<PAGE>


                                                                  EXECUTION COPY
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                         LODGENET ENTERTAINMENT CORPORATION,
                                            as Issuer


                                         and


                                 MARINE MIDLAND BANK,
                                            as Trustee





                                 ____________________

                                      Indenture

                            Dated as of December 19, 1996

                                 ____________________


                            10 1/4% Senior Notes due 2006



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<PAGE>

                                CROSS-REFERENCE TABLE



TIA Sections                                                  Indenture Sections
------------                                                  ------------------

Section  310(a)(1) . . . . . . . . . . . . . . . . . .              7.10
            (a)(2). . . . . . . . . . . . . . . . . . .             7.10
            (b) . . . . . . . . . . . . . . . . . . . .             7.08
Section  313(c). . . . . . . . . . . . . . . . . . . .              7.06; 10.02
Section  314(a). . . . . . . . . . . . . . . . . . . .              4.18; 10.02
            (a)(4). . . . . . . . . . . . . . . . . . .             4.17; 10.02
            (c)(1). . . . . . . . . . . . . . . . . . .            10.03
            (c)(2). . . . . . . . . . . . . . . . . . .            10.03
            (e) . . . . . . . . . . . . . . . . . . . .            10.04
Section  315(b). . . . . . . . . . . . . . . . . . . .              7.05; 10.02
Section  316(a)(1)(A). . . . . . . . . . . . . . . . .              6.05
            (a)(1)(B) . . . . . . . . . . . . . . . . .             6.04
            (b) . . . . . . . . . . . . . . . . . . . .             6.07
Section  317(a)(1) . . . . . . . . . . . . . . . . . .              6.08
            (a)(2). . . . . . . . . . . . . . . . . . .             6.09
Section  318(a). . . . . . . . . . . . . . . . . . . .             10.01
            (c) . . . . . . . . . . . . . . . . . . . .            10.01

Note:      The Cross-Reference Table shall not for any purpose be deemed to be
           a part of the Indenture.

<PAGE>

                                  TABLE OF CONTENTS
                                                                            Page
                                                                            ----

                                     ARTICLE ONE
                      DEFINITIONS AND INCORPORATION BY REFERENCE

    SECTION 1.01.  Definitions..............................................  1
    SECTION 1.02.  Incorporation by Reference of Trust Indenture Act........ 21
    SECTION 1.03.  Rules of Construction.................................... 21

                                     ARTICLE TWO
                                      THE NOTES

    SECTION 2.01.  Form and Dating.......................................... 22
    SECTION 2.02.  Restrictive Legends...................................... 23
    SECTION 2.03.  Execution, Authentication and Denominations.............. 25
    SECTION 2.04.  Registrar and Paying Agent............................... 26
    SECTION 2.05.  Paying Agent to Hold Money in Trust...................... 27
    SECTION 2.06.  Transfer and Exchange.................................... 27
    SECTION 2.07.  Book-Entry Provisions for Global Notes................... 28
    SECTION 2.08.  Special Transfer Provisions.............................. 30
    SECTION 2.09.  Replacement Notes........................................ 33
    SECTION 2.10.  Outstanding Notes........................................ 33
    SECTION 2.11.  Temporary Notes.......................................... 34
    SECTION 2.12.  Cancellation............................................. 34
    SECTION 2.13.  CUSIP Numbers............................................ 35
    SECTION 2.14.  Defaulted Interest....................................... 35

                                    ARTICLE THREE
                                      REDEMPTION

    SECTION 3.01.  Right of Redemption...................................... 35
    SECTION 3.02.  Notices to Trustee....................................... 36
    SECTION 3.03.  Selection of Notes to Be Redeemed........................ 36
    SECTION 3.04.  Notice of Redemption..................................... 36
    SECTION 3.05.  Effect of Notice of Redemption........................... 37
    SECTION 3.06.  Deposit of Redemption Price.............................. 37
    SECTION 3.07.  Payment of Notes Called for Redemption................... 38
    SECTION 3.08.  Notes Redeemed in Part................................... 38

_________________________
Note:    The Table of Contents shall not for any purposes be deemed to be a
         part of the Indenture.

<PAGE>

                                          ii

                                     ARTICLE FOUR
                                      COVENANTS

    SECTION 4.01.  Payment of Notes......................................... 38
    SECTION 4.02.  Maintenance of Office or Agency.......................... 39
    SECTION 4.03.  Limitation on Indebtedness............................... 39
    SECTION 4.04.  Limitation on Restricted Payments........................ 41
    SECTION 4.05.  Limitation on Dividend and Other Payment Restrictions
                   Affecting Restricted Subsidiaries........................ 43
    SECTION 4.06.  Limitation on the Issuance and Sale of Capital Stock of
                   Restricted Subsidiaries.................................. 44
    SECTION 4.07.  Limitation on Issuances of Guarantees by Restricted
                   Subsidiaries............................................. 44
    SECTION 4.08.  Limitation on Transactions with Stockholders
                   and Affiliates........................................... 45
    SECTION 4.09.  Limitation on Liens...................................... 46
    SECTION 4.10.  Limitation on Sale-Leaseback Transactions................ 46
    SECTION 4.11.  Limitation on Asset Sales................................ 47
    SECTION 4.12.  Repurchase of Notes upon a Change of Control............. 48
    SECTION 4.13.  Existence................................................ 48
    SECTION 4.14.  Payment of Taxes and Other Claims........................ 48
    SECTION 4.15.  Maintenance of Properties and Insurance.................. 48
    SECTION 4.16.  Notice of Defaults....................................... 49
    SECTION 4.17.  Compliance Certificates.................................. 49
    SECTION 4.18.  Commission Reports and Reports to Holders................ 50
    SECTION 4.19.  Waiver of Stay, Extension or Usury Laws.................. 50

                                     ARTICLE FIVE
                                SUCCESSOR CORPORATION

    SECTION 5.01.  When Company May Merge, Etc.............................. 50
    SECTION 5.02.  Successor Substituted.................................... 51

                                     ARTICLE SIX
                                 DEFAULT AND REMEDIES

    SECTION 6.01.  Events of Default........................................ 51
    SECTION 6.02.  Acceleration............................................. 53
    SECTION 6.03.  Other Remedies........................................... 54
    SECTION 6.04.  Waiver of Past Defaults.................................. 54
    SECTION 6.05.  Control by Majority...................................... 54
    SECTION 6.06.  Limitation on Suits...................................... 54
    SECTION 6.07.  Rights of Holders to Receive Payment..................... 55
    SECTION 6.08.  Collection Suit by Trustee............................... 55

<PAGE>

                                         iii

    SECTION 6.09.  Trustee May File Proofs of Claim......................... 56
    SECTION 6.10.  Priorities............................................... 56
    SECTION 6.11.  Undertaking for Costs.................................... 56
    SECTION 6.12.  Restoration of Rights and Remedies....................... 57
    SECTION 6.13.  Rights and Remedies Cumulative........................... 57
    SECTION 6.14.  Delay or Omission Not Waiver............................. 57

                                    ARTICLE SEVEN
                                       TRUSTEE

    SECTION 7.01.  General.................................................. 58
    SECTION 7.02.  Certain Rights of Trustee................................ 59
    SECTION 7.03.  Individual Rights of Trustee............................. 60
    SECTION 7.04.  Trustee's Disclaimer..................................... 60
    SECTION 7.05.  Notice of Default........................................ 60
    SECTION 7.06.  Reports by Trustee to Holders............................ 60
    SECTION 7.07.  Compensation and Indemnity............................... 60
    SECTION 7.08.  Replacement of Trustee................................... 61
    SECTION 7.09.  Successor Trustee by Merger, Etc......................... 62
    SECTION 7.10.  Eligibility.............................................. 62
    SECTION 7.11.  Money Held in Trust...................................... 62
    SECTION 7.12.  Withholding Taxes........................................ 63

                                    ARTICLE EIGHT
                                DISCHARGE OF INDENTURE

    SECTION 8.01.  Termination of Company's Obligations..................... 63
    SECTION 8.02.  Defeasance and Discharge of Indenture.................... 64
    SECTION 8.03.  Defeasance of Certain Obligations........................ 66
    SECTION 8.04.  Application of Trust Money............................... 68
    SECTION 8.05.  Repayment to Company..................................... 68
    SECTION 8.06.  Reinstatement............................................ 68

                                     ARTICLE NINE
                         AMENDMENTS, SUPPLEMENTS AND WAIVERS

    SECTION 9.01.  Without Consent of Holders............................... 69
    SECTION 9.02.  With Consent of Holders.................................. 69
    SECTION 9.03.  Revocation and Effect of Consent......................... 70
    SECTION 9.04.  Notation on or Exchange of Notes......................... 71
    SECTION 9.05.  Trustee to Sign Amendments, Etc.......................... 71
    SECTION 9.06.  Conformity with Trust Indenture Act...................... 71

<PAGE>

                                          iv

                                     ARTICLE TEN
                                    MISCELLANEOUS

    SECTION 10.01.  Trust Indenture Act of 1939............................. 72
    SECTION 10.02.  Notices................................................. 72
    SECTION 10.03.  Certificate and Opinion as to Conditions Precedent...... 73
    SECTION 10.04.  Statements Required in Certificate or Opinion........... 73
    SECTION 10.05.  Rules by Trustee, Paying Agent or Registrar............. 73
    SECTION 10.06.  Payment Date Other Than a Business Day.................. 74
    SECTION 10.07.  Governing Law........................................... 74
    SECTION 10.08.  No Adverse Interpretation of Other Agreements........... 74
    SECTION 10.09.  No Recourse Against Others.............................. 74
    SECTION 10.10.  Successors.............................................. 74
    SECTION 10.11.  Duplicate Originals..................................... 74
    SECTION 10.12.  Separability............................................ 75
    SECTION 10.13.  Table of Contents, Headings, Etc........................ 75

<PAGE>

EXHIBIT A   Form of Note....................................................A-1
EXHIBIT B   Form of Certificate.............................................B-1
EXHIBIT C   Form of Certificate to be Delivered in Connection with
                   Transfers Pursuant to Non-QIB Accredited Investors.......C-1
EXHIBIT D   Form of Certificate to be Delivered in Connection with
                   Transfers Pursuant to Regulation S.......................D-1

<PAGE>

         INDENTURE, dated as of December 19, 1996, between LODGENET
ENTERTAINMENT CORPORATION, a Delaware corporation (the "COMPANY"), and MARINE
MIDLAND BANK, a New York banking corporation and trust company, as Trustee (the
"TRUSTEE").


                                       RECITALS

         The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance of up to $150,000,000 aggregate principal
amount of the Company's 10 1/4% Senior Notes due 2006 (the "NOTES") issuable as
provided in this Indenture.  All things necessary to make this Indenture a valid
agreement of the Company, in accordance with its terms, have been done, and the
Company has done all things necessary to make the Notes, when executed by the
Company and authenticated and delivered by the Trustee hereunder and duly issued
by the Company, the valid obligations of the Company as hereinafter provided.

         This Indenture is subject to, and shall be governed by, the provisions
of the Trust Indenture Act of 1939, that are required to be a part of and to
govern indentures qualified under the Trust Indenture Act of 1939.

                        AND THIS INDENTURE FURTHER WITNESSETH

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


                                     ARTICLE ONE
                      DEFINITIONS AND INCORPORATION BY REFERENCE

         SECTION 1.01.  DEFINITIONS.

         "Acquired Indebtedness" means Indebtedness of a Person existing at the
time such Person becomes a Restricted Subsidiary or assumed in connection with
an Asset Acquisition by a Restricted Subsidiary and not Incurred in connection
with, or in anticipation of, such Person becoming a Restricted Subsidiary or
such Asset Acquisition; PROVIDED that Indebtedness of such Person which is
redeemed, defeased, retired or otherwise repaid at the time of or immediately
upon consummation of the transactions by which such Person becomes a Restricted
Subsidiary or such Asset Acquisition shall not be Acquired Indebtedness.

         "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

<PAGE>

                                          2


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 or such Unrestricted Subsidiary during such 
period; (ii) solely for the purposes of calculating the amount of Restricted 
Payments that may be made pursuant to clause (C) of the first paragraph of 
Section 4.04 (and in such case, except to the extent includable pursuant to 
clause (i) above), the net income (or loss) of any Person accrued prior to 
the date it becomes a Restricted Subsidiary or is merged into or consolidated 
with the Company or any of its Restricted Subsidiaries or all or 
substantially all of the property and assets of such Person are acquired by 
the Company or any of its Restricted Subsidiaries; (iii) solely for the 
purposes of calculating the amount of Restricted Payments that may be made 
pursuant to clause (C) of the first paragraph of Section 4.04, the net income 
of any Restricted Subsidiary 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; (iv) any 
gains or losses (on an after-tax basis) attributable to Asset Sales; (v) 
except for purposes of calculating the amount of Restricted Payments that may 
be made pursuant to clause (C) of the first paragraph of Section 4.04, any 
amount paid or accrued as 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 (vi) all extraordinary gains and extraordinary 
losses.

         "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
intangibles, all as set forth on the most recent quarterly or annual
consolidated balance sheet of the Company and its Restricted Subsidiaries,
prepared in conformity with GAAP and filed with the Commission pursuant to
Section 4.18.

         "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, with 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

<PAGE>

                                          3

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.

         "Agent Members" has the meaning provided in Section 2.07(a).

         "Asset Acquisition" means (i) an investment by the Company or any of
its Restricted Subsidiaries in any other Person pursuant to which such Person
shall become a Restricted Subsidiary or shall be merged into or consolidated
with the Company or any of its Restricted Subsidiaries; PROVIDED that such
Person's primary business is related, ancillary or complementary to the
businesses of the Company and its Restricted Subsidiaries on the date of such
investment or (ii) an acquisition by the Company or any of its Restricted
Subsidiaries of the property and assets of any Person other than the Company or
any of its Restricted Subsidiaries that constitute substantially all of a
division or line of business of such Person; PROVIDED that the property and
assets acquired are related, ancillary or complementary to the businesses of the
Company and its Restricted Subsidiaries on the date of such acquisition.

         "Asset Disposition" means the sale or other disposition by the Company
or any of its Restricted Subsidiaries (other than to the Company or another
Restricted Subsidiary) of (i) all or substantially all of the Capital Stock of
any Restricted Subsidiary of the Company or (ii) all or substantially all of the
assets that constitute a division or line of business of the Company or any of
its Restricted Subsidiaries.

         "Asset Sale" means any sale, transfer or other disposition (including
by way of merger, consolidation or sale-leaseback transaction) 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 and assets of the Company or any of its Restricted
Subsidiaries (other than the Capital Stock or assets of an Unrestricted
Subsidiary) outside the ordinary course of business of the Company or such
Restricted Subsidiary and, in each case, that is not governed by Article Five;
PROVIDED that "Asset Sale" shall not include (a) sales or other dispositions of
inventory, receivables and other current, obsolete or worn out assets, (b) sales
or other dispositions of assets for consideration at least equal to the fair
market value of the assets sold or disposed of, provided that the consideration
received would satisfy clause (B) of Section 4.11 or (c) issuances or sales of
Common Stock of ResNet pursuant to the ResNet Transaction Documents.

<PAGE>

                                          4


         "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.

         "Board of Directors" means the Board of Directors of the Company or
any committee of such Board of Directors duly authorized to act under this
Indenture.

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

         "Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in the City of New York, or in the city of the Corporate
Trust Office of the Trustee, are authorized by law to close.

         "Capital Stock" means, with respect to any Person, any and all shares,
interests, memberships, participations or other equivalents (however designated,
whether voting or non-voting) in equity of such Person, whether now outstanding
or issued after the Closing Date, 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 (i) (a) a "person" or "group"
(within the meaning of Sections 13(d) or 14(d)(2) of the Exchange Act) other
than the Permitted Holders becomes the ultimate "beneficial owner" (as defined
in Rule 13d-3 of the Exchange Act) of Voting Stock representing more than 40% of
the total voting power of the total Voting Stock of the Company on a fully
diluted basis and (b) such person or group beneficially owns more Voting Stock
than the Permitted Holders; or (ii) individuals who at the beginning of any 24
month period constitute the Board of Directors (together with any new directors
whose election by the Board of Directors or whose nomination for election by the
Company's stockholders was approved by a vote of at least two-thirds of the
members of the Board of Directors then in office who either were members of the
Board of Directors on the Closing Date or whose election or nomination for
election was previously so approved) cease for any reason during such 24 month
period to constitute a majority of the members of the Board of Directors then in
office.

<PAGE>

                                          5


         "Closing Date" means the date on which the Notes are originally issued
under this Indenture.

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

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

         "Company" means the party named as such in the first paragraph of this
Indenture until a successor replaces it pursuant to Article Five of this
Indenture and thereafter means the successor.

         "Company Order" means a written request or order signed in the name of
the Company (i) by its Chairman, a Vice Chairman, its President or a Vice
President and (ii) by its Treasurer, an Assistant Treasurer, its Secretary or an
Assistant Secretary and delivered to the Trustee; PROVIDED, HOWEVER, that such
written request or order may be signed by any two of the officers or directors
listed in clause (i) above in lieu of being signed by one of such officers or
directors listed in such clause (i) and one of the officers listed in clause
(ii) above.

         "Consolidated EBITDA" means, for any period, the sum of the amounts
for such period of (i) Adjusted Consolidated Net Income, (ii) Consolidated
Interest Expense, to the extent such amount was deducted in calculating Adjusted
Consolidated Net Income, (iii) income taxes, to the extent such amount was
deducted in calculating Adjusted Consolidated Net Income (other than income
taxes (either positive or negative) attributable to extraordinary and
non-recurring gains or losses or sales of assets), (iv) depreciation expense, to
the extent such amount was deducted in calculating Adjusted Consolidated Net
Income, (v) amortization expense, to the extent such amount was deducted in
calculating Adjusted Consolidated Net Income, and (vi) all other non-cash items
reducing Adjusted Consolidated Net Income (other than items that will require
cash payments and for which an accrual or reserve is, or is required by GAAP to
be, made), less all non-cash items increasing Adjusted Consolidated Net Income,
all as determined on a consolidated basis for the Company and its Restricted
Subsidiaries in conformity with GAAP; PROVIDED that, Consolidated EBITDA will
not be reduced as a result of a minority interest in the net income of a
Restricted Subsidiary except to the extent that dividends in cash or other
distributions of cash, property, or other assets (other than dividends or
distributions payable solely in shares of Capital Stock) are actually paid to
the holders of such minority interest.

<PAGE>

                                          6


         "Consolidated Fixed Charges" means, for any period, the aggregate
amount of (i) interest in respect of Indebtedness (including, without
limitation, 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), (ii) all but the principal component of rentals in
respect of Capitalized Lease Obligations paid, accrued or scheduled to be paid
or to be accrued by the Company and its Restricted Subsidiaries during such
period and (iii) one-third of rental expense attributable to all leases other
than Capitalized Leases; EXCLUDING, HOWEVER, (i) any amount of such interest of
any Restricted Subsidiary if the net income of such Restricted Subsidiary is
excluded in the calculation of Adjusted Consolidated Net Income pursuant to
clause (iii) of the definition thereof (but only in the same proportion as the
net income of such Restricted Subsidiary is excluded from the calculation of
Adjusted Consolidated Net Income pursuant to clause (iii) of the definition
thereof) and (ii) any premiums, fees and expenses (and any amortization thereof)
payable in connection with the offering of the Notes, all as determined on a
consolidated basis (without taking into account Unrestricted Subsidiaries) in
conformity with GAAP.

         "Consolidated Interest Expense" means, for any period, the aggregate
amount of (i) interest in respect of Indebtedness (including, without
limitation, 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 (ii) all but the principal component of rentals in
respect of Capitalized Lease Obligations paid, accrued or scheduled to be paid
or to be accrued by the Company and its Restricted Subsidiaries during such
period; EXCLUDING, HOWEVER, (i) any amount of such interest of any Restricted
Subsidiary if the net income of such Restricted Subsidiary is excluded in the
calculation of Adjusted Consolidated Net Income pursuant to clause (iii) of the
definition thereof (but only in the same proportion as the net income of such
Restricted Subsidiary is excluded from the calculation of Adjusted Consolidated
Net Income pursuant to clause (iii) of the definition thereof) and (ii) any
premiums, fees and expenses (and any amortization thereof) payable in connection
with the offering of the Notes, all as determined on a consolidated basis
(without taking into account Unrestricted Subsidiaries) in conformity with GAAP.

