Document:

<PAGE>

                                                                     Exhibit 4.1

                                TRUST AGREEMENT

                                    between

                  NATIONAL FINANCIAL SECURITIES CORPORATION,
                                 as Depositor,

                                      and

               _______________________________________________,
                                  as Trustee

                       for Trust Certificates issued by
                 NFSC Trust 2000-_ for [UNERLYING SECURITIES]
<PAGE>

                             NFSC TRUST 2000-_ FOR

                            [UNDERLYING SECURITIES]

                                TRUST AGREEMENT

         This Trust Agreement (this "Series Trust Agreement"), dated as
of_______ __, 2000, between National Financial Securities Corporation, as
Depositor, and ___________________, as Trustee, for $__,000,000 Trust
Certificates for [UNDERLYING SECURITIES] (the "Certificates"), incorporates by
reference the Standard Terms and Provisions of Series Trust Agreement (the
"Standard Terms") attached as Exhibit B hereto, and is governed by the Standard
Terms as fully as if set forth herein at length. All capitalized terms not
defined herein shall have the same meaning as set forth in the Standard Terms.

                             W I T N E S S E T H:

         SECTION 1.  A Trust is hereby created under the laws of the State of
[New York] and in the manner specified in Article II of the Standard Terms for
the benefit of Holders of the Certificates. The assets of the Trust shall
consist of the securities (referred to herein and in the Standard Terms as the
"Underlying Securities") described in Exhibit A hereto, all distributions
thereon after the date hereof, all right, title and interest in and to such
distributions and all other rights and privileges of the Holders of the
Certificates under this Series Trust Agreement.

         SECTION 2.  The name of the Trust is NFSC Trust 2000-_ for [Underlying
Securities].

         SECTION 3.  The Certificates shall be issued as a single class in the
amount set forth in Exhibit A hereto; shall have the standard terms set forth in
the Standard Terms; and shall have the nonstandard terms set forth in Exhibit A
hereto. Certificates shall be issued in substantially the form of the Form of
Certificate set forth in Exhibit C to this Series Trust Agreement. The
Certificates shall evidence fractional interests in the assets of the Trust,
payable solely from payments received by the Trustee attributable to the
Underlying Securities.

         [SECTION 4. The Depositor hereby authorizes and directs the Trustee to
execute and deliver a letter of representations, in the form customarily
provided to DTC, from the Trustee and the Depositor dated the date of delivery
of the Certificates (the "Letter of Representations"). ]

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Series Trust
Agreement to be executed by their respective duly authorized officers as of the
date first above written.

                                  NATIONAL FINANCIAL SECURITIES CORPORATION,
                                  as Depositor

                                  By__________________________
                                  Name:
                                  Title:

                                  [_________________________],
                                  as Trustee

                                  By__________________________
                                  Name:
                                  Title:

                                     4.1-3
<PAGE>

Exhibit A - Description of the Underlying Securities and the Certificates;
            Description of Certain Terms Used in the Agreement

Exhibit B - Standard Terms and Provisions of Series Trust Agreement

Exhibit C - Form of Certificate

Exhibit D - Officer's Certificate of the Trustee

                                     4.1-4
<PAGE>

                                                                       EXHIBIT A
                                                       TO SERIES TRUST AGREEMENT

        DESCRIPTION OF THE UNDERLYING SECURITIES AND THE CERTIFICATES;
              DESCRIPTION OF CERTAIN TERMS USED IN THE AGREEMENT

Part I - Description of the Underlying Securities

Issuer:  [___________________]

Underlying Securities:     [_______________________________]

Dated:   [_________]

Original Principal Maturity Date:   [_________]

Original Par Value Amount Issued:   $[_________]

CUSIP Number:     [_________]

Stated Interest Rate:      [_________]%

Interest Payment Dates:    [_________]

First Call Date:  [_________]

Redemption Price:   The Underlying Securities are redeemable at any time on or
                    after [_________], in whole or in part from time to time on
                    not less than __ nor more than __ days' notice at the
                    following redemption prices (expressed in percentages of the
                    principal amount) during the 12-month period ending
                    [_________]of each year:

Year                  Price ($)
----                  ---------

and $__ on or  after[_________],  together,  in each
case,  with accrued interest to the redemption date.
<PAGE>

Mode of Payment of Underlying Securities:   [By credit to the account of the
Holder at DTC.]

Record date of Underlying Securities:         [_________]

Event of Default with respect to payment of interest and principal: [An event
        of default under the Indenture exists upon (i) the default in the
        payment of interest for 60 days, or (ii) the default in payment of
        principal (or premium, if any) at maturity.]

Par Value Amount of Underlying Securities Deposited Under Series Trust
        Agreement: $__,000,000

[The Underlying Securities will be held by the Trustee as Book-Entry Credits at
DTC.]

Part II - Description of the Certificates

Classes of Certificates:   Pooled Certificates

Aggregate Face Amount of Pooled Certificate:     $__,000,000

Item Aggregate
Face Minimum
Offered Number     Due Date      CUSIP Number     Amount Offered  Denominations
--------------     --------      ------------     --------------  -------------
1                  [_________]   [_________]      $__,000,000     $__

Part III - Definitions of Certain Terms Used in the Agreement

Authorized Denominations (Section 1.01) $__

Certificate Principal Amount (Section 1.01) $__

Closing Date (Section 1.01) [_________].

Corporate Trust Office (Section 1.01) [_________]

Depositor Address (Section 9.04) National Financial Securities Corporation
                                        909 East Main Street
                                        Richmond, Virginia  23219

Distribution Dates (Section 1.01) [_________]1 and [_________] 1 of each year,
commencing[_________].

                                      A-2
<PAGE>

Indenture (Section 1.01) [_________]

Indenture Trustee (Section 1.01) [_________]

Trustee Address (Section 9.04) [_________]

Rating Agency (Section 1.01) Each of [Moody's Investors Service, Inc.] and
         [Standard & Poor's Ratings Group]

Rating Agency Address (Section 9.04) [Moody's Investors Service, Inc.
                                     99 Church Street
                                     New York, NY 10007]

                                     [Standard & Poor's Ratings Group
                                     26 Broadway, 15th Floor
                                     New York, NY 10004]

Retained Amount (Section 1.01) Interest accrued on the Underlying Securities
         from, and including, [_________]to, but excluding, the Closing Date,
         equal to $[_________]

                                      A-3
<PAGE>

                                                                       EXHIBIT B
                                                       TO SERIES TRUST AGREEMENT

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

            STANDARD TERMS AND PROVISIONS OF SERIES TRUST AGREEMENT

                                    between

                  NATIONAL FINANCIAL SECURITIES CORPORATION,
                                 as Depositor,

                                      and

                                  the Trustee

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

     Relating to Trust Certificates of the Series identified in the Series Trust
Agreement; Reconciliation and Tie between the Trust Indenture Act of 1939 and
Agreement Provisions*

Trust Indenture Act Section                            Agreement Section
310(a)(1)                                              5.01
   (a)(2)                                              5.01
   (a)(3)                                              Not Applicable
   (a)(4)                                              5.02
   (b)                                                 5.11, 5.01
   (c)                                                 Not Applicable
311(a)                                                 5.10
   (b)                                                 5.10
312(a)                                                 6.01, 6.02(a)
   (b)                                                 6.02(b)
   (c)                                                 6.02(c)
313(a)                                                 6.03
   (b)                                                 6.03
   (c)                                                 6.03
   (d)                                                 6.03
314(a)                                                 5.09(a), 5.09(b)
   (b)                                                 5.09(c), 5.09(d)
   (c)(1)                                              5.09(f)
   (c)(2)                                              5.09(f)
   (c)(3)                                              5.09(f)
   (d)(1)                                              5.09(e)
   (d)(2)                                              5.09(e)
   (d)(3)                                              5.09(e)
   (e)                                                 5.09(f)
315(a)                                                 5.08
   (b)                                                 5.02
   (c)                                                 5.02
   (d)                                                 5.08
   (d)(1)                                              5.08
   (d)(2)                                              5.08
   (d)(3)                                              5.08
   (e)                                                 5.13
316(a)(1)(A)                                           5.04
   (a)(1)(B)                                           5.05
   (a)(2)                                              Not Applicable
   (b)                                                 2.08, 4.01
   (c)                                                 2.08, 2.09
   (a)                                                 5.03
317(b)                                                 4.03
3.18(a)                                                9.03

________________________
* This reconciliation and tie shall not, for any purpose, be deemed to be part
of the within agreement.

                                     B-ii
<PAGE>

                               TABLE OF CONTENTS
<TABLE>
<S>                                                                                                                     <C>
ARTICLE I DEFINITIONS.................................................................................................   1
         Section 1.1  Certain Definitions.............................................................................   1
ARTICLE II  CREATION  OF TRUST;  DELIVERY  AND  CUSTODY OF BONDS;  FORM OF  CERTIFICATES;  EXECUTION  AND  DELIVERY,
         SURRENDER  AND REDEMPTION OF CERTIFICATES....................................................................   7
         Section 2.1  Creation of Trust; Delivery and Custody of Underlying Securities; Execution ....................   7
         Section 2.2  Form of Certificates............................................................................   8
         Section 2.3  Registration and Registration of Transfer and Exchange of Certificates..........................   8
         Section 2.4  Limitations on Execution and Delivery, Surrender and Registration of Transfer and Exchange of
               Certificates...........................................................................................   9
         Section 2.5  Mutilated, Destroyed, Lost or Stolen Certificates...............................................   9
         Section 2.6  Persons Deemed Owners...........................................................................  10
         Section 2.7  Cancellation and Destruction of Surrendered Certificates........................................  10
         Section 2.8  Book-Entry.....................................................................................   10
         Section 2.9  Action or Consent of Holders....................................................................  12
         Section 2.10 Transfer of Certificates Held by DTC to Successor Depository....................................  13
         Section 2.11 Temporary Certificates..........................................................................  14
ARTICLE III CERTAIN OBLIGATIONS OF HOLDERS OF CERTIFICATES; DEPOSITOR'S WARRANTIES....................................  14
         Section 3.1  Filing Proofs, Certificates and Other Information...............................................  14
         Section 3.2  Payment of Taxes or Other Governmental Charges..................................................  14
         Section 3.3  Depositor's Warranties..........................................................................  15
ARTICLE IV PAYMENT OF INTEREST AND PRINCIPAL; CUSTODY OF PROCEEDS OF INTEREST AND PRINCIPAL PAYMENTS..................  15
         Section 4.1  Payment of  Interest;  Payment of  Principal;  Mandatory  Exchange of  Callable  Principal
               Certificates and Callable Stripped Underlying Security Certificates....................................  15
         Section 4.2  Segregation of Moneys Received from Issuers in Respect of Underlying Securities.................  17
         Section 4.3  Paying Agent....................................................................................  18
ARTICLE V THE TRUSTEE AND THE DEPOSITOR...............................................................................  18
         Section 5.1  Eligibility of Trustee; Disqualification........................................................  18
         Section 5.2  Trustee's Duties on Default; No Liability of the Trustee or the Depositor on the Underlying
                      Securities......................................................................................  18
         Section 5.3  Collection of Indebtedness  and Suits for Enforcement by Trustee;  Distribution of Amounts
               Received in Respect of Defaulted Underlying Securities.................................................  19
         Section 5.4  Control by Holders..............................................................................  21
         Section 5.5  Waiver of Past Defaults.........................................................................  21
         Section 5.6  Maintenance of Offices and Agencies by the Trustee..............................................  21
         Section 5.7  Prevention of or Delay in Performance by the Trustee or the Depositor...........................  21
         Section 5.8  Liability of the Trustee and the Depositor......................................................  22
         Section 5.9  Obligation of the Depositor.....................................................................  24
         Section 5.10 Preferential Collection of Claims Against Depositor.............................................  27
         Section 5.11 Resignation and Removal of the Trustee; Appointment of Successor Trustee........................  27
         Section 5.12 Indemnification by the Depositor................................................................  29
         Section 5.13 Undertaking for Costs...........................................................................  30
         Section 5.14 Charges and Expenses............................................................................  31
         Section 5.15 Trustee Reports.................................................................................  31
ARTICLE VI  HOLDERS' LISTS AND REPORTS................................................................................  32
</TABLE>

<PAGE>

<TABLE>
<S>                                                                                                                     <C>
         Section 6.1  Depositor to Furnish Names and Addresses of Holders to Trustee.................................   32
         Section 6.2  Preservation of Information, Communications to Holders.........................................   32
         Section 6.3  Reports by Trustee.............................................................................   32
ARTICLE VII  AMENDMENT AND TERMINATION...............................................................................   32
         Section 7.1  Amendment......................................................................................   32
         Section 7.2  Termination....................................................................................   33
ARTICLE VIII REDEMPTION OF CERTIFICATES..............................................................................   33
         Section 8.1  Redemption.....................................................................................   33
         Section 8.2  Notice of Redemption...........................................................................   33
ARTICLE IX  MISCELLANEOUS............................................................................................   34
         Section 9.1  Exclusive Benefit of Parties and Holders of Certificates; Effective Date.......................   34
         Section 9.2  Invalidity of Provisions.......................................................................   34
         Section 9.3  Conflict with Trust Indenture Act..............................................................   34
         Section 9.4  Notices........................................................................................   34
         Section 9.5  Governing Law; Forum...........................................................................   35
         Section 9.6  Headings.......................................................................................   35
         Section 9.7  Covenant of Depositor and Trustee Not to Place Trust in Bankruptcy.............................   35
         Section 9.8  Trust Not to Merge.............................................................................   35
         Section 9.9  Incurrence of Indebtedness.....................................................................   36
</TABLE>

                                     B-iv
<PAGE>

            STANDARD TERMS AND PROVISIONS OF SERIES TRUST AGREEMENT
            -------------------------------------------------------

     This document constitutes Standard Terms and Provisions of Series Trust
Agreement which are to be incorporated by reference in, and attached as Exhibit
B to, one or more series trust deposit agreements (each, a "Series Trust
Agreement") by and among National Financial Securities Corporation, as
Depositor, and the trustee designated therein, as Trustee.

     Each Series Trust Agreement will create a trust under the laws of the State
of New York to hold securities (the "Underlying Securities") and all
distributions thereon and will provide for the creation, execution and delivery
of trust certificates (the "Certificates").

     These Standard Terms shall be of no force and effect unless and until
incorporated by reference into a Series Trust Agreement.

     The following terms and provisions shall govern the Certificates subject to
contrary or additional terms and provisions expressly set forth in a Series
Trust Agreement, which contrary or additional terms and provisions of the Series
Trust Agreement shall control.

                            ARTICLE I  DEFINITIONS

Section 1.1  Certain Definitions.
             -------------------

     All capitalized terms used herein shall have the meaning set forth in this
Section 1.01 unless the context otherwise requires:

     The term "Accreted Value" shall mean, for any Coupon Certificate, Principal
               --------------
Certificate, Callable Principal Certificate or Stripped Coupon Certificate, (a)
the original issue price for such Certificate as set forth in Exhibit A to the
Series Trust Agreement, plus (b) an amount equal to an investment return thereon
accrued to the date of determination calculated based on a semiannual
compounding rate, on the basis of a 360 day year composed of twelve 30-day
months, equal to the original yield to maturity on the Closing Date on such
Certificate as set forth in Exhibit A to the Series Trust Agreement. With
respect to the allocation of proceeds of the Underlying Securities received in
connection with a payment default on the Underlying Securities, the relevant
determination date shall be the Petition Date. With respect to the determination
of Accreted Value in connection with a vote relating to the Underlying
Securities, the relevant determination date shall be a date determined by the
Trustee, which date shall be within fifteen Business Days of the date the
Trustee casts its votes as provided herein.

     The term "Agreement" shall mean the trust deposit agreement consisting of
               ---------
the Series Trust Agreement into which is incorporated by reference the Standard
Terms, including all exhibits, schedules, appendices, supplements and amendments
to each.

     The term "Authorized Denominations" for each class of Certificates shall
               ------------------------
mean the dollar amount, and greater multiples thereof (or of such other dollar
amount specified in the Series Trust Agreement), set forth in the Series Trust
Agreement.
<PAGE>

     The term "Authorized Officer" shall mean any officer of the Depositor who
               ------------------
is authorized to act for the Depositor in matters relating to the Depositor.

     The term "Available Information Event" shall mean that the Issuer has
               ---------------------------
suspended its Exchange Act reporting requirements at a time when the Exchange
Act reporting requirements with respect to the Certificates have not been
suspended or terminated.

     The term "Beneficial Owner" shall mean any purchaser of Certificates which
               ----------------
are held through a Direct or Indirect DTC Participant, as such terms are used in
the rules and regulations of DTC.

     The term "Book-Entry Credit" shall mean the evidence of the deposit by the
               -----------------
Trustee of one or more Underlying Securities in a separate account of the
Trustee, as Trustee under this Agreement, identified in the Series Trust
Agreement.

     The term "Business Day" shall mean a day which is not a day when banking
               ------------
institutions or trust companies in New York City are authorized or obligated by
law, regulation or executive order to remain closed.

     The term "Callable Principal" shall mean the right to receive (i) the
               ------------------
payment, whether upon stated maturity or upon earlier redemption, of the
Principal and redemption premium, if any, of Underlying Securities which are
redeemable at the option of the Issuer thereof prior to stated maturity, and
(ii) the Interest relating to such Underlying Securities with respect to
Interest Payment Dates after the First Call Date for such Underlying Securities,
in each case subject to Section 5.03(b) hereof.

     The term "Certificate" shall mean a certificate of a class of certificates
               -----------
to be issued under this Agreement, which classes are specified in the Series
Trust Agreement for the series. Such classes may consist of:

     (i)    Coupon Certificates, which entitle the Holders thereof, in the
     aggregate, to the Interest payable on a single Interest Payment Date on or
     before the First Call Date for the Underlying Securities, or the stated
     maturity date in the case of Underlying Securities not redeemable
     (otherwise than in connection with a default or acceleration) at the option
     of the Issuer thereof prior to stated maturity:

     (ii)   Principal Certificates, which entitle the Holders thereof, in the
     aggregate, to Principal, payable at the stated maturity of the Underlying
     Securities, of Underlying Securities which are not redeemable (otherwise
     than in connection with a default or acceleration) at the option of the
     Issuer thereof prior to stated maturity.

     (iii)  Callable Principal Certificates, which entitle the Holders thereof,
     in the aggregate, to the Callable Principal relating to the Underlying
     Securities.

                                      B-2
<PAGE>

     (iv)   Stripped Coupon Certificates, which entitle the Holders thereof, in
     the aggregate, to a specified portion (less than 100%) of the Interest
     payable on a single Interest Payment Date on or before the First Call Date
     for the Underlying Securities, or the stated maturity date in the case of
     Underlying Securities not redeemable (otherwise than in connection with a
     default or acceleration) at the option of the Issuer thereof prior to
     stated maturity.

     (v)   Stripped Underlying Security Certificates, which entitle the Holders
     thereof, in the aggregate, to Principal, payable at the stated maturity of
     the Underlying Securities, of Underlying Securities which are not
     redeemable (otherwise than in connection with a default or acceleration) at
     the option of the Issuer thereof prior to stated maturity, and to a
     specified portion (less than 100%) of Interest due on the Underlying
     Securities on each Interest Payment Date on or prior to the First Call
     Date.

