Note and all right,  title and
interest  herein to the  Company  and  directs  that the shares of Common  Stock
deliverable upon the conversion of this Note be registered or placed in the name
and at the address specified below and delivered thereto.

Dated:                                    _________________________1/
                                          (Signature of Owner)

                                          ______________________________
                                          (Street Address)

                                          ______________________________
                                          (City)   (State)   (Zip Code)



Signature Guarantee: ___________________________________________________________
                     Participant in a recognized Signature Guarantee Medallion
                     Program (or other signature guarantor program reasonably
                     acceptable to the Registrar)


Common Stock and/or check to be issued to:

Name:
Street Address:
City, State and Zip Code:
Social security or identifying number:



________________

1/    The signature  must  correspond  with the name as written upon the face of
      this Note in every  particular,  without  alteration or enlargement or any
      change whatever.



                                       B-1


<PAGE>




                       OPTION OF HOLDER TO ELECT PURCHASE

      If you wish to have this  Security  purchased  by the Company  pursuant to
Section 5.10 or 5.15 of the Indenture, check the appropriate box:

                  Section 5.10  [   ]
                  Section 5.15  [   ]

      If you wish to have a portion of this  Security  purchased  by the Company
pursuant  to Section  5.10 or 5.15 of the  Indenture,  state the amount (in even
multiples of $1,000) you wish to have purchased:

US$_____________


Date:_______________________  Your Signature:___________________________________
                              (sign exactly as your name appears on the other
                               side of this Security)



Signature Guarantee: ___________________________________________________________
                     Participant in a recognized Signature Guarantee Medallion
                     Program (or other signature guarantor program reasonably
                     acceptable to the Registrar)














                                       B-2


<PAGE>
================================================================================






                                    EXHIBIT B

                                [Assignment Form]




























                                       B-1


<PAGE>



                                 ASSIGNMENT FORM

      To assign this  Security,  fill in the form below:  (I) or (we) assign and
transfer this Security to:

________________________________________________________________________________
                  (Insert assignee's soc. sec. or tax I.D. no.)

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________
              (Print or type assignee's name, address and zip code)


and irrevocably appoint_________________________________________________________
to transfer this Security on the books of the Company.  The agent may substitute
another to act for him.




Date: ______________          Your Signature:___________________________________
                                             (Sign exactly as your names appears
                                              on the face of this Security)


Signature Guarantee:
____________________________________________________________
                  Participant  in a  recognized  Signature  Guarantee  Medallion
                  Program  (or  other  signature  guarantor  program  reasonably
                  acceptable to the Registrar)













                                       B-2


<PAGE>


================================================================================


                                    EXHIBIT C

                       (Transfers to Accredited Investors)
































                                       C-1


<PAGE>




                          (Transfers to Accredited Investors)

                                                       ___________________, ____


BANKERS TRUST COMPANY, as Registrar
4 Albany Street
New York, New York  10006
Attention:  Corporate Trust and Agency Group


            Re:  International Fast Food Corporation
                 11% Convertible Senior Subordinated Discount Notes due 2007
                 -----------------------------------------------------------

Ladies and Gentlemen:

      In  connection  with  our  proposed  purchase  of 11%  Convertible  Senior
Subordinated  Discount Notes due 2007 (the  "Securities") of International  Fast
Food Corporation (the "Company"), we confirm that:

      1.    We  understand  that any  subsequent  transfer of the  Securities is
subject to certain  restrictions and conditions set forth in the Indenture dated
as of , 1997 relating to the Securities  (the  "Indenture")  and the undersigned
agrees to be bound by,  and not to  resell,  pledge or  otherwise  transfer  the
Securities  except in compliance with, such  restrictions and conditions and the
Securities Act of 1933, as amended (the "Securities Act").

      2.    We  understand  that the offer and sale of the  Securities  have not
been  registered  under the  Securities  Act, and that the Securities may not be
offered or sold except as permitted in the following sentence.  We agree, on our
own behalf and on behalf of any accounts for which we are acting as  hereinafter
stated,  that we will not,  within the time  period  referred  to in Rule 144(k)
under the  Securities Act as in effect on the date of transfer of this Security,
resell or otherwise transfer this Security except pursuant to an exemption from,
or in a  transaction  not  subject  to,  the  registration  requirements  of the
Securities  Act and we  further  agree to  provide  to any  person  to whom this
Security is transferred a notice  advising such  transferee  that resales of the
Securities are restricted as stated herein.