         "Consolidated Leverage Ratio" means, on any Transaction Date, the
ratio of (i) the aggregate amount of Indebtedness of the Company and its
Restricted Subsidiaries on a consolidated basis as at such Transaction Date to
(ii) the aggregate amount of Consolidated

<PAGE>

                                          7

EBITDA for the two most recent fiscal quarters prior to such Transaction Date
for which financial statements of the Company have been filed with the
Commission pursuant to Section 4.18 (such two fiscal quarter periods being the
"Two Quarter Period"), multiplied by two; PROVIDED that (A) PRO FORMA effect
shall be given to (x) any Indebtedness Incurred from the beginning of the Two
Quarter Period through the Transaction Date (the "Reference Period"), to the
extent such Indebtedness is outstanding on the Transaction Date and (y) any
Indebtedness that was outstanding during such Reference Period but that is not
outstanding or is to be repaid on the Transaction Date; (B) PRO FORMA effect
shall be given to Asset Dispositions and Asset Acquisitions (including PRO FORMA
effect to the application of proceeds of any Asset Disposition) that occur
during such Reference Period; and (C) PRO FORMA effect shall be given to asset
dispositions and asset acquisitions (including giving pro forma effect to the
application of proceeds of any asset disposition) that have been made by any
Person that has become a Restricted Subsidiary or has been merged with or into
the Company or any Restricted Subsidiary during such Reference Period and that
would have constituted Asset Dispositions or Asset Acquisitions had such
transactions occurred when such Person was a Restricted Subsidiary as if such
asset dispositions or asset acquisitions were Asset Dispositions or Asset
Acquisitions that occurred on the first day of such Reference Period; provided
that to the extent that clause (B) or (C) of this sentence requires that PRO
FORMA effect be given to an Asset Acquisition or Asset Disposition, such PRO
FORMA calculation shall be based upon the two full fiscal quarters immediately
preceding the Transaction Date of the Person, or division or line of business of
the Person, that is acquired or disposed of for which financial information is
available, multiplied by two as provided in clause (i) above.

         "Corporate Trust Office" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date of this Indenture,
located at 140 Broadway, New York, New York 10005, Attention: Corporate Trust
Administration Department.

         "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 a
beneficiary thereafter.

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

         "Depositary" shall mean The Depository Trust Company, its nominees,
and their respective successors.

         "Event of Default" has the meaning provided in Section 6.01.

<PAGE>

                                          8


         "Excess Proceeds" has the meaning provided in Section 4.11.

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

         "Exchange Notes" means any securities of the Company containing terms
identical to the Notes (except that such Exchange Notes (i) shall be registered
under the Securities Act and (ii) shall have an interest rate equal to 10 1/4%
per annum, without provision for adjustment as provided in the fourth paragraph
of Section 1 of the Notes) that are issued and exchanged for the Notes pursuant
to the Registration Rights Agreement and this Indenture.

         "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 determination shall
be conclusive if evidenced by a Board Resolution.

         "GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the Closing Date, including, without
limitation, 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 or referred
to in this Indenture shall be computed in conformity with GAAP applied on a
consistent basis, except that calculations made for purposes of determining
compliance with the terms of the covenants and with other provisions of this
Indenture shall be made without giving effect to (i) the amortization of any
expenses incurred in connection with the offering of the Notes and (ii) except
as otherwise provided, the amortization of any amounts required or permitted by
Accounting Principles Board Opinion Nos. 16 and 17.

         "Global Notes" has the meaning provided in Section 2.01.

         "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

<PAGE>

                                          9

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.

         "Guaranteed Indebtedness" has the meaning provided in Section 4.07.

         "Holder" or "Securityholder" means the registered holder of any Note.

         "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 an "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), (i) all indebtedness of such Person for
borrowed money, (ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (iii) all obligations of such
Person in respect of letters of credit or other similar instruments (including
reimbursement obligations with respect thereto, but excluding obligations with
respect to letters of credit (including trade letters of credit) securing
obligations (other than obligations described in (i) or (ii) above or (v), (vi)
or (vii) below) entered into in the ordinary course of business of such Person
to the extent such letters of credit are not drawn upon or, if drawn upon, to
the extent such drawing is reimbursed no later than the third Business Day
following receipt by such Person of a demand for reimbursement), (iv) all
obligations of such Person to pay the deferred and unpaid purchase price of
property or services, which purchase price is due more than six months after the
date of placing such property in service or taking delivery and title thereto or
the completion of such services, except Trade Payables, (v) all obligations of
such Person as lessee under Capitalized Leases, (vi) all Indebtedness of other
Persons secured by a Lien on any asset of such Person, whether or not such
Indebtedness is assumed by such Person; PROVIDED that the amount of such
Indebtedness shall be the lesser of (A) the fair market value of such asset at
such date of determination and (B) the amount of such Indebtedness, (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, 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 less the
unamortized portion of the original issue discount of such Indebtedness at the
time of its issuance as determined in conformity with GAAP, (B) that
Indebtedness shall not include any liability for federal, state, local or

<PAGE>

                                          10

other taxes and (C) that Indebtedness shall not include any obligations owed to
TCI Satellite that do not provide for or permit payments in cash and that may
only be repaid or satisfied through the issuance of Common Stock of ResNet.

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

         "Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.

         "Interest Payment Date" means each semiannual interest payment date on
June 15 and December 15 of each year, commencing June 15, 1997.

         "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 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 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 (or any other Investment), held
by the Company or any of its Restricted Subsidiaries, of (or in) any Person that
has ceased to be a Restricted Subsidiary, including without limitation, by
reason of any transaction permitted by clause (iii) or clause (iv) of Section
4.06.  For purposes of the definition of "Unrestricted Subsidiary" set forth
herein and Section 4.04, (i) "Investment" shall include the fair market value of
the assets (net of liabilities (other than liabilities to the Company or any of
its Subsidiaries)) of any Restricted Subsidiary at the time that such Restricted
Subsidiary is designated an Unrestricted Subsidiary, (ii) the fair market value
of the assets (net of liabilities (other than liabilities to the Company or any
of its Subsidiaries)) of any Unrestricted Subsidiary at the time that such
Unrestricted Subsidiary is designated a Restricted Subsidiary shall be
considered a reduction

<PAGE>

                                          11

in outstanding Investments and (iii) any property transferred to or from an
Unrestricted Subsidiary shall be valued at its fair market value at the time of
such transfer.

         "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 or any
agreement to give any security interest).

         "Moody's" means Moody's Investors Service, Inc. and its successors.

         "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 (except to the extent such obligations are financed
or sold with recourse to the Company or any Restricted Subsidiary) and proceeds
from the conversion of other property received when converted to cash or cash
equivalents, net of (i) 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 (whether or not such taxes 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 amounts to be provided by the
Company or any Restricted Subsidiary of the Company as a 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 (except to the extent such obligations are financed or
sold with recourse to the Company or any Restricted Subsidiary of the Company)
and proceeds from the conversion of other property received when converted to
cash or cash equivalents, net of 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 Credit Facility" means the credit agreement dated as of December
19, 1996 among the Company, its Subsidiaries named therein, the lenders named
therein and National Westminster Bank Plc, as agent, together with all other
agreements, instruments and documents executed or delivered pursuant thereto or
in connection therewith, in each case as

<PAGE>

                                          12

such agreements, instruments or documents may be amended, supplemented,
extended, renewed, replaced or otherwise modified from time to time (including
increases in the principal amount thereof); PROVIDED that, with respect to any
agreement providing for the refinancing of Indebtedness under the New Credit
Facility, such agreement shall be the New Credit Facility under the Indenture
only if a notice to that effect is delivered by the Company to the Trustee and
there shall be at any time only one instrument that is (together with the
aforementioned related agreements, instruments and documents) the New Credit
Facility under the Indenture.

         "Notes" means any of the securities, as defined in the first paragraph
of the recitals hereof, that are authenticated and delivered under this
Indenture.  For all purposes of this Indenture, the term "Notes" shall include
any Exchange Notes to be issued and exchanged for any Notes pursuant to the
Registration Rights Agreement and this Indenture and, for purposes of this
Indenture, all Notes and Exchange Notes shall vote together as one series of
Notes under this Indenture.

         "Non-U.S. Person" means a person who is not a U.S. person, as defined
in Regulation S.

         "Offer to Purchase" means an offer to purchase Notes by the Company
from the Holders commenced by mailing a notice to the Trustee and each Holder
stating:  (i) the covenant of this Indenture pursuant to which the offer is
being made and that all Notes validly tendered will be accepted for payment on a
pro rata basis; (ii) the purchase price and the date of purchase (which shall be
a Business Day no earlier than 30 days nor later than 60 days from the date such
notice is mailed) (the "Payment Date"); (iii) that any Note not tendered will
continue to accrue interest pursuant to its terms; (iv) that, unless the Company
defaults in the payment of the purchase price, any Note accepted for payment
pursuant to the Offer to Purchase shall cease to accrue interest on and after
the Payment Date; (v) that Holders electing to have a Note purchased pursuant to
the Offer to Purchase will be required to surrender the Note, together with the
form entitled "Option of the Holder to Elect Purchase" on the reverse side of
the Note 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; (vi) that Holders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the third
Business Day immediately preceding the Payment Date, a telegram, facsimile
transmission or letter setting forth the name of such Holder, the principal
amount of Notes delivered for purchase and a statement that such Holder is
withdrawing his election to have such Notes purchased; and (vii) that Holders
whose Notes are being purchased only in part will be issued new Notes equal in
principal amount to the unpurchased portion of the Notes surrendered; PROVIDED
that each Note purchased and each new Note issued shall be in a principal amount
of $1,000 or integral multiples thereof.  On the Payment Date, the Company shall
(i) accept for payment on a pro rata basis Notes or portions thereof tendered
pursuant to an Offer to Purchase;

<PAGE>

                                          13

(ii) deposit with the Paying Agent money sufficient to pay the purchase price of
all Notes or portions thereof so accepted; and (iii) deliver, or cause to be
delivered, to the Trustee all Notes or portions thereof so accepted together
with an Officers' Certificate specifying the Notes or portions thereof accepted
for payment by the Company.  The Paying Agent shall promptly mail to the Holders
of Notes so accepted payment in an amount equal to the purchase price, and the
Company shall issue, and the Trustee shall promptly authenticate and mail to
such Holders, a new Note equal in principal amount to any unpurchased portion of
the Note surrendered; PROVIDED that each Note purchased and each new Note issued
shall be in a principal amount of $1,000 or integral multiples thereof.  The
Company will publicly announce the results of an Offer to Purchase as soon as
practicable after the Payment Date.  The Trustee shall act as the Paying Agent
for an Offer to Purchase.  The Company will comply with 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 the event that the Company
is required to repurchase Notes pursuant to an Offer to Purchase.

         "Officer" means, with respect to the Company, (i) the Chairman of the
Board, the President, the Chief Operating Officer, any Vice President, the Chief
Financial Officer, and (ii) the Treasurer or any Assistant Treasurer, or the
Secretary or any Assistant Secretary.

         "Officers' Certificate" means a certificate signed by one Officer
listed in clause (i) of the definition thereof and one Officer listed in clause
(ii) of the definition thereof, which certificate shall comply with the
provisions of Section 10.04 hereof.  Any Officers' Certificate delivered
pursuant to the first paragraph of Section 4.17 hereof shall be signed by the
Chief Executive Officer, the Chief Operating Officer, the Chief Financial
Officer or the Chief Accounting Officer of the Company.  Each Officers'
Certificate (other than certificates provided pursuant to TIA Section 314(a)(4))
shall include the statements provided for in TIA Section 314(e).

         "Offshore Global Note" has the meaning provided in Section 2.01.

         "Offshore Physical Notes" has the meaning provided in Section 2.01.

         "Opinion of Counsel" means a written opinion signed by legal counsel
who may be an employee of or counsel to the Company, which opinion shall comply
with Section 10.04 hereof.  Each such Opinion of Counsel shall include the
statements provided for in TIA Section 314(e).

         "Paying Agent" has the meaning provided in Section 2.04, except that,
for the purposes of Article Eight, the Paying Agent shall not be the Company or
a Subsidiary of the Company or an Affiliate of any of them.  The term "Paying
Agent" includes any additional Paying Agent.

<PAGE>

                                          14


         "Permitted Holders" means, collectively, the executive officers of the
Company and ResNet as of the Closing Date, any Restricted Subsidiary and trusts
established under any employee stock ownership plan that is solely for the
benefit of the employees of the Company and its Subsidiaries.

         "Permitted Investment" means (i) an Investment in the Company or 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; PROVIDED that such person's primary business is
related, ancillary or complementary to the businesses of the Company and its
Restricted Subsidiaries on the date of such Investment; (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; and (iv) stock, obligations or securities received in
satisfaction of judgments.

         "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 and 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); (v) easements, 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) Liens (including extensions and renewals thereof) upon real or personal
(whether tangible or intangible) property acquired after the Closing Date or
associated with the Company's headquarter offices; PROVIDED that (a) such Lien
is created solely for the purpose of securing Indebtedness Incurred, in
accordance with Section 4.03, (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 six 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

<PAGE>

                                          15

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 such item; (vii) 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; (viii) Liens encumbering property
or assets under construction arising from progress or partial payments by a
customer of the Company or its Restricted Subsidiaries relating to such property
or assets; (ix) any interest or title of a lessor in the property subject to any
Capitalized Lease or operating lease; (x) Liens arising from filing Uniform
Commercial Code financing statements regarding leases; (xi) Liens on property
of, or on shares of  Capital Stock or Indebtedness of, any Person existing at
the time such Person 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;
(xii) Liens in favor of the Company or any Restricted Subsidiary; (xiii) 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; (xiv) 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; (xv) 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; (xvi) 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, securing Indebtedness under Interest
Rate Agreements and Currency Agreements and forward contracts, options, future
contracts, futures options or similar agreements or arrangements designed solely
to protect the Company or any of its Restricted Subsidiaries from fluctuations
in interest rates, currencies or the price of commodities; (xvii) 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; (xviii) Liens on or sales of receivables; and (xix) Liens securing
Indebtedness in an amount not to exceed $5 million.

         "Person" means an individual, a corporation, a partnership, a limited
liability company, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.

         "Physical Notes" has the meaning provided in Section 2.01.

         "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

<PAGE>

                                          16

after the date of this Indenture, including, without limitation, all series and
classes of such preferred or preference stock.

         "principal" of a debt security, including the Notes, means the
principal amount due on the Stated Maturity as shown on such debt security.

         "Private Placement Legend" means the legend initially set forth on the
Notes in the form set forth in Section 2.02.

         "Public Equity Offering" means an underwritten primary public offering
of Common Stock of the Company pursuant to an effective registration statement
under the Securities Act.

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

         "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 Notes, (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 Notes 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 Notes; PROVIDED that any Capital
Stock that would not constitute Redeemable Stock but for provisions thereof
giving holders thereof the right to require such Person to repurchase or redeem
such Capital Stock upon the occurrence of an "asset sale" or "change of control"
occurring prior to the Stated Maturity of the Notes shall not constitute
Redeemable Stock if the "asset sale" or "change of control" provisions
applicable to such Capital Stock are no more favorable to the holders of such
Capital Stock than the provisions contained in Sections 4.11 and 4.12 and such
Capital Stock specifically provides that such Person will not repurchase or
redeem any such stock pursuant to such provision prior to the Company's
repurchase of such Notes as are required to be repurchased pursuant to Sections
4.11 and 4.12.

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

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

         "Registrar" has the meaning provided in Section 2.04.

         "Registration Rights Agreement" means the Registration Rights
Agreement, dated as of December 16, 1996, between the Company and Morgan Stanley
& Co.

<PAGE>

                                          17

Incorporated, NatWest Capital Markets Limited and Montgomery Securities, and
certain permitted assigns specified therein.

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

         "Regular Record Date" for the interest payable on any Interest Payment
Date means the June 1 or December 1 (whether or not a Business Day), as the case
may be, next preceding such Interest Payment Date.

         "Regulation D" means Regulation D under the Securities Act.

         "Regulation S" means Regulation S under the Securities Act.

         "ResNet" means ResNet Communications, Inc., a subsidiary of the
Company, and its successors, including, without limitation, its successor to be
formed upon reconstitution of ResNet as a Delaware limited liability company in
connection with the recapitalization of ResNet contemplated by the ResNet
Transaction Documents.

         "ResNet Transaction Documents" means the agreements among the Company,
ResNet and TCI Satellite setting forth, among other things, the terms and
conditions of TCI Satellite's investment in ResNet, as in effect on the Closing
Date, and the agreements to be entered into by such parties on substantially
equivalent terms to effect the reconstitution of ResNet as a Delaware limited
liability company.

         "Responsible Officer", means any officer of the Trustee assigned by
the Trustee to administer this Indenture and also means, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of his or her knowledge of and familiarity with the particular
subject.

         "Restricted Payments" has the meaning provided in Section 4.04.

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

         "Rule 144A" means Rule 144A under the Securities Act.

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

         "Security Register" has the meaning provided in Section 2.04.

<PAGE>

                                          18


         "Significant Subsidiary" means, at any date of determination, any
Restricted Subsidiary 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
of the end of such fiscal year, was the owner of more than 10% of the
consolidated 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.

         "S&P" means Standard & Poor's Ratings Group and its successors.

         "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 more 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.

         "Subsidiary Guarantee" has the meaning provided in Section 4.07.

         "TCI Satellite" means TCI Satellite MDU Entertainment, Inc., an
affiliate of Tele-Communications, Inc., and its successors and assigns.

         "Temporary Cash Investment" means any of the following:  (i) direct
obligations of the United States of America or any agency thereof or obligations
fully and unconditionally guaranteed by the United States of America or any
agency thereof, (ii) time deposit accounts, certificates of deposit and money
market deposits maturing within 180 days of the date of acquisition thereof
issued by a bank or trust company which is organized under the laws of the
United States of America, any state thereof or any foreign country recognized by
the United States, and which bank or trust company has capital, surplus and
undivided profits aggregating in excess of $50 million (or the foreign currency
equivalent thereof) and has outstanding debt which is rated "A" (or such similar
equivalent rating) or higher by at least one nationally recognized statistical
rating organization (as defined in Rule 436 under the Securities Act) 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 of

<PAGE>

                                          19

America, any state thereof or any foreign country recognized by the United
States of America with a rating at the time as of which any investment therein
is made of "P-1" (or higher) according to Moody's or "A-1" (or higher) according
to S&P, 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 of America, or by any political
subdivision or taxing authority thereof, and rated at least "A" by S&P or
Moody's.

         "TIA" or "Trust Indenture Act" means the Trust Indenture Act of 1939,
(15 U.S. Code Sections  77aaa-77bbb), as in effect on the date this Indenture
was executed, except as provided in Section 9.06, provided that in the event the
Trust Indenture Act of 1939 is amended after such date, "TIA" or "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939, as so amended.

         "Trade Payables" means, with respect to any Person, any accounts
payable or any other indebtedness or monetary obligation to trade creditors
created, assumed or Guaranteed by such Person or any of its Subsidiaries arising
in the ordinary course of business in connection with the acquisition of goods
or services.

         "Transaction Date" means with respect to the Incurrence of any
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.

         "Trustee" means the party named as such in the first paragraph of this
Indenture until a successor replaces it in accordance with the provisions of
Article Seven of this Indenture and thereafter means such successor.

         "United States Bankruptcy Code" means the Bankruptcy Reform Act of
1978, as amended and as codified in Title 11 of the United States Code, as
amended from time to time hereafter, or any successor federal bankruptcy law.

         "U.S. Global Note" has the meaning provided in Section 2.01.

         "U.S. Government Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof at any time prior
to the Stated Maturity of the Notes, and shall also include a depository receipt
issued by a bank or trust company as custodian with respect to any such U.S.
Government

<PAGE>

                                          20

Obligation or a specific payment of interest on or principal of any such U.S.
Government Obligation held by such custodian for the account of the holder of a
depository receipt; PROVIDED that (except as required by law) such custodian is
not authorized to make any deduction from the amount payable to the holder of
such depository receipt from any amount received by the custodian in respect of
the U.S. Government Obligation or the specific payment of interest on or
principal of the U.S. Government Obligation evidenced by such depository
receipt.

         "U.S. Physical Notes" has the meaning provided in Section 2.01.

         "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 (including any newly acquired or newly formed Subsidiary of the
Company) 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 (A) any Guarantee by the Company or any
Restricted Subsidiary of any Indebtedness of the Subsidiary being so designated
shall be deemed an "Incurrence" of such Indebtedness and an "Investment" by the
Company or such Restricted Subsidiary (or both, if applicable) at the time of
such designation; (B) either (I) the Subsidiary to be so designated has total
assets of $1,000 or less or (II) if such Subsidiary has assets greater than
$1,000, such designation would be permitted under Section 4.04 and (C) if
applicable, the Incurrence of Indebtedness and the Investment referred to in
clause (A) of this proviso would be permitted under Sections 4.03 and 4.04.  The
Board of Directors may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; 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 4.03 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.