     (vi)   Callable Stripped Underlying Security Certificates, which entitle
     the Holders thereof, in the aggregate, to the Callable Principal relating
     to the Underlying Securities, and to a specified portion (less than 100%)
     of Interest due on the Underlying Securities on each Interest Payment Date
     on or prior to the First Call Date.

     (vii)  Pooled Certificates, which entitle the Holders thereof to all the
     interest payments on the Underlying Securities, all the principal payments
     on the Underlying Securities and any related premium payable upon early
     redemption of the Underlying Securities less any Retained Amount; provided,
     that any designation of classes of Certificates made in the Series Trust
     Agreement shall consist of only one of the following options, designated by
     letters (a) - (e): (a) Coupon Certificates and Principal Certificates, (b)
     Coupon Certificates and Callable Principal Certificates, (c) Stripped
     Coupon Certificates and Stripped Underlying Security Certificates, (d)
     Stripped Coupon Certificates and Callable Stripped Underlying Security
     Certificates, or (e) Pooled Certificates.

     The term "Certificate Register" shall have the meaning specified in Section
               --------------------
2.03 hereof.

     The term "Closing Date" shall mean the date set forth and designated as
               ------------
such in the Series Trust Agreement.

     The term "Commission" shall mean the Securities and Exchange Commission.
               ----------

     The term "Corporate Trust Office" shall mean the principal office of the
               ----------------------
Trustee as identified in the Series Trust Agreement.

     The term "Depositor" shall mean National Financial Securities Corporation,
               ---------
a Delaware corporation, and any successor as Depositor hereunder.

     The term "Designated Office in New York City," when used with respect to
               ----------------------------------
the Trustee, shall mean an office maintained in accordance with Section 5.06
hereof and designated by the Trustee.

                                      B-3
<PAGE>

     The term "DTC" shall mean The Depository Trust Company, a clearing agency
               ---
registered with the Commission, its successor or successors, and its nominee or
nominees.

     The term "Exchange Act" shall mean the Securities Exchange Act of 1934, as
               ------------
amended.

     The term "First Call Date" shall mean, for any Underlying Security, the
               ---------------
first date such Underlying Security can be redeemed at the option of the Issuer
thereof, which date shall be specified in the Series Trust Agreement.

     The term "Holder" shall mean a Person in whose name a Certificate is
               ------
registered in the Certificate Register.

     The term "Independent Certificate" shall mean a certificate of a non-
               -----------------------
affiliated accountant, engineer, appraiser or other expert, as required by the
TIA.

     The term "Indenture Trustee" shall mean the trustee or other fiduciary for
               -----------------
the Underlying Securities.

     The term "Interest" shall mean the right to receive the interest payable on
               --------
the Underlying Securities on each Interest Payment Date, subject to Section
5.03(b) hereof.

     The term "Interest Payment Dates" shall mean the dates on which interest
               ----------------------
payments are due on the Underlying Securities as specified in the Series Trust
Agreement.

     The term "Issuer" shall mean the issuer of the Underlying Securities
               ------
described in Exhibit A to the Series Trust Agreement.

     The term "Issuer Payment Default" shall have the meaning specified in
               ----------------------
Section 5.03 hereof.

     The term "Letter of Representations" shall mean the letter of
               -------------------------
representations from the Depositor and the Trustee to DTC with respect to the
Certificates held at DTC.

     The term "Officer's Certificate of the Depositor" shall mean a certificate
               --------------------------------------
signed by any Authorized Officer of the Depositor and delivered to the Trustee.
Unless otherwise specified, any reference in this Agreement to an Officer's
Certificate of the Depositor shall be to an Officer's Certificate of any
Authorized Officer of the Depositor.

     The term "Officer's Certificate of the Trustee" shall mean the certificate
               ------------------------------------
of the Trustee in the form attached as Exhibit D to the Series Trust Agreement.

     The term "Opinion of Counsel" shall mean one or more written opinions of
               ------------------
counsel who may, except as otherwise expressly provided in this Agreement, be
employees of or counsel to the Depositor and who shall be satisfactory to the
Trustee, and which opinion or opinions shall be

                                      B-4
<PAGE>

addressed to the Trustee as Trustee, shall comply with any applicable
requirements of this Agreement, and shall be in form and substance satisfactory
to the Trustee.

     The term "Outstanding Certificates" shall mean, as of the date of
               ------------------------
determination, all Certificates theretofore authenticated and delivered under
this Agreement except:

     (i)    Certificates theretofore canceled by the Certificate registrar or
     delivered to the Certificate registrar for cancellation;

     (ii)   Certificates or portions thereof for which money in the necessary
     amount for payment thereof has been theretofore deposited with the Trustee
     or any Paying Agent in trust for the Holders of such Certificates
     (provided, however, that if such Certificates are to be redeemed, notice of
     such redemption has been duly given pursuant to this Agreement or provision
     therefor, satisfactory to the Trustee, has been made); and

     (iii)  Certificates in exchange for which or in lieu of which other
     Certificates have been authenticated and delivered pursuant to this
     Agreement, unless proof satisfactory to the Trustee is presented that any
     such Certificates are held by a bona fide purchaser;

provided that in determining whether the Holders have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Certificates
owned by the Depositor, the Trustee or any Affiliate of any of the foregoing
Persons shall be disregarded and for purposes of determining the requisite
amount of Outstanding Certificates shall be deemed not to be Outstanding
Certificates, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Certificates that the Trustee knows to be so owned shall
be so disregarded.

     The term "Participant" means an entity maintaining a custodial account in
               -----------
its own name with DTC.

     The term "Paying Agent" shall mean the Trustee or any other Person that
               ------------
meets the eligibility standards for the Trustee specified in Section 5.01 and is
authorized to make payments of Principal or Interest on behalf of the Trustee.

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

     The term "Petition Date" shall mean (i) the date on which a bankruptcy
               -------------
petition is filed by or against the Issuer of the Underlying Securities or (ii)
the date of commencement of any other similar proceeding, as applicable.

     The term "Principal" shall mean the right to receive the principal due on
               ---------
the Underlying Securities, subject to Section 5.03(b) hereof.

                                      B-5
<PAGE>

     The term "Proceeding" shall mean any suit in equity, action at law or other
               ----------
judicial or administrative proceeding.

     The term "Rating Agency" shall mean each rating agency which is identified
               -------------
in Exhibit A to the Series Trust Agreement.

     The term "Redemption Date" shall mean, with respect to any Underlying
               ---------------
Securities to be redeemed, the date fixed by the Issuer thereof for such
redemption.

     The term "Responsible Officer" shall mean, with respect to the Trustee, any
               -------------------
officer within the Corporate Trust Office of the Trustee, including any Senior
Vice President, Vice President, Assistant Vice President, Secretary, Assistant
Secretary, or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above-designated officers and also,
with respect to a particular matter, any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.

     The term "Retained Amount" shall mean the amount, if any, described in
               ---------------
Exhibit A to the Series Trust Agreement, which amount shall be held by the
Trustee in trust for the benefit of the Depositor and shall be paid by the
Trustee to the Depositor in accordance with Section 4.01 hereof.

     The term "Series" shall mean any series of Certificates identified in a
               ------
Series Trust Agreement.

     The term "Series Trust Agreement" shall mean the particular series trust
               ----------------------
deposit agreement between the Depositor and the Trustee into which these
Standard Terms have been incorporated. The term "Standard Terms" shall mean this
Standard Terms and Provisions of Series Trust Agreement between National
Financial Securities Corporation, as Depositor, and the Trustee.

     The term "TIA" shall mean the Trust Indenture Act of 1939, as amended.
               ---

     The term "Trust" shall mean the trust established by this Agreement for the
               -----
benefit of the Holders of the Certificates under the laws of the State of New
York.

     The term "Trustee" shall mean the institution acting as trustee with whom
               -------
the Depositor has entered into the Series Trust Agreement.

     The term "Underlying Security" shall mean, with respect to the issuance of
               -------------------
Certificates hereunder, the Underlying Securities specified in the Series Trust
Agreement relating to such Certificates in the aggregate principal amount so
specified.

     The term "Voting Rights" shall mean voting rights on the Certificates
               -------------
apportioned as required by Section 2.09 hereof.

                                      B-6
<PAGE>

     ARTICLE II CREATION OF TRUST; DELIVERY AND CUSTODY OF BONDS; FORM OF
 CERTIFICATES; EXECUTION AND DELIVERY, SURRENDER AND REDEMPTION OF CERTIFICATES

Section 2.1  Creation of Trust; Delivery and Custody of Underlying Securities;
             -----------------------------------------------------------------
Execution.
---------

     The Trust shall be established by the Depositor by execution and delivery
of the Series Trust Agreement and the deposit of the Underlying Securities
pursuant thereto. The sole asset of the Trust shall be the Underlying Securities
deposited by the Depositor and any other related property specified in the
Series Trust Agreement. The Certificates shall evidence fractional interests in
designated portions of the assets of the Trust. The income received by, and the
assets of, the Trust shall be distributed solely in accordance with this
Agreement. The Depositor shall, by book-entry credit or otherwise, irrevocably
deliver the Underlying Securities to the Trustee and, concurrently therewith,
the Trustee shall, in accordance with the provisions of this Agreement, execute
and deliver to the Depositor, or such Person or Persons as the Depositor may
designate by written instruction, the classes of Certificates identified in the
Series Trust Agreement, evidencing the aggregate amount, in Authorized
Denominations, of the Underlying Securities so delivered to the Trustee. The
Depositor shall also, in connection with the Series Trust Agreement, enter into
a separate agreement with the Trustee, satisfactory to the Trustee, providing
for the payment of the charges and expenses of the Trustee in respect of such
Certificates.

     The Trustee shall accept the Underlying Securities so delivered as trustee
for the Holders of the Certificates, which shall be delivered hereunder to
evidence the interests of the Holders in the Underlying Securities, and shall
hold the Underlying Securities as provided hereunder. The Underlying Securities
shall be deposited by Book-Entry Credit in an account maintained on behalf of
the Trustee at DTC, unless the Series Trust Agreement specifies that the Trustee
shall hold the Underlying Securities (i) in a special trust account created by
separate recordation on its books, separate from all other assets of the
Trustee, or (ii) in some other manner. Separate subaccounts of any such special
trust account shall be established for each series of Certificates.

     The Trustee shall hold all the Underlying Securities delivered to it
pursuant to this Agreement in trust for the Holders, identified and held
separate and apart from the general assets of the Trustee. The account of the
Trustee in which the Underlying Securities are held shall not contain any
property of the Trustee in its individual capacity and shall contain only
property held by the Trustee as fiduciary. The Trustee agrees that it does not
have the authority to assign, transfer, encumber, pledge, sell, set-off or
otherwise dispose of any of the Underlying Securities or any interests therein
except as provided hereunder or as required by law.

     The Trustee acknowledges that it is not the beneficial owner of the
Underlying Securities and that it holds the Underlying Securities solely as
trustee for the Holders pursuant to this Agreement. Interest and principal
payments on the Underlying Securities held in the trust account will not be
subject to any right, charge, security interest, lien or claim of any kind in
favor of the Trustee, the Depositor or any Person claiming through either of
them.

                                      B-7
<PAGE>

     The representations and covenants contained in the Officer's Certificate of
the Trustee delivered in connection with the issuance of the Certificates shall
be deemed to be incorporated by reference herein, as fully as if set forth in
full herein.

     A reasonable time prior to the delivery of Underlying Securities to the
Trustee, the Depositor shall furnish the Trustee with written instructions as to
the name in which the Certificates evidencing interests in such Underlying
Securities shall initially be registered, the denominations in which such
Certificates shall initially be delivered, the Persons and addresses to whom
such Certificates are to be delivered and such other information as may be
requested by the Trustee in connection with the execution and delivery of such
Certificates. Each class of Certificates shall evidence the ownership by the
Holders thereof of Interest, Principal, or Callable Principal (or portions
thereof), as the case may be, on the Underlying Securities, less any Retained
Amount, to the extent required by the terms of such class of Certificates.

     Underlying Securities underlying Certificates which are not held by book-
entry credit at an account maintained on behalf of the Trustee at DTC shall be
held by the Trustee at its Designated Office in New York City or at such other
place or places as the Trustee shall determine.

Section 2.2  Form of Certificates.
             --------------------

     Certificates shall be issued in registered form only and shall be
typewritten or printed on safety paper. The classes of Certificates to be issued
hereunder shall be identified in the Series Trust Agreement and shall be
substantially in the forms set forth in Exhibit C thereto, in each case with
appropriate insertions, modifications and omissions, as therein and herein so
provided. Certificates shall be executed by the Trustee by the manual signature
of a duly authorized signatory of the Trustee. No Certificate shall be entitled
to any benefits under this Agreement or be valid or obligatory for any purpose,
unless it shall have been executed manually by the Trustee by the signature of a
duly authorized signatory. The Trustee shall record in the Certificate Register
each Certificate so signed and delivered as herein provided.

     The Authorized Denominations for each class of Certificates shall be the
dollar amount, and greater multiples thereof (or of such other dollar amount
specified in the Series Trust Agreement), set forth in the Series Trust
Agreement.

     Certificates may be endorsed with or have incorporated in the text thereof
such legends or recitals not inconsistent with the provisions of this Agreement
as may be required by the Trustee or required to comply with any applicable law
or any regulation thereunder.

Section 2.3  Registration and Registration of Transfer and Exchange of
             ---------------------------------------------------------
Certificates.
------------

     The Trustee shall keep at its Designated Office in New York City a register
(the register maintained in such office being herein sometimes referred to as
the "Certificate Register") in which, subject to such reasonable regulations as
it may prescribe, the Trustee shall provide for the registration of Certificates
and for the registration of transfers or exchanges of Certificates.

                                      B-8
<PAGE>

     Upon surrender for registration of transfer of any Certificate at the
Trustee's Designated Office in New York City, the Trustee shall execute and
deliver, in the name of the designated transferee or transferees, one or more
Certificates of the same class and series, of any Authorized Denominations and
of a like aggregate amount.

     At the option of the Holder, Certificates may be exchanged for other
Certificates of the same class and series, of any Authorized Denominations and
of a like aggregate amount, upon surrender of the Certificates to be exchanged
at the Trustee's Designated Office in New York City. Whenever any Certificates
are so surrendered for exchange, the Trustee shall execute and deliver the
Certificates which the Holder making the exchange is entitled to receive.

     All Certificates issued upon any registration of transfer or exchange of
Certificates shall evidence, to the extent indicated thereby, Interest,
Principal and/or Callable Principal (or portions thereof), as the case may be,
of Underlying Securities held by the Trustee hereunder and shall be entitled to
the same benefits under this Agreement as the Certificates surrendered upon such
registration of transfer or exchange.

     Every Certificate presented for registration of transfer or for exchange
shall (if so required by the Trustee) be duly endorsed by, or be accompanied by
a written instrument of transfer in form satisfactory to the Trustee and duly
executed by, the Holder thereof or such Holder's attorney duly authorized in
writing.

Section 2.4  Limitations on Execution and Delivery, Surrender and Registration
             -----------------------------------------------------------------
of Transfer and Exchange of Certificates.
----------------------------------------

     As a condition precedent to the execution and delivery, surrender or
registration of transfer or exchange of any Certificate, the Trustee may require
payment, by the Holder requesting such action, of the then applicable service
charge of the Trustee and of a sum sufficient for reimbursement of any tax or
other governmental charge with respect thereto, may require the production of
proof reasonably satisfactory to it as to the Holder's residence and identity
and genuineness of any signature, may require the Holder to execute certificates
and to make such representations and assurances as the Trustee may reasonably
deem necessary or proper, and may also require compliance with such regulations,
if any, as the Trustee may reasonably establish consistent with the provisions
of this Agreement.

     The surrender or registration of transfer or exchange of Certificates may
be suspended if any such suspension is deemed necessary or advisable by the
Trustee at any time or from time to time because of any requirement of law or of
any government or governmental body or commission, or under any provision of
this Agreement, or for any other reason which makes such surrender or
registration of transfer or exchange impracticable.

Section 2.5  Mutilated, Destroyed, Lost or Stolen Certificates.
             -------------------------------------------------

     In case any Certificate shall be mutilated, the Trustee in its discretion
may execute and deliver a Certificate of the same series, of like form and
tenor, and in the same denomination and

                                      B-9
<PAGE>

bearing a number not contemporaneously outstanding, in exchange and substitution
for such mutilated Certificate. In case any Certificate shall be destroyed, lost
or stolen, the Trustee may execute and deliver a Certificate of the same series,
of like form and tenor, and in the same denomination and bearing a number not
contemporaneously outstanding, in lieu of and in substitution for such
destroyed, lost or stolen Certificate, only upon (i) the filing by the Holder
thereof with the Trustee of evidence satisfactory to the Trustee of the
destruction, loss or theft of such Certificate and of the authenticity of such
Holder's ownership thereof, and (ii) the furnishing to the Trustee of reasonable
indemnification satisfactory to it. All expenses and charges associated with
such indemnity and with the preparation, execution and delivery of a new
Certificate shall be borne by the Holder of the Certificate mutilated,
destroyed, lost or stolen.

Section 2.6  Persons Deemed Owners.
             ---------------------

     Prior to due presentment of a Certificate for registration of transfer, the
Trustee and any agent of the Trustee may treat the Person in whose name such
Certificate is registered as the owner of such Certificate for the purpose of
receiving payment of such Certificate and for all other purposes whatsoever,
whether or not such Certificate be overdue, and neither the Trustee nor any
agent of the Trustee shall be affected by notice to the contrary.

Section 2.7  Cancellation and Destruction of Surrendered Certificates.
             --------------------------------------------------------

     All Certificates surrendered to the Trustee shall be canceled by the
Trustee. The Trustee is authorized to destroy such Certificates so canceled.

Section 2.8  Book-Entry.
             ----------

     (i)    At the election of the Depositor, the Series Trust Agreement may
     provide that (1) all Certificates of a series are to be held in DTC's book-
     entry only system, (2) all Certificates of a series are to be issued in
     definitive physical form, or (3) the Certificates (or any part thereof) are
     to be issued or held in such other form as is specified in the Series Trust
     Agreement.

     (ii)   Notwithstanding Section 4.01 hereof, when the registered Holder of
     any or all of the Certificates is DTC, such Certificates shall be
     registered in the name of Cede & Co., as nominee for DTC, and payment in
     respect of any Interest, Principal or Callable Principal represented by any
     Certificate shall be made on or after the corresponding Interest Payment
     Dates, in the case of the payment of Interest, and on or after the
     corresponding stated maturity date, in the case of the payment of
     Principal, in each case after the Trustee shall have received the amounts
     due from the Issuer of the Underlying Securities, by credit of same day
     funds to the account indicated for Cede & Co. in the Certificate Register.
     Payments received by the Trustee on or prior to 2:00 p.m., New York City
     time, shall be credited to DTC that same day and payments received after
     such time shall be credited the following Business Day. Notwithstanding any
     other provisions in this Agreement, the right of the Holder of any
     Certificate to receive any of the payments described above in this Section
     2.08

                                     B-10
<PAGE>

     (ii), and to institute suit for the enforcement of any such payment on or
     after the date such payment is payable, shall not be impaired without the
     consent of such Holder.