      3.    We understand  that, on any proposed  resale of any  Securities,  we
will be required to furnish to the Trustee, the Registrar and the Company,  such
certifications,  legal  opinions  and  other  information  as the  Trustee,  the
Registrar  and the Company may  reasonably  require to confirm that the proposed
sale complies with the foregoing restrictions.  We acknowledge that the Trustee,
the  Registrar  and the  Company  will rely upon the truth and  accuracy of such
information. We further understand that the Securities purchased by us will bear
a legend to the foregoing effect.



                                       C-2


<PAGE>




      4.    We are an "accredited investor" as defined in Rule 501 of Regulation
D under the Securities  Act) and have such knowledge and experience in financial
and business  matters as to be capable of evaluating the merits and risks of our
investment  in the  Securities,  and we and any accounts for which we are acting
are each able to bear the economic risk of our or their investment,  as the case
may be.

      5.    We are acquiring the  Securities  purchased by us for our account or
for one or more accounts (each of which is an "accredited  investor") as to each
of which we  exercise  sole  investment  discretion.  We are not  acquiring  the
Securities with a view toward  distribution  thereof in a transaction that would
violate the  Securities  Act or the  securities  laws of any State of the United
States or any other applicable jurisdiction.

            You,  the  Company  and the  Trustee  (as  defined in the  Indenture
relating  to the  Securities)  are  entitled  to rely upon this  letter  and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.

                                    Very truly yours,


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















                                       C-3


<PAGE>




                                   SCHEDULE I

                             (Existing Indebtedness)

Existing Indebtedness at November 5, 1997 consists of the following:

Amerbank in Poland, S.A.
  overdraft credit line, variable
  rate approximately equal to prime,
  expires March 31, 1998                                         $     50,000

Amerbank, IFFP line of credit of
  $950,000 payable in twenty nine
  installments of $32,000 commencing
  on March 31, 1998, interest payable
  monthly at 2.75% above  LIBOR, $22,000
  due at maturity on August 12, 2000.                                 950,000

Amerbank, PKP line of credit of
  $300,000 maturing on March 31, 1998,
  Interest payable monthly at Amerbank prime.                        *300,000

Amerbank revolving  credit facility,
  interest is payable monthly at 2.50%
  above  LIBOR,  $1,500,000  maximum
  credit until August 1999,  payable
  in thirty five monthly installments
  thereafter of $42,000 with final
  payment of $30,000 due at
  maturity on August 12, 2002.                                     *1,500,000

Totalbank line of credit of $999,000
  payable in full on May 19, 1998,
  interest  at 6.5% payable quarterly
  collateralized by certificates of
  deposit in the amount $999,990                                      999,000

Subordinated 9% debentures, due 2007                                2,756,000

                    Existing Indebtedness                      $    6,555,000
                                                                =============

* The Amerbank  revolving  facilities  for $1,500,000 and $300,000 have not been
drawn upon as of November 5, 1997.





                                       D-1


<PAGE>






================================================================================


                                   SCHEDULE II

                                (Existing Liens)



1.    Credit facility with Amerbank S.A. in the amount of $950,000 is secured by
      all existing restaurant assets of IFFP and is guaranteed by IFFC.

2.    Loan in the principal  amount of $1,500,000 is secured by the fixed assets
      of each new restaurant financed, and is guaranteed by IFFC.

3.    Promissory  Note in the amount of $1,000,000 is secured by certificates of
      deposit with interest due quarterly and principal due in May of 1998.

























                                       D-2


<PAGE>



================================================================================


                                  SCHEDULE III

                           [Form of CEO Certification]


      I, the undersigned, ___________________, being Chief Executive Officer (as
defined in the Indenture dated        , 1997) [if applicable insert - "and _____
[actual  title]"] of International  Fast Food  Corporation  (the "Company"),  do
hereby attest that: (a) to the best of my knowledge,  there are no  liabilities,
contingent  or  otherwise,  of  _____  [Name  of  Corporation]  and (b) the only
consideration  received by the  stockholders  of ______ [Name of Corporation] in
connection  with this merger  consists of the Common  Stock of the Company  (and
options,  warrants or other rights to purchase or acquire such Common Stock), in
the aggregate in an amount that does not exceed the amount thereof held by _____
[Name of Corporation]  immediately  prior to the merger of [Name of Corporation]
with and into the Company.

                                    INTERNATIONAL FAST FOOD CORPORATION



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