         "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,
the ownership of all of the outstanding Capital Stock of such Subsidiary (other
than any director's qualifying shares or Investments by foreign nationals
mandated by applicable law) by such Person or one or more Wholly Owned
Subsidiaries of such Person.

<PAGE>

                                          21

         SECTION 1.02.  INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture.  The following
TIA terms used in this Indenture have the following meanings:

         "indenture securities" means the Notes;

         "indenture security holder" means a Holder or a Securityholder;

         "indenture to be qualified" means this Indenture;

         "indenture trustee" or "institutional trustee" means the Trustee; and

         "obligor" on the indenture securities means the Company or any other
    obligor on the Notes.

         All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by a rule of the
Commission and not otherwise defined herein have the meanings assigned to them
therein.

         SECTION 1.03.  RULES OF CONSTRUCTION.  Unless the context otherwise
requires:

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

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

         (iii)     "or" is not exclusive;

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

         (v)       provisions apply to successive events and transactions;

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

         (vii)     all ratios and computations based on GAAP contained in this
    Indenture shall be computed in accordance with the definition of GAAP set
    forth in Section 1.01; and
<PAGE>

                                       22

          (viii)    all references to Sections or Articles refer to Sections or
     Articles of this Indenture unless otherwise indicated.


                                   ARTICLE TWO
                                    THE NOTES

          SECTION 2.01.  FORM AND DATING.  The Notes and the Trustee's
certificate of authentication shall be substantially in the form annexed hereto
as Exhibit A.  The Notes may have notations, legends or endorsements required by
law, stock exchange agreements to which the Company is subject or usage.  The
Company shall approve the form of the Notes and any notation, legend or
endorsement on the Notes.  Each Note shall be dated the date of its
authentication.

          The terms and provisions contained in the form of the Notes annexed
hereto as Exhibit A shall constitute, and are hereby expressly made, a part of
this Indenture.  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.

          Notes offered and sold in reliance on Rule 144A shall be issued
initially in the form of a single permanent global Note in registered form,
substantially in the form set forth in Exhibit A (the "U.S. GLOBAL NOTE"),
deposited with the Trustee, as custodian for the Depositary, duly executed by
the Company and authenticated by the Trustee as hereinafter provided.  The
aggregate principal amount of the U.S. Global Note may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary or its nominee, as hereinafter provided.

          Notes offered and sold in offshore transactions in reliance on
Regulation S shall be issued initially in the form of a single permanent global
Note in registered form substantially in the form set forth in Exhibit A (the
"OFFSHORE GLOBAL NOTE") deposited with the Trustee, as custodian for the
Depositary, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. The aggregate principal amount of the Offshore Global Note
may from time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for the Depositary or its nominee, as
hereinafter provided.

          Notes offered and sold in reliance on Regulation D under the
Securities Act shall be issued in the form of permanent certificated Notes in
registered form in substantially the form set forth in Exhibit A (the "U.S.
PHYSICAL NOTES").  Notes issued pursuant to Section 2.07 in exchange for
interests in the Offshore Global Note shall be in the form of permanent
certificated Notes in registered form substantially in the form set forth in
Exhibit A (the "OFFSHORE PHYSICAL NOTES").

<PAGE>

                                       23

          The Offshore Physical Notes and U.S. Physical Notes are sometimes
collectively herein referred to as the "PHYSICAL NOTES".  The U.S. Global Note
and the Offshore Global Note are sometimes referred to herein as the "GLOBAL
NOTES".

          The definitive Notes shall be typed, printed, lithographed or engraved
or produced by any combination of these methods or may be produced in any other
manner permitted by the rules of any securities exchange on which the Notes may
be listed, all as determined by the Officers executing such Notes, as evidenced
by their execution of such Notes.

          SECTION 2.02.  RESTRICTIVE LEGENDS.  Unless and until a Note is
exchanged for an Exchange Note in connection with an effective Registration
Statement pursuant to the Registration Rights Agreement, (i) the U.S. Global
Note and each U.S. Physical Note shall bear the legend, set forth below on the
face thereof and (ii) the Offshore Physical Notes and the Offshore Global Note
shall bear the legend set forth below on the face thereof until (a) at least 41
days after the Closing Date, (b) receipt by the Company and the Trustee of a
certificate substantially in the form of Exhibit B hereto and (c) the Company
shall have obtained a CUSIP or CINS number (if then generally in use) with
respect to the unlegended Offshore Global Note or Offshore Physical Note, as the
case may be.

     THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS
     AMENDED (THE "SECURITIES ACT") AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
     WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
     PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE.  BY ITS ACQUISITION
     HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
     BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN
     INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3)
     OR (7) OF REGULATION D UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL
     ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
     NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE
     SECURITIES ACT, (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
     TRANSFER OF THIS NOTE, RESELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO
     THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL
     BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE
     UNITED STATES TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH
     TRANSFER, FURNISHES TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
     REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS

<PAGE>

                                       24

     ON TRANSFER OF THIS NOTE (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE
     TRUSTEE) AND IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL
     AMOUNT OF NOTES AT THE TIME OF TRANSFER OF LESS THAN $100,000, AN OPINION
     OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE
     WITH THE SECURITIES ACT, (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE
     TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E)
     PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
     SECURITIES ACT (IF AVAILABLE) OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION
     STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL DELIVER TO
     EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
     EFFECT OF THIS LEGEND.  IN CONNECTION WITH ANY TRANSFER OF THIS NOTE WITHIN
     THE TIME PERIOD REFERRED TO ABOVE, THE HOLDER MUST CHECK THE APPROPRIATE
     BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER
     AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE.  IF THE PROPOSED TRANSFEREE IS
     AN INSTITUTIONAL ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH
     TRANSFER, FURNISH TO THE TRUSTEE AND THE COMPANY SUCH CERTIFICATIONS, LEGAL
     OPINIONS OR OTHER INFORMATION AS EITHER 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.  AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION", "UNITED
     STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S
     UNDER THE SECURITIES ACT.  THE INDENTURE CONTAINS A PROVISION REQUIRING THE
     TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE
     FOREGOING RESTRICTIONS.

          Each Global Note, whether or not an Exchange Note, shall also bear the
following legend on the face thereof:

     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
     DEPOSITORY TRUST COMPANY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
     TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
     THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
     AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT 
     HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN 
     AUTHORIZED

<PAGE>

                                       25

     
     REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR
     OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
     INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
     HEREIN.

     TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
     NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
     SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE
     LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
     SECTION 2.08 OF THE INDENTURE.

          SECTION 2.03.  EXECUTION, AUTHENTICATION AND DENOMINATIONS.  The Notes
shall be executed by an Officer of the Company listed in clause (i) of the
definition of Officer herein and attested by its Secretary, any Assistant
Secretary, the Treasurer or any Assistant Treasurer.  The signature of any of
these Officers on the Notes may be by facsimile or manual signature in the name
and on behalf of the Company.

          If an Officer whose signature is on a Note no longer holds that office
at the time the Trustee or authenticating agent authenticates the Note, the Note
shall be valid nevertheless.

          A Note shall not be valid until the Trustee or authenticating agent
manually signs the certificate of authentication on the Note.  The signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.

          The Trustee or an authenticating agent shall upon receipt of a Company
Order authenticate for original issue Notes in the aggregate principal amount of
up to $150,000,000 plus any Exchange Notes that may be issued pursuant to the
Registration Rights Agreement; PROVIDED that the Trustee shall be entitled to
receive, in addition to the documents required by Section 10.03 hereof, an
Officers' Certificate and an Opinion of Counsel of the Company in connection
with such authentication of Notes.  The Opinion of Counsel shall state:

          (a)  that the form and terms of such Notes have been established by or
     pursuant to a Board Resolution or an indenture supplemental hereto in
     conformity with the provisions of this Indenture;

          (b)  that such supplemental indenture, if any, when executed and
     delivered by the Company and the Trustee, will constitute a valid and
     binding obligation of the Company;

<PAGE>

                                       26

          (c)  that such Notes, when authenticated and delivered by the Trustee
     and issued by the Company in the manner and subject to any conditions
     specified in such Opinion of Counsel, will constitute valid and binding
     obligations of the Company in accordance with their terms and will be
     entitled to the benefits of this Indenture, subject to bankruptcy,
     insolvency, fraudulent transfer, reorganization, moratorium and similar
     laws of general applicability relating to or affecting creditors' rights
     and to general equity principles; and

          (d)  that the Company has been duly incorporated in, and is a validly
     existing corporation in good standing under the laws of, the State of
     Delaware.

Such Company Order shall specify the amount of Notes to be authenticated and the
date on which the original issue of Notes is to be authenticated.  The aggregate
principal amount of Notes outstanding at any time may not exceed the amount set
forth above except for Notes authenticated and delivered upon registration of
transfer of, or in exchange for, or in lieu of, other Notes pursuant to Section
2.06, 2.09, 2.10 or 2.11.

          The Trustee may appoint an authenticating agent to authenticate Notes.
An authenticating agent may authenticate Notes whenever the Trustee may do so.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such authenticating agent.  An authenticating agent has the
same rights as an Agent to deal with the Company or an Affiliate of the Company.

          The Notes shall be issuable only in registered form without coupons
and only in denominations of $1,000 in principal amount and any integral
multiple of $1,000 in excess thereof.

          SECTION 2.04.  REGISTRAR AND PAYING AGENT.  The Company shall maintain
an office or agency where Notes may be presented for registration of transfer or
for exchange (the "REGISTRAR"), an office or agency where Notes may be presented
for payment (the "PAYING AGENT") and an office or agency where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served, which shall be in the Borough of Manhattan, The City of New York.  The
Company shall cause the Registrar to keep a register of the Notes and of their
transfer and exchange (the "SECURITY REGISTER").  The Company may have one or
more co-Registrars and one or more additional Paying Agents.

          The Company shall enter into an appropriate agency agreement with any
agent not a party to this Indenture.  The agreement shall implement the
provisions of this Indenture that relate to such agent.  The Company shall give
prompt written notice to the Trustee of the name and address of any such agent
and any change in the address of such agent.  If the Company fails to maintain a
Registrar, Paying Agent and/or agent for service of notices and

<PAGE>

                                       27

demands, the Trustee shall act as such Registrar, Paying Agent and/or agent for
service of notices and demands.  The Company may remove any agent upon written
notice to such agent and the Trustee; PROVIDED that no such removal shall become
effective until (i) the acceptance of an appointment by a successor agent to
such agent as evidenced by an appropriate agency agreement entered into by the
Company and such successor agent and delivered to the Trustee or (ii)
notification to the Trustee that the Trustee shall serve as such agent until the
appointment of a successor agent in accordance with clause (i) of this proviso.
The Company, any Subsidiary of the Company, or any Affiliate of any of them may
act as Paying Agent, Registrar or co-Registrar, and/or agent for service of
notice and demands.

          The Company initially appoints the Trustee as Registrar, Paying Agent,
authenticating agent and agent for service of notice and demands.  If, at any
time, the Trustee is not the Registrar, the Registrar shall make available to
the Trustee on or before each Interest Payment Date and at such other times as
the Trustee may reasonably request, the names and addresses of the Holders as
they appear in the Security Register.

          SECTION 2.05.  PAYING AGENT TO HOLD MONEY IN TRUST.  Not later than
each due date of the principal, premium, if any, and interest on any Notes, the
Company shall deposit with the Paying Agent money in immediately available funds
sufficient to pay such principal, premium, if any, and interest so becoming due.
The Company shall require each Paying Agent other than the Trustee to agree in
writing that such Paying Agent shall hold in trust for the benefit of the
Holders or the Trustee all money held by the Paying Agent for the payment of
principal of, premium, if any, and interest on the Notes (whether such money has
been paid to it by the Company or any other obligor on the Notes), and such
Paying Agent shall promptly notify the Trustee of any default by the Company (or
any other obligor on the Notes) in making any such payment.  The Company at any
time may require a Paying Agent to pay all money held by it to the Trustee and
account for any funds 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 pay all money held by it to the Trustee and to
account for any funds disbursed.  Upon doing so, the Paying Agent shall have no
further liability for the money so paid over to the Trustee.  If the Company or
any Subsidiary of the Company or any Affiliate of any of them acts as Paying
Agent, it will, on or before each due date of any principal of, premium, if any,
or interest on the Notes, segregate and hold in a separate trust fund for the
benefit of the Holders a sum of money sufficient to pay such principal, premium,
if any, or interest so becoming due until such sum of money shall be paid to
such Holders or otherwise disposed of as provided in this Indenture, and will
promptly notify the Trustee of its action or failure to act.

          SECTION 2.06.  TRANSFER AND EXCHANGE.  The Notes are issuable only in
registered form. A Holder may surrender a Note for registration of transfer by
written application to the Registrar stating the name of the proposed transferee
and otherwise complying with the terms of this Indenture.  No such transfer
shall be effected until, and

<PAGE>

                                       28

such transferee shall succeed to the rights of a Holder only upon, final
acceptance and registration of the transfer by the Registrar in the Security
Register.  Prior to the registration of any transfer by a Holder as provided
herein, the Company, the Trustee, and any agent of the Company shall treat the
person in whose name the Note is registered as the owner thereof for all
purposes whether or not the Note shall be overdue, and neither the Company, the
Trustee, nor any such agent shall be affected by notice to the contrary.
Furthermore, any Holder of a U.S. Global Note shall, by acceptance of such U.S.
Global Note, agree that registration of transfers of beneficial interests in
such U.S. Global Note may be effected only through a book entry system
maintained by the Holder of such U.S. Global Note (or its agent) and that
ownership of a beneficial interest in the Note shall be required to be reflected
in a book entry.  When Notes are presented to the Registrar or a co-Registrar
with a request to register the transfer or to exchange them for an equal
principal amount of Notes of other authorized denominations (including an
exchange of Notes for Exchange Notes), the Registrar shall register the transfer
or make the exchange as requested if its requirements for such transactions are
met; PROVIDED that no exchanges of Notes for Exchange Notes shall occur until a
Registration Statement shall have been declared effective by the Commission and
that any Notes that are exchanged for Exchange Notes shall be cancelled by the
Trustee.  To permit registrations of transfers and exchanges, the Company shall
execute and the Trustee shall authenticate Notes at the Registrar's request.  No
service charge shall be made for any registration of transfer or exchange or
redemption of the Notes, 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 similar governmental
charge payable upon exchanges pursuant to Section 2.11, 3.08 or 9.04).

          The Registrar shall not be required (i) to issue, register the
transfer of or exchange any Note during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of
Notes selected for redemption under Section 3.03 and ending at the close of
business on the day of such mailing, or (ii) to register the transfer of or
exchange any Note so selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part.

          SECTION 2.07.  BOOK-ENTRY PROVISIONS FOR GLOBAL NOTES.  (a)  The U.S.
Global Note and Offshore Global Note initially shall (i) be registered in the
name of the Depositary for such Global Notes or the nominee of such Depositary,
(ii) be delivered to the Trustee as custodian for such Depositary and (iii) bear
legends as set forth in Section 2.02.

          Members of, or participants in, the Depositary ("AGENT MEMBERS") shall
have no rights under this Indenture with respect to any Global Note held on
their behalf by the Depositary, or the Trustee as its custodian, or under the
Global Note, and the Depositary may be treated by the Company, the Trustee and
any agent of the Company or the Trustee as the absolute owner of such Global
Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein
shall prevent the Company, the Trustee or any agent of the

<PAGE>

                                       29

Company or the Trustee, from giving effect to any written certification, proxy
or other authorization furnished by the Depositary or impair, as between the
Depositary and its Agent Members, the operation of customary practices governing
the exercise of the rights of a holder of any Note.

          (b)  Transfers of a Global Note shall be limited to transfers of such
Global Note in whole, but not in part, to the Depositary, its successors or
their respective nominees. Interests of beneficial owners in a Global Note may
be transferred in accordance with the rules and procedures of the Depositary and
the provisions of Section 2.08.  In addition, U.S. Physical Notes and Offshore
Physical Notes shall be transferred to all beneficial owners in exchange for
their beneficial interests in the U.S. Global Note or the Offshore Global Note,
respectively, if (i) the Depositary notifies the Company that it is unwilling or
unable to continue as Depositary for the U.S. Global Note or the Offshore Global
Note, as the case may be, and a successor depositary is not appointed by the
Company within 90 days of such notice or (ii) an Event of Default has occurred
and is continuing and the Registrar has received a request to the foregoing
effect from the Depositary.

          (c)  Any beneficial interest in one of the Global Notes that is
transferred to a Person who takes delivery in the form of an interest in the
other Global Note will, upon transfer, cease to be an interest in such Global
Note and become an interest in the other Global Note and, accordingly, will
thereafter be subject to all transfer restrictions, if any, and other procedures
applicable to beneficial interests in such other Global Note for as long as it
remains such an interest.

          (d)  In connection with any registration of transfer of a portion of
the beneficial interests in a Global Note to beneficial owners pursuant to
paragraph (b) of this Section, the Registrar shall reflect on its books and
records the date and a decrease in the principal amount of such Global Note in
an amount equal to the principal amount of the beneficial interest in such
Global Note to be transferred, and the Company shall execute, and the Trustee
shall authenticate and deliver, one or more Physical Notes of like tenor and
amount.

          (e)  In connection with the transfer of the entire U.S. Global Note or
Offshore Global Note to beneficial owners pursuant to paragraph (b) of this
Section, the U.S. Global Note or Offshore Global Note, as the case may be, shall
be deemed to be surrendered to the Trustee for cancellation, and the Company
shall execute, and the Trustee shall authenticate and deliver, to each
beneficial owner identified by the Depositary in exchange for its beneficial
interest in the U.S. Global Note or Offshore Global Note, as the case may be, an
equal aggregate principal amount of U.S. Physical Notes or Offshore Physical
Notes, as the case may be, of authorized denominations.

<PAGE>

                                       30

          (f)  Any U.S. Physical Note delivered in exchange for an interest in
the U.S. Global Note pursuant to paragraph (b) or (d) of this Section shall,
except as otherwise provided by paragraph (f) of Section 2.08, bear the legend
regarding transfer restrictions applicable to the U.S. Physical Note set forth
in Section 2.02.

          (g)  Any Offshore Physical Note delivered in exchange for an interest
in the Offshore Global Note pursuant to paragraph (b) of this Section shall,
except as otherwise provided by paragraph (f) of Section 2.08, bear the legend
regarding transfer restrictions applicable to the Offshore Physical Note set
forth in Section 2.02.

          (h)  The registered holder of a Global Note may grant proxies and
otherwise authorize any person, including Agent Members and persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Notes.

          (i)  QIBs that are beneficial owners of interests in a U.S. Global
Note may receive Physical Notes (which shall bear the Private Placement Legend
if required by Section 2.02) in accordance with the procedures of the
Depositary.  In connection with the execution, authentication and delivery of
such Physical Notes, the Registrar shall reflect on its books and records a
decrease in the principal amount of the relevant U.S. Global Note equal to the
principal amount of such Physical Notes and the Company shall execute and the
Trustee shall authenticate and deliver one or more Physical Notes having an
equal aggregate principal amount.

          SECTION 2.08.  SPECIAL TRANSFER PROVISIONS.  Unless and until a Note
is exchanged for an Exchange Note in connection with an effective Registration
pursuant to the Registration Rights Agreement, the following provisions shall
apply:

          (a)  TRANSFERS TO NON-QIB INSTITUTIONAL ACCREDITED INVESTORS.  The
following provisions shall apply with respect to the registration of any
proposed transfer of a Note to any Institutional Accredited Investor which is
not a QIB (excluding Non-U.S. Persons):

          (i)  The Registrar shall register the transfer of any Note, whether or
     not such Note bears the Private Placement Legend, if (x) the proposed
     transferor has delivered a certificate to the Registrar certifying that the
     requested transfer is after the time period referred to in Rule 144(k)
     under the Securities Act as in effect with respect to such transfer or
     (y) the proposed transferee has delivered to the Registrar (A) a
     certificate substantially in the form of Exhibit C hereto and (B) if the
     aggregate principal amount of the Notes being transferred is less than
     $100,000 at the time of such transfer, an opinion of counsel acceptable to
     the Company and the Trustee that such transfer is in compliance with the
     Securities Act.