     (iii)  Certificates of which Cede & Co. shall be the Holder shall be
     initially issued in the form of one or more separate single Certificates
     for each separate class of Certificates identified in the Series Trust
     Agreement to be issued hereunder, aggregating in each case to the amount of
     each separate stated maturity of the Certificates, or in such other manner
     as is required by DTC. Upon initial issuance, the ownership of each such
     Certificate shall be registered in the Certificate Register in the name of
     Cede & Co., as nominee for DTC. The Depositor and the Trustee may treat DTC
     (or its nominee) as the sole and exclusive owner of each Certificate
     registered in its name for the purposes of payment of Interest, Principal
     and/or Callable Principal represented thereby, giving any notice permitted
     or required to be given to Holders under this Agreement, registering the
     transfer of such Certificate, obtaining any consent or other action to be
     taken by Holders and for all other purposes whatsoever, and neither the
     Depositor nor the Trustee shall be affected by any notice to the contrary.
     Neither the Depositor nor the Trustee shall have any responsibility or
     obligation to any Participant, any Person claiming a beneficial ownership
     interest in such Certificate under or through DTC or any Participant or any
     other Person that is not shown on the Certificate Register as being a
     Holder of such Certificate, with respect to the accuracy of any records
     maintained by DTC or any Participant; the payment by DTC or any Participant
     of any amount in respect of Principal, Interest and/or Callable Principal
     represented by such Certificate; any notice (or the timeliness thereof)
     that is permitted or required to be given to Holders of such Certificate
     under this Agreement; or any consent given or other action taken by DTC as
     the Holder of such Certificate. Upon delivery by DTC to the Trustee of
     written notice to the effect that DTC has determined to substitute a new
     nominee in place of Cede & Co., and subject to the provisions of section
     2.03 hereof limiting the obligations of the Trustee to register transfers
     of or to exchange Certificates, the words "Cede & Co." in this Agreement
     shall refer to such new nominee of DTC.

     (iv)   DTC may determine to discontinue providing its services with respect
     to Certificates at any time by giving 90 days prior written notice to the
     Depositor and the Trustee and discharging its responsibilities with respect
     thereto under applicable law. Following receipt of such notice from DTC,
     the Trustee shall promptly notify the Rating Agency. In connection
     therewith, the Trustee and the Depositor will cooperate with DTC in taking
     appropriate action after reasonable notice (a) to make available one or
     more separate physical certificates evidencing the Certificates to any
     Participant having Certificates credited to its DTC account or (b) to
     arrange for another securities depository to maintain custody of physical
     certificates evidencing such Certificates. Upon (1) the resignation of DTC
     from its functions as depository in accordance herewith, provided that the
     Depositor is unable to arrange for another securities depository to act as
     successor to DTC, (2) the election by the Depositor to terminate book-entry
     registration of the Certificates (which election shall only be made if the
     Depositor determines that such election will not adversely affect the
     Holders), (3) the delivery of written notice to the Trustee through DTC,
     from Holders of Outstanding Certificates representing at least a majority
     of the Voting Rights, that such Holders elect to terminate book-entry
     registration of the Certificates, (4) a default in payment of any Interest,

                                     B-11
<PAGE>

     Principal or Callable Principal due on the Underlying Securities, which
     default remains uncured for 10 days, and the election by the Trustee to
     terminate book-entry registration of the Certificates, or (5) the
     occurrence of an Available Information Event (provided that the financial
     statements and other information about the Issuer of the Underlying
     Securities referred to in Section 5.15 hereof are not thereafter available
     to the Trust), the Depositor shall notify DTC and, except in the case of
     item (4) above, the Trustee of such event, whereupon DTC is required under
     the Letter of Representations to notify the Participants of the
     availability through DTC of physical certificates evidencing the
     Certificates. In such event, DTC is required under the Letter of
     Representations to promptly deliver to the Trustee the physical
     certificates evidencing such Certificates, whereupon the Trustee at the
     expense of the Depositor shall deliver physical certificates evidencing the
     Certificates to any Participant having Certificates credited to its account
     at DTC and the provisions of this Agreement shall then apply irrespective
     of this Section 2.08.

     (v)    In connection with any notice or other communication to be provided
     to Holders pursuant to this Agreement by the Trustee with respect to any
     consent or other action to be taken by Holders, the Trustee shall establish
     a record date for such consent or other action and give DTC notice of such
     record date not less than 15 calendar days in advance of such record date
     to the extent possible. Such record date shall be the later of thirty (30)
     days prior to the first solicitation of such consent or other action or the
     date of the most recent list of Holders furnished to the Trustee pursuant
     to Section 6.01 hereof.

     (vi)   In the event that Underlying Securities are redeemed and
     Certificates are correspondingly redeemed and the Certificates are
     registered in the name of Cede & Co., as nominee for DTC, the Certificates
     shall be redeemed and terminated without action by the Holder thereof, all
     as provided in the Letter of Representations.

Section 2.9  Action or Consent of Holders.
             ----------------------------

     The Voting Rights on the Certificates shall be apportioned by the Trustee
among the Holders, as of the applicable record date as determined by the Trustee
pursuant to Section 2.08(v) hereof, of the Outstanding Certificates in
proportion to the Accreted Value or, with respect to Stripped Underlying
Security Certificates, Callable Stripped Underlying Security Certificates and
Pooled Certificates, the principal amount, of each class of Certificates, and
within each class, pro rata by aggregate Accreted Value or principal amount, as
applicable. In the event of any action or consent requiring the vote of the
owners of any Underlying Securities at any time when the Certificates are held
in the DTC book-entry form, the Trustee, upon receipt of the Underlying Security
proxy, shall notify DTC (in its capacity as the Holder of the Certificates) of
such action. Under current procedures the Depositor expects that DTC will notify
the Participants who will notify the Beneficial Owners of the Certificates of
such an event. Thereafter, the Trustee shall vote solely in accordance with such
proxies and shall apportion its voting powers on the basis of the votes cast by
the Holders, based upon the direction the Holders have received from the
Beneficial Owners. If the Certificates are not then held by DTC or any other
depository, the Trustee, upon receipt of the Underlying Security proxy, shall
notify the Holders directly of such action and shall vote in the same manner as
noted above. The Trustee shall cast its vote in connection with the foregoing
vote on the Underlying

                                     B-12
<PAGE>

Securities in proportion to the Voting Rights on the Certificates held by the
Holders or groups of Holders directing it, notwithstanding that such Holder or
groups of Holders may give contrary instructions or that such instructions may
conflict.

     The Trustee shall at no time vote for or consent to any action (i) to the
extent that such vote or consent could reasonably be expected to alter the
status of the Trust as a grantor trust for federal income tax purposes, (ii)
prior to the filing of a bankruptcy petition by or against the Issuer of the
Underlying Securities or the commencement of any other similar proceeding, if
such action would alter the timing or amount of any payment on such Underlying
Securities or (iii) prior to the filing of a bankruptcy petition by or against
the Issuer of Underlying Securities, or the commencement of any other similar
proceeding, if such action would result in the exchange or substitution of any
of such outstanding Underlying Securities pursuant to a plan for the refunding
or refinancing of such Underlying Securities. In connection with any vote, the
Trustee may request, as a condition precedent to casting any vote, that it be
provided with an opinion of Counsel that the consent or action will not alter
the status of the Trust as a grantor trust for federal income tax purposes,
which Opinion of Counsel shall be an expense of the Holders voting in favor of
the proposed action. The Trustee in requesting such opinion shall inform the
Holders of the potential expense of the Opinion of Counsel.

     In no event shall the Depositor be allowed or entitled (other than in its
capacity as a Participant for a Beneficial Owner) to vote, directly or
indirectly, any Certificates.

     The Trustee shall also transmit to DTC or, if the Certificates are not then
held by DTC or any other depository, the Holders as provided in Section 9.04
hereof, any communications from the Issuer or from a third party (other than the
Issuer) to the Trustee as bondholder, upon receipt from such Issuer or third
party, respectively, of assurances that the Trustee's reasonable expenses will
be reimbursed by such Issuer or third party. If the Trustee does not receive
such assurances, then the Trustee, at the sole discretion of the Depositor and
at the expense of the Trust, shall transmit or cause to be transmitted any such
communications to DTC or, if the Certificates are not then held by DTC or any
other depository, the Holders as provided in Section 9.04 hereof.

Section 2.10 Transfer of Certificates Held by DTC to Successor Depository.
             ------------------------------------------------------------

(a)  If the Depositor elects to direct that the Trustee deliver Certificates
with respect to a particular Series Trust Agreement in the name of and to DTC,
as the depository hereunder, or its nominee, said Certificates may not
thereafter be transferred except:

   (i)   to any successor of DTC or its nominee;

   (ii)  to any substitute depository not objected to by the Trustee, upon (1)
   the resignation of DTC or its successor (or any substitute depository or its
   successor) from its functions as depository or (2) a determination by the
   Depositor that it is in the best interest of the Depositor (and will not
   adversely affect the Holders) or the Holders to remove DTC or its successor
   (or any substitute depository or its successor); or

                                     B-13
<PAGE>

   (iii) as provided in Section 2.08(iv) hereof;

   provided, that any successor of DTC or substitute depository referred to
   above shall be a clearing agency registered with the Commission and shall
   otherwise be qualified under any applicable laws to provide the services
   proposed to be provided by it.

Section 2.11 Temporary Certificates.
             ----------------------

     The Certificates may be initially delivered in temporary form exchangeable
for definitive Certificates when ready for delivery, which temporary
Certificates shall be printed, lithographed or typewritten, shall be of such
denominations as may be determined by the Trustee, shall be in fully registered
form and shall contain such reference to any of the provisions hereof as may be
appropriate. Every temporary Certificate shall be executed and delivered by the
Trustee upon the same conditions and terms and in substantially the same manner
as definitive certificates. If temporary Certificates are issued, the Trustee
shall execute and deliver definitive Certificates without delay, and in that
case upon demand of the Holder of any temporary Certificates such temporary
Certificates shall be exchanged without cost to such Holder for definitive
Certificates at the office of the Trustee upon surrender of such temporary
Certificates, and until so exchanged such temporary Certificates shall be
entitled to the same benefit, protection and security hereunder as the
definitive Certificates executed and delivered hereunder. All temporary
Certificates surrendered pursuant to the provisions of this Section 2.11 shall
be canceled by the Trustee, shall not be redelivered and shall be disposed of
pursuant to Section 2.07.

    ARTICLE III CERTAIN OBLIGATIONS OF HOLDERS OF CERTIFICATES; DEPOSITOR'S
                                  WARRANTIES

Section 3.1  Filing Proofs, Certificates and Other Information.
             -------------------------------------------------

     Any Holder presenting Certificates for surrender or registration of
transfer or exchange may be required to file such proof of residence, or other
matters or information, to execute such certificates and to make such
representations and warranties as the Trustee may reasonably deem necessary or
proper. The Trustee may withhold the delivery or delay the surrender of or
registration of transfer or exchange of any Certificate until such proof or
other information is filed, such certificates are executed or such
representations and warranties are made.

Section 3.2  Payment of Taxes or Other Governmental Charges.
             -----------------------------------------------

     If any tax or other governmental charge shall become payable by or on
behalf of the Trustee, including any tax or charge required to be withheld from
any payment made to or by the Trustee under the provisions of any applicable
law, with respect to any Certificate or with respect to the Interest, Principal
or Callable Principal (or portions thereof) evidenced by any Certificate, such
tax or governmental charge shall be payable by the Holder of such Certificate
and may be so withheld by the Trustee. The surrender of or registration of
transfer or exchange of any Certificate may be refused until such payment is
made.

                                     B-14
<PAGE>

Section 3.3  Depositor's Warranties.
             ----------------------

     In the case of each delivery of Underlying Securities to the Trustee, the
Depositor shall be deemed thereby to represent and warrant to the Trustee that
the Depositor is duly authorized to so deliver such Underlying Securities and
that immediately prior to the delivery thereof the Depositor owned such
Underlying Securities free and clear of any lien, pledge, encumbrance or other
security interest, and such delivery is irrevocable and free of any continuing
claim by the Depositor, except for the Retained Amount. The Depositor shall
further be deemed by such delivery to represent and warrant to the Trustee that
the prospectus and prospectus supplement prepared by the Depositor with respect
to the Certificates makes such disclosure with respect to the Underlying
Securities as is required by applicable federal and state securities laws. Such
representations and warranties shall survive the delivery of such Underlying
Securities and the Certificates in respect thereof.

 ARTICLE IV PAYMENT OF INTEREST AND PRINCIPAL; CUSTODY OF PROCEEDS OF INTEREST
                            AND PRINCIPAL PAYMENTS

Section 4.1  Payment of Interest; Payment of Principal; Mandatory Exchange of
             ----------------------------------------------------------------
Callable Principal Certificates and Callable Stripped Underlying Security
-------------------------------------------------------------------------
Certificates.
------------

     In the case of Underlying Securities held by the Trustee in certificate
form, the Trustee shall present the Underlying Securities to the Issuer,
Indenture Trustee or paying agent therefor, as applicable, for payment of
Interest on the Interest Payment Dates related thereto and all Principal at
stated maturity or upon the Redemption Date therefor, to the extent required
under the terms of such Underlying Securities to obtain payment thereon.

     With respect to any Coupon Certificate, on or after the Interest Payment
Date of the Interest evidenced thereby, if the Issuer shall have paid in full
and the Trustee shall have received the interest due on such Interest Payment
Date on the Underlying Securities, the Trustee shall pay to the Holder thereof
upon presentation and surrender of its Certificates, in lawful money of the
United States of America, by check no later than one Business Day after receipt
of funds by the Trustee, the entire amount of such Interest evidenced thereby,
less any taxes or governmental charges required to be withheld from such payment
by the Trustee.

     With respect to any Principal Certificate, on or after the stated maturity
date of the Principal evidenced thereby, if the Issuer shall have paid in full
and the Trustee shall have received the amount of such Principal upon maturity
of the underlying Underlying Security or Underlying Securities, the Trustee
shall pay to the Holder thereof upon presentation and surrender of its
Certificates, in lawful money of the United States of America, by check no later
than one Business Day after receipt of funds by the Trustee, the entire amount
of such Principal evidenced thereby, less any taxes or governmental charges
required to be withheld from such payment by the Trustee.

     With respect to any Callable Principal Certificate, on or after the stated
maturity date, the redemption date or the Interest Payment Date, as applicable,
of the Callable Principal evidenced thereby, if the Issuer shall have paid and
the Trustee shall have received all or any part of the Callable Principal due
upon maturity or earlier redemption of the underlying Underlying Securities

                                     B-15
<PAGE>

or on any Interest Payment Date, the Trustee shall pay to the Holder thereof
upon presentation and surrender of its Certificates, in lawful money of the
United States of America, by check no later than one Business Day after receipt
of funds by the Trustee, the entire amount of such Callable Principal so paid
and received or, in the case of a Callable Principal Certificate redeemed in
part, the amount of such Principal so redeemed; in each case less any taxes or
governmental charges required to be withheld from such payment by the Trustee.

     Any Callable Principal Certificate which is not redeemed on the First Call
Date shall be terminated and deemed involuntarily surrendered by the Holder
thereof in exchange for a principal amount of the Underlying Securities
underlying such Callable Principal Certificate equal to the face amount of such
Callable Principal Certificate, whether or not such Holder has requested such
exchange. No action such Holder shall be required to effect such termination,
which shall be carried out by the Trustee pursuant to the terms of this
Agreement.

     With respect to any Stripped Coupon Certificate, on or after the Interest
Payment Date of the Interest evidenced thereby, if the Issuer shall have paid in
full and the Trustee shall have received the interest due on such Interest
Payment Date on the underlying Underlying Securities, the Trustee shall pay to
the Holder thereof upon presentation and surrender of its Certificates, in
lawful money of the United States of America, by check no later than one
Business Day after receipt of funds by the Trustee, the entire amount of such
Interest evidenced thereby, less any taxes or governmental charges required to
be withheld from such payment by the Trustee.

     With respect to any Stripped Underlying Security Certificate, on or after
the Interest Payment Date or stated maturity date, as applicable, of the
Interest or Principal evidenced thereby, if the Issuer shall have paid and the
Trustee shall have received the Interest evidenced thereby or all or any part of
the principal amount of the Principal evidenced thereby due upon maturity of the
underlying Underlying Securities, the Trustee shall pay to the Holder thereof
(i) with respect to each Interest Payment Date preceding the maturity date, as
of the applicable record date of the underlying Underlying Securities, and (ii)
with respect to the maturity date, upon presentation of its Certificates, in
lawful money of the United States of America, by check no later than one
Business Day after receipt of funds by the Trustee (in the case of clause (i)
above, sent by first-class mail to the address of the Holder set forth in the
Certificate Register), the entire amount of such Interest and/or Principal; in
each case less any taxes or governmental charges required to be withheld from
such payment by the Trustee.

     With respect to any Callable Stripped Underlying Security Certificate, on
or after the stated maturity date, the redemption date or the Interest Payment
Date, as applicable, of the Callable Principal evidenced thereby, if the Issuer
shall have paid and the Trustee shall have received the Interest or all or any
part of the Callable Principal evidenced thereby due upon maturity or earlier
redemption of the underlying Underlying Securities or on any Interest Payment
Date, the Trustee shall pay to the Holder thereof (i) with respect to each
Interest Payment Date preceding the maturity date or redemption date, as
applicable, as of the applicable record date of the underlying Underlying
Securities, and (ii) with respect to the maturity date or redemption date, as
applicable, upon presentation of its Certificates, in lawful money of the United
States of America, by check no later than one Business Day after receipt of
funds by the Trustee (in the case of clause (i) above, sent by

                                     B-16
<PAGE>

first-class mail to the address of the Holder set forth in the Certificate
Register), the entire amount of such Holder's allocable portion of the Callable
Principal so received or, in the case of a Callable Stripped Underlying Security
Certificate redeemed in part, the amount so redeemed; in each case less any
taxes or governmental charges required to be withheld from such payment by the
Trustee.

     Any Callable Stripped Underlying Security Certificate which is not redeemed
on the First Call Date shall be terminated and deemed involuntarily surrendered
by the Holder thereof in exchange for a principal amount of the Underlying
Securities underlying such Callable Stripped Underlying Security Certificate
equal to the face amount of such Callable Stripped Underlying Security
Certificate, whether or not such Holder has requested such exchange. No action
by such Holder shall be required to effect such termination, which shall be
carried out by the Trustee pursuant to the terms of this Agreement.

     With respect to any Pooled Certificate, on or after the stated maturity
date, the redemption date or the Interest Payment Date, as applicable, of the
Interest, Principal or Callable Principal evidenced thereby, if the Issuer shall
have paid and the Trustee shall have received Interest on any of the Underlying
Securities in the Trust evidenced thereby or all or any part of the Principal or
Callable Principal on any of the Underlying Securities in the Trust evidenced
thereby due upon maturity or earlier redemption of such Underlying Securities or
on any Interest Payment Date, the Trustee shall pay to the Holder thereof (i)
with respect to each Interest Payment Date preceding the maturity date or
redemption date, as applicable, as of the applicable record date of the
underlying Underlying Securities, and (ii) with respect to the maturity date or
redemption date, as applicable, upon presentation of its Certificates, in lawful
money of the United States of America, by check no later than one Business Day
after receipt of funds by the Trustee (in the case of clause (i) above, sent by
first-class mail to the address of the Holder set forth in the Certificate
Register), the entire amount of such Interest, Principal or Callable Principal
so paid and received, less any Retained Amount, or, in the case of a Certificate
redeemed in part, the amount of such Callable Principal so redeemed; in each
case less any taxes or governmental charges required to be withheld from such
payment by the Trustee.

     With respect to any payment of Interest, Principal or Callable Principal,
as applicable, that constitutes a Retained Amount, the Trustee shall remit such
Retained Amount to the Depositor, in immediately available funds, within one
Business Day of receipt by the Trustee from the Issuer.

     When making any payment to a Holder of a Certificate or, with respect to
any Retained Amount, to the Depositor, under this Agreement, the Trustee shall
round down such payment to the nearest whole cent.

     Notwithstanding any other provisions in this Agreement, the right of the
Holder of any Certificate to receive any of the payments described above in this
Section 4.01, and to institute suit for the enforcement of any such payment on
or after the date such payment is payable, shall not be impaired without the
consent of such Holder.

Section 4.2  Segregation of Moneys Received from Issuers in Respect of
             ---------------------------------------------------------
Underlying Securities.
---------------------

                                     B-17
<PAGE>

     All moneys received from the Issuers of Underlying Securities or otherwise
by the Trustee in respect of Underlying Securities evidenced by Certificates
issued hereunder shall be held by it without interest in a segregated trust
account (which account shall contain two subaccounts, one for interest payments
on the Underlying Securities and the second for principal and redemption premium
payments on the Underlying Securities) for each issue of Underlying Securities
held in trust until required to be disbursed in accordance with the provisions
of this Agreement or as otherwise required by law and such moneys shall be
segregated by separate recordation on the books and records of the Trustee.
Payments whose character as principal, redemption premium or interest on the
Underlying Securities cannot be determined shall be deposited in the subaccount
for principal until distributed pursuant to Section 5.03(b) hereof.

Section 4.3   Paying Agent.
              ------------

     Each Paying Agent other than the Trustee shall execute and deliver to the
Trustee an instrument in which such Paying Agent shall agree with the Trustee
(and if the Trustee acts as Paying Agent, it hereby so agrees), that such Paying
Agent shall:

     (i)  hold all sums held by it for the payment of amounts due with respect
     to the Underlying Securities in trust for the benefit of the Persons
     entitled thereto until such sums shall be paid to such Persons or otherwise
     disposed of as herein provided and pay such sums to such Persons as herein
     provided;

     (ii) give the Trustee notice of any default by the Issuer (or any other
     obligor upon the Underlying Securities) of which it has actual knowledge in
     the making of any payment required to be made with respect to the
     Certificates.

                   ARTICLE V  THE TRUSTEE AND THE DEPOSITOR

Section 5.1   Eligibility of Trustee; Disqualification.
              ----------------------------------------

     The Trustee shall at all times satisfy the requirements of TIA Section
310(a). The Trustee shall have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of condition
and it shall have a long term unsecured debt or deposit rating of A-2 or better
by Moody's Investors Service, Inc. and A by Standard & Poor's Ratings Group or
the equivalent rating thereof by the Rating Agency (if other than Moody's
Investors Service, Inc., or Standard & Poor's Ratings Group). The Trustee shall
comply with TIA Section 310(b); provided, however, that there shall be excluded
from the operation of TIA Section 310(b)(1) any series trust deposit agreements
under which other securities are outstanding evidencing ownership interests in
bonds of the Issuer of the Underlying Securities if the requirements for such
exclusion set forth in TIA Section 310(b)(1) are met.

Section 5.2   Trustee's Duties on Default; No Liability of the Trustee or the
              ---------------------------------------------------------------
Depositor on the Underlying Securities.
--------------------------------------

                                     B-18
<PAGE>

     If an event of default on the Underlying Securities has occurred and is
continuing, the Trustee shall exercise the rights and powers vested in it by
this Agreement and 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.

     The Trustee shall have the legal power to exercise all of the rights,
powers and privileges of a holder of the Underlying Securities in which the
Certificates evidence an interest. However, neither the Trustee (except as
specifically provided in Section 5.03 or elsewhere herein or in the TIA) nor the
Depositor shall be under any obligation whatsoever to appear in, prosecute or
defend any action, suit or other proceeding in respect of Underlying Securities
or Certificates.

     The sole obligor with respect to any Underlying Security is the Issuer
thereof or any other entity obligated to make payments to or on behalf of the
Issuer thereof (or its trustee or other applicable fiduciary) with respect to
such Underlying Security. Neither the Trustee nor the Depositor shall have any
obligation on or with respect to the Underlying Securities except as provided in
this Article V with respect to the Trustee; and their respective obligations
with respect to Certificates shall be solely as set forth in this Agreement.

     If there is an event of default (as defined in the indenture or other
document pursuant to which the Underlying Securities were issued) with respect
to any Underlying Security and such default is known to the Trustee, the Trustee
shall promptly give notice to DTC or, if the Certificates are not then held by
DTC or any other depository, directly to Holders thereof as provided in Section
9.04 hereof (and in the manner and to the extent provided in TIA Section 313(c))
within 90 days after such event of default occurs. Such notice shall set forth
(a) the identity of the issue of Underlying Securities, (b) the date and nature
of such default, (c) the face amount of the Interest, Principal or Callable
Principal to which such default relates, (d) the identifying numbers of the
class of Certificates, or any combination, as the case may be, evidencing the
Interest, Principal or Callable Principal (or portions thereof) described above
in clause (c), and (e) any other information which the Trustee may deem
appropriate. Except in the case of a default in payment of Principal or Interest
(including payments pursuant to a redemption of any Certificate), the Trustee
may withhold the notice to Holders if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interests of the Holders.

     Holders of Certificates shall have no recourse against the Depositor or the
Trustee for payment defaults on the Underlying Securities.

Section 5.3   Collection of Indebtedness and Suits for Enforcement by Trustee;
              ----------------------------------------------------------------
               Distribution of Amounts Received in Respect of Defaulted
               --------------------------------------------------------
               Underlying Securities.
               ---------------------

     (a)If: (i) default is made in the payment of any installment of interest on
     any Underlying Security when the same becomes due and payable, and such
     default continues unremedied for the period specified in the indenture (as
     identified in Exhibit A to the Series Trust Agreement), or, if no such
     period is specified, five days, after receipt by the Issuer of notice
     thereof from the Trustee or receipt by the Issuer and the Trustee of notice
     thereof from the Holders of Outstanding Certificates representing at least
     25% of the Voting Rights; or (ii)

                                     B-19
<PAGE>

     default is made in the payment of the principal of or any installment of
     the principal of any Underlying Security when the same becomes due and
     payable, and such default continues unremedied for the period specified in
     the indenture (as identified in Exhibit A to the Series Trust Agreement),
     or, if no such period is specified, thirty (30) days, after receipt by the
     Issuer of notice thereof from the Trustee or receipt by the Issuer and the
     Trustee of notice thereof from the Holders of Outstanding Certificates
     representing at least 25% of the Voting Rights;

     and the Issuer shall, upon demand of the Trustee, fail to pay forthwith to
     the Trustee, for the benefit of the Holders, the whole amount then due and
     payable on such Underlying Securities for principal and interest, with
     interest upon the overdue principal, at the rate borne by the Underlying
     Securities and in addition thereto such further amount as shall be
     sufficient to cover the costs and expenses of collection, including the
     reasonable compensation, expenses, disbursements and advances of the
     Trustee and its agents and counsel, to the extent permitted by law (such
     event, an "Issuer Payment Default"), then the Trustee, in its own name and
     as trustee of an express trust, subject to provision being made by the
     Holders for indemnification against costs, expenses and liabilities in a
     form satisfactory to the Trustee, shall institute a Proceeding for the
     collection of the sums so due and unpaid, and shall prosecute such
     Proceeding to judgment or final decree or settlement, and shall enforce the
     same against the Issuer or other obligor upon the Underlying Securities and
     collect in the manner provided by law out of the property of the Issuer or
     other obligor upon the Underlying Securities, wherever situated, the moneys
     adjudged or decreed to be payable, unless otherwise directed by Holders of
     Outstanding Certificates representing not less than a majority of the
     voting Rights. In connection therewith, the Trustee shall use its best
     reasonable efforts in accordance with such normal and customary procedures
     it shall deem necessary or advisable, and shall have the power and
     authority, acting alone, to do any and all things in connection therewith
     and the administration of the Trust as it may deem necessary or advisable.

     (b) In the event that the Trustee receives money or other property in
     respect of the Underlying Securities (other than a scheduled interest
     payment with respect to an Interest Payment Date, the scheduled payment of
     principal on or with respect to the stated maturity date of the Underlying
     Securities, or the payment of principal and any redemption premium on or
     with respect to the earlier redemption of the Underlying Securities) as a
     result of a payment default on the Underlying Securities, or actual notice
     that such moneys or other property will be paid to the Trustee, the Trustee
     shall promptly give notice (as provided in Section 9.04 hereof) to DTC or,
     if the Certificates are not then held by DTC or any other depository,
     directly to the Holders of the Certificates then outstanding and unpaid.
     Such notice shall state that, not later than thirty (30) days after the
     receipt of such moneys or other property, the Trustee shall allocate and
     distribute such moneys or other property to the Holders of the Outstanding
     Certificates then unpaid, in proportion to the Accreted Value or, with
     respect to Stripped Underlying Security Certificates, Callable Stripped
     Underlying Security Certificates and Pooled Certificates, the principal
     amount, of each class of Outstanding Certificates, and within each class,
     pro rata by aggregate Accreted Value or principal amount, as applicable.
     Property received, other than cash, shall be liquidated by the

                                     B-20
<PAGE>

     Trustee in a commercially reasonable manner and the proceeds thereof, after
     deduction of all reasonable costs of such liquidation, distributed in cash,
     only to the extent necessary to avoid distribution of fractional
     securities. The Trustee shall not be responsible for the failure of any
     Person to maximize the price at which such property may be sold. No Person
     effecting a sale on behalf of the Trustee shall be liable therefor so long
     as such sale is effected in a commercially reasonable manner.

Section 5.4   Control by Holders.
              ------------------

     The Holders of Outstanding Certificates representing a majority of the
Voting Rights shall, subject to provision being made for indemnification against
costs, expenses and liabilities in a form satisfactory to the Trustee, have the
right to direct the time, method and place of conducting any Proceeding for any
remedy available to the Trustee with respect to any Issuer Payment Default;
provided, however, that:

     (i)   such direction shall not be in conflict with any rule of law or with
     this Agreement;

     (ii)  subject to Sections 2.09 and 5.12, the Trustee need not take any
     action that it determines might cause it to incur any liability or might
     materially adversely affect the rights of any Holders not consenting to
     such action.

Section 5.5   Waiver of Past Defaults.
              ------------------------

     The Holders of Outstanding Certificates representing not less than a
majority of the Voting Rights may waive any past default and its consequences
except (i) an Issuer Payment Default or other default in the payment of
principal of or interest on any of the Certificates or (ii) a default in respect
of a covenant or provision hereof which cannot be modified or amended without
the consent of the Holder of each Certificate. In the case of any such waiver,
the Depositor, the Trustee and the Holders shall be restored to their former
positions and rights hereunder, respectively; but no such waiver shall extend to
any subsequent or other default or impair any right consequent thereto.

Section 5.6   Maintenance of Offices and Agencies by the Trustee.
              --------------------------------------------------

     Until termination of this Agreement in accordance with its terms, the
Trustee shall maintain (a) facilities in the City of New York for the execution
and delivery, payment, surrender and registration of transfer and exchange of
Certificates, all in accordance with the provisions of this Agreement, and (b)
such other agents, if any, as the Trustee and the Depositor may agree from time
to time.

Section 5.7   Prevention of or Delay in Performance by the Trustee or the
              -----------------------------------------------------------
Depositor.
---------

     Neither the Trustee nor the Depositor shall incur any liability to any
Holder of any Certificate, if by reason of any provision of any present or
future law, or regulation thereunder, of any governmental authority, or by any
reason of any act of God or war or other circumstance beyond the control of the
relevant party, the Trustee or the Depositor shall be prevented or forbidden
from doing or performing any act or thing which the terms of this Agreement
provide shall be done or

                                     B-21
<PAGE>

performed; and neither the Trustee nor the Depositor shall incur any liability
to any Holder of a Certificate by reason of any non-performance or delay, caused
as aforesaid, in the performance of any act or thing which the terms of this
Agreement provide shall or may be done or performed, or by reason of any
exercise of, or failure to exercise, any discretion provided for in this
Agreement.

Section 5.08. Liability of the Trustee and the Depositor.
              ------------------------------------------

(a) Neither the Trustee nor the Depositor assumes any obligation or shall be
subject to any liability under this Agreement to Holders of Certificates, other
than liability for its own negligent action, its own negligent failure to act or
its own willful misconduct, in the performance of such duties as are
specifically set forth in this Agreement or the TIA; further provided, that:

     (i)   the Trustee shall not be liable except for the performance of such
     duties as are specifically set out in this Agreement and no implied
     covenants or obligations shall be read into this Agreement against the
     Trustee;

     (ii)  the Trustee may conclusively rely, as to the truth of the statements
     and the correctness of the opinions expressed therein, in the absence of
     bad faith on the part of the Trustee, upon certificates or opinions
     conforming to the requirements of this Agreement (but the Trustee shall
     examine the evidence furnished to it pursuant to TIA Section 314 to
     determine whether or not such evidence conforms to the requirements of this
     Agreement);

     (iii) 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

     (iv)  to the extent that the Holders of Outstanding Certificates
     representing not less than a majority of the Voting Rights direct the
     Trustee with respect to the time, method and place of conducting any
     Proceeding for any remedy available to the Trustee with respect to an
     Issuer Payment Default, the Trustee shall not be liable with respect to any
     action it takes or omits to take in good faith in accordance with such
     direction.

     Neither DTC nor any registrar with which Underlying Securities are
maintained as book-entry credits shall be deemed agents of the Trustee. The
Trustee may own and deal (i) in bonds of the same issue and maturity as the
Underlying Securities and (ii) in Certificates.

     The Trustee shall be under no liability to any party hereto, or to any
Holder, by reason of any failure on the part of the Depositor or any maker,
guarantor, endorser or other signatory of any document or instrument, including
any Underlying Security, or any other Person to perform such Person's
obligations under any such document or instrument.

     The Trustee shall not be responsible for the sufficiency or accuracy, the
form or the execution, validity, value or genuineness of any document or
property received or held by it hereunder, including without limitation any
Underlying Securities, or the authority of the Depositor in executing this
Agreement.

<PAGE>

     The Trustee assumes no responsibility for the correctness of the recitals
to the Certificates or to any document issued in connection with the sale of the
Certificates, other than its signature under the Certificates.

ANY ACTION OR PROCEEDING ALLEGING ANY BREACH BY THE TRUSTEE OF ITS DUTIES UNDER
THIS AGREEMENT SHALL BE PROSECUTED ONLY IN A STATE OR FEDERAL COURT LOCATED IN
THE STATE OF NEW YORK, COUNTY OF NEW YORK. THE TRUSTEE SHALL HAVE THE RIGHT AT
ANY TIME TO SEEK INSTRUCTIONS FROM ANY COURT OF COMPETENT JURISDICTION.

     The Trustee shall be deemed to have exercised reasonable care in the
custody and preservation of the Underlying Securities in its possession if the
Underlying Securities are held in the manner specified in the Officer's
Certificate of the Trustee and are accorded treatment substantially equal to
that which a prudent Person accords its own property.

     The Trustee shall at all times maintain a fidelity bond in reasonable form
and amount to protect against loss due to dishonest or fraudulent action by its
employees in connection with its obligations hereunder.

     The Trustee may consult with and rely upon the calculations of an advisor
(which may be the Depositor) in connection with any calculation of Accreted
Value to the extent such amount must be determined in order for the Trustee to
carry out its duties hereunder.

     The Trustee may consult with counsel of its selection, and the advice of
such counsel or any Opinion of Counsel selected by the Trustee with due care
shall be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in reliance thereon.

     The Trustee may request and rely upon and shall be protected in acting or
refraining from action upon any resolution, certificate signed by an authorized
officer, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, facsimile transmission, request, consent,
order, appraisal, bond or other paper or document reasonably believed by it to
be genuine and to have been signed or presented by the proper party or parties.

     The Trustee shall be under no obligation to exercise any of the trusts or
powers vested in it by this Trust Agreement or to institute, conduct or defend
any litigation hereunder or in relation hereto, at the request, order or
direction of any of the Holders, pursuant to the provisions of this Series Trust
Agreement, unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities which may be
incurred therein or thereby.

     The Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys or a
custodian and shall not be liable for any misconduct or negligence of any such
agents or attorneys selected with due care by it.

     Any application by the Trustee for written instructions from the Depositor
may, at the option of the Trustee, set forth in writing any action proposed to
be taken or omitted by the Trustee under

                                     B-23
<PAGE>

this Series Trust Agreement and the date on and/or after which such action shall
be taken or such omission shall be effective, if, but only if, the obligations
of the Trustee with respect to such proposed action or omission, in the view of
the Trustee, are not set forth reasonably clearly in this Series Trust
Agreement. The Trustee shall not be liable for any action taken by, or omission
of, the Trustee in accordance with a proposal included in such application on or
after the date specified in such application (which date shall not be less than
ten (10) Business Days after the date a Responsible Officer of the Depositor
actually receives such application, unless any such Responsible Officer shall
have consented in writing to any earlier date) unless, prior to taking any such
action (or the effective date in the case of an omission), the Trustee shall
have received written instructions in response to such application specifying
the action to be taken or omitted; provided, however, that this provision shall
not protect the Trustee from liability for any action or omission constituting
willful misconduct, bad faith or negligence.