<PAGE>

                                       31

          (ii) If the proposed transferor is an Agent Member holding a
     beneficial interest in the U.S. Global Note, upon receipt by the Registrar
     of (x) the documents, if any, required by paragraph (i) and (y)
     instructions given in accordance with the Depositary's and the Registrar's
     procedures, the Registrar shall reflect on its books and records the date
     and a decrease in the principal amount of the U.S. Global Note in an amount
     equal to the principal amount of the beneficial interest in the U.S. Global
     Note to be transferred, and the Company shall execute, and the Trustee
     shall authenticate and deliver, one or more U.S. Physical Notes of like
     tenor and amount.

          (b)  TRANSFERS TO QIBS. The following provisions shall apply with
respect to the registration of any proposed transfer of a U.S. Physical Note or
an interest in the U.S. Global Note to a QIB (excluding Non-U.S. Persons):

          (i)  If the Note to be transferred consists of (x) U.S. Physical
     Notes, the Registrar shall register the transfer if such transfer is being
     made by a proposed transferor who has checked the box provided for on the
     form of Note stating, or has otherwise advised the Company and the
     Registrar in writing, that the sale has been made in compliance with the
     provisions of Rule 144A to a transferee who has signed the certification
     provided for on the form of Note stating, or has otherwise advised the
     Company and the Registrar in writing, that it is purchasing the Note for
     its own account or an account with respect to which it exercises sole
     investment discretion and that it and any such account is a QIB within the
     meaning of Rule 144A, and is aware that the sale to it is being made in
     reliance on Rule 144A and acknowledges that it has received such
     information regarding the Company as it has requested pursuant to Rule 144A
     or has determined not to request such information and that it is aware that
     the transferor is relying upon its foregoing representations in order to
     claim the exemption from registration provided by Rule 144A or (y) an
     interest in the U.S. Global Note, the transfer of such interest may be
     effected only through the book entry system maintained by the Depositary.

          (ii) If the proposed transferee is an Agent Member, and the Note to be
     transferred consists of U.S. Physical Notes, upon receipt by the Registrar
     of the documents referred to in clause (i) and instructions given in
     accordance with the Depositary's and the Registrar's procedures, the
     Registrar shall reflect on its books and records the date and an increase
     in the principal amount of the U.S. Global Note in an amount equal to the
     principal amount of the U.S. Physical Notes, to be transferred, and the
     Trustee shall cancel the U.S. Physical Note so transferred.

          (c)  TRANSFERS OF INTERESTS IN THE OFFSHORE GLOBAL NOTE OR OFFSHORE
PHYSICAL NOTES.  The following provisions shall apply with respect to any
transfer of interests in the Offshore Global Note or Offshore Physical Notes:

<PAGE>

                                       32

          (i)  prior to the removal of the Private Placement Legend from the
     Offshore Global Note or Offshore Physical Notes pursuant to Section 2.02,
     the Registrar shall refuse to register such transfer; and

          (ii) after such removal, the Registrar shall register the transfer of
     any such Note without requiring any additional certification.

          (d)  Intentionally Omitted.

          (e)  TRANSFERS TO NON-U.S. PERSONS AT ANY TIME.  The following
provisions shall apply with respect to any transfer of a Note to a Non-U.S.
Person:

          (i)  The Registrar shall register any proposed transfer to any Non-
     U.S. Person if the Note to be transferred is a U.S. Physical Note or an
     interest in the U.S. Global Note only upon receipt of a certificate
     substantially in the form of Exhibit D from the proposed transferor.

          (ii) (a)  If the proposed Transferor is an Agent Member holding a
     beneficial interest in the U.S. Global Note, upon receipt by the Registrar
     of (x) the documents required by paragraph (i) and (y) instructions in
     accordance with the Depositary's and the Registrar's procedures, the
     Registrar shall reflect on its books and records the date and a decrease in
     the principal amount at maturity of the U.S. Global Note in an amount equal
     to the principal amount at maturity of the beneficial interest in the U.S.
     Global Note to be transferred, and (b) if the proposed transferee is an
     Agent Member, upon receipt by the Registrar of instructions given in
     accordance with the Depositary's and the Registrar's procedures, the
     Registrar shall reflect on its books and records the date and an increase
     in the principal amount at maturity of the Offshore Global Note in an
     amount equal to the principal amount at maturity of the U.S. Physical Notes
     or the U.S. Global Note, as the case may be, to be transferred, and the
     Trustee shall cancel the Physical Note, if any, so transferred or decrease
     the amount of the U.S. Global Note.

          (f)  PRIVATE PLACEMENT LEGEND.  Upon the transfer, exchange or
replacement of Notes not bearing the Private Placement Legend, the Registrar
shall deliver Notes that do not bear the Private Placement Legend. Upon the
transfer, exchange or replacement of Notes bearing the Private Placement Legend,
the Registrar shall deliver only Notes that bear the Private Placement Legend
unless either (i) the circumstances contemplated by paragraphs (a)(i)(x) or
(e)(ii) of this Section 2.08 exist or (ii) there is delivered to the Registrar
an Opinion of Counsel reasonably satisfactory to the Company and the Trustee to
the effect that neither such legend nor the related restrictions on transfer are
required in order to maintain compliance with the provisions of the Securities
Act.

<PAGE>

                                       33

          (g)  GENERAL.  By its acceptance of any Note bearing the Private
Placement Legend, each Holder of such a Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Private Placement
Legend and agrees that it will transfer such Note only as provided in this
Indenture. The Registrar shall not register a transfer of any Note unless such
transfer complies with the restrictions on transfer of such Note set forth in
this Indenture. In connection with any transfer of Notes, each Holder agrees by
its acceptance of the Notes to furnish the Registrar or the Company such
certifications, legal opinions or other information as either of them may
reasonably require to confirm that such transfer is being made pursuant to an
exemption from, or 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 any such certifications, legal opinions or other information.

          The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.07 or this Section 2.08
for at least three years after receipt thereof. The Company shall have the right
to inspect and make copies of all such letters, notices or other written
communications at any reasonable time upon the giving of reasonable written
notice to the Registrar.

          SECTION 2.09.  REPLACEMENT NOTES.  If a mutilated Note is surrendered
to the Trustee or if the Holder claims that the Note has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee shall authenticate a
replacement Note of like tenor and principal amount and bearing a number not
contemporaneously outstanding; PROVIDED that the requirements of the second
paragraph of Section 2.10 are met.  If required by the Trustee or the Company,
an indemnity bond must be furnished that is sufficient in the judgment of both
the Trustee and the Company to protect the Company, the Trustee or any Agent
from any loss that any of them may suffer if a Note is replaced.  The Company
may charge such Holder for its expenses and the expenses of the Trustee in
replacing a Note.  In case any such mutilated, lost, destroyed or wrongfully
taken Note has become or is about to become due and payable, the Company in its
discretion may pay such Note instead of issuing a new Note in replacement
thereof.

          Every replacement Note is an additional obligation of the Company and
shall be entitled to the benefits of this Indenture.

          SECTION 2.10.  OUTSTANDING NOTES.  Notes outstanding at any time are
all Notes that have been authenticated by the Trustee except for those cancelled
by it, those delivered to it for cancellation and those described in this
Section 2.10 as not outstanding.

          If a Note is replaced pursuant to Section 2.09, it ceases to be
outstanding unless and until the Trustee and the Company receive proof
satisfactory to them that the replaced Note is held by a BONA FIDE purchaser.

<PAGE>

                                       34

          If the Paying Agent (other than the Company or an Affiliate of the
Company) holds on the maturity date money sufficient to pay Notes payable on
that date, then on and after that date such Notes cease to be outstanding and
interest on them shall cease to accrue.

          A Note does not cease to be outstanding because the Company or one of
its Affiliates holds such Note, PROVIDED, HOWEVER, that, in determining whether
the Holders of the requisite principal amount of the outstanding Notes have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder, Notes owned by the Company or any other obligor upon the Notes or any
Affiliate of the Company or of such other obligor shall be disregarded and
deemed not to be outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Notes which a Responsible Officer of
the Trustee knows to be so owned shall be so disregarded.  Notes so owned which
have been pledged in good faith may be regarded as outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Notes and that the pledgee is not the Company or any other
obligor upon the Notes or any Affiliate of the Company or of such other obligor.

          SECTION 2.11.  TEMPORARY NOTES.  Until definitive Notes are ready for
delivery, the Company may prepare and the Trustee shall authenticate temporary
Notes.  Temporary Notes shall be substantially in the form of definitive Notes
but may have insertions, substitutions, omissions and other variations
determined to be appropriate by the Officers executing the temporary Notes, as
evidenced by their execution of such temporary Notes.  If temporary Notes are
issued, the Company will cause definitive Notes to be prepared without
unreasonable delay.  After the preparation of definitive Notes, the temporary
Notes shall be exchangeable for definitive Notes upon surrender of the temporary
Notes at the office or agency of the Company designated for such purpose
pursuant to Section 4.02, without charge to the Holder.  Upon surrender for
cancellation of any one or more temporary Notes the Company shall execute and
the Trustee shall authenticate and deliver in exchange therefor a like principal
amount of definitive Notes of authorized denominations.  Until so exchanged, the
temporary Notes shall be entitled to the same benefits under this Indenture as
definitive Notes.

          SECTION 2.12.  CANCELLATION.  The Company at any time may deliver to
the Trustee for cancellation any Notes previously authenticated and delivered
hereunder which the Company may have acquired in any manner whatsoever, and may
deliver to the Trustee for cancellation any Notes previously authenticated
hereunder which the Company has not issued and sold.  The Registrar and the
Paying Agent shall forward to the Trustee any Notes surrendered to them for
transfer, exchange or payment.  The Trustee shall cancel all Notes surrendered
for transfer, exchange, payment or cancellation and shall destroy them in
accordance with its normal procedure.  The Company may not issue new Notes to
replace Notes it has paid in full or delivered to the Trustee for cancellation.

<PAGE>

                                       35

          SECTION 2.13.  CUSIP NUMBERS.  The Company in issuing the Notes may
use "CUSIP" and "CINS" numbers (if then generally in use), and the Trustee shall
use CUSIP numbers or CINS numbers, as the case may be, in notices of redemption
or exchange as a convenience to Holders; PROVIDED that any such notice shall
state that no representation is made as to the correctness of such numbers
either as printed on the Notes or as contained in any notice of redemption or
exchange and that reliance may be placed only on the other identification
numbers printed on the Notes.

          SECTION 2.14.  DEFAULTED INTEREST.  If the Company defaults in a
payment of interest on the Notes, it shall pay, or shall deposit with the Paying
Agent money in immediately available funds sufficient to pay the defaulted
interest, plus (to the extent lawful) any interest payable on the defaulted
interest, to the Persons who are Holders on a subsequent special record date.  A
special record date, as used in this Section 2.14 with respect to the payment of
any defaulted interest, shall mean the 15th day next preceding the date fixed by
the Company for the payment of defaulted interest, whether or not such day is a
Business Day.  At least 15 days before the subsequent special record date, the
Company shall mail to each Holder and to the Trustee a notice that states the
subsequent special record date, the payment date and the amount of defaulted
interest to be paid.


                                  ARTICLE THREE
                                   REDEMPTION

          SECTION 3.01.  RIGHT OF REDEMPTION.  The Notes may be redeemed at the
election of the Company, in whole or in part, at any time and from time to time
on or after December 15, 2001 and prior to maturity, upon not less than 30 nor
more than 60 days' prior notice mailed by first-class mail to each Holder's last
address as it appears in the Security Register, at the following Redemption
Prices (expressed in percentages of their principal amount), 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) if redeemed
during the 12-month period commencing on December 15 of the applicable year set
forth below:

                                                  Redemption
                    Year                            Price
                    ----                          ----------
                    2001                           105.125%
                    2002                           102.563
                    2003 and thereafter            100.000

          In addition, at any time prior to December 15, 1999, the Company may
redeem up to 35% of the aggregate principal amount of the Notes with the
proceeds of one or more Public Equity Offerings, at any time as a whole or from
time to time in part, at a
<PAGE>

                                          36

Redemption Price (expressed as a percentage of principal amount on the
Redemption Date) of 110.250 %, plus accrued and unpaid interest, if any, to the
redemption date; provided that, immediately after any such redemption at least
$97.5 million aggregate principal amount of the Notes remains outstanding.

         SECTION 3.02.  NOTICES TO TRUSTEE.  If the Company elects to redeem
Notes pursuant to Section 3.01, it shall notify the Trustee in writing of the
Redemption Date and the principal amount of Notes to be redeemed.

         The Company shall give each notice provided for in this Section 3.02
in an Officers' Certificate at least 45 days before the Redemption Date (unless
a shorter period shall be satisfactory to the Trustee).

         SECTION 3.03.  SELECTION OF NOTES TO BE REDEEMED.  If less than all of
the Notes are to be redeemed at any time, the Trustee shall select the Notes 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
Notes are listed or, if the Notes 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 that no Notes of
$1,000 in principal amount or less shall be redeemed in part.

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

         SECTION 3.04.  NOTICE OF REDEMPTION.  With respect to any redemption
of Notes pursuant to Section 3.01, 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 Notes are to be redeemed.

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

         (i)    the Redemption Date;

         (ii)   the Redemption Price;

         (iii)  the name and address of the Paying Agent;
<PAGE>

                                          37


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

         (v)    that, unless the Company defaults in making the redemption
    payment, interest on Notes 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 Notes to the Paying Agent;

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

         (vii)  that, if any Note contains a CUSIP number as provided in
    Section 2.13, no representation is being made as to the correctness of the
    CUSIP number either as printed on the Notes or as contained in the notice
    of redemption and that reliance may be placed only on the other
    identification numbers printed on the Notes.

         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 45 days (or such
shorter period as shall be satisfactory to the Trustee) before a Redemption
Date, the Trustee shall give the 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 3.05.  EFFECT OF NOTICE OF REDEMPTION.  Once notice of
redemption is mailed, Notes called for redemption become due and payable on the
Redemption Date and at the Redemption Price.  Upon surrender of any Notes to the
Paying Agent, such Notes 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 Notes held by Holders to whom such notice was properly
given.

         SECTION 3.06.  DEPOSIT OF REDEMPTION PRICE.  On or prior to any
Redemption Date, the Company shall deposit with the Paying Agent (or, if the
Company is acting as its own Paying Agent, shall segregate and hold in trust as
provided in Section 2.05) money sufficient to pay the Redemption Price of and
accrued interest on all Notes to be

<PAGE>

                                          38

redeemed on that date other than Notes or portions thereof called for redemption
on that date that have been delivered by the Company to the Trustee for
cancellation; provided that if the Company shall deposit money on the Redemption
Date, the amount shall be deposited before 11:00 A.M. New York City time.

         SECTION 3.07.  PAYMENT OF NOTES CALLED FOR REDEMPTION.  If notice of
redemption has been given in the manner provided above, the Notes or portion of
Notes specified in such notice to be redeemed shall become due and payable on
the Redemption Date at the Redemption Price stated therein, together with
accrued interest to such Redemption Date, and on and after such date (unless the
Company shall default in the payment of such Notes 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
Notes), such Notes shall cease to accrue interest.  Upon surrender of any Note
for redemption in accordance with a notice of redemption, such Note 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 Regular
Record Date.

         SECTION 3.08.  NOTES REDEEMED IN PART.  Upon surrender of any Note
that is redeemed in part, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder a new Note equal in principal amount to
the unredeemed portion of such surrendered Note.


                                     ARTICLE FOUR
                                      COVENANTS

         SECTION 4.01.  PAYMENT OF NOTES.  The Company shall pay the principal
of, premium, if any, and interest on the Notes on the dates and in the manner
provided in the Notes and this Indenture.  An installment of principal, premium,
if any, or interest shall be considered paid on the date due if the Trustee or
Paying Agent (other than the Company, a Subsidiary of the Company, or any
Affiliate of any of them) holds on that date money designated for and sufficient
to pay the installment.  If the Company or any Subsidiary of the Company or any
Affiliate of any of them, acts as Paying Agent, an installment of principal,
premium, if any, or interest shall be considered paid on the due date if the
entity acting as Paying Agent complies with the last sentence of Section 2.05.
As provided in Section 6.09, upon any bankruptcy or reorganization procedure
relative to the Company, the Trustee shall serve as the Paying Agent, if any,
for the Notes.

<PAGE>

                                          39

         The Company shall pay interest on overdue principal, premium, if any,
and interest on overdue installments of interest, to the extent lawful, at the
rate per annum specified in the Notes.

         SECTION 4.02.  MAINTENANCE OF OFFICE OR AGENCY.  The Company will
maintain in the Borough of Manhattan, The City of New York an office or agency
where Notes may be surrendered for registration of transfer or exchange or for
presentation for payment and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served.  The Company will give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency.  If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the address of the Trustee set forth in Section 10.02.

         The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; PROVIDED
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York for such purposes.  The Company will give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.

         The Company hereby initially designates The Corporate Trust Office of
the Trustee, located in the Borough of Manhattan, The City of New York, as such
office of the Company in accordance with Section 2.04.

         SECTION 4.03.  LIMITATION ON INDEBTEDNESS.  (a)  The Company will not,
and will not permit any of its Restricted Subsidiaries to, Incur any
Indebtedness; PROVIDED that the Company may Incur Indebtedness, and any
Restricted Subsidiary may Incur Acquired Indebtedness, if, after giving effect
to the Incurrence of such Indebtedness and the receipt and application of the
proceeds therefrom, the Consolidated Leverage Ratio would be less than or equal
to 5.75 to 1 for Indebtedness Incurred prior to December 15, 1999, and 5.25 to 1
for Indebtedness Incurred on or after December 15, 1999.

         Notwithstanding the foregoing, the Company and any Restricted
Subsidiary (except as specified below) may Incur each and all of the following:
(i) Indebtedness outstanding at any time in an aggregate principal amount not to
exceed the amount of the commitments under the New Credit Facility on the
Closing Date, less any amount of Indebtedness permanently repaid as provided
under Section 4.11 (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

<PAGE>

                                          40

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, other than Indebtedness
Incurred under clause (i), (ii), (iv), or (vi) of this paragraph, 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
Indebtedness the proceeds of which are used to refinance or refund the Notes or
Indebtedness that is PARI PASSU with, or subordinated in right of payment to,
the Notes shall only be permitted under this clause (iii) if (A) in case the
Notes are refinanced in part or the Indebtedness to be refinanced is PARI PASSU
with the Notes, such new Indebtedness, by its terms or by the terms of any
agreement or instrument pursuant to which such new Indebtedness is outstanding,
is expressly made PARI PASSU with, or subordinate in right of payment to, the
remaining Notes, (B) in case the Indebtedness to be refinanced is subordinated
in right of payment to the Notes, such new Indebtedness, by its terms or by the
terms of any agreement or instrument pursuant to which such new Indebtedness is
issued or remains outstanding, is expressly made subordinate in right of payment
to the Notes at least to the extent that the Indebtedness to be refinanced is
subordinated to the Notes and (C) 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 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 pursuant to this clause (iii); (iv) Indebtedness
(A) in respect of performance, surety or appeal bonds provided in the ordinary
course of business, (B) under Currency Agreements and Interest Rate Agreements;
PROVIDED that such agreements (a) are designed solely to protect the Company or
its Subsidiaries against fluctuations in foreign currency exchange rates or
interest rates and (b) 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; and (C) arising from agreements providing for
indemnification, adjustment of purchase price or similar obligations, or from
Guarantees or letters of credit, surety bonds or performance bonds securing any
obligations of the Company or any of its Restricted Subsidiaries pursuant to
such agreements, in any case Incurred in connection with the disposition of any
business, assets or Restricted Subsidiary of the Company (other than Guarantees
of Indebtedness Incurred by any Person acquiring all or any portion of such
business, assets or Restricted Subsidiary of the Company for the purpose of
financing such acquisition), in a principal amount not to exceed the gross
proceeds actually received by the Company or any Restricted Subsidiary in
connection with such disposition; and (v)  Indebtedness of the Company, to the
extent the net proceeds thereof are promptly (A) used to purchase Notes tendered
in an Offer to Purchase made as a result of a Change in Control or (B) deposited
to defease the Notes as set forth in Section 8.03 and (vi) Indebtedness Incurred
by any Restricted Subsidiary in an amount not to exceed $10 million at any one
time outstanding.

<PAGE>

                                          41

         (b)    Notwithstanding any other provision of this Section 4.03, the
maximum amount of Indebtedness that the Company or a Restricted Subsidiary may
Incur pursuant to this Section 4.03 shall not be deemed to be exceeded, with
respect to any outstanding Indebtedness due solely to the result of fluctuations
in the exchange rates of currencies.