Section 5.9   Obligation of the Depositor.
              ---------------------------

     (a)     The Depositor shall:

     (i)     if so requested by the Trustee, provide to the Trustee at least
     10 Business Days prior to the date required for filing information
     reasonably necessary to assist the Trustee under Section 5.15(b) of this
     Agreement in preparing and filing reports with the Commission pursuant to
     Section 13 or 15(d) of the Exchange Act;

     (ii)    [Reserved.];

     (iii)   supply to the Trustee (and the Trustee shall transmit by mail to
     all Holders described in TIA Section 313(c), in the manner and to the
     extent provided therein) such summaries of any information, documents and
     reports required to be filed by the Depositor pursuant to clauses (i) and
     (ii) of this Section 5.09(a), if any, as may be required by rules and
     regulations prescribed from time to time by the Commission; and

     (iv)    after an Available Information Event, on behalf of the Trust,
     prepare and file with the Commission, following the execution thereof by
     the Trustee if so requested by the Depositor, and file with the Trustee,
     within 15 days after the Depositor on behalf of the Trust is required to
     file the same with the Commission, reports of the kind referred to in
     clause (i) of this Section 5.09(a) with respect to the Issuer of the
     Underlying Securities, to the extent such reports are then available to the
     Depositor, for as long as the Depositor on behalf of the Trust is required
     to file such reports under the Exchange Act. Such reports shall include
     quarterly and annual financial statements and other information of the type
     required to be filed on Form 8-K under the Exchange Act with respect to the
     Issuer of the Underlying Securities. A copy of each such report shall be
     provided to the Trustee at least 10 Business Days prior to the date
     required for filing. If such reports and information are not available to
     the Depositor at a time when such reports and information are required to
     be filed with the Commission by the Depositor on behalf of the Trust, the
     Depositor shall cause the removal of the Certificates from the DTC book-
     entry system as set forth in Section 2.08(iv)(5) of this Agreement and

<PAGE>

     shall notify the Issuer that the Holders of Certificates constitute record
     holders of the Underlying Securities for purposes of the Exchange Act.

     (b)    The Depositor shall deliver to the Trustee, not less often than
     annually, an Officer's Certificate signed by an Authorized Officer who is
     the principal executive officer, principal financial officer or principal
     accounting officer of the Depositor, dated as of the date set forth in the
     Series Trust Agreement for such year, stating that:

     (i)  a review of the activities of the Depositor during such fiscal year
          and of performance under this Agreement has been made under such
          Authorized Officer's supervision; and

     (ii) to the best of such Authorized Officer's knowledge, based on such
          review, the Depositor has fulfilled all of its obligations under this
          Agreement throughout such year, or, if there has been a default in the
          fulfillment of any such obligation, specifying each such default known
          to such Authorized Officer and the nature and status thereof. A copy
          of such certificate may be obtained by any Holder by a request in
          writing to the Depositor addressed to the Corporate Trust Office of
          the Trustee.

     (c)    If and only if the Series Trust Agreement provides for the pledge of
     the Underlying Securities to the Trustee (and not merely the transfer,
     assignment, conveyance and sale, without recourse, thereof to the Trustee),
     on the Closing Date, the Depositor shall furnish to the Trustee an Opinion
     of Counsel either stating that, in the opinion of such counsel, such action
     has been taken with respect to the recording and filing of this Agreement,
     any agreements supplemental hereto and any other requisite documents, and
     with respect to the execution and filing of any financing statements and
     continuation statements as are necessary to perfect and make effective the
     lien and security interest of this Agreement and reciting the details of
     such action, or stating that, in the opinion of such counsel, no such
     action is necessary to make such lien and security interest effective.

     (d)    If and only if the Series Trust Agreement provides for the pledge of
     the Underlying Securities to the Trustee (and not merely the transfer,
     assignment, conveyance and sale, without recourse, thereof to the Trustee),
     at least annually after the Closing Date, the Depositor shall furnish to
     the Trustee an Opinion of Counsel either stating that, in the opinion of
     such counsel, such action has been taken with respect to the recording,
     filing, re-recording and refiling of this Agreement, any agreements
     supplemental hereto and any other requisite documents and with respect to
     the execution and filing of any financing statements and continuation
     statements as is necessary to maintain the lien and security interest
     created by this Agreement and reciting the details of such action or
     stating that in the opinion of such counsel no such action is necessary to
     maintain the lien and security interest created by this Agreement. Such
     Opinion of Counsel shall also describe the recording, filing, re-recording
     and refiling of this Agreement, any agreements supplemental hereto and any
     other requisite documents and the execution and filing of any financing
     statements and continuation statements that will, in the opinion of such
     counsel, be required to maintain the lien and security interest of this
     Agreement until such date in the following calendar year.

                                     B-25
<PAGE>

     (e)    If and only if the Series Trust Agreement provides for the pledge of
     the Underlying Securities to the Trustee (and not merely the transfer,
     assignment, conveyance and sale, without recourse, thereof to the Trustee),

     (i)    whenever any property or securities are to be released from the lien
     of this Agreement, the Depositor shall furnish to the Trustee an Officer's
     Certificate of the Depositor certifying or stating the opinion of each
     Person signing such certificate as to the fair value (within 90 days of
     such release) of the property or securities proposed to be released and
     stating that in the opinion of such Person the proposed release will not
     impair the security under this Agreement in contravention of the provisions
     hereof.

     (ii)   whenever the Depositor is required to furnish to the Trustee an
     Officer's Certificate of the Depositor certifying or stating the opinion of
     any signatory thereof as to the matters described in clause (i) above, the
     Depositor shall also furnish to the Trustee an Independent Certificate as
     to the same matters if the fair value of the property or securities and of
     all other property or securities released from the lien of this Agreement
     since the commencement of the then current calendar year, as set forth in
     the certificates required by clause (i) above and this clause (ii), equals
     10% or more of the principal amount of the Outstanding Certificates, but
     such certificate need not be furnished in the case of any release of
     property or securities if the fair value thereof as set forth in the
     related Officer's Certificate of the Depositor is less than $25,000 or less
     than one percent of the then principal amount of the Outstanding
     Certificates.

     (iii)  prior to the deposit with the Trustee of any securities that is to
     be made the basis for the authentication and delivery of Certificates, the
     withdrawal of cash constituting a part of the trust estate or the release
     of any property or securities subject to the lien of this Agreement, the
     Depositor shall furnish to the Trustee an Officer's Certificate of the
     Depositor certifying or stating the opinion of each Person signing such
     certificate as to the fair value (within 90 days of such deposit) to the
     Depositor of the securities to be so deposited.

     (iv)   whenever the Depositor is required to furnish to the Trustee an
     Officer's Certificate of the Depositor described in clause (iii) above, the
     Depositor shall also deliver to the Trustee an Independent Certificate as
     to the same matters, if the fair value to the Depositor of the securities
     to be so deposited and of all other such securities made the basis of any
     such withdrawal or release since the commencement of the then current
     fiscal year of the Depositor, as set forth in the certificates delivered
     pursuant to clause (iii) above and this clause (iv), is 10% or more of the
     principal amount of the Outstanding Certificates, but such a certificate
     need not be furnished with respect to any securities so deposited, if the
     fair value thereof to the Depositor as set forth in the related Officer's
     Certificate of the Depositor is less than $25,000 or less than one percent
     of the principal amount of the Outstanding Certificates.

     (v)    subject to the payment of its fees and expenses hereunder, the
     Trustee may, and when required by the provisions of this Agreement, shall,
     execute instruments to release property from the lien of this Agreement, or
     convey the Trustee's interest in the same, in a manner and under
     circumstances that are consistent with the provisions of this Agreement.
     No party

                                     B-26
<PAGE>

     relying upon an instrument executed by the Trustee in connection therewith
     shall be bound to ascertain the Trustee's authority, inquire into the
     satisfaction of any conditions precedent or see to the application of any
     moneys.

     (vi)   the Trustee shall at such time as there are no Outstanding
     Certificates and all sums due to the Trustee hereunder have been paid,
     release any remaining portion of the trust estate that secured the
     Certificates from the lien of this Agreement and release to the Depositor
     or any other Person entitled thereto any funds then included in the trust
     estate.

     (f)    Upon any application or request by the Depositor to the Trustee to
     take any action under the provisions of this Agreement, which action is
     subject to the satisfaction of a condition precedent (including any
     covenants compliance with which constitutes a condition precedent), the
     Depositor shall furnish to the Trustee: (i) an Officer's Certificate
     stating that all conditions precedent, if any, provided for in this
     Agreement relating to the proposed action have been complied with, (ii) an
     Opinion of Counsel stating that in the opinion of such counsel all such
     conditions precedent, if any, have been complied with and (iii) (if
     required by the TIA) an Independent Certificate from a firm of certified
     public accountants meeting the applicable requirements of the TIA, except
     that, in the case of any such application or request as to which the
     furnishing of such documents is specifically required by any provision of
     this Agreement, no additional certificate or opinion need be furnished.
     Every certificate or opinion with respect to compliance with a condition or
     covenant provided for in this Agreement shall include:

     (i)    a statement that such signatory of such certificate or opinion has
     read or has caused to be 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 Statements or opinions contained in such
     certificate or opinion are based;

     (iii)  a statement that, in the judgment of each such signatory, such
     signatory has made such examination or investigations as is necessary to
     enable such signatory 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, in the opinion of each such signatory,
     such condition or covenant has been complied with.

Section 5.10  Preferential Collection of Claims Against Depositor.
              ---------------------------------------------------

     The Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent required by TIA
Section 311(a).

Section 5.11  Resignation and Removal of the Trustee; Appointment of Successor
              ----------------------------------------------------------------
Trustee.
-------

<PAGE>

     The Trustee may at any time resign as Trustee hereunder by written notice
of its election so to do, delivered to the Depositor and the Rating Agency as
provided in Section 9.04 hereof, and such resignation shall take effect upon the
appointment of a successor Trustee and its acceptance of such appointment as
hereinafter provided. The Depositor may at any time (including such time as the
Trustee fails to comply with Section 5.01) remove the Trustee as Trustee
hereunder by written notice of its election to do so, delivered to the Trustee
and the Rating Agency as provided in Section 9.04 hereof, and such removal shall
take effect upon the appointment of a successor Trustee and its acceptance of
such appointment as provided in the third succeeding paragraph; provided,
however, that in the event of such removal, the Depositor shall negotiate in
good faith with the Trustee in order to agree regarding payment of the
termination costs of the Trustee resulting from such removal. Upon the
designation of a successor Trustee following either resignation by or removal of
the Trustee, the Trustee shall deliver to the successor Trustee all records
relating to the Certificates in the form and manner then maintained by the
Trustee, which shall include a hard copy thereof upon request of the successor
Trustee.

     If at any time the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of its
property shall be appointed, or any public officer shall take charge or control
of the Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, or the Trustee shall fail to comply with Section
5.01, then any Holder of a Certificate with respect to a particular issue of
Underlying Securities which has been such a Holder for at least six (6) months
or the Holders of Outstanding Certificates representing ten percent (10%) of the
Voting Rights for the Outstanding Certificates of a series which is outstanding
at such time may, on behalf of himself, herself or themselves and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Trustee with respect to the Underlying Securities evidenced by such
Certificates and the appointment of a successor Trustee.

     In the event the Trustee resigns or is removed, the Trustee shall reimburse
the Depositor for any fees or charges previously paid to the Trustee in respect
of duties not yet performed under this Agreement which remain to be performed by
a successor Trustee and the Trustee shall promptly notify the Rating Agency of
its resignation or removal and any successor Trustee shall promptly notify the
Rating Agency of its appointment as provided in Section 9.04 hereof.

     In case at any time the Trustee acting hereunder notifies the Depositor
that it elects to resign or the Depositor notifies the Trustee that it elects to
remove the Trustee as Trustee, the Depositor shall, within ninety (90) days
after the delivery of the notice of resignation or removal, appoint a successor
Trustee, which shall be a bank with trust powers or a trust company having its
principal office in the United States of America and having a combined capital
and surplus of at least $50,000,000 and which is rated at least investment grade
by the Rating Agency. If no successor Trustee has been appointed as successor
Trustee within ninety (90) days after the Trustee has given written notice of
its election to resign or the Depositor has given written notice to the Trustee
of its election to remove the Trustee, as the case may be, the Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee. Every successor Trustee shall execute and deliver to its predecessor
and to the Depositor an instrument in writing accepting its appointment
hereunder, and thereupon such successor Trustee, without any further act or
deed, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor and for all purposes shall

                                     B-28
<PAGE>

be the Trustee under this Agreement, and such predecessor, upon payment of all
sums due it and on the written request of the Depositor, shall execute and
deliver an instrument transferring to such successor all rights, obligations and
powers of such predecessor hereunder, and shall duly assign, transfer and
deliver all right, title and interest in the Underlying Securities and parts
thereof to such successor. Any successor Trustee shall promptly give notice of
its appointment to the Holders of Certificates for which it is successor Trustee
as provided in Section 9.04 hereof.

     Any corporation into or with which the Trustee may be merged, consolidated
or converted shall be the successor of such Trustee without the execution or
filing of any document or any further act.

Section 5.12 Indemnification by the Depositor.
             --------------------------------

     The Depositor agrees to indemnify the Trustee and any of its agents,
officers, directors or employees for, and to hold them harmless against, any
loss, liability or expense arising, directly or indirectly, out of, relating to,
or in connection with the acceptance, administration or performance of their
duties, or the duties of the Trustee, as well as the costs and expenses of
defending themselves against any action, suit, or other proceeding involving any
claim or liability arising, directly or indirectly, out of, relating to or in
connection with, this Agreement, the Initial Trust Agreement or the exercise or
performance of any of their powers or duties hereunder or thereunder, other than
any loss, liability or expense arising out of (i) negligence, willful misconduct
or bad faith on the part of the Trustee or any of its agents, officers,
directors or employees, or (ii) any charges, fees or reimbursements that are
expressly required by this Agreement to be paid by the Holders or for which the
Holders are expressly required by this Agreement or have elected pursuant to the
terms of this Agreement to provide security or indemnity to the Trustee. Failure
of the Depositor to fulfill its obligations hereunder shall not relieve the
Trustee from fulfilling its duties under this Agreement.

     Any Person that proposes to assert the right to be indemnified under this
Section 5.12 (any such Person, an "Indemnified Party") shall, promptly after
receipt of notice of commencement of any action against such party in respect of
which a claim is to be made against the Depositor under this Section 5.12,
notify the Depositor of the commencement of such action, enclosing a copy of all
papers served, but the omission so to notify the Depositor shall not relieve the
Depositor from any liability that it may have to such Indemnified Party under
the foregoing provisions of this Section 5.12 unless, and only to the extent
that, such omission results in the forfeiture of rights or defenses by the
Depositor. If any such action is brought against an Indemnified Party and it
notifies the Depositor of its commencement, the Depositor shall be entitled to
participate in and, to the extent that it elects by delivering written notice to
the Indemnified Party promptly after receiving notice of the commencement of the
action from the Indemnified Party, to assume the defense of the action, with
counsel satisfactory to the Indemnified Party, and after notice from the
Depositor to the Indemnified Party of its election to assume the defense, the
Depositor shall not be liable to the Indemnified Party for any fees,
disbursements or other charges of counsel except as provided below and except
for the reasonable costs of investigation subsequently incurred by the
Indemnified Party in connection with the defense. The Indemnified Party shall
have the right to employ its own counsel in any such action, but the fees,
expenses and other charges of such counsel shall be at the expense of the
Indemnified Party unless (1) the employment of counsel by the Indemnified Party
has been

<PAGE>

authorized in writing by the Depositor, (2) the Indemnified Party has reasonably
concluded (based on advice of counsel) that there may be legal defenses
available to it or other Indemnified Parties that are different from or in
addition to those available to the Depositor, (3) a conflict or potential
conflict exists (based on advice of counsel to the Indemnified Party) between
the Indemnified Party and the Depositor (in which case the Depositor shall not
have the right to direct the defense of such action on behalf of the Indemnified
Party), or (4) the Depositor has not in fact employed counsel to assume the
defense of such action within 15 Business Days after receiving notice of the
commencement of the action, in each of which cases the reasonable fees,
disbursements and other charges of counsel shall be at the expense of the
Depositor. It is understood that the Depositor shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the
reasonable fees, disbursements and other charges of more than one separate firm
admitted to practice in such jurisdiction at any one time for all Persons
entitled to indemnification hereunder. All such fees, disbursements and other
charges shall be reimbursed by the Depositor promptly as they are incurred. The
Depositor shall not be liable for any settlement of any action or claim effected
without its written consent (which consent shall not be unreasonably withheld).
The Depositor shall not, without the prior written consent of each Indemnified
Party, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding relating to the matters
contemplated by this Section 5.12 (whether or not any Indemnified Party is a
party thereto), unless such settlement, compromise or consent includes an
unconditional release of each Indemnified Party from all liability arising or
that may arise out of such claim, action or proceeding. Notwithstanding any
other provision of this Section 5.12, if at any time an Indemnified Party shall
have requested the Depositor to reimburse the Indemnified Party for fees and
expenses of counsel, the Depositor agrees that it shall be liable for any
settlement effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by the Depositor of the aforesaid
request, (ii) the Depositor shall have received notice of the terms of such
settlement at least 30 days prior to such settlement being entered into, and
(iii) the Depositor shall not have reimbursed the Indemnified Party in
accordance with such request prior to the date of such settlement.

     The term "liability," as used in this Section 5.12, shall include any
losses, claims, damages, expenses (including without limitation the Trustee's
costs and expenses in defending itself against any losses, claims or
investigations of any nature whatsoever to the extent the Trustee is not
reimbursed as contemplated in this Section 5.12) or other liabilities, joint or
several, arising for any reason (including without limitation violation of
applicable laws or trademarks or service marks).

     The obligations of the Depositor under this Section 5.12 (i) shall be in
addition to any liability which the Depositor may otherwise have, (ii) shall
extend, upon the same terms and conditions, to each officer and director of the
Trustee and to each Person, if any, who controls the Trustee within the meaning
of the Securities Exchange Act of 1934, as amended (iii) shall survive the
termination of this Agreement and the resignation or removal of the Trustee, and
(iv) shall be limited to the extent set forth in the Depositor's certificate of
incorporation.

Section 5.13 Undertaking for Costs.
             ---------------------

     All parties to this Agreement agree, and each Holder of any Certificate by
such Holder's acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in

<PAGE>

any Proceeding for the enforcement of any right or remedy under this Agreement,
or in any Proceeding against the Trustee for any action taken, suffered or
omitted by it as Trustee, the filing by any party litigant in such Proceeding of
an undertaking to pay the costs of such Proceeding and that such court may in
its discretion assess reasonable costs, including reasonable attorneys, fees,
against any party litigant in such Proceeding, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 5.13 shall not apply to:

     (a) any Proceeding instituted by the Trustee;

     (b) any Proceeding instituted by any Holder, or group of Holders, in each
     case holding in the aggregate Outstanding Certificates representing more
     than 10% of the Voting Rights; or

     (c) any Proceeding instituted by any Holder for the enforcement of the
     payment of Principal or Interest on or after the respective due dates
     expressed in such Certificate and in this Agreement (or, in the case of
     redemption, on or after the Redemption Date).

Section 5.14 Charges and Expenses.
             --------------------

     Except as otherwise provided in this Agreement, (i) no current or future
charges, fees and expenses of the Trustee shall be payable by or withheld from
any Person other than the Depositor, except for any taxes and other governmental
charges, and (ii) in full payment and satisfaction of all other charges and
expenses of the Trustee (including, in each case, fees and expenses of counsel)
incidental to the performance of its obligations hereunder, the Depositor shall
pay the Trustee an amount determined in accordance with a separate agreement
between it and the Trustee. The Trustee shall not be released from any of its
duties hereunder as a result of the failure of the Depositor to pay such amount.