         (c)    For purposes of determining any particular amount of
Indebtedness under this Section 4.03, (1) Indebtedness Incurred under the New
Credit Facility on or prior to the Closing Date shall be treated as Incurred
pursuant to clause (i) of the second paragraph of Section 4.03(a), (2)
Guarantees, Liens or obligations with respect to letters of credit supporting
Indebtedness otherwise included in the determination of such particular amount
shall not be included and (3) any Liens granted pursuant to the equal and
ratable provisions referred to in Section 4.09 shall not be treated as
Indebtedness.  For purposes of determining compliance with this Section 4.03, 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 (other than
Indebtedness referred to in clause (1) of the preceding sentence), 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 4.04.  LIMITATION ON RESTRICTED PAYMENTS.  The Company will
not, and will not permit any Restricted Subsidiary to, directly or indirectly,
(i) declare or pay any dividend or make any distribution on or with respect to
its Capital Stock (other than (x) dividends or distributions payable solely in
shares of its Capital Stock (other than Redeemable Stock) or in options,
warrants or other rights to acquire shares of such Capital Stock and (y) pro
rata dividends or distributions on Common Stock of Restricted Subsidiaries held
by minority stockholders) held by Persons other than the Company or any of its
Restricted Subsidiaries, (ii) purchase, redeem, retire or otherwise acquire for
value any shares of Capital Stock of (A) the Company or an Unrestricted
Subsidiary (including options, warrants or other rights to acquire such shares
of Capital Stock) held by any Person or (B) a Restricted Subsidiary (including
options, warrants or other rights to acquire such shares of Capital Stock) held
by any Affiliate of the Company (other than a Wholly Owned Restricted
Subsidiary) or any holder (or any Affiliate of such holder) of 10% or more of
the Capital Stock of the Company, (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 Notes (other than the purchase,
repurchase or the acquisition of Indebtedness in anticipation of satisfying a
sinking fund obligation, principal installment or final maturity, in any case
due within one year of the date of acquisition) or (iv) make any Investment,
other than a Permitted Investment, in any Person (such payments or 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) the Company could not Incur at least $1.00 of Indebtedness
under the first paragraph of Section 4.03 or (C) the aggregate amount of all
Restricted

<PAGE>

                                          42

Payments (the amount, 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) made after the Closing Date shall exceed the sum of (1) the
remainder of (x) the aggregate amount of the Consolidated EBITDA (or, if the
Consolidated EBITDA is a loss, minus 100% of the amount of such loss)
(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 during which the Closing Date occurs and
ending on the last day of the last fiscal quarter preceding the Transaction Date
for which reports have been filed pursuant to Section 4.18 minus (y) the product
of two multiplied by the aggregate amount of Consolidated Fixed Charges for the
period referred to in clause (x) 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
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 Notes) PLUS (3) an amount equal to the net reduction in
Investments (other than reductions in Permitted 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 or from the Net Cash Proceeds from the sale of any
such Investment (except, in each case, to the extent any such payment or
proceeds are included in the calculation of Adjusted Consolidated Net Income),
or from redesignations of Unrestricted Subsidiaries as Restricted Subsidiaries
(valued in each case as provided in the definition of "Investments"), not to
exceed, in each case, the amount of Investments previously made by the Company
or any Restricted Subsidiary in such Person or Unrestricted Subsidiary.

         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 Notes 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 4.03(a); (iii)(A) 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 (other than
Redeemable Stock) of the Company or (B) the repurchase, redemption or other
acquisition of Capital Stock of a Restricted Subsidiary (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
(other than Redeemable Stock) of such Restricted Subsidiary; (iv) the making

<PAGE>

                                          43

of any principal payment or the repurchase, redemption, retirement, defeasance
or other acquisition for value of Indebtedness of the Company which is
subordinated in right of payment to the Notes in exchange for, or out of the
proceeds of, a substantially concurrent offering of, shares of the Capital Stock
of the Company (other than Redeemable Stock); (v) payments or distributions, to
dissenting stockholders pursuant to applicable law, pursuant to or in connection
with a consolidation, merger or transfer of assets that complies with Article
Five; (vi) Investments in Unrestricted Subsidiaries not to exceed $20 million at
any one time outstanding; and (vii) Restricted Payments not to exceed $5 million
in the aggregate; PROVIDED that, except in the case of clauses (i) and (iii), no
Default or Event of Default shall have occurred and be continuing or occur as a
consequence of the actions or payments set forth therein.

         Each Restricted Payment permitted pursuant to the preceding paragraph
(other than the Restricted Payment referred to in clause (ii) thereof and an
exchange of Capital Stock for Capital Stock or Indebtedness referred to in
clause (iii) or (iv) thereof), and the Net Cash Proceeds from any issuance of
Capital Stock referred to in clauses (iii) and (iv), shall be included in
calculating whether the conditions of clause (C) of the first paragraph of this
Section 4.04 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 Notes, or
Indebtedness that is PARI PASSU with the Notes, then the Net Cash Proceeds of
such issuance shall be included in clause (C) of the first paragraph of this
Section 4.04 only to the extent such proceeds are not used for such redemption,
repurchase or other acquisition of Indebtedness.

         SECTION 4.05.  LIMITATION ON DIVIDEND AND OTHER PAYMENT RESTRICTIONS
AFFECTING RESTRICTED SUBSIDIARIES.  The Company will not, and will not permit
any Restricted Subsidiary to, 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, (iii) make loans or advances to the Company or any other Restricted
Subsidiary or (iv) transfer any of its property or assets to the Company or any
other Restricted Subsidiary.

         The foregoing provisions shall not restrict any encumbrances or
restrictions:  (i) existing on the Closing Date in the New Credit Facility, this
Indenture, the ResNet Transaction Documents or any other agreements 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

<PAGE>

                                          44

Person or the property or assets of such Person acquired by the Company or any
Restricted Subsidiary, existing at the time of such acquisition and not incurred
in contemplation thereof, which encumbrances or 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 4.05, (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 not 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; or (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.
Nothing contained in this Section 4.05 shall prevent the Company or any
Restricted Subsidiary from (1) creating, incurring, assuming or suffering to
exist any Liens otherwise permitted by the Section 4.09 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 4.06.  LIMITATION ON THE 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 of director's qualifying
shares 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, provided any
Investment in such Person remaining after giving effect to such issuance or sale
would have been permitted to be made under Section 4.04, if made on the date of
such issuance or sale; and (iv) issuances of Common Stock of ResNet (x) to TCI
Satellite pursuant to the terms of the ResNet Transaction Documents as in effect
on the Closing Date and (y) in exchange for, or the net proceeds of which are
used solely for, redemptions of Common Stock of ResNet.

         SECTION 4.07.  LIMITATION ON ISSUANCES OF GUARANTEES BY RESTRICTED
SUBSIDIARIES.  The Company will not permit any Restricted Subsidiary, directly
or indirectly, to Guarantee any Indebtedness of the Company which is PARI PASSU
with or subordinate in right of payment to the Notes ("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 Notes by such

<PAGE>

                                          45

Restricted Subsidiary and (ii) such 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 (x) any Guarantee of any Restricted Subsidiary that existed
at the time such Person became a Restricted Subsidiary and was not Incurred in
connection with, or in contemplation of, such Person becoming a Restricted
Subsidiary or (y) any Guarantee of any Subsidiary of Indebtedness Incurred under
a revolving credit or working capital facility.  If the Guaranteed Indebtedness
is (A) PARI PASSU with the Notes, then the Guarantee of such Guaranteed
Indebtedness shall be PARI PASSU with, or subordinated to, the Subsidiary
Guarantee or (B) subordinated to the Notes, then the Guarantee of such
Guaranteed Indebtedness shall be subordinated to the Subsidiary Guarantee at
least to the extent that the Guaranteed Indebtedness is subordinated to the
Notes.

         Notwithstanding the foregoing, any Subsidiary Guarantee by a
Restricted Subsidiary may provide by its terms that it shall be automatically
and unconditionally released and discharged upon (i) any sale, exchange or
transfer, to any Person not an Affiliate of the Company, of all of the Company's
and each Restricted Subsidiary's Capital Stock in, or all or substantially all
the assets of, such Restricted Subsidiary (which sale, exchange or transfer is
not prohibited by this Indenture) or (ii) the release or discharge of the
Guarantee which resulted in the creation of such Subsidiary Guarantee, except a
discharge or release by or as a result of payment under such Guarantee.

         SECTION 4.08.  LIMITATION ON TRANSACTIONS WITH STOCKHOLDERS AND
AFFILIATES. The Company will not, and will not permit any Restricted Subsidiary
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 10% 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 and customary regular fees to directors of the Company who are not
employees of the Company;

<PAGE>

                                          46

(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; (v) any Restricted Payments not prohibited by Section
4.04 or (vi) transactions pursuant to the ResNet Transaction Documents.
Notwithstanding the foregoing, any transaction covered by the first paragraph of
this Section 4.08 and not covered by clauses (ii) through (vi) of this
paragraph, the aggregate amount of which exceeds $1 million in value, must be
approved or determined to be fair in the manner provided for in clause (i)(A) or
(B) above.

         SECTION 4.09.  LIMITATION ON LIENS.  The Company will not, and will
not permit any Restricted Subsidiary to, 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, without
making effective provision for all of the Notes 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 Notes, 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; (iii) Liens with respect to the assets of a Restricted Subsidiary
granted by such Restricted Subsidiary to the Company 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 4.03; 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) Liens securing obligations under the New
Credit Facility; or (vi) Permitted Liens.

         SECTION 4.10.  LIMITATION ON SALE-LEASEBACK TRANSACTIONS.  The Company
will not, and will not permit any Restricted Subsidiary to, enter into any
sale-leaseback transaction involving any of its assets or properties whether now
owned or hereafter acquired, whereby the Company or a Restricted Subsidiary
sells or transfers such assets or properties and then or thereafter leases such
assets or properties or any part thereof or any other assets or properties which
the Company or such Restricted Subsidiary, as the case may be, intends to use
for substantially the same purpose or purposes as the assets or properties sold
or transferred.

         The foregoing restriction does not apply to any sale-leaseback
transaction if (i) the lease is for a period, including renewal rights, of not
in excess of three years; (ii) the lease secures or relates to industrial
revenue or pollution control bonds; (iii) the transaction is solely between the
Company and any Wholly Owned Restricted Subsidiary or solely between

<PAGE>

                                          47

Wholly Owned Restricted Subsidiaries; or (iv) the Company or such Restricted
Subsidiary, within twelve months after the sale or transfer of any assets or
properties is completed, applies an amount not less than the net proceeds
received from such sale in accordance with clause (A) or (B) of the first
paragraph of Section 4.12.

         SECTION 4.11.  LIMITATION ON ASSET SALES.  The Company will not, and
will not permit any Restricted Subsidiary to, consummate any Asset Sale in an
amount in greater than 10% of the Company's Adjusted Consolidated Net Tangible
Assets, 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 75% of the consideration received consists of cash
(which shall include any Indebtedness of the Company or its Restricted
Subsidiaries that is assumed by the buyer) or Temporary Cash Investments.  In
the event and to the extent that the Net Cash Proceeds received by the Company
or any of its Restricted Subsidiaries from one or more Asset Sales occurring on
or after the Closing Date in any period of 12 consecutive months exceed 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 have been filed pursuant to Section 4.18),
then the Company shall or shall cause the relevant Restricted Subsidiary to
(i) within twelve months after the date Net Cash Proceeds so received exceed 10%
of Adjusted Consolidated Net Tangible Assets (A) apply an amount equal to such
excess Net Cash Proceeds to permanently repay unsubordinated Indebtedness of the
Company, or any Restricted Subsidiary providing a Subsidiary Guarantee pursuant
to Section 4.07 or Indebtedness of any other 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
twelve months after the date of such agreement), in property or assets (other
than current 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 and (ii) apply (no later than the end of the
twelve-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 4.11.  The amount of such excess Net Cash Proceeds
required to be applied (or to be committed to be applied) during such
twelve-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 4.11 totals at least $10 million, the Company must commence, not later
than the fifteenth Business Day of such month, and consummate an Offer to
Purchase from the Holders on a pro rata basis an aggregate principal amount of
Notes on the relevant Payment Date equal to the Excess

<PAGE>

                                          48

Proceeds on such date, at a purchase price equal to 101% of the principal amount
of the Notes on the relevant Payment Date, plus, in each case, accrued interest
(if any) to the Payment Date.

         SECTION 4.12.  REPURCHASE OF NOTES UPON A CHANGE OF CONTROL.  The
Company must commence, within 30 days after the occurrence of a Change of
Control, and consummate an Offer to Purchase for all Notes then outstanding, at
a purchase price equal to 101% of the principal amount thereof on the relevant
Payment Date, plus accrued interest (if any) to the Payment Date.

         SECTION 4.13.  EXISTENCE.  Subject to Articles Four and Five of this
Indenture, the Company will do or cause to be done all things necessary to
preserve and keep in full force and effect its existence and the existence of
each of its Restricted Subsidiaries in accordance with the respective
organizational documents of the Company and each such Subsidiary and the rights
(whether pursuant to charter, partnership certificate, agreement, statute or
otherwise), material licenses and franchises of the Company and each such
Subsidiary; PROVIDED that the Company shall not be required to preserve any such
right, license or franchise, or the existence of any Restricted Subsidiary, if
the maintenance or preservation thereof is no longer desirable in the conduct of
the business of the Company and its Restricted Subsidiaries taken as a whole.

         SECTION 4.14.  PAYMENT OF TAXES AND OTHER CLAIMS.  The Company will 
pay or discharge and shall cause each of its Subsidiaries to pay or 
discharge, or cause to be paid or discharged, before the same shall become 
delinquent (i) all material taxes, assessments and governmental charges 
levied or imposed upon (a) the Company or any such Subsidiary, (b) the income 
or profits of any such Subsidiary which is a corporation or (c) the property 
of the Company or any such Subsidiary and (ii) all material lawful claims for 
labor, materials and supplies that, if unpaid, might by law become a lien 
upon the property of the Company or any such Subsidiary; PROVIDED that the 
Company shall not be required to pay or discharge, or cause to be paid or 
discharged, any such tax, assessment, charge or claim the amount, 
applicability or validity of which is being contested in good faith by 
appropriate proceedings and for which adequate reserves have been established.

         SECTION 4.15.  MAINTENANCE OF PROPERTIES AND INSURANCE.  The Company 
will cause all properties used or useful in the conduct of its business or 
the business of any of its Restricted Subsidiaries, to be maintained and kept 
in good condition, repair and working order and supplied with all necessary 
equipment and will cause to be made all necessary repairs, renewals, 
replacements, betterments and improvements thereof, all as in the judgment of 
the Company may be necessary so that the business carried on in connection 
therewith may be properly and advantageously conducted at all times; PROVIDED 
that nothing in this Section 4.15 shall prevent the Company or any such 
Subsidiary from discontinuing the use, operation or maintenance of any of 
such properties or disposing of any of them, if such

<PAGE>

                                          49

discontinuance or disposal is, in the judgment of the Company, desirable in the
conduct of the business of the Company or such Subsidiary.

         The Company will provide or cause to be provided, for itself and its
Restricted Subsidiaries, insurance (including appropriate self-insurance)
against loss or damage of the kinds customarily insured against by corporations
similarly situated and owning like properties, including, but not limited to,
products liability insurance and public liability insurance, with reputable
insurers or with the government of the United States of America, or an agency or
instrumentality thereof, in such amounts, with such deductibles and by such
methods as shall be customary for corporations similarly situated in the
industry in which the Company or such Restricted Subsidiary, as the case may be,
is then conducting business.

         SECTION 4.16.  NOTICE OF DEFAULTS.  In the event that the Company
becomes aware of any Default or Event of Default the Company, promptly after it
becomes aware thereof, will give written notice thereof to the Trustee.

         SECTION 4.17.  COMPLIANCE CERTIFICATES.  (a)  The Company shall
deliver to the Trustee, within 45 days after the end of each fiscal quarter (90
days after the end of the last fiscal quarter of each year), an Officers'
Certificate stating whether or not the signers know of any Default or Event of
Default that occurred during such fiscal quarter.  In the case of the Officers'
Certificate delivered within 90 days of the end of the Company's fiscal year,
such certificate shall contain a certification from the principal executive
officer, principal financial officer or principal accounting officer that a
review has been conducted of the activities of the Company and its Restricted
Subsidiaries and the Company's and its Restricted Subsidiaries' performance
under this Indenture and that the Company has complied with all conditions and
covenants under this Indenture.  For purposes of this Section 4.17, such
compliance shall be determined without regard to any period of grace or
requirement of notice provided under this Indenture.  If they do know of such a
Default or Event of Default, the certificate shall describe any such Default or
Event of Default and its status.  The first certificate to be delivered pursuant
to this Section 4.17(a) shall be for the first fiscal quarter beginning after
the execution of this Indenture.

         (b)    The Company shall deliver to the Trustee, within 90 days after
the end of the Company's fiscal year, a certificate signed by the Company's
independent certified public accountants stating (i) that their audit
examination has included a review of the terms of this Indenture and the Notes
as they relate to accounting matters, (ii) that they have read the most recent
Officers' Certificate delivered to the Trustee pursuant to paragraph (a) of this
Section 4.17 and (iii) whether, in connection with their audit examination,
anything came to their attention that caused them to believe that the Company
was not in compliance with any of the terms, covenants, provisions or conditions
of Article Four and Section 5.01 of this Indenture as they pertain to accounting
matters and, if any Default or Event of Default has come to their attention,
specifying the nature and period of existence thereof; PROVIDED that such
independent certified public accountants shall not be liable in respect of such
statement by reason of any failure to obtain knowledge of any such Default or
Event of Default that

<PAGE>

                                          50

would not be disclosed in the course of an audit examination conducted in
accordance with generally accepted auditing standards in effect at the date of
such examination.

         SECTION 4.18.  COMMISSION REPORTS AND REPORTS TO HOLDERS.  Whether or
not the Company is required to file reports with the Commission, for so long as
any Notes are outstanding, the Company shall file with the Commission all such
reports and other information as it would be required to file with the
Commission by Sections 13(a) or 15(d) under the Exchange Act if it were subject
thereto. The Company shall supply the Trustee and each Holder or shall supply to
the Trustee for forwarding to each such Holder, without cost to such Holder,
copies of such reports and other information.  The Company also shall comply
with the other provisions of TIA Section 314(a).

         SECTION 4.19.  WAIVER OF STAY, EXTENSION OR USURY LAWS.  The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury law or 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 Notes as contemplated herein,
wherever enacted, now or at any time hereafter in force, or that 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 will suffer and permit
the execution of every such power as though no such law had been enacted.


                                     ARTICLE FIVE
                                SUCCESSOR CORPORATION

         SECTION 5.01.  WHEN COMPANY MAY MERGE, ETC.  The Company will 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 Notes and
    under this Indenture;

         (ii)   immediately after giving effect to such transaction, no Default
    or Event of Default shall have occurred and be continuing;
<PAGE>

                                          51


         (iii)  immediately after giving effect to such transaction on a
    pro forma basis the Company, or any Person becoming the successor obligor
    of the Notes, as the case may be, could Incur at least $1.00 of
    Indebtedness under the first paragraph of Section 4.03(a); PROVIDED that
    this clause (iii) shall not apply to a consolidation or merger with or into
    a Wholly Owned Restricted Subsidiary with a positive net worth; PROVIDED
    that, in connection with any such merger or consolidation, no consideration
    (other than Common Stock in the surviving Person or the Company) shall be
    issued or distributed to the stockholders of the Company; and

         (iv)   the Company delivers to the Trustee an Officers' Certificate
    (attaching the arithmetic computations to demonstrate compliance with
    clause (iii)) and 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 clause (iii) above does 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 5.02.  SUCCESSOR SUBSTITUTED.  Upon any consolidation or
merger, or any sale, conveyance, transfer, lease or other disposition of all or
substantially all of the property and assets of the Company in accordance with
Section 5.01 of this Indenture, the successor Person formed by such
consolidation or into which the Company is merged or to which such sale,
conveyance, transfer, lease or other disposition is made shall succeed to, and
be substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor Person had been named
as the Company herein; PROVIDED that the Company shall not be released from its
obligation to pay the principal of, premium, if any, or interest on the Notes in
the case of a lease of all or substantially all of its property and assets.

                                     ARTICLE SIX
                                 DEFAULT AND REMEDIES

         SECTION 6.01.  EVENTS OF DEFAULT.  An "EVENT OF DEFAULT" shall occur
with respect to the Notes if:

         (a)    the Company defaults in the payment of the principal of (or
    premium, if any, on) any Note when the same becomes due and payable at
    maturity, upon acceleration, redemption or otherwise;

<PAGE>

                                          52

         (b)    the Company defaults in the payment of interest on any Note
    when the same becomes due and payable, and such default continues for a
    period of 30 days;

         (c)    the Company defaults in the performance of, or breaches the
    provisions of, Article Five or fails to make or consummate an Offer to
    Purchase in accordance with Section 4.11 or 4.12;

         (d)    the Company defaults in the performance of or breaches any
    other covenant or agreement of the Company in this Indenture or under the
    Notes (other than a default specified in clause (a), (b) or (c) above) and
    such default or breach continues for a period of 30 consecutive days after
    written notice to the Company by the Trustee or the Holders of 25% or more
    in aggregate principal amount of the Notes;

         (e)    there occurs with respect to any issue or issues of
    Indebtedness of the Company or any Significant Subsidiary having an
    outstanding principal amount of $10 million or more in the aggregate for
    all such issues of all such Persons, whether such Indebtedness now exists
    or shall hereafter be created, (I) 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 (II) the failure to make a principal payment at
    the final (but not any interim) 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 $10 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 $10 million 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 or 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

<PAGE>

                                          53

    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 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 or 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 6.02.  ACCELERATION.  If an Event of Default (other than an
Event of Default specified in clause (g) or (h) of Section 6.01 that occurs 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
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 principal of, premium, if any, and accrued
interest on the Notes to be immediately due and payable.  Upon a declaration of
acceleration, such principal of, premium, if any, and accrued interest shall be
immediately due and payable PROVIDED that for so long as the New Credit Facility
is in effect, such declaration shall not become effective until the earlier of
(i) five Business Days after receipt of the acceleration notice by the Agent and
the Company and (ii) acceleration of the Indebtedness under the New Credit
Facility.  In the event of a declaration of acceleration because an Event of
Default set forth in clause (e) of Section 6.01 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 clause (e)
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 clause (g) or (h) of Section 6.01 occurs with respect to the
Company, the principal of, premium, if any, and accrued interest on the Notes
then outstanding shall IPSO FACTO become and be immediately due and payable
without any declaration or other act on the part of the Trustee or any Holder.

         At any time after such a declaration of acceleration, but before a
judgment or decree for the payment of the money due has been obtained by the
Trustee, the Holders of at least a majority in principal amount of the
outstanding Notes by written notice to the Company and to the Trustee, may waive
all past Defaults and rescind and annul such declaration of acceleration and its
consequences if (i) all existing Events of Default, other than the non-payment
of the principal of, premium, if any, and accrued interest on the Notes that
have become due solely by such declaration of acceleration, have been cured or
waived, (ii) the rescission would not conflict with any judgment or decree of a
court of competent jurisdiction and (iii) all moneys paid or advanced by the
Trustee hereunder and the

<PAGE>

                                          54

reasonable compensation, expenses, disbursement and advances of the Trustee, its
agents and counsel and all other amounts due to the Trustee pursuant to Section
7.07 have been paid.

         SECTION 6.03.  OTHER REMEDIES.  If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal of, premium, if any, or interest
on the Notes or to enforce the performance of any provision of the Notes or this
Indenture.

         The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding.

         SECTION 6.04.  WAIVER OF PAST DEFAULTS.  Subject to Sections 6.02,
6.07 and 9.02, the Holders of at least a majority in principal amount of the
outstanding Notes, by notice to the Trustee, may waive an existing Default or
Event of Default and its consequences, except a Default in the payment of
principal of, premium, if any, or interest on any Note as specified in clause
(a) or (b) of Section 6.01 or in respect of a covenant or provision of this
Indenture which cannot be modified or amended without the consent of the holder
of each outstanding Note affected.  Upon any such waiver, such Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every purpose of this Indenture; but no such waiver shall
extend to any subsequent or other Default or Event of Default or impair any
right consequent thereto.

         SECTION 6.05.  CONTROL BY MAJORITY.  The Holders of at least a
majority in aggregate principal amount of the outstanding Notes 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; PROVIDED,
that 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 Notes not joining in the giving of such direction; and PROVIDED
FURTHER, that the Trustee may take any other action it deems proper that is not
inconsistent with any such direction received from Holders of Notes pursuant to
this Section 6.05.

         SECTION 6.06.  LIMITATION ON SUITS.  A Holder may not institute any
proceeding, judicial or otherwise, with respect to this Indenture or the Notes,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless:

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

         (ii)   the Holders of at least 25% in aggregate principal amount of
    outstanding Notes shall have made written request to the Trustee to pursue
    the remedy;

<PAGE>

                                          55

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

         (iv)   the Trustee for 60 days after its receipt of such notice,
    request and offer of indemnity has failed to comply with such request; and

         (v)    during such 60-day period, the Holders of a majority in
    aggregate principal amount of the outstanding Notes have not given the
    Trustee a direction that is inconsistent with such written request.

         For purposes of Section 6.05 of this Indenture and this Section 6.06,
the Trustee shall comply with TIA Section 316(a) in making any determination of
whether the Holders of the required aggregate principal amount of outstanding
Notes have concurred in any request or direction of the Trustee to pursue any
remedy available to the Trustee or the Holders with respect to this Indenture or
the Notes or otherwise under the law.

         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.

         The limitations set forth in this Section 6.06 shall not apply to the
right of any Holder of a Note to receive payment of the principal of, premium,
if any, or interest on, such Note or to bring suit for the enforcement of any
such payment, on or after the due date expressed in the Notes, which right shall
not be impaired or affected without the consent of the Holder.

         SECTION 6.07.  RIGHTS OF HOLDERS TO RECEIVE PAYMENT.  Notwithstanding
any other provision of this Indenture, the right of any Holder of a Note to
receive payment of principal of, premium, if any, or interest on such Holder's
Note on or after the respective due dates expressed on such Note, 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 6.08.  COLLECTION SUIT BY TRUSTEE.  If an Event of Default in
payment of principal, premium or interest specified in clause (a), (b) (c) or
(d) of Section 6.01 occurs and is continuing, the Trustee may recover judgment
in its own name and as trustee of an express trust against the Company or any
other obligor of the Notes for the whole amount of principal, premium, if any,
and accrued interest remaining unpaid, together with interest on overdue
principal, premium, if any, and, to the extent that payment of such interest is
lawful, interest on overdue installments of interest, in each case at the rate
specified in the Notes, 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.

<PAGE>

                                          56

         SECTION 6.09.  TRUSTEE MAY FILE PROOFS OF CLAIM.  The Trustee may 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 any other amounts due the Trustee under
Section 7.07) and the Holders allowed in any judicial proceedings relative to
the Company (or any other obligor of the Notes), its creditors or its property
and shall be entitled and empowered to collect and receive any monies,
securities or other property payable or deliverable upon conversion or exchange
of the Notes or upon any such claims and to distribute the same, and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay to
the Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agent and counsel, and any other
amounts due the Trustee under Section 7.07.  Nothing herein contained shall be
deemed to empower 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 Notes or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.

         SECTION 6.10.  PRIORITIES.  If the Trustee collects any money pursuant
to this Article Six, it shall pay out the money in the following order:

         First:  to the Trustee for all amounts due under Section 7.07;

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

         Third:  to the Company or any other obligors of the Notes, as their
    interests may appear, or as a court of competent jurisdiction may direct.

         The Trustee, upon prior written notice to the Company, may fix a
record date and payment date for any payment to Holders pursuant to this Section
6.10.

         SECTION 6.11.  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 Trustee, a court may require any party
litigant in such suit to file an undertaking to pay the costs of the suit, and
the court 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 6.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
6.07 of this

<PAGE>

                                          57

Indenture, or a suit by Holders of more than 10% in principal amount of the
outstanding Notes.

         SECTION 6.12.  RESTORATION OF RIGHTS AND REMEDIES.  If the Trustee or
any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then,
and in every such case, subject to any determination in such proceeding, the
Company, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Company, Trustee and the Holders shall continue as though no
such proceeding had been instituted.

         SECTION 6.13.  RIGHTS AND REMEDIES CUMULATIVE.  Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or wrongfully taken Notes in Section 2.09, no right or remedy herein
conferred upon or reserved to the Trustee or to the Holders is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise.  The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.

         SECTION 6.14.  DELAY OR OMISSION NOT WAIVER.  No delay or omission of
the Trustee or of any Holder to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or constitute a waiver of
any such Event of Default or an acquiescence therein.  Every right and remedy
given by this Article Six or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed expedient, by the
Trustee or by the Holders, as the case may be.

         SECTION 6.15.  WAIVER OF STAY OR EXTENSION LAWS.  The Company (to the
extent it may lawfully do so) shall not at any time insist upon, or plead, or in
any manner whatsoever claim to take the benefit or advantage of, any stay or
extension law wherever enacted, now or at any time hereafter in force, which may
affect the covenants or the performance of this Indenture; and the Company (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and shall 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 had been enacted.

<PAGE>

                                          58

                                    ARTICLE SEVEN
                                       TRUSTEE

         SECTION 7.01.  GENERAL.  (a)  If an Event of Default has occurred and
is continuing, the Trustee shall exercise the rights and powers vested in it by
this Indenture and shall use the same degree of care and skill in their exercise
as a prudent person would exercise or use under the circumstances in the conduct
of such person's own affairs.

    (b)  Except during the continuance of an Event of Default:  (i) the Trustee
undertakes to perform such duties and only such duties as are specifically set
forth in this Indenture and no implied covenants or obligations shall be read
into this Indenture against the Trustee; and (ii) in the absence of bad faith on
its part, the Trustee may conclusively rely, as to the truth of statements and
the correctness of the opinions expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements of this Indenture,
PROVIDED, HOWEVER, that in the case of any such certificates or opinions which
by any provision hereof are specifically required to be furnished to the
Trustee, the Trustee shall examine the certficates and opinions to determine
whether or not they conform to the requirement of this Indenture.

    (c)  The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, PROVIDED
that:  (i) this paragraph (c) shall not limit the effect of paragraph (b) of
this Section 7.01; (ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer unless it is proved that
the Trustee was negligent in ascertaining the pertinent facts; and (iii) 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 6.05 hereof.

    (d)  Trustee shall not be liable for interest on any money received by it
except as the Trustee may agree in writing with the Company.

    (e)  Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law.

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

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

<PAGE>

                                          59

         SECTION 7.02.  CERTAIN RIGHTS OF TRUSTEE.  Subject to TIA Sections
315(a) through (d):

         (i)    the Trustee may rely and shall be protected in acting or
    refraining from acting upon any resolution, certificate, statement,
    instrument, opinion, report, notice, request, direction, consent, order,
    bond, debenture, note, other evidence of indebtedness or other paper or
    document believed by it to be genuine and to have been signed or presented
    by the proper person.  The Trustee need not investigate any fact or matter
    stated in the document;

         (ii)   before the Trustee acts or refrains from acting, it may require
    an Officers' Certificate or an Opinion of Counsel, which shall conform to
    Section 10.04.  The Trustee shall not be liable for any action it takes or
    omits to take in good faith in reliance on such certificate or opinion;

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

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

         (v)    the Trustee shall not be liable for any action it takes or
    omits to take in good faith that it believes to be authorized or within its
    rights or powers or for any action it takes or omits to take in accordance
    with the direction of the Holders of a majority in principal amount of the
    outstanding Notes relating to the time, method and place of conducting any
    proceeding for any remedy available to the Trustee, or exercising any trust
    or power conferred upon the Trustee, under this Indenture; PROVIDED that
    the Trustee's conduct does not constitute negligence or bad faith;

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

         (vii)  the Trustee shall not be bound to make any investigation into
    the facts or matters stated in any resolution, certificate, statement,
    instrument, opinion, report, notice, request, direction, consent, order,
    bond, debenture, note, other evidence of indebtedness or other paper or
    document, but the Trustee, in its discretion, may make such further inquiry
    or investigation into such facts or matters as it may see fit, and, if the
    Trustee shall determine to make such further inquiry or investigation, it
    shall be

<PAGE>

                                          60

    entitled to examine the books, records and premises of the Company
    personally or by agent or attorney; and

         (viii)  The Trustee shall not be charged with knowledge of any Default
    or Event of Default under Section 6.01 hereof unless either (i) a
    Responsible Officer shall have actual knowledge thereof, or (ii) the
    Trustee shall have received notice thereof in accordance with Section 10.02
    hereof from the Company or any Holder of Notes.

         SECTION 7.03.  INDIVIDUAL RIGHTS OF TRUSTEE.  The Trustee, in its
individual or any other capacity, may become the owner or pledgee of Notes and
may otherwise deal with the Company or its Affiliates with the same rights it
would have if it were not the Trustee.  Any Agent may do the same with like
rights.  However, the Trustee is subject to TIA Sections 310(b) and 311.

         SECTION 7.04.  TRUSTEE'S DISCLAIMER.  The Trustee (i) makes no
representation as to the validity or adequacy of this Indenture or the Notes,
(ii) shall not be accountable for the Company's use or application of the
proceeds from the Notes and (iii) shall not be responsible for any statement in
the Notes other than its certificate of authentication.

         SECTION 7.05.  NOTICE OF DEFAULT.  If any Default or any Event of
Default occurs and is continuing and if such Default or Event of Default is
known to the Trustee, the Trustee shall mail to each Holder in the manner and to
the extent provided in TIA Section 313(c) notice of the Default or Event of
Default within 45 days after it occurs, unless such Default or Event of Default
has been cured; PROVIDED, HOWEVER, that, except in the case of a default in the
payment of the principal of, premium, if any, or interest on any Note, the
Trustee shall be protected in withholding such notice if and so long as the
board of directors, the executive committee or a trust committee of directors
and/or Responsible Officers of the Trustee in good faith determine that the
withholding of such notice is in the interest of the Holders.

         SECTION 7.06.  REPORTS BY TRUSTEE TO HOLDERS.  Within 60 days after
each May 15, beginning with May 15, 1997, the Trustee shall mail to each Holder
as provided in TIA Section 313(c) a brief report dated as of such May 15, if
required by TIA
Section 313(a).

         SECTION 7.07.  COMPENSATION AND INDEMNITY.  The Company shall pay to
the Trustee such compensation as shall be agreed upon in writing for its
services.  The compensation of the Trustee shall not be limited by any law on
compensation of a trustee of an express trust.  The Company shall reimburse the
Trustee upon request for all reasonable out-of-pocket expenses and advances
incurred or made by the Trustee.  Such expenses shall include the reasonable
compensation and expenses of the Trustee's agents and counsel.

<PAGE>

                                          61

         The Company shall indemnify the Trustee for, and hold it harmless
against, any loss or liability or expense incurred (including, without
limitation, reasonable attorneys' fees) by it without negligence or bad faith on
its part in connection with the acceptance or administration of this Indenture
and its duties under this Indenture and the Notes, including the costs and
expenses of defending itself against any claim or liability and of complying
with any process served upon it or any of its officers in connection with the
exercise or performance of any of its powers or duties under this Indenture and
the Notes.

         The obligation of the Company under this Section 7.07 shall survive
the resignation or removal of the Trustee, the satisfaction and discharge of
this Indenture or the termination of this Indenture.

         To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a lien prior to the Notes on all money or property held or
collected by the Trustee, in its capacity as Trustee, except money or property
held in trust to pay principal of, premium, if any, and interest on particular
Notes.  Such lien shall survive the resignation or removal of the Trustee, the
satisfaction and discharge of this Indenture or the termination of this
Indenture.

         If the Trustee incurs expenses or renders services after the
occurrence of an Event of Default specified in clause (f) or (g) of Section
6.01, the expenses and the compensation for the services will be intended to
constitute expenses of administration under the United States Bankruptcy Code or
any applicable federal or state law for the relief of debtors.

         SECTION 7.08.  REPLACEMENT OF TRUSTEE.  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 7.08.

         The Trustee may resign at any time by so notifying the Company in
writing at least 30 days prior to the date of the proposed resignation.  The
Holders of a majority in principal amount of the outstanding Notes may remove
the Trustee by so notifying the Trustee in writing and may appoint a successor
Trustee with the consent of the Company.  The Company may remove the Trustee if:
(i) the Trustee is no longer eligible under Section 7.10; (ii) the Trustee is
adjudged a bankrupt or an insolvent; (iii) a receiver or other public officer
takes charge of the Trustee or its property; or (iv) 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 promptly appoint a successor
Trustee.  Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.  If
the successor Trustee does not deliver its written acceptance required by the
next succeeding paragraph of this Section 7.08 within 30 days

<PAGE>

                                          62

after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company or the Holders of a majority in principal amount of the outstanding
Notes may petition any court of competent jurisdiction for the appointment of a
successor Trustee.

         A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company.  Immediately after the
delivery of such written acceptance, provided all sums owing to the Trustee
hereunder shall have been paid and subject to the lien provided in Section 7.07,
(i) the retiring Trustee shall transfer all property held by it as Trustee to
the successor Trustee, (ii) the resignation or removal of the retiring Trustee
shall become effective and (iii) 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 the Trustee is no longer eligible under Section 7.10, any Holder
who satisfies the requirements of TIA Section 310(b) may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.

         The Company shall give notice of any resignation and any removal of
the Trustee and each appointment of a successor Trustee to all Holders.  Each
notice shall include the name of the successor Trustee and the address of its
Corporate Trust Office.

         Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Company's obligation under Section 7.07 shall continue for the benefit
of the retiring Trustee.

         SECTION 7.09.  SUCCESSOR TRUSTEE BY MERGER, ETC.  If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business to, another corporation or national banking
association, the resulting, surviving or transferee corporation or national
banking association without any further act shall be the successor Trustee with
the same effect as if the successor Trustee had been named as the Trustee
herein.

         SECTION 7.10.  ELIGIBILITY.  This Indenture shall always have a
Trustee who satisfies the requirements of TIA Section 310(a)(1).  The Trustee
shall have a combined capital and surplus of at least $25 million as set forth
in its most recent published annual report of condition.

         SECTION 7.11.  MONEY HELD IN TRUST.  The Trustee shall not be liable
for interest on any money received by it except as the Trustee may agree with
the Company.  Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law and except for money held in
trust under Article Eight of this Indenture.

<PAGE>

                                          63

         SECTION 7.12.  WITHHOLDING TAXES.  The Trustee, as agent for the
Company, shall exclude and withhold from each payment of principal and interest
and other amounts due hereunder or under the Notes any and all withholding taxes
applicable thereto as required by law.  The Trustee agrees to act as such
withholding agent and, in connection therewith, whenever any present or future
taxes or similar charges are required to be withheld with respect to any amounts
payable in respect of the Notes, to withhold such amounts and timely pay the
same to the appropriate authority in the name of and on behalf of the holders of
the Notes, that it will file any necessary withholding tax returns or statements
when due, and that, as promptly as possible after the payment thereof, it will
deliver to each Holder of a Note appropriate documentation showing the payment
thereof, together with such additional documentary evidence as such Holders may
reasonably request from time to time.


                                    ARTICLE EIGHT
                                DISCHARGE OF INDENTURE

         SECTION 8.01.  TERMINATION OF COMPANY'S OBLIGATIONS.  Except as
otherwise provided in this Section 8.01, the Company may terminate its
obligations under the Notes and this Indenture if:

         (i)    all Notes previously authenticated and delivered (other than
    destroyed, lost or stolen Notes that have been replaced or Notes that are
    paid pursuant to Section 4.01 or Notes for whose payment money or
    securities have theretofore been held in trust and thereafter repaid to the
    Company, as provided in Section 8.05) have been delivered to the Trustee
    for cancellation and the Company has paid all sums payable by it hereunder;
    or

         (ii)   (A) the Notes mature within one year or all of them are to be
    called for redemption within one year under arrangements satisfactory to
    the Trustee for giving the notice of redemption, (B) the Company
    irrevocably deposits in trust with the Trustee during such one-year period,
    under the terms of an irrevocable trust agreement in form and substance
    satisfactory to the Trustee, as trust funds solely for the benefit of the
    Holders for that purpose, money or U.S. Government Obligations sufficient
    (in the opinion of a nationally recognized firm of independent public
    accountants expressed in a written certification thereof delivered to the
    Trustee), without consideration of any reinvestment of any interest
    thereon, to pay principal, premium, if, any, and interest on the Notes to
    maturity or redemption, as the case may be, and to pay all other sums
    payable by it hereunder, (C) no Default or Event of Default with respect to
    the Notes shall have occurred and be continuing on the date of such
    deposit, (D) such deposit will not result in a breach or violation of, or
    constitute a default under, this Indenture or any other agreement or
    instrument to which the Company is a party or by which it is bound and (E)
    the Company has delivered to the Trustee an Officers' Certificate and an
    Opinion of Counsel, in each

<PAGE>

                                          64

    case stating that all conditions precedent provided for herein relating to
    the satisfaction and discharge of this Indenture have been complied with.