Section 5.15 Trustee Reports.
             ---------------

     (a)  So long as the Certificates are held in DTC's book-entry only system,
annual unaudited reports setting forth the amounts of payments on the
Certificates, and whether such amounts are principal or interest shall be
prepared by the Trustee and sent to DTC. To the extent the Depositor fails to
provide the Trustee with a copy of any report referred to in Section 5.09(a) (i)
herein prior to the 10th Business Day preceding the applicable filing date
therefor as required by such provisions, the Trustee shall request the Depositor
to prepare and file such report and, if the Depositor fails to do so, shall
cause such report to be prepared and filed and the Depositor shall reimburse the
Trustee for its reasonable expenses incurred in connection therewith. Any such
expenses not reimbursed by the Depositor shall be borne by the Holders.

     (b)  The Trustee shall, on behalf of the Trust, prepare and file with the
Commission, copies of the annual reports and of the information, documents and
other reports (or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations prescribe), if any,
which the Trust may be required to file with the Commission pursuant to Section
13 or 15(d) of the Exchange Act (collectively, "reports") with respect to the
Trust.

<PAGE>

                                  ARTICLE VI
                          HOLDERS' LISTS AND REPORTS

Section 6.1 Depositor to Furnish Names and Addresses of Holders to Trustee.
            --------------------------------------------------------------

     The Depositor shall furnish or cause to be furnished to the Trustee not
more than five days before each Interest Payment Date or Redemption Date, and at
such other times as the Trustee may request in writing, a list, in such form as
the Trustee may reasonably require, to the extent such information is in the
possession or control of the Depositor or any of its paying agents, of the
Holders of Certificates as of the close of business on the applicable record
date of the underlying Underlying Securities; provided, however, that so long as
the Trustee maintains the Certificate Register, no such list shall be required
to be furnished.

Section 6.2 Preservation of Information, Communications to Holders.
            -------------------------------------------------------

     (a)  The Trustee shall preserve, in as current a form as is reasonably
     practicable, the names and addresses of the Holders of Certificates
     contained in the most recent list furnished to the Trustee as provided in
     Section 6.01 and the names and addresses of Holders of Certificates
     received by the Trustee in its capacity as Certificate registrar. The
     Trustee may destroy any list furnished to it as provided in such Section
     6.01 upon receipt of a new list so furnished.

     (b)  Holders shall have the right to communicate pursuant to TIA Section
     312(b) with other Holders with respect to their rights under this Agreement
     or under the Certificates.

     (c)  The Depositor, the Trustee and the Certificate registrar shall have
     the protection of TIA Section 312(c).

Section 6.3 Reports by Trustee.
            ------------------

     If required by TIA Section 313(a), within 60 days after December 31 of each
year, the Trustee shall mail to (i) each Holder as required by TIA Section
313(c) and (ii) the Depositor, a brief report dated as of such date that
complies with TIA Section 313(a). The Trustee also shall comply with TIA Section
313(b). A copy of any report delivered pursuant to this Section 6.03 shall, at
the time of its mailing to Holders and the Depositor, be filed by the Trustee
with the Commission and each stock exchange, if any, on which the Certificates
are listed. The Depositor shall notify the Trustee if and when the Certificates
are listed on any stock exchange.

                                ARTICLE VII
                           AMENDMENT AND TERMINATION

Section 7.1 Amendment.
            ---------

     The form of the Certificates and any provisions of this Agreement may at
any time and from time to time be amended by agreement between the Depositor and
the Trustee in any respect which they may deem necessary or desirable, provided
that in no event shall any amendment defer or alter the maturity of a
Certificate, or in other manner adversely affect the rights to payment of a
Holder of a Certificate or otherwise materially prejudice any substantial
existing right of the Holders of the

                                     B-32
<PAGE>

Certificates; and provided further that at the time of any amendment the Trustee
shall be provided evidence that the rating on the Certificates by the Rating
Agency will not be lowered or withdrawn as a result of the amendment. Every
Holder of a Certificate at the time any such amendment so becomes effective
shall be deemed to be continuing to hold such Certificate, to consent and agree
to such amendment and to be bound by this Agreement as amended thereby. Prior to
entering into any amendment to the form of the Certificates or this Agreement,
the Trustee shall be entitled to receive an Opinion of Counsel to the effect
that such amendments are authorized or permitted by this Agreement and that all
conditions precedent to the execution and delivery of such amendments have been
satisfied. The costs of providing such Opinion of Counsel shall be borne by the
Holders requesting that the Trustee execute and deliver such amendment. The
Trustee shall notify the Holders of the estimated expense of any such Opinion of
Counsel.

Section 7.2 Termination.
            -----------

     This Agreement shall terminate one year following the payment upon maturity
(or any earlier redemption) by the respective Issuers of the entire principal
amount (and any redemption premium) of the Underlying Securities or, in the
event of a default on the Underlying Securities, one year following receipt by
the Holders of all amounts to which the Holders are entitled pursuant to Section
5.03(b) hereof. If any Certificates shall remain outstanding after the date of
termination of this Agreement, the Trustee shall not perform any further acts
under this Agreement, except that the Trustee shall hold the proceeds of any
payment, without liability for interest, for the pro rata benefit of the Holders
of Certificates which have not theretofore been surrendered for payment unless
otherwise required by applicable law. Upon the termination of this Agreement,
the Depositor shall be discharged from all obligations under this Agreement
except for its obligations to the Trustee under Sections 5.15 and 5.13 hereof.

                                ARTICLE VIII
                          REDEMPTION OF CERTIFICATES

Section 8.1 Redemption.
            ----------

     If the Underlying Securities are redeemed in whole or in part on or after
the First Call Date, upon actual receipt by the Trustee of notice of such
redemption, the Trustee shall, in accordance with the provisions of this Article
VIII, redeem a principal amount of Pooled Certificates, Callable Principal
Certificates or Callable Stripped Underlying Security Certificates, as
applicable, equal to the principal amount of the Underlying Securities of such
issue held in trust hereunder so redeemed, and if the Underlying Securities are
redeemed in part, then the Trustee shall select the Certificates to be redeemed
by lot in such manner as the Trustee deems fair and appropriate. In the absence
of the actual notice described in this Section 8.01, the Trustee shall be under
no obligation to effect the redemption required by this Section 8.01. Upon
redemption of any Certificate, the Holder shall have no right to receive
payments on any Interest maturing after the Redemption Date.

Section 8.2 Notice of Redemption.
            --------------------

     Notice of redemption shall be given by the Trustee to each Holder of any
Certificate to be redeemed as provided in Section 9.04 hereof within thirty (30)
days after notice of redemption of the

<PAGE>

underlying Underlying Securities has been given by the Issuer, trustee or paying
agent of or for the Underlying Securities, as the case may be (but not less than
fifteen days prior to the redemption date); provided, however, that the Trustee
shall not be required to give any notice of redemption less than five (5)
Business Days after the date it receives notice of such redemption. All notices
of redemption shall be mailed to each Holder at such Holder's last address on
the Certificate Register and shall state the Redemption Date, the date the
Certificates are to be redeemed, the amount payable on such date, the place at
which Certificates are to be surrendered for payment and that interest on
amounts redeemed shall cease to accrue on and after the Redemption Date.

                                  ARTICLE IX
                                 MISCELLANEOUS

Section 9.1 Exclusive Benefit of Parties and Holders of Certificates; Effective
            -------------------------------------------------------------------
Date.
----

     This Agreement is for the exclusive benefit of the parties hereto, their
respective successors hereunder, and Holders of Certificates, and shall not be
deemed to give any legal or equitable right, remedy or claim to any other Person
whatsoever. The Holders from time to time shall be beneficiaries of this
Agreement and shall be bound by all the terms and conditions hereof and of the
Certificates by acceptance of delivery thereof. This Agreement shall become
effective as to the Trustee and the Depositor for each series of Certificates
upon the execution of the Series Trust Agreement for such series by the Trustee
and Depositor and the receipt by the Trustee of the Underlying Securities
deposited therewith.

Section 9.2 Invalidity of Provisions.
            ------------------------

     In case any one or more of the provisions contained in this Agreement or
contained in the Certificates should be or become invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein or therein shall in no way be affected,
prejudiced or disturbed thereby.

Section 9.3 Conflict with Trust Indenture Act.
            ---------------------------------

     (a)  If any provision hereof limits, qualifies or conflicts with another
     provision hereof that is required to be included in this Agreement by any
     of the provisions of the TIA, such required provision shall control.

     (b) The provisions of TIA Sections 310 through 317 that impose duties on
     any Person (including the provisions automatically deemed included herein
     unless expressly excluded by this Agreement) are a part of and govern this
     Agreement, whether or not physically contained herein.

Section 9.4 Notices.
            -------

     Any and all notices to be given to the Depositor shall be deemed to have
been duly given if personally delivered or sent by mail, first class, post
prepaid, or telegram or telex or facsimile confirmed by letter addressed to the
Depositor at the Depositor Address set forth in the Series Trust

                                     B-34
<PAGE>

Agreement relating to Certificates evidencing Underlying Securities deposited by
the Depositor, or at any other place as the Depositor shall notify the Trustee
in writing from time to time.

     Any and all notices to be given to the Trustee shall be deemed to have been
duly given if personally delivered or sent by mail, first class, post prepaid,
or facsimile confirmed by letter addressed to the Trustee at the Trustee Address
set forth for notice to the Trustee in the Series Trust Agreement, or to such
other place which the Trustee may have designated in writing to the Depositor.

     Any and all notices to be given to the Rating Agency shall be deemed to
have been duly given if personally delivered or sent by mail, first class, post
prepaid, or facsimile confirmed by letter addressed to the Rating Agency at the
Rating Agency Address set forth in the Series Trust Agreement, or to such other
place which the Rating Agency may have designated in writing to the Depositor
and the Trustee.

     All other notices to be given to any Holder shall be deemed to have been
duly given if given by mail, first-class postage prepaid, to each Holder at such
Holder's address as it appears in the Certificate Register. Neither the failure
to mail such notice, nor any defect in any notice so mailed, to any particular
Holder shall affect the sufficiency of such notice with respect to other
Holders.

     All notices specified to be given "promptly" hereunder shall be given no
later than the second Business Day after the event which results in the
requirement that the notice be delivered.

Section 9.5 Governing Law; Forum.
            --------------------

     This Agreement and the Certificates shall be governed by, and construed in
accordance with, the laws of the State of New York. Any action or proceeding
alleging a breach of an obligation under this Agreement shall be prosecuted only
in a state or federal court located in the State of New York, County of New
York.

Section 9.6 Headings.
            --------

     The headings of articles and sections in this Agreement have been inserted
for convenience only and are not to be regarded as a part of this Agreement or
to have any bearing upon the meaning or interpretation of any provision
contained herein or in the Certificates.

Section 9.7 Covenant of Depositor and Trustee Not to Place Trust in Bankruptcy.
            ------------------------------------------------------------------

     Each party hereto covenants that it shall not, until at least one year and
one day after the termination of this Agreement, take any action to file an
involuntary bankruptcy petition against the Trust or cause the Trust to file a
voluntary bankruptcy petition.

Section 9.8 Trust Not to Merge.
            ------------------

                                     B-35
<PAGE>

     For so long as any Certificate remains outstanding, the Trust shall not
merge or consolidate with or into any Person, or transfer all or substantially
all of its assets to any Person.

Section 9.9 Incurrence of Indebtedness.
            --------------------------

For so long as any Certificate remains outstanding, the Trust shall not create,
assume, incur, suffer to exist or otherwise become or remain liable in respect
of any indebtedness.

                                     B-36

<PAGE>

                                                                       EXHIBIT C
                                                       TO SERIES TRUST AGREEMENT

                              TRUST CERTIFICATES
                                   issued by
                NFSC TRUST 2000-__ FOR [UNDERLYING SECURITIES]

           POOLED CERTIFICATE (principal amount $__ per certificate)
             For a Pro Rata Share of All Interest Payments on the
            [Underlying Securities] and All Principal Payments and
            Redemption Premium, If Any, Due on the Stated Maturity
        Date Indicated Below or on any Previous Call for Redemption on

                            [UNDERLYING SECURIITES]

Certificate No. 1                        Face Amount: $__,000,000
Number of Certificates: __,000,000
CUSIP No.: __________                    Stated Maturity Date: ________ __, 20__

CEDE & CO., or registered assigns, is the owner of the face amount set forth
above of certificates evidencing 100% beneficial ownership of NFSC Trust 2000-__
for [Underlying Securities] (the "Issuer"), whose sole asset consists of
$__,000,000 of [Underlying Securities] (the "Underlying Securities"). The sole
obligor with respect to such Underlying Securities is the issuer of the
Underlying Securities named above (the "Underlying Issuer") or any other
entities obligated to make payments to or on behalf of the Underlying Issuer (or
their trustees or other applicable fiduciaries) with respect to the Underlying
Securities. The Underlying Securities are being held in a trust account by
[_________________], as Trustee, pursuant to the terms of a Trust Agreement
dated as of ________ __, 2000 (the "Agreement"), including the Standard Terms
and Provisions of Series Trust Agreement appended thereto and all other
exhibits, schedules, appendices, supplements and amendments thereto, between
National Financial Securities Corporation, as Depositor, and the Trustee,
pursuant to which this and other certificates (the "Certificates"), evidencing
the right to receive all interest and principal payments, including the
redemption premiums, if any, but excluding the Retained Amount (as defined in
the Agreement), if any, on the Underlying Securities, are executed and delivered
by the Trustee. This Certificate is subject to the provisions of and is entitled
to the benefits of the Agreement, which may be inspected by the holder hereof at
the Designated Office in New York City of the Trustee. The owner of this
Certificate, by its acceptance hereof, agrees to be bound by the terms and
conditions of the Agreement. Capitalized terms used but not defined herein shall
have the meanings set forth in the Agreement.
<PAGE>

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

The Underlying Securities will be held in an account of the Trustee at DTC in
book-entry credit form. The Trustee will pay to the Holder of this Certificate
its pro rata share of all amounts received as payments on the Underlying
Securities, promptly after receipt, less any amounts required to be withheld
from or by the Trustee pursuant to applicable law, in lawful money of the United
States of America, (i) if the Holder is The Depository Trust Company ("DTC") or
its nominee or any successor depository or nominee thereof, by wire transfer of
immediately available funds, and (ii) if the Holder is any other person, by
check in immediately available funds sent by first-class mail to the address of
the Holder hereof set forth in the Certificate Register.

In the event the Trustee receives money or other property in connection with the
payment of principal (or actual notice that such moneys or other property will
be received), other than in connection with a redemption, prior to the Stated
Maturity Date, the Trustee shall promptly give notice, as provided in the
Agreement, to the Holder. Such notice shall state that, not later than ninety
(90) days after the receipt of such moneys or other property, the Trustee shall
distribute such moneys or other property pro rata to the Holders of
Certificates.

As provided in the Agreement and subject to certain limitations therein set
forth, the transfer of this Certificate is registrable in the Certificate
Register, upon surrender of this Certificate for registration of transfer at the
corporate trust office of the Trustee at [________________], duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the
Trustee duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
series having the Stated Maturity Date set forth on the face hereof, of
Authorized Denominations of $__ or greater multiples of $__, and having the same
aggregate face amount, will be issued to the designated transferee or
transferees. Under the Agreement, the Trustee is required, when making any
payment to a Holder, to round down such payment to the nearest whole cent.

The Certificates are issuable only in registered form in Authorized
Denominations. As provided in the Agreement and subject to certain limitations
therein set forth, such Certificates are exchangeable for Certificates of the
same series, having the same Stated Maturity Date and of a like aggregate face
amount, as requested by the Holder surrendering the same.

For any such registration of transfer or exchange, the Trustee may require
payment of the then applicable service charge and of a sum sufficient to cover
any tax or other governmental charge
<PAGE>

payable in connection therewith. Prior to due presentment of this Certificate
for registration of transfer, the Trustee and any agent of the Trustee may treat
the person in whose name this Certificate is registered as the owner hereof for
all purposes, whether or not this Certificate be overdue, and neither the
Trustee nor any such agent shall be affected by notice to the contrary.

This Certificate shall not be valid or become obligatory for any purpose unless
and until duly executed by the Trustee by manual signature.

Dated: _______ __, 2000

                                     [__________________], as Trustee

                                     By: _______________________________________
                                     Authorized Signatory

                               Authentication

     This is one of the Certificates referred to in the within-mentioned Trust
     Agreement.

                                     [____________________], as Trustee

                                     By: _______________________________________
                                     Authorized Signatory
<PAGE>

                                 TRANSFER FORM

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto__________________________________________________________________________
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint_________________________________________________________
________________________________________________________________________________
attorney to transfer the within Certificate on the books kept for the
registration thereof, with full power of substitution in the premises.

Optional:

[Insert wire transfer instructions for transferee.] Neither the transferor nor
the Trustee shall have any responsibility for the accuracy of such wire transfer
instructions, if provided.

Dated:_____________

                                 ______________________________________________
                                 (Signature)

                                 NOTE: Signature must conform in every
                                 particular to the name in which this security
                                 is registered, without any alteration or change
                                 whatsoever.

                                 Signature must be guaranteed by an "eligible
                                 guarantor institution" meeting the requirements
                                 of the Trustee, which requirements include
                                 membership or participation in STAMP or such
                                 other "signature guarantee program" as may be
                                 determined by the Trustee in addition to, or in
                                 substitution for, STAMP, all in accordance with
                                 the Securities Exchange Act of 1934.
<PAGE>

                                                                       EXHIBIT D
                                                       TO SERIES TRUST AGREEMENT

                             OFFICER'S CERTIFICATE
                                 OF [TRUSTEE]

     The undersigned, being a [Senior Vice President] of [TRUSTEE] (the "Bank"),
does hereby certify and agree on behalf of the Bank, for the benefit of National
Financial Securities Corporation (the "Depositor") and the beneficial owners of
the Certificates (as defined below), that:

1.  The Trust Agreement dated as of ________ __, 20__, including the Standard
    Terms and Provisions of Series Trust Agreement (the "Trust Agreement"),
    between the Depositor and[TRUSTEE], as Trustee (the "Trustee"), has been
    duly executed and delivered in the name of and on behalf of the Bank.

2.  Pursuant to the provisions of Section 2.01 of the Trust Agreement, the
    Trustee has issued $__,000,000 face amount of Trust Certificates (the
    "Certificates").

3.  The Bank is a [state chartered bank and trust company organized under the
    laws of the State of New York] [whose deposits are insured by the FDIC], and
    has the power to act as trustee with respect to the Certificates.

4.  Immediately prior to the transfer of any of the [UNDERLYING SECURITIES] (the
    "Underlying Securities") to the Trustee pursuant to the Trust Agreement, the
    Trustee did not have record or beneficial ownership of such Underlying
    Securities.