         With respect to the foregoing clause (i), the Company's obligations
under Section 7.07 shall survive.  With respect to the foregoing clause (ii),
the Company's obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.08,
2.09, 2.14, 4.01, 4.02, 7.07, 7.08, 8.04, 8.05, and 8.06 shall survive until the
Notes are no longer outstanding.  Thereafter, only the Company's obligations in
Sections 7.07, 8.05 and 8.06 shall survive.  After any such irrevocable deposit,
the Trustee upon request shall acknowledge in writing the discharge of the
Company's obligations under the Notes and this Indenture except for those
surviving obligations specified above.

         SECTION 8.02.  DEFEASANCE AND DISCHARGE OF INDENTURE.  The Company
will be deemed to have paid and will be discharged from any and all obligations
in respect of the Notes on the 123rd day after the date of the deposit referred
to in clause (A) of this Section 8.02, and the provisions of this Indenture will
no longer be in effect with respect to the Notes, and the Trustee, at the
expense of the Company, shall execute proper instruments acknowledging the same,
except as to (i) rights of registration of transfer and exchange, (ii)
substitution of apparently mutilated, defaced, destroyed, lost or stolen Notes,
(iii) rights of Holders to receive payments of principal thereof and interest
thereon, (iv) the Company's obligations under Section 4.02, (v) the rights,
obligations and immunities of the Trustee hereunder and (vi) the rights of the
Holders as beneficiaries of this Indenture with respect to the property so
deposited with the Trustee payable to all or any of them; PROVIDED that the
following conditions shall have been satisfied:

         (A)    with reference to this Section 8.02, the Company has
    irrevocably deposited or caused to be irrevocably deposited with the
    Trustee (or another trustee satisfying the requirements of Section 7.10 of
    this Indenture) and conveyed all right, title and interest for the benefit
    of the Holders, under the terms of an irrevocable trust agreement in form
    and substance satisfactory to the Trustee as trust funds in trust,
    specifically pledged to the Trustee for the benefit of the Holders as
    security for payment of the principal of, premium, if any, and interest, if
    any, on the Notes, and dedicated solely to, the benefit of the Holders, in
    and to (1) money in an amount, (2) U.S. Government Obligations that,
    through the payment of interest, premium, if any, and principal in respect
    thereof in accordance with their terms, will provide, not later than one
    day before the due date of any payment referred to in this clause (A),
    money in an amount or (3) a combination thereof in an amount sufficient, in
    the opinion of a nationally recognized firm of independent public
    accountants expressed in a written certification thereof delivered to the
    Trustee, to pay and discharge, without consideration of the reinvestment of
    such interest and after payment of all federal, state and local taxes or
    other charges and assessments in respect thereof payable by the Trustee,
    the principal of, premium, if any, and accrued interest on the outstanding
    Notes at the Stated Maturity of such principal or interest; PROVIDED that
    the Trustee

<PAGE>

                                          65

    shall have been irrevocably instructed to apply such money or the proceeds
    of such U.S. Government Obligations to the payment of such principal,
    premium, if any, and interest with respect to the Notes;

         (B)    such deposit will not result in a breach or violation of, or
    constitute a default under, this Indenture or any other agreement or
    instrument to which the Company is a party or by which it is bound;

         (C)    immediately after giving effect to such deposit on a pro forma
    basis, no Default or Event of Default shall have occurred and be continuing
    on the date of such deposit or during the period ending on the 123rd day
    after such date of deposit;

         (D)    the Company shall have delivered to the Trustee (1) either (x)
    a ruling directed to the Trustee received from the Internal Revenue Service
    to the effect that the Holders will not recognize income, gain or loss for
    federal income tax purposes as a result of the Company's exercise of its
    option under this Section 8.02 and will be subject to federal income tax on
    the same amount and in the same manner and at the same times as would have
    been the case if such option had not been exercised or (y) an Opinion of
    Counsel to the same effect as the ruling described in clause (x) above
    accompanied by a ruling to that effect published by the Internal Revenue
    Service, unless there has been a change in the applicable federal income
    tax law since the date of this Indenture such that a ruling from the
    Internal Revenue Service is no longer required and (2) an Opinion of
    Counsel to the effect that (x) the creation of the defeasance trust does
    not violate the Investment Company Act of 1940 and (y) after the passage of
    123 days following the deposit (except, with respect to any trust funds for
    the account of any Holder who may be deemed to be an "insider" for purposes
    of the United States Bankruptcy Code, after one year following the
    deposit), the trust funds will not be subject to the effect of Section 547
    of the United States Bankruptcy Code or Section 15 of the New York Debtor
    and Creditor Law in a case commenced by or against the Company under either
    such statute, and either (I) the trust funds will no longer remain the
    property of the Company (and therefore will not be subject to the effect of
    any applicable bankruptcy, insolvency, reorganization or similar laws
    affecting creditors' rights generally) or (II) if a court were to rule
    under any such law in any case or proceeding that the trust funds remained
    property of the Company, (a) assuming such trust funds remained in the
    possession of the Trustee prior to such court ruling to the extent not paid
    to the Holders, the Trustee will hold, for the benefit of the Holders, a
    valid and perfected security interest in such trust funds that is not
    avoidable in bankruptcy or otherwise except for the effect of Section
    552(b) of the United States Bankruptcy Code on interest on the trust funds
    accruing after the commencement of a case under such statute and (b) the
    Holders will be entitled to receive adequate protection of their interests
    in such trust funds if such trust funds are used in such case or
    proceeding;

<PAGE>

                                          66

         (E)    if the Notes are then listed on a national securities exchange,
    the Company shall have delivered to the Trustee an Opinion of Counsel to
    the effect that such deposit defeasance and discharge will not cause the
    Notes to be delisted; and

         (F)    the Company has delivered to the Trustee an Officers'
    Certificate and an Opinion of Counsel, in each case stating that all
    conditions precedent provided for herein relating to the defeasance
    contemplated by this Section 8.02 have been complied with.

         Notwithstanding the foregoing, prior to the end of the 123-day (or one
year) period referred to in clause (D)(2)(y) of this Section 8.02, none of the
Company's obligations under this Indenture shall be discharged.  Subsequent to
the end of such 123-day (or one year) period with respect to this Section 8.02,
the Company's obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.08,
2.09, 2.14, 4.01, 4.02, 7.07, 7.08, 8.05 and 8.06 shall survive until the Notes
are no longer outstanding.  Thereafter, only the Company's obligations in
Sections 7.07, 8.05 and 8.06 shall survive.  If and when a ruling from the
Internal Revenue Service or an Opinion of Counsel referred to in clause (D)(1)
of this Section 8.02 is able to be provided specifically without regard to, and
not in reliance upon, the continuance of the Company's obligations under Section
4.01, then the Company's obligations under such Section 4.01 shall cease upon
delivery to the Trustee of such ruling or Opinion of Counsel and compliance with
the other conditions precedent provided for herein relating to the defeasance
contemplated by this Section 8.02.

         After any such irrevocable deposit, the Trustee upon request shall
acknowledge in writing the discharge of the Company's obligations under the
Notes and this Indenture except for those surviving obligations in the
immediately preceding paragraph.

         SECTION 8.03.  DEFEASANCE OF CERTAIN OBLIGATIONS.  The Company may
omit to comply with any term, provision or condition set forth in clauses (iii)
and (iv) of Section 5.01 and Sections 4.03 through 4.18, and clauses (c) and (d)
of Section 6.01 with respect to clauses (iii) and (iv) of Section 5.01 and
Sections 4.03 through 4.18, and clauses (e) and (f) of Section 6.01 shall be
deemed not to be Events of Default, in each case with respect to the outstanding
Notes if:

         (i)    with reference to this Section 8.03, the Company has
    irrevocably deposited or caused to be irrevocably deposited with the
    Trustee (or another trustee satisfying the requirements of Section 7.10)
    and conveyed all right, title and interest to the Trustee for the benefit
    of the Holders, under the terms of an irrevocable trust agreement in form
    and substance satisfactory to the Trustee as trust funds in trust,
    specifically pledged to the Trustee for the benefit of the Holders as
    security for payment of the principal of, premium, if any, and interest, if
    any, on the Notes, and dedicated solely to, the benefit of the Holders, in
    and to (A) money in an amount, (B) U.S. Government Obligations that,
    through the payment of interest and principal in respect thereof in
    accordance with their terms, will provide, not later than one day

<PAGE>

                                          67

    before the due date of any payment referred to in this clause (i), money in
    an amount or (C) a combination thereof in an amount sufficient, in the
    opinion of a nationally recognized firm of independent public accountants
    expressed in a written certification thereof delivered to the Trustee, to
    pay and discharge, without consideration of the reinvestment of such
    interest and after payment of all federal, state and local taxes or other
    charges and assessments in respect thereof payable by the Trustee, the
    principal of, premium, if any, and interest on the outstanding Notes on the
    Stated Maturity of such principal or interest; PROVIDED that the Trustee
    shall have been irrevocably instructed to apply such money or the proceeds
    of such U.S. Government Obligations to the payment of such principal,
    premium, if any, and interest with respect to the Notes;

         (ii)   such deposit will not result in a breach or violation of, or
    constitute a default under, this Indenture or any other agreement or
    instrument to which the Company is a party or by which it is bound;

         (iii)  no Default or Event of Default shall have occurred and be
    continuing on the date of such deposit;

         (iv)   the Company has delivered to the Trustee an Opinion of Counsel
    to the effect that (A) the creation of the defeasance trust does not
    violate the Investment Company Act of 1940, (B) the Holders have a valid
    first-priority security interest in the trust funds, (C) the Holders will
    not recognize income, gain or loss for federal income tax purposes as a
    result of such deposit and defeasance of certain obligations and will be
    subject to federal income tax on the same amount and in the same manner and
    at the same times as would have been the case if such deposit and
    defeasance had not occurred and (D) after the passage of 123 days following
    the deposit (except, with respect to any trust funds for the account of any
    Holder who may be deemed to be an "insider" for purposes of the United
    States Bankruptcy Code, after one year following the deposit), the trust
    funds will not be subject to the effect of Section 547 of the United States
    Bankruptcy Code or Section 15 of the New York Debtor and Creditor Law in a
    case commenced by or against the Company under either such statute, and
    either (1) the trust funds will no longer remain the property of the
    Company (and therefore will not be subject to the effect of any applicable
    bankruptcy, insolvency, reorganization or similar laws affecting creditors'
    rights generally) or (2) if a court were to rule under any such law in any
    case or proceeding that the trust funds remained property of the Company,
    (x) assuming such trust funds remained in the possession of the Trustee
    prior to such court ruling to the extent not paid to the Holders, the
    Trustee will hold, for the benefit of the Holders, a valid and perfected
    security interest in such trust funds that is not avoidable in bankruptcy
    or otherwise (except for the effect of Section 552(b) of the United States
    Bankruptcy Code on interest on the trust funds accruing after the
    commencement of a case under such statute), (y) the Holders will be
    entitled to receive adequate protection of their interests in such trust
    funds if such trust funds are used in such case or proceeding

<PAGE>

                                          68

    and (z) no property, rights in property or other interests granted to the
    Trustee or the Holders in exchange for, or with respect to, such trust
    funds will be subject to any prior rights of holders of other Indebtedness
    of the Company or any of its Subsidiaries;

         (v)    if the Notes are then listed on a national securities exchange,
    the Company shall have delivered to the Trustee an Opinion of Counsel to
    the effect that such deposit defeasance and discharge will not cause the
    Notes to be delisted; and

         (vi)   the Company has delivered to the Trustee an Officers'
    Certificate and an Opinion of Counsel, in each case stating that all
    conditions precedent provided for herein relating to the defeasance
    contemplated by this Section 8.03 have been complied with.

         SECTION 8.04.  APPLICATION OF TRUST MONEY.  Subject to Section 8.06,
the Trustee or Paying Agent shall hold in trust money or U.S. Government
Obligations deposited with it pursuant to Section 8.01, 8.02 or 8.03, as the
case may be, and shall apply the deposited money and the money from U.S.
Government Obligations in accordance with the Notes and this Indenture to the
payment of principal of, premium, if any, and interest on the Notes; but such
money need not be segregated from other funds except to the extent required by
law.

         SECTION 8.05.  REPAYMENT TO COMPANY.  Subject to Sections 7.07, 8.01,
8.02 and 8.03, the Trustee and the Paying Agent shall promptly pay to the
Company upon request set forth in an Officers' Certificate any excess money held
by them at any time and thereupon shall be relieved from all liability with
respect to such money.  The Trustee and the Paying Agent shall pay to the
Company upon request any money held by them for the payment of principal,
premium, if any, or interest that remains unclaimed for two years; PROVIDED that
the Trustee or such Paying Agent before being required to make any payment may
cause to be published at the expense of the Company once in a newspaper of
general circulation in The City of New York or mail to each Holder entitled to
such money at such Holder's address (as set forth in the Security Register)
notice that such money remains unclaimed and that after a date specified therein
(which shall be at least 30 days from the date of such publication or mailing)
any unclaimed balance of such money then remaining will be repaid to the
Company.  After payment to the Company, Holders entitled to such money must look
to the Company for payment as general creditors unless an applicable law
designates another Person, and all liability of the Trustee and such Paying
Agent with respect to such money shall cease.

         SECTION 8.06.  REINSTATEMENT.  If the Trustee or Paying Agent is
unable to apply any money or U.S. Government Obligations in accordance with
Section 8.01, 8.02 or 8.03, as the case may be, by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's obligations under this Indenture and the Notes

<PAGE>

                                          69

shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.01, 8.02 or 8.03, as the case may be, until such time as the Trustee
or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with Section 8.01, 8.02 or 8.03, as the case may be;
PROVIDED that, if the Company has made any payment of principal of, premium, if
any, or interest on any Notes because of the reinstatement of its obligations,
the Company shall be subrogated to the rights of the Holders of such Notes to
receive such payment from the money or U.S. Government Obligations held by the
Trustee or Paying Agent.


                                     ARTICLE NINE
                         AMENDMENTS, SUPPLEMENTS AND WAIVERS

         SECTION 9.01.  WITHOUT CONSENT OF HOLDERS.  The Company, when
authorized by a Board Resolution, and the Trustee may amend or supplement this
Indenture or the Notes without notice to or the consent of any Holder:

         (1)    to cure any ambiguity, defect or inconsistency in this
    Indenture; PROVIDED that such amendments or supplements shall not adversely
    affect the interests of the Holders in any material respect;

         (2)    to comply with Article Five;

         (3)    to comply with Section 4.07, provided that Section 4.07 may not
    be amended under this Section 9.01;

         (4)    to comply with any requirements of the Commission in connection
    with the qualification of this Indenture under the TIA;

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

         (6)    to make any change that does not materially and adversely
    affect the rights of any Holder.

         SECTION 9.02.  WITH CONSENT OF HOLDERS.  Subject to Sections 6.04 and
6.07 and without prior notice to the Holders, the Company, when authorized by
its Board of Directors (as evidenced by a Board Resolution), and the Trustee may
amend this Indenture and the Notes with the written consent of the Holders of a
majority in principal amount of the Notes then outstanding, and the Holders of a
majority in principal amount of the Notes then outstanding by written notice to
the Trustee may waive future compliance by the Company with any provision of
this Indenture or the Notes.

<PAGE>

                                          70

         Notwithstanding the provisions of this Section 9.02, without the
consent of each Holder affected, an amendment or waiver, including a waiver
pursuant to Section 6.04, may not:

         (i)    change the Stated Maturity of the principal of, or any
    installment of interest on, any Note, or reduce the principal amount
    thereof or the rate of interest thereon or any premium payable upon the
    redemption thereof, or adversely affect any right of repayment at the
    option of any Holder of any Note, or change any place of payment where, or
    the currency in which, any Note or any premium or the interest thereon is
    payable, or impair the right to institute suit for the enforcement of any
    such payment on or after the Stated Maturity thereof (or, in the case of
    redemption, on or after the Redemption Date);

         (ii)   reduce the percentage in principal amount of outstanding Notes
    the consent of whose Holders is required for any such supplemental
    indenture, for any waiver of compliance with certain provisions of this
    Indenture or certain Defaults and their consequences provided for in this
    Indenture;

         (iii)  waive a Default in the payment of principal of, premium, if
    any, or interest on, any Note; or

         (iv)   modify any of the provisions of this Section 9.02, except to
    increase any such percentage or to provide that certain other provisions of
    this Indenture cannot be modified or waived without the consent of the
    Holder of each outstanding Note affected thereby.

         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, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver.  The Company will
mail supplemental indentures to Holders upon request.  Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture or waiver.

         SECTION 9.03.  REVOCATION AND EFFECT OF CONSENT.  Until an amendment
or waiver becomes effective, a consent to it by a Holder is a continuing consent
by the Holder and every subsequent Holder of a Note or portion of a Note that
evidences the same debt as the Note of the consenting Holder, even if notation
of the consent is not made on any Note.  However, any such Holder or subsequent
Holder may revoke the consent as to its Note or portion of its Note.  Such
revocation shall be effective only if the Trustee receives the notice of
revocation before the date the amendment, supplement or waiver becomes
effective.  An

<PAGE>

                                          71

amendment, supplement or waiver shall become effective on receipt by the Trustee
of written consents from the Holders of the requisite percentage in principal
amount of the outstanding Notes.

         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,
supplement or waiver.  If a record date is fixed, then, notwithstanding the last
two sentences 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 consent to such amendment, supplement or waiver or
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 90 days after such record date.

         After an amendment, supplement or waiver becomes effective, it shall
bind every Holder unless it is of the type described in any of clauses (i)
through (iv) of Section 9.02.  In case of an amendment or waiver of the type
described in clauses (i) through (iv) of Section 9.02, the amendment or waiver
shall bind each Holder who has consented to it and every subsequent Holder of a
Note that evidences the same indebtedness as the Note of the consenting Holder.

         SECTION 9.04.  NOTATION ON OR EXCHANGE OF NOTES.  If an amendment,
supplement or waiver changes the terms of a Note, the Trustee may require the
Holder to deliver it to the Trustee.  The Trustee may place an appropriate
notation on the Note about the changed terms and return it to the Holder and the
Trustee may place an appropriate notation on any Note thereafter authenticated.
Alternatively, if the Company or the Trustee so determines, the Company in
exchange for the Note shall issue and the Trustee shall authenticate a new Note
that reflects the changed terms.

         SECTION 9.05.  TRUSTEE TO SIGN AMENDMENTS, ETC.  The Trustee shall be
entitled to receive, and shall be fully protected in relying upon, in addition
to the other documents required by Section 10.03, an Opinion of Counsel stating
that the execution of any amendment, supplement or waiver authorized pursuant to
this Article Nine is authorized or permitted by this Indenture.  Subject to the
preceding sentence, the Trustee shall sign such amendment, supplement or waiver
if the same does not adversely affect the rights of the Trustee.  The Trustee
may, but shall not be obligated to, execute any such amendment, supplement or
waiver that affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise.

         SECTION 9.06.  CONFORMITY WITH TRUST INDENTURE ACT.  Every
supplemental indenture executed pursuant to this Article Nine shall conform to
the requirements of the TIA as then in effect.

<PAGE>

                                          72


                                     ARTICLE TEN
                                    MISCELLANEOUS

         SECTION 10.01.  TRUST INDENTURE ACT OF 1939.  Prior to the
effectiveness of the Registration Statement, this Indenture shall incorporate
and be governed by the provisions of the TIA that are required to be part of and
to govern indentures qualified under the TIA.  After the effectiveness of the
Registration Statement, this Indenture shall be subject to the provisions of the
TIA that are required to be a part of this Indenture and shall, to the extent
applicable, be governed by such provisions.

         SECTION 10.02.  NOTICES.  Any notice or communication shall be
sufficiently given if in writing and delivered in person or mailed by first
class mail addressed as follows:

         if to the Company:
         -----------------

                LodgeNet Entertainment Corporation
                808 West Avenue North
                Sioux Falls, South Dakota 57104
                Attention:  General Counsel

         if to the Trustee:
         -----------------

                Marine Midland Bank
                140 Broadway
                12th Floor
                New York, New York 10005-1180
                Attention:  Corporate Trust Administration Department

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

         Any notice or communication mailed to a Holder shall be mailed to him
at his address as it appears on the Security Register by first class mail and
shall be sufficiently given to him if so mailed within the time prescribed.
Copies of any such communication or notice to a Holder shall also be mailed to
the Trustee and each Agent at the same time.

         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.  Except for a
notice to the Trustee, which is deemed given only when received, and except as
otherwise provided in this Indenture, if a notice or communication is mailed in
the manner provided in this Section 10.02, it is duly given, whether or not the
addressee receives it.

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

<PAGE>

                                          73

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

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

         SECTION 10.03.  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:

         (i)    an Officers' Certificate stating that, in the opinion of the
    signers, all conditions precedent, if any, provided for in this Indenture
    relating to the proposed action have been complied with; and

         (ii)   an Opinion of Counsel stating that, in the opinion of such
    Counsel, all such conditions precedent have been complied with.

         SECTION 10.04.  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:

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

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

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

         (iv)   a statement as to whether or not, in the opinion of each such
    person, such condition or covenant has been complied with; PROVIDED,
    HOWEVER, that, with respect to matters of fact, an Opinion of Counsel may
    rely on an Officers' Certificate or certificates of public officials.

         SECTION 10.05.  RULES BY TRUSTEE, PAYING AGENT OR REGISTRAR.  The
Trustee may make reasonable rules for action by or at a meeting of Holders.  The
Paying Agent or Registrar may make reasonable rules for its functions.

<PAGE>

                                          74

         SECTION 10.06.  PAYMENT DATE OTHER THAN A BUSINESS DAY.  If an
Interest Payment Date, Redemption Date, Change of Control Payment Date, Excess
Proceeds Payment Date, Stated Maturity or date of maturity of any Note shall not
be a Business Day, then payment of principal of, premium, if any, or interest on
such Note, as the case may be, need not be made on such date, but may be made on
the next succeeding Business Day with the same force and effect as if made on
the Interest Payment Date, Change of Control Payment Date, Excess Proceeds
Payment Date, or Redemption Date, or at the Stated Maturity or date of maturity
of such Note; PROVIDED that no interest shall accrue for the period from and
after such Interest Payment Date, Change of Control Payment Date, Excess
Proceeds Payment Date, Redemption Date, Stated Maturity or date of maturity, as
the case may be.

         SECTION 10.07.  GOVERNING LAW.  The laws of the State of New York
shall govern this Indenture and the Notes.  The Trustee, the Company and the
Holders agree to submit to the jurisdiction of the courts of the State of New
York in any action or proceeding arising out of or relating to this Indenture or
the Notes.

         SECTION 10.08.  NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.  This
Indenture may not be used to interpret another indenture, loan or debt agreement
of the Company or any Subsidiary of the Company.  Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.

         SECTION 10.09.  NO RECOURSE AGAINST OTHERS.  No recourse for the
payment of the principal of, premium, if any, or interest on any of the Notes,
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 contained in
this Indenture, or in any of the Notes, or because of the creation of any
Indebtedness represented thereby, shall be had against any incorporator or
against any past, present or future partner, shareholder, other equityholder,
officer, director, employee or controlling person, as such, of the Company or of
any successor Person, either directly or through the Company or any successor
Person, whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise; it being expressly
understood that all such liability is hereby expressly waived and released as a
condition of, and as a consideration for, the execution of this Indenture and
the issue of the Notes.

         SECTION 10.10.  SUCCESSORS.  All agreements of the Company in this
Indenture and the Notes shall bind its successors.  All agreements of the
Trustee in this Indenture shall bind its successor.

         SECTION 10.11.  DUPLICATE 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.

<PAGE>

                                          75

         SECTION 10.12.  SEPARABILITY.  In case any provision in this Indenture
or in the Notes 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 10.13.  TABLE OF CONTENTS, HEADINGS, ETC.  The Table of
Contents, Cross-Reference Table and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not to
be considered a part hereof and shall in no way modify or restrict any of the
terms and provisions hereof.
<PAGE>


                                      SIGNATURES

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


                             LODGENET ENTERTAINMENT CORPORATION


                             By: /s/ Jeffrey T. Welsner
                                --------------------------------
                                  Name: Jeffrey T. Welsner
                                  Title: Vice President - Finance, Treasurer



                             MARINE MIDLAND BANK,
                                  as Trustee


                             By:  /s/ Frank Godino
                                ---------------------------------
                                  Name:  FRANK GODINO
                                  Title: ASSISTANT VICE PRESIDENT

<PAGE>

                                                                       EXHIBIT A


                                    [FACE OF NOTE]

                          LODGENET ENTERTAINMENT CORPORATION

                             10 1/4% Senior Note due 2006

                                                      [CUSIP] [CINS][__________]


No.                                                                   $_________


         LODGENET ENTERTAINMENT CORPORATION, a Delaware corporation (the
"Company", which term includes any successor under the Indenture hereinafter
referred to), for value received, promises to pay to [_____________], or its
registered assigns, the principal sum of [____________] ($[____]) on December
15, 2006.

         Interest Payment Dates:  June 15, and December 15, commencing June 15,
1997.

         Regular Record Dates:   June 1 and  December 1.

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

<PAGE>

                                         A-2

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


Date: December 19, 1996                LODGENET ENTERTAINMENT CORPORATION


                                  By:_____________________________
                                       Name:
                                       Title:






Attest:____________________________
    Name:
    Title:



                      (Trustee's Certificate of Authentication)

This is one of the 10 1/4% Senior Notes due 2006 described in the
within-mentioned Indenture.


                                  MARINE MIDLAND BANK,
                                       as Trustee


                                  By:_____________________________
                                       Authorized Signatory

<PAGE>

                                         A-3



                                [REVERSE SIDE OF NOTE]

                          LODGENET ENTERTAINMENT CORPORATION

                             10 1/4% Senior Note due 2006



1.  PRINCIPAL AND INTEREST.

         The Company will pay the principal of this Note on December 15, 2006.

         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 semiannually (to the holders of record of the
Notes at the close of business on the June 1 or December 1 immediately preceding
the Interest Payment Date) on each Interest Payment Date, commencing June 15,
1997.

         If an exchange offer ("Exchange Offer") registered under the
Securities Act is not consummated, or a shelf registration statement under the
Securities Act with respect to resales of the Notes is not declared effective by
the Commission, on or before June 19, 1997 in accordance with the terms of the
Registration Rights Agreement ("Registration Rights Agreement") dated December
16, 1996 between the Company and Morgan Stanley & Co. Incorporated, NatWest
Capital Markets Limited and Montgomery Securities, the annual interest rate
borne by the Notes shall be increased by 0.5% from the rate shown above accruing
from December 19, 1996, payable in cash semiannually, in arrears, on each June
15 and December 15, commencing December 15, 1997 and if the Exchange Offer is
not consummated, or a shelf registration statement under the Securities Act with
respect to the resale of the Notes is not declared effective by the Commission,
on or before September 19, 1997 in accordance with the terms of the Registration
Rights Agreement, the annual interest rate borne by the Notes shall be increased
by an additional 0.5% per annum.  Once the Exchange Offer is consummated or a
shelf registration statement is declared effective, the annual interest rate
borne by the Notes shall be changed to again be the rate shown above.  The
Holder of this Note is entitled to the benefits of such Registration Rights
Agreement.

         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 December 19, 1996;
PROVIDED that, if there is no existing default in the payment of interest and
this Note is authenticated between a Regular Record Date referred to on the face
hereof 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.

<PAGE>

                                         A-4


         The Company shall pay interest on overdue principal and premium, if
any, and interest on overdue installments of interest, to the extent lawful, at
a rate per annum that is 2% in excess of the rate otherwise payable.

2.  METHOD OF PAYMENT.

         The Company will pay interest (except defaulted interest) on the
principal amount of the Notes as provided above on each June 15 and December 15
to the persons who are Holders (as reflected in the Security Register at the
close of business on such June 1 and December 1 immediately preceding the
Interest Payment Date), in each case, even if the Note is cancelled on
registration of transfer or registration of exchange after such record date;
PROVIDED that, with respect to the payment of principal, the Company will make
payment to the Holder that surrenders this Note to a Paying Agent on or after
December 15, 2006.

         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 principal, premium, if any, and interest by its check payable in such money.
It may mail an interest check 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, the Trustee will act as authenticating agent, Paying Agent
and Registrar.  The Company may change any authenticating agent, Paying Agent or
Registrar without notice.  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 December
19, 1996 (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 terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act.  The Notes are subject to all such terms, and Holders are
referred to the Indenture and the Trust Indenture Act 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, general obligations of the Company.  The
Indenture limits the original aggregate principal amount of the Notes to
$150,000,000.

<PAGE>

                                         A-5


5.  REDEMPTION.

         The Notes will be redeemable, at the Company's option, in whole or in
part, at any time on or after December 15, 2001 and prior to maturity, upon not
less than 30 nor more than 60 days' prior notice mailed by first-class mail to
each Holder's last address as it appears in the Security Register, at the
following Redemption Prices (expressed in percentages of their principal
amount), 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), if redeemed during the 12-month period commencing on
December 15 of the applicable year set forth below:

                                            Redemption
              Year                             Price
              ----                          -----------
              2001                           105.125%
              2002                           102.563
              2003 and thereafter            100.000

         Notes in original denominations larger than $1,000 may be redeemed in
part.  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.

         In addition, at any time prior to December 15, 1999, the Company may
redeem up to 35% of the aggregate principal amount of the Notes with the
proceeds of one or more Public Equity Offerings, at any time as a whole or from
time to time in part, at a Redemption Price (expressed as a percentage of
principal amount on the Redemption Date) of 110.250%, plus accrued and unpaid
interest, if any, to the redemption date; provided that, immediately after any
such redemption at least $97.5 million aggregate principal amount of the Notes
remains outstanding.

6.  REPURCHASE UPON CHANGE OF 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
principal amount thereof on the relevant Payment Date, plus accrued and unpaid
interest, if any, to the Payment Date.

         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.  On and after the 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 purchase price.

<PAGE>

                                         A-6

7.  DENOMINATIONS; TRANSFER; EXCHANGE.

         The Notes are in registered form without coupons in denominations of
$1,000 of principal amount and multiples of $1,000 in excess 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 of 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.

8.  PERSONS DEEMED OWNERS.

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

9.  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 abandoned property law
designates another Person, and all liability of the Trustee and such Paying
Agent with respect to such money shall cease.

10.  DISCHARGE PRIOR TO REDEMPTION OR MATURITY.

         If the Company deposits with the Trustee money or U.S. Government
Obligations sufficient to pay the then outstanding principal of, premium, if
any, and accrued interest on the Notes (a) to redemption or maturity, the
Company will be discharged from the Indenture and the Notes, except in certain
circumstances for certain sections thereof, and (b) to the Stated Maturity, the
Company will be discharged from certain covenants set forth in the Indenture.

11.  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 principal amount of the Notes then outstanding, and any existing default or
compliance with any provision may be waived with the consent of the Holders of
at least a majority in principal amount 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.

<PAGE>

                                         A-7


12.  RESTRICTIVE COVENANTS.

         The Indenture imposes certain limitations on the ability of the
Company and its Restricted Subsidiaries, among other things, to Incur additional
Indebtedness, make Restricted Payments, use the proceeds from Asset Sales,
engage in transactions with Affiliates or merge, consolidate or transfer
substantially all of its assets.  Within 45 days after the end of each fiscal
quarter (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.

13.  SUCCESSOR PERSONS.

         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.

14.  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)
any Note when the same becomes due and payable at maturity, upon acceleration,
redemption or otherwise; (b) default in the payment of interest on any Note when
the same becomes due and payable, and such default continues for a period of
30 days; (c) default in the performance or breach of the provisions of the
Indenture applicable to mergers, consolidations and transfers of all or
substantially all of the assets of the Company or the failure to make or
consummate an Offer to Purchase in accordance with Section 4.11 or 4.12 of the
Indenture; (d) the Company defaults in the performance of or breaches any other
covenant or agreement of the Company in the Indenture or under the Notes (other
than a default specified in clause (a), (b) or (c) above) 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 of the
Notes; (e) there occurs with respect to any issue or issues of Indebtedness of
the Company or any Significant Subsidiary having an outstanding principal amount
of $10 million or more in the aggregate for all such issues of all such Persons,
whether such Indebtedness now exists or shall hereafter be created, (I) 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 (II) the failure to make a principal
payment at the final (but not any interim) 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 $10 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

<PAGE>

                                         A-8

or discharged against all such Persons to exceed $10 million 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 or
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 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 or
for all or substantially all of the property and assets of the Company or any of
its Significant Subsidiaries or (C) effects any general assignment for the
benefit of creditors.

         If an Event of Default, as defined in the Indenture, occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the Notes may declare all the Notes to be due and payable.  If a bankruptcy or
insolvency default with respect to the Company or any Restricted Subsidiary
occurs and is continuing, the Notes automatically become 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 of the Notes then outstanding may direct
the Trustee in its exercise of any trust or power.

15.   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.

16.  NO RECOURSE AGAINST OTHERS.

         No incorporator or any past, present or future partner, stockholder,
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.  The
waiver and release are part of the consideration for the issuance of the Notes.

<PAGE>

                                         A-9


17.  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.

18.  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).

         The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture.  Requests may be made to LodgeNet
Entertainment Corporation, 808 West Avenue North, Sioux Falls, South Dakota
57104, Attention:  Vice President -- General Counsel.

<PAGE>

                                         A-10

                              [FORM OF TRANSFER NOTICE]


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

Insert Taxpayer Identification No.
__________________________________

________________________________________________________________________________
Please print or typewrite name and address including zip code of assignee

________________________________________________________________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ___________________________________________________________ attorney
to transfer said Note on the books of the Company with full power of
substitution in the premises.


                       [THE FOLLOWING PROVISION TO BE INCLUDED
                       ON ALL NOTES OTHER THAN EXCHANGE NOTES,
                         UNLEGENDED OFFSHORE GLOBAL NOTES AND
                         UNLEGENDED OFFSHORE PHYSICAL NOTES]

    In connection with any transfer of this Note occurring prior to the date
which is the earlier of (i) the date the shelf registration statement is
declared effective or (ii) the end of the period referred to in Rule 144(k)
under the Securities Act, the undersigned confirms that without utilizing any
general solicitation or general advertising that:

                                     [CHECK ONE]

[  ] (a) this Note is being transferred in compliance with the exemption from
         registration under the Securities Act provided by Rule 144A
         thereunder.

                                          OR

[  ] (b) this Note is being transferred other than in accordance with (a) above
         and documents are being furnished which comply with the conditions of
         transfer set forth in this Note and the Indenture.

<PAGE>

                                         A-11

If neither of the foregoing boxes is checked, the Trustee or other Registrar
shall not be obligated to register this Note in the name of any Person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.08 of the Indenture shall have
been satisfied.

Date:__________________      _______________________________________
                             NOTICE:  The signature to this assignment must
                             correspond with the name as written upon the face
                             of the within-mentioned instrument in every
                             particular, without alteration or any change
                             whatsoever.



TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.

    The undersigned represents and warrants that it is purchasing this Note for
its own account or an account with respect to which it exercises sole investment
discretion and that it and any such account is a "qualified institutional buyer"
within the meaning of Rule 144A under the Securities Act and is aware that the
sale to it is being made in reliance on Rule 144A and acknowledges that it has
received such information regarding the Company as the undersigned has requested
pursuant to Rule 144A or has determined not to request such information and that
it is aware that the transferor is relying upon the undersigned's foregoing
representations in order to claim the exemption from registration provided by
Rule 144A.

Dated:_________________      _______________________________________________
                             NOTICE:  To be executed by an executive officer

<PAGE>

                                         A-12

                          OPTION OF HOLDER TO ELECT PURCHASE


         If you wish to have this Note purchased by the Company pursuant to
Section 4.11 or Section 4.12 of the Indenture, check the Box:  / /

         If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.11 or Section 4.12 of the Indenture, state the amount:
$___________________.

Date: ______________

Your Signature:_________________________________________________________________
              (Sign exactly as your name appears on the other side of this Note)

Signature Guarantee:  ______________________________


<PAGE>

                                                                       EXHIBIT B


                                 FORM OF CERTIFICATE

                                                        [________________, ____]

Marine Midland Bank
140 Broadway
New York, New York 10005

Attention:  Corporate Trust Administration Department


         Re:  LodgeNet Entertainment Corporation (the "Company")
               10 1/4% Senior Notes due 2006 (the "Notes")
              --------------------------------------------------

Dear Sirs:

         This letter relates to U.S. $[_________] principal amount of Notes
represented by a Note (the "Legended Note") which bears a legend outlining
restrictions upon transfer of such Legended Note.  Pursuant to Section 2.02 of
the Indenture dated as of December 19, 1996 (the "Indenture") relating to the
Notes, we hereby certify that we are (or we will hold such securities on behalf
of) a person outside the United States to whom the Notes could be transferred in
accordance with Rule 904 of Regulation S promulgated under the U.S. Securities
Act of 1933.  Accordingly, you are hereby requested to exchange the legended
certificate for an unlegended certificate representing an identical principal
amount of Notes, all in the manner provided for in the Indenture.

         You and the Company 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 proceedings or official inquiry with
respect to the matters covered hereby.  Terms used in this certificate have the
meanings set forth in Regulation S.

                                       Very truly yours,

                                       [Name of Holder]



                                       By: _______________________________
                                            Authorized Signature

<PAGE>
                                                                       EXHIBIT C



                              Form of Certificate to Be
                             Delivered in Connection with
                      Transfers to Non-QIB Accredited Investors
                      -----------------------------------------

                                        [____________ , ____]


Marine Midland Bank
140 Broadway
New York, New York 10005

Attention:  Corporate Trust Administration Department


         Re:  LodgeNet Entertainment Corporation (the "Company")
              10 1/4% Senior Notes due 2006 (the "Notes")
              --------------------------------------------------

Dear Sirs:

         In connection with our proposed purchase of $[_____________] aggregate
principal amount of the Notes, we confirm that:

         1.  We understand that any subsequent transfer of the Notes is subject
to certain restrictions and conditions set forth in the Indenture dated as of
December 19, 1996 (the "Indenture"), relating to the Notes, and the undersigned
agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes
except in compliance with, such restrictions and conditions and the Securities
Act of 1933 (the "Securities Act").

         2.  We understand that the offer and sale of the Notes have not been
registered under the Securities Act, and that the Notes 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 if we should sell any Notes, we will do so only (A) to the Company or any
subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act to
a "qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Company a signed letter substantially in the form of this letter, (D) outside
the United States in accordance with Rule 904 of Regulation S under the
Securities Act, (E) pursuant to the exemption from registration provided by Rule
144 under the Securities Act, or (F) pursuant to an effective

<PAGE>

                                         C-2

registration statement under the Securities Act, and we further agree to provide
to any person purchasing any of the Notes from us a notice advising such
purchaser that resales of the Notes are restricted as stated herein.

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

         4.  We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) 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 Notes, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.

         5.  We are acquiring the Notes purchased by us for our own account or
for one or more accounts (each of which is an institutional "accredited
investor") as to each of which we exercise sole investment discretion.

         You and the Company 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 proceedings or official inquiry with
respect to the matters covered hereby.

                        Very truly yours,

                        [Name of Transferee]


                        By:_________________________
                             Authorized Signature

<PAGE>

                                                                       EXHIBIT D



                         Form of Certificate to Be Delivered
                            in Connection with Transfers
                              Pursuant to Regulation S
                           --------------------------------

                                            [____________, ____]



Marine Midland Bank
140 Broadway
New York, New York 10005

Attention:  Corporate Trust Administration Department


         Re:  LodgeNet Entertainment Corporation (the "Company")
              10 1/4% Senior Notes due 2006 (the "Notes")
              --------------------------------------------------

Dear Sirs:

         In connection with our proposed sale of U.S.$[___________] aggregate
principal amount of the Notes, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the Securities Act of 1933
and, accordingly, we represent that:

         (1)  the offer of the Notes was not made to a person in the United
States;

         (2)  at the time the buy order was originated, the transferee was
outside the United States or we and any person acting on our behalf reasonably
believed that the transferee was outside the United States;

         (3)  no directed selling efforts have been made by us in the United
States in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable; and

         (4)  the transaction is not part of a plan or scheme to evade the
registration requirements of the U.S. Securities Act of 1933.

<PAGE>

                                         D-2

         You and the Company 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 proceedings or official inquiry with
respect to the matters covered hereby.  Terms used in this certificate have the
meanings set forth in Regulation S.

                        Very truly yours,

                        [Name of Transferor]


                        By:____________________________
                             Authorized Signature