5.  By means of separate recordation upon the books of the Trustee, or by
    physical segregation, if appropriate, the Underlying Securities will always
    be segregated and kept separate from the assets of the Bank and from all
    other trust or fiduciary accounts, and will always be specifically
    identified as property held subject to a trust. The Trust Agreement will
    always be maintained as an official record in the books and records of the
    Trustee. The Trustee will always hold the Underlying Securities as required
    by the Trust Agreement, will always keep its trust records separate and
    distinct from its other records, will always ensure its trust records are
    complete, will always comply with all applicable laws, regulations, and
    rules relating to the custody of assets held in a trust relationship, and
    will always take whatever steps are necessary to ensure that, should the
    [superintendent of banks for the State of New York (the "Superintendent")]
    take possession of the Trustee, or a receiver or liquidator for the Trustee
    be appointed, at such time the Underlying Securities would be identifiable
    as property held subject to the trust relationship by the Trust Agreement.
    At all times that the Underlying Securities are credited to an account
    maintained on behalf of the Trustee at The Depository Trust Company of New
    York, the Bank will reflect on its records that the Underlying Securities
    are held in a trust account subject to the Trust Agreement, which account
    will contain no property of the Trustee in its individual capacity.

6.  At no time will the Bank receive a loan or other credit from a third person
    because of such third party's reliance upon the Bank's apparent ownership of
    the beneficial interests in the Underlying Securities.
<PAGE>

7.  Each person who, on behalf of the Bank, executed the Trust Agreement was at
    the date thereof and is now duly authorized as a signatory of the Bank and
    duly authorized to perform such acts at the respective times of such acts
    and the signatures of such persons appearing on such documents are their
    genuine signatures.

8.  The Trust Agreement has been duly and validly authorized, executed and
    delivered by the Bank and is enforceable against the Bank in accordance with
    its terms, except as the enforceability thereof may be limited by
    bankruptcy, insolvency or similar laws affecting creditors' rights generally
    and by general principles of equity.

                           [SIGNATURE PAGE FOLLOWS]

                                     8.1-2
<PAGE>

     IN WITNESS WHEREOF, the undersigned has caused this certificate to be duly
executed.

                                 [____________________], as Trustee

                                 By________________________________
                                 Name:
                                 Title:

Dated: ________ __, 20__

                                     8.1-3FIRST AMENDMENT

                                       TO

                          SECURITIES PURCHASE AGREEMENT

         FIRST  AMENDMENT (this "First  Amendment")  dated as of May 5, 2000, by
and among PROMEDCO MANAGEMENT  COMPANY, a Delaware  corporation (the "Company"),
GS CAPITAL  PARTNERS III, L.P., a Delaware  limited  partnership  ("GSCP"),  and
certain  affiliates  of GSCP  set  forth  on the  signature  page of this  First
Amendment (the "GSCP Affiliates", and collectively with GSCP and including their
respective  successors and assigns, the "Investors",  and each individually,  an
"Investor").

         WHEREAS,  the  Company  and the  Investors  previously  entered  into a
Securities Purchase Agreement (the "Securities  Purchase Agreement") dated as of
January 13, 2000; and

         WHEREAS,  the Company and the Investors  desire to amend the Securities
Purchase Agreement as set forth herein.

         NOW, THEREFORE, the parties hereto agree as follows:

         SECTION 1. Defined Terms; Interpretation. Unless otherwise specifically
defined  herein,  each term  used  herein  which is  defined  in the  Securities
Purchase  Agreement  has the  meaning  assigned  to such term in the  Securities
Purchase  Agreement.  Each  reference  to  "hereof",  "hereunder",  "herein" and
"hereby" and each other similar reference and each reference to "this Agreement"
and each other similar reference  contained in the Securities Purchase Agreement
shall from and after the  effective  date of this First  Amendment  refer to the
Securities  Purchase Agreement as amended hereby,  except in any instance in the
Securities  Purchase  Agreement where any such reference  relates to the date of
the  execution  of the  Securities  Purchase  Agreement in which  instance  such
reference  shall relate to the  Securities  Purchase  Agreement  without  giving
effect to this amendment.

         SECTION 2.  Amendments.  The  Securities  Purchase  Agreement is hereby
amended as follows:

         (a) The second and third  "Whereas"  clauses  are  hereby  amended  and
restated in their entirety as follows:

                  WHEREAS,  upon the terms and  subject  to the  conditions  set
forth in this  Agreement,  at the second  closing  (the "Second  Closing"),  the
Company  wishes to issue and sell to the  Investors,  and the Investors  wish to
purchase  from the  Company,  an aggregate  of 425,000  shares of the  Company's
Series A Convertible  Preferred  Stock, par value $0.01 per share (the "Series A
Preferred Stock") and warrants (the "Warrants") to purchase up to 125,000 shares
of the Company's Series B Convertible Preferred Stock, par value $0.01 per share
(the "Series B Preferred Stock"; and together with the Series A Preferred Stock,
the "Preferred Stock"); and

                  WHEREAS,  the Investors and the Company  desire to provide for
the purchase and sale of the Notes, the GS Shares,  the Series A Preferred Stock
and the Warrants and to establish  certain rights and  obligations in connection
therewith.

         (b) The  definitions of  "Additional  Financing"  and  "Certificate  of
Designation" in Section 1.1 are hereby deleted.

         (c) The following  definitions  from Section 1.1 are hereby amended and
restated in their entirety:

                  "Conversion  Shares"  shall  mean the  shares of Common  Stock
issuable  upon  conversion  of the  Series A  Preferred  Stock and the  Series B
Preferred Stock.

                  "Preferred  Stock" shall mean the Series A Preferred Stock and
the Series B Preferred Stock.

                  "Second  Closing  Payment" shall be an amount in cash equal to
$795,000  payable to the Investors at the Second  Closing as provided in Section
2.4.

                  "Shareholder  Rights Plan" shall mean the Agreement,  dated as
of February 18, 1997,  between the Company and Harris Trust  Company,  as Rights
Agent, as amended.

                  "Standstill Period" shall mean the period from the date hereof
until the later of (i) the third  anniversary  of the date  hereof  and (ii) the
date on which GSCP and the GSCP  Affiliates  and  Affiliates  controlled by them
beneficially  own,  in the  aggregate,  a  number  of  shares  of  Common  Stock
constituting  less than 10.0% of the Second  Closing  Ownership  Amount (as such
ownership  may be adjusted  from time to time for stock  splits,  reverse  stock
splits,  dividends paid in Common Stock,  reclassifications of the Common Stock,
and other similar events).

                  "Transaction Documents" shall mean this Agreement,  the Notes,
the Warrant Agreement, the Voting Agreements, the Lock-up Agreements, the Series
A Certificate  of  Designation,  the Series B Certificate  of  Designation,  the
Registration  Rights Agreement and all other contracts,  agreements,  schedules,
certificates  and other documents  being delivered  pursuant to or in connection
with this Agreement or the transactions contemplated hereby or thereby.

         (d)      The following definitions are hereby added to Section 1.1:

         "Amended and Restated Credit Agreement" shall have the meaning ascribed
thereto in Section 5.3.

                  "PIK  Notes"  shall have the meaning  ascribed  thereto in the
Notes.

                  "Series A Certificate of  Designation"  shall have the meaning
ascribed thereto in Section 2.6(a)(iv).

                  "Series B Certificate of  Designation"  shall have the meaning
ascribed thereto in Section 2.6(a)(v).

                  "Second  Closing  Ownership  Amount"  shall mean the number of
shares of Common  Stock  beneficially  owned by the  Investors  as of the Second
Closing (excluding the number of shares of Common Stock issuable upon conversion
of the Series B Preferred Stock).

                  "Series A Preferred  Stock"  shall have the  meaning  ascribed
thereto in the recitals.

                  "Series B Preferred  Stock"  shall have the  meaning  ascribed
thereto in the recitals.

                  "Warrant Agreement" shall have the meaning ascribed thereto in
Section 2.6(a)(iii).

                  "Warrant  Shares"  shall mean the shares of Series B Preferred
Stock issuable upon exercise of the Warrants.

                  "Warrants"  shall  have the  meaning  ascribed  thereto in the
recitals.

         (e) The  heading of Article II is hereby  amended  and  restated in its
entirety as follows:

                                 ARTICLE II
  ISSUANCE AND SALE OF NOTES, GS SHARES, SERIES A PREFERRED STOCK AND WARRANTS

         (f) Section  2.4 is hereby  amended  and  restated  in its  entirety as
follows:

                  2.4.  Second  Issuance,  Purchase and Sale. Upon the terms and
subject to the conditions set forth herein,  at the Second Closing,  the Company
shall issue and sell to each Investor, and each Investor shall purchase from the
Company, the number of shares of Series A Preferred Stock and Warrants set forth
opposite such  Investor's  name on the signature page of the First  Amendment to
this Agreement (i) for an aggregate  cash purchase  price equal to  $26,500,000,
minus the sum of (x) the Second  Closing  Payment,  (y) any  accrued  and unpaid
interest on the Notes through and including the Second  Closing Date and (z) the
aggregate  principal  amount of any PIK Notes issued to the  Investors  together
with any accrued and unpaid  interest  thereon  through and including the Second
Closing Date (the "Second  Closing Cash Purchase  Price"),  and (ii) in exchange
for all of the Notes  and GS  Shares  issued  to such  Investor  at the  Initial
Closing  (the  transactions  to  occur  at  the  Second  Closing,   the  "Second
Purchase");  provided,  that the  Investors  shall have the right to  reallocate
among the Investors the Series A Preferred Stock and Warrants to be purchased by
each Investor by delivering  written notice of such  reallocation to the Company
not  less  than  three  days  prior  to the  Second  Closing  so  long  as  such
reallocation  does not change the total  number of Series A Preferred  Stock and
Warrants being  acquired  hereunder or the Second Closing  Purchase  Price.  The
Company and the Investors  agree that for U.S.  federal,  state and local income
Tax purposes, the portion of the Second Closing Cash Purchase Price allocable to
the Warrants  shall be $547,797.  The Company and the Investors  agree that they
shall not take any position inconsistent with any such allocation.

         (g) Section  2.6(a) is hereby  amended and  restated in its entirety as
follows:

         (a) At the Second  Closing,  the Company shall deliver to the Investors
the following:

                           (i) certificates  representing the shares of Series A
         Preferred  Stock in the amounts set forth opposite such Investor's name
         on the signature page to the First Amendment to this Agreement;

                           (ii) certificates representing the number of Warrants
         being  purchased by each Investor as set forth opposite such Investor's
         name on the signature page to the First Amendment to this Agreement;

                           (iii) an executed copy of the Warrant  Agreement,  in
         the form of Exhibit A to the First  Amendment  to this  Agreement  (the
         "Warrant Agreement");

                           (iv) a copy of the  Certificate of Designation of the
         Series A Preferred  Stock (the "Series A Certificate of  Designation"),
         as filed with the Secretary of State of the State of Delaware;

                           (v) a copy of the  Certificate  of Designation of the
         Series B Preferred  Stock (the "Series B Certificate of  Designation"),
         as filed with the Secretary of State of the State of Delaware;

                           (vi) a copy  of the  executed  Amended  and  Restated
         Credit Agreement and evidence,  satisfactory to the Investors, that the
         transactions  contemplated  thereunder  shall have  closed  prior to or
         simultaneously with the Second Closing;

                           (vii) an opinion of the Company's  counsel,  dated as
         of the Second  Closing Date,  addressed to the Investors in the form of
         Exhibit B to the First Amendment to this Agreement, which opinion shall
         be satisfactory to the Investors;

         (viii) a copy of the resolutions adopted by the Company's  stockholders
at the  Stockholders  Meeting,  which  resolutions  shall be satisfactory to the
Investors;

         (ix)  evidence,  satisfactory  to the  Investors,  that  the  Preferred
Designees  have been  appointed to the Board of Directors  and that the Board of
Directors consists of ten directors effective as of the Second Closing;

         (x) evidence,  satisfactory  to the Investors,  that the Warrant Shares
have been reserved for issuance and delivery;

         (xi)  evidence,  satisfactory  to the  Investors,  that the  Conversion
Shares have been  reserved  for issuance and  delivery  upon  conversion  of the
Preferred Stock;

         (xii) copies of all third-party consents required to be obtained by the
Company  prior to the Second  Closing  as set forth on  Schedule  6.2(h),  which
consents shall be satisfactory to the Investors;

         (xiii) an Officers'  Certificate,  dated as of the Second Closing Date,
certifying that the conditions set forth in Sections 6.2(a) and 6.2(b) have been
satisfied; and

         (xiv) such other instruments and documents as the Investors  reasonably
request.

         (h) Section  2.6(b)(ii) is hereby  amended by adding the words "and any
PIK Notes issued to the Investors  prior to the Second  Closing" after the words
"Initial Closing".

         (i) The  heading  and  preamble  of Article  III is hereby  amended and
restated in its entirety as follows:

                                   ARTICLE III

                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

                  The Company  hereby  represents and warrants to each Investor,
as of January 13, 2000 with respect to all representations and warranties and as
of May 5, 2000 with  respect to all  representations  and  warranties  that were
modified by the First Amendment to this Agreement,  and as of the Second Closing
Date with respect to all of the  representations  and  warranties (to the extent
the Second Closing is consummated), as follows:

         (j) Section  3.2 is hereby  amended  and  restated  in its  entirety as
follows:

                  3.2. Due Authorization.  The Company has all right,  corporate
power  and  authority  to  enter  into  this  Agreement  and  each of the  other
Transaction  Documents to which it is a party and to consummate the transactions
contemplated  hereby and thereby.  The  execution and delivery by the Company of
this  Agreement  and each of the other  Transaction  Documents  to which it is a
party, the issuance and sale of the Notes, the GS Shares, the Series A Preferred
Stock and the  Warrants by the Company and the  compliance  by the Company  with
each of the  provisions  of this  Agreement  and each of the  other  Transaction
Documents to which it is a party  (including the reservation and issuance of the
Conversion  Shares,  the  reservation  and issuance of Warrant  Shares,  and the
consummation by the Company of the transactions contemplated hereby and thereby)
(a) are within the  corporate  power and  authority  of the Company and (b) have
been duly authorized by all requisite  corporate  proceedings on the part of the
Company,  except for the approval by the stockholders of the Company  referenced
in Section 5.6. The Board of Directors has  determined  that it is advisable and
in the best interest of the Company's stockholders for the Company to consummate
the issuance and sale of the Notes, the GS Shares,  the Series A Preferred Stock
and the Warrants upon the terms and subject to the  conditions set forth in this
Agreement,  and has  unanimously  recommended  that the  Company's  stockholders
approve the transactions referenced in Section 5.6. As of May 5, 2000, the Board
of Directors consists of eight directors and the Initial Noteholder Designee has
been  duly  appointed  to serve as a member of the  Board of  Directors  and the
Executive  Committee  of the Board of  Directors  as of January 20,  2000.  This
Agreement  has been,  and each of the other  Transaction  Documents to which the
Company is a party when  executed and delivered by the Company will be, duly and
validly executed and delivered by the Company,  and this Agreement  constitutes,
and each of such other Transaction  Documents when executed and delivered by the
Company  will  constitute,   a  valid  and  binding  agreement  of  the  Company
enforceable  against  the  Company  in  accordance  with its  terms,  except  as
enforceability  against  the Company  may be limited by  applicable  bankruptcy,
insolvency,  reorganization,  moratorium  or similar  Laws now or  hereafter  in
effect  relating to the rights of creditors  generally.  The GS Shares have been
duly and validly issued and are outstanding,  fully paid and  nonassessable.  At
the Second Closing, the Conversion Shares will be validly reserved for issuance,
and upon issuance in accordance with the Series A Certificate of Designation and
Series  B  Certificate  of  Designation  will be duly  and  validly  issued  and
outstanding,  fully paid and nonassessable.  At the Second Closing,  the Warrant
Shares will be validly  reserved for  issuance,  and upon issuance in accordance
with the terms of the Warrants will be duly and validly issued and  outstanding,
fully paid and nonassessable.

         (k) Section  3.3 is hereby  amended  and  restated  in its  entirety as
follows:

                  3.3.  Capitalization.  As of January 13, 2000 and May 5, 2000,
the authorized capital stock of the Company consists of (i) 50,000,000 shares of
Common Stock,  of which  21,732,423  shares are issued and  outstanding and (ii)
20,000,000  shares of preferred  stock,  par value $0.01 per share,  of which no
shares are issued and outstanding.  All of the issued and outstanding  shares of
Common Stock have been duly  authorized and are validly  issued,  fully paid and
nonassessable. Other than the shares of Series A Preferred Stock to be issued to
the Investors at the Second Closing and the Warrant Shares, no shares of capital
stock of the Company are entitled to preemptive  rights.  Except as set forth on
Schedule  3.3,  as  disclosed  in the SEC  Reports  or as  contemplated  by this
Agreement  or  the  other  Transaction  Documents,   there  are  no  outstanding
subscription rights, options,  warrants,  convertible or exchangeable securities
or other  rights of any  character  whatsoever  relating  to issued or  unissued
capital stock of the Company,  or any  Commitments  of any character  whatsoever
relating to issued or unissued capital stock of the Company or pursuant to which
the Company or any of the  Subsidiaries is or may become bound to issue or grant
additional shares of its capital stock or related subscription rights,  options,
warrants,  convertible or exchangeable  securities or other rights,  or to grant
preemptive rights.  Except as set forth on Schedule 3.3, as disclosed in the SEC
Reports or as contemplated by this Agreement or the other Transaction Documents,
(i) the Company has not agreed to register any  securities  under the Securities
Act or under any state  securities  law or  granted  registration  rights to any
Person or entity and (ii) there are no voting trusts,  stockholders  agreements,
proxies or other Commitments or understandings in effect to which the Company is
a party or of which it has  Knowledge  with respect to the voting or transfer of
any of the shares of Common  Stock.  Except as set forth on Schedule 3.3, to the
extent that any options, warrants or any of the other rights described above are
outstanding,  neither the  issuance  and sale of the Notes,  the GS Shares,  the
Preferred Stock, the Warrants,  nor the issuance of any Conversion Shares or the
Warrant Shares will result in an adjustment of the exercise or conversion  price
or  number  of shares  issuable  upon the  exercise  or  conversion  of any such
options, warrants or other rights.

         (l) Section 3.9 of the Securities  Purchase Agreement is hereby amended
by adding the following
paragraph (c) to the end thereof:

                  (c) The  Company  has  received  all  consents  required to be
obtained  prior to the  execution  and  delivery of the First  Amendment to this
Agreement  including,  without  limitation,  the consent of the Required Lenders
under the Credit  Agreement to the transactions  contemplated  hereby and by the
other  Transaction  Documents.  The Company  has  delivered  to the  Investors a
complete and correct copy of a commitment  letter from General  Electric Capital
Corporation  relating  to its  agreement  to purchase  $20 million in  aggregate
principal  amount of the  Company's  Tranche B Term Notes  under the Amended and
Restated Credit Agreement.

         (m) Section 3.20 of the Securities Purchase Agreement is hereby amended
and restated in its entirety as follows:

                  3.20.  Offering  of the  Notes,  the GS  Shares,  the Series A
Preferred Stock and the Warrants. (a) It is not necessary in connection with the
offer,  sale and  delivery of the Notes,  the GS Shares,  the Series A Preferred
Stock or the Warrants to the Investors to register the Notes, the GS Shares, the
Series A Preferred  Stock or the Warrants under the  Securities  Act. Until such
time as the exchange notes are issued pursuant to the Exchange and  Registration
Rights  Agreement  or the  Notes or  exchange  notes  are  otherwise  registered
pursuant to an effective  registration statement under the Securities Act, it is
not  necessary to qualify an indenture  relating to the Notes or exchange  notes
under the TIA.

                  (b) The Company has not, directly or indirectly, offered, sold
or solicited any offer to buy and will not, directly or indirectly,  offer, sell
or solicit any offer to buy,  any  security of a type or in a manner which would
be integrated with the sale of the Notes, the GS Shares,  the Series A Preferred
Stock or the Warrants and require any of the Notes, the GS Shares,  the Series A
Preferred Stock or the Warrants to be registered  under the Securities Act. None
of the  Company,  its  Affiliates  or any  person  acting on its or any of their
behalf has engaged or will engage in any form of general solicitation or general
advertising  (within  the meaning of Rule 502(c)  under the  Securities  Act) in
connection with the offering of the Notes, the GS Shares, the Preferred Stock or
the Warrants.  With respect to any Notes, GS Shares, Series A Preferred Stock or
Warrants,  if any, sold in reliance upon the exemption afforded by Regulation S:
(i) none of the Company,  its  Affiliates  or any person  acting on its or their
behalf has engaged or will engage in any  directed  selling  efforts  within the
meaning of Regulation S and (ii) each of the Company and its  Affiliates and any
Person  acting on its or their  behalf has  complied  and will  comply  with the
offering restrictions set forth in Regulation S.

                  (c) The Notes are  eligible  for resale  pursuant to Rule 144A
and will not, as of the date hereof,  be of the same class as securities  listed
on a national securities exchange registered under Section 6 of the Exchange Act
or quoted on a U.S. automated interdealer quotation system.

         (n)  Section  3.22 is hereby  amended and  restated in its  entirety as
follows:

                  3.22. Solvency. The Company is not, and after giving effect to
the issuance and sale of the Notes, the GS Shares,  the Series A Preferred Stock
and the  Warrants,  and the  exercise of the  Warrants  and the  purchase of the
Warrant  Shares in connection  therewith,  and the  application  of the proceeds
therefrom  will not be,  insolvent  within the meaning of Title 11 of the United
States Code or any comparable state law provision.

         (o) Section  4.1 is hereby  amended  and  restated  in its  entirety as
follows:

         4.1. Acquisition for Investment.  Such Investor is acquiring the Notes,
the GS  Shares,  the  Series A  Preferred  Stock  and the  Warrants  for its own
account,  for investment and not with a view to the distribution  thereof within
the meaning of the Securities Act.

         (p) Section  4.2 is hereby  amended  and  restated  in its  entirety as
follows:

                  4.2. Restricted Securities. Such Investor understands that (i)
the Notes, the GS Shares, the Series A Preferred Stock and the Warrants will not
be registered under the Securities Act or any state securities laws by reason of
their  issuance by the  Company in a  transaction  exempt from the  registration
requirements  thereof and (ii) the Notes, the GS Shares,  the Series A Preferred
Stock, the Warrants,  the Conversion  Shares and the Warrant Shares,  may not be
sold  unless  such  disposition  is  registered  under  the  Securities  Act and
applicable state securities laws or is exempt from registration thereunder.

         (q)  Section   5.1(iii)  is  hereby   amended  by  deleting  the  words
"Certificate of Designation"  and inserting in place thereof the words "Series A
Certificate of Designation and Series B Certificate of Designation".

         (r) Section  5.3 is hereby  amended  and  restated  in its  entirety as
follows:

                  5.3. Bank Financing.  Prior to or concurrently with the Second
Closing,  the Company  shall have entered  into an amended and  restated  credit
agreement with its lenders on terms  satisfactory to the Investors in their sole
discretion  (the  "Amended  and  Restated  Credit  Agreement"),  and the closing
thereunder  shall  have  occurred.   Without  limiting  the  generality  of  the
foregoing,  the Amended and Restated Credit Agreement shall provide, among other
things,  for (i) a  commitment  from General  Electric  Capital  Corporation  to
purchase $20 million in aggregate  principal  amount of the Company's  Tranche B
Term Notes; and (ii) Bank of America,  N.A.'s revolving credit  commitment to be
increased by at least $5 million from its existing  revolving credit  commitment
under the Credit  Agreement.  In  determining  whether the Amended and  Restated
Credit Agreement is satisfactory to the Investors in their sole discretion,  the
Investors  shall not be deemed to have accepted or agreed to any terms contained
in any draft  documents or term sheets  disclosed to the Investors  prior to the
execution and delivery of the First Amendment to this Agreement.

         (s) Section  5.6 is hereby  amended  and  restated  in its  entirety as
follows:

                  5.6. Proxy Statement;  Stockholders Meeting. The Company shall
hold the Stockholders  Meeting as soon as practicable  after the date hereof for
the purpose of acting upon this Agreement and the transactions to be consummated
at the Second Closing to the extent requiring stockholder  approval,  including,
without  limitation,  the issuance and sale of the Series A Preferred  Stock and
the Warrants to the Investors;  provided,  however, that at the request of GSCP,
the Company shall adjourn the  Stockholders  Meeting from time to time until all
of the conditions set forth in Article VI (other than the condition set forth in
Section  6.1(c) and other than those  conditions  that by their nature are to be
satisfied  at the  Second  Closing)  are  satisfied  or  waived,  such  that the
Stockholders  Meeting shall take place on the same day as the Second  Closing in
accordance with Section 2.5. The Company shall  recommend that its  stockholders
approve this Agreement and the transactions  contemplated  hereby requiring such
stockholder  approval.  The Company and the  Investors  shall  cooperate  in the
preparation of the Proxy Statement to be mailed to the Company's stockholders in
connection with the solicitation of such approval and shall use their reasonable
best efforts to take, or cause to be taken, all actions necessary to prepare the
Proxy  Statement,  file the  Proxy  Statement  with the SEC and  respond  to any
comments  it may have,  and  distribute  the Proxy  Statement  to the  Company's
stockholders as expeditiously as practicable;  provided,  that the Company shall
file the Proxy  Statement  with the SEC no later than  January  31, 2000 and the
Company  shall file a supplement to the Proxy  Statement in connection  with the
execution of the First  Amendment to this  Agreement no later than May 15, 2000.
The Company  shall give the  Investors a  reasonable  opportunity  to review and
comment on the Proxy Statement and related  communications  with stockholders of
the  Company,  and  the  Investors  shall  have  the  right  to  consent  to any
descriptions  of or references to (i) the Investors or any of their  Affiliates,
and  (ii)  the  Transaction   Documents  and  the  other   agreements   executed
concurrently  therewith and the transactions  contemplated  thereby in the Proxy
Statement  or such  communications,  which  consent  shall  not be  unreasonably
withheld or delayed.

         (t) Section  5.9(b) is hereby  amended and  restated in its entirety as
follows:

                  (b)  From  the  Second  Closing  Date  and  for so long as the
Investors and their Affiliates  collectively  beneficially own not less than (i)
66 2/3% of the  Second  Closing  Ownership  Amount  (as  such  ownership  may be
adjusted for stock splits, reverse stock splits, dividends paid in Common Stock,
reclassifications  of the Common Stock,  and other similar  events),  GSCP shall
have the right to designate, at all times and from time to time, three directors
of the Company;  (ii) 33 1/3% of the Second  Closing  Ownership  Amount (as such
ownership may be adjusted for stock splits, reverse stock splits, dividends paid
in Common  Stock,  reclassifications  of the  Common  Stock,  and other  similar
events),  GSCP shall have the right to designate,  at all times and from time to
time,  two  directors  of the  Company;  and (iii)  10.0% of the Second  Closing
Ownership  Amount (as such  ownership may be adjusted for stock splits,  reverse
stock splits,  dividends paid in Common Stock,  reclassifications  of the Common
Stock, and other similar events), GSCP shall have the right to designate, at all
times and from time to time, one director of the Company (individuals designated
pursuant to this  paragraph,  the "Preferred  Designees",  and together with the
Noteholder Designees, the "Investor Designees"). The Initial Preferred Designees
elected  pursuant to  paragraph  (c) below and the Initial  Noteholder  Designee
elected prior to the Initial Closing shall be the initial Preferred Designees.

         (u) Section  5.9(f) is hereby  amended and  restated in its entirety as
follows:

                  (f) After the date hereof,  without the prior written  consent
of GSCP, the Board of Directors (i) shall not consist of more than eight members
so long as the Investors and their  Affiliates  own any Notes and (ii) shall not
consist of more than ten members so long as the Investors  and their  Affiliates
beneficially  own at least  10.0% of Second  Closing  Ownership  Amount (as such
ownership may be adjusted for stock splits, reverse stock splits, dividends paid
in Common  Stock,  reclassifications  of the  Common  Stock,  and other  similar
events).

         (v)  Section  5.10 is hereby  amended and  restated in its  entirety as
follows:

                  5.10. Certificates of Designation. The Series A Certificate of
Designation,  in the form of Exhibit C to the First Amendment to this Agreement,
and the Series B  Certificate  of  Designation,  in the form of Exhibit D to the
First Amendment to this Agreement,  set forth the terms,  designations,  powers,
preferences  and  relative  participation,  optional and other  special  rights,
qualifications, limitations and restrictions of the Series A Preferred Stock and
the Series B  Preferred  Stock,  respectively.  The Company  shall,  prior to or
concurrently  with  the  Second  Closing,  cause  the  Series A  Certificate  of
Designation  and  Series B  Certificate  of  Designation  to be  filed  with the
Secretary of State of the State of Delaware.

         (w)      Section 5.15 is hereby amended and restated as follows:

                  5.15. Transfer Taxes. The Company shall be responsible for any
Liability  with  respect to any  transfer,  stamp or  similar  Taxes that may be
payable in  connection  with the  execution,  delivery and  performance  of this
Agreement  including,  without  limitation,  any such Taxes with  respect to the
issuance or transfer of the Notes, the GS Shares,  the Series A Preferred Stock,
the Warrants, the Conversion Shares or the Warrant Shares.

         (x)      Section 5.16(a) is hereby amended and restated as follows:

                  (a) So long as any Notes, GS Shares, Preferred Stock, Warrants
or  Conversion  Shares are  outstanding,  the  Company  shall  file all  reports
required to be filed by it under the  Securities  Act and the  Exchange  Act and
after the Second  Closing,  shall take such further  action as the Investors may
reasonably  request,  all to the extent required to enable the Investors to sell
any of the foregoing  securities  pursuant to and in  accordance  with Rule 144.
Such action shall  include,  but not be limited to,  making  available  adequate
current public  information  meeting the  requirements  of paragraph (c) of Rule
144. During the period of two years following the Initial  Closing,  the Company
shall  not,  and shall not permit any of its  Affiliates  to,  resell any of the
Notes which  constitute  "restricted  securities"  under Rule 144 that have been
reacquired by any of them.

         (y)      Section 5.18(a) is hereby amended and restated as follows:

                  (a)  From  the  Second  Closing  Date  and  for so long as the
Investors collectively  beneficially own not less than 10.0% of the total number
of shares  of  Common  Stock  outstanding  from  time to time,  in the event the
Company  proposes to issue any capital stock of any kind  (including  any Common
Stock,  preferred  stock,  warrants,  options or securities or units  comprising
securities  convertible into or exchangeable for Common Stock or preferred stock
or rights to acquire  the same) of the  Company,  other than (1)  pursuant to an
employee or  non-management  director stock option plan, stock bonus plan, stock
purchase plan or other  management  equity  program or plan, (2) pursuant to any
merger,  share exchange or acquisition  pursuant to which shares of Common Stock
are  exchanged  for,  or issued  upon  cancellation  or  conversion  of,  equity
securities of an entity engaged primarily in, or to acquire assets primarily for
use in, the business conducted by the Company and the Subsidiaries or a business
reasonably   related  to  the   business   conducted  by  the  Company  and  the
Subsidiaries,  or (3)  securities  issuable upon  exercise of previously  issued
warrants, options or other rights to acquire capital stock or upon conversion of
previously  issued  securities  convertible into capital stock, then the Company
shall:

         (i) deliver to the Investors written notice setting forth in reasonable
detail (1) the terms and provisions of the securities proposed to be issued (the
"Proposed  Securities");  (2) the price and other terms of the proposed  sale of
such securities;  (3) the amount of such securities  proposed to be issued;  and
(4) such other  information as the Investors may reasonably  request in order to
evaluate the proposed issuance; and

         (ii) offer to issue to the  Investors in the aggregate a portion of the
Proposed Securities equal to a percentage  determined by dividing (x) the number
of  shares  of  Common  Stock  beneficially  owned by the  Purchasers  (assuming
exercise of the Warrants (and  conversion of the Warrant Shares upon exercise of
the Warrants into Common Stock) and  conversion of all of the shares of Series A
Preferred Stock into Common Stock),  by (y) the total number of shares of Common
Stock then outstanding.

The Investors must exercise the purchase  rights  hereunder  within ten business
days after receipt of such notice from the Company.

         (z)  Section  5.19(a)  is hereby  amended  by  deleting  the words "the
Investors"  and  inserting  in  place  thereof  the  words  "GSCP  and the  GSCP
Affiliates".

         (aa) Section  5.19(a)(A)  is hereby  amended by deleting the words "the
Investors"  and  inserting  in  place  thereof  the  words  "GSCP  and the  GSCP
Affiliates".

         (bb) Section  5.19(a)(B)  is hereby  amended by deleting the words "the
Investors or the Investor  Designees"  and  inserting in place thereof the words
"GSCP and the GSCP Affiliates or Investor Designees appointed by GSCP".

         (cc) Section  5.19(b) is hereby  amended by inserting the words "Series
A" before the words "Certificate of Designation".

         (dd) Section 5.20 is hereby  amended by inserting  the words "Series A"
before the words "Preferred
Stock".

         (ee)  Section  5.22 is hereby  amended and  restated in its entirety as
follows:

         5.22. Use of Proceeds.  The proceeds from the sale of the Notes, the GS
Shares,  the Series A Preferred Stock and the Warrants shall be used for general
corporate purposes as shall be determined by the Board of Directors.

         (ff)     Section 6.1(c) is hereby amended and restated as follows:

                  (c) the  issuance  of the  Series A  Preferred  Stock  and the
Warrants to the Investors in connection with the Second Purchase shall have been
approved and adopted by the requisite vote of the stockholders of the Company in
accordance  with  applicable  NASDAQ  rules  and the  Company's  certificate  of
incorporation and by-laws.

         (gg)     Section 6.2(a) is hereby amended and restated as follows:

                  (a) each of the  representations and warranties of the Company
contained in this  Agreement  shall be true and correct  (disregarding  for this
purpose  all   references  in  such   representations   and  warranties  to  any
materiality,  Material Adverse Effect, Knowledge or similar qualifications) when
made (other than  representations and warranties that were modified by the First
Amendment to this Agreement,  which shall be true and correct as of May 5, 2000)
and as of the Second  Closing  (except to the extent  such  representations  and
warranties are made as of a particular date, in which case such  representations
and warranties  shall have been true and correct in all material  respects as of
such date),  except for failures to be true and correct which individually or in
the  aggregate  would not  reasonably  be  expected  to have a Material  Adverse
Effect;

         (hh)   Section   6.2(c)  is  hereby   amended  by  deleting  the  words
"Certificate  of   Designation"   and  inserting  in  place  thereof  "Series  A
Certificate of Designation and Series B Certificate of Designation".

         (ii) Section  6.2(e) is hereby  amended and restated in its entirety as
follows:

                  (e) the  Company  shall  have  entered  into the  Amended  and
Restated Credit  Agreement on terms  satisfactory to the Investors in their sole
discretion  as  provided  in  Section  5.3  hereof,   and  the  closing  of  the
transactions contemplated thereunder shall occur prior to or simultaneously with
the Second Closing;

         (jj) Section 6.2(h) is hereby amended by deleting the word "and" at the
end thereof.

         (kk) Section  6.2(i) is hereby  amended by deleting  clause (i) thereof
and inserting in place
thereof the following:

         (i) the Warrant Shares shall have been duly authorized and reserved for
issuance;

         (j) the Company  shall have paid in full all  interest  that is due and
payable under the Notes; and

         (k) the  Company  shall have made the  deliveries  set forth in Section
2.6(a) hereof.

         (ll) Section  7.1(b) is hereby  amended and restated in its entirety as
follows:

         (b) by either the Investors or the Company if the Second  Closing shall
not have been
consummated by June 15, 2000; or

         (mm) Section  8.5(c) is hereby  amended and restated in its entirety as
follows:

                  (c) The parties  agree to treat any  indemnification  payments
made by the Company  pursuant to this  Agreement for Tax purposes as adjustments
to the purchase price of the Notes, the GS Shares,  the Series A Preferred Stock
or the Warrants, as the case may be.

         (nn) Section 9.1 is hereby amended by deleting the words "$700,000" and
inserting in place thereof "$800,000".

         (oo) Section 9.3 is hereby amended by adding the words ", the Warrants"
immediately after the words "GS Shares".

         (pp) Section 9.5 is hereby amended by adding the words ", the Warrants"
immediately after each instance in which the words "GS Shares" appear therein.

         (qq)  The  references  on  the  signature  to the  Securities  Purchase
Agreement  as to the  number of shares  of  Preferred  Stock  each  Investor  is
purchasing at the Second Closing are hereby deleted.

         SECTION 3. Counterparts; Effectiveness. This Amendment may be signed in
any number of  counterparts,  each of which shall be an original,  with the same
effect as if the  signatures  thereto and hereto were upon the same  instrument.
This Amendment shall become effective when each party hereto shall have received
counterparts hereof signed by all of the other parties hereto.

         SECTION  4.  Miscellaneous.  Except  as  expressly  set  forth  in this
Amendment,  the Securities  Purchase  Agreement shall otherwise remain unchanged
and in full force and effect and remain binding upon the parties hereto.

<PAGE>

         IN  WITNESS  WHEREOF,  the  parties  hereto  have  duly  executed  this
Amendment or have caused this Amendment to be duly executed by their  respective
authorized officers as of the day and year first above written.

                           PROMEDCO MANAGEMENT COMPANY

                                            By:
                                                 Name:
                                                 Title:

GS CAPITAL PARTNERS III, L.P.
$_______ Notes

By: GS Advisors III, L.L.C.,
      its general partner

By:   _____________________
      Name:
      Title:

GS CAPITAL PARTNERS III OFFSHORE, L.P.

By:   GS Advisors III, L.L.C.,
      its general partner

By:   _____________________
      Name:
      Title:

<PAGE>

-------------------------------------------------------------------
GOLDMAN, SACHS & CO.
   VERWALTUNGS GMBH

By:   _____________________
      Name:
      Title:

and

By:   _____________________
      Name:
      Title:

STONE STREET FUND 2000, L.P.
-----------------------------------------------------------

By:   Stone Street 2000, L.L.C.,
      its general partner

By:   _____________________
      Name:
      Title:

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